I know our quality of service is far superior, and I know that all the people (or at least 90% of the people) pitching lower prices than us won't be able to deliver an end product that will be of much benefit to the client (even if they do manage to fulfil the technical requirements).
We want to actually talk to buyers to figure out how and if we can actually help them, but most insist on us just sending a quote so they can screen everyone based on pricing before proceeding to discussions.
Remember when you start a business or are an established business you have to decide who is your perfect customer, since not all potential customers are equal, and not all potential customers are profitable. It is likely that the type of customer who is purely price orientated like those on Elance etc. may not be profitable to your overall business success as it is very unlikely they will pay you more in the future. You would be better focusing your marketing attempts on finding customers who do appraciate your work and understand the added value your agency has to offer, than chasing jobs, by people that only value you and your business by lowest price, which is a business model that can only lead to failure.
Having successfully procured contracts for proposal writing through Elance, Freelancer, and oDesk, I agree with Craig that defining your targeted customer is extremely important and even more so now that competition is global and platforms such as Elance enable instant connections between clients and contractors. Many potential clients on platforms such as Elance, Freelancer, oDesk, etc. are purely looking for low-cost contractors. As your business doesn't sound like one that is willing to compete on price, then you need to pursue potential customers that are willing to pay a premium for your services.
In my experience on these platforms, you can generally tell the willingness of a potential client to pay a premium by the effort they put into the job description. A simple one sentence request for proposals is probably coming from a potential client that is looking for the cheapest contractor. On Elance you can also pay for a premium membership allowing you to see what budgets other freelancers are submitting. This will enable you to see if you can be price-competitive. Finally, I have also had clients come back after working with a low-cost contractor whose quality of work wasn't satisfactory. Some potential clients may realize that they get what they pay for. So, it doesn't hurt to submit some proposals in which you may be at the high end of cost - it's a good way to get your name out. The client may come back to you.
Good luck with your efforts. Please get in touch with me if you want more details on how I approach platforms such as Elance for my business.
You will need to learn how to market your services in another manner, elance is good if you are starting out or want to play the lowest bidder card. Once you have a portfolio and produce quality work elance.com is not that great. Start with networking events and current customers.