If there’s one word that describes 2022, it’s inflation. It’s affecting everything and everyone. It’s sucking the air out of the staggering growth that most brands and agencies have become accustomed to in the past 24 months. If you’re like most, 2022 started fairly strong but by the end of Q1 momentum started slowing.
This isn’t the Bear Market of March 2020
We all remember the circuit breaker days of the market falling off of a cliff in March of 2020. It was a panic-inducing few days that felt like years. It didn’t even qualify as a bear market and in hindsight was just a few really down days. It sparked the most rabid bull run that seemed to have no end.
By the end of 2020 agencies started reaping the benefits of that bull run. 2021 was marked by record-breaking growth for most. Outbound, inbound, referrals – new business was everywhere. The biggest problem was how to staff all the new business.
The bull run has indeed ended and there are no stimulus plans on the horizon. Until inflation is under control, the plan is to cool the economy not stimulate it. It takes time so the present market we are in is likely not going away in the near future.
A Well-Rounded Outbound and Inbound Strategy is More Important Than Ever
There have been fewer RFPs this year compared to last year. After Russia invaded Ukraine and supply chains were disrupted, there seemed to be an unspoken pause in the market. Everyone was waiting to see if the problem was temporary or if there was a downturn looming. Consumers were still spending like they were in 2021 and then April came around and reality set in that the downturn was real. The silver lining is now that the situation is clear, brands are starting to make decisions again. It’s not anything like 2021, but brands are putting strategies and dollars in place to address the market we find ourselves in. As an agency, a strategic outbound strategy has never been more important. It’s part of any good business strategy, but it acts as a hedge in downtimes. If your clients pull back on spending or fall off stating the economy, having a robust funnel of opportunities to backfill that revenue is crucial.
Brands Are Hungry For an Expert to Help Them Navigate This Environment
The one thing this market does have in common with March – October 2020 is volatility. Target is a perfect picture of that volatility. They missed their Q1 earnings for the first time since 2018….by a whopping 29%. They reported on May 18, 2022 and when asked by an analyst at Barclays why they didn’t give a pre-announcement that it was going to be this bad on analyst day just 2 months earlier on March 1st, Brian Cornell their CEO replied, “as we stand in front of you and others in March, we did not anticipate the rapid shifts we’ve seen over the last 60 days. We did not anticipate that transportation and freight costs would soar the way they have as fuel prices were then risen to all-time highs. While we were certainly anticipating the impact of overlapping stimulus and our consumer and guest returning to more normal activities, we did not expect to see the dramatic shift in many categories that we’ve talked about, the shift from categories like TVs to luggage, from small appliances to toys, and guests celebrating being out with friends. That certainly impacted our business in the first quarter, and we expect that to continue in Q2. And we certainly didn’t anticipate the impact that would have on our supply chain costs. So, things changed rapidly after we sit on stage in New York. We own that. It’s what we’re adjusting as we build our plans for the balance of the year.”
Brands are looking for agency experts to help them navigate the volatility. POV thought leadership pieces and problem/solution pieces go a long way in this market. Because of the volatile conditions, the needs are changing at a rapid speed. Your outbound messaging needs to change as the landscape changes. Focusing concise messaging to your Right to Win categories will land you new opportunities to thrive in a down market.
What’s Your Right to Win?
Right to Win is defined as the prospects/brands that best fit your prospective client profile of a perfect client. Whether it is focused on an industry, size company, regional location, etc. They are a brand that essentially should have been a client yesterday because there is no other firm more qualified or set up to work with them to achieve their marketing goals.
Here’s how using Right to Win can get your 2022 really booming in the 2nd half of the year:
1. Right to Win clients close faster
This is because they are brands you are familiar with, you understand their business at an intimate level, and the brand most likely recognizes that expertise because of your team’s language, pitch, and website focus. Faster deals mean more growth and profitability.
2. Pitch when you are the front runner
Pitching is far from an exact (or even fair) science. It is a costly and timely process that can pull your team’s focus to a project that, potentially, you never had a chance to win in the first place. Unfortunately, you do not know that until the end of the pitch, so let’s be sure we are only pitching those that we know are the front runners, or in the case of proactive outbound pitching, are the only ones pitching.
3. The right clients maximize all areas of your business
The inbound are low-hanging fruit and the revenue feels like it’s just right there, only we know from decades of experience that taking a client because they generate revenue, rather than them being our strategic best fit can have many unintended consequences on profitability, churn levels, and employee engagement. Right to Win clients are set up to maximize profit, reduce churn, and increase employee engagement…don’t settle for revenue, aim to maximize everywhere.
Brands Are Hungry For an Expert to Help Them Stand Out
While there is a lot of talk about recession, Auto is the vertical that has hit recession-level declines. Most verticals are still spending and will be planning and spending more than they did in the previous quarter. Now more than ever, brands want to hear from an expert that understands them and can help them stand out in a meaningful way. It’s time for your agency to focus on that expertise and drive those Right to Win clients right into your agency’s open arms.