How Should an Agency Incentivize Its New Business Leaders? This Study Reveals What to Prioritize

At the center of all these changes within an agency are new business professionals. After completing a study over the summer about compensation for new biz pros, NBZ Partner has a second wave that dives into how agencies incentivize that group to produce not just more but better sales leads for agencies, as well as myriad other factors that agency growth leaders are and should be evaluated on.

“Agencies are investing in their growth and new business rigor and operations in different ways,” said Rachel Segall, co-founder of NBZ Partner. “New business people are not just being necessarily leaned on for things like pitches and RFPs, but also agency branding and the PR- and marketing-related aspects of growth.”

Total compensation

The second wave of the report, created with consultancy Field Trip Department, found that 74% of new business professionals have various incentives as part of their total compensation package, and the group reported that incentives make up about a quarter of their salaries.

Overall, the report found the following bands of total compensation based on years of experience:

• 4-7 years: salary range of $75,000 to $600,000, with a median salary of $170,000
• 8-10 years: salary range of $135,000 to $215,000, with a median salary of $140,000
• 11-14 years: salary range of $138,000 to $520,000, with a median salary of $180,000
• 15+ years: salary range of $167,000 to $1.2 million, with a median salary of $328,000

Salaries have remained fairly stagnant over the past year, and despite those ranges being slightly underwhelming due to the current economic climate, according to multiple new biz folks Adweek spoke to for this story, 60% of people surveyed aren’t looking to change jobs.

“At the end of the day, this role is not billable,” a chief growth officer at an independent agency told Adweek. “If an agency is not pulling in a significant amount of new business, it’s really hard to justify someone whose paycheck [is so large].”

What should incentives be based on?

The growth role at agencies is evolving to incorporate more marketing and PR.

While overall agency performance ranks as the top factor for both bonuses (which is reasonable, given most agency leadership teams receive bonuses based on the agency’s performance) and what these employees think they should get evaluated on, it’s one of the hardest things for growth leaders to influence.

Despite agency new biz leads wanting to be evaluated on number of pitches and RFIs, Micah Freedman, vp of growth of indie shop Ruckus, said the focus should still be quality over quantity.

“If someone’s just bringing in duds, for lack of better words, you’re just wasting resources and timing,” Freedman said.

When negotiating incentives, it’s critical for prospective candidates to interrogate the company about the previous year’s goals, how they’ve changed, whether they’re realistic, and what resources they’ll have to achieve them again, Eli Pakier, the founder of Field Trip Department, told Adweek.

Given the lack of control, there are other factors agency new biz leads should consider for their incentives. Marketing and PR are increasingly falling under the agency CGO role, and with that come clear metrics to judge on, including press hits and awards.

“We have to ensure that the marketing we’re doing from a brand standpoint, maybe from a bit more of a direct response standpoint, is very active,” said Freedman, who added that everyone on the new business team needs to touch to be successful.

However, there are a number of soft skills that make a strong new business person that are harder to quantify, including relationship building—especially press and consultants, who a growth leader should be on a “text message relationship” with, according to the CGO who wished to remain anonymous for this story. “It’s the relationship side of it that ultimately does affect how people perceive your agency and whether they want to come work for you,” she said.

With the current factors that influence incentives for new biz folks, the survey found that only 50% of respondents think they have personal control over reaching their full earning potential.

Other takeaways:

• The report found a pay gap between men and women that pops up with the incentives. Pakier and Segall agreed that’s more likely a product of men having received opportunities at higher paying holding companies rather than agencies paying men and women differently for the same role.
• About two-thirds of respondents said marketing now falls under their remit, with nearly 50% saying agency branding, PR and awards are part of their role as well.
• New business teams are on average 3.7 employees, with 2.5 employees for the median.
• 50% of agency new biz folks said their incentive structure was either fair or extremely fair, versus 12% who said it wasn’t fair or extremely unfair.

You can view the full report on NBZ Partner’s site.