The short answer to this is “it depends on your budget…” But as there are so many variables that contribute to a productive and profitable new business campaign (in fact, far too many to address in one blog), I will focus instead on what the best options might for a particular budget. There are a few caveats to consider, but read on to the end to see these along with some anecdotal evidence from agencies who have “been there and done that” from both sides of the fence.
Let’s assume the following to be the case:
Then we can isolate cost as the major determining factor as to which of the following routes you take:
1.) In-house solution
This is a contender for budgets of £60K+ and a very strong option if you have an insatiable appetite for new clients and can commit £80K or more. It’s not a great option if you’re not prepared to invest at least £60K and / or are not prepared to bide your time before getting started.
There are two ways one might resource an in-house new business solution:
A good new business person will expect a package of £40K+ depending on A&E, level of responsibility (just lead generation or the complete sale?), location and what your agency specifically does. If you want a self-starter that can come in and ‘run new business’ for you then you are probably looking at £60K minimum but then you have to consider the following:
All said and done you will not get much change out of about £80,000 but if you get the right person then I believe this can be the best way to spend an £80K budget. You will have the undivided attention of at least one person equating to 20 days per month compared to about 10-12 days from a new business agency.
Please don’t make the common mistake of asking your new biz guy to handle clients once they have been won. We often hear of agencies cannibalising their new business resource – in fact it’s a common reason for deciding to use us instead!
If you get the wrong person, then you’re back to square one having spent more money and lost more time. Recruiting great salespeople isn’t easy (believe me), so you shouldn’t expect the success rate you achieve when hiring creatives or developers. Finding someone with direct experience of working for a similar agency or new business agency will increase your chances of getting it right.
An alternative approach that many have been tempted to try is re-tasking one (or more likely, some) of your current team. Most of the costs still apply but it may seem like you are saving money on recruitment. This is an illusion. What is the opportunity costs of taking someone that could be billing a client and putting them on to new business? And do they want to be doing it in the first place? If you’re not careful you could be looking to hire 2 people….
2.) Outsourcing to a specialist new business agency
This is a strong option for budgets of between £20K and £80K and I would say the best option for budgets of £30K-£60K
If you hire a new business agency that specialises in the marketing/creative/digital agency world then you should expect the following:
There is no way you could expect this from an in-house option below £60K (realistically £80K) and it’s very unlikely a freelancer could deliver it either as they will not have scale or resources. As an agency owner yourself who has been on this side of the argument with clients, you already know this.
This isn’t to say an agency is a 100% ‘sure thing’ but a good agency will want to get it right and, crucially, they will have the means within their team to get it right, which means they can react quickly to your feedback or concerns if the campaign has started slowly.
This is a probably the only option for budgets below £20K, but if you find the right one they can be your secret weapon.
There are some very good freelancers out there. We will often refer potential clients on to freelancers we know if they are not a good fit for us. If you choose to go down the freelancer route then it’s imperative you hire someone that has a previous track record within a new business agency or, doing new business in-house for a similar marketing agency to your own. I would also want my freelancer to have a couple of years freelancing experience under their belt as well, which ought to mean they have made most of the mistakes they’re going to make and already know their strengths and weaknesses.
Across these 3 options there’s something to suit everyone and there’s nothing to say you can’t mix and match. We have worked successfully for clients that already had a fully developed sales team in-house. Typically, we will be tasked with a new initiative, and they have outsourced it to us because they didn’t want to dilute their core focus. We have also worked with agencies that have continued to retain the services of a freelancer.
Most agencies that are not currently running a proactive new business campaign will probably be looking at one or other though, and whilst there is some overlap at certain price points, at others it is very clear-cut.
So which of these sounds most like you?
>£80K budget, aggressive growth targets of £600K+ in 2023 and war chest to match. Potentially 1 new client per month
You should definitely consider biting the bullet and trying to find the person or team that can join your business and deliver this. It will take time so you could also consider hiring a new business agency or even a freelancer to kick start the process. If you do, then your new hire should be welcomed with a pipeline of warm leads and you may have learned more about what a proactive new business process looks like.
I recommend you look at both options unless you have a very strong preference for one or other.
£30K-£60K budget, looking for £200K+ in brand new business. Potentially 3-6 key clients
A specialist new business agency is your safest bet. This isn’t to say you couldn’t get a great person on board for about £50K all-in (data, software, bonuses etc) but it becomes very difficult below £50k. If you’re one of the rare agencies that has managed it then you have done very well!
An established new business agency that specialises in marketing services will probably want at least £30K for a standard campaign, but in certain circumstances it’s possible to make a lower budget work. If you have a finite list of key prospects you want to work with then these could be hit hard in the first 4-6 months before activity (and therefore monthly fee) is scaled back to timed call-backs over the remaining 6-8 months.
It has to be a freelancer (but you won’t be getting more than 4 or 5 days a month at that budget for an experienced one).
But what about the caveats?
There may be some of you surprised at these budget figures and saying “well, these are London prices!” Having a client base stretching right across the UK, our anecdotal evidence would suggest that as it stands today these amounts are national (if you want to attract the right calibre of employee with sufficient access to data, leads and resources to bring in a significant new business revenue).
There are various methods that some business development agencies/consultants may use to justify fees, but it’s always worth carrying out due diligence. A genuine agency (or freelancer) will be transparent and be able to provide full accountability and reports outlining their process and activity throughout the campaign.
And finally, just as you wouldn’t take on a new employee without obtaining a couple of reliable references, the same rule should apply if you contract a freelancer or new business agency.