5 Mistakes Growing Agencies Make
Change is a constant in our industry. You probably struggle to remember a time when you weren’t hearing about the “next big thing” or “why you must pivot now.” Today is no different — thought leaders, experts and journalists across the industry agree the best way to grow your agency is through building more strategic client relationships with clients.
But as the playing field changes, it’s easy to make some of the same old mistakes of the past. These are 5 missteps to watch out for as you organically grow your agency business.
Keep An Eye On The Project Pipeline
If you’re lucky, it’s possible you’ve been able to rely on AOR relationships to help you project revenue and better predict what the project pipeline will look like throughout the year. Clients aren’t looking for AOR relationships, however, these days. Why be locked into something with such a varied marketplace of niche players and varying prices?
Agencies, especially mid-size and smaller shops, are more and more reliant on a project-to-project existence. By introducing strategic exploration at the outset of the relationship or project, create trust and open yourself up to opportunities for future work. After all, the AOR is nothing more than a predictable pipeline of consistent and correlated projects. When agencies engage clients in project one-offs, no one wins. It’s impossible to track and transform meaningful data from a one-off project into deep, actionable insight. The kind of ongoing analytics it takes to ensure what’s working and what’s not to determine next steps. Sell your work and justify your agency’s value with this perspective so you can plan for growth.
Manage The Client’s Expectations
It’s always better to under promise and over deliver. It’s tough in the pursuit of new business to avoid promising the moon — even though for some it’s the joy of the job. If you’re approaching your client’s business with care, setting clear metrics and goals for your work, you’ll be able to maintain a more even keel and hit a more precise target.
“When that trust is lost, you usually can’t get it back. Work to make your statements of work much richer. Set proper expectations. Meeting expectations means you will get more work in the future.” — Haley McBride, Star Conspiracy via Digital Agency Day.
Don’t Hire Too Many People
As new business gets signed, it’s easy to make the mistake of hiring more people than needed to get the work done. In order to maintain healthy margins on projects that allow you to organically grow the business its important to understand what resources are absolutely necessary to doing the job. Not that you want to overwork your team, but you do want to make sure your current resources will actually be fully utilized before making any new hires. If you realize you have made this mistake, and you have underutilized staff with buckets of unused hours, you will have to take action and slim back down. Stay lean and stay busy. Run reports, check utilization rates, do your homework and don’t hire just because it feels like the need’s there (or even worse…coming).
Don’t Isolate Your Team From The Bottomline
Traditionally, senior leadership tries to keep their team out of the day-to-day financial weeds that they’re in, and in return, Creatives and Client Service teams are happy to be shielded from it. But there’s a happy medium available. And transparency can actually work in your favor. When working with clients as a strategic partner, provide them and your team with tools that share real-time data on the health of the account and current projects. This helps determine which projects to execute next, what to stop doing and lets your team better manage the opportunities they have to sell more work. Meanwhile, you’ll make your client-facing teams more accountable for the future growth of the agency. Furthermore, you should set up an incentive model for your client-facing team (read more about that in the ebook below).
Don’t Leave Sales To The Salespeople
Everyone within your agency should be accountable for ideating and capitalizing on client opportunities, especially Client Services. Making your Client Services team a strategic asset intuitively transforms your Client Services team into a strategic sales asset. Selling isn’t annoying when you’re working to solve specific problems and your work is connected to a larger strategy. Also, it allows them to set personal goals for themselves and better showcase their value to the team.
“A culture should be developed and nurtured so that every person in the agency feels both empowered and responsible for the success of the agency.” — John Heenan, Agency Growth Consultant
At Rova, we’re pro-strategy and pro-agency. We’re constantly telling agencies it’s easier than they think to make the transformation into a “modern agency” — which we define as a strategic partner or taking components of the consultancy-model to increase client satisfaction and success. And of course, seemingly endless opportunities for your agency to grow.
“You have to be able to look at your business from every angle and understand what makes your business unique. Identifying what you do best will help you focus on creating a system and infrastructure that can support scalability.” — Solomon Thimothy, CEO of OneIMS via Forbes
To read more about how to implement strategy, form more strategic relationships with clients, and grow your agency — download the ebook!