Today’s article is contributed by Blair Enns, Principal at Win Without Pitching

We’ve gone from an era where creative firms never published their pricing to one where, while it’s not yet common, there’s a bit of a trend toward it among certain types of firms.

There are right and wrong motivations for disclosing your pricing on your website and right and wrong methods of doing so. Let’s explore them.

First, let’s examine the idea of why a creative firm would consider publishing its pricing on its website. Let’s start with what I hope is the obvious wrong motivation.

Wrong Motivation: Demonstrating Affordability

A firm that publishes low prices is essentially competing on price and sending negative messages to the marketplace about quality, confidence and sophistication. Selling on low price can be a viable strategy for fully-productized businesses that have a production advantage or an economy of scale that lets them sell more cheaply than their competition. These businesses don’t mind dragging prices down and squeezing out less-efficient competitors as a means of gaining marketshare.

You’re not in such a business and therefore not employing such tactics. (If you are then you’re destined to always run your business from your parents’ basement.)

Right Motivation: Demonstrating Exclusivity

The opposite approach of publishing higher-than-market prices as a form of positioning is a more valid one. Pricing is positioning. Let’s be clear, however: where Logos-R-Us might price logos at $499, a firm trying to position itself as upscale isn’t going to price logos at $50,000. They’re going to speak in more general terms about the size of budgets they work with. More on that in a minute.

Right Motivation: Advance Client Qualification

Some firms do a great job of inbound lead generation but end up attracting a high volume of price buyers or other budget-challenged prospects. In such firms it can make sense to publish pricing guidance as a means of keeping the gnats at bay. Putting pricing guidance on your contact form is a good way to help vet such clients and ensure that anyone who does reach out has at least some idea of how much it will cost to work with you.

Now let’s look at the right and wrong methods of publicly disclosing your pricing.

Right Method: Minimums

I’m a fan of using a minimum level of engagement (MLOE) in the sales conversation. It can make sense to publish such minimums.

“Our minimum level of engagement is $100,000 in fees over the course of 12 months.”

Or the more subtle, “Projects typically start at $25,000.”

Right Method: Ranges or Examples

I think ranges and examples are the best ways of publishing pricing guidance, saving the more rigid MLOE for the sales conversation where you can imbue some flexibility and use it as a negotiating lever. Ranges and examples provide guidance but still leave the door open to opportunities just below the minimum level.

“A typical project ranges from $100k – $300k and our clients typically spend between $500k and $2m over the course of a year.”

Wrong Method: Package or Tiered Pricing

Increasingly, I’m seeing creative firms, and digital firms in particular, publishing tiers of services with pricing attached. This is a trend borrowed from Software as a Service (SaaS) companies, many of whom are sophisticated pricers. On Salesforce.com’s pricing page for example, I count seven obvious pricing principles, nudges or other tactics designed to leverage the mental shortcuts buyers use, sometimes irrationally, in their decision making.

Many of these pricing principles can be applied in a creative business, including the use of options and bundles.

There are important differences between SaaS companies and creative firms however and therefore implications on pricing strategies. Most SaaS companies are selling products in large scale which means they’re effectively pricing the product and not the client. (More correctly, they’re using sophisticated segmentation strategies on large markets to group clients and price the segments, but compared to your business where you should be pricing each individual client, they are effectively pricing the product.)

Price the Client

In your firm you want to price the client and not the service. That means taking full advantage of price discrimination (a good thing, in spite of its name) and the subjectivity of value which I’ll sum up thusly: a service you perform for one client can be significantly more meaningful and valuable to another client, therefore you should charge less to the first client and more to the second.

When you publish package pricing you remove your ability to practice price discrimination and you force yourself to make significant judgments on the value you propose to create for your clients before you even have a conversation with them.

It is a good idea to think and price in tiers, bundles and options – just make sure that each is constructed for the client, in the sale, and not an off-the-shelf package with a predetermined price.

In summary, it can make sense to publish some pricing guidance on your website to help you with positioning and to prequalify prospects, just avoid specific prices for specific services, and if you do employ the pricing tactics of tiers, bundles and options (as you should), don’t make the mistake of assembling, pricing or publishing them before any conversation with the client.

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Brad Jakeman Suggests Shops Have Not Kept Pace With Change

We didn’t grab all the content of today’s AdAge article (10/16/2015), but we did include enough to share the comments. As I’ve remarked over the years and as Brad says – stop already! Ad agency models are breaking. Pre-roll ads are useless. Measurement models are outdated. The ad industry lacks diversity. And the phrase digital marketing should be dumped.

Those statements were among the declarations made Wednesday by PepsiCo exec Brad Jakeman in a fiery, truth-telling presentation at the Association of National Advertising’s annual “Masters of Marketing” conference in Orlando, Fla. Mr. Jakeman — who is president of PepsiCo’s global beverage group — went so far as to suggest that even the phrase “advertising” should go by the wayside. He did so before 2,700 marketing and agency professionals at an event put on by an association that has the word advertising in its name. “Can we stop using the term advertising, which is based on this model of polluting [content],” he said. Mr. Jakeman also ripped the industry’s lack of diversity. “I am sick and tired as a client of sitting in agency meetings with a whole bunch of white straight males talking to me about how we are going to sell our brands that are bought 85% by women,” he said. “Innovation and disruption does not come from homogeneous groups of people.”

Harley-Davidson Chief Marketing Officer Mark-Hans Richer — who delivered a late morning presentation — responded to a question about agencies by pointing out that the motorcycle marketer works with a lot of shops and takes a “boutique” approach. “We have not had a lead agency in about five years,” he said. “Clients must take more responsibility for creativity. It’s not the kind of thing that you should offshore.”

Mr. Jakeman called digital marketing the “most ridiculous term I’ve ever heard.” He added: “There is no such thing as digital marketing. There is marketing — most of which happens to be digital.” He urged marketers to create digital cultures, not digital departments. “We ‘ghettoize’ digital as though it’s the life raft tethered to the big ocean liner. And we have to move on from that.”

So he turned to the example set by Caitlyn Jenner, praising the way she “managed her transition … figuratively and literally as a brand.” The process — from the Diane Sawyer interview to the Vanity Fair cover — was thought-provoking, authentic and profound, he said. “This was something that the world was talking about, and the world has continued to talk about.” Then he posed a question to his fellow marketers: “Have we done anything with our brands that is in any way as remarkable as the way Caitlin Jenner, and that phenomenon, has been managed?”

The proposition – You’re one of our special registrants looking for new business. Regardless of type, you built a profile here at AgencyFinder.com so you can be found and invited to speak and ultimately pitch a new client. Now the good news – your firm surfaced as a candidate in this client’s search. All we need now is to send your invitation so you can schedule your initial client interview.

But there’s a problem. Increasingly our invitations haven’t been getting where they’re meant to go. In your profile you’ve given us your office landline phone, your fax and your e-mail. In our ACT database, we may also have your cell number. Here’s what we’ve been doing for years and what’s been happening recently.

1. We send you and your alternate NB contact an e-mail alert identifying the client, budget and client URL. We mention the full invitation will follow as fax.
a. e-mail gets to you both; you do/don’t read it
b. e-mail goes to your Spam folder and is not read. Dead end.

2. We send your fax just to you.
a. Fax gets to you and you read it
b. Fax gets there but someone picks it up and throws it away (thinking it’s a 48-Pt type island travel offer)
c. You no longer have a fax – obsolete technology you explain (there’s e-fax, etc.) – ask that we scan and send as e-mail attachment
d. Scanning 6 pages – extra steps for us – that too goes to your spam folder

3. We phone to follow up
a. We have to leave a voicemail (sometimes mailbox is full)
b. Someone offers to take a message; don’t know your schedule
c. You say or they say – never received the fax
d. New fax number and sent again

Consequence? You’re either a “no-show” or significantly late. And that’s why we ask – HOW DO YOU WANT YOUR INVITATION?

We’re open to suggestions and figure you’re the one with the answer!

Let us hear from you! Write or call 804-346-1812.

Buck up Fellas (those doing anything for your agency on new business), it’s about time you heard the truth. If it’s your job to connect with new prospects, then pick up the phone when you’re told and stop hiding behind your keyboard! Stop staring at your call sheet and dial! Sales (the “S” word), as in the pleasant, professional art and science of commiserating with a prospect so as to share your “brand ambassador” story is NOT of itself a natural talent but a learned and practiced “skillset.” For starters, if you know a successful “New Business Pro”, seek permission to listen in, to witness, to bask in the majesty of one from whose lips the perfect, persuasive and yes “beautiful” sequence of words flow gently to the prospect. Not some slathering set of syllables from the lips of a “hot shoe” carney that offend upon impact, but the sweet, gentle flakes of new business persuasion.

Yes boys and girls, sales is an accomplished skill set worthy of respect and adoration.

Now that’s not to say some people don’t have an “inclination” towards sales. But even those naturals benefit from formal training. I urge and encourage anyone who wants to succeed at new business development to get formal generic “sales” training. My first exposure was with Dale Carnegie. (Not the man but the course) That or many others are available. If you’re the firm’s decision-maker, sign yourself up. If you have an employee in that new business role, enroll them. If you are that employee, ask your supervisor to get you enrolled. And don’t short-sheet their training. After that there are more than a few specific “agency” new business trainers. My favorite is Sanders Consulting. But in any of these, get the basic sales training first. And for any of you already in those roles, one thing you can do for immediate improvement is “role play.” You and an experienced colleague get on two telephones and start role-playing. Try various scenarios and work them!

My advocacy here is simply that “sales” ladies and gentlemen is a taught and learned skill set. We’ve also posted some relevant new business tips. So get cracking!

Let me know how it goes …

Let’s be real. Most salespeople are super annoying. They view their prospects as numbers in their sales funnel, not as people. They believe earning your business is a chess match and a signed contract means they “won the game.”

However, B2B buyers and B2C consumers generally do not know how to purchase anything that falls outside their area of expertise. Think about it. Do you really know how to buy a TV? Do you know what precise technical questions to ask? You’d probably like some help, right?

But ironically, when the salesperson at the electronic store asks if she can help, what do you typically respond with? “No, I am just browsing.”

The cat and mouse game buyers and salespeople play has created an environment of leverage and one upmanship versus understanding. And this hostile relationship often stems from the questions salespeople ask their prospects. Below are 12 common questions sales professionals ask prospects and why they should stop — or at least, rephrase.

1) What is your budget? / What would you like to spend?

Buyers often rationalize lying to salespeople about their budget because they feel it is the necessary first step in a negotiation. And why do you need to know about budget up front anyway? If the buyer has purchased what you are selling in the past, they will have money to spend. If they have not — how will they know what price is right?

Instead of demanding a budget right off the bat, strive to understand the prospect’s process for buying and their spend tolerance. Simply asking about their buying process for your type of product or service will get you a lot better information than asking specifically about budget.

2) Is price or quality more important?

Shame on you for asking this question. If you beat the competition solely on price, just come out and say it. However if you are not the low cost provider, you need to build value. Your prospects will naturally associate a given amount of value with “what the product is supposed to cost” so a good salesperson will try to understand that perspective and discuss price from there.

3) Are you the decision maker?

This is a bad question because it’s unclear. Are you asking if they’re the decision maker for which vendors move on to the next step in the buying process? Or are you asking if they can they sign off on the proposal? This puts the prospect in an ego predicament. No one wants to feel as if they are just the informer.

Instead, ask the question “Who is involved in this process?” Even the CEO gets input from others (or at least he or she should). This should reveal all relevant influencers, stakeholders, and the ultimate decision maker.

Salespeople need to identify the decision makers so they can work with these stakeholders throughout the buying process. Too often we leave it to others to sell our products and services to executives because we failed to appropriately engage them.

4) What is your pain?

You won’t get the answer simply by asking. Most salespeople stop probing for pain once they hear an indicator such as, “If this doesn’t go well, I will get fired.” However, pain is rooted in emotion. In this example, the pain isn’t the potential of getting fired — it’s the emotion associated with getting fired.

Everything we buy is bought emotionally, so unless you know the pain, how can you truly help? Seek to understand the prospect’s underlying emotional need for change.

5) How good are your products and services?

This is a legitimate sales question to ask if your product or service promises to improve the prospect’s business results. However, if you pose it in this way, prepare yourself for a biased answer.

How can you get an honest response? Ask questions around how the business is doing from a third-party perspective, or versus the competition. For instance:

When you lose, why do you lose?
What do your customers say about your products and services?
What percentage of your business is referrals?

6) How strategic are you?

Ego will not allow your prospect to say “not at all” (even if that’s the truth). On the other hand, if they do show vulnerability, they will likely blame the company or others for it (which shows they are not truly strategic).

Instead of asking this question at all, simply listen to your prospects’ answers to other queries. I guarantee you will discover if they are strategic or not.

7) Would you like a proposal or quote?

When you ask this question, you will likely get blown off one of two ways. You will be either be told “I am happy with my current vendor” or “I don’t want to waste your time.”

Another possibility is that the prospect will gladly take your proposal … and use it to price check their current vendor. Your proposal then functions as intel for your competition. Finally, the prospect could request your proposal simply to get you out of their hair.

A proposal should simply be a summary of expectations both parties have already agreed upon. It should only be sent once you have agreed on scope, pricing, timing, etc., and serves as documentation for the work being completed. It does not sell anything in and of itself.

8) Can I show you our capabilities? / Would you like a presentation?

Show and tell is for your nine-year-old. If you are presenting, you are not selling. You are bragging. Don’t brag.

9) Is this a good time to chat?

Do you think your prospects sit in their offices hoping a salesperson calls? There is never time, but people can make time if they want to. This question gives your prospect an easy out. A better way to ask this question is, “Did I catch you at a bad time?”

10) What level of service are you willing to pay for?

This question implies that your relationship is only about money, and that’s just not true. Sales is about balancing what the prospect needs with what they want. Your questions should inform you about the prospect’s business so you can discuss appropriate solutions.

Build value, not budgets. If your business offers multiple service levels, ask the relevant questions in order to make a recommendation.

11) What can I do? / What will it take to earn your business?

This sets you up for failure because you are now just an order taker. The prospect tells you in this moment what it will take to get a signed contract … and they will continue to tell you what you have to do for the rest of the relationship. This isn’t exactly the partnership you touted when trying to earn the business. This question also implies that you will take on anyone and are willing to be insincere to close a deal.

Get to know the prospect’s business, their pains, and how you can help. If it makes sense to work together, it will happen. If not, move on.

12) Who was the best salesperson who ever called on you?

Who cares? Are you going to be inauthentic and act like someone else to try to earn the business? Would you ask your spouse who was the best person they ever dated? Forgo this question in lieu of more valuable and revealing queries.

A good sales professional has virtually no cap on earning potential, but it takes more than practice to attain mastery. Top salespeople continuously develop and refine sales skills through learning — with the help of a coach, trainer, manager, or on their own. Don’t you think asking great questions is one of those critical skills?

Contribution by Jeremy King. Jeremy is part of the leadership team at Element Three, an Indianapolis-based agency that was one of the first HubSpot Platinum Partners.

Contributed by Chuck Meyst, Chairman & CEO AgencyFinder.com

To hear some agency principals talk, they think so.

And frankly we shouldn’t blame them. We’re talking about a component of the process known as the agency review. The idea is to invite and examine a sufficient number of candidate agencies and winnow the group down to 2-3 finalists. Those finalists will make “final presentations” and it’s there that spec creative rears its ugly head! The requirement calling for “spec creative” is an element of the infamous RFP and is like doubling down on evil. Let’s start with that RFP or Request for Proposal. As first client contact with randomly selected agencies, the invitation often begins like a warrant. Often the RFP “document” is the result of the client searching the Internet and grabbing a “template.” Without giving any real consideration to what they need in the way of an agency, and how they will  find agencies that fit those criteria, they begin their convoluted search. Searching using Google at best is worst. Agency websites range from single-page scroll-down templates themselves, to “kitchy” and “we’re different and we’re unique arguments and displays”. Good luck finding an agency website that reveals their employee count and even more bizarre, won’t provide their physical location or contact phone. Yet we should think that any agency bothering to have a website is looking for new clients, right?

Not all RFP’s are pervasive, but most tend to ask for more than necessary to begin exploring the possibility of a working relationship. Many include Gestapo admonitions like “If you communicate with any employee of our company, you will be removed from the review!” Or “Send 4 copies only. More than 4 will call for disqualification.” A silly and egregious way to begin what is meant to become a partnership. And be reminded, the client has to sell themselves to each agency as much as the reverse is true!

Each agency tells their story. In the best reviews, this can be done while the client is visiting the semi-finalists. That’s where an agency tour, the presentation of case histories, and the examination of past work takes place. Some clients think and are inclined to identify their winner after seeing agency work. Each agency understandably presents their best work but the devil is in the details. Does the agency admit that their client suggested the layout, headline, shot angle and copy? And does the client even think to inquire? Past work is only one element of the consideration set.

Now to final presentations. As the search consultant we are, we believe prospects who ask for spec work are looking to establish two things. 1. Does the agency understand their business (has your team been listening?) 2. Therefore can you produce something that demonstrates that? I agree with everyone that says it’s expensive; I agree it’s almost impossible to debrief a prospect sufficiently to respond with any degree of precision.

So what to do? We suggest to all clients they should identify a business they know fairly well (but completely different than theirs) and ask for a spec presentation based on that business. There’s more to it than that, but you get the point? Do the same for all players. In this way, the client will be able to witness the agency’s approach and process but both parties are one-step removed. And to the delight of any agency, the creative can’t be used by the client.

The new standard for “spec creative!”

by Blair Enns

As someone who’s received so much joy from others’ conspiracy theories, I feel like I deserve the chance to float my own, at least once. So here it is. Read on, but only if you’re prepared to have your world shattered.

On January 17th, 1961, outgoing US president Dwight D. Eisenhower delivered his farewell address to the nation in which he warned Americans of the dangers of their country’s burgeoning military-industrial complex – the enmeshed and at times indistinguishable interests of government, politics and corporate greed that were creating the conditions in the country where war was seen by too many to be beneficial, desirable and therefore inevitable.

While Eisenhower didn’t invent the term “military-industrial complex​,”​​ ​he popularized it, and 55 years later we all understand its essence​:​ that some things – ideas, interests or movements – can get so big they seem to steamroller to inevitability, even when it’s not in the interests of the greater good. They take on a life of their own and can never be dismantled because forces too strong and too many are made stronger by the entity and will resist all attempts to unplug it or even slim it down.

That’s not my conspiracy. I think we can all agree that the military-industrial complex is a thing.

No, my conspiracy is that in the creative professions there exists the equivalent: an industrial pitch complex (working title only, tweet me your suggestions) in which numerous dark forces within the creative professions are conspiring to keep the pitch in place for their own nefarious, self-serving reasons. They will stop at nothing to keep the pitch alive. Nothing.

Come with me now as I pull the thread that unravels the whole thing…

Who’s Involved in Our Conspiracy?
Well, everyone of course, but I’m pretty sure conspiracy theory affords the same protection against libel as does parody or true statement. (I’ll admit I’m too lazy to confirm that with a simple Google search.) So let’s name names, shall we?

Clients
There are some great clients out there and then there are those like the ones featured on AMC’s show, The Pitch.

My over-riding thought when watching The Pitch was not what you might think – it was about the clients, not the agencies. I kept thinking, “If I was the CEO of this client company I would fire that CMO.”

Too many clients are caught up in the pageantry of the pitch, luxuriating in the control they wield and sycophantic frenzy they create. For them the pitch must persist. It is their greatest source of power and puppetry.

Procurement People
They’re in on it, but they’re pawns really. They can’t help it. Buying creative services isn’t what they signed up for so they find themselves applying widget purchasing processes to the acquisition of ideas and advice. They are orderly-accountant-types, happy to be at the freaky people table where they propose to bring some rigour and order, if only they knew how.

Over the last few years some procurement people have become pretty good at it, doing less damage, but the best line on the topic goes to pricing guru Reed Holden who says, “Eighty percent of procurement professionals give the other twenty percent a bad name.”

In truth, if procurement people were at the centre of our conspiracy we would be dealing with something far worse than the pitch. Let’s be grateful they’re just willing bit players.

Search Consultants
You would be forgiven for thinking, “Wait – weren’t search consultants replaced by Google years ago?” They weren’t, for the reason that a search consultant’s role has never been to search, but to vet.

You can make a whole lot more money vetting firms for busy clients if you can make the process bigger, longer and more expensive than it needs to be, all under the guise of “searching.”

Search consultants are not only in on the conspiracy, they’re the smoking man​,​ the men in black, the illuminati. They meet in high-security estates in the Hamptons on nights of the full moon where they perform their secret rituals involving bound clients and agency principals clothed only in hoods, blindly groping each other for the pleasure of their master lords who prod them on chanting Lorem Ipsum while sipping Hemingway Daiquiris.

Seriously.

The pitch will never die as long as search consultants are among us. (note: excluding Chuck Meyst and his AgencyFinder.com)

Your Competitors
Do you ever go to the local ad club and hear someone say, maybe a little too loudly, “Everybody knows you can’t win without pitching so don’t even try”?​ That’s what they want you to believe. The reality is that most of your competitors are Alien Subterranean Lizard People who are trying to control you through their thought rays. You know what I’m talking about.

Conferences
New business conferences have become the forum where those complicit in the industrial​ ​pitch complex meet in plain sight. Agencies come in hordes, paying to hear clients tell them how to pitch them better, hoping to rub up against them in the dark hallways in the breathy, stolen moments between shows. Search consultants too get on stage and move their lips. And the police just let this happen.

Lizard People. All of them.

Of Course The Media’s In On It!
How interesting would Ad Age be if there were no pitching in this business? About half.

There was a time in my own agency career where my entire lead generation plan consisted of reading the Accounts Under Review section of Canada’sMarketing Magazine and then scurrying like a lemming to throw my firm’s hat into the ring. (That’s why we still have search consultants – to keep the hordes at bay. It really isn’t their fault. Turns out its mine and the media’s. Mostly the media’s.)

Then there is television’s The Pitch and Mad Men. One is a fictionalized drama of the advertising business and the other is a comedy, both designed to perpetuate the pitch.

Trade Associations
I’m looking at you, 4As.

You know. I know. You know I know.

The Evil Lurking Within
Okay, we agree that when it comes to people in the profession outside of your walls, they’re ALL in on it. You and I both know however that, just like 9/11, there may be outside co-conspirators but this is really an inside job.Your people are in on it.

How do we know? In a word: motive.

If the pitch weren’t here how would they account for all that non-billable time on their timesheet?

How would they justify those $400 lunches at Smith & Wollensky? (Would Smith & Wollensky even exist?)

Without the pitch, selling would really only require one or two people, but look around you – how many people on your team have attached themselves to new business, racking up untold hours writing proposals, brainstorming free ideas, finding reasons why they need to be in the room? When did this happen? How did it all get so big and expensive?

The industrial pitch complex has become a giant slithering mass of entangled self-interests the size of a small planet, with a gravity all its own, sucking into it people, money and time. It grows and throbs, adding layers, pulling in even the honest and the pure. Meanwhile, deep down in its very core, calling all the shots, unbeknownst to even those under their power, lurk…

The Lizard People.

You’re welcome. For speaking The Truth. Somebody has to.

What you do now is up to you.

By Brian Bennett, president

Inbound marketing is a tremendous advancement in our trade. It is a brilliant culmination of new, integrated technologies and methodologies. The analytical capabilities and accountability it provides are a great leap forward. Soon, inbound marketing will be a cornerstone in our industry.

Unfortunately, many of the pioneers of this breakthrough have gotten too wrapped up in their own efforts to market and differentiate this new discipline and are actually hindering its development with their myopic claims. To them, I say, hear this:

You don’t need to bash outbound marketing to promote the advantages of inbound. 

The development of inbound marketing will not render outbound obsolete or replace it entirely.

Practitioners of outbound marketing are not, by definition, ignorant.

It would be irresponsible to recommend inbound marketing as the appropriate strategy for all marketing objectives. Inbound marketing must be integrated into marketing plans; it should not dominate them. Many outbound techniques such as pay-per-click, event marketing, public relations and advertising are absolutely essential to the success and development of inbound efforts, and to preach to the contrary would be disingenuous on the part of any truly enlightened and capable marketer.

To say that inbound marketing makes outbound obsolete is akin to saying:

Velcro shoes will replace laced shoes
Four-wheel-drive vehicles will replace two-wheel-drive vehicles
Aspartame will replace sugar
Smartphones will replace laptops
Traditional agencies are dead and will be replaced by digital agencies

Remember that last one? Go back about six years and read the headlines in marketing trade journals and you’ll find that this was the buzz. Some digital shops were flush with success and quite certain that they would dominate the industry. Instead, the established marketing community adopted and absorbed digital disciplines when they became established and credible. Those true marketers then integrated that discipline into greater holistic solutions.

Today, inbound marketing is dominated by those who have mastery of the software and core activities that make up the craft. They tend to focus primarily on tactics, but there are many sophisticated techniques that must be applied outside of these core tactics. My advice and request for my soul mates – those early adopters of inbound marketing – is not to degrade the discipline by pitching it as a replacement to outbound but rather understanding that it should be integrated with outbound marketing efforts as part of a company’s holistic marketing plan. Inbound marketing is worthy of great respect on its own merit – don’t try so hard!

“STIR Advertising and Integrated Messaging in Milwaukee, Wisconsin, blends the disciplines of a creative advertising agency with a fully functional digital marketing agency. Find out more about STIR atwww.stirstuff.com.

Our guest contributor today is Tim Williams. Tim leads Ignition Consulting Group, a consultancy devoted to helping agencies and other professional services firms create and capture more value.

There’s new money to be made in the agency business, but it lies in the white space of our business model – the unmet needs of today’s marketers. Unfortunately, most firms are too busy selling yesterday’s services to uncover and develop the solutions marketers will need tomorrow.

It’s as if we believe the solution to more profits is more work. More work can mean more revenue, but it doesn’t necessarily mean more profit. Not every dollar is a good dollar. That’s because most agency revenue streams are made up of work that could be categorized as “widely available services.” As a result, most agencies are swimming in overserved markets, offering common services, but hoping to make uncommon profits.

When markets are saturated with providers who all appear to do roughly the same thing (which is how many clients perceive the advertising agency industry) economists call this a state of “perfect competition.” While you may think of competitive markets as good old American capitalism, it’s actually not a very desirable place to be.

Venture capitalist and Paypal co-founder Peter Thiel observes that firms selling homogeneous services in competitive markets have no market power, meaning they must sell at whatever price the market determines. And whereas a competitive firm must sell at the market price, a monopoly owns its market, so it can set its own prices. By monopoly, Thiel doesn’t mean the big bullies of industry, but rather the firms that have such unique products and services that they literally have no direct competition.

Better to be blue than red

The question Thiel advises businesses to ask is “What valuable company is nobody building?” That’s a pretty profound question, because the answer points us in the direction of the uncharted waters of the “blue ocean.” One thing that’s increasingly clear is that there is very little profit to be derived from the “red ocean” (red from the blood of competitors fighting for every shred of business).
Agencies need new revenue streams, not just more of the old ones. To start heading in this direction, we should be asking questions like:

1. What new services or solutions could we offer to help clients successfully navigate through the continually changing multichannel universe?

2. What are the persistent frustrations (beyond cost) that marketers have with agencies, and what new approaches could we develop that would solve them?

3. In addition to strategic innovation, could our firm also be characterized by operational innovation?

4. What keeps our clients up at night, and how could we develop products or services that would help them sleep better?

5. Which service areas provoke the least amount of price sensitivity among our clients? How can we develop and provide more of these types of offerings

6. What are the capabilities that most client organizations would never attempt to develop in-house?

The tyranny of “best practices”

What holds us back? Certainly the pressures of day-to-day client-related tasks, which all masquerade as “urgent.” But at a deeper level it’s the ingrained belief that the job of management is to study and adopt “best practices,” as if mimicking another firm’s current approach is the pathway to future success. As Jules Goddard & Tony Eccles write in their insightful book Uncommon Sense, Common Nonsense, “Best practices are simply plagiarism on an industrial scale.” While continual improvement is important, it’s not nearly important as continual innovation.

That’s because tomorrow’s profit pools will not be derived from today’s services. So instead of sliding further down the client’s value chain, muster the courage to go where no agency has gone before. There is tremendous value in first-mover advantage, and the first agencies to move into new territory will not only have a competitive advantage; the best of them will be able to do what the planet’s very best companies (like Apple and Google) have done; create “monopolies” in the best sense of the word.

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Every agency wants an easy way to find new clients. And apparently clients think agencies are just waiting for them to post a juicy RFP (as in Request for Proposal). If you don’t share that opinion, try Googling “Advertising RFP’s”. You’ll find hundreds if not thousands of RFP’s of every kind for every industry and for every budget. However, look closely and in many cases, you’ll find the budget mysteriously missing. That’s because on close inspection, there is no committed budget, there is no structured outline for the assignment, and the client (often lead by someone in the Procurement department) expects your agency to conduct both the research and analysis to identify the necessary budget.  In the end (if you ever get there), you’ll be lucky to discover the client has or is willing to spend what you’ve identified. And if you’re willing to wade your way through their obligatory legalese and agree to their terms (they own everything, you own nothing and you’ll get paid when), then maybe the RFP route is for you.

Now to the real point of all this … There is no precision or particular logic to the RFP postings themselves or the agency audience that will see them. Many of the posted RFP’s are accompanied by historically littered “rules & regulations” copied from those that preceded them, and they reek of mandated conformity. In particular, they include the admonition that any attempt to contact anyone at the company (imagine that – talk with someone at the client) will result in removal from consideration. In general and given any choice, agencies avoid these RFP’s like the plague! So what happens? Most who posted the RFP’s experience a modest or otherwise minimal response, and the picken’s are slim. They find themselves selecting not the best from a group of great candidates, but the best from a lot in which there may be no “best.” In some cases, the incumbent retains the account because no other agency was prepared or willing to penetrate the shield. And everyone loses.

You might think a Master RFP site is the answer. I say politely you are  crazy – the RFP is NOT THE ROUTE TO GO! I started this piece as an “expose” on the ridiculous state of the RFP situation without anticipating where I’d end up. I honestly had no self-interest in mind but I’m now heading to the conclusion that the best solution would be a SUPER AGENCYFINDER – an agency search and matchmaking service that represents all the marketing firms in the US and then that fact is made known to every client that might ever need an agency. This process turns the RFP around and enables clients by giving them the power and precision to find and evaluate firms that fit their needs – for experience, services, location, size and more.  That’s a gigantic undertaking beyond our current capacity (staff, facilities, capital) but it’s an idea that demands to be built. We’ll need some partners with genius, brilliance and deep pockets.  If you’d like to be involved, let me hear from you. Even your thoughts are welcome.

P.S. February 2019 – The topic is still alive and of interest. Any contributors or takers?

Write me: or call 804-346-1812