The future of agencies
The ever-challenging nature of agencies, increased in-house teams and changing economic times are all contributing to the difficulty agency-owners are facing on a daily basis. What is the best direction for future-proofing? How can your agency gain real competitive advantage when all agencies are stepping up their game or diversifying?
It's common to feel stuck or overwhelmed when faced with these kinds of decisions, and even paralysed by the seemingly endless options or directions the agency could go in to adapt as a business. No agency wants to live or die by a single client, so many have diversified and spread risk broadly across a breath and depth of a client base and industries. So, that mitigates some risk from retained clients. However, what should agency owners really consider to get ahead of the game?
1. Be brave
The first thing to remember is indecision is the worst decision of all. Sure, you can make mistakes by taking what turns out not to be the best choice, but nothing ventured nothing gained, and it's usually far better to take action, learn, rectify where necessary and move on. I meet so many agency owners and managers who are paralysed by indecision, or lack a real clarity with what the agency stands for and what it sets to achieve (their 'why'), and years down the line nothing has improved for them, whilst their competitors who took the risk are light years ahead. Bite the bullet and be brave. Make the decisions needed to move your business forwards, and avoid standing still, or worse going backwards.
2. Think agile, not traditional
As we discussed in our 2019 marketing trends blog, the agency model is changing. In line with managing risk, many agency MDs and CEOs are creating an adaptive workforce, to avoid having a full stack of permanent teams on the regular payroll, when billable income doesn't align well per-head. Huge benefits can be had from a fluid workforce, with the right relationships between agencies, partners and freelancers and consultants. However, this isn't just a blog about 'why your agency needs a consultant', and there are many reasons why a core permanent agency unit is beneficial for the business, not least for long-term client relationships. But having fluidity in your teams and the way your agency works can be sold as a benefit to your clients as well as helping to keep agency operations manageable. Increasing pressure over client budgets as well as needing to account for every penny of an estimate dictates that agency solutions need to anticipate and plan for a more agile approach.
3. Own it
Creating a revenue stream and IP from a product, tool or service that also adds value to your clients is an ideal investment for creating a USP as well as adding to the bottom line. Smart agency owners have been developing these products for years. Done well, this creates a reason to be known for, a foot in the door with prospective clients as well as showcasing your expertise and hard-earned knowledge. In user journey terms this speaks to prospects whilst they are in the research or awareness phases, helping show that your agency is expert in a particular field and well-versed enough to be able to produce a useful product or tool. Examples might be anything from a piece of software, algorithm or website, to a specific conference or event, to a content piece such as a podcast series, video guides or book. The best products add value to your clients and their work, saving them time or money, ideally which you can demonstrate to them before you even begin working together.
4. Drop your barriers
So many effective partnerships can take place between agencies, consultants and clients, allowing each to bring their own specialisms and knowledge to the table. Often this works so much better than the typical traditional full-service agency and client relationship, especially in digital marketing, due to the wide range of disciplines and expertise required from each element. However, I sometimes see hesitation from traditional agency owners, in the feeling that they wish to keep the client relationship close and often feel threatened by an all-agency approach, or working with specialist freelancers or consultants. Of course, many third parties are happy to work 'white label', allowing you sole responsibility for the client relationship, but this can introduces complexities, not least in the client requiring direct access to the full team involved in their project. Where possible, we recommend opening up channels of communication between key players in the working group, as generally the positives outweigh the negatives. Some may be fearful of poaching issues, but this shouldn't be the case where good and transparent working relationships exist.
5. Create a real partnership
Leading on from the importance of a strong working relationship, nowhere is this more important than between the core agency and client. Solid working relationships here feel inclusive, collaborative and working towards shared goals and visions. Understanding of the critical path, key stakeholder relationships, results, budgets and timescales are all key. Too often clients can loose trust in an agency where they feel the agency looses focus on them as a client, where communication dries up or is inconsistent, or they are passed to more junior members of the team without discussion. When a client feels that they are only contacted by an agency when they need something, rather than for ongoing partnership reasons, they can loose confidence in and enthusiasm for the relationship. It is imperative that processes exist to continue to nurture the relationship to continue the partnership approach, rather than just agency and client, relationship.
6. Believe in your people
As an agency, your people are your biggest strength and asset. Include them in agency planning, share good and bad news with them, and involve them in elements of agency management where possible. Set a training budget per head and stick to it. Ensure those who manage others are in the right role and receive management or leadership training if they need it. Showcase their achievements and coach them where things could have gone better. Avoid blame culture and seek their feedback and support them where they need it. Not everyone is a salesperson; don't put unfair sales targets over peoples' heads and instead encourage them to focus on their own strengths. Put aside time for learning, sharing and collaborating. Support innovation and ideas and create judgement-free ways of sharing these. Give responsibility but with the right support behind it. Continue to grow your people along with the business and enjoy the journey!
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