Agencies. For this post let’s define them as “Companies that help other companies with their marketing related activities.”
Besides the original advertising agencies, the dawn of the internet also spawned a lot of new types of agencies to help companies navigate this new digital world of ours. For the last 10 years, I worked at one of those. I helped clients create websites, attract traffic and for the largest part of my career measure what that traffic did. I ended up as the Director of Analytics managing a team of 14 analysts within an advertising agency of ±85 people before becoming an independent consultant as of 2019.
The Challenge Agencies Face
Where normal companies are focussed on building the best service or product to match their clients’ expectations, digital agencies are continuously learning enough about future techniques and skills to help their clients today and tomorrow. Their challenge is to stay relevant and valuable by learning the right new skills at the right time as their older skills quickly depreciate in value. Like Steen Rasmussen of IIH Nordic once told me, “Building an agency is like building sand castles in quicksand.”
Building an agency is like building sand castles in quicksand.Steen Rasmussen
I’ve worked with a lot of clients both small and large. Digital native companies. Companies that (tried) to transform. Startups. Non-Profits and everything in between. Looking back on this period, I think the questions posed below could help most companies looking to hire an agency to increase the chance of building a mutually successful relationship.
1. Do you know what outcomes you want and why?
The biggest mistake humans make in (professional) relationships is to not clearly articulate what they expect to happen and why. Now you might prefer to be more “casual” in your personal life, but in business, these kinds of misalignments will cost you money.
Per definition, agencies specialize in the “How”. They are great at optimizing and executing how to get somewhere using their in-depth knowledge and skills. It’s up to you to make sure they understand what the desired outcome is and preferably also why.
Ideally, you want to define clear measurable goals with short feedback loops. It usually makes sense to explain your entire “pyramid of objectives” to make sure everybody is on the same page and understands what higher level objectives you’re working towards. This also gives the agency the opportunity to be proactive and think like a partner, more on that later.
Don’t make the mistake of “trusting their expertise” to understand what you need, you’re actually hurting the future relationship by not specifying clear and measurable objectives to align on.
Sidenote: a lot of agencies also (want to) offer strategic services to help you define these directions.
2. Do you know what you’re giving up and what you hope to gain?
Understand the dynamics of an agency and outsourcing the execution of what you’re paying for. If you choose to outsource something to an agency, make a clear list of why you are outsourcing it and what the downsides and upsides are. Share this list with your agency so that you’re on the same page.
I think that sharing this also helps set the expectations you have from your agency and might make them more aware of your objectives and how you expect to work with them.
- Shorter time-to-market
- Not influenced by internal politics
- Avoiding common pitfalls
- Freeing up your time for X
- Not building up in-house knowledge
- Out of pocket money
- Lack of domain expertise
- Less control over execution
When I worked at my previous agency I created a list of 6 main reasons why our clients hired us. These often overlapped. The list is far from complete but it might give you a glimpse of how agencies might think about your organisation ;-).
- Lack of Expertise (unable or unwilling to attract certain specialism)
- Lack of Capacity (need to scale quickly or temporarily)
- Lack of Action (need help activating internal team)
- Lack of Structure (need help organizing marketing efforts)
- Need for Disruption (need to challenge internal organization)
- Need for Security (need to be able to say “we hired the best to do it!”)
3. Do you want a partnership or a supplier?
A lot of larger companies get used to “squeezing deals”. They treat every B2B connection they have as if they are a supplier of goods and make them jump through hoops and try to squeeze every last drop out of every negotiation.
The difference between working with a supplier of goods and an agency is that the output you receive is produced by humans instead of machines. I’ll let you figure out what the effect of treating them as a supplier might be. Your agency partnership should be focussed on unlocking exponential growth, not cutting costs.
I personally believe that in most situations it’s smarter to play the long game and build a partnership of trust and become the type of client that the agency is proud of. It’s my experience that those clients always tend to get picked to spend some extra time on to learn new skills and submit as “award cases”.
So instead of squeezing your agency at every negotiation and making them jump through pitches and RFP hoops with procurement, it might be smarter to devise an enticing bonus program for them tied to your objectives and build a long-lasting partnership. Win-win.
Once you’re able to clearly convey your overall strategy to your agency you might find yourself pleasantly surprised about what they come up with to help you get there!
4. Do you have the right people to match with the agency?
Agencies require people on the inside. Depending on the size of the project or total scope of work you usually need at least:
– A main point of contact who knows how to get stuff done internally
– Someone with high domain expertise (to ask questions)
– Someone senior with leverage (to get stuff on the agenda)
If you’re lucky you can combine these characteristics within the same person. However, don’t make the mistake of gambling your budget on an agency when they are unable to reach anybody internally who has the time to help them out to get stuff done.
5. Are you able to trust an outside company and work result based?
Agencies usually have a totally different working structure than you’d expect a normal in-house team to have. They usually batch their work for specific clients on specific days to minimize the amount of time lost on switching tasks and context, for instance.
To some this might feel weird and “out of control” or look like there is “not enough action”. But the worst thing you can do is jump in and micro-manage the agency. I bet if we did an informal survey among agency personnel one of the top frustrations
If you ever catch yourself doing that, look up your list of “upsides of hiring an agency” and realize you’re sabotaging one of them.
Set clear targets and give your agency the benefit of the doubt. Be ruthless when it’s time to evaluate, but don’t waste their time needlessly and let the specialists do what they came to do without bothering them.
I hope these 5 questions help you to become successful when hiring your (next) agency. Please let me know in the comments below if you have any additional tips or feedback!
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