In a recession, agencies often misread the reasons why clients start to reduce budgets. It’s thought that clients have become very cost conscious. So agencies start to reduce fees to try and appeal to this ‘shrinking’ market.
In my view, this is a big mistake because the reduction in budgets is not driven by a desire to reduce cost but a desire to be certain of a good return on investment. In fact, in a recession, ‘economic’ buyers become much more value-focused than they are in a buoyant economy. They want every penny they spend to deliver a clear and healthy return or they’d rather not spend it.
So, the secret of success in a recession is to become recognised as a provider of value – not a provider of activity. The latest research from the PRCA demonstrates that 83% of agencies do not sell by value. This represents a significant threat to their future during the recession because it means there is unlikely to be proof of value needed to sustain the budgets clients currently allocate for their services. If agencies don’t start proving the business value of what they do, the consequences (based on previous recessions) are likely to be loss of income and talent and a significant impact on the future growth potential of the agency.
However, the flip side is also true. If an agency is seen as a provider of business (and communications) value it will outperform the sector. It is also likely to pick up budgets from other disciplines that struggle to show as good an ROI.
But making the shift from selling time to selling value doesn’t come naturally to agencies because selling time has been grained into the psyche of the sector.
And that’s where the latest course from the PRCA comes in. How to sell value – demystified is a two-part training course that will provide an agency’s leaders with a step-by-step guide to making the transformation quickly and effectively. It’s designed to be completely practical and will suit those agencies who don’t want to take part in a ‘race to the bottom’.
The course will introduce the steps required to make the shift to value from time. It will cover the following:
Part 1
The business case for selling value not time
The seven deadly sins of time-based selling. This will cover the weakness of a retainer mentality, the need to identify time and value drains
Identifying the value clients want - and examples of companies who have targeted the value clients want. The power of a WHY that makes value explicit
The power of a branded methodology that builds trust and confidence and sets client expectations correctly
The tools that bring a branded method to life and give the team ways to reinforce it
Examples of premium-priced services that break the time-based pricing model
Part 2
How to set a value-based price. This covers the role of a client’s business objectives and of time in calculating the price to charge. It will include questions to ask, examples of pricing options - with comparisons with time-based models and, how to price for longer term outcomes, such as a license to operate
The importance of client data in proving value and driving effective evaluation - with examples
How to get the team to sell value
How to get the team to focus on outcomes, not activities. The importance of business priorities. How to allocate time and reinforce the value delivered every day
How to move existing clients from time to value
If you want to be seen as indispensable by clients as they fight to succeed in the recession, then book this course now. But hurry there are only 10 places available.
Visit our training page to see what courses are perfect for you here.