the profitable agency: how to attract, retain and grow a profitable client base
DESCRIPTION
#INBOUND 14 agency track deck. Growth is the easy part. Attracting and retaining a profitable client base is the real challenge for agencies. As the demand for digital increases, many agencies are offering new services, evolving internal processes, and evaluating alternate revenue and pricing models. The presentation provides 15 actionable tips to maximize your agency’s profits in the new era of marketing services.TRANSCRIPT
#INBOUND14
the profitable agencyhow to a*ract, retain and grow a profitable client base
sept. 16, 2014
presented by paul roetzer (@paulroetzer) CEO | PR 20/20
of marketers think markeEng has changed more in the past two years than the past 50 !source: Adobe Digital Distress
76%@paulroetzer www.pr2020.com#inbound14
the consumer is the true change catalyst
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90% of daily media interac;ons are screen basedsource: Google, The New MulE-‐Screen World
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B2B buyers may be
up to 90% through their journey before contacEng a vendor. !source: Forrester
image: Jayneandd
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Source: Google
Every trackable consumer acEon creates a data point, and every data point tells a piece of the customer's story
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Source: Chiefmartech.com
the customer journey does not follow a linear path defined by marketers
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Define FoundaEon Projects
blog posts podcasts website video email
webinars mobile apps
tailored markeEng through a deep understanding of buyer persona needs + the ability to deliver personalized messages
Image: HubSpot
we have entered the age content, context and the customer experience
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Define FoundaEon Projects
create more value, for more people, more oDen, so when it’s Eme to choose,
they choose you
new marketing imperative
what’s holding businesses back from achieving performance poten;al?
image: Xurxo Marcnez
talent gap + tech gap + strategy gap = PERFORMANCE gap
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a story about the convergence of marke;ng talent, technology and strategy, and the opportunity to build performance-‐driven businesses.
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of marketers say their lack of skills is impacEng revenue in some way !source: 2012 MarkeEng Skills Gap Report
75%@paulroetzer www.pr2020.com#inbound14
of companies lack necessary digital skills in key areas of social media, mobile, internal social networks, process automaEon, and performance monitoring and analysis. !source: Capgemini ConsulEng
90%@paulroetzer www.pr2020.com#inbound14
a talent war has begun
for tech-‐savvy, hybrid marketers
capable of building, managing and execu/ng
fully integrated campaigns that produce results
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agile, adept at advanced marke;ng tech, and experts in inbound strategy
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how do we find the unicorns?
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only 1 of the top 10 markeEng programs in the U.S. has a required undergraduate
digital marke;ng course
source: U.S. News & World Reportimage: IUB Facebook
businesses must take the ini;a;ve to mold their own modern marketers
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by 2017, the CMO will spend more on IT than the CIO. !
source: Gartner
IT = CIO CMO
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6 classes, 43 categories, 947 companies
ExactTarget IPO (Mar '12)
Eloqua IPO (Aug '12)
ExactTarget buys Pardot (Oct '12)
HubSpot raises (Nov '12)
Oracle buys Eloqua (Dec '12)
Marketo IPO (May '13)
SF buys ExactTarget (Jun '13)
0 5 10 15 20 25
$161.5M
$92 M
$95.5M
$100 M
$871 M
$79 M
$2.5 B
venture funding, mergers, acquisiEons and IPOs fuel the martech industry
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analyEcs automaEon coding content digital ads email mobile public relaEons search social tech websource: AlEmeter’s The Converged Media ImperaEve
the new marke;ng mix
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source: Accenture’s Turbulence for the CMO
the markeEng industry is moving too fast to internalize everything
Donovan Neale-‐May, ExecuEve Director, CMO Council
“There’s an underlying level of frustra;on among senior corporate marketers worldwide when it comes to agency contribu;ons to business value creaEon, strategic thinking, and digital markeEng development.”
source: CMO Council (2012)
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of senior marketers believe tradi;onal ad agencies are doing a good job of evolving and extending their service capabiliEes in the digital age. !
source: The Chief Marke9ng (CMO) Council report More Gain, Less Strain.
9%@paulroetzer www.pr2020.com#inbound14
where do the other 91% turn for help?
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growth is the easy part. retaining it, and making it profitable, are the real challenges for agencies.
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a cauEonary tale of churn
Define FoundaEon ProjectsPR 20/20 growth (2009)
15 new campaign clients !
$195,000 in 2009 revenue !
$503,000 in 2010 forecasts
life is good!
0 clients remain
average rela9onship lasted 12 months
49% of marketers report they will consolidate or change agencies over the next 12 months. Another 15% aren’t sure. !source: CMO Council, 2012 study
64%@paulroetzer www.pr2020.com#inbound14
Define FoundaEon Projectschurn factors
financial instability focus on outputs, not outcomes over promise, under deliver siloed services stagnant business model stretched too thin talent turnover unbalanced porqolio weak processes
agency side
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Define FoundaEon Projectschurn factors
client side
conservaEve culture/budgets financial instability lack of vision low quality product/service markeEng tech deficiencies personnel weaknesses poor management unrealisEc expectaEons weak foundaEon
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work with agency partners that care as much about
performance and success as you do
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15 ways to maximize agency profits
Source: HubSpot
1) prove performance.
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2) develop scalable processes and services.
3) reduce business development Eme.
(remove despera/on)
4) achieve financial stability.
Define FoundaEon Projects
5) know when to say NO.
commit to clients and prospects who value your people, ;me and energy !
watch for red flags !
trust your ins;nct !
be willing to walk away
6) get paid for planning.
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2006
2008
2010
2014
7) establish value-‐based pricing.
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8) build brand and reputaEon.
image: David Guo
senior pro @ $75,000 = $32/hour vs.
junior pro @ $45,000 = $19/hour
costs 40% less for junior pro services
9) understand service-‐delivery costs.
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10) arract and nurture entry-‐level talent.
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11) move to campaign-‐based contracts.
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image: Xurxo Marcnez
12) fill talent, tech and strategy gaps.
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(eliminate waste)
13) track ;me and efficiency.
14) focus on reten;on.
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Speaking 5%
Publishing 5%
Events 10%
Sofware 10%
Services 70%
15) diversify revenue.
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paul roetzer, @paulroetzer !CEO | PR 20/20 author | The Marke9ng Performance Blueprint (Wiley, 2014) & The Marke9ng Agency Blueprint (Wiley, 2012) creator | MarkeEng Score & MarkeEng Agency Insider
www.pr2020.com