Those of you who have seen Glengarry Glen Ross may remember the scene where Ed Harris is telling Alan Arkin about what he learned when he first got into the sales racket:

“You don’t sell one car to a guy, you sell him five cars over fifteen years. But those guys who come in and burn everyone for as much money as they can get and then go to Argentina ruined a good thing.”

I can think of several household name companies off the top of my head that fall into the “burn everyone” category in order to boost sales, particularly within telecoms, utilities and banking. One of the reasons that Nationwide’s “brand new customers only” parodies a few years back were so successful was because so many people have had first hand experience of this type of practice.

It could be argued that we were all brand new customers once. We all had our slice of ‘enticement cake’ when we signed up, so we should just stop moaning and eat the gruel for the remainder of our 24-month contracts. But for every month of gruel I dream about the day when my contract finishes and I can stick two fingers up to the offending corporation and say “You just lost yourself a customer, mister!”

Now I’m sure that my actions won’t be causing sleepless nights to the top brass at the likes of Vodafone or Natwest. But I do have a long memory for perceived injustices against me by big faceless corporations and I’m pretty good about sticking to my guns of never using certain brands again once they’ve made it onto my blacklist. I’m also pretty good at moaning to anyone who will listen about what poor service I had from said brands – and brand reputation can be raised or lowered quicker than ever before in these days of internet review sites, online consumer forums and social networking sites.

So now to my point: according to research from insight group SMG, retailers are expected to spend 64% of their marketing budget on new customer acquisition by 2015 – this is despite the fact that long-term loyal customers are more profitable in the long-run.

New business is vital to any organisation. Whatever industry you are in, there will inevitably be some natural wastage of your client base, sometimes for reasons beyond your control and sometimes not. So for that reason it is crucial to have a pipeline of prospects in order that your business can grow.

At the same time, customer retention is apparently more profitable (although there will be a significant variance of this between different market sectors) and that’s where the business development side comes in. Build lasting relationships with the clients you have in order to sell them more in the long run.

It’s a fine balancing act, but there’s no point in having one without the other.

And finally, to my response to number 5 in my list of the 5 most frequently asked business development questions (in my experience):

How will you get to know not only my agency’s offer but the personality of my agency?

A crucial concern for a lot of agency owners, as we are representing their brand on the telephone; a brand which they have often built up over years with a lot of blood, sweat and tears and therefore the last thing they want to happen is for Alchemis to misrepresent them.

I often draw parallels between outsourcing new business and sending your precious child to school. You’ve done a great job in bringing them into this world and giving them the basic skills, but now it’s time to send them to the professionals for the next stage of their development.

All 3 of the working owners of Alchemis are parents (and I’m a recent grandparent too!) so we understand this and take great care to ensure we understand what your agency and your people are all about, as well as obviously getting to grips with your work and your case studies.

We do this through a structured and an intuitive approach to briefing. This involves an initial set up where we discuss your case studies and agree your offer to market and your target prospects – to demonstrate our understanding of your offer, we then write a campaign plan which summaries your key selling points. This is then often followed by an immersion programme which varies from client to client and can involve standing on Waterloo station handing out samples, attendance at relevant exhibitions or simply spending a day at a client’s office. This immersion tends to follow some calling activity, as by then our New Business Managers will have feedback from the market and therefore some informed questions to pose.

Rest assured, we will look after your brand as though it was our own…..

Anyone engaging with a new business agency would see budget as being a key part of the qualification process:

“We don’t want to meet anyone without an approved budget for our marketing services!”

On face value that is a perfectly valid comment and it is always something Alchemis has highlighted as part of our core meeting quality criteria. However, more and more of our clients are developing propositions around very targeted offers and services, which revolve around specific client issues. This is great news as we are able to offer something unique and different, but as a result, whilst these offers provoke interest from the prospect, it is unlikely that they will have an allocated budget for that specific activity.

This is where the new business approach to qualification needs to change. Would that offer or service provide a solution to a business need that the prospect has? If the answer is yes and we can convince the prospect that this is the case, it is not necessarily about allocated budget, but more about the authority and decision making power of that individual within their organisation. If they can see a true benefit, a budget can always be found.

In terms of the new business process, you have grabbed their interest and the next step is to persuade them to create or reallocate budget for that activity. It could be that you now need to work with that prospect to build a business case internally. This is time consuming and often arduous, but this kind of approach, should it be successful, is likely to result in stronger relationships.

At the end of the day, of course there needs to be a significant “marketing” budget in the first instance and that needs to be qualified. However, from the perspective of a business development partner, the emphasis really needs to be on the decision making power and authority of a prospect. Qualify that and you are over one of the largest new business hurdles.