Apparently, there are some new business agencies currently doing the rounds saying that cold calling is dead!

Clearly, their experiences are very different to ours at Alchemis.

 For the last 18 months (after the drought during the first half of 2009) we have witnessed an ever increasing number of wins for our clients, generated by our cold calling approach to prospects. It may sound slightly old fashioned, but it’s still the most effective method of identifying a prospect’s needs, challenges, priorities and issues.

And without that specific company/decision maker information or insight, all you can achieve via a piece of DM or an email is raised awareness.

We have run (and will continue to do so where needed or appropriate) email/DM campaigns on behalf of our clients, and have compared these to cold calling campaigns running alongside these. The statistics show that engaging one on one with marketing decision makers still deliver the best quality meetings. Some of these DM/email campaigns have helped increase access to decision makers, but only those with genuinely relevant insights. A generic campaign will neither help nor hinder.

I remain to be convinced (and would love to hear from any of you who have some proof of success) about the use of social media when targeting senior marketing decision makers, for the very reasons that I have outlined above …

Here are some top line results from the analysis of our 2010 business development activity on behalf of our clients.

They summarise why a prospect will agree to meet an agency based on calling prospects who meet the agreed criteria of vertical market, size, spend, profile and location.

1. Rapport with prospect (this scored highly in those disciplines where there are neither discernible differentiators nor clear ROI, for example, creative or corporate comms agencies)

2. Direct relevant experience supported by case studies (this scored highly in all disciplines, particularly PR and creative)

3. Proven ROI supported by case studies (particularly relevant in PR and DM)

4. Unique methodology (primarily in research)

5. Niche skill set, namely in technology (mainly in digital and research)

6. Chance of gaining insight from the meeting (mainly in creative and PR)

7. Location of the agency (again, mainly in creative and PR)

This insight into what prospects are looking for when meeting new agencies is one of the many reasons our clients win new business from working with us.

Another key reason is our ability to develop rapport with prospects through asking the right questions and being able to empathise with their current challenges.

Our Sales Director, Dave, will be writing a more detailed paper on this, so watch this space…

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.