One of our clients, a Midwest employee benefits agency, came to us with a serious problem. Revenues were down 19% over the previous year, despite an increased marketing budget. They spent their $137,000 budget on brand-building – including a $15,000 sponsorship of the 18th hole at the local pro-am celebrity golf tournament, a $10,000 sponsorship of the Heart Gala, full-page glossy ads in the local business magazine and half-page ads in the weekly business paper. While they couldn’t say for certain what, if any, new business resulted from these efforts, the net result was an almost 20% drop in revenue. Not surprising, but still a terrible waste of resources.
The principal of a West Coast agency asked us for help after the economy put a severe dent in his revenues. Although he created a tremendously innovative practice offering cutting-edge value-added services and built the business solely on referrals, he discovered that referrals alone were no longer a viable marketing strategy. He realized he now needed to aggressively market the agency. The old ways of marketing and prospecting no longer fill the sales pipeline. Agencies are struggling merely to replace lost revenue, never mind actually grow the bottom line. The old tools – a good Rolodex, membership at the country club, season tickets and image building – just don’t cut it anymore.
