Is a pitch you probably lose still worth entering?

A pitch is a gate, then another gate, then a client who may or may not stay. The tree prices all four levels at once and shows that a pitch you lose 80 times in 100 is still worth entering, right up to the point where it is not.

Marketing Intermediate Decision Tree Pro engine

Install free How decision trees work

After you install, this is the model to open.

Should We Pitch for This Account?

In your spreadsheet, click the Sortia icon in the strip of icons down the right-hand edge. No strip? Click the arrow at the bottom-right to open it. You can also use Extensions, then Sortia, then Open Sortia.
Click Start from a template and put that name in the search box.
Pick the card with that name and click Load this template. It arrives on a new tab with real numbers already in it.

This one runs on a Pro engine, and every free install includes five full-quality runs on your own numbers, shared across all five Pro engines rather than five for each. After that, Pro is $199/year.

The answer

Pitch: $66,370 expected value against $42,000 for declining
The pitch premium: $24,370 what entering is worth over billing the time
Odds of the prize: 13.2% shortlist, then win, then the client stays three years
The prize: $623,000 one winning path pays for every losing one

A pitch that costs $67,000 of unbilled time and production, against three weeks of senior time you could bill for $42,000 instead. Getting shortlisted is 55%, winning the final from there is 40%, and a client who signs stays three years 60% of the time. Open the Decision Tree tool and click Run. Pitching comes back at $66,370 against $42,000 for declining, so the pitch is worth about $24,370, and the tree says enter it.

Now read the risk profile, because it is a strange looking thing to be told to do. You lose money on 78 of every 100 paths: on 45 of them you are not shortlisted and lose $18,000, and on another 33 you make the final and lose $67,000. Only 13 in 100 paths (13.2%) end in the outcome the whole thing is for, which is a client worth $623,000.

The average loss across all the losing paths is $38,731 and the one winning path is worth sixteen times that, which is exactly how new business works and exactly what the average pitch conversation never says out loud. Two numbers decide whether that stays true, and both are worth checking before you commit the team. The first is the chance of winning the final.

At 40% the pitch is worth $24,370 more than declining. At 31% the two are level, and below that you should decline. So a pitch where you privately think there is an incumbent and you are making up the numbers is not a 40% pitch, it is a 15% pitch, and the tree says walk away from it. The second is retention, which is the number agencies never put in a pitch decision at all.

At a 60% chance the client stays three years the pitch is clearly worth it; at 36% the two options are level. If this is a client who runs a review every eighteen months, the account is worth roughly half what the pitch deck says. What the tree cannot tell you is what the pitch buys you when you lose. Credentials work, a relationship with a marketing director who moves, and a case study you can show the next prospect are all real and none of them is on this tree, so treat the $24,370 as the floor rather than the whole answer.

To make it yours, put your own three week billing value on the declining branch, your own real pitch cost on the two losing leaves, and your own win rate at each gate from the last two years of pitches rather than from the ones you remember.

The model

It arrives on a tab called Template: Should We Pitch for This Account, carrying these columns:

ID
Parent
Type
Label
Probability
Value ($k)

Once it is in your sheet

The model arrives with real numbers in it and runs as it stands, so you can press the button first and understand it second.
Change the numbers to yours. The sheet marks which cells are inputs and which hold formulas, and most labels carry a note explaining the row.
Press the run button at the bottom of the panel. It is labeled for the tool you are in, and the result lands on its own tab, with a written reading of it beside the figures.

Never used Google Sheets? Start here goes the whole way, in seven steps, and assumes nothing.

Next question

Every model like this one, and the method behind them: Decision trees.

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