What Separates Declining Agencies from Growing Ones?
While brands are spending record amounts on marketing – and 5% more than last year -- they’re not necessarily doing so through agencies, whose revenue growth averages 1.8%, or roughly the rate of inflation. That means your agency is nearly as likely to be declining as it is growing.
Here are tendencies of the former group...
as compared to the latter.
1) Forget to “love the ones you’re with.”
Get caught up in the allure of chasing new logos, forgetting the annuity effect of recurring fees, the opportunity to grow those fees “organically”, and the high cost of new customer acquisition.
As hard as it is to grow your agency through existing accounts, it’s harder to grow through new ones alone. Your clients know you, and you might be surprised how open they are to buying additional services.
2) Pursue anything and everything.
Regardless of the industry or the assignment. Declare that you specialize in everything… including oxymorons.
While some agencies can get away with being generalists by virtue of their size, stature, or location, most are better served by declaring a specialty, either by industry / category (e.g. retailers, travel, or B2B) or type of work performed. You don’t have to go “all in” in order to demonstrate focus and expertise. In college, you can double-major in something and take other courses, rather than graduating with a General Studies degree.
3) Pick up the phone…only when it rings.
Assume that agencies are few and far between, and there are high barriers to entry. After all, it’s not as if anyone with a cell phone and a laptop can call herself an agency. Clients have time to reach out to agencies because the only thing on their plates is marketing, not operational issues, volume forecasts, navigating organizational complexity, coaching their teams, and growing a business whose results are under more public scrutiny than your agency’s.
Whether you dial out literally or figuratively – via thought pieces, email marketing, speaking engagements, industry and personal networking – the more active your outbound marketing is, the more inbound opportunities you’ll get.
4) Pitch the wrong things.
Brands that sound sexy – to you and every other agency – but that will lose you money. Brands that carry a large fee – for you or any other agency – but aren't a good fit in other ways.
Pitch business that offers a blend of “sexy” and “sensible.” Sexy enough for your creative team to get excited about – or at least interested in – and sensible enough to pay the bills, like payroll. It’s also okay to alternate: For every sexy client, pursue a sensible one. Remember, though, that every client views his/her brand as some blend of the two.
5) Confuse possibility with probability.
“So, you’re telling me there’s a chance.” -Dumb & Dumber
Have you noticed that while a Cinderella story makes sports interesting, she seldom finds her prince? The recent NCAA basketball tourney featured all kinds of wild upsets – including the first-ever win by a #16-seed – and yet a #1-seed ended up winning it all in convincing fashion. While it’s true that you can’t win if you don’t play, just because you play, doesn’t mean you’ll win. If you’re one of a dozen agencies in a pitch, then pass. The likelihood of you winning is low enough such that what you spend in time, effort, agency morale, and money won’t pay out. Go find the opportunities where you’re a credible #1 seed – in other words, a legitimate final-four competitor. Those tournaments are out there, and you can win them.
6) Misinterpret “sweet nothings” as somethings.
Assume that because a search consultant says you could be selected, that you will be.
“Reverse interview” a search consultant – or client – to get an early read on the strength of your candidacy. You can do it in a way that doesn’t convey “Why the heck would you call us?” Done right, not only will it not be perceived as under-confidence, but the opposite: that you’re selective in what you pursue. Search consultants – like retained executive recruiters – aim to find the best agency for a client, but are paid regardless of who the winner is, which means it costs them nothing to be positive up-front. Nearly every search starts with a long-list, comprised of contenders and pretenders (who are there mainly to round out the slate). Intuit which one you are.
7) Be in the wrong place…
You’re located in Albuquerque, and the client is in New England. You’re in New York City, and the client is in flyover country and renowned for its deep understanding of its consumers, including rural ones.
Geography oftentimes matters. In only the odd case, when a client seeks to hire what they perceive to be best-of-breed, will they travel far out of their way to get it, when other, viable options are available in their region, if not right in their backyard.
8) ...at the wrong time.
Use trade magazines as a primary source of leads, and assume “hot tips” are anything but cold.
If you’re reading about a pitch in the trades, then it’s already too late. Oftentimes by three months or more. That’s when the decision to switch agencies was made, the long-list of potential agencies formed, and sometimes a search consultant hired.
9) Make a "mess" of your agency messaging.
Rather than speak in plain English about what it is your agency does and how it can help a client grow their topline, use industry jargon like Big Data, experiential, storytelling. Send many messages, hoping one will stick. Rather than throw one thing at your audience and have them catch it, throw many, and have them catch none.
It can help to have a “thing.” Whether you call it a vision, mission, mantra, strategy, tag line, or ethos doesn’t really matter. A thing is a hook that forms a through-line from your web site, to pitch decks, to case studies. The thing should be about what you do for clients, rather than about your agency. Bonus points if it’s about their clients: consumers. Note the use of the singular rather than the plural. Lead with one message, then expand on it. Each of these principles applies to marketing communications – the very role you’re auditioning for. If you make a hash of your own communications, you’ve signaled to the client what you’d do to theirs if given the chance.
10) Be unable to summarize why you’re the right fit.
Assume that even though you can’t articulate why the client should choose you, they will.
Playing the role of the lead client (CMO), mock up an email to your boss, the CEO, and send it to yourself: “Jill, my team and I recommend that we choose [insert your agency name here ________] because they, unlike the many others we looked at, offer the right combination of a,b, and c.” It will, nearly always, be a combination of hard criteria (geography, agency size, category expertise) and soft (agency personnel, chemistry, strength of the creative and strategy, demonstrated knowledge and passion for their business). If your rationale isn’t terribly compelling – or is all “soft” – then you’re probably a long-shot. Seek out clients where your odds are better.
Michael Hunter runs Parallel-49, a business growth consultancy that has advised Lowe’s, Panasonic, GE, and agencies BBDO and Landor. A former marketing executive at Best Buy, KitchenAid, and Campbell Soup -- and CMO and Chief Growth Officer for agencies -- he currently works as a consultant and fractional CMO.