I really like how a freelance Dutch creative duo used Twitter to get noticed  and ultimately hired by a hard-to-reach group that happens to spend a lot of time on Twitter: creative directors in advertising agencies. Naturally, I’d prefer you not to leave this site but the video isn’t available for download; its creators clearly want you to visit their Vimeo page. Here it is: Winning business with Twitter

Nonetheless, there are still plenty of sceptics out there when it comes to social media use by companies that sell to other companies (B2B) as opposed to individual consumers. Half an hour spent browsing the marketing website B2B Bloggers should be enough to answer any doubts, starting with articles like this one.

And if you still have doubts, do some further reading on Google’s latest moves to include social media activity in search results. This blog entry by Seatle-based search software firm SEOMoz explains what’s going on and why.

Most people old enough to be in senior management roles today know the slogan ‘Let your fingers do the walking’. It did wonders for promoting Yellow Pages and joined the advertising hall of fame back in 2002. But how about ‘Let your clients do the talking’? Nope, that doesn’t resonate quite so loudly does it? But it should, because credible endorsements from others are one of the most potent sales tools in business-to-business, especially if you’re selling professional services. PR professionals call this ‘third party endorsement’ (TPE) and, well managed, it can win you business, forge alliances, improve recruitment and retention, and help in a multitude of other reputation-enhancing ways too.

TPE is so powerful because it responds to a basic psychological need. In business – indeed in life in general – when presented with an important choice, dilemma or problem, we tend to look around us to see what others in the same circumstances have done. Even if we already have a good idea about the appropriate course of action, we still tend to look for external validation of that choice. Both scenarios present management with an opportunity for their firm to be seen as the best choice of solution provider.
Here’s another very good reason why TPE is valuable in marketing terms. Journalists will be much more interested in your story ideas if they are ‘client-told’ as opposed to stories told purely by the firm. Good journalists will instinctively seek out independent validation and evidence when presented with a claim. It’s part of their training to be cynical.

They also know that good stories need tangible examples readers can relate to in a meaningful way. They want drama, personality and, even in dry business publications these days, a little entertainment. Because journalists are more time-pressed than ever before, if you feed them your choicest case study morsels, chances are they’ll bite your hand off.

So, by exploiting TPE, you’ll be benefiting from powerfully-told endorsements of your services and expertise, and pushing against an open door when your PR team contact the media. Why then, are more firms not making the most of such a great opportunity? That’s something I’ll cover in a forthcoming post.

Most companies who hire marketing services firms love to assert their power by making their suppliers jump through hoops from time to time, and it’s an increasing practice. Which is why, a few times each month, suppliers of advertising, public relations and other marketing services have to participate in a time consuming and usually fruitless ‘beauty parade’ game, otherwise known as pitching for client business (other businesses use the more generally known term: selling).

I’ve been on both sides of the fence on many occasions and can tell you it isn’t pretty. Clients often draw up flaky briefs that are impossible to interpret and then refuse to be pinned down by answering perfectly reasonable questions of detail. The agency people will try to persuade the client that they’ve had their best account team giving lengthy, considered thoughts to the brief. In reality, it’s likely that most of the effort is the result of whichever individual has enough free time working into the wee hours of the night before the pitch. So it was interesting to see the results of a survey on this theme from the UK’s Public Relations Consultants Association (PRCA) reported here.

The survey, completed by 51 out of the 180 PRCA firms, found that the amount of time spent on a new client sales pitch varies widely but the average is 20 hours. That got me thinking about the cost. Fortunately, the PRCA also produces another survey called the ‘inter-firm comparison’. This is an anonymous survey allowing agency management to benchmark their businesses against other PRCA member firms on various factors, including hourly rates charged. To arrive at a reasonable cost estimate for our average 20 hour sales pitch effort we have to make some assumptions about how that time breaks down. Here are my ‘best guess’ assumptions:

• Board Director: 2 hours
• Account director: 8 hours
• Account manager: 6 hours
• Account executive: 4 hours

Using the PRCA’s 2009 hourly rates for the different job levels, and the above breakdowns for time, the theoretical cost of that one sales pitch, based on unrecoverable hourly rates alone is £2,292. Over a typical 46-week working year, assuming the agency pitches once every two weeks, the theoretical annual cost amounts to £52,716 per agency.

This figure excludes any third-party costs. PRCA communications director Richard Ellis says the 20 hour average refers to ‘time spent preparing for a new business pitch’. We must therefore assume it does not include the time travelling to, from and attending the various pitch process meetings, multiplied by the number of people from the agency involved; it looks a bit on the low side otherwise. Neil Backwith* thinks so too. He tells me 50 hours is the average time investment for a new business pitch made by the groups of PR firm CEOs he works with. If we use Neil’s figure, the annual cost jumps to £142,312 per agency. But even this might well be conservative. Ellis says the survey figures “went into the ‘over 200’ at the other end of the scale”!

Who pays for all this? Clients ultimately, of course, but indirectly through the fees agencies have to charge for their services. As Backwith points out,

“By asking more agencies to pitch clients will end up paying higher rates for the privilege – quite the opposite of what they hoped for!”

Do they and their procurement colleagues realise this? Do they care? Is there a better way? Microsoft’s Peter Devery clearly thinks it’s time for a change, stating in a recent PR Week article that:

“…. the PR pitch beauty parade is a legacy of an old industry. The process is lengthy, costly, resource-hungry, inefficient and often does not result in the required level of understanding which will lead to a fruitful partnership. We have to move the industry on, for both the agencies’ and clients’ sake.”

Some in the agency world are fighting back by banding together and refusing to pitch. But sadly it’s the Belgians who are doing the rebelling, not the Brits.

Postscript Feb 2011: I’ve just discovered www.winwithoutpitching.com, founded by Canadian Blair Enns. The resources on his site are well worth a look.

* Neil Backwith is a management consultant, trainer and mentor to professional services firms and their leaders. He was previously chief executive (EMEA) at PR firm Porter Novelli. He is author of the PRCA book ‘Managing professional communications agencies’.