9/2/03 adv 4312 1

Business Development in Agencies

9/2/03 adv 4312 2

Organization for BD

• Depends on size• Larger agencies may have separate

departments• Headed by a VP / Director• Department consists of servicing and

planning / research staff.• Creative / media support requested on

need basis • BD reports to Agency President / CEO

9/2/03 adv 4312 3

Functions

• Create a new business plan• Spot new business opportunities• Present the agency in the most favorable

light• Make speculative pitches• Discuss & negotiate contracts and rate

cards• Finalize contracts & turn over account to

the servicing team

9/2/03 adv 4312 4

Create a new business plan

• Set targets– Quantity of new business– Type of new business– Business that is off limits (conflict of interest,

non-competitive issues)– Culture matching– Minimum acceptable account size– Costs of BD

9/2/03 adv 4312 5

Spot NB opportunities

• Keep your nose to the ground– New products, companies – Accounts likely to move

• Network with businesses and even competition• Create “brand champions” in industry (third party

recommendations)• Research – company / brand performance, sales

& profits, advertising problems

9/2/03 adv 4312 6

Spot NB opportunities (cont.)

• New ideas – apply new ideas to brands you want to pitch for

• Initial discussions with potential client always carried out discreetly.

• Note: BD responsible only for new accounts. More business from existing accounts – account service team.

9/2/03 adv 4312 7

Present agency credentials

• What sets you apart from other agencies– Reach– One-stop-shop vs. deeply specialized– Business focus (b2b, b2c, retail, infotech, hitech, etc.)– Values and Beliefs– Track record– Quality of staff

• Hard data (e.g. cap. billings, size, staff, past campaigns and results)

• Soft data (core competencies, values and culture)

9/2/03 adv 4312 8

Present agency credentials

• What strengths will you bring to the table• Policy on bringing creative & media talent

to presentations• Customize presentations (canned

presentations are less effective)• Initial presentations do not address client’s

advertising problem• Based on agency credentials, client may

give a “go ahead”

9/2/03 adv 4312 9

Speculative pitches

• Policy about spec. pitches (make/don’t make, free/at cost, etc.)

• New ideas for old brands– Often done without a complete client brief

• Pitches for new products always preceded by a client brief

• Comprehensiveness of the pitch (include only strategy or plus creative or plus media, etc.)

• Always identify and present the account team

9/2/03 adv 4312 10

Speculative pitches

• Only agency vs. compete with several• If past agency-client relationships have

been a problem, client may open the account for review

• If you compete with several, clients try to assure a level playing field. Same client brief shared with all competing agencies

• Your effort directly proportional to how much you want the client.

9/2/03 adv 4312 11

Contracts and rate cards

• Used to be standard – not any more

• Open to negotiations

• Important clauses– Length of contract and termination clauses– Ownership of advertising materials like raw

stock, four color positives, photographs, etc.– Agency compensation– Creative fees, consulting fees, material costs

9/2/03 adv 4312 12

Contract & Rate Cards (cont.)

• Important clauses (cont.)– Agency & client responsibilities and scope of

work– Privacy, conflict-of-interest clauses– Minimum billing stipulation (if any) and ‘make-

good’ clauses if minimum billing is not achieved

– Penalties / liquidated damages for underachievement of objectives

– Bonus for overachievement for objectives.

9/2/03 adv 4312 13

Finalize & turn over to servicing

• No premature announcements

• Open champagne bottles only after client signs on the dotted line

• Especially important in case of accounts moving from one agency to another

• The work is only just beginning