Media agencies: thriving beyond the crisis – sharpening your business development effectiveness to generate more business opportunities
In times of economic pressure, business development opportunities are going to be thinner on the ground, with many of these also likely to be of lower value and perhaps even lower quality. Therefore, getting business development right is critical to returning your business back to its growth journey as the world starts to return to some sort of normality.
A few years ago, we carried out research looking at what the most successful media and marketing businesses (i.e. those that were thriving with high growth and above average profit margins) were doing differently to those that were just surviving. Of the top ten common features we identified, no less than six were related to business development, reinforcing just how vital it is to get this right. Key themes in that research included:
- Ensuring you choose clients carefully and avoid over-dependence;
- Focusing on what you do best, without getting side-tracked;
- Focus on higher margin strategic work;
- Losing the long tail of smaller and often unprofitable clients;
- Ensuring you avoid getting complacent with existing clients;
- Taking time out to think about your clients’ business dynamics and issues, and ensuring that your value propositions address those issues.
At Moore Kingston Smith, we regularly help clients start their performance improvement journey by conducting a half-day structured workshop session in which we enable business leaders to identify how well their business performs relative to those factors that are known to be key to excellent performance. We also identify and prioritise key actions to bridge any gaps that are identified. Business development is usually the single biggest area in which businesses score relatively poorly. Indeed, key among our findings is that media businesses all too often have paid insufficient attention to:
- clarifying their target markets (which frequently prove to be too myopic, too broad or even just plain wrong, meaning that significant business development efforts can often be invested in chasing the wrong clients)
- robustly evaluating whether their value propositions really address target clients’ needs in a truly competitive manner (most organisations think they have a great value proposition, but our findings suggest that most propositions aren’t quite as good as people think they are)
- implementing a well thought out and clearly documented business development process that helps improve business development effectiveness, and that people in the business are aware of, understand and adhere to.
Understanding – and prioritising – your target markets
In these current circumstances, there is a strong chance that the dynamics of your usual target markets will have shifted significantly post-Coronavirus; demand from some sectors will have grown whilst others will have contracted. But not all of these changes will be permanent; trying to understand what the needs and behaviours of different market segments will be post-Coronavirus is key. Give yourself an edge over your competitors by proactively:
- investing in gathering insights into market dynamics and emerging trends;
- understanding true customer needs;
- segmenting your marketplace (as not all segments are equal, and ‘one-size-fits-all rarely works) and;
- creating value propositions that are sure to hit the mark in your prioritised target segments.
Getting your value proposition right
Perhaps the single greatest issue we encounter – as is usually illustrated when we speak with our clients’ clients (who frequently tell us why our clients’ propositions aren’t winning pitches, as well as how those propositions could be dramatically improved) – is how many value propositions often turn out to be weaker than their proponents think they are. Having a great value proposition is key to success; you can throw all the money you want at sales and marketing, but if your value proposition is neither compelling nor truly competitive, that investment is unlikely to deliver the results you want. However, too many SMEs rarely take the time to critically analyse the strength of their value proposition, often because they simply don’t have a simple framework for assessing and improving that proposition.
In order to maximise the number of business opportunities coming through and their chance of conversion, you must ensure that (i) your value proposition speaks to the market segments you are planning to target and (i) is clear, compelling and unique. Refining and better articulating your value proposition can have a big impact on your conversion rates, and improving conversion rates is key to maximising the effectiveness of your business development activities. We use a simple 5-step tool to help clients evaluate and improve their propositions, and in our experience this short exercise alone can have huge impacts on improving business development performance. As so often in life, sometimes it’s the simplest things that prove to deliver the greatest improvements!
Whilst you can of course make your own assessment of your value proposition and your competitive position within your target markets, it’s important to challenge your conclusions. As we alluded to earlier, conducting voice of the customer research (i.e. getting an independent third party to ask your clients what they really think of your proposition, your competitors’ propositions and how to improve your own) is a great way of doing this as it’s fast, inexpensive and produces far more open, frank and constructive feedback than internal follow-up calls. Conducting such research can tell you whether you really “came a close second”, how you could you be performing better in pitches, what clients really think of your value proposition or whether they even know what it is! One of our clients completely repositioned their offering off the back of a simple voice of the customer research exercise we carried out for them; the seemingly minor tweaks to their value proposition subsequently delivered substantial improvements in conversion rates and performance.
Looking after your valued clients
It’s widely known that retaining existing clients and getting repeat project work is much cheaper than pitching for brand new clients. However, so often we see clients that don’t have Account Management ‘client care’ programmes in place. Investing time and energy into identifying what your existing clients want from you is really important in improving client retention rates, but it’s just too easy to lose sight of that when you are trying to win new business.
Keeping a cool head: don’t just work harder – work smarter!
And finally, don’t get desperate! We often come across clients that will take any bit of business at any price just to keep the lights on – but this runs the risk of damaging your own brand and performance (and your ability to retain and attract the best clients and people) longer term. It’s near impossible to climb back from such a position and will likely lead to a low margin business. Stick to your long term strategy, review your target markets and value propositions, conduct research and ensure you spend time on the important rather than just the urgent stuff; we often advise clients that a key to success is to focus 80% of time on the 20% of actions that will deliver 80% of improvement – you just need to be sure you know what the 20% is, and how to manage that 20%. If you do these things, you will maximise your chances of thriving through this crisis.
Take a look at our Strategic Growth Services hub here to see how Moore Kingston Smith can help you to improve your business development performance.