Never pitch to strangers
I wrote this article about 3 years ago and given recent conversations with my agency clients I thought I’d re-post with some updates to the content and some additional advice.
When agencies I’m working with want to improve their new business success I ask them to analyse their historic pitch conversion rates. They typically discover their conversion rate is 4-5 times more successful when they pitch to prospects where there is a ‘warm’ relationship versus where the relationship is described by the agency as ‘cold’. Even as a rule of thumb this ratio is too great to ignore. I also ask them to add up their total new business investment over the previous 12 months and divide by the number of pitches. This gives them an average cost per pitch.
New business pitching is a huge investment for many agencies.
Choose wisely where you invest. See new business prospects as investment opportunities. Not all pitches are worth going for while others might be right in your sweet spot.
It starts with the relationship with the prospect. We do business with people we like. Be likeable, be interested, be interesting, don’t be sycophantic. We do business with people like us. Find similarities, connections and commonalities.
We do business with people who like us.
Like your clients and prospects. Take time to get to know them. And most of all build their trust.
If prospects refuse to let you get close and/or meet with them, then think very carefully before agreeing to pitch. They don’t want a business relationship with you. They just want a price or free thinking or free consultancy, or worst of all, all three.
Ask cold prospects how they came to contact you. Were they recommended, if so by whom? Did they find you on a Google search? Did they read an article by you or heard you speak at a conference? Their answers are useful in helping in your decision as to whether to proceed or not.
So why shouldn’t we pitch to strangers?
- Your conversion rates will considerably lower with ‘strangers’.
- There’s likely to be less trust in the relationship.
- Prospects are less likely to open up to you regarding their true needs.
- They are more likely to lie about budgets.
- They are less likely to pay a premium for your work.
Many clients are risk averse and prefer “the devil they know” – that’s their incumbent agency. They value consistency, predictability and certainty.
What if there is a so called “great opportunity to pitch” where there is no existing relationship between the agency and client company? Ask yourself some ‘investment’ questions before deciding ‘go/no go’. ‘Is this an industry or sector we have enormous experience and credibility in?’ ‘Is the prospect being forthcoming to build a serious relationship with us?’ ‘How much does the average pitch cost your agency – is this a worthwhile investment?’ ‘If it were your money would you invest it in this pitch?’ ‘Is your time better spent with other existing clients to grow your business with them?’ If you still decide to go for a pitch to a stranger then find connections and similarities, build trust with senior decision makers, (don’t waste time with junior cold prospects), ask great questions and actively listen. Turn the stranger into a friend.
Make sure you’re talking to the decision maker. If you’re not talking to the decision maker your likelihood on winning the pitch are further reduced.
In a nutshell, choose carefully who you pitch to.
Chris Merrington has studied what the most successful agencies do to grow. He is the author of “Why do smart people make such stupid mistakes?” – A practical negotiation guide to more profitable client relationships for agencies He regularly runs Masterclasses and Workshops with agency directors and sales teams sharing the gold nuggets he’s discovered to transform an agencies profitability and productivity. He’s a professional conference speaker, business growth consultant and business training consultant. He can be contacted at firstname.lastname@example.orgTagged in agency client, agency clients, Agency Training, B2B, cold prospects, Pitch to win| no comments