The AAR publishes its annual summary of pitch opportunities in 2009 and predictions for 2010. Key statements include:
- Number of new business pitches down by 21%
- Advertising reviews down by 20%
- Digital pitches suffered a 33% decline
- 24% less DM reviews
- Full service media pitches down by 24%
It could be argued that this is tantamount to scaremongering. I’m sure this is not the case, but on face value these are concerning figures and offer little optimism for recovery in 2010. However, if a step back is taken, previous figures are considered and everything is overlaid with common sense, there are certainly reasons to be optimistic for the right kind of agencies with the right kind of business development outlook and strategy.
To a degree, the figures should be taken with a pinch of salt. In January 2008, the AAR reflected on the figures from 2007, stating that direct marketing pitches were down by 47% from 2006. However, the likelihood is that, at the time of the digital boom, pitches were labelled as “digital” despite containing a heavy element of traditional direct mail. It transpired that direct marketing pitches increased by 10.4% in 2008. What does an “integrated” pitch get labelled as in the AAR statistics, as the make up of that pitch would differ each time? What is clear is that the pitch discipline waters are too muddied to develop any real insight or identify any true trends.
That said, the figures are interesting, but more in part, due to the fact that the pressures of 2009 forced marketing decision makers to review their actual pitch process rather than the agencies they used.
The pitch process is a long and laborious one and with increased pressure on time and resource, one that marketing departments could well do without. On top of that, in times of economic downturn, the client is king. Incumbent agencies will bend over backwards to retain an account and inevitably clients are able to drive down fees and demand more for their dollar.
However, if that were true across the board, there would be no new business opportunities and we know from our work and from our clients that this is not the case. There is no doubt that there has been a rise in the stock of small to medium sized agencies able to offer that “big agency” experience, but with the flexibility, cost-effectiveness and high service levels only a smaller agency can provide. Pitches involving this profile of agency may well fall outside of the AAR’s remit.
The AAR summary also rightly identifies that clients are moving agencies without pitching. For new business agencies and their clients, this signifies the Holy Grail. A core aim of any new business program is not predominantly to get agencies onto pitch lists (indeed, in some campaigns it is a key objective to avoid them). It is to get you and your agency in front of the right kind of prospective clients with the right kind of work and the right kind of budgets. If we can get you in early enough and we can work together to build that relationship, possibly undertaking smaller “test” projects on the way, the need for pitching is often negated. That is the beauty of a well handled, proactive cold calling approach. Often smaller agencies are involved in a pitch to “make up the numbers”, so why not push to develop that relationship and prove yourself before that review/pitch takes place.
A “back door” approach will ensure you are front of mind when reviews are happening and a good new business program will help you achieve this.