How To Grow Your Business: Four Steps For Agencies
How to grow your business is one of the most important topics on the minds of owners and leaders of PR, communications and related agencies, as well it should be. Earlier this year I shared a post at CommPRO.biz on four steps agencies can take to achieve their new business goals. I believe you’ll find it valuable as you head into business planning season and start to map out how to grow your business in 2014.
Please share what you’re done to grow your agency business in the Comment section.
Getting Down To (More New) Business
Editor’s Note: This is the second in a series of PR agency business-building tactics and trends from industry expert, Ken Jacobs. Part one is “Agency Management: Kicking 2013 Into Action”
In my previous post, I discussed four steps agency owners and leaders can take to kick 2013 into action. One of them was to have a written plan to generate more business. I’ll expand on that today, because I believe it’s one of these leaders’ most important responsibilities.
I recommend the following four preliminary steps to reach your agency’s 2013 fee income growth goals:
1) Choose The Number. The act of writing your agency’s business development plan increases the chance it will reach its desired growth goal. So name the number! How much do you want to increase fee income in 2013 vs. 2012? Ten percent? Fifteen percent? Twenty or more? State it as a dollar amount.
Start with a reality check. Review the data from various sources, such as The Holmes Report, or The Council of PR Firms, on how much agencies the same size, practice area, and geographic region as yours grew their incomes last year, to determine a realistic goal for your firm. Consider joining an organization like PRSA’s Counselors Academy, where fellow members share this kind of information.
2) Determine How Much Income You’ll Generate From Current Clients. Growing income from existing clients is always the best route. You’re not competing in a cattle call with a large group of agencies (other than the other firms your client retains,) you know this client and their business inside and out, and, I trust, you already have strong relationships across a number of levels. There are many other reasons to pursue new business from your existing clients.
The key is dedicating the time to gather the internal and external brainpower to review all the other business and communications issues that the client is facing and may experience, and for which your organization can provide solutions, separate from the activity it’s already executing on the client’s behalf.
No time for such an exercise? Here are two motivations: 1) Your competition is probably doing this; and 2) Your agency would probably do this for a new prospect at the drop of a hat, and for a pitch where the odds are stacked much more against you. Why wouldn’t you invest agency resources for the more likely win?!
3) How Much Additional Income Must You Generate From New Clients? While it would be ideal if one could reach one’s agency growth goals from existing clients, this simply isn’t realistic. Even if you can grow some clients’ budgets by 10, 15 or 20%, this might be offset by other accounts staying flat, slightly declining, or worse, a client replacing your agency with another firm. That’s why having a robust annual plan to acquire new clients is absolutely critical for your agency to survive and thrive.
So take your fee income growth goal and subtract what you proposed as your income growth figure from existing clients. The remainder is what you must generate from new clients. Scary? It should be. But if it’s absolutely terrifying, and your overall income growth goal is realistic, consider if the number you projected for fee growth from current clients should be more ambitious.
4) Let’s Start At The Very Beginning. While it might be counter-intuitive, when determining the ideal prospects for your agency, it’s time to get picky. Remember, it’s not about all the companies you can target; it’s about coming up with a manageable target list. If you don’t, you and new business team will feel overwhelmed. And that could lead to inaction.
Equally important, you want to identify the target categories and clients that will help you achieve your agency vision now, and three and five years in the future. Ask yourself three crucial questions: 1) Which categories are growing?; 2) Which are most likely to need a firm like yours?; 3) Which will value what your agency truly does better than your competition? These are the categories that have the prospects most likely to choose your firm, and pay top dollar for your offerings.
Obviously, the first step is to determine what your firm truly does better than your competitors. But that’s for another post.