Inbound 2012 Presentation

the art and science of selling agency services: how to stop the churn.

AUGUST 29, 2012

VAR TRACK

#inbound12

#inbound12

PaulRoetzer

founder & CEO, PR 20/20

author of The Marketing Agency Blueprint

@paulroetzer

growth is the easy part. retaining it, and making it profitable,

is the real challenge for agencies.

A Cautionary Tale of Churn

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PR 20/20 New Campaign Clients (2009)

‣15 new campaign clients

‣$195,000 in 2009 revenue

‣$503,000 in 2010 forecasted revenue

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life is good!

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1 client remains

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avg. client relationship = 11 months

Image Credit: Hollywood_PR

49% of marketers report they will consolidate or change agencies

over the next 12 months. another 15% aren’t sure.

Source: The Chief Marketing (CMO) Council report More Gain, Less Strain.

only 36% of marketers are firmly committed to their agency relationships.

Source: The Chief Marketing (CMO) Council report More Gain, Less Strain.

Churn Factors

‣Over promise and under deliver

‣Focus on outputs, not outcomes

‣Talent turnover

‣Weak processes

agency side

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‣Financial instability

‣Stretched too thin

‣Stagnant business model

‣Siloed services

Churn Factors

‣Unrealistic expectations

‣Weak foundation

‣Poor management

‣Lack of vision

‣Bad product

‣Financial instability

client side

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‣Short-term focus

‣Marketing technology utilization

‣Conservative business practices

‣Sales/marketing team strength

‣Personnel changes

‣Merges & acquisitions

the cost of bad relationships‣Agency resources (people, time,

money)

‣Opportunity lost

‣Financial pains

‣Loyal account neglect

‣Mental health (of employees, leaders)

‣Employee burnout and turnover

‣False foundation (The Red Zone)

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45% of recurring revenue is at risk to churn

The Red Zonemonitor and grade client portfolio health

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‣Commit to prospects who value your people, time and energy.

‣Watch for red flags.

‣Trust your instinct.

‣Be willing to walk away.

‣Take a more sophisticated approach to sales.

Choose the Right Clients

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make retention the priority.

1) assess strengths and forecast potential.

2) offer integrated services.

3) benchmark performance.

4) connect actions to audiences and KPIs.

1) Success Starts with the Assessment

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PR 20/20 Inbound Marketing Survey

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175+ audits completed

challenges with the current process

‣Time intensive

‣Requires high-level personnel to analyze

‣Lacks scoring system and visualizations

‣Not a true assessment of success potential

‣Fails to properly set expectations

‣Not scalable

@PaulRoetzer#Inbound12

‣Assess business and marketing strengths.

‣Forecast potential for success.

‣Build an integrated marketing strategy.

‣Connect actions with KPIs and audiences.

‣Determine talent needs and team structure.

‣Forecast agency services costs.

‣Allocate resources — time and money.

A More Intelligent Process & Platformsubjective analysis. assessment scoring. automated

recommendations.

Net Marketing Score

Every element of an organization, as it relates to marketing, can be divided into: assets, neutrals

and escalators.

@NMScore#Inbound12

Net Marketing ScoreBy evaluating and scoring these elements, an organization

can devise marketing strategies; allocate the time, money and talent; and adapt resources and priorities

based on performance.

Net Marketing Score: Model

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Marketing Manager Section NMS = 62%

Net Marketing Score: Model

@NMScore#Inbound12

CEO Section NMS = 38%

Business Fundamentals‣Business life cycle

stage

‣Competitive advantage

‣Financial stability

‣Growth goals

‣Leadership team

‣Pricing strategy

‣Product/service quality

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Marketing Foundation

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‣Brand awareness

‣ Internal inbound competencies

‣Lead sources

‣Marketing/sales integration

‣Marketing technology utilization

‣Reach

‣Website performance

www.NetMarketingScore.com

2) Offer Integrated Services

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@PaulRoetzer#Inbound12

Published January 2010

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Published July 2010

80% of chief marketing officers think integrated services will increase in importance over the next five years,

according to a study by The Horn Group and Kelton Research.

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however, in the same study, 60% of CMOs indicated that they are unable to find an

integrated firm to meet those needs.

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only 9 percent of senior marketers believe traditional ad agencies are doing a good job of

evolving and extending their service capabilities in the digital age. that means 91 percent are not!

Source: The Chief Marketing (CMO) Councilreport More Gain, Less Strain.

“There’s an underlying level of frustration among senior corporate marketers worldwide when it comes to agency contributions to business

value creation, strategic thinking, and digital marketing development.”

— Donovan Neale-May, Executive Director, CMO Council

@PaulRoetzer#Inbound12

‣Search

‣Social

‣Content

‣Web

‣Mobile

‣Brand

The New Marketing Services Mix

‣PR

‣Digital advertising

‣Email

‣Analytics

‣Tech integration

‣App development

3) Benchmark Performance

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Build Custom Scorecards

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establish expectations.

52% of senior marketers do not have a formal scorecard for rating agency performance on an

annual basis.

Source: The Chief Marketing (CMO) Council report More Gain, Less Strain.

4) Connect Actions to Audiences & KPIs

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Deliver Results

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let performance tell your story.

Client Services Series: The Case of a Hypothetical B2B Account

(Coming in October 2012)

‣Session 1: The Marketing Assessment

‣Session 2: The Scorecard

‣Session 3: The GamePlan

‣Session 4: The Honeymoon (Q1)

‣Session 5: The Reality (Q2)

‣Session 6: The Tipping Point (Q3)

‣Session 7: The Renewal (Q4)

@PaulRoetzer#Inbound12promo code: inbound15

breakups sucks.4 steps to stop the churn.

@PaulRoetzer#Inbound12

1) assess strengths and forecast potential.

2) offer integrated services.

3) benchmark performance.

4) connect actions to audiences and KPIs.

paul@pr2020.com

PR2020.com

NetMarketingScore.com

MarketingAgencyInsider.com

thank youPaul

Roetzer