Bigger isn’t always better, especially when it comes to optimizing your pipeline for new business opportunities. Some believe that there’s no such thing as a bad opportunity and that every referral is one to be pursued.
Instead, a pipeline that’s too big and/or not well diversified will only flood your agency with non-ideal clients that can negatively impact both your team’s morale and your margins.
If your agency currently relies primarily on referrals for new business, it’s imperative to know that referrals aren’t scalable. Relying on them may not lead to the eminent failure of the business, but it certainly doesn’t put your agency in the driver seat in terms of landing ideal projects or accounts.
So, is there a perfect pipeline mix for your creative, media or tech agency?
Ways Your Agency Brings in Business
To know what your pipeline mix should include, first you’ll need to identify the various ways your agency can and does bring in new business.
Strategic partnerships represent a huge opportunity. If you’re running an event, for instance, offering space for a brand that could potentially be a valuable partner gives them more awareness and exposure. It gives you the ability to bring in new business via their clients, their name, and their existing brand awareness.
It’s important to note that strategic partnerships typically only work with a non-competing entities, or at least companies where cross-promotion of services make sense for reciprocity.
As we’ve said, referrals can be tricky. Quality referrals are a great way to build your business due to their extremely low cost per acquisition, but this is an area that requires tremendous discipline and a solid prospect filtering protocol.
Many referrals are not a good fit, but the way you handle declining a referral will impact your company’s reputation and potentially its subsequent ability to grow. It’s always best to go through your standard discovery process, and then suggest another agency that might be a better fit for the prospect’s needs.
Land + Expand
Then, there’s the Land + Expand approach, which involves growing existing accounts. Find out what your clients are lacking both internally and with vendors, and see if there’s a way for you to add more value (and more to your retainer) to meet their growing needs.
Inbound + Outbound Marketing
Inbound marketing with SEO and carefully crafted content is, of course, another good way to bring in business and position your agency as a leader in your niche. Outbound marketing with paid media, including search, social, and other advertising should also be included but to a lesser extend—depending on your area of expertise, that is.
Sponsorships, Trade Show + Speaking Engagements
Your agency should also strongly consider sponsorships, trade shows, and speaking engagements if you’d like to be positioned as an expert within the vertical you serve. Talk to your team to see if inclusion in press makes sense, or consider authoring or co-authoring a book.
RFPs (or Not)
Many agencies focus on requests for proposals (RFPs), but these may not be worth the effort. From client self-prescription and working within a defined budget for an undefined scope, to being viewed as a commodity/vendor, and having to provide free work within a pitch, there are options that drain fewer resources and provide a greater return. Note that RFPs can work well if you already have established relationships with the issuing organization, or if your agency was courted and asked to respond.
That leads us to our next point: where should you allocate your resources for business development?
The Perfect Pipeline Mix for a Healthy Agency
A healthy pipeline mix for agencies should include several initiatives that have little cost per acquisition.
There should be fewer areas that have a higher cost per acquisition. These investments simply may not yield the desired return—especially if being executed in-house (and outside of your agency’s core competencies).
The biggest opportunity across the board is in expanding your agency’s footprint with existing, ideal clients, which should comprise about one-quarter of your mix. You’ve already established trust with these clients and don’t have to expend additional resources to grow the accounts. Your team is already in place to nurture and expand already existing relationships, and the probability of bringing in new business is very high—if your value proposition is clear and addresses the clients’ pain points.
Inbound marketing and speaking engagements/books should account for about twenty percent each of your mix. Inbound marketing could be just a matter of tweaking content that you’re already creating for your website and social channels. Speaking engagements and books may add a new, high-margin revenue stream to your company profits—and have a lasting impact on your reach and market position.
Sponsorships and trade shows, strategic partnerships, and outbound marketing should be around ten percent each, as they require a higher level of investment. You will have to shell out some money to book a booth, and you’ll have to pay to get your outbound marketing materials in front of the right audience. If these areas pay off, they’re well worth it, but they’re a bit riskier than the previously mentioned opportunities.
There is no one-size-fits all answer for how to craft the perfect pipeline for every agency, as there will always be variability in actual expertise, market demand, geography served and positioning. Yet, no agency should imagine that its current pipeline is set in stone or cannot be changed.
If you’re unsure how to craft a formal business development strategy in order to ensure the right pipeline for your particular agency, let’s talk.