Dialing in your biz dev strategy for 2024 with Lee McKnight Jr.

Hey, before we get to the show, I just wanna remind you that we have created a private Facebook group just for you, our podcast listeners. There are almost 1500 agencies, agency owners, inside that Facebook group every day talking about what’s going on inside their shop, asking for resources, gut checking decisions, talking about everything from pricing to hiring, to biz dev. All kinds of things are happening there. We’re starting conversations. You guys are starting conversations. What I love about it is the community’s coming together and sharing resources, encouraging each other, and just sort of having a safe place to talk about what it’s like to own an agency. So all you have to do is head over to Facebook, search for a Build, a Better, Agency Podcast group, or Build, a Better, Agency Podcast.

And you’ll find the group. You have to answer three questions. If you don’t answer the questions, we can’t let you in. But they’re simple. It’s, do you own an agency or do you work at an agency? And if so, what’s the URL? What are you trying to get out of the group? And will you behave, basically? So come join us. If you haven’t been there for a while, come on back. If you haven’t joined, join into the conversation. I think you’re gonna find it really helpful. All right, let’s get to the show.

Running an agency can be a lonely proposition, But. it doesn’t have to be. We can learn how to be better faster if we learn together. Welcome to Agency Management Institute’s Build, a Better Agency Podcast, presented by White Label IQ. Tune in every week for insights on how small to mid-size agencies are surviving and thriving in today’s market with 25 plus years of experience. As both an agency owner and agency consultant. Please welcome your host, Drew McLellan.

Hey everybody. Drew McLellan here with Agency Management Institute, back with another episode of Build a Better Agency. Super excited for this episode. We’re gonna talk about biz dev, how challenging it’s been in 2023, and some things, some glimmers of hope and light for 24, and some things that you can be thinking about as you do your year end planning. So another thing I wanna, I want you to be thinking about as you do, as you do your year end planning and your forecasting and planning for 24, you know, we have a one page business plan that will help you really think through what are the priorities for 2024. So we’re gonna put a link to that one page business plan in the show notes.

So head over to agency management institute.com and go under resources and the podcast, and you’ll see it right there in the show notes. You can download it. It is, like I said, it’s, it’s one page. It will allow you to think through the priorities and really get clear about you can’t do everything. You can’t fix it all at once. What you need to fix, what’s gonna make the most difference in the business, and in what order you should tackle those things. So go grab that and, and use it with yourself, with the leadership team, whatever you need to make 2024, a really banner year for you and your shop. All right? So let me tell you a little bit about our guest. He is very familiar to most of you. Lee.

McKnight works for RSW. He has been a guest many times before. And as you all know, RSW is a company that comes alongside agencies and helps them with their biz dev program. They’ve been a great sponsor at the summit. They do some amazing research every year, and actually, they just came out with their 23 research about the biz dev situation, how other agencies are faring, what’s been in the way, what’s working. And so I knew I wanted to get Lee back on the show to talk about the most recent insights that they gleaned from their, from their research. They were also just featured in Adweek.

And boy, that article made it sound like we all should just close our business and open up croissant bakeries. So the good news is Lee’s gonna give us a more balanced view of what has happened this past year and what he thinks is gonna work in 24. So, hang in there. It’s not as gloo doom and gloom as it may feel, or as the media may, may, may be making you feel it is. And Lee’s gonna help us sort of see the light in that. So I’m super excited to have him on the show. Alright, so let’s not waste any more time. Let’s welcome to the show and let’s dig into the data. Lee, welcome back to the podcast. Always good to see you.

Yeah, Drew, thanks so much, man. It’s great to be back.

So you guys just came out with the latest piece of research that you do and you do it every year about new business, and you got picked up in Adweek. And boy, like journalists sometimes like to do, they picked out the foremost horrifying factoids out of the research and sort of put the spotlight on that. So yeah. Yay for the coverage. But yes, b, when I think about the research, there certainly were some glimmers of light and opportunity as well. So what I wanna do is I wanna talk first about some of the realities of what you guys saw in the research and you’re seeing in your own work around how tough 23 was for a lot of agencies Yeah.

To get new clients and what ad we kind of focused on. And then let’s talk about what, what are the opportunities as people are starting to think about 24? So let’s, let’s start with the bad news first. What, what were some of the things you heard from agencies around the struggles of 23?

Yeah, yeah. Well, well, again, I mean, thanks for mentioning that and, and it was great to your point to get that pickup. Yeah, I, I was actually interviewed Drew, that’s how I’m, I’m up there now. Wow.

I, I’m feeling pretty, I’m feeling pretty special that you made time for the little people like me.

She should, yeah. And my wife, my wife points that out too. She’s like, oh, really? Great. Now go take the trash out. Right? But no, I mean, in all seriousness, it, it, it was good to get that pickup and, and the stats that were there are, are real stats accurate. Right. But at the same time, a hundred percent with you, I wrote that report, you know, and I wanted to make sure that it wasn’t all doom and gloom because it’s not. Right. The way I look at this is, we just talked about it offline. This is the cyclical nature of this industry and the fact that there, there is reasons for optimism. Even now at the end of the third quarter, we’ll get, get into this, seeing our own agency clients, and then just talking to agencies that it’s loosening up and we’re seeing Yeah.

Some solid closes. So I definitely want agencies to take away from that Adweek article and our report, take this as, let’s take a step back. Where can we plug holes or where can we, in terms of business development, which is where we come from, obviously, what can we be doing? And I think some of these are gonna be a little eyeopening, but at the same time, what I’ve heard from a lot of agencies, you know what I felt validated by your report. Maybe that’s a little cold comfort in some ways, but Right. I I, I do hope you take that away too, agencies listening, because it’s not just you, all of us, it’s been a weird year. Yeah. But we’re gonna get through it. And so, but let, let’s do, let’s talk about some of these. I think, you know, the, the first one maybe is the fact, and, and this is the one that’s gotten a lot of play, is that 58% of agencies said it’s been harder or a lot harder to obtain new business so far this year.

Yeah. And, and what we didn’t love seeing was in, in 21, it was only 28%, you know? Yeah. And, and then in 22 went up to 43. Okay. A little bit of a jump, but now we got another jump. Yeah. And so I think the pandemic, the log jam opened and we saw a lot of agencies get a lot of business that was sitting there.

Yeah.

And now it’s evening out and getting in a weird place because marketers are holding back. And we, we can look at that here in a minute, but I think that I’ll throw that out first. And, and some of this is not new at all. Yeah. It’s, of course it’s hard. But But it has gotten harder this year. And that’s, that’s, that’s the first big

Takeaway. I, I do think, and, and you know, we’ve been talking about this a lot with agencies in, in our content and newsletter too. You’re right. It is cold comfort, but for a lot of agencies, it is a relief to hear that it’s not just them that others are struggling as well. And you know, I think one of the, one of the things I think we’re seeing is agencies came out of Covid, many of them having a great 21 and an amazing 22. And they got, because there was a lot of demand for their services, we saw a lot of price increases. We saw a lot more sort of choosing to say no to prospects, which I’m a big fan of.

Sure. But I think some in someti in some ways, we might have swung the pendulum a little far. Right. That’s a great point. And so we were a little fat and happy and full of ourselves. Yeah. And that crashed into the economic situation we’re in the political unrest that we’re seeing and some other external factors that caused the market to go, oh, this feels uncomfortable. And so yeah. Our, our eagerness to sell at a new price point and our feeling like things were pretty awesome combined with the discomfort that the market was placing, I think made things even worse.

Yeah. I think that’s an excellent point. And you know, it, it is, and I agree with you in the sense of being picky and making sure that you are getting commensurately paid for you and your team, what you should be always, you know, the mantra. And so it’s a little tough this year, and we’ve seen some of our own clients do this and agencies where it’s like, okay, you know what? We’re gonna be willing to take this lower fee understanding that it is still in our wheelhouse. Right. And I think that’s so critical, right? It’s not just, okay, we’re gonna do this website for five grand, God, why are we doing this But? It’s okay, here’s opportunities to land and expand potentially here. Okay, we’re gonna take less. Maybe this is a paid test that we wouldn’t normally do.

And I’ve seen agencies have success with that over this past year. And maybe that’s a little tough. But I do, I I, I love the way you, you put that, that the pendulum maybe swung a little bit too far that way. And so that’s gotta be, it’s gonna be tough to take.

Well, and I, I think you’re right. I I, I do think agencies were, were more willing. So first quarter I think they sort of stuck to their guns. Yeah. By second quarter, things were getting really tight. Sales cycles were taking a lot longer. They were also getting yeses and then basically just a pause like,

Well, that’s the thing, right? You,

You said, yes, but I don’t actually have any work and I don’t have any money and I don’t have anything to invoice. Right. So, great, I won the business, but I don’t actually have the fruits of that. So then, then I think we did start to see people going, okay, we’re gonna do more project work, or we’re gonna, you know, change our pricing model, but it’s gonna take a couple quarters for that to catch up.

Catch. Yeah. Yeah. I think what’s interesting that dovetails to another stat was we had 75% of agencies tell us the average time it takes to move from a first meeting to close in 2023 to date, they were saying 75% one to six months. Yeah. Which is generally, that’s kind of what we see. Well, actually, there’s some optimism here, because last year in this, in our report, it was 85%. So it’s interesting. But where we also saw some changes was those agencies that said less than a month dropped from 11 to 7% and more than six months rose from five to 18%.

Yeah.

So it’s this rollercoaster that it, it really was kind of a weird different year where it has generally taken longer. And I, to your point, I think agencies weren’t quite prepared for that hitting Q2 and Q3. So it’s a little jarring,

I think. And, and I think, you know, you get a new client and, you know, 60 days later or so, in theory, the money starts coming in and, you know, we had agencies that the client awarded them the work, signed the contract, and then hit pause for 90 or 120 days before that first project. Yeah. So that means the money’s not coming in for six months. So again, to your point, I just think it caught everybody off guard.

Yeah. Yeah. I, I think that’s exactly right. And I think, you know, moving into two other stats that kind of dovetailed into each other as well, we had 38% of agencies that reported a decrease in new business opportunities this this year versus 26% in 22. Also, agencies said the main reason that it’s been harder to obtain new business in 23, similarly, or exactly the same, fewer opportunities out there. Yeah. At 61% up from 39 in 22. But, but this is one of those areas where I’m not taking away the real challenges agencies have been facing over the last quarter or two. But here’s where we get into some of this is in your control.

That’s right. Yeah. The pipelines were thin, but again, you were coming off this big year, you had lots of clients and lots of work. And so I think, you know, like many agencies do, they have sort of this feast and famine model of new business development. When, when the coffers are a little dry, they’re, you know, pedal to the metal in terms of efforts to get in front of prospects. And when they’re feeling a little fat and happy, then, you know, they ease up on that because they just don’t have the bandwidth to keep at it. And you know, the pipeline’s gonna show that, right?

Yeah. Yeah. And that’s exactly it. I mean, and, and I know you as well as, as, as we, small mid-size firms are, are really where we play. Right. And, and where we focus. And to your point, it’s a, it’s a singular issue and challenge. You can throw out accomplished children, whatever you want, but it’s, I hate that.

True, but Yes. Right.

I know. It’s awful. And it’s so te we have to find, I’ve, I’ve looked for a new one actually, but interestingly, agencies keep giving it back to me and they’re like, all right.

Oh gosh. Yeah. Right. We can keep going But. It’s the number one excuse. Right?

Yeah. I mean, clients do have to come first. Sure. But I think one of the things I’d point out is you are going to think there are fewer opportunities if you’re not pursuing opportunities at all.

Right?

That’s a tough pill to swallow. And you gotta look in the mirror and say, okay. And, and it, it is easy for me to say, and it’s not to be self-serving ’cause we’re a business development firm, but I’ve always said, and and I’ve heard similar from, from you and other folks is that it, it, it’s, it’s just getting a plan in place, even if it’s baby steps, but something you can follow that understandably, you’re not, if you’re a principal, you’re not gonna be able to put x amount of time against it. It’s just not possible. But there are ways to make that work, and we’ll get into hiring here in a minute. But, you know, I think ultimately it, it, it, it’s something again that I think caught them off guard

Yeah.

There in the Q2 and Q3,

You know, and, and, and yet it, I think, I think the severity is what caught people off guard. The, the pattern is the pattern, right? I mean, we’ve seen boom years and, and down years and, and it, you know, most of the people listening, you know, to this show have owned their agency for probably a decade or more, and they’ve ridden the cycle. Right. You know, it wasn’t just a covid thing and there’s always gonna be an economic downturn and there’s always gonna be, you know, political challenges. But I think the severity of all of it, especially coming off a couple really good years, the drop was significant.

Yeah. And I think that two stats that feed into each other too that aren’t gonna help other than just like, yeah, we know. But you know, they, agencies said the second most predominant reason why it’s been harder to obtain new business in 23 so far, prospect budgets not, not current client budgets, even though that, that in and of itself we can talk about, but prospect budgets are just too small. 55% of agencies said that on top of that, 41% said a dollar volume of new opportunities decreased relative to last year.

Right. Right.

That, that’s tough. Right. Obviously. Right. That’s because that’s one where it’s like, your control there is very limited. I mean, there’s things you can try to do, but with prospect budgets, like, this is what it is coming in. And that goes back to what we talked about here just a few minutes ago. Are we willing to take, are we willing take a project at, at this versus last year where we would not have considered that?

Yeah. And again, I think that’s part of what we saw in the first half of the year was, you know, a lot of agencies are saying, it’s not that we can’t have conversations, but we’re having conversations about projects and budgets that we normally would just say, you know what, we’re not the right fit. And for the first part of the year, that’s what they did until they realized the right fit budgets and prospects weren’t out there and weren’t looking. And so then they started to scramble to try and figure out how can we deliver on a $75,000 project when normally our minimum is 200,000 or, you know, whatever the scale is. Right?

Yeah. And then they’re just diminishing returns Right. At some point. Right. But I think, you know, one of the things I’ll throw out from a business development standpoint that plays into the past couple of stats that we’ve just been talking about, you know, is it’s never been more important to, at the forget true outbound for a second, and that whole process and how that engine has to keep running it all, it all does. But I think the biggest thing there is agency so often it’s that follow up piece, right. That really falls apart to where, okay, now it’s taking longer even to get in the door to your point, okay, now we’re in the door, but there’s that pause. I think a lot of times agencies think, well, I don’t wanna bug ’em, or we’re just let this play out.

Don’t necessarily in fact don’t do that. Right. I mean, figure out ways to stay in their purview in a meaningful way. Because the worst parts are these sales emails that we all get. Right?

Oh my gosh.

Right. You know, it’s, it’s junk or I’m just checking in, or Right. Recently, I don’t understand the, let me buy you a steak. I’ve got like five of these, and I, I guess I’m just gonna start letting, I’m just gonna start letting ’em do that, I guess. But I,

I, I wonder how that works, but, okay.

I don’t know. I had one that just kept adding, okay, I’ll throw in the apps and I’m like, I’m, I’m getting appetizers. I mean, obviously,

Right? Yeah. Right.

Yeah. These sales emails and the outlandish guarantees and we’re getting off track here. Apologies, but that’s bizarre. But I, I think, you know, agencies, you have it within you. It doesn’t mean you have to write the type of content Drew that, that you release ongoing, or that even We do. And, and we, we can get into AI here in a little bit. ’cause those are the last two questions we asked, and it was pretty interesting, right. The two answers we got. But I think that there are just ways to make those processes more efficient for you, where you can stick with these potential clients Yeah. Again, in a meaningful way to show them here’s what it’s like to work with us before you ever do, you can’t let them forget you. Yeah. So I, I can throw that out. I think,

Yeah. I, I, you know, I think, again, what what’s interesting is a lot of agencies are getting ghosted, everything’s taking longer. Yeah. But when the prospect is ready, they’re, they’re ready now. And so we have to be able to respond very quickly. And to your point, if the, if the window is six months or longer from first conversation to close, we better be having meaningful, valuable to the prospect conversations in between the first meeting and the six month close meeting. Otherwise we’re not gonna get to that six month close meeting.

Yeah. Right. It will. Exactly. Exactly. Yeah. What well put, and I think want to get into the hiring piece of it, but one other, you know, stat I’ll throw out is, you know, we also ask predominant methods for agencies to gain new business. You’re not gonna be surprised, nor were we for the answer. Number one, it was referrals. Sure. Not shocking. It was 69%. It has always been, that has been number one since 2010, right? Yeah. Right. And what’s interesting though is we had two or three open-ended questions where agencies were able to put one or two sentences around the, you know, to provide context. And more than one said, you know, what referrals are are slowing for the first time in a long time. Yeah. And, you know, it’s just one of those things where, look, referrals are fantastic.

Any new client we have that comes on board, we wanna make sure that keep that process in place. of course. Why, why wouldn’t you? Right. But you get into the sole reliance on referrals, it can be a tricky path too. They’re not reliable, and that’s just one of the pieces of it. But

Well, it’s a scalable, it’s not reliable. Right. And you have to eat whatever swims into the net. Right? Exactly. So you can’t actually build the business that you want to build. Yeah. When the only way you get clients is referrals. I get it. You’re further down the sales funnel, they already know you and at least have a sense of who you are so you can get to the close faster. So to your point, you don’t say no to referrals, but you gotta have something that is more deliberate and more in your control than that. Yeah.

Yeah. Exactly. And so, I, I just wanted to throw out that referral piece again. It, it’s something that every year, it’s always the number one. And I, and I think it’s just good to, to beat that drum to say, yep, that’s great. But to your, all your points, you, you, you’ve gotta have more more than just that. Yeah. You wanna get into hiring. I mean, I think that that’s, that’s kind of the, gosh, the, the thing that plagues agencies, I think two key stats there, you know, hiring for the new business director position at an agency at its second lowest level. Since we started this report in 2010, it’s 36% of agencies hired a new business director in the past three years. Yeah. Last year it was 32%. So a little better, but not much.

And then the average tenure of a new business director hired in 20 23, 20 9% said less than a year. 23% said, said one to two years.

Yeah.

Again, some of this, not surprising, but it’s, that’s a tough road, you know, and a lot goes into that higher, I do think agencies and I laid it out in the rapport, you know, four ways that agencies, you gotta think about when you’re making that hire.

Right.

Some key things that, that ultimately, if, if you don’t, I mean it’s, you know, it’s what we’ve heard before, Drew. It’s, you know, that they’re hiring for a person’s network, which eventually runs out. Right. They’re hiring green and they’re thinking, we’ll train ’em up. That can work

If you’re willing to give them the time and attention. Right. Exactly.

Yeah. Because you have

To. Right.

In other words, they just don’t dig deep enough on, I always say, if you’re gonna hire for that position, ask them what their, what, what does that plan look like? Right? What’s this process? What is it going to be? ’cause a lot of times they may not have that in mind. It’s like, whoa, wait, you, you better have that. Why am I hiring you? But

I think a lot times they take the job thinking the agency already has it, which they don’t.

Oh, so true. Yeah. And, and, and they don’t. And that’s a, that’s a lose lose for both parties there. Yep. And then lastly, what I point out is just def on the agency side, defining that position upfront. Yeah. Are you expecting this individual to answer RFPs, write proposals, figure out what’s the prospect list look like? Are you doing all the outbound and, and it goes on and on. Yeah.

Are, are they defining your ideal fit client? Are they just handling inbound? Are they right? Oh gosh. Yeah.

Yeah. And, and for one person to do all that is possible, but man, you’ve gotta be almost superhuman. And, and they’re out there, you know, I mentioned they’re not unicorns, but if it all falls on their plate, you better, you better lay that out because, you know, so I think just in terms of hiring it, it get a little self-serving. That’s why we exist is to help agencies do that. But I think it, once again, it, it just shows that, I think, again, post pandemic and hiring was so tough. And I think it was a little bit of a buffet, maybe a little bit of exaggeration for new business directors. We’re able to pick and choose kind of where I’m gonna go. And now it, it’s interesting. I, I think agencies feel like, all right, we’re, we’re pulling back again.

Or, and, and to be fair, maybe not giving those new business directors enough time. It’s

Tough to say. Well, you know, that’s, I, I think it’s a couple things too. I think, I think first of all, when an agency hires a new business person, there’s this huge sigh of, of relief from the owner thinking that that’s now off their plate as opposed to, right. I have to partner with this person and be available to them to mentor and coach, but also to be, to be able to attend meetings and do the things. And, you know, so I, I think a lot of agency owners abdicate the whole responsibility and really do put it on this, on the salesperson, which is probably unfair. And number two. Yeah. You know, we’re always saying, look, if they can pay for themselves in a year, that’s amazing. But they’re gonna need that year to get up to speed, to learn the stories, to learn the case studies, to be able to have the conversations, to understand the questions, to ask, to be able to know who from the agency to pull into at the right time.

And just to sort of get all the ducks in a row. ’cause in most cases, they’re not walking into an agency that has a well-defined, well-tested, new business outbound effort that they can just manage and milk. They’re usually creating it pretty much from scratch and on their own.

Yeah. I think that’s such a great point. In terms of the mentoring and, and just making sure, you know, I always, I, and I hear this still today when I agencies I’ll talk to that say, you know, we had a new business director, it didn’t work out. You know, they just never really understood us. Or, or some version of, they just didn’t get us. And I’m like, wait a minute, how is that possible? Because Right. That’s got, that’s a two-way street for sure. But that’s on you to a great extent. Now maybe they just crapped out and that was, you know, okay. It wasn’t just the agency, but my gosh, they they better get you, they’re selling you, I mean, they’re representing you. Right. So I’m always a little bit shocked when I hear that, but I understand. It goes a little deeper. It’s not quite so, so cut and dry. Yeah.

But I’m always like,

It’s, it’s a tough position to hire for sure.

It is successful. It totally is. Yeah. It really is. So I think agencies just, I hope from the report and that piece of it, that it just helps to take a step back and think about when you’re, if this is what you’re, you’re going to do, embrace it. But you really gotta think about, okay, what, what type of questions and what are we gonna be doing when we’re looking to hire this person?

Yeah. And it’s not just a money investment, it’s a time investment.

Correct. Yeah. It, it truly is. And that, and understandably very tough for small midsize agencies. Yep. Totally get it.

Okay. So we have talked about a lot of the things that are hard and challenging. So let’s take a break and then let’s come back and talk about the upside, the glimmers of hope, the what we can do differently as we, as we plan into 24 to not have to repeat the pain of 23. So quick break and then we’ll be back. And then Lee will tell us some of the things that he and the team at RSW gleaned from the report, from the survey about what we can do different. And I for sure wanna talk about AI as well. So we’ll be right back. Hey there, just a quick interruption. I wanna make sure that you are aware that you are cordially invited, not just invited, but cordially invited to join our Facebook group, our private Facebook group.

All you have to do is go to Facebook and search for Build a Better agency. And you’ll find the Facebook group, you an have to answer three quick questions. You have to put in the agency, URL, you have to talk about what you wanna learn from the group, and you have to promise to behave yourself. And that’s it. And then we’ll let you in and you can jump into the conversation with over a thousand other agency owners and leaders. And there’s a robust conversation happening every day. People are sharing resources and best practices and discussing everything from work, from home policies, to maternity and paternity policies, to biz dev strategies. So come join us and jump into the conversation.

Right. Speaking of conversations, let’s head back. Okay, we are back. So doom and gloom, front half of the show. Let’s finish up with a Broadway song or two and a dance.

Absolutely. Okay. Some flowers, some cocktails, you know, whatever. I

Like that. Yep.

Yeah, no, I, I, yeah, I think definitely I, I do want agencies and, and you know, I’ve got a, a blog post series that’s on our site that where I, what I’m, my goal and our goal as a company is to, to say, look, there are reasons for optimism. This is a cyclical nature of where we are. And I, I quoted a few reports outside of ours I took from Adweek and Adage and some other places where, you know, a lot of these folks are saying, look, this is cyclical and these, a lot of these marketers pulled back when they really didn’t need to, which is frustrating. But at the same time, understanding that we do see some optimism. I mean, I’m, we’re already seeing, as I mentioned, we’re already seeing some just in the past two weeks from our own clients, some really solid closes at some nice dollar volumes that they were a little bit lower two quarters ago.

So I think absolutely this is the time for agencies, especially in this last quarter, to really look at what they’re doing, you know, reprioritize, if that’s the case. ’cause ’cause there, there are reasons to be optimistic. Absolutely. Yeah. And you know, I think one of the things I lay out is just let’s look at from a business development standpoint where those prongs, and I know Drew, you talk about the stool and I love the way that you describe when you get into business development is, is fantastic. And I’ve heard it many times and every time I’m like, I wanna take some pieces from that and steal them from you. I’ve had it and sometimes I have, I’ve at it. But I think, you know, those kind of four pillars in this case of organic growth, this is where I quoted you, you know, one of the things, and you talked about, as I say I’m reading you right now, is Drew McLellan on a ami deposits, 65 to 70% of your net new revenue should come from existing clients.

Right? Right. That’s something you gotta look at and revisit, you know? Right. And really show that, show that worth two with referrals, like we said, gotta be a part of it. But let’s think about how much you’re placing and the value you’re placing there, where quite frankly it’s just, well, because it’s easy and they’re coming in ’cause it’s a referral. Right.

Right.

The third is just not just But, it’s inbound and it’s content. And this is where I want to touch on AI for a second, if I may. I think really one of the things that agencies I know have struggled and do struggle with that, that inbound piece and that content piece forever, there’s never been a better time or I hate to use the word easy, but a time where there’s more efficiency than ever. Yeah. And I know that AI scares well it scares me too, actually. But, but we are embracing it and I think it’s something agencies need to do too. And I’ll tell you what I thought was really interesting. So we asked two questions on AI this year, the brand new, one of the results was we asked them, are you using it for business development at all? And only 38% said they are.

That’s still not a bad number. No.

Right. That’s good.

Yeah. And I think what our MBDs are doing, some of the things that I’m doing is going into chat GPT and able to do some research on agencies or companies. I don’t like, you know, I I, I did the experiments. A lot of it’s probably have, write me a blog post around this, you know, with, with stats. I do not write that way. Right. That is not the mixed metaphors But. it does help to structure and form what you’re doing and really cuts the time in half in some places. Right. So I think for agencies that struggle with that, you don’t have to have the blog necessarily. That’s great. Just post it on LinkedIn two or three times a week to get that awareness. I, I, in terms of your expertise is huge.

Yeah. And I, I really encourage agencies to get more into that and experiment with that. But what I thought was really cool was 70% of agencies said they’re using AI tools for client work. I thought there was a big percentage. Yeah. And I was, I thought that was pretty cool. I mean, and now we don’t delve into exactly what that looks like. Right. But I’ll throw that out to you. I’m talking a lot. But I think that that AI piece was really interesting to me.

Well, you know, we’ve been doing these sort of ad hoc, we’ll we’ll do a webinar and we’ll, we’ll get three agency owners on who are using AI in some way. Oh, that’s okay. And then they just, they each take 15 minutes and demo it and then we, then they answer questions and we’ve done I think four or five of them. And you know, we’re just constantly reaching out to a MI members and people who listen to the podcast and say, Hey, if you’re using AI and you’re willing to share it with other people, you know, let us know and we’ll put together another one. But what’s been interesting is, in the beginning it was all chat GPT and you know, mid journey and client stuff. But now what’s really interesting is the last one we did in September, it was much more about how they’re using it inside the agency for efficiency like HR and some, some other tools.

So I do think we are going to start figuring out ways to use all of the tools. And by the way, there’s a new freaking tool every day. Oh

My gosh. Yes.

But we are gonna start figuring out how to use the tools not only for clients, not only for biz dev, but also for just running our business. And so it’ll be interesting to see, like that’s a stat that’ll be really interesting to see how it jumps next year when you do this research research. Because I do think agencies are just at the point now of like having a little task force or playing around with it. But I do think we’re gonna start seeing it being really rolled into day-to-day operations much more in the next 12 months.

Yeah. Yeah. That’s interesting. I hadn’t thought about the internal usage and that, that makes sense. But you’re, and you’re right, I mean it, you can get overwhelmed by the new AI tool every Yeah. Single day. Right. And that those shiny objects can be tough for agencies. Okay. Which, where do we go with this? Right. But I think it seems like, you know, there’s, these are smart folks and they are gonna figure it out, you know, so, and I mentioned those four pillars that organic growth, referrals, inbound, you know, and content. And then of course the outbound piece, the hardest piece for agencies to do. You just have to already mention it. You know, there just has to be a way where you’re at least have some kind of process in place. And it doesn’t have to be that you’re pounding the phone or emails or whatever it might be all day long.

’cause you can’t do that. Right. Especially if you don’t hire anyone or use someone like us to again, hey, there’s a commercial, but agencies can do it. I think it’s just a matter of we have to have a plan in place that is reasonable and that we can follow.

Well it also has to be realistic in terms of how many people you have to talk to and how many clients. You know, we do an exercise in one of our workshops where we take the workshop attendees through a budgeting exercise where we say, okay, here’s where you are at at, you know, December 31st of last year. Let’s assume you’re a healthy agency. So you’re gonna have 10 to 15% attrition year over year. So here’s your net new Now if you wanna grow 10 to 15% year over year, ’cause more than 20% odds are you’re gonna break everything inside the shop. Right. It’s easy to grow 20, 25% or double in size when you’re two or three or four people by the time you get to 20 people.

That’s a burden. Right. But we do the math and it’s like, you don’t actually need as many new clients unless, unless you’re talking to people who are way too small for you to be talking to. Your outbound effort should be pointed at people who are big enough to be significant to the agency. Yeah. Which means, you know, you gotta win, what, three maybe a year for you to have a great year to cover the attrition, cover your goal of, you know, 10 to 20% growth. So how, figure out how many people do we have to talk to to get three yeses and then sort of back that up and it’s not, it’s not millions and it’s probably not even thousands.

Yeah, very true. Yeah. And I, I think if, if any folks listen to this podcast, know your content and the ways that you help agencies, if anyone’s coming from the RSW side, if you’re not familiar, familiar, I think what I love about what you do Drew on the content side, especially to a MI, is you do get into that budgeting and a lot more than we ever do at RSW. And I think that you, it’s really important for agencies to get into and it’s, it’s, it’s doable. Right. Right. And I think for some agencies it can be such a, they can get kinda lost. So I would encourage folks to go, you know, to Drew’s content because it’s, it, it will be a big help, especially as we talk about the things you can do to plan for 2024.

Right. Moving into next year. Right.

Which is exactly where I was gonna say, so for you, what outbound efforts are working, how, how are agencies initiating relationship and conversation that you are seeing are, are really working?

Yeah, I mean it’s interesting. What’s old is new. Again, if, if folks have heard me before, I, I will say that interestingly, you know, where we obviously where folks are gonna see the glut is, is email of course. Oh my gosh.

Yeah. Right.

We talked to you, we just mentioned it earlier. I mean, it isn’t crazy to me. These legion firms that pop up, you talk about different AI tools every day. I think there’s six legion firms a day, literally. And so much of the outreach, I’m sorry, is junk. And I’m not knocking any one company at all. Yep. of course not. There’s zero value. You obviously haven’t done any homework because if you had, you would see that these emails, I get, you know what, I’m your competitor, I guess you could have taken two seconds and I know it’s, it’s a bot or they’re just trying to see what sticks. I think agencies that will just reach out talking about email specifically at this particular point, you just show that expertise or that you understand any of their given broad challenges.

You are 80% of the way ahead of most of the stuff they’re getting. Right. If not more. Right. But for us, I’m telling you, it’s interesting. Phone and physical mail, a little bit old school, I don’t wanna say there’s a renaissance that would be far too exaggerated a term, but we’re getting a lot of meetings through there, you know, and it’s really interesting physical mail we had to slow down on during the pandemic for obvious reasons. And I see a lot more agencies telling me not even knowing what our process might be at that point. It’s interesting you say that ’cause we used to do a lot of that and we’ve just now kind of we’re getting back into it. Right? Yes. People, there’s, it’s hybrid, but they’re getting, they’re getting that. Yeah. Now it may take a little longer.

Well, you know, people still get mail even if they’re working from home. They do. They, you know, somebody has to get bills to them and other things. Yeah. So your stuff will get there too. But I, I do think your point is the inbox is packed, but the mailbox is empty. So it’s a place where you can actually get noticed.

Yeah. And digital firms will tell me like, we’re a digital firm, why would we do that? I’m like, I’m telling you, it doesn’t matter. It, again, if you’re not using all those cha any channel at your disposal, why not use it? Because if not, you may be leading opportunities, you know, on the table. Because there are still individuals that will answer a phone call, believe it or not. Right. Right. But, but some, they’d rather they’re never gonna do that. Right. But that’s why Okay. We still have email and then LinkedIn, which interestingly I was about to sign off on that forever aware. So, and we’re still getting so many cold LinkedIn sales every day. Yeah. But again, it’s another tool where if you use it correctly and you have a certain level of permission, it still works quite well. And so that’s the biggest thing that I can tell agencies listening in terms of what’s working for us is our new business directors, you know, and, and we work hard to hire.

And I, and I granted it, it’s hard for us too, but our folks will typically have 15 to 20 years of sales and marketing experience. Because when you reach out to a decision maker and you’re talking to a VP of marketing, you better be speaking their language. And whether that’s us or, or internally or what have you. And I think agencies have that knowledge. Right. Right. And I think sometimes they just don’t realize it’s hard. But how to employ that in a way that’s like, you can speak that language. You’re doing it every day. Right. It can translate. So I think for us it’s making sure that we’re looking at all these different pieces and you don’t have to spend, you know, the zoom infos of the world, God bless ’em, that’s an expensive tool. It’s a great tool. And not to single them out, they’re, they’re quite good.

There’s others that are also good, but for agencies you can, there are ways you can do this without having a huge outlay with so many of the free tools that are already available out there.

Yeah.

And so I

Think it’s, and again, you don’t need a list of 10,000 people.

Correct. That is absolutely true. ’cause agencies feel like they, they do need that. Like I’ve gotta have, we’ll know ’cause like we’ll go after about 80 companies in, in any given month. Right. So you can go after what you might consider smaller numbers, but to your earlier point, if, if they’re right fit, how many new clients do you actually need? Or,

Or, so I think that’s a, could you onboard? Right.

Well great point. Absolutely. Yeah. And I, and I think that’s, that’s a really good takeaway here at the end for folks to, to think about that you already mentioned is, is how many you actually need. Do that exercise and that math and then realize that you know what, this, you can do this. ’cause you don’t have to reach out to a thousand people in a week or what or what have you. Right. So I think that’s a great point.

So as you are working with clients and looking at 2024, what are the, what’s it, what’s in the minefield that we need to not step on? And what are the couple things that you’re like, look, I I I think part of this too is agency owners are tired. It’s, they’re fatigue. This has been a tough year for a lot of them. You know, interestingly, one of the reasons why it’s been a tough year is, you know, people came out of Covid and were hiring anybody who could walk upright and breathe. Yeah. And they’ve gone through a lot of those employees. And, and one of the challenges for agencies that we’re seeing, I’m curious if you’re seeing it in your clients too, is biz dev has been tight and slow, but they’re saying they have one of the best teams they’ve ever had.

And so Yeah. They’re loathed to skinny down the staff, perhaps the way the numbers suggest they should. So they’re willing to ride the wave, be less profitable this year. ’cause they just don’t wanna get rid of the great team that they have. Yeah. So given that they’ve got a great team, that they’re coming into a new year, what, what are you, what are you recommending they avoid? And that if they’re only gonna do one or two things, because I also think we try and do everything. Yeah. And then we don’t do anything well and we don’t do anything consistently or for a long enough period of time. So if I’m gonna avoid a couple things, and I’m gonna do a couple things, what is the data and your own experience with clients and what’s working?

What are, what, what are you telling folks?

Yeah. Great questions. I, I think the minefield that you mentioned first, I, I think we’ve touched on it But. it is, to me it’s, it’s, and I just had this conversation with a new business director yesterday. One of ours is we need to take a step back moving into 2024 and let’s a a and I think where agencies, to your point, trying to do everything you’ve gotta take, that’d be tough to take a day, take a half day where you are literally taking a step back and looking at the building blocks of the agency. Now I’m speaking business development is what we do. So there’s other pieces that might fall out, fall out what I’m saying. Right. But I think that one of the things, and, and it, and it keys off what you mentioned because I’ve seen that too, right? Like we have a great team.

I think one of the things in terms of business development is if, if, if hiring someone is just not gonna be in the purview right now, agencies have to make business development and agency-wide pursuit. Yeah. Understanding that not every person is literally going to touch it every day, even though quite frankly really they are because everything they’re doing in one way or another, i i is part of that business development process. But I think especially now working from home and, and, and where we all are Yeah. Is, is still a challenge for some agencies. I think others are, are thriving. And I think, you know, agencies were probably more ahead of the curve than almost any industry. Someone can maybe call me out that there, there were others, but I they were already doing a lot of that. Right. Yeah. But I think that I I I think they have that nailed down to, to a good point.

But maybe what they don’t is that business development piece. So I think in terms of just looking at it holistically, it sounds too lofty when I say that, but, but I think it’s kind of true, is Yep. Taking a step back, the minefield would be trying to do too much. I agree. And, and the shiny objects and thinking that we have to have this many tools. Take a step back and, and talk to folks like you or even, or folks like ourselves even to look at, okay, what, what really do you need? We need that down and look at how can we make this work and still be profitable and understanding that these are the things we need and, and, and that we don’t. You know, what I loved was one of your recent emails about, you know what, we took a step back and accounting wise and looked at the things maybe we weren’t using and how much money we saved

Was. So that was great. Was so painful.

Oh, but you know what, that’s a one of the best pieces of advice I’ve seen in months. Like, God, you’re right. Right. And if y’all haven’t seen that go, I mean, and you know, Drew’s just talking about, and you can do it in your own life, right? It’s like, how many streaming services do I have and I’m not white watching three of them. Right. That’s a very micro example, but they add up. But I think that’s another right. They do. And that’s another piece. I think that it can be part of this even from business development, but just agency-wide, I think in terms of what, what’s working, you know, so, so in terms of minefields, we, we touched on that moving into 24. I think we’ve touched on it to a great extent. And, and that is just, again, taking that step back and looking at those four prongs that I mentioned and looking at especially number one, who is gonna drive this train.

Yep. You know, I think that somebody’s

Gotta own it.

Somebody’s gotta own it and it’s gotta be, well I almost said it’s gotta be one person. You know, we’ve seen the team approach that can just fall apart at the seam because Right, right. They come to a dead standstill. What about these case studies? Okay. Which are important. But I think that’s one of the biggest things is take a step back and look at who is gonna drive this train. Yep. You know, and, and once you go from there, you’ve gotta lay out and get a calendar and look at how we’re going to do this and go by quarter if you must. But look at in terms of business development, these four pieces and where can we Okay. AEs in terms of organic and just making a plan. I think that’s the biggest thing. And I, I hate to, I point this out in the, in the report at the, at the end.

And part of it is you just have to do it. Which sounds so dumb because

No, but you know what I mean, we, we know it, but we don’t actually do it. We, it’s it Right. For most agency owners or new, you know, or leadership, this is not why they got into the agency business and they don’t love it. So it’s easy to be busy doing other things and not actually put it into play. Or worse, lots of agencies have a plan, you know, it’s a little like new year’s resolutions. Right. Everybody’s at the gym in January, but the gym’s back to being empty in February. And so a lot of agencies will put this elaborate plan together and they execute for a we moment or two and then they stop.

Yeah. Yeah, exactly. And I think, not to get too in the weeds here, but I think the other big piece of that from business development standpoint, or referrals, whatever it might be, is, and I you have some great content around this too, is looking at your current clients and who you’re going after. Right. And are clients not paying you enough or in a timely manner, are you going after folks who are just too small and it’s driving you a bad, the team fit? Yeah. Or a bad fit? Or is your team going crazy because of this? Right. And that’s a, could be a real issue. Right. So I think also it, it’s, it’s your time to, to take inventory of your current client base. And that can be painful. And maybe you can’t afford to let one of them go, and maybe you should, but then Absolutely.

When you look at these potential new clients, I know it could be tough right now to get they know too

Picky. Right,

Right, right. I, I get it. But I think it’s something that you’ve got to have as part of this business development plan. I think that’s maybe the second biggest thing. And, and I, you know, it’s something that you can do and that then you can work on to make sure that, okay, now you know what, this is where we need to be in the future with these clients. Yeah. So I think those are the two big pieces I

Would say. Yeah, I think you’re right. Well, hopefully, as people are planning for 24 and they are sort of dusting themselves off from the beating that 23 was for a lot of folks, yeah. They can put some of this into play. But I, I appreciate the perspective of it’s not all doom and gloom. There are opportunities, some agencies are crushing it this year, and so they’re doing, they are something different and we can do something different too.

Absolutely. Absolutely. Yeah. I think that, I think that’s definitely the takeaway for everyone as, as we head out here for sure. 2024, we’re gonna do it.

That’s right. I like it. So yeah, folks are not familiar with RSW, which I, I would guess everybody is, but you guys produce a ton of great content. You have videos, you have research reports like this. What’s what, what is the best way for them to dive in and start to absorb some of the wisdom that you guys share on a regular basis?

Yeah, absolutely. And thank you for that. Really, our site is rw us.com where you can then go to, you know, we do a lot of video. Our YouTube channel and Instagram and LinkedIn are probably our, our most active social social channels. But that site is the best way to go and then go from there and the reports are all there and our resources drop down. That’s where you’re gonna find all the, all the good content.

And folks will see you at the summit in May. So if they wanna Yes, that’s an exciting, they don’t a to to you before that. They will certainly see you in May, but hopefully they’ll reach out before that. But yeah, we’re excited about Denver too and we’re, we’re glad you guys are gonna be back with us.

This is, it’s a fourth year, correct?

Yeah.

And we’ve been a sponsor for all. So I would hardly recommend it is a great conference because it is small and mid-sized firms. Yeah. And you know, I think it’s one of those where you actually get actionable takeaways, not just, that was fine. You know, it was fun, but it’s, it, it is both those things. ’cause I think you guys are doing a really nice job. So we’re, we’re excited to be a sponsor again.

Yeah. We’re we, you know, in the research what we hear over and over is give me things to do to stop doing or do different. And so Totally. You know, that’s the charge for all of the speakers and sponsors is, look, our job is to be really pragmatic and practical. Yeah. And hands-on and action oriented. And so everybody shows up with that in mind. So, you know, and you guys have, have been a great supporter from the very beginning when it was just an idea, you know? And of course during Covid, right? Yeah.

Oh gosh. Yeah, yeah,

Yeah.

So we’re looking forward to it.

Us too. We’re glad to have you back. Alright, this has been great. Thanks for being back on the show and thanks for caring as much about agencies as you do and, and doing all of the, you get, your content is always so spot on and so helpful. And I know that on behalf of all the agencies that, that we talk to and serve, we’re, we’re grateful for you guys being as committed to the small and mid-sized agencies as you are.

Thank you, Drew. I really appreciate that. Yeah. And it, it’s, let’s, let’s stay positive.

Yep. We’ll get it done. Gonna do for sure. Yep. Awesome.

Thanks Drew.

You bet. Alright guys, this wraps up another episode. Lee gave you some, some truth, but also some opportunities to work around some of those truths. And remember as we talked about, this is not your first rodeo. This is not the first time you’ve seen a tough new business year and you have survived worse. And so I think just looking yourself in the mirror and saying, you know what? Done it before. We’ll do it again, but it’s time to get serious about it. And, and as you plan for 24, now is a perfect time to honestly put a plan in place and then probably cut half the plan out. ’cause it’s too robust. It’s not something you can sustain.

Just do a few things consistently and well in all of the areas that Lee talked about. You know, how are you gonna grow your existing business? What is your inbound strategy? What is your outbound strategy? And who’s gonna, who’s gonna lead that charge? And, and how do you continue to follow up and stay in contact with people who aren’t quite ready to make the purchase Yet? If you, if you can answer those questions and you can deliver against that consistently in a way that is helpful to the prospect, that shows them that you understand their business and that you’re gonna be a valuable partner, and it’s not just all about you, I promise you 24 is gonna be a good year for you. So take that to heart, pull your team together, make a plan, and get ready to start executing that plan if you’re not doing it already.

Okay, huge shout out and thanks to our friends at White. Label IQ, as you know, they’re the presenting sponsor of both the podcast and they’re coming back as the presenting sponsor of the summit for 24. So we are super grateful to them. They are born out of an a MI agency. So I’ve known the owners for 20 some years and really white Label was born out of their desire to figure out how to do design dev and PPC more cost effectively. And when they figured it out, they realized that they could help other agencies too. And so they’re doing that all across the board. So head over to White Label IQ dot com slash AAMI and check them out and reach out to them. And if you do talk to them, please tell them that we said thank you and that you appreciate the podcast and the summit and their support of it.

So that would make me very happy. Alright, I’ll be back next week with another guest. We’ll get thinking differently about the business. We’re in this together, I promise I’ll be back every week. I hope you come back as well and we’ll see you then. Thanks for listening.

That’s all for this episode of Amiss Build. a Better Agency Podcast. Be sure to visit agency management institute.com to learn more about our workshops, online courses, and other ways we serve small to midsize agencies. Don’t forget to subscribe today so you don’t miss an episode.