No business like new business

Even if you’re flat out looking after your existing clients it doesn’t pay to neglect new business development, says Mike Exon

Developing a new business strategy can be a daunting task for the small consultancy whose staff are already working all hours of the day. Many design group heads know that existing clients take up so much attention that developing new business prospects cannot be easily prioritised.

Not good enough, say the experts. New business should form the third strand of a consultancy’s activity, alongside running the company and existing client work. Failure to treat it as such is often the stumbling block to growth.

Appointing a business development person full time may seem like the ideal solution. But even that can cost more money than you are prepared to spend long term. Outsourcing is often a better solution because it is flexible, accountable and can be most cost-effective, says Simon Rhind-Tutt, founder of independent marketing services group The Tutt Consultancy. His company has advised more than 40 design groups over six years.

“Design consultancies hire a business development director as if it is the panacea which will solve all their problems. We have found that the requirement is usually the symptom of a bigger problem about marketing a consultancy. Too many people hire someone without putting a strategy in place first,” he says.

Rhind-Tutt believes the reason for pitch lists being too long is because consultancies fail to differentiate themselves to clients. A consultancy first needs to position itself clearly in terms of its particular niche, make clear new business objectives, and only then outsource, he says.

But outsourcing can have mixed results, particularly if done cold. London design consultancy Sea’s disastrous experience of hiring a telemarketing firm has been echoed by a number of designers. The trick is to find the right one.

Sea creative director Bryan Edmondson says his consultancy appointed a design sector telemarketing group which charged £350 for every client meeting arranged. Things seemed to be fine until one day, at a meeting the agency had arranged, the client revealed she had “only shown up to get the pestering nuisance of a salesman off her back”. The group was stunned, says Edmondson. “We realised this company had been dragging our name through the mud rather than doing us any real service.”

“We became concerned too about how the company would share out work if there were so many design consultancies on its books. It seemed like we were effectively competing against other groups it was working with, for the same jobs,” he says. Other problems with phoney leads and client hounding were suspected, and the telemarketing group was promptly ditched.

On the other hand, Farnborough consultancy Mirror Image appointed telemarketing group Rainmaker (formerly Benchmark) to take over the job of calling prospects due to a lack of time and confidence in its own attempts. Until that time its approach was to target some clients, send them a brochure or sales piece and then call them. This would be followed by an appointment, and then hopefully converted to a contract. The consultancy appointed Rainmaker, in January 1998. Rainmaker guaranteed four new appointments every month and was paid a retainer (roughly £2000 a month), plus a fee for every conversion to a contract.

Mirror Image account director Stephen Sharp was pleased with the group’s work and the professionalism of the company’s approach. “As if by magic, it produced four new appointments every month, and most were good. It confirmed the appointment a day before, sent a map, followed it up with us two days later and gave us monthly reports. We converted a few of the appointments and everything looked good,” Sharp says.

In October, Mirror Image took the decision to set up its own telemarketing department and appointed a business development manager/PR person to improve the return it was getting on investment from new business.

“In the ten months we have been operating this it has been considerably more successful. The key is good people – and we didn’t get that right overnight. But once you have, it is easier to sell yourself with passion rather than through a third party,” says Sharp.

Nick Farnhill, business development director at digital design group Deepend, agrees. He says the prospect of outsourcing such a delicate and crucial function as new business was unthinkable to Deepend, even when the business was much smaller.

The Merchant Group partner Robert Moser feels that entrusting information as valuable as marketing data to a third party is a giant risk in itself. Not only should it be kept in-house, it should almost be kept under lock and key, he suggests.

“Although I am not saying a telemarketing group would act illegally, if for some reason a competitor were to get hold of that sort of information, it would be like gold to them. It’s just not worth the risk,” he says.

These horror stories are acknowledged by Rhind-Tutt, and although he agrees that the cowboys do exist, he does not acquiesce. “The thing is these companies are generally very good at what they do. There is a real skill to getting leads on the phone, and if managed properly a telemarketing company can be invaluable to a design group looking to generate business.”

His advice is to spend some time contacting a number of groups, and to insist on meeting the actual person who will be doing the calling. Get to know them, thank them and reward them for meetings they obtain. Treat them like a member of your own staff and they will repay you in kind, he says. Once they have got you a meeting it is up to you to follow up and nurture prospective clients. They simply get you an appointment and from there you should do the rest.

Remember too that telemarketing companies range in size from one-man bands to call centres with hundreds of staff. If you are a small consultancy looking to preserve a degree of company character with prospective clients, you will probably feel most comfortable without the impersonal vastness of the larger companies. They are skilled at negotiating the long corridors of corporations, but sometimes lack the delicacy that most designers would like.

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