Driving new business for small and mid-sized agencies is particularly difficult because clients must come first, and the average new business director at an ad agency last 18 months.
The top 3 reasons it’s harder for ad agencies to get new business: 1) tougher to break through to prospects, 2) 39% of ad agencies said there are fewer opportunities, and 3) they can’t find the right hire to drive new business.
The Top 3 Reasons It’s Harder For Ad Agencies To Get New Business
1. It’s Harder to Break Through To Prospects
55% of agencies told us the main reason it’s more difficult to obtain new business is that it’s harder to break through to prospects.
Interestingly that percentage dropped from 59% last year to 55% this year.
One would have thought the opposite would be true, given the 15+ point increase in agencies finding it harder to get new clients.
So agencies are actually finding it a bit easier to break through to prospects than last year-that’s good news.
Looking at the second-highest reason agencies gave, last year it was “prospects that went dark after a first meeting” at 32%; however, that’s not the second highest this year.
In fact, that came in fourth, at 27%!
So agencies are having a slightly easier time, or doing a better job, with prospects that go dark.
Both are good to see, but it doesn’t really jibe with that 15+ point increase in agencies finding it harder to get new clients.
The 2nd and 3rd highest reasons agencies gave for why it’s harder to obtain new business in this year’s survey do coincide with that increase and should give agencies pause.
2. Fewer Opportunities
In 2022, 39% of agencies said there are fewer opportunities out there.
In 2021 that number was 23%.
While not overly alarming, that’s a 16 point increase.
I’ll throw some tough love out here:
Are there fewer opportunities, or are you just not actively looking for them?
Another stat from this same question:
The percentage of agencies who say they have no process in place is 25% this year versus 5% last year.
With no process, it is, in fact, harder to find opportunities.
3. Can’t Find The Right Person
The third highest reason was, “can’t find the right person to drive the new business program” at 31%, whereas it was at 0% in 2021.
Agencies have always had trouble finding and keeping the right person to drive new business, but that’s quite an increase.
These stats paint a picture of agencies experiencing a fair amount of organic and existing growth, coupled with referrals throughout 2021.
To quote our 2021 Agency New Business Report, “the current influx of new business is not coming from actual business development on the part of agencies.”
And that looks to have played out for many agencies, who understand there needs to be a balance that includes some manageable form of outbound prospecting for new business.
Within this question was an “other” option, with the opportunity to provide open-ended responses.
Given the variety of responses, we wanted to give you a sample from your agency peers as to why it was harder for them to obtain new business:
• Hard to find prospects with significant budgets
• For pitches, Clients are still hiding behind video conference
• Uncertain we are targeting “right fit” prospects and/or it’s harder than ever to break
through to them if they are right fit.
• Hard to hire people necessary to build bandwidth to take on new clients
• We’re more sharply focused on ideal client prospects and that takes more time right
now to break through.
• Turnover and inexperience on the client side
• Economic uncertainty/headwinds
Those are your top 3 reasons it’s harder for ad agencies to get new business.
More posts to come from our report.