Addressing the challenges of modern agency growth
An interview with Robin Bonn, founder of agency management consultancy Co:definery and Marketing Week columnist, on the challenges of modern agency growth
1. What growth challenges do you see most effecting creative business in today’s market? What’s the impact of these and are they different from 2 years ago and if so why?
It’s interesting - everyone knows the challenges but only the more forward-thinking agencies are changing.
Clearly many agencies are converging - and consolidating - around customer experience. Management consultants are buying agencies and agencies are launching consultancies. Everyone says similar things and competes with everyone else. Then there’s in-housing and the general climate of uncertainty.
None of this is new in the last two years, but the need to change is getting more acute. As the market evolves, the more dated your offer, the harder it is to catch-up.
For example, many agencies’ chronic underinvestment in their brands, offers and route to market has left them lagging behind changes to how clients buy. Remarkably, “got any pitches coming up?” is still a common growth ‘strategy’.
So the biggest growth challenge is inertia - often powered by a complacent reflex to claim that some abstract reference to ‘creativity’ is enough to standout.
Incoming IPA President Nigel Vaz’s focus on ‘reimagining’ the agency business model is very timely - as a wake-up call to mainstream shops and a yardstick for those who are already evolving.
2. What are the three most common mistakes that agency owners and leaders make when it comes to their growth strategy?
Confusing positioning with proposition. It’s easy to conflate these. You’ll end up with a meaningless made-up discipline or a bland re-articulation of what you and your competitors all do.
A good positioning signposts your proposition, which in turn states the problem you solve for a discrete audience. Accountant is a positioning statement, but helping SMEs get the right tax credits is a proposition.
Another common mistake is to confuse aspiration with strategy. Aiming to double in size is a metric not a strategy. I see your proposition as a succinct expression of your strategy - and definitely not as a changeable piece of packaging.
Finally, agencies often confuse pitching with growth. If your growth has come from winning new clients and you do that mainly by pitching, then it’s tempting to equate one with the other.
But even if you acknowledge your bias towards what you know, it’s still easy to forget that there are far more effective - and less commoditising - routes to market and margin.
3. What are the biggest impacts and benefits you see when agencies nail their proposition, outside the obvious one of higher turnover and hopefully profit?
A big one is improving team morale and engagement. In an agency without a strong proposition, ask a mid-level person why they stay and chances are you’ll get a diplomatic answer - nice boss, good perks, decent clients etc.
But once your proposition is nailed, that reply becomes far more passionate - “are you kidding? Why would I leave? Clients love us, my opinion matters, I’m fascinated by what we do”... it’s pretty chalk and cheese.
Secondly, embedding a strong proposition highlights the joy of focus. From simple stuff like not flailing around for the latest version of your creds (“who’s got ‘Final Version V9’?”), focus really smooths-out the emotional rollercoaster of leadership.
With conviction in the destination, CEOs have a far deeper reservoir of confidence with which to handle the daily ups and downs. Life becomes far less knackering.
Lastly, a great proposition also impacts the long-term. Offering deep expertise to a specific audience is the best way to secure your future - whether that’s international growth, a decent exit or just breaking the classic 15% profit glass ceiling.
Doing fewer things well is a very good rule of thumb.
4. Has there been a particular key learning point for you when it comes to working with clients to solve their growth challenges?
Not long after I launched Co:definery, I was midway through a consulting sprint with an agency CEO. He asked me what I thought so far. I replied directly but diplomatically. He cut-in and asked me not to sugarcoat it. So I started again, but he cut-in again; telling me (in a nice-ish way) to cut the BS and tell him what I really effin’ thought.
So I gave him both barrels. And that was exactly what he wanted.
Although ‘give it to me straight’ is hardly an odd request (albeit usually with fewer F-bombs), this was a penny-drop moment - for me as a consultant and for him as a CEO who was ready to hear difficult truths alongside the validation and fresh ideas that an external view should provide.
CEOs and founders are often too close to the problem. Like writers who find it hard to ‘kill their darlings’, it’s tricky to judge anything you’ve poured your heart into.
So as well as needing to change, you have to be ready. No wonder a good consultant can deliver more change in a few days than he/she could in six months as an employee or CEO.
5. What are the three best pieces of advice you can give to agency owners and leaders in support of successfully growing their business in today’s climate?
Build trust through substance over style. A compelling pitch isn’t enough, so invest in your agency’s entire customer experience. Clients build trust through what you do as much as what you say.
Make the brief, don’t take the brief. Think less about your discipline and fall in love with the problem you solve instead. That helps you rely on pitching; to get upstream and define the challenge. And if the right answer isn’t what you’re great off, then back off.
To the point about backing off, always be ready to walk away. Agencies love to tell themselves that they’re good at saying no to clients. But beyond declining an obvious hospital pass brief, few foster an ongoing sense of jeopardy in the client’s mind that the agency could walk away at any moment.
So think about how scarcity of expertise can make clients need you more than you need them. And bin the pathological optimism that makes you think you can do anything - you can’t and it damages your credibility.
If you’d like advice undergoing a change drop me a line to find out the many ways in which I can help you today.