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Four Questions To Ask Before You Think About Adding A Minority Partner

Agency owners want to reward their best employees and prevent them from leaving. Obviously, the best way to do both is to offer equity or to become a minority partner in the agency, right? Not so fast. Crafting a pair of golden handcuffs for a model employee sounds like a great idea, but when those handcuffs are forged from the company’s own foundation, the proposition gets dicey. A model employee might be vital to the agency’s success, but initiating the transition from worker to owner can have far-reaching consequences. In fact, the world watched it happen two years ago: Former McDonald’s CEO Don Thompson stepped down after the company saw its worst U.S. sales slump in more than 10 years. Not surprisingly, Thompson happened to be the poster child of an employee-turned-owner. Starting in 1990, he worked his way up the fast food chain’s echelons from project manager to staff director to regional manager and, eventually, to CEO. As an agency owner who’s searched for a successor myself, I’ve seen the pitfalls. Before taking the leap to take on a minority partner, ask yourself the following: 1. What is a minority partner, really? Minority partners are a myth. If you offer someone part of your business, that person will act like a fellow owner — and not a minority one. He won’t think in terms of percentage of ownership, but in terms of haves and have-nots. In his mind, even a sliver of ownership puts him in the “haves” camp, and he carries all honors and benefits thereof. In some cases, that means the minority partner brings great ideas that drive the agency to new heights. In others, he slows down operations and starts fights [...]

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The Advantage Agencies Have In The Recruitment Game

It doesn’t matter whether you’re in a large suburban market or a small rural one. It doesn’t matter whether you’re a big shop, a small shop, a specialty shop, or a digital shop. Agencies across the country are struggling to find, recruit, hire, and retain great employees. It just one big recruitment game and do you know how to play it well? Even as marketing, advertising, and promotional managerial positions are expected to increase by 10 percent through 2024, agencies struggle because everyone — not just agencies — is trying to attract the same employees. Everyone in business is looking for people who are digitally savvy, who understand content, and who can sell. One would think that with employment rates for marketing, advertising, promotions, public relations, and sales managers rising faster than the national average for all occupations, talent wouldn’t be hard to come by. However, agencies traditionally can’t compete with large corporations that pay more, have better benefits, and allot larger budgets to their marketing departments. But there’s one card agencies hold that corporations don’t: culture. There’s an atmosphere — created when an agency brings together a group of like-minded creatives and leaders — that automatically attracts the most talented individuals. It’s addictive. Employees won’t want to leave, and recruits actively seek out those environments. While corporations can implement culture initiatives, agencies automatically have an upper hand when it comes to creating cultures that marketing and advertising professionals will love. However, there are additional steps agencies can take to truly seal the deal when it's recruitment time and also when it comes to retaining talent. Give them an opportunity to move up. Both employees and recruits recognize that, at an agency, the advancement and professional development opportunities are [...]

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Are agencies a dying breed?

I always find it fascinating when conferences bring together a panel of professionals and ask them to look into their proverbial crystal ball and tell us how the world will be different. A couple weeks ago, during AdvertisingWeek's conference, a panel that consisted of Jack Bamberger (SVP of Global Partnerships at Oath, Jeannine Falcone, the Managing Director of Digital Marketing for Accenture Interactive, Kelly Mooney, Co-lead of IBM iX Studios, Stephanie Anderson, CMO and Strategy Officer at AI Media Group, Andrew Bailey, Partner and CEO of The & Partnership and Tim Castree, Global CEO of WAVEMAKER) pretty much predicted that agencies will not exist. You can watch the entire panel discussion here. A takeaway quote that you might listen for -- "In 3-5 years, agencies have a 30% chance of  survival." Have no fear -- they're wrong. First note that they all work for companies that sell with the "if you don't want an typical agency" line.  They are positioned against agencies already.  So of course they don't want to suggest that agencies can or will flourish in the future. Which doesn't mean they are completely wrong. As I have said many times, agencies need to: Stop focusing on selling stuff and instead sell their smarts, counsel and insight Need to re-think their pricing strategies Need to teach their account people how to ask better questions/be a strategic thinker Need to invest in continued education for themselves (owners) and rising stars I do believe that agencies will have to continue to evolve (as we always have) to stay relevant.  We have to get back into the C-suite.  We have to understand that we can't exist if we only serve the CMO anymore.  Our job is [...]

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How to Prevent Scope Creep when Scaling Your Business with Ryan Meo

If there’s one type of project that every agency struggles to do profitably – it’s websites. But what if it was possible to do web dev and not lose your shirt? My podcast guest Ryan Meo runs ScaleSquad.com, a private label website services outsource solution for agencies. He and his team have web dev down to a science, making great revenue on the types of projects that many agencies struggle to deliver on time or anywhere near the budget. One of the secrets to their approach is to focus on what their clients aren’t getting instead of what they are. Ryan and I spill all of his secrets starting with: How Ryan started selling websites -- even though he didn’t know how to build them Taking a custom service like web design and making it scalable Why you have to prevent scope creep by being firm with clients on what their deliverables are (or by moving them up to a higher package) How Ryan is able to charge a low, flat rate for his websites and why he puts a lot of focus on what isn’t included in those packages How to prevent scope creep, especially as a web dev shop Why you shouldn’t turn away customers who can’t afford your bespoke services Why agencies make a big mistake by talking too much in the initial call with a prospect Building a strong relationship with an outsourced web-dev shop like Ryan’s Why your project manager makes or breaks your agency The importance of over-communication How to mitigate unrealistic expectations What the ideal agency looks like for Ryan Ryan Meo has worked with hundreds of agencies and built thousands of websites over the years. About 10 [...]

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Attention CEOs: Accomplish more by doing less

Most CEOs are doers. They’ve built their businesses from the ground up and revel in the satisfaction their successes bring. But they can’t do everything themselves, and that’s OK. So, what should these doers actually do? When do CEOs delegate, and when do they take the lead? As a fellow CEO, I’ve contemplated this very question. I’ve found that involving myself in day-to-day tasks and issues can quickly consume my time and infringe on long-term goals. But CEOs need some level of involvement in every aspect of their business to make sure the company is on track to reach its long-term goals. The question isn’t deciding which areas to pay attention to but how you should interact with each aspect of the company. Resist the Urge to Do The balance between involvement and “doing” can be difficult to achieve because CEOs didn’t reach executive status by sitting back and delegating tasks to others. They got their hands dirty and took care of the nitty-gritty details. But once you’ve established processes and hired a dedicated staff, dissociating yourself from every decision can be difficult — and jumping into daily disputes can put your company at serious risk. For example, Chuck is the CEO of an advertising agency who used to head up the digital department. When his team is slammed and trying to meet a deadline, his first inclination is to dive in and help. However, spending a week writing code and testing a website isn’t the best use of his time because the areas that require his attention won’t get covered. As a company grows, it’s important that employees do their specific jobs so every aspect is taken care of. If Chuck loses sight of [...]

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Why Agencies are Notoriously Bad at Wooing New Business

New business isn’t something most agencies worry about — until it’s too late. Unfortunately, “too late” is often the moment after you’ve lost your biggest client. Every agency owner dreads this moment. After receiving the call, he rallies the leadership team to bring in some money, and the creatives get to work sending out some direct-mail pieces. Meanwhile, the agency owner pours himself a drink and sits down to put together a list of who will be laid off if the agency can’t drum up some revenue. It’s a bleak cycle that only ends after the agency either lands a new account or suffers a round of layoffs. One reason many agencies struggle with new business is that the process often depends on just one person. If that person gets busy or distracted, new business efforts come to a grinding halt. Other times, it fails because the agency owner doesn’t enjoy the process or he’s too caught up in his day-to-day responsibilities. But most of the time, it’s because it’s inefficient and takes too long to engage in every day. When it’s not a priority, it only happens when work is slow or when a big client suddenly ends a relationship. And when the worst does happen, it triggers a temporary flurry of new business activity. As writer Rae Ann Fera put it, “Long lead times, long pitch lists, layers of consensus needed to select a partner, layers of meaningless paperwork for RFPs, requests for spec work, lack of access to decision makers…when it’s bad, it’s pretty terrible.” If and when the agency manages to replenish its roster, it gets busy very quickly, and new business falls by the wayside once again. Instead of a last-minute [...]

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Types of Agencies: What Kind of Agency Do You Want to Build?

Agencies face all sorts of challenges as they struggle to decide what kinds of clients to serve and what kinds of deliverables to offer, and there are many different types of agencies you can be as well. For this special solocast (it’s our 100th episode!), I want to get you thinking about what kind of agency it is that you are trying to build and nurture. Some agencies build custom solutions for every client – a very labor intensive, creative endeavor. Others have a more limited list of services and products and do less custom work. There are pros and cons with each but you really need to decide which makes more sense, based on your goals. Problems tend to arise when these types of agencies don’t make a conscious choice as to which kind of agency they would like to build and nurture. Both are fine choices but you have to make a choice. Join me in determining which kind of an agency you are suited to build and why. We’ll cover: Two types of agencies: “Artisan bakery agencies” (every project they produce is custom made for a client) and “Wonder Bread factory agencies” (where they follow systems and processes to produce the same limited set of things for every client) Why clients often work with both of these kinds of agencies, sometimes even at the same time Misconceptions owners of both kinds of agencies have about each other Assessing what type of agency you own (and why it may fall in the middle of these two types) Some of the pros of running an “Artisan bakery agency”: you can hire millennials, you can be a partner for your clients, and the prestige that [...]

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Why Processes are Important: Your Agency (Not Your Clients) Should Come First

Anyone who’s ever worked in an agency knows how demanding clients can be. If you keep your clients happy, you’ll keep your agency happy, right? Wrong. As an agency owner, it’s all too easy to get sucked into the day-to-day tasks of client service. It actually much better for your agency when you do exactly the opposite. It may be hard to see why processes are important, but they play a key roll in any agency. Spend the bulk of your time developing your agency’s processes, people, and future, rather than talking with clients. You'll see these benefits for your agency when you step out of the weeds and into big-picture planning. Maintain forward momentum. Employees throughout the agency see you as the visionary who sets the course. If you’re not tracking trends, keeping tabs on industry shifts, and anticipating new business needs and opportunities, no one else will. It’s your job to push the agency to evolve and to take your clients with you. Attract -- and retain -- great talent. Employees want to work somewhere with a purpose. As the owner, it’s important to identify and retain people seeking more than paychecks. The more you’re able to get out of the weeds, the more opportunities you provide for your best people to grow. Set the right precedents. Clients need to trust everyone on your team. If you’re too deep in day-to-day tasks, you’re communicating to clients that you don’t trust your people enough to let them handle things. Plus, it makes it hard for you to escape the office. Owners who operate at too granular a level can’t take real vacations, turn off their phones, or disconnect from work. It’s not healthy. Your [...]

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Here’s Why Your Agency Didn’t Get Hired

When a client chooses not to hire your agency, it's easy to start second-guessing yourself. Often, I hear from agencies that are curious to know why they were disqualified and what they can do to improve. In our 2015 report, Agency Hiring & Firing Insights, we got the scoop on what 500 marketers -- CMOs with budgets up to $10 million -- believe and how those beliefs influence whether they hire or fire an agency. The results surprised us. We found that a whopping 94% of respondents believe their search and selection process is effective in finding agencies that are good fits for their organizations. So if their processes are so effective, what's that "special sauce" that makes them hire an agency? We saw a range of answers -- everything from "gut" to "socializing with clients" to a "review by a variety of staff, not just the marketing department." But we also learned a number of surefire deal breakers. What's Getting You Kicked to the Curb? We asked clients why they would disqualify a firm. These reasons came up consistently: The agency is a generalist. In other words, it doesn't have experience in the client's industry. It's increasingly important for agencies to find their niches and stick to them. The agency personnel is arrogant. The employees are self-aggrandizing or imply that the client should be grateful just to work with them. The agency has poor testimonials. The potential client reaches out to the current clients (often on LinkedIn) and learns that it hasn't grown those clients' businesses. The agency brings a pitch team, not the people the client would be working with on a daily basis. Clients want to know exactly with whom they'll be [...]

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Effective Team Building and How to Get Your Team to Work Well Together with Marcus Blankenship

For every agency the team you’ve assembled has a huge impact on your bottom line. You absolutely want to hire skilled, smart team members. You also want to have every player enhance the culture of your shop. But at the end of the day, you need them to work within your agency’s system and contribute to making the entire agency stronger and better. In my conversation with my podcast guest Marcus Blankenship we explore how to create the a dream team through better hiring, smarter accountability and the importance of regular feedback. Effective team building and keeping that team intact is what makes an agency money. Marcus and I show you how with: Why you must identify your high and low performers Why you shouldn’t be a passive-aggressive leader Why you can’t hire anyone you can’t fire Structured management: why you can’t set people free without management and why you need to set up strong management systems when your agency is small How to effectively build a team How to get your team to work well together Why consistent one-on-one meetings are so crucial What happens in your employee’s head when you cancel a one-on-one meeting How to create a safe environment where the people below you are willing to give you the feedback you need Why you shouldn’t let feedback sit more than a week Marcus’ one-on-one framework guide Marcus Blankenship is a management consultant, trainer and executive coach for software managers and leaders. He helps companies hire the right people, create the right culture, and set up the right process which achieves their goals. Managing a team isn’t something learned in college. In fact, his clients often tell him “I never prepared for [...]

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