How Coronavirus Concerns May Impact Agency New Business Pitches

Some clients seem to be timid about launching reviews; for others, it's business as usual

The disruptive epidemic could cause clients to rethink everything from travel to conferencing.
The disruptive epidemic could cause clients to rethink everything from travel to conferencing. Getty Images

Key insights:

The coronavirus epidemic is bringing up some similarities to the 2008 financial crisis. According to one pitch consultant, it has brought new business pitches to a screeching halt.

“Every client that I know is basically hitting the brakes right now,” Avi Dan, founder and CEO of marketing consulting firm Avidan Strategies, told Adweek.

He cited practical considerations such as travel restrictions as well as the overall uncertainty generated by the epidemic as contributing factors. Dan explained employee health and other impacts on the supply chain are being considered.

“Clients don’t want to pitch at a time of uncertainty,” he said. “Once you have [these types of] uncertainties, unless it’s a dire situation clients aren’t going to go into a pitch.”

But not everyone in the industry is seeing such a clear, direct effect.

“I haven’t heard of any client yet saying I’m not doing this because of coronavirus,” Michael Kassan, chairman and CEO, MediaLink countered.

Although he noted one client opted to move a meeting to video conferencing while citing a policy not to allow outside guests into their business due to coronavirus concerns.

“I think it’s too early to tell what kind of impact it will have on new business pitches,” he added.

For clients who may be deciding whether or not to launch a review, Kassan said he wouldn’t be surprised if some are opting to wait. MediaLink was in the process of several RFPs. For now, the response from marketers to the potential impact of the epidemic seems to be: “Let’s see.”

For ongoing pitches on the other hand, business largely continues as usual, at least for now.

“If a client hasn’t cancelled a pitch, I can’t see an agency backing out,” a source at a major holding company agency told Adweek.

The source explained that they weren’t seeing an impact on preexisting pitches, mentioning travel for three pitches in their final stages conducted in the northeast U.S. over the course of the past week. Such pitches are often tied to events like the end of a previous agency’s contract. These clients are likely rushing to meet standing deadlines.

The source noticed canceled travel for recent meetings as well, similar to how clients cut travel costs amidst the 2008 financial crisis. This source speculated there could be a longterm impact on how clients view such costs, leading to possible reductions in travel expenditures they determine to be unnecessary. Kassan agreed that such a change could be an unintended consequence of how business responds to the coronavirus epidemic.

Any changes to the new business pitch process, meanwhile, are likely to be short-lived.

Dan said that, as in 2008, new business momentum would return, predicting it will take about a quarter for such a comeback. He anticipates a return to “normal conditions” or even a spike in new business pitches as clients opt to launch reviews they had previously delayed in May or June.

Additionally, he said, disruptive events like this could cause clients to “rethink everything about their operations” including a reevaluation of agency relationships.

@ErikDOster Erik Oster is an agencies reporter for Adweek.