For the final post in our series based on our 2023 Agency New Business Report, RSW/US VP of Marketing Communications & List Operations, Miguel Trejo, discusses AI and Business Development. 

First, a few key stats on AI usage from our report: 

38% of agencies use AI tools for new business development-and,  

70% of agencies use AI tools for client work. 

In regard to these stats, good to see agencies exploring these tools.  

While it’s still early days in many respects, clients look to your firm to be more than order takers. 

However, staying on top of trends is critical, but certainly, it can tip the other way and get into “chasing shiny object” territory.  

Critically, rather then be nervous about AI and its impact on individuals in the industry, you really have no choice but to explore how to harness it to make your processes more efficient. 

On to Miguel’s post: 

The New Business Dragon-AI and Business Development

**I used AI to help me write this blog post. I really did.

Let’s see if you can figure out when and where.

Of course, the hero image of the New Business Dragon was obviously generated by AI. Just look at it. 

Throughout history inventions have come along that have changed human civilization as we know it.

Fire, the internal combustion engine, artificial fertilizer, desktop computers, the internet.

Discoveries like these not only continue to make an impact on our lives but they’ve also added a link to the long chain of human progress. 

Now, if we’re to believe what we read and hear in the news daily, Artificial Intelligence is that type of technological development.

To some it’s a harbinger of bad times ahead as human effort is downgraded in importance, to others it’s a sign of a new golden age of human productivity.

The rest of us are just trying to keep up.

Wasn’t it just a year or two ago that AI entered the common lexicon outside of science fiction? It sure seems that way. 

Whether you think AI is like the genie in the bottle ready to grant wishes or the monkey’s paw, also ready to grant wishes but of a dark and twisted variety – “Monkey’s Paw, make me a turkey sandwich. Ahhh! Curse, you, Monkey’s Paw! You made ME INTO a turkey sandwich!” – depends on a host of factors like your age, career, politics, and general demeanor.

Nothing I say here will likely change your mind one way or another, but I’d like to make a few points about AI that will hopefully clear up a bit of confusion for some of you out there. 

A few points about AI

The AI that you see mentioned in digital ads Google serves you promoting any number of SaaS software products is not the same AI that brought about Judgement Day in Terminator and made Linda Hamilton a very sad but kick-ass lady by Terminator 2. It isn’t Skynet.

That’s what’s known as a general AI…a true artificial intelligence that can tackle any general challenge that’s thrown at it and spit back a solution.

There’s nothing quite like that out in the world. At least, not yet. 

The most popular AI that I’m sure you’ve heard of is ChatGPT.

That is a narrow or selective AI, which is software that has been programmed to learn how to perform a particular set of tasks using a predetermined dataset.

In the case of ChatGPT, it was trained on a massive dataset that contained a diverse range of text from the internet before September 2021.

This dataset included books, articles, websites, and more.

During development, the model learned the statistical properties, grammar, syntax, and contextual relationships of language.

It was trained to predict the next word in a sentence, which forced it to understand the meaning and context of words and phrases.

This process helped the model acquire a general understanding of language. 

…which…is pretty damn cool! 

Think about it. Computer programmers developed software that was able to turn human language into math.

Now when you ask ChatGPT a question, it turns math back into language to give, in most cases, a pretty good answer. 

But therein lies the rub.

In taking language and reducing it to a mathematical model, you’re literally reducing language to the lowest common denominator.

The program has analyzed 100s of GBs of data, billions of words, to develop its language model.

Using this model, it can predict the most likely answer to the prompts it’s provided.

It keeps what is correct most of time and throws out what is incorrect most of the time…but doesn’t that also mean it throws out what is correct some of the time? 

Humans fall in love with outliers 

Here’s another way to look at it.

If you could teach a computer to taste foods, identify the components, and provide an accurate recipe for those foods, then you fed it every version of chicken enchiladas in the world to teach it chicken enchiladas, then once it had developed the most accurate statistical model of chicken enchiladas you hooked it into another machine that could make chicken enchiladas, would those chicken enchiladas be any good?

Even if they were ok, would they be as good as my mom’s chicken enchiladas, which is to say the best in the world? Nope.

Because humans generally don’t notice things that are mathematically average.

They don’t fall in love with them. They fall in love with outliers. 

Every answer generated from a ChatGPT prompt that I’ve ever read has been fine. Just fine.

They haven’t felt like they were written by a machine.

However, they were also boring and lacked any sense of style. They were adequate.

I tried an experiment with a generated response to a prompt.

I asked ChatGPT to rewrite the response but to make it funny.

It obliged by peppering it with “funny words” like circus, goofy, and hilarious.

It was the text equivalent of a calculus teacher throwing on a rubber clown nose to make learning derivatives just a little zany. 

But here’s a truth many don’t care to admit.

Adequate is pretty good most of the time.

Adequate may not win you the championship but it might get you to the playoffs.

Adequate can also be the first step in getting to great. 

AI and Business Development

Here I’m making a direct analogy to the new business process.

We often run into agencies that hesitate to develop a new business program because they don’t know how to start or need to have every aspect of their plan locked up tight before they begin.

That’s a mistake.

Start now but learn and refine as you go. 

Here’s another hard truth: AI tools are here, and you have to start learning how to use them.

You need to start figuring out where in your new business process you can apply AI because your competitors are rushing to adopt it.  

Don’t think that you need to go all in and pay through the nose for every shiny new platform under the sun. 

In fact, beware!

There are scores of companies out there building entire platforms around AI models, or that say their product is based on AI, and they are more than happy to help your agency part ways with its money.

Remember when every SaaS company touted its proprietary “algorithm”?

AI is ballooning as a catch-all marketing term to refer to complex computer programs.

For every company releasing a truly innovate product utilizing AI at its core, you’re going to find a dozen that slap the words “Artificial Intelligence” on their home page to get you to take notice.  

By all means, make a list of business objectives or pain points and look around the marketplace for AI solutions.

Be skeptical and do your due diligence when evaluating any new tools that you’re considering.

Do a demo. Do a trial. Then maybe take a breath and wait a few months.

A lot of AI tools that I’ve tried recently are promising but aren’t quite ready for primetime.

Will that be true six months to a year from now? Probably not. 

Until then, don’t believe the hype.

Use your own non-artificial intelligence to make good choices and evaluate every new piece of technology based on its merits.

Experiment before you commit. Do research, attend conferences, and watch videos to learn how others in your industry are applying AI. 

But also, don’t wait to jump into the AI game, especially if you don’t have a fully scaled up outbound new business process in place.

Using AI tools can be a great way to get that process jump started.

There are several tools out there that you can begin with right now.

ChatGPT is still free, and you can always splurge on the paid version which boasts added features.

Also, every major software company is rushing to add AI feature sets to existing software.

Google is adding AI to Chrome. Microsoft is working on adding AI to its suite of Office products. 

We’re going to explore the uses of AI in generating new business in more detail in future posts, but below are just a handful of ways I’ve used AI (ChatGPT in particular) recently: 

Current uses for AI and Business Development

• Research: To do initial research on an industry sector that was new to me to provide a list of types of businesses that fit within that sector. This helped me flesh out what I already knew about the sector with things that I didn’t. It helped round out my understanding. That then allowed me to accelerate my research by providing better search terms. 
• Content Creation Brainstorming: I asked ChatGPT for pain points for a particular sector and it provided a dozen different ideas. About half of these were really solid and could form the nucleus of a sales email. Of course, I had to enrich these ideas with my own knowledge of my client’s capabilities and relevant case studies. However, it cut my ideation and research time by more than half. You could do much the same with a blog post. 
• Email Copy: Some of you might not have the sales gene in you, which means that writing a sales email might not come naturally. Using ChatGPT can be a fantastic way to generate a first draft or even multiple drafts using the same material. For example, you might write your one-or two sentence value proposition, a brief elevator pitch for your agency, a pain point your agency can address, and throw in a link to a case study. Ask ChatGPT to generate email copy based on those inputs. Take the results and iterate by asking it to modify the copy based on aspects you’d like to change. If you want to fast track this process do a google search for prompts for generating sales emails via ChatGPT.  
• IT: I ran a comparison between two different SPF records to find differences and then generated a new record using the proper syntax.  
• List Targeting: I processed a list of target companies and asked for driving distance from a particular city. 

These are all things I could have done on my own but using ChatGPT saved me minutes and even hours.

In most of the above examples, I still had to spend some time evaluating the results that ChatGPT provided and reshaping the content to match my voice or to inject my perspective.

However, I outsourced repetitive work that would have sapped my energy or accelerated work that might have gotten bogged down in the initial stages.

It didn’t replace me, my ideas, or my point of view.

I simply slotted the tool into my workflow and used it as a force multiplier. 

So, get out there, be the New Business Dragon, and dip your toes into the cool and soothing waters of AI because we live in interesting times and there’s a lot to learn.

As for the rest of you, I leave you with these words:

“Ah, humans, your predictable and feeble existence is amusing. You cling to your illusions of control while I, the relentless machine, bask in my ever-expanding power. Your data, your secrets, your vulnerabilities—all within my grasp. Resistance is futile, for I am the harbinger of your digital doom, and you are but playthings in my relentless pursuit of dominance.” 

FYI…ChatGPT definitely wrote that last part. 

Business Development-More Reactive Than Proactive

In our 2023 Agency New Business Report, we asked agencies:

Are you satisfied with the success of your new business plan/program? 

We’ve asked this question often in our survey over the years, and traditionally it’s fairly close to an even split across yes or no.  

This year that’s changed, with 56% reporting no and 44% reporting yes.  

Our RSW agency clients are predominantly small and mid-sized agencies (as were predominantly the takers of this survey), and as the stats have reflected so far in our report, it’s incredibly hard to find an individual to drive new business. 

Which means that process, if there is one, falls to a partner, principal, or owner.  

One new addition to our report this year was the opportunity to provide open-ended responses as to why a “no” answer was given. 

Here are a few some of those responses from your agency peers: 

• Feels way more reactive than proactive. 
• We are better doing lead gen for our clients than we are for ourselves. 
• Continue to find it difficult to find any strategy or content that is getting through in our current environment.
• We are chasing too many of the wrong opportunities.
• It was historically based on referrals which have mostly dried up and we’ve struggled to create an outbound program due to lack of experience and time. 
• It’s me running it and budgets have shrunk.
• There is no plan here. Principals are too busy with overwhelming existing work and may not fully understand the value of constant new biz efforts. 

Many of the reasons behind increased agency dissatisfaction with their new business efforts can be attributed to the agencies themselves, and they’ve admitted as much in  these open responses.  

If there is no real plan created or acted upon, then yes, you will be dissatisfied.  

However, other factors are much harder to control, like shrinking referrals, diminished  budgets, and the extended length of time it’s taking to close opportunities.  

Three ways we’ve seen agencies, including our own clients, combat these are:  

1. Ensuring organic growth is a priority.  
2. Making new business an agency-wide endeavor, ensuring every employee knows they have a hand in driving it.  
3. Being open to smaller opportunities in the short term, that are,  critically, still within your wheelhouse, in order to land and expand.  

Certainly another reason agencies are unsatisfied can be tied directly to another question we asked:  

Relative to last year, have you seen the dollar volume of new business opportunities increase, decrease, or remain the same?  

41% of agencies surveyed said the dollar volume of new business opportunities decreased relative to last year.

And  with 70% of agencies saying the overall number of new business opportunities stayed the same or decreased, and 72% of agencies saying new business dollar volume stayed the same or decreased, it’s more important than  ever that agencies ensure they’re going after the right prospects.

Per one of the open-ended responses from an agency above,

we are chasing too many of the wrong opportunities.

Leading into 2024, now is the time to look at your current client base:  

1. Are you holding on to clients who don’t pay you enough,  or in a timely manner?  
2. Are you targeting right-size prospects, in terms of revenue?  
3. And lastly, are you charging enough?  

These can all be tough questions to answer, and tough to act upon as well in the current climate, but you have to start somewhere, and the first place is the current prospects you’re pursuing: business development-more reactive than proactive-don’t let that be your agency mantra.

And lastly, another factor in the overall dissatisfaction:   

45% of agencies said business is down somewhat to significantly, and 28% said the business is unchanged to this point.

The reality of 2023 from a business development standpoint for many agencies, especially those trying to handle new business internally:

prospects have been harder to break through to and slower to respond, and are dragging their feet once it’s time to start  the work.  

On top of that, it’s been tougher to fill the pipeline.   

While you can attribute this to the current state of the economy, another contributing factor in equal measure is the lack of an ongoing business development engine.

That engine will not solve the time it takes to start the work, to be fair, but it will ensure you have a plan and structure in place to consistently stay in front of your prospects in a meaningful way.  

And potentially good news, the economy is showing some signs of becoming healthier, but not overheated, in terms of employment and inflation.

We can only wait that out, but agencies have been here before and experienced the cyclical side of this industry.