Lifecycle of an agency
It’s tough running an agency but the successful ones do well not just because there is demand for what they are offering, but how they navigate the key stages of the agency lifecycle.
We’ve identified six key stages and below is a taster of the common issues we’ve observed.
You start with a clear point of view of what should be done differently, something you are passionate about. But what you write and what you say are often very different. We see start-up agencies hide their light under the bushel of the generic language of their category in an effort to sound credible. If you are a start-up, you only have one weapon in the battle to win new business: Your Point of View. So, use it to the fullest.
People you know are your best source of new business in the early years. You’ve probably discussed your ideas with them in the first place and they gave you the confidence to make the leap on your own. On average, that initial list runs out after three or four years and it’s at that moment you realise you haven’t built a back-up list of ‘next’ contacts and you are exposed to chasing project work.
This can be a crucial period to navigate as you are starting to meet people you don’t know. This is when your laptop will get opened more times than in the past and so your story needs to be spot on. Chances are you are now up against someone whose laptop is closed as the client is talking to someone they know!
If you successfully negotiate Stage Two then you should enjoy a period of steady growth for the next three to four years, by which time The A Team is spread too thinly across the business and you have to decide how to let go of some things and begin to think about the next management layer. We often find that, as this happens, the quality of submissions in pitches starts to drift as everything becomes a bit last minute. A good time, therefore, to consider a full or part time new biz person to take the strain.
By now, you are around 12 years in and have gained such a reputation that you become attractive to suitors. For many, getting bought is the goal but can be a huge distraction and, again, we often see a dip in performance at this time or an over focus on delivering the numbers. For the employees, the question of the culture change is typically upper most and some may decide to take this moment to move on, which again can impact performance.
Once sold and the founders have departed the agency, we’ll typically see a succession of new top team from within or career CEO’s and MD’s arrive. It often takes a while to find that clarity of thought and focus that you had at the start, if at all, and many agencies have faded into ‘beige’ or disappeared if this is not achieved relatively quickly.
Well, what a journey that was! From entering the market with a new idea and now finding that you are the new normal. So, do you do it all again with a new idea? Many do just that – see Stage One above.
If you sense you might be at one of these life stages and would like to have a chat then please get in touch with us. We’re always happy to share our advice and offer help where we can. We’ll put the kettle on.