Economic downturn is creating new opportunity for the nimble

With news of volatile stock markets, soaring gas prices, housing foreclosures, and bank failures making headlines, every conversation about new business understandably centers around one basic question, "Which industries should we pursue?"

With news of volatile stock markets, soaring gas prices, housing foreclosures, and bank failures making headlines, every conversation about new business understandably centers around one basic question, "Which industries should we pursue?"

In recessionary times, the tendency traditionally was for agencies to go after those industries that are doing better than average, despite or because of the economic conditions. In fact, this was one of the lessons many of those who weathered the last recession of 2001 to 2002 have built into their strategic thinking.

 Of course, there's business to be had from companies that are on the upswing. However, during the current downturn, some are finding success with a strategy that is counterintuitive. Over the past months, it has become increasingly clear that the industries with the most new business activity are the ones that are the most competitively challenged. This is diametrically opposed to the last recession, when many client companies, broadsided by the downturn, basically stopped dead in their tracks. Rather than reach outside for a new/better agency solution to help fix problems, they held tight with their current firms - even if those firms weren't the best fit.

Show me a company having a tough time today, and I'll show you a company seeking every possible competitive edge, starting with a sharp-eyed review of their agencies. Of course, this isn't just happening in the PR realm: Client marketers are looking at all agency relationships, from advertising to media, interactive to multicultural.

The mission driving these reviews is to find who can give the client the most "bang for their buck." While dollars alone are rarely the deciding factor, the search for value is always key. Even clients who are looking for "the best" in their category are negotiating longer and harder.

Driving this relentless search for improved performance further is the tremendous pressure that all companies are under to hit or exceed their numbers. In particular, the pressure on the client prospect, be they the head of internal communications or external marketing, is great. It's not unusual for the average length of employment of the client contact to be in the 18- to 23-month range. This means that the person responsible for the agency basically has one business cycle to get it right or they're out the door. Of course, this adds an additional wrinkle to the equally important issue of client retention.

The upside is that turnover is good for new business prospecting. In sum, there are and will continue to be fresh business opportunities out there for agencies to chase. The caveat: Remember that your great new client is looking to you to help fix their business problems, and fast. If you don't get it right the first time out, you might be out the door along with your client contact. But you wouldn't be in the agency business if you didn't thrive on the pressure to succeed, right? Good hunting.

Dan Orsborn is a senior partner at SelectResources International where he heads the PR agency search practice. He can be reached at dan@selectr.com.

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