The Supper Club asked me to be the ‘expert’ on a couple of roundtable events over the last few weeks and the sessions highlighted a number of interesting approaches and strategies that agencies are using to help them succeed in these difficult times.
The topics of discussion ranged from the best approach to rebuilding value and revenue with your clients, what the future agency model might look like, and what the implications are for my sales and marketing strategy right now.
What's the best approach to rebuilding value and revenue with your clients?
In a world of uncertainty, the one certain thing is that this period of economic difficulty has just started, so we need to be looking at longer-term strategies to drive revenue with clients.
It’s going to be a more competitive environment, with fewer briefs and tighter budgets. This means more agencies will be fighting over the same opportunities. You’ll have to be fit to survive.
Doing nothing is not a strategy. Waiting it out until spend returns is not the right thing to be doing right now. You might not want to stir the bee’s nest but getting in front of your client’s decisions is a much safer place to be and having the facts at your disposal so you can start to planning your way forward. Be on the front foot, find out what your client’s recovery plans are and establish your role in them. What are the triggers needed for a return to ‘normal’ spend? Tip: if your contact doesn’t know then you’re in trouble and you need to develop some deeper and wider relationships with better champions. The idea is that you want to be a brief maker, not a brief taker.
Keep your clients informed. This links with where you should be putting the marketing and thought leadership effort right now. An informed client is one that can make a decision, the better informed the lower the risk of making a decision and the more likely they are to make one. Insights will need to be tailored, relevant and timely.
You’re likely over-serving your clients right now and that’s ok to a point. Make sure that you’re over-servicing them in the right way. Spending additional time delivering insight, proposals, ideas and products is good as it’s investing in the relationship as well as potential revenue upside. Over delivering on what you’re already doing for them is bad and wasteful and sets expectations of business as usual for when things return to normal.
What implications are there for my sales & marketing strategy?
RFPs and inbound leads will be at suppressed levels for the foreseeable future. So, you’ll need to improve your game and outbound marketing capability and activity.
Which channels you use will depend on your business and sector, but your focus need to be on adding value and not leading with a sales message. This is an excellent time to be building brand value and advocacy with prospects for when the market returns and, as stated, helping them get back to recovery.
Measure how many leads you want from each marketing channel and define targets. Modify and refine your activity with experience (messaging, frequency, creativity) and if it doesn’t work, drop it and focus on what’s working.
Email marketing open rates have improved since the crisis.
Whilst we’re talking stats, recent Kantar research showed that brands that ‘go dark’ risk losing up to 25% of their share of voice when the market returns. I think this applies to agencies as well and it’s a message you want to take to those clients who have paused or reduced spend.
If you have a strong balance sheet, making a well-timed acquisition is also a good way of delivering growth and revenue to your business, as well as a new capability and a new route to market. If you’re considering this, timing is key as some agencies considering a sale now could be more distressed in a few months’ time which isn’t a good place for a buyer or a seller fighting with administration. Better to be more strategic and targeting a list of good businesses that need support e.g. cash injection, help to grow, access to services. Advisors can be very useful here with knowledge of the market and the ability to spot a good business from bad, deal support and due diligence.
All brands are having supply chain conversations at the moment and are busy reviewing their risk and exposure. These will be open wounds that must be remedied. They may have been overexposed to China or Italy for example. In terms of your strategy you should be thinking both short- and long-term. Short-term, they’ll be looking at what they can do to plug the gap (this means low-risk, low-cost and proven solutions will likely get more traction). Longer term they will be looking at how consumer demand and behaviours might change, which means looking at insight-led services.
What does the future agency model look like after Covid-19?
More strategic partnerships driven by a need for safety in scale, more access to opportunity and a need to demonstrate to clients greater capability without the risk of having to developing it yourself. This could be anything from loose working relationships to full M&A depending on the ambitions and needs of both businesses. With balance sheets coming under increased scrutiny from procurement, being part of a bigger entity makes a lot of sense.
More agile engagement models along with a more flexible supplier and freelance base will be the new normal. Also, brand could end up with headcount freezes meaning that agencies have an opportunity to place their own people to supplement client teams.
Office or no office? This is still undecided. Although the likes of Twitter have announced that people can chose to work remotely indefinitely if they wish, I think we’ll see offices being smaller and more flexible in terms of lease arrangements. Areas to collaborate and meet with clients still make sense.
Remote working has accelerated people's adoption and acceptance of what was already a trend. This will give rise to a wider talent pool not restricted by geography.
As Partner at Waypoint Partners, Miles' passion is to help agencies achieve their growth ambitions and enhance the value of their businesses.