Winning new business in any economy, and especially in this economy, is an urgent and constant necessity for any agency.  Of course, servicing existing business should always take precedence over chasing new business, and it should be noted that there is always a cost to pitching, writing proposals and pursuing new business.

It is imperative that agencies take a long hard look on what the potential client is asking of you. In this economic climate, it is easy to see any “New Business” opportunity as something to vigorously pursue; but make no mistake, that ‘pursuit’ can often be costly and an ineffective use of time.

Case in point: While we have signed some great new business recently, have also seen and heard from some really “out there” potential clients, on which we passed.

A few examples:

An entity which asked us to write a very lengthy PowerPoint proposal, to be bound, color collated, 15 copies and presented in person by the whole account team… for a annual $70K budget (We cant spend 10% of an annual budget on the proposal alone)
 

A call just this morning requesting an RFP… which also went to 20 other agencies from whom they are requesting proposals (but won’t do meetings because of the time required for face to face meetings) 

A big brand, which asked for 3 client CEO references prior to disclosing budget or timelines
 

We respectfully passed on each of these pieces of business, and I believe its also important to say no on new business. Not all new business is good business, and in this economy, I believe there are brands who are taking advantage of agencies. 

A good client, and a good prospect is one who is respectful of an agencies time and expenses, and is up front and honest about requirements, budgets, and the process.  They are in the majority… but don’t always say yes when asked to pitch, in any business.

Ronn Torossian

5WPR

We recently lost a major RFP/new business pitch… and I am happy about it.  At the end of the day, we lost because another firm (one our size) convinced this global company that their global capabilities and “International” network was better than hiring one firm for the U.S., and additional firms in other more localized markets. 

With very, very few exceptions, to say that I vastly disagree would be an understatement.  Every single market is a unique animal and Europe is not one country. Every single small market has different languages, different cultures and different media styles. By nature, PR firms are not large in the grand scheme of business, and are even that much smaller worldwide (besides the handful of global conglomerates).

A PR firm with 10 employees in Europe may be the best firm for a consumer goods company. But is that firm really the best firm for a technology or political entity? How can it be the same?  Can an agency uniquely be best served in Sweden and also in France? Simply inaccurate.  And as much as the big holding companies who dominate the conglomerates claim that their offices work hand in hand, it’s a complete crock. Below the top levels (CEO, General Manager), no one in these offices is compensated by referrals to other offices, and it doesn’t affect their individual P & L statements for their offices.  It’s simply a crock, and no one cares.

So… sometimes when we don’t win, it’s all the best.  While we still win in excess of 80% of our new business pitches, more often than not in cases when we don’t win, companies often return and hire us after other firms over-promise and under-deliver. My advice when firms ask us for global recommendations is hire an agency market by market (which at times we have helped hire).  But the reason we aren’t part of a network is because I won’t refer business blindly to firms without thinking of a client’s DNA and needs market by market.

Clients who need global reach can and should indeed get it, but not as a cooker cutter, but instead on a case by case basis.

Ronn Torossian

5W PR

It’s rare that the tremendous value of PR in an international campaign is highlighted on the front page of The New York Times business section. Today’s feature, “Tibet Backers Show China Value of P.R.,” shows how indispensable public relations has become.

http://www.nytimes.com/2008/04/14/business/media/14adco.html?pagewanted=1&_r=2&ref=business

In addition to the reasons cited in this article, PR’s value can also be seen purely in economics. It’s simply amazing that a major RFP in the PR Industry is one with a $500 thousand annual budget. That amount would have every single PR firm in the industry chasing the account. Conversely, next to nothing can be accomplished with an advertising budget of less than a million dollars.

Because of this, among many other reasons, I expect the PR business to continue to experience tremendous growth.

Ronn Torossian
5WPR

So… today’s a day to vent:

3 weeks ago to the day we received a call from a Fortune 1000 company who claimed an IMMEDIATE need for a new NYC PR firm…. They were in town that day and had to meet with us before 4 PM. They had researched us and thought we may be a fit. They had just fired their latest PR agency and needed someone now.

We scrambled, prepared and eagerly awaited the meeting. Long story short, the nearly 2 hour meeting ended with a request for a detailed proposal which “they would love to see ASAP”… so we worked all weekend and got a proposal to them Sunday night… and an email back on Monday that they’d get back to us shortly and thanks.

We spent a total of nearly 100 staff hours preparing this document proposal… and now 3 weeks later after multiple calls and emails, we still aren’t getting a reply… Does that sound fair ?

One of the best and worst things about the Public Relations field is the quickness of winning new clients – Unlike the advertising industry which has 3-12 month RFP and long decision processes, we often win clients in the course of 2 meetings or a few weeks… but it’s frustrating when we spend a lot of time and don’t get the decency of a reply.

…. Onward and Upward….at least for this NYC PR Agency….

Ronn Torossian
5W PR