“We’re a full service integrated marketing agency.” Sound familiar?

Trying to be everything to everybody is just one of the big mistakes that agencies today are making when it comes to attracting new business. Agencies hate to leave money on the table, even if it’s “bad money.” But we all know what happens when you chase after or work with clients who aren’t in your sweet spot. They clog your new business processes and cost you time and money.

My podcast guest, Lee McKnight, Jr. helps agencies solve this conundrum and many more in the dreaded agency quest for new business. He helps agencies get out of their own way and identify what makes them a unique option and just what certain prospects need.

We cover a lot of ground in this podcast including the following:

  • How to prevent your agency from making the major mistakes that agencies make all the time
  • Why agencies need to specialize instead of generalize
  • New business: how to develop a better, simpler new business process
  • How to use a delicately balanced process that uses all different kinds of marketing
  • Why patience is so key in closing on new business
  • The importance of having one person who is the leader on a project
  • Why there needs to be a balance between showcasing the figurehead and the agency
  • The tools you’re going to need to put into practice the objectives discussed in this episode

Lee McKnight Jr. is the Director of Business Development for RSW/US in Cincinnati, Ohio. They are a new business development firm that works solely with agencies and marketing services firms. After graduating law school, he ran away as fast possible from that profession and worked for an internet healthcare start-up until the bubble burst and his magical stock options disappeared in the late 90s.

Fast forward through some interesting marketing and sales positions to RSW/US where Lee has spent the last 8 years working with agencies of all types to help drive their new business efforts. A big fan of history, comics and horror novels, he’s currently in a few bands in Louisville and Cincinnati and likes to pretend that chicks dig married, 44-year-old guys with kids that play in cover bands.

To listen – you can visit the Build A Better Agency site (https://agencymanagementinstitute.com/lee-mcknight/) and grab either the iTunes or Stitcher files or just listen to it from the web.  

If you’d rather just read the conversation, the transcript is below:

Table of Contents (Jump Straight to It!)

I.        Mistakes Agencies Make in the New Business Process

II.       What Can Agencies Do to Get Better at New Business?

III.      Inbound vs. Outbound Marketing for New Business

IV.     The Costs of Not Having a New Business Process in Place

V.      What Successful New Business Agencies Look Like

If you’re going to take the risk of running an agency, shouldn’t you get the benefits too? Welcome to Build A Better Agency where we show you how to build an agency that can scale and grow with better clients, invested employees, and best of all, more money to the bottom line. Bringing his 25 plus years of expertise as both an agency owner and agency consultant to you, please welcome your host, Drew McLellan.

Drew: Hey, everybody. Thanks very much for joining us for another episode of Build A Better Agency. Our goal as you know with this podcast is to help agencies run smarter, build their agencies to be bigger, stronger, better, whatever that means for you as an owner. And at the end of the day, put more money at the bottom line for you the owner. And so one of the topics that is always a burning issue for agency owners is the whole issue of developing a new business process. So I’m excited to have our guest Lee McKnight Jr. with us.

So let me tell you a little bit about Lee. Lee is the director of business development for RSW US in Cincinnati. As many of you know they are a new business development firm that works solely with agencies and marketing service firms. But what many of you probably don’t know about Lee, even if you’ve bumped into him before is that he actually graduated from law school, but apparently ran quickly away from that profession. And jumped into the Internet healthcare startup space where he hung out until the bubble burst and all his magical stock options disappeared. So he had to get a real job. Did some other things until about eight years ago. Landed with RSW where he has spent the last almost decade working with agencies of all types, to help really drive their new business efforts.

When he’s not at work, Lee is a big fan of history, comics, and horror novels. He’s also in a couple bands in Louisville and Cincinnati, where he says, this is not me saying this about him, but I’m sure it’s true. He likes to pretend that women dig married 44-year-old guys with kids that play in cover bands. So with that, Lee, welcome to the podcast.

Lee: Thanks, Drew. No, I’m excited to be here. Yeah, I think I said previously, my wife just loves that last part when I throw that out there. But no, this will be fun.  

 

Mistakes Agencies Make in the New Business Process

Drew: Yeah, it will be fun. So you know, as you know, all agencies worry about new business and fret about it. So over the course of the eight years, you’ve bumped into a lot of agencies and you sort of observed sort of where they’re at in their native environment before they start working with you guys. What are some of the mistakes that you see agencies make around the new business issue?

Lee: Oh gosh. I think…you know, I think initially, you know, part of where they go wrong is agencies tend to get in their own way, right? I mean, kind of out of the gate. And we understand it because you know prospects really kind of have to…excuse me, clients really have to come first. I mean that’s part of kind of where we come in, to be honest with you.  
But I think in terms of some of the things that I think happen to them, you know first I mean there’s a couple. Probably the main ones are one, I think unfortunately and I touched on this when we were in Nashville and a few of these things at the Fuel Lines conference. But a lot of marketers see them or prospects see them, first of all, as you guys all do the same stuff. And God forbid the clients sometimes think that way. You know, they put that label on you.  They want to put you in your box. And that’s what you guys do.

And so agencies get frustrated understandably. But that’s one of the big reasons why it’s so important, first off, to use that language that’s not all the same. And I’m sure, Drew you’ve seen it. I mean…

Drew: We’re a full service integrated marketing agency.

Lee: We’re a great partner. We solve these problems. And you know I do think they’ve gotten better, agencies generally and understanding at the very least, we can’t use those very same words. But it’s still out there. You know I think also a couple other things. Marketers and prospects and I know sort of our prospects are not necessarily all marketers, but I’ll use that term throughout to sort of ease, but, you know, they’re getting hundreds of touches a week. And we’ll hear agencies get frustrated to say, “You know I’ve been reaching out, for God, at least for weeks. And what’s going on?” It’s like well. Yeah, four weeks is a drop in the bucket as far as that goes.

And then the other thing is, you know, marketers only read what’s in front of them. And I think a lot of agencies tend to forget that too. And I know you guys do some great research. We do some on our own as well. And you know we see it. I love the stats that it’s really encouraging. 43% of marketers read agency blogs. We got that from one of our agency marketer’s surveys. And then 57% of them read agency newsletters. So it just behooves agencies, especially when it, obviously when it comes to content for example, that you’ve got to keep in front of them but…and if you don’t, your competitors are. But take heart. Because maybe you didn’t get a comment on that one post but they are, if you’re putting it in front of them, a good chunk of them you know are reading what you’re doing for example.  

Drew: But it also means that if you say you’re doing a monthly newsletter, sending it out seven times a year is probably not brilliant.  

Lee: Thank you. Yes. Which I mean in that scenario. I think that’s where you know consistency is so important. And you know just in terms of how often you’re doing it. I totally agree. Yeah, just a few times a year is not going to cut it.

Drew: Right, right. So where else are agencies sort of stubbing their toe in terms of new business?  

Lee: Yeah, I think the other thing is that marketers are telling us like from the same survey, 88% of marketers want to work with an agency that has some kind of specialty. And I think sometimes agencies get a little, get their hackles up when that happens. Because that doesn’t necessarily mean it has to be health care, right, or CPG. And if you know it’s, in fact, I was talking to an agency owner. Not to keep referencing that but it happened to be in Nashville, the Fuel Lines conference again here just because that’s been in the past several weeks.

And I spoke there and brought that up. And he came and said, “You know we’re generalists and we’re doing great.” And you know and of course, you can’t argue with that, right, because they are doing well. But I think it was interesting. Once we started talking a bit more. What I realized was yeah, you’re working in multiple categories. But however you do own, and in their case, it was in how they worked with their clients. And I’m not just talking about a process, which God forbid everyone says they have.

Drew: Everybody has one right.  

Lee: But we realized…

Drew: They have cute names for it but it’s all the same.

Lee: I know. I love the cute names. I think it was one of the speakers at Ballowitz said, “You know you all got the bubbles.”

Drew: Right, right.

Lee: And I love that. He had like eight slides up. And they’re all exactly the same. But you know it’s one of those things where as we were talking, he realizes like well, yeah. You know what? You’re right. We own this and it’s too much to go into what that was. But so I think that’s part of it too and I think where else they kind of stub their toe if you will, maybe…folks love stories, right? That’s what we do. I think one of the things, and I’ll use one of our own clients. I will not throw their name out there.  

But I will say they started off, you know, a little bit of a stumbling block I think. Because in terms of what we do, I mean we’re…our goal is to get our clients, who are all as you mentioned in the beginning, you know what, they’re all agencies or marketing services firms. But the goal is to get them qualified meetings and do that with right fit prospects, you know, to build lists for them where we’re going to be able to really go after the right folks. But in terms of those qualified meetings, we realized look, there’s a lot we can do beyond that to help clients get closer to closing business.

And so some folks, some agencies actually they need more help in like getting to the table. And they ask us to help them in those first meetings because they may be used to referrals, right? And it’s a different ballgame, you know, than with what we’re getting them. Doesn’t matter how qualified they might be. So we had a client who it was like their second meeting. And the new business director asked, as we often do, if it’s a phone meeting to start, can we be in that? Now sometimes, we just introduce the client, for example. And if the client’s been around longer maybe we’ll even take part in it.  

But what we always try to tell them to do is in that first meeting, unless that prospect has specifically asked for some kind of a presentation, or you know to walk them through a WebEx, that’s fine. But if not, close the laptop and listen, you know? Have a conversation, like you and I are doing right now. So this client started off pretty well. Unfortunately quickly devolved into just kind of talking about themselves. I mean you couldn’t have asked for a better softball. The prospect like three sentences in literally said, “Our challenge is…” and then laid out three challenges they had. And I mean how awesome is that right?

Drew: Right, right. Stay there, stay there, stay there.

Lee: Oh, my gosh. Right and It’s like oh you just…thank you for the silver platter you just handed to us, you know? And they were legitimate challenges within their wheelhouse. You know, our new business director had done a nice job of and our list team. And you know it’s a team effort with us. We’ve got good folks that are all helping the new business director. So thought there’s the home run. And then God bless him, our client went…I think in their head…well I know, what they had was we’re going to use this example. We’re going to use this case study and that’s what we’re going to tell them and they’re going to love it.  

Well instead of bobbing and weaving and you know talking about those three challenges, which as I said were in their wheelhouse. They just went with what they thought, “Here’s what we’re going to do.” And it had nothing to do with those challenges.

Drew: Yikes.

Lee: Oh, and so this director is trying to, you know, happened to be a she in this case. Kind of hold her tongue and managed to kind of turn the corner. And the client I think realized it too. And then when that call was done, our new business director, she said, “Okay guys. This is kind of hard to say but here’s where that went wrong and we can fix this.” And we did and through both, you know, of them working our client and our new business director working with them actually ended up and they’re doing great. But that’s one of those things where you know you’ve got to listen and be able to get those verbal cues, right? And as I say kind of bob and weave with where that prospect’s going.  

Drew: I think one of the issues for agencies is they’re so anxious to get to the close. That they sort of go from Hi, It’s nice to meet you. And would you like to marry me? Right.  

Lee: Yes.

Drew: You know and there’s no sort of you know can I buy you a drink and let me ask all about you and you know let’s gaze into each other’s eyes for a while. That whole new business process sort of gets lost. And agencies, you know, you can’t go from A to Z in one in one fell swoop. And unfortunately, I think agencies are so anxious and because they often let new business lag, that effort lag until they’re in a desperate situation, I think they sort of wear their desperation on their sleeve. And I think clients don’t like the smell of that.  

Lee: Yeah, no, I think your 100% right. Actually, I love that. I’m going to steal that from you actually.  

Drew: Have at it.

Lee: Yup, the first date. I mean you’re exactly right. It’s like don’t give them the ring yet. Good Lord. Yeah.  

 

What Can Agencies Do to Get Better at New Business?

Drew: So when you work…when you guys are working with clients, what kind of things do you teach them how to do better? What are some things that the agencies need to learn how to get better at that you help them? You know, actually, let me self-direct this a little bit. One of my pet peeves is the generalist comment. So I believe that and our research shows, and I know yours does too, that clients are saying loud and clear, “I want specialists.”

And in our research, last year’s research that we did, what they said is, “I want you to have at least 25% of your business in my category. Otherwise, I don’t think of you as an expert. So I want expertise.” So how do you help an Agency who believes that the generalist methodology is the way to go? How do you help them understand the risk of that?

Lee: You know that’s interesting. Well, I think first answer to your question. I mean we’ve got first of all we have stats to back it up. And some of those that it’s good to put kind of just good old plain hard facts in front of folks. And then I think then part of it is what…I’ll give that example…I’ll go back, excuse me to that first example I gave from the agency owner at the national conference was that. So the first thing is what we want to talk it through. And typically what we realize is number one, either really they are owning something and they just didn’t realize it. Or the other…in the other ways, I mean typically what will try to do is go walk them through what is your new business process now? You came to us for a reason, right?

And so, and specifically, to answer your question when it comes to generalists, you know, we will tell them. And in our own experience what we have found is when you play that way, yes, it’s good to not put all the eggs in one basket so to speak. And I think that there’s always caveats to that too because you have your pharma agencies, for example. But I think just as one example. But I think also what we try to do is show them…like I think for example. We talk about folks that are who’s really doing this well?  

And I think one of the things that we try to do in our own, and I know that you all do too, is try to put out good content that agencies can use whether they’re going to work with us or not. I think that’s something our owner, his name’s Mark Snyder, that he and myself have really embraced. And course we’re not the only ones. I mean a lot of folks follow that model. But I think one of the things that we did recently is we put an e-book out within the last six months. And there’s a point to this, by the way, Drew.  

Drew: I have no doubt.  

Lee: So we…

Drew: You’ll get there. Just keep talking.

Lee: We’re there. Yeah maybe. So we wanted to have a series and I think we did six, it was on our blog, but we did an interview with different individuals at agencies who headed up new business. And we wanted to make sure that none of them, in this case, were our own clients, to show agencies out there and folks who might be listening right now, you know, that look, here are folks who are doing it and doing it well. And here’s what you can learn from them.  

And so we’ve used that quite a bit, whether it’s, you know, and part of my job here at RSW is to bring agencies on board along with our owner Mark. And so I’ve used this e-book in the past. And it resonates. And it really was small to mid-size agency, you know, was really our sweet spot even though we work with some larger and that’s what we tried to do here.  

But so we interviewed all six of them and we used the same 10 questions. And one of the things we found was…well, a couple of things but specifically to generalist, I mean, first of all, that they got it. They saw that new business is a process and it needs support. That that these folks are you know in terms of what they’re doing on day to day basis, that each agency considers new business an agency-wide endeavor. You know, all of them are vested in it. They realize they have to hunt and that thought leadership has to be a part of it. That referrals are fantastic, you know, they need to pursue those. But don’t let that be your entire strategy.

But overall each of them owned something. And we can show concrete examples to some of these folks that are coming on board to say…and again, might not necessarily be category specific. But that they own something there. And so I think that just to give you another example of kind of some things that we’ve seen out there. And that’s an e-book. I mean it’s on our site. You can download it. But it was interesting that all of them, you know, some of those factors that had in terms of what they all had and that they’re doing the same, that was one of them.  

Drew: Yeah. I just think in today’s world, you know, one of the other things I know your research showed, and ours did do too. Is that not only do clients want specialists, but they also typically are working with two or more agencies. So they, by default, are putting a label on agencies. And whether your specialty is a vertical like healthcare or pharma or whatever it is or it’s a deliverable like SEO or PR or whatever that may be, they do want to put us in a little box.

And I think one of the mistakes agencies make in the new business process is struggling to be everything to everybody, thinking I’m leaving money on the table. But the truth is a lot of that money is money that you’re not going to get to keep anyway because when you work with clients that are not your sweet spot clients, they end up costing you time and money. You’re actually paying for…you know, some of the things, when I’m looking at some of AMI agencies and I’m looking at some of the clients that are giving them trouble, when we really crunched the numbers, they’re literally paying for the privilege of working with that pain in the rear end client. And when you show them in black and white you go, “Are you kidding me?” They begin to understand the importance of…the importance of understanding who can we serve and delight on a regular basis.  

Lee: Yeah, and you know I really like the way, and we don’t have to just like get into it now, but I’ve been a groupie. I’ve seen you speak twice in the last couple of weeks, Drew.  

Drew: You know and neither time did I see you in the back with like your Bic lighter or anything.  

Lee: You know, I really wanted to. I had my Iron Maiden T-shirt on. You know it was…

Drew: I love that.

Lee: Yeah, but one of the things you mentioned, and specific to that, and quite frankly I would love to kind of incorporate that into even conversations that I’m having when that would come up and I think one of the ways that you framed it was wasn’t like that the stool? Where you talked about, you know, here’s where things are going to fall out. And I loved how you laid that out. And you even got some push back as I recall from a couple of agency folks in the audience.  

Drew: Yup, absolutely, yeah. The agencies are very leery of saying no to some clients or prospects. And the truth of it is that that’s a position of power that when your agency is really healthy, that feels very good to go, “You know what? This is just not the right fit for us.” And be able to walk away from that opportunity is really liberating. And it also says to your staff that you’re serious about this and that you really respect the work that they do and the clients they can serve best. And you sort of get it.  

And you’re really about, this is really for the agency that wants to make good money doing the work they do as opposed to taking a client for cash flow. And one of the things that worries me about agencies that don’t make time and invest in new business is they’re often coming at new business from a point of desperation, which means they don’t get to choose. They don’t get to choose. They have to take whatever comes across the transom. And that’s a very dangerous position to be in.  

Lee: Yes. Yeah, really couldn’t have said it better. I think that desperation point, we’ve seen it. We’ve seen it many times. And I think, you know what? We get asked often…you know, because we certainly talk to plenty of agencies, that the timing is not right or we may not be the exact right fit. So again, in this business you never know, right? So I think one of the things that we try to tell agencies, you know because you are so much in your own head space understandably, you’re close to it, it’s…with a lot of these of folks, it’s you need to get back to basics. And almost in a lot of ways wherever you are, do a reset and think about…I’ve talked about this in the past. But what is your reality as an agency in terms of what you can truly handle out of the gate?

And look, the reality is that you never have time. So yes, you have to push yourself past what really is your reality. But I think it’s always talk about like the four you know…look at the simplest. You make things too hard, and agencies make new business so hard. Make it…I mean simplify it up front in terms of here’s what the process is going to be. Here…I mean, and it write it all out. And then consistency, of course, is part of it with the messaging, you know, methodology, outreach. Have that process in place and then we always try to tell them, it’s about baby steps. You know, it’s please don’t try to jump out of the gate.

I talk to these agencies who, God love them, but they hire a consultant, they start HubSpot, and then they think, “We might start with you guys too.” And I’m like, “When are you going to do that?” We’re going to start with all you guys like in a month. It’s like, “Oh my God. Don’t. No, don’t do that.” And this one example, whether it’s us or somebody like us, but it’s like you take a step back and look, you know, clean house first. You know, get in there first. So yeah, it’s interesting.

Drew: Yeah, I think that’s the other misperception that agencies have is that they think they have to be on every social network and they have to be producing content every day. And every piece of content they produce has to be a 25-page white paper that is so earth shaking that, you know, the Pope is probably reading it as we speak. And you know the reality is, and I said this in one of my recent presentations, the truth is the bar is so low. Your competitors suck at this so badly that you have to be one step above crappy to be good at your business. And that’s the good news. Is you just have to do a few things well and consistently and you’re going to be ahead of the pack.  

Lee: Yeah, it’s funny. And you actually said and our owner Mark and I said it too. And you know it’s kind of it probably hurt some people in little pangs. But of the things and you said it on stage there in Nashville was I think someone in the audience had brought up to you. something along the lines of well, you know, if everyone’s doing this, I mean we’re already competing with each other anyway. And you immediately looked at them and said, “I’m sorry to tell you that most of you will not do this. It’s just a fact. And I’m telling you what to do. And if you followed it, you would succeed. But you’re not.” And you know it’s like that’s just the hard truth. And it is true and I guess in some ways that helps us. But yeah, I mean that’s spot on. Absolutely.

 

Inbound vs. Outbound Marketing for New Business

Drew: So you know I know that one of the things that you guys do is that you sort of talk about both inbound and outbound. And everyone is so…every agency I know is so enamored right now with the inbound thing. And I’m and don’t get me wrong. I think it is a fine tactic to take and every agency needs to be producing some content and drawing people to them. But I know that for you guys, you believe in sort of a blend of outbound and inbound, which I happen to share that belief. So could you talk a little bit about that?

Lee: Yeah, absolutely. You know I think in terms of what we’ve learned over these, it will be that you mention it will be…we will be ten years old in a couple of weeks. And I’ve been here eight of those. So we have certainly learned and of course, as we know many tools rapidly change. Twitter today could be who knows tomorrow. But I think ultimately what we’ve realized when folks like…I’m not picking anybody, but HubSpot obviously being one of the big players, or Marketo, or whatever it might be, you know that was one thing that when it just exploded a couple of years ago, it was kind of similar to I wanna say social years earlier where, to your point, we’re all going to do it. We’re all going to jump up on these platforms. Oh yeah, now we’re all going to do…because we’re all doing inbound because you’ve got to do that, right?  

And so I think what I’ve really appreciated from folks like HubSpot or Marketo is that they also and they’ve engaged us on some content, which we love doing, that they get it too and they see that look, it can’t just be about inbound. And so yeah, I think the answer, to fully answer your question, I mean for us it’s got to be about every channel and it certainly is the way that we work for our own agency clients. And it’s the way that we’ve built this business.  

So I think from day one, even before it was called inbound, and certainly, we’re not the only ones because you have been doing it. And I think for us we realize that ultimately prospects you have to hit them where they live. And if all you’re doing is banging away on the phone or just creating content but you’re not really doing much els