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Agency Leadership – 10 Lessons from 25 years Experience

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Agency leadership in challenging times

Thankfully we appear to have light at the end of the tunnel with regards to controlling the spread of COVID-19 here in the UK. The last 12 months have been a battle for all of us on so many levels. Running any type of business has been a huge challenge. Agencies have struggled, but unlike people in hospitality, at least we’ve been able to trade during the lockdowns (albeit in very challenging circumstances). The impact of Coronavirus has tested our agency leadership abilities to their limits.

Throughout the pandemic I’ve seen so many examples of agency owners stepping up and leading their business through the dark times. Not all have succeeded of course, but I know plenty of agencies that have not only survived but thrived. Regardless of their performance, all agency leaders have my admiration for the way they’ve stepped up.

Sadly, the tough times are not over. As yesterday’s budget illustrated, the post COVID-19 economy will take years to repair. It’s not politicians that will do this of course, it’s business people and their staff that will fuel the recovery. Many skills will be required to make it happen, but leadership will be paramount in getting agencies, and the country as a whole, back on its feet.

Agencies need leading more (not less)

Despite their increasing utilisation of technology, agencies are people businesses. The business model relies on the talent of its staff. The expertise and ability of its people is vital to the success of any agency.

Regardless of how talented they are individually, all successful groups of people need great leadership. Lack of effective leadership is one of the major reasons why agencies fail to achieve their potential.

Some people would have you believe that modern business with its digital technology, flat organisation structures, agile methodologies and the attitudes of the younger workforce, means that leadership is not as important as it once was. I fundamentally disagree. Leadership remains a critical success factor for any organisation. It will be paramount in surviving and thriving commercially in the years to come.

 

Leadership can be learned

Leadership is not for everyone of course. Many believe leaders are born not made. I certainly think that it helps if you have a natural aptitude and desire for leadership, but leadership skills can be developed over time if the desire and need exists. 

Some agency owners find they reach a ceiling when their business grows to a certain level. They started their agency for different reasons than to lead a group of people. Many never aspired to be the leader of an organisation at all. Success has forced them into that position.

Whilst natural talent is important, leadership skills can be learned. Expensive courses are not necessarily required for this to happen either. Experience counts for a lot, but I always think the catalyst for great leadership is self-awareness.

If you understand and appreciate your own strengths and weaknesses you can improve, compensate and utilise other people to support you in leading a business. Developing self-awareness as a leader will strengthen not only your individual performance but your agency performance as well. Self-awareness is a journey that doesn’t have a finish line. It’s an ongoing process of learning and adapting.

Top 10 Agency Leadership Lessons

In my 25 years of working in and leading agencies, I’ve certainly become more self-aware. I’ve also learnt a few things about leadership over the years (mostly from observing other people and their leadership qualities). I’ve taken my leadership lessons from all sorts of sources both inside and outside of agencies. I’ve even looked to people like Sir Alex Ferguson, who, as an ardent Manchester City fan I struggle to like, but can’t help but admire.

I’ve excelled at some aspects of leadership (and struggled with others). In a time when effective leadership is more important than ever, I’ve listed my Top 10 leadership lessons below. They’re in no particular order of importance, but they’re ALL important:

1 – BE CONSISTENT – Agency leaders are bright people who are full of ideas. This can mean they’re often flying around in all different directions. Unfortunately, this can lead to inconsistent working and decision-making. Consistency builds trust and trust in any leader is vital. Develop what I call a leadership rhythm. Weekly and monthly habits where your people can expect to hear, see or interact with you.

2 – REMAIN FOCUSED – Working “on” the business is important, but there’s a fine balance here. Don’t get bogged down in the detail, but don’t expect what you don’t inspect. Make it your business to periodically look under the bonnet of the agency to make sure you like what you see.

3 – RETAIN OWNERSHIP – The people that own the client relationships own the agency. Delegation and empowerment of the team are vital (as are contractual agreements), but don’t remove yourself too far from the client base that you become invisible. You never know when you might need to step back in.

4 – STAY ACCESSIBLE – Don’t distance yourself from your people. Even if you have an effective management team, don’t build barriers between yourself and the people in the agency. “Come to me with solutions not problems” is an overused phrase in my opinion. The day that people stop coming to you with their problems is the day you’re no longer an effective leader.

5 – COMMUNICATE (LIVE) – Always communicate in person whenever you can. Don’t hide behind email, Zoom or Slack. Technology cannot beat getting the agency all together in a room and speaking to them (when that’s possible of course). Do this regularly, even if it’s not in your comfort zone or something you enjoy.

6 – INSPIRE DON’T CLONE – Diversity in all its forms is a wonderful thing. Be clear on what attributes and personalities work best in your agency, but don’t try and recruit everybody in your own image. The values need to be more or less aligned, but not everybody needs to be the same type of personality. You’re amazing, but your way is not the ONLY way. Inspire don’t dictate the agenda.

7 – RESIST COMPLEXITY – Great leaders are great simplifiers. Your team will get frustrated with the added complexity of constant shifts in direction. They’ll thank you for making their lives simpler and easier.

8 – EMBRACE CHANGE – As your agency grows your leadership style must grow with it. Some tried and trusted methods and approaches must remain, but you must adapt. As your agency gets bigger and more complex, you can’t lead it in the same way you did when there was a handful of you sat around a few desks. 

9 – EXPECT LONELINESS – The responsibility of leadership is often hard to bear and a lonely occupation. Try and surround yourself with trusted partners or advisors to help share the burden and allow you to discuss your ideas and vent your frustrations in a safe space away from the wider team.

10 – ENJOY YOURSELF – Have fun. Don’t always try and run at breakneck speed or take it too seriously. Don’t always be chasing the next client or looking to the future. Relish what you have and enjoy the people and business you have around you.

What have you learned about agency leadership?

So there you have it, my Top 10 agency leadership lessons. It’s not an exhaustive list and I’m sure I’ll have missed some important factors.

If you can think of any glaring omissions, let me know at gareth.healey@beyond-noise.com. I’d love to hear about them.

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Gareth Healey
Gareth is the founder of Beyond Noise. He has 25 years experience in the agency sector. A business coach and mentor, he works exclusively with ambitious owner-directors of established independent marketing agencies.
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Agency Coaching – making and breaking habits

Agency coach Gareth Healey uses his experience running agencies to good effect with his agency coaching

Running habits...

Through the wonders of modern technology, I’ve been able to deliver my agency coaching throughout the recent lockdowns. In fact I’m pleased to say I’ve been busier than ever. 

When I’ve not been on the end of a Zoom call, I’ve tried to do my best to keep up with some form of exercise.  My local gym has been closed of course,  so this digital agency coach has become something of a runner.

I can’t say I like running. Those that know me well will know that I’m not exactly built for it. I do however, like the buzz and satisfaction you get after a run. I also appreciate the opportunity it gives me to clear my mind and focus on something very simple; just putting one foot in front of the other. I guess I’m not alone in gaining satisfaction from either of these things, but one aspect of my running does appear to be a little unusual. I like to run the same route every time I go out. 

My determination to stick to the same routine surprises and infuriates every other runner I know. My wife for one is incredulous that I don’t want more variety in my running repertoire. “I just don’t know how you run the same route day in day out!”, she says. Maybe it’s because I’m a creature of habit? Maybe it’s because I’m too focussed on just getting it over with?  

Whatever the reason, I’m guessing you’re asking yourself what this has to do with digital agency coaching and running agencies? Well, read on, I’ll try and pick up the pace a little.

Good habits...

As a digital agency coach, the people I work with people are not only marketing experts, they’re also entrepreneurs. There are many positive qualities of being an entrepreneur, but one thing that can hold them back is an over active mind. Like most business owners, agency founders are often excited and stimulated by new ideas and new thinking. This is drives them to take risks and innovate. It’s crucial to success. But this mindset also comes with drawbacks. I’m often forced to confront my clients with the fact that being a “magpie” and always looking for shiny new things, is not the key to running a successful digital agency.

The key to running a successful agency is not constantly coming up with new things and changing direction. It’s having a plan and executing it consistently. Setting a running route and putting in the miles day after day if you like. Running a set route keeps you on the right path. It keeps you focused and stops you getting distracted. Equally importantly, is putting in the miles day after day. It’s habit forming and brings consistency. It enables you to constantly learn and improve on what you do (and how you do it). 

Not everybody welcomes this news, but as James Clear puts it in his excellent book Atomic Habits, “The greatest threat to success is not failure…but boredom”.

Breaking habits...

A key part of my agency coaching then is helping my clients establish clear goals, plan a route and, crucially, help them to stay focused and on track. My task is to help them avoid the stresses and distractions of the day-to-day agency obstacle course and keep them focused on grinding out those daily miles and improving their technique and performance. 

Is this the end of the running cliches then? I’m afraid not. 

You see my lockdown running experience has taught me something new. Its taught me that developing good habits is important. Its taught me that having a goal and a route to achieve it is vital. But its also taught me that occasionally you need to break things up a little. You have to avoid stagnation.

During my running I’ve noticed that as happy as I am to run the same route day after day, after a period of time, rather than become easier, it starts to get harder. The daily route seems longer. The hills seem a little steeper than usual. 

I’m not sure what causes this, but I do know how to stop it. Whenever I start to feel like my running is becoming difficult, I make a change. Even running the same route the opposite way around a couple of times, helps to break the cycle and reinvigorate my tired muscles (and mind). I get even greater results from running a slightly different route and pushing myself a little further or higher. 

In short, I’ve learned that change is as good as a rest. After making a change, when you then get back on the tried and trusted path you feel stronger, both mentally and physically. 

Agency Coaching

Unfortunately, its not always possible to spot when you need to make a change. When you’re running for exercise its easy to spot when you’re feeling fatigued. When you’re running an agency, it’s not always as easy to identify when you’re stuck in a rut or have reached a plateau. Sometimes you need some help to spot the symptoms. Sometimes you need some encouragement to make that change. That’s where my agency coaching comes in.

My primary role is still to enable my clients to focus on an objective, develop a strategy and keep them accountable for delivering to a plan. This won’t change, even if it means encouraging and pushing them to do some of the dull and boring stuff exceptionally well week in week out.

My secondary role is to challenge them when the time is right. To not allow fatigue to set in and to help them switch gears now and again.

When people ask me what I do I usually say “agency coaching”. But you could say that I’m in the business of making – and breaking – habits for people that run agencies.

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Gareth Healey
Gareth is the founder of Beyond Noise. He has 25 years experience in the agency sector. A business coach and mentor, he works exclusively with ambitious owner-directors of established independent marketing agencies.
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What makes an effective agency NXD?

What is an agency NXD?

Agency NXD, Non-Executive Director, Non-Exec, NED. Whatever terminology they use, many agencies are now utilising the skills of an experienced person who is not directly involved in the running of the business but supports the directors in its development.

NXDs are not the sole preserve of the agency sector of course, far from it. The role of an NXD originated and is widely used in larger companies and in particular PLCs across sectors. Indeed, an independent director who oversees the executives’ management of the company is a key requirement for many organisations whose shares are publicly traded.

Historically, these NXDs were very experienced retired or semi-retired former executives. Increasingly, NXDs are now younger and either employed as an executive at another company, running their own business or even operating as a portfolio NXD.

There are many benefits to having an NXD. They are particularly highly prized in larger companies. Stakeholders can take comfort in the fact that there is one, or often several, NXDs monitoring and challenging the activity of the executive team. As NXDs are not full-time they are comparatively cheaper and can act as a sounding board for directors and a safety net for non-director shareholders.

The role of an NXD

The role of an NXD is to hold the executives to account for the delivery of the business objectives.

NXDs are focused on 2 areas; governance and growth. Whilst good governance is crucial to any organisation. In a smaller business, and in most independent agencies, it is the pursuit of growth that usually takes precedence.

Running any business can be exhilarating, fulfilling, challenging and frustrating. When you’re running an agency you can experience all these emotions in a single afternoon! 

Its a cliche of course but it can be lonely at the top of an organisation. As an agency principal, even if you’re not a sole director, it can feel like you have nobody to turn to for advice or counsel. Balancing the demands of your clients and your people can seem like an impossible task.

Having a supportive agency NXD who understands your challenges and has walked in your shoes can be of great asset to your business.

It is appreciated that NXDs cannot give the same continuous attention to the business of the agency. However, it is important that they show the same commitment to its success as their executive colleagues. 

The characteristics of a good NXD

NXDs are usually selected for their personal qualities, experience and specialist knowledge. Its vital that they not only possess wisdom, but are familiar with current trends and developments.

Some of the key characteristics of good NXDs are:

– Independence – it’s crucial an NXD has a strong relationship with their exec colleagues but retaining a level of independence is key. It not only provides objective scrutiny but enables the NXD to maintain a “helicopter view”. They must not get too close to the business so that they can’t see the bigger picture. This is usually why the directors need an NXD in the first place.

– Challenging but supportive – the NXD must be able to probe and challenge without creating conflict. They need to be constructive and diplomatic so they can ask difficult questions whilst offering support and guidance on problematic issues.  Mutual trust is vital.

– Courage and integrity – NXDs must have strong principles and the courage to stand up and say if they feel something is wrong or risky. Despite being engaged by the business, they require the courage to disagree.

· Great communication skills – they must be able to communicate complex ideas clearly and without being dictatorial. They should command respect but listen and absorb information as much as they talk and have input.

– Deep understanding of the business – whether they have industry experience or not, they need to quickly understand the products/services, the culture, the management team and the customer base. 

– Breadth of experience – we are faced with more operational issues than ever before. Reputation management, health and safety, ethics, social responsibility, risk and technology are all vital areas to observe when running a business. Companies need NXDs with specific knowledge and experience to frame discussions around these areas.


My own experience

We had a total of 6 people who operated as our agency NXD over the 15 years I was running my agency.  A number of our NXDs had agency experience, others had very little agency knowledge at all. At the time, this was a conscious decision on our part. We wanted to work with people who had different perspectives. This included other agency experience but also client-side and similar businesses operating in different sectors.

Looking back, I consider the people with agency experience to have been more effective as they hit the ground running and needed less context around some of the issues we discussed.

We chose to work with one NXD at a time, but we could have appointed more than one person.  In hindsight, I think this would have further supported and accelerated our growth. That said, we were in a fortunate position. Not every agency has the ability to invest in one agency NXD, never mind two or more.

The benefits of an agency NXD

In addition to the benefits to the agency outlined above, one of the key things myself and my business partners wanted from an agency NXD was personal growth. We recognised that even if you are not the sole director, leading an agency can still be a lonely role. It can also be a hard position from which to achieve progress in personal development. You’re often fire-fighting and switching your attention between interacting with clients and staff. It can leave little time or outlet for you to develop your own skills.

I’m a believer that you can learn something every day from anybody, but even if you are working with incredible people as I was, there is a massive benefit to bringing in external knowledge, experience and opinion. It’s not just about expanding the gene pool though. You can get very comfortable and familiar with your business partners and work colleagues. Too comfortable. Challenging them and yourself to improve your performance in the agency can become harder as time goes on. 

When we sat down in a board meeting it was hard for us to challenge each other if certain actions hadn’t been completed. We usually knew what had taken priority instead and invariably we ourselves were in a similar situation.

With an NXD in attendance, we knew that they wouldn’t be aware or concerned by the reasons why certain objectives hadn’t been met. We all raised our game when it came to these meetings as we knew an external person was attending and we wanted to ensure we continued to make a good impression on them.

Thinking back to the non-execs we used, whilst they all brought different perspectives, support and additional knowledge to the table, the real benefit for us as directors of an agency was the added accountability they instilled in the business.

This was the real value I got out of working with an agency NXD.

Do you need an agency NXD?

If you’re agency owner considering working with an NXD, I would ask yourself 3 questions:

1. Why do I need an agency NXD?

2. What benefits do I want them to bring to the agency?

3. What sort of person do I want to work with?

The reality is nobody needs an agency NXD. They need somebody to help the problems they are facing.

I see a lot of agency owners considering agency NXDs as a new business channel. Independent directors can bring a larger network into your agency and this can, in theory, bring new client opportunities. In reality, I’ve never seen this really bear fruit. If this is the primary reason to appointing an agency NXD then I would think about the position again.

No matter what level of experience you have, there is always an opportunity to learn from others. Whilst an agency NXD is likely to have more experience than you, even if they don’t, they will definitely have different experiences than you. That said, it’s vital you think through and articulate what value you want them to bring to your business. How will you – and they – measure their success?

As with all recruitment, nobody really wants additional headcount. You want the value that a person can bring, not the role itself. Good chemistry is crucial though. You must connect and enjoy working with the agency NXD as much as you do the other members of the senior team.

Gareth Healey
Gareth is the founder of Beyond Noise. He has 25 years experience in the agency sector. A business coach and mentor, he works exclusively with ambitious owner-directors of established independent marketing agencies.

Interview with Gareth Healey

Agency Coach Gareth Healey standing

Robin Williams of Data Hive recently did an interview with Gareth Healey. Here are some of the highlights:

What point in your career led you to do what you do now?

I’ve been involved in agencies for nearly 25 years. For 15 years I was CEO and joint equity partner of my own £12.5M agency.  I successfully exited that business in 2017. It was a tough decision as it was a great agency and naturally a big part of my life. I guess the main reason was a desire for change and to experience something different. I thought at one stage I would leave the agency sector for good, but I’ve found my passion for agency life still burns too brightly. I’m now helping other agency owners grow their businesses. The variety of work, people and being able to have a direct impact on my clients all make my current role very fulfilling.

What do you love most about the digital agency industry?

I started my career in below-the-line Sales Promotion agencies (the term has largely disappeared, think Sales Activation or Shopper agencies). Whilst I’ve always acknowledged the importance of brand building, it was the ability to quickly influence sales through marketing that first got me excited. Digital agencies remind me of the earlier part of my career which, despite the absence of technology, was more measurable and focused on ROI than other marketing disciplines.

In your own business development, what’s been the game changer for your success?

In both my agency and consultancy career, I’d say that focus has been my game changer. For a time we had a niche focus in my agency and I would say it was the period when we were most successful. When I started my consultancy I left the target audience undefined. This was a mistake. As soon as I clarified that I wanted to work with agencies, the opportunities opened up. People want to work with you because of your specific experience and expertise. 

What technology or product could you not live without for your business?

The short answer is a mobile phone of course. In terms of software and tech, as a former agency owner used to having a 40+ design person studio at my disposal, it took me a while to come to terms with being out on my own. I’ve found Canva a great tool for easily creating simple pieces of design for blogs etc. It also gives me some perspective, as it reminds me of the challenges that some designers and small agencies face from this sort of DIY solution. 

With hindsight, is there anything you’d go back and do differently for you own business growth?

Hindsight is a wonderful thing. There’s many things I’d do differently. That said, I have few regrets. If you’re not making mistakes, you’re not trying hard enough.  One of the key things I would do more of us networking. I used to hate it but I’ve come to love it and its opened so many doors for me in my new venture.

So far, what’s been a highlight of your career?

The messages of support and gratitude I received when I exited my agency were quite overwhelming. I’m not somebody that likes to make a fuss, so I left the business in quite a low key way, but I’ll remember the kind words I received forever. Very humbling.

So far, what’s been a highlight of your career?

The messages of support and gratitude I received when I exited my agency were quite overwhelming. I’m not somebody that likes to make a fuss, so I left the business in quite a low key way, but I’ll remember the kind words I received forever. Very humbling.

What book are you reading at the moment, and why?

I’m not reading any books at the moment, I’m writing one(!) I love reading and learning from others, but there is an incredible power in writing to clarify and develop your own thoughts and ideas.   I learned this from a friend of mine, Daniel Priestley. He’s written 4 books. They’re all brilliant.

In your opinion, what needs to change most in the agency industry?

I think ambition needs to change. The game has changed. Most clients no longer need to engage agencies in the way that they used to. Those that do struggle to navigate their way through the vast options they have. I still see too many agencies thinking they can just take part. They need to have the ambition to be the best. It’s a very competitive sector and you need to have the desire to stand out and deliver for your clients. Winning new business is not good enough, you need to have the mindset that you’re going to create something so special, people will be queuing up to work with you.

Who do you look to in the industry as an example of someone who’s doing things right?

A friend of mine, David Gilroy, runs an agency in Bristol called Contagious. He helps law firms market their businesses. David and his team have great digital marketing expertise, but they also have massive credibility and expertise in the legal sector. A great example of how focus and a niche can give you the competitive edge.

What's the best piece of advice you could offer an agency starting out?

Don’t start an “agency”(!)  There are thousands of agencies in the UK. Start a business that has expertise that can solve the problems and grow the business of clients in a defined sector. If you want to call it an agency then fine, but it needs to be a solutions business. Think outputs not inputs.

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How to improve agency efficiency

How to improve agency efficiency

In this article, we’re going to look at how to improve agency efficiency with TIM WOODS. You would be forgiven for thinking TIM WOODS is a new member of the Beyond Noise team. Things are not always what they seem.

Every agency owner wants to increase the profitability of their business. The easiest way they think they can do this is to increase revenue.

Did I say easy? As we all know winning new business is the lifeblood of all agencies, but it’s far from easy and far from predictable. Improving profitability can be delivered not only through incremental business but improving your agency efficiency.

When my agency clients ask me how to improve agency efficiency, I introduce them to TIM WOODS. 

Sadly TIM WOODS is not a colleague of mine. Neither is he the good-looking guy pictured at the top of this article (that’s a stock image). TIM WOODS represents the 8 wastes of Lean.

Lean?

My own agency was a big operation. We employed 175 people across 2 offices. Although we grew it to that size, the business was established well before I was involved. We acquired the agency in a MBO in 2002. Despite being a creative agency, it was a business that thrived on process. It had to, as the volume of work my team produced in a year was quite staggering. The small number of errors that were made was equally impressive.

Having lots of processes in a business brings lots of benefits. However, it can also create some challenges (particularly where processes evolve, develop and are added over time).

My business was a successful agency and we ran a very effective and efficient operation. Nevertheless we were always thinking about how to improve agency efficiency.

We wanted to become more profitable of course, but we also wanted to be faster and more responsive for our clients> W wanted to make things simpler and easier for our people. In order to achieve this, we invested in deploying the principles of Lean.

Lean process thinking is a systematic approach to improving efficiency developed in the Japanese manufacturing industry. Lean is a huge topic in its own right. A key concept in Lean is the pursuit of reducing or removing waste – or Muda as the Japanese call it – in the process. 

Who is TIM WOODS then?

Lean is a large and multi-faceted subject. As a concept developed for the manufacturing industry, some of the principles and applications are not totally suited to marketing agencies.

However, I found the focus on identifying and removing waste in an organisation to be extremely useful when we were considering how to improve agency efficiency.

As you may have already gathered TIM WOODS is not a person but an acronym. TIM WOODS represents the 8 elements of waste:

Transportation, Inventory, Motion

Waiting, Over-Processing, Over-Production, Defects, Skills

When I utilised Lean in my own business, there were only 7 wastes, but the eighth  (Skills) has been added since. It’s a good one and particularly relevant for people based businesses like agencies.

 

How can TIM WOODS help agencies?

You might be forgiven for thinking waste is the preserve of manufacturing businesses or companies that work with raw materials, but waste has many forms.

Reducing waste in an agency improves efficiency. It increases the speed of delivery, productivity and profitability.

TIM WOODS helps to identify – often hidden – wastes in an agency and can be used as a principle to explore how to improve agency efficiency.

The biggest impact TIM WOODS has for me is how it can help to change our mindsets as agency owners.

When looking at how to improve agency efficiency, it’s common for agency people to want to add things. Additional reporting and adopting – more – software products are usually the first thing people think about.

The key to improving efficiency though is not to add, but to take things away. To reduce complexity not to add more layers. Complexity is the enemy of efficiency and wasted effort, resources, time etc all contribute to complexity.

Please don’t implement a new productivity app in your agency without first looking at the processes. Adding new software without looking at the process behind it may at best paper over the cracks, At worst it can add more complexity and added tasks to an already bloated system.  

Let’s have a look at what each waste means… 

 

Transportation

This refers to the unnecessary movement of materials or information. In an agency, this could mean transferring information between productivity software, databases and or documents.

Inventory

Most agencies don’t produce physical products. We do have inventory though in the form of tasks, projects, briefs etc. Work stuck in queues, inboxes or backlogs that are “in-progress” but not finished and delivered to the client can be considered as waste.

Motion

In a manufacturing business, this usually refers to the needless movement of people. This can apply in an agency setting (unnecessary travel to meetings for example), but it can also involve navigating numerous programs, databases and performing multiple clicks or actions to get to the desired result. Too much motion is bad for effiicency.

Waiting

Often a source of waste in an agency. Waiting for information to start or finish a task. Waiting for approval from other people in the agency or waiting for the client can be a huge source of inefficiency.

Over-Processing

Over-processing can be a result of too many processes in an agency. Often agencies accumulate processes over time. People may be doing things that are unnecessary because they are told: “that’s how it’s done here”. It might have been required once, but maybe not now?

Other forms or over-processing include producing elaborate and detailed reports when raw data would suffice, or producing numerous options or polishing creative work to a high standard (when simple concepts would be acceptable for now).

Over-Production

Producing work or completing tasks that the client either hasn’t requested or doesn’t value are often examples of where an agency can be creating over-production. On many occasions, this is unintentional or done in the mistaken belief that the client appreciates it.

Defects

Perhaps the biggest source of waste in most agencies. Amends, rework, iterations, revisions are all ways we use to rectify defects. They directly cost the agency both time and money as well as being a huge opportunity cost.

Skills

At some point, the 7 wastes of Lean became 8. Wasted talent is a vital one for agencies though. You may have people doing tasks or work that they are not suited to. Other people could be performing and producing for you to a much higher standard of quality or output in a different area, if only they were given the opportunity to do so.

Lean in…

You don’t have to be a certified Lean process Black Belt (yes that is a thing), to apply some of the principles of Lean. Just take a deep dive into your processes and ask questions. Lots of questions.

How can we do this simpler? Do we really need to do that at all? Why do you do it that way?

We talk a lot about code bloat in agencies. When you’re looking at how to improve agency efficiency, think about process bloat. How can you reduce waste and friction in the system to make your people, clients and accountant happier?

 

Gareth Healey
Gareth is the founder of Beyond Noise. He has 25 years experience in the agency sector. A business coach and mentor, he works exclusively with ambitious owner-directors of established independent marketing agencies.

How to become a niche agency – PART 6

Finish with WHY

This is the penultimate post in my series on how to find your agency niche. The last 3 articles have focussed on refining your target audience (WHO), communicating the value you deliver (WHAT) and using your approach to differentiate your offer (HOW). In this piece, I’m going to look at the core purpose or mission (your WHY).

These posts are as much about crafting an effective Value Proposition as they are about becoming a niche agency. Finding your agency niche is not a particularly effective growth strategy on its own. You must find your agency niche and communicate it effectively. That’s where the Value Proposition comes in.

People are often surprised at my approach to creating a Value Proposition. The likes of author Simon Sinek have popularised the opinion that you should start – not finish – with WHY. I understand this view of course. If you, as an agency owner, already have a clear purpose that clients will find engaging and motivating then, by all means, start your Value Proposition or pitch with your WHY. 

Unfortunately, I find that many agency owners don’t have such clarity of their purpose. Rather than starting with WHY, I find that crafting a Value Proposition in the order that I’ve described can be a more productive, and less frustrating, exercise. It also usually leads to a deeper understanding of what makes the agency and its owners tick. 

Why are we here?

If you’re an entrepreneur, then chances are you started in business for a number of reasons. That said, the primary objective for most is financial reward. To make a profit.

Whilst this is usually the core reason, people have different levels of ambition. Some want to make millions, others just want to make enough to support themselves and their families. In addition to income, many entrepreneurs want to build a business that has value. A value that at some point they can realise through a sale or exit.

There are other reasons for starting and running a business beyond the financial aspects of course. Doing something you love, being in control of your own destiny, greater flexibility or even simple necessity can all come into play. 

Many entrepreneurs start with an idea for a business or product that they believe is either new, revolutionary or has untapped potential. They have the drive to create something or to exploit specific market potential.

Whilst agency founders are no different from other business owners, I find the most common reason for agency founders to start an agency is control. To utilise and build on their skills in order to serve clients and create/deliver work that they can call their own. To be masters of their own destiny rather than work for an established agency.  To do what they love in the way that they want to do it.

Starting out

Establishing any business is challenging, but starting out in the marketing agency sector is easier than many industries. There are few barriers to entry to the agency market. Little capital investment is required. No formal qualifications are necessary. Agencies can be created quickly. In some cases, they can even evolve from a founder establishing themselves first as a freelancer(s). 

This ease of entry is a great thing, but it does leave me to reflect that many agency owners are not driven by a big vision. Their business goals are personal to them and not usually invested in creating a new product or re-shaping an industry. They have a desire to create great work and results for their clients of course. However, as these clients are usually ill-defined (see WHO), painting a vision for what long-term impact the agency wishes to achieve can be hard to do. Capturing such a vision in a way that delivers impact and meaning to prospects is usually even more challenging.

Whatever the reason(s), it’s vital for growth that an agency has a clear mission and compelling WHY. Whether it’s expressed at the start, middle or end, your WHY is the beating heart of an effective Value Proposition.

Why is this important?

Having a purpose or WHY you do what you do is incredibly important in business today Not that its a modern concept.  The 19th Century German philosopher Frederick Nietzsche said, ‘He who has a why can endure any how.’

Why you do what you do, and why it should matter to your clients, team and the wider world is more important than ever. It’s a vital part of attracting clients, recruiting and retaining staff. It’s integral to marketing, managing and developing a niche agency.

Your WHY is actually important to 3 groups of people:

1. Clients – I’ve spent a lot of time in this series emphasising that the focus of the Value Proposition is communicating the benefits of your niche agency offer to clients. Having a strong mission (WHY) gives clients a reason to believe. It creates an opportunity for clients to understand and start to develop an emotional connection with your business. Crucially it helps your agency stand out from the competition.

2. Colleagues – The main focus of a Value Proposition is to engage clients. There are, however, a group of very important people that you also need to keep engaged. Your team. Helping your people stay on track, motivated and loyal to your agency is increasingly difficult as competition for talent is intense. A strong WHY clearly communicated is vital in keeping your team engaged with your business. I find this is particularly powerful in a niche agency where some members of the team may not understand the importance of working in a niche. Your WHY is particularly important for employees who are Millenials. It is generally accepted that younger people need to feel connected to something beyond the company bottom line to make their best contributions. Millennials crave purposeful work i.e. they will work hard to make the agency profitable if they understand and engage with the purpose behind its work. This purpose must extend beyond the pursuit of profit.

3. You (the agency owner/leader) – Last but not least, your WHY must motivate you as an agency owner. As I noted earlier, starting an agency is relatively easy, but I know from personal experience that running an agency is tough. Having a clear purpose to guide you and influence your decision-making is as useful for you as the agency principal, as it is to your team.

How to find your WHY

The most effective WHY’s are born not created or manufactured.  In other words, the agency purpose is ideally borne out of the personal beliefs and vision of the agency owner(s).

Finding your WHY, therefore, demands quite a lot of reflection and maybe even some soul-searching. It should be influenced by the beliefs, values and aspirations of the agency owner(s).

How this plays out is, of course, itself influenced by the number of founders involved and the size and maturity of the agency. If its a relatively small or young agency with few shareholders then the WHY should naturally be heavily guided by the vision of the owner. If the agency is more mature and larger with an established culture, whilst the founder’s input remains a priority, the WHY might be shaped more by a wider group and take into account established culture and wider context.  

When I’m helping a niche agency client define their WHY, I encourage them to consider 4 areas… 

1. What do you/your agency enjoy doing? 

What energises the agency?

What drains it?

Does what excites your people, also excite your clients (and vice-versa)?

Why do people join your business?

Why do people stay?

Do you excel at innovation or change or do you enjoy predictability, order and delivering proven processes?

 

2. What are your core strengths?

What things do you always do? 

What do you rarely or never do?

Are you a creator/innovator or a builder/maintainer?  Does your agency like to make a difference in a short space of time or have a bigger impact over a longer period of time?

Do you make your money from your core strengths? If not, why not?

3. When are you at your best?

Where do you add your greatest value? N.B. You add the greatest value where you solve the greatest client problems.

What type of client personalities get you more enthused about what you’re doing than others? 

 

What is driving you to be the best (insert type of agency here) you can be?

Are you best at strategy and/or new ideas or do you excel at delivery, data or analytics?

4. How will you measure your impact?

What are you fighting for?

What does success look like for your agency? How will you know when you’ve achieved it?

What future are you trying to create (for your agency, clients and the wider world)?

How do you want to be remembered as an agency? What will be your legacy?

How does your agency contribute to the wider world?

What are you passionate about or frustrated by?

Bring it all together

Before integrating it into your Value Proposition, you should create a purpose statement to describe your WHY…

  • Most purpose statements start with “To”.
  • Choose words that suggest positive action.
  • Keep it short. Don’t overcomplicate it.

Does this statement resonate with you and your team? Does it make sense to existing clients? Will it engage new prospects and new people?

 

Summary

The pursuit of growth and a profitable agency is what keeps many of us coming in to work each day. But what is your big vision (beyond making money)? 

Your success is really measured by the impact you have on the world around you. This is WHY you exist and is certainly why many clients and most of your people want to work with you.

This is the final building block of a powerful Value Proposition and the key to exploiting an agency niche.

 

 

 

How to become a niche agency – PART 5

The importance of HOW

In my previous articles on becoming a niche agency, I firstly looked at refining WHO your target audience is. I then urged you to define WHAT value you deliver for them N.B. not what services you perform, the VALUE your audience actually receives from your services. Benefits not features.

In this piece, I’m going to look at the next stage in the agency Value Proposition. How you can differentiate your agency with HOW you work or interact with clients.

HOW you work is a key aspect of the Value Proposition for a niche agency.  That said, it’s slightly lower down the hierarchy of communication for me. In my experience, busy clients who are under pressure, rarely care too much about how you deliver for them as an agency. As long as you deliver for them.

I actually find it strange that many agencies promote HOW they do things as a priority, Talking about this seemingly ahead of lots of other more important aspects of their business. Moreover, they often choose to take this route rather than consider positioning themselves as a niche agency with a specific and definable target audience.

We’re different (but the same)

In an industry built to create and differentiate brands, marketing agencies are surprisingly poor at differentiating and marketing themselves. Rather than help us to stand out, the terms we use to describe our agencies are often strikingly similar. Many have become clichés.

Take a look at most independent agency websites and you’ll encounter familiar terms and recurring soundbites. Most of the descriptors are commonly preceded by we and/or we’re. Here’s some familiar examples:

We’re full-service – We do everything for you (even though they usually don’t, or quite possibly can’t). I find it amazing how this term can still be seen by some as a differentiator or motivating to prospective clients. Maybe the one-stop-shop agency was a compelling idea in the 1980’s, but we now have so much better access to information. We also have tools to help us communicate and manage the process better. In the 2020s I don’t believe clients are interested in an agency whose core proposition is everything under one roof.

We’re specialists/experts – This is usually followed by a number of claimed specialisms in usually inter-related but nevertheless independent disciplines. If you want to be a niche agency you must find a niche market and supply it with a specific service.

We’re Award-Winning – I value awards from a team motivation perspective. I also appreciate their ability to substantiate and add a degree of trust in the agency’s capabilities. Award ceremonies are so numerous though. Which agency doesn’t have a shelf full of plastic gongs to show off?

We’re a friendly bunch – I find that every agency claiming this is right. Agencies are filled with great people who by their very nature are friendly and easy to work with. Sadly it’s not a credible differentiating factor. Neither is the near-ubiquitous agency dog designed to convey furry friendliness. Rather than make an agency standout, a picture of the agency dog on the website has become almost “me too” and even has its own social media #agencydogs hashtag to emphasis its mass appeal.  My own dog is welcome in my office any day, just not on my website.

We’re honest/transparent – Trust in advertising and marketing agencies has declined in recent years. Media agencies, in particular, have been dogged (no pun intended) with transparency issues.  Unfortunately, trust has to be earned. Simply claiming honesty just seems to imply you have something to hide.

We’re results-focussed – Now we’re getting a little warmer here. The marketing industry on both client-side and within the agency sector are being held to account like never before. Results and metrics are paramount. Can you deliver the results though? Actions speak louder than words. Clients are far more interested in real case studies that demonstrate an ability to deliver, rather than overtures about what your agency focus is. Indeed, if you’re an agency that isn’t focussed on results you’ve got big problems.

We’re passionate – Telling somebody you’re passionate just doesn’t cut it (for them or you). Like trust, you have to really experience passion. Even if you can get a degree of energy and commitment across in your communications its at best only a hygiene factor for somebody considering working with you.

We’re different – Saying you’re different but then using the same language and images as loads of other agencies really doesn’t work either. If you’re genuinely different, don’t tell me; show me. Tell me HOW!

A Genuine Difference

Please don’t be offended by my cynicism in the list above.  We’ve all used at least some of these terms to describe our agencies (myself included).

I’m being particularly challenging to make a point of course. When describing HOW your niche agency works in your Value Proposition, the objective is to differentiate and stand out (not to fit in and be like those other agencies). Using the above terms is paradoxical.

That said, you don’t have to aim to be completely unique. The quest for uniqueness can be a frustrating process that often ends in a Value Proposition that is too contrived and hard to understand. 

What we’re looking for here is differences in the way you work or how you approach things in a slightly different way. In a sea of sameness, a slightly different take or, indeed, an explanation of HOW you produce your value for your niche audience can make all the difference.

The key though is to not only identify and communicate HOW you’re different. You must communicate HOW these differences benefit the client. Why does working with you – in your way – enhance the clients’ chances of getting better results? Why is your way better than the other agency the client might be considering working with?

How to find and utilise your HOW

Making HOW you operate an integral part of your Value Proposition is a great way to differentiate your agency. It’s also usually far easier to do if you are a niche agency.

By nature, HOW you operate can be personalised more if you have a defined niche audience. The benefits of your HOW can be more easily communicated and will be instantly more relevant to a niche group.

You may already be working in a way that is different from other agencies. Alternatively, you may have some ideas on how you can evolve how you work and use it to not only deliver your services but also engage clients prospects and help you stand out.

It’s important that you’re able to explain your HOW and the benefit to your clients. Simply saying that you’re great at client service and you really place a lot of emphasis on it, for example, is not enough. It’s not specific enough to how you work, it’s not differentiating, and it’s an easy claim to make but practically impossible to substantiate.

Here are some areas to explore to help you create a story around your HOW:

1. Brand your methodology – Have you got a specific process you go through when working on a project? Do you approach client problems in a particular way or with a unique perspective? Could this be explained in detail and be branded as a bespoke methodology? Remember to include what benefits the client(s) derive from working in your way. Always think you not we.

2. Embrace a methodology – You can work in a different way to other agencies but using methodology created elsewhere. There is a lot of talk within agencies about Agile at the moment. This is an example of how some agencies have adopted the way of working from software development and utilised it in a different environment. Agile and Scrum have become common buzzwords, but the core principles of deploying self-managed teams was something my own agency was doing 15 years ago. Have you seen a way of working elsewhere that could be adapted to suit your agency? Could it become a point of difference for you?

3. Values & Principles – Are your company values a graphic on the office wall or do your values REALLY dictate how you operate as a business?  Can you honestly say to clients that you have a specific value system and there must be a fit with this if you are to work together? People want to work with people whose values align to their own so this can be a powerful message and a key differentiator if there is a natural fit.

4. Try before you buy – Can your agency claim a particular commercial approach to doing business with a client?  For example, could your digital marketing agency conduct a localised trial of your proposed activity first to identify if the results that are required can be achieved?  If not, then maybe you could claim to not take on the work.

5. Expert / Personality – Does your business have a leader or senior figure in the business that is a recognised expert in your client niche?  Can you use this person to create a process around HOW you operate?  Can you elevate their profile to make them a focal point in HOW you work?

6. Onboarding – The start of any client relationship is crucial. How you onboard clients could be a point of differentiation.  How do you engage with them differently in those vital early stages of working together? How does this benefit you and what is the benefit to them?

7. Engagement – Onboarding a client is one thing, but what about your ongoing relationship?  Do you work with clients in a different way than other agencies? Do you have fixed-term contracts or set review periods? Do you embed a member(s) of the team in the client business for the duration of the project/contract?

8. Walled Gardens – Do you have research, knowledge, information or insight that clients would value but don’t have? Can you explain how you can give them access to this information only when they become a client? Can you offer clients training for their teams on specific aspects of your work together? Once again, this type of approach is far easier to establish if you’re a niche agency. You can capture your learnings and expertise from working with other clients and give new clients the benefit of it. This is much harder to achieve if you are trying to appeal to clients across a broad spectrum.

9. Pricing – Do you or can you price differently from other agencies. The industry is desperately trying to lose the shackles of the billable hour. Do you price your work on value delivered not on the time you spend? Do you work on some sort of revenue/profit share basis? Can you claim to have skin in the game and invest some of your own money in the project you are working on with a client?

10. Staffing – Do you staff your agency in a different way to your competitors? There must be a benefit to you of doing this, but is there also a tangible benefit to your clients? Can you express this benefit in a way that is interesting and motivating to prospective clients to want to learn more.

Summary

HOW you do what you do is an important component of the Value Proposition for any niche agency.

The way your agency works can be as distinctive as the work it produces and the results it delivers.

For many agencies HOW can be the real point of differentiation.

In my next article in this series, I’m going to look at the final building block of any Value Proposition. Some would argue it’s the most important, I certainly think its the one that can connect with your clients in the most emotional way; WHY you do what you do and what you believe in.

How to become a niche agency – PART 4

First WHO now WHAT

In my previous articles on how to become a niche agency, I outlined the benefits of a niche specialism. I also detailed what I look for in a Value Proposition. In my last piece, I explained how I start to guide the articulation of a Value Proposition. I encourage my clients to start with WHO they’re targeting. The next stage of the process is to consider WHAT you do or, more importantly, WHAT value you deliver to the people you’re targeting.

On the face of it, “what do you do?”, is a simple enough question. But I find many agency owners struggle to give a clear answer. Is this because of the industry we are in?  I reflected last time that so many agency owners seem to find it difficult to articulate WHY they exist. Surely explaining WHAT you do is easy enough? Once again we can’t be in a unique bubble here in agency land, can we?

WHAT do you do?

Explaining what you do as an agency is vital to engaging new prospects and winning new business. You must be able to communicate what you do quickly in easy to understand language. Its the essence of the fabled Elevator Pitch.

When I ask agency people WHAT their business does, I usually get one of the following responses:

1. SERVICES – A service or list of services centred on a marketing channel(s) e.g. we’re an SEO agency, we do social media, we’re a web agency etc.

2. LABELS – An industry label that we’ve become accustomed to using e.g. we’re a full-service agency, an integrated agency, a digital agency, a UX agency.

3. BUZZWORDS – Something convoluted containing lots of marketing-speak e.g. we’re a group of superheroes developing human-centred immersive experiences designed to disrupt and engage.

Whilst the responses are naturally different, a common occurrence is that they invariably start with the words We or We’re.  I think this points to a wider issue and something I touched upon in my last article.

People in agencies often view WHAT they do as WHAT they actually – physically – do. They create ads or design logos or produce social media campaigns. This is not wrong of course, but when I ask people what they do, I really want to know what value they deliver. What are the results of their endeavours? What do their clients’ actually pay them for? 

In short, I don’t want to know what features their agency has (they’re predominantly the same as every other agency), but what benefits they deliver. This is teh essence of an agency with a niche specialism.

WHAT can you do for me?

It’s an overused stereotype, but it’s often noted that we British tend to be more reserved than other nationalities. In general, we’re not as brash and self-promotional as people from the United States, for example, tend to be. We can view confidence as a negative quality and occasionally as even a bit vulgar. We can also be guilty of being too self-effacing or modest. These are not bad qualities, but when it comes to business it can mean our true intentions and the value we offer are hidden.  You don’t have to be from the United Kingdom to display these traits or behaviour of course, but either way, I think I think they can be limiting.

I’ve heard people say that American networking events are quite different from those held in the UK, particularly if you are in the commercial hubs of New York or LA.  I’m told it’s not unusual for somebody to approach you with the phrase “Hello, what can you do for me?”

Whether this is true or not,  I think we can learn something from this concept. If you’re operating a service business, your customers are rarely interested in the service itself. They’re interested in what the service can do for them.  How it can solve their problems or enhance their lives?  And it’s not just about the physical results. How does your service make your clients’ feel emotionally? What do you do for your clients as people as well as for the companies and brands they represent? What is the value you deliver?

At your service

Unless they have a productised aspect of their business, marketing agencies sell professional services. Just like accountants, lawyers, plumbers or hairdressers, agencies sell their skills, not products.

Increasingly, agencies are being viewed as more of a commoditised service, just like some of these other trades. Clients buy on price and availability. Relationships are becoming shorter and more transactional.

Unlike some of the other service-based businesses, agencies are not subject to any scrutiny or governance by professional bodies. Marketing agency staff don’t have to undertake any formal training or gain any professional qualifications in order to sell their services unlike, say the legal profession. Competition in the agency market is fierce and trust in the sector is at an all-time low.

Moreover, mirroring the attitude towards marketing in general, marketing agency services are often viewed as a cost rather than an investment. Something to be bought as cheaply as possible.

Part of the reason for this is that despite the prevalence of digital media, marketing activity as a whole remains difficult to measure and quantify as ROI.  The other reason is that marketing is often seen as less of a need and more of a desire. If you have a leaky pipe, you need a plumber and you need one now. If you run a company, you must legally file certain financial information that most people need an accountant to support them with. 

Not only the results but occasionally the objectives of marketing can be difficult to quantify.  Marketing itself is not a need. Sales are usually the objective, with marketing being simply one route to achieving them. The explosion in media channels and marketing techniques has also served to complicate matters even further. Whilst bringing us massive opportunities and additional – more measurable – options, the additional channels have also served to make the art of marketing more complex and harder to understand and appreciate.

What are you selling (and not selling)? 

If you’ve read some of my other posts, you’ll know I get frustrated with agencies that have a seemingly insatiable desire to promote themselves based upon the breadth and not the depth of expertise. 

Whether it’s working with clients from multiple unrelated sectors. Or agencies that claim to be able to deliver everything from high-level marketing strategy to volume delivery across all the media channels you’ve heard of (and some you haven’t). This lack of focus frustrates me and seriously impacts their ability to project the value and find resonance in the market.

A word of caution though. I’m an advocate of focus, but we live in a complex world. I prefer to push for what I call T-shaped breadth rather total niche specialism. You need to have deep expertise, but you must have an understanding and appreciation for how all the other pieces of the jigsaw fit together. This is crucial if you really want to maximise the value you deliver and work successfully with your clients and their business partners.

The first step to clarifying WHAT you do is to decide – and often refine – what you’re selling. What do you have real expertise in?  What area of your business offer is your real passion? This in itself can be a cathartic experience for some.  It makes them realise their true expertise. Sometimes, it makes them reevaluate their entire business.

It has been said that the essence of strategy is sacrifice. What don’t you do? What will you immediately say you can’t deliver? Again, whilst counter-intuitive to many, this concept can be quite refreshing if you embrace it.

Take a look at your revenue streams. Where does the bulk of your revenue come from?  You might claim to offer – say – social media marketing, but does it make up such a small part of your revenue that it’s not worth thinking about?

Think of it another way. What is usually your first brief from a client? Do they ask you to review their entire marketing and suggest a new strategy? Or do they ask you to quote them for a new website?

Maybe your first conversation with a client isn’t directly linked to marketing at all. Does the client talk to you about their business first?  Do they impress on you the urgent need for more sales or a desire to convert more visitors to their website or increase basket spend?

What value do you deliver?

If your value proposition describes exactly what you do or what you sell, you’ll find it hard to differentiate yourself.  If, on the other hand, it describes what the effect of what you do is, then this is where you can start to stand out in the market.

The benefits or effects of your work. The value you deliver. This is truly WHAT you do, for your clients expressed in a way that most interests them. Not lists of services they may or may not fully understand or desire. Actual goals they want to achieve.

Of course, this is not a simple process. The benefits a client can derive from your efforts can be tangible or intangible, rational or emotional, functional or aesthetic.  

The closer you can get to communicating WHAT you do and what value you deliver in a way that demonstrates tangible and rational benefits and resonates emotionally with your prospects the better. In short…

The Value you Deliver = (Tangible + Rational benefits) x Emotional resonance

The tangible and rational benefits are usually the way you benefit the clients’ company/brand. It can be beneficial if there are some numbers in there (or at least a financial focus). 

Tangible Benefits = Quantifiable things your work actually produces or achieves. More sales, more customers etc.

Rational Benefits = You might save them money or produce work faster or in a different way than your competitors.

The emotional element can be about the clients as people as well as their company of course. How does your work make them feel or help them to do their job? Be wary of being too generic here though. Making clients feel great because we’re a friendly bunch to work with is not differentiating or compelling enough.

Emotional Benefits = How you make your clients feel. Are they able to do their jobs better, safe in the knowledge you always deliver to deadlines? Or maybe you have more expertise than they do and they can trust you to help them get the results they need and get noticed in their role.

However, you express the value you deliver, retaining a focus on how WHAT you do benefits the client is obviously the key. These things can be expressed and communicated in so many different ways. What is important is that you retain a focus on the fact that it’s not about WHAT you do, it’s about the effect of WHAT you do does for them.

Summary

If you’ve been following this series on creating a niche specialism, you should be well on your way to creating a compelling Value Proposition. You’ve defined a market and have a clear focus on WHO your clients are. 

You should now be clearer on WHAT you actually do for your clients and what value you deliver to them. You should have more of an insight into what a difference you actually make to their lives and businesses. You should also have some ideas to communicate your value in a more clear and compelling way.

In Part 5 I’m going to be looking at HOW your agency operates, and how this can be used to differentiate yourself. If you have a picture of the office dog on your website, this next one may be for you.

If you don’t want to miss it, sign up for my email updates here.

How to become a niche agency – PART 3

WHO not WHY…

In my previous articles on how to become a niche agency, I outlined the benefits of a niche positioning. I also explained what I see as the differences between a Value Proposition and a Positioning Statement. Here in PART 3 of this series, I’m going to start to unpack my approach to building a Value Proposition so that you as an agency owner can apply these principles to your own agency (or any similar business for that matter). Firstly, and at risk of being controversial, I suggest you start with WHO you’re targeting!

I’m a long-term admirer of the speaker and author Simon Sinek. I’m naturally a big fan of his best selling book, Start with Why. I’ve spoken to many people who use this book as a reference point when looking at positioning. They first look for the WHY in their business proposition. They try to find, identify or clarify their purpose, cause or belief.

For some this makes sense. A compelling purpose or WHY is a powerful thing and forms an excellent foundation for creating a Value Proposition. For the majority of agency owners though, identifying a WHY is a difficult and frustrating exercise. In my experience, it often stalls the positioning process before it has really got started.

I think many often overlook the fact that Sinek’s book is fundamentally about leadership, not marketing.

Simon reminds us frequently that “People don’t buy WHAT you do, they buy WHY you do it”. I totally agree. If you’ve read my previous articles on positioning, you’ll know I get frustrated when I see agencies marketing themselves with WHAT they do (simply listing the services they provide). 

However, I believe it’s often particularly difficult for agency owners to identify their WHY. I also note that Sinek’s mantra “People don’t buy WHAT you do, they buy WHY you do it” in itself starts with People (the audience). The people who are your existing or prospective clients. 

My point is, if you’re not clear on your market then how can you effectively communicate with them? Moreover, how can you effectively build a business designed to serve them? That’s why I always recommend you start with WHO you’re targeting. WHO is your target audience?

Why is the WHY so hard for agencies?

Marketing agencies are not unique in finding a purpose or compelling WHY difficult to easily define.  However, as a sector, they do share some similar characteristics that make defining a WHY particularly challenging:

  1. Reason for starting – Agencies are often started by people who have worked in other agencies but decide they want to go out on their own. Their purpose is really just to work for themselves. This is a great thing, but it doesn’t translate well into a customer-facing value proposition.
  2. Reason for being – Agencies, particularly those with a more creative focus, are set up by people wanting to test their own skills, to create work that they themselves are proud of. To work on clients that they like or have an affinity with. Again, this is a perfectly valid reason for starting an agency, but it’s not an easy thing to translate into tangible a client benefit.
  3. Standing Out – In such a crowded market it is hard to stand out. Of course, this is exactly the reason we are considering positioning in the first place. But, with so many similar agencies with similar offers in the market creating a distinct message supported by a unique mission is difficult. 
  4. Intangible Assets – As service businesses, agencies naturally don’t have a product to guide or help them crystallise their WHY. For example, they can’t point to wanting to produce the finest quality, ethically farmed meat. Or they can’t claim to be driven to produce cosmetics that don’t contain any harmful chemicals and are kinder on people’s skin.
  5. Client motivations – A client may use an agency for a number of different reasons. Frequently the defining success factor of the relationship is more sales for the client. This works well as a shared goal, but I’ve never come across a situation where the agency has to encourage the client to embrace the concept of selling more. Its a very valid purpose, but one which doesn’t feel particularly differentiating and is perhaps a little too obvious.

I’m not suggesting that the WHY should be ignored, far from it. I’m just advocating a more pragmatic approach.

Start with WHO

I’ve worked in the industry for nearly 25 years. With the possible exception of those 15th round of client amends moments, I’ve seen few things cause more frustration or the rolling of eyes than strategic client briefs that fail to mention the target audience.

“How can they possibly expect us to create great marketing communications for them if they’re not explicit about who they’re targeting?” would be the cry. 

It’s the very first thing we looked for in the brief. If it wasn’t clear or focussed enough, it was the very first thing we fed back to the client. Have you ever taken a strategic client brief and not asked them who their target audience is?

Eat what you cook

As agencies, we often fail to heed our own advice. We spend hardly any time dissecting our target audiences. We rarely question the need to become more focused. We seem to find a positioning “for everybody” perfectly acceptable and often desirable.

Defining who your agency is for is important. Defining who your agency is NOT for is equally important.  The exercise of positioning your agency in a niche is not about appealing to more clients. It’s actually about attracting fewer clients, but making a stronger connection with them. Being more relevant to them and their needs.   

Its also about differentiating yourself. Positioning yourself as an expert in the minds of your target audience. Clearly communicating you are “for them”, already sets you apart from the thousands of other agencies offering similar services but in a less targeted way. You can connect more easily with a smaller audience and when you have a connection with somebody it’s far easier to sell to them.

My advice is to treat yourself as your own client. Take your agency through the same process you would if you were talking to a client about positioning strategy.  Start by segmenting your market. Ask yourself who your target audience is. Encourage your colleagues to get as tight as possible to the target market. A niche is not your entire market, try and find your niche.  Build some audience personas to test your approach and help you and the team become familiar with the target audience

Take charge of your own destiny

As I’ve said, defining a target market is challenging for most agency owners. Many of you will already be working with a wide spread of clients. Either you or your team may crave the variety of work that this in theory at least, provides. Some of you may be worried that niching or focussing on a more tightly defined target market will present problems such as conflict of interest. Some of you may be unwilling or afraid to change.

Having run my own agency and worked with many others, I can empathise with these points of view. I believe passionately though that niching your offer and – at the very least – marketing your agency to a more specific target market is the way to grow a profitable independent agency in the current market.

If you’re still not convinced, maybe this thought will tip the balance. I’ve met 2 agency owners this year that, in slightly different words, lamented that they “don’t get to choose who we work with” i.e. they regularly attracted and won new business, but felt they had little influence over what sector or type of client they won. This really struck a chord with me.

If you are an entrepreneur you’re in business for many reasons but one of them is control. You have the ability to decide what your business does, when you do it etc. Of course, all businesses have customers of some sort and you need to keep them happy if you want to succeed. But the ability to decide what you sell and WHO you sell to is a fundamental part of being a business owner. Why then do agency owners feel that they have no control in this area? Lack of confidence may be one factor but I believe the root cause is that they don’t set out to work with a target market.

WHO you want to work with is as important as WHAT you do and a fundamental part of WHY you do it.

How to define WHO

When I work with established agencies on defining WHO they should target, I often find that my clients want to start with a wish list. They focus on which clients they would really like to work with and/or which sectors they have a personal affinity for.

This exercise has some value of course. It uncovers what motivates people and where they would like their business to go. They can become quite excited (particularly if they feel constrained by working with anybody that comes their way as I suggested above).

The visioning process can be counter-productive though. An agency’s perfect clients may be some way from the reality of their current situation. Whilst I’m all for setting ambitious goals, blue-skying the client list can quickly become demotivating.

What I find works better is to start with who they are currently working with and refine the target market from there. This doesn’t mean that the agency must continue to target the same clients, but it highlights the agency’s strengths and track record and who they are best suited to. If you dig deeper sometimes you can be surprised by what treasure you can uncover.

I follow a 4 stage process which is outlined below:

1. Type of Business

Firstly I look at what type of businesses the agency works with. This in itself can be cut many different ways and is an interesting exercise. Some of the areas I explore: 

  • Are the clients in B2B or B2C (i.e. start with who they – your clients – serve!)
  • What market sectors, industries or verticals are the clients in?
  • What sizes of companies are they?
  • Where are they located?
  • Do they share similar problems (even though they might be in a different industry)?
  • Do they share similar audiences (even though they might be in a different industry)?
  • Do they have an established marketing department?
  • Do they have in-house capabilities for marketing production?
  • Do they work with other agencies?
  • Are they growing, struggling, flat-lining?
  • Are they value/premium brands?
  • Etc, etc…

2. Type of People

An agency’s clients have 2 identities. They’re a business first and foremost, but they are also a collection of people. I like to uncover not only what types of clients businesses an agency works best with but the type of people they are most suited to working with. What people does the agency support best and help to thrive? Who do they work with when they get the best results?

Some of the areas I explore: 

  • How senior are your main/regular client contacts?
  • As marketers, how sophisticated and experienced are they?
  • Do they control the budget?
  • Do they have a team?
  • What motivates them in their career?
  • What motivates them to work with you as an agency?
  • How would you describe the dynamics of the relationship?
  • What problems do they have?
  • Etc, etc…

3. Impact you (can) have

Thinking about the current clients I then go on to explore the impact that the agency has on – and for – them.

Some of the areas I explore: 

  • What tangible results do you deliver for your clients?
  • What’s special about how you deliver these results?
  • How do you make your clients’ lives easier?
  • Why do you deliver good results for some and not so good results for other clients?
  • Etc, etc…

 

4. Not for you

Finally, I look at refining the list to see whether there are any client types (not individuals) who the agency doesn’t want to work with.

  • Which type of clients would you resign immediately (if you could)?
  • Which type of clients would you never work with (this might be industry-specific and related to your values e.g. SOME agencies might prefer not to work with clients in the gambling sector)
  • Be honest, what type of clients don’t get results from you.

N.B. This exercise comes with a caveat. A reminder that business is not easy and the perfect client doesn’t exist. We’d all like to think we could live in a world where clients don’t change their minds and budgets weren’t finite and/or timescales were flexible. The reality is we don’t and therefore a dose of reality often needs to be applied here.

The importance of WHY

I hope this article has achieved 3 things as a minimum:

  1. Convinced you that thinking about your target market first is crucial to a great Value Proposition.
  2. Highlighted to you that the deeper you can go into your target audience, the more information you will have and the easier they will be to find and convert.
  3. Given you a head start on how to go about defining your WHO.

As a final point, by suggesting you start with WHO you’re targeting, I want to make it clear that I’m not for one second saying that having a compelling WHY is not important. Nor is it impossible for agencies to find.  

Indeed, having a strong purpose or mission is vital for the modern organisation. Studies have shown that it’s particularly important and motivating to younger people.

For the reasons outlined above, I just think it is easier to start to piece together a niche positioning and articulate a compelling Value Proposition for an agency when you start with who.

Next Time…

In Part 4 I’m going to be looking at WHAT your agency does for its clients.

You’ve defined a market and have a clear focus on WHO your clients are. But WHAT do you actually do for them? How does it really add value and what motivates them to buy from you? If you’re thinking we build websites or we do their digital marketing, then I think you’ll find this next piece interesting. Stay tuned.

If you don’t want to miss it, sign up for my email updates here.

How to become a niche agency – PART 2

The importance of niching

My last article on niching was the first in a series. I had some great feedback on how to become a niche agency and hopefully, some of you are returning for Part 2. In case you missed it, find Part 1 here.

As you can tell, I’m an advocate of agencies’ niching their offer. It’s always been a viable strategy, but the market is more suited to specialist players than ever before. There are far too many generalist agencies and even more generalist digital agencies. I except, however, that the decision to niche is hard and the ability to deliver a niche offering is even harder.

In my last piece, I focussed on presenting the case for why marketing agency owners should niche their businesses. In this article, I’m going to explore some of the mistakes that people make. I’m then going to explain what niching really means.

We all make mistakes…

You’ll not be surprised to hear that the first mistake I think people make when niching is they don’t do it at all (or at least they don’t do it properly). Here are some other common mistakes I see when people are considering niching (and how to avoid them).

  1. They don’t go far enough – They consider focussing on a few industry sectors as niching. To make a difference and be transformational, niching your agency has got to feel uncomfortable. If it’s in your comfort zone, you’re not going far enough. Specialising in Sports Marketing is not a niche. Specialising in marketing football clubs is getting there.
  1. They believe that the niche is the entire market – Your chosen niche is just your target market, it’s not your total market. Other clients outside or on the periphery of your niche may choose to buy your services. N.B. Rest assured they will (!)
  1. They consider only industry sectors – When people think of targeting a niche they usually focus purely on industry sectors. There are many nuances and ways of cutting niche propositions. For example, you might choose to focus on clients that want a specific result (regardless of their industry).
  1. They consider it a marketing comms or worse a cosmetic exercise – Niching must establish a change in your entire agency. If it’s just a few words on your website it’s not going to achieve what you want it to.
  1. They don’t do it early enough in the agencies life-cycle – If you’re a young agency and you’ve survived the first year in business, now is the time to be thinking about niching.
  1. They don’t see the wider benefits – Niching is not just about winning clients and growing revenue it’s about developing expertise, sector knowledge and a brand.
  1. They try to be too unique – We’re not looking for unicorns here. Differentiation is the goal, not complete uniqueness. If you try too hard to be the only one in the market then you’ll never find that elusive gap or make the decision.

Niching is Positioning

As I explained in my last article, niching is not something to be afraid of. It’s in essence choosing and achieving focus. The tighter the focus the better. It’s the ability to appeal more intensely to a smaller group of clients. In a highly saturated market, it gives your agency an instant competitive advantage. You become an expert in your field.

More importantly, niching is just another way of looking at market positioning. Many of you will have worked with a crosshair positioning map where brands are placed on the axes relative to their positioning in their market. BMW as premium drivers’ cars versus Ford as a more mainstream functional vehicles for example.

Put simply, positioning is determining the distinctive place that you want to occupy in the market, relative to the competition and in the minds of your target customers.

The most effective positioning lives at the intersection of relevance (fit with your customers’ needs) and differentiation (the difference between your business and the competitors). 

Whilst most agencies use this as a tool for supporting their clients, many fail to give it a second thought when thinking about their own businesses. Most agencies place themselves firmly in the centre of the crosshairs. Wanting to deliver everything to everybody.

If the issue of positioning is talked about within agencies, it’s usually thought of as a marketing problem or activity. The outputs are usually the fabled crosshair model, a positioning statement and maybe even a couple of options for straplines.

Positioning is often treated as purely a marketing concept. In reality, it’s more fundamental than that, it’s about your business model. It’s not just a marketing decision, it’s arguably the most important business decision you’ll ever make.

Finding your niche positioning

You can spend hours analysing the market, your competitors, the economy, trends and/or trying to predict the future. Some of this is useful, but it rarely uncovers a clear niche which everybody in the organisation subscribes to.

As with many things, I find starting with the end in mind is the best approach. What is the outcome we are trying to achieve? I also find a template or formula saves time and works well too.

A niche positioning is of no use if it is not captured and communicated well. The way we communicate our positioning is through a Positioning Statement and/or Value Proposition. 

This is the outcome we are trying to achieve.

 

The Value Proposition and Positioning Statement

Almost as important as finding your niche and committing to it, is communicating it.

As poor as many agencies are at targeting customers, they usually find similar challenges in communicating with them.

The process of moving from the language of “award-winning team of committed individuals that specialises in X, Y, Z and A, B, C” is a big hurdle. It can be helped by summarising the positioning of your agency in a Value Proposition or Positioning Statement.

The terms Value Proposition and Positioning Statement are often used interchangeably. I think Value Proposition is a more modern term (I certainly don’t remember it from my degree!)

Technically there are differences:

Value Proposition (VP) – A short compelling statement that describes what customers can expect to receive by using a product or service.

Positioning Statement (PS) – A similar statement to the VP, but with more of a focus on how your brand performs and what advantages you have over those of a competitor or competitors overall. And why these differences matter.

Crucially both focus on benefits (to the customer and over the competition respectively). This is important as so much marketing comms from marketing agencies focuses on features not benefits (how many awards won, people employed, number and type of services etc).

You can have both a VP and a PS of course, but I prefer to keep things simple. I also prefer to focus on the Value Proposition. I believe marketing agencies spend too much time looking inward and/or comparing themselves to other agencies. Bizarrely this results in most agencies looking and sounding the same. The PS tends to fuel this a little.

A VP is more client-focused.  I like the fact that it zeros in on what problems clients have (both from a brand and personal perspective) and how your agency solves them. you need to know the problems and you need to know how you solve them and how effective  you are at doing so.

Clients, like all customers, are most interested in what you can do for them. They’re not bothered about your view of why you’re better than alternatives. That’s for covering later in the sales cycle (if it’s necessary at all).

 

A formula for success

A quick Google search will reveal many formulas and templates for creating Value Propositions. 

I like to use this version:

  • We are for…(who your target clients are)
  • Who are dissatisfied with… (ideally the clients’ problems but could also be current alternatives to your agency)
  • We…(what you actually do and deliver – Tangible Benefits and Logical reasons to believe)
  • By…(how you do it)
  • Because…(why you do it and what you believe in – Emotional reasons to believe)

Practice what you preach

If you complete the formula above you will end up with a list of bullet points. You can then create a paragraph of text if you wish.

In the interests of showing an example and to prove I try and take my own medicine I created the following for Beyond Noise:

We are for ambitious joint-owners of established independent marketing agencies who are between 10 and 50 people. They are dissatisfied with the performance of their business (but want to grow not exit). We provide growth advisory services including business strategy, marketing strategy and performance optimisation. We do this through mentoring agency owners and their senior management teams. We believe that enjoying the journey of growing and running a profitable agency is as important as an exit.  We are also keen to promote gender equality in the sector and are particularly keen to work with female agency owners.

 

This is by no means perfect and it will evolve over time. I really want to niche further into a specific type of agency. For now, though this has really helped me to focus on my niche and sell my proposition.

The words are chosen carefully. For example, the people I want to work with must be ambitious (they want to make big changes). They must want to grow and not be desperate to sell (yet). They are ideally joint-owners (they get more clarity and traction, and I get more satisfaction, from working with partnerships than I do with sole owners).  I’ll not go into further detail as this is not my point.

The real question is can you describe your agency’s positioning in these terms?

 

Next Time…

In Part 3 I’m going to unpack the Value Proposition formula above and give some examples of how I’ve applied it to agencies and how you might do the same.

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