What’s the fuss about digital agencies?

Posted: February 3, 2016 by Robert Craven

People keep asking me, “What’s the fuss about digital agencies? Just a bunch of young hipsters and geeks making out that they are something special. No more, no less.”

Well, the answer is both Yes and No.

On the one hand, digital agencies, relatives of the marketing agencies, are just another agency. So, what’s an agency? Well, a ‘marketing’ agency, for example, used to act as the execution sub-department of the marketing department, an outsourced ideas/creative team at a fraction of the cost of having permanent staff. So, the key strategy behind an agency is independent expertise and delivering value for money. And neither aspect (expertise and value-for-money) has changed.

So, if the agency piece is no different from the past then is it the digital piece that makes them so special? Again, I don’t think so. Digital agencies are just 21st Century versions of Madmen, the TV series, looking for ways to help clients make more sales and grow their business. And maybe that is the point: everything and nothing has changed.

The fuss about digital agencies is actually nothing other than the fact that they are a distillation of everything that a modern-minded agency needs to and should be. And that is exciting.

Results are at the centre of everything they do. All outputs are visible by all. As such, the agency’s effectiveness is there for all to see. For example, the campaign costs $x and generates y leads or z sales. The campaign costs $x and it would have cost 20% more if we had tried to do it ourselves. More importantly, the agency has expertise we don’t have nor wish to manage. So, first and foremost, what makes digital agencies special is this sense that they are naked: they deliver on their promises or they fail. However, there is more that makes them such a special case.

Digital agencies are constantly surfing the crest of a wave, always looking for the next big thing. Always looking for ways to give their clients an advantage over the competition. This adds huge risk into a business that prides itself on delivering results.

Right now, digital agencies are the domain of the young. People of 30+ feel that they might be past it (in terms of speed of thought and being on the cutting edge); grey hair is a rarity. It is this focus in the business, this focus on the doing, that makes the industry particularly myopic. So many agencies fail because they become preoccupied with the detail of the doing… they fall in love with the product and forget about the customer and what it is that the customer is looking for. How often do you hear agencies criticised for their lack of customer focus? If I had a pound for every time…

Because of their youthfulness, their inward focus and obsession with bright shiny objects, agencies are different from other service firms. Brilliant at doing the pointy-hatted coding/optimising/Google/Wordpress stuff but not so good at the nuts and bolts of running a business and business strategy. Not 100% unique but certainly different.

So, what most agencies need, in my humble opinion, is to get their act together on all the so-called boring stuff. Stuff which actually is not boring at all. In fact, if you want to stand out from your agency clients then being better at coding is simply not enough. All the evidence shows that the majority of clients do not buy from you for your technical excellence or for your cheap low price. They buy because they think you can give them what they want. Agency marketing is not a battle of the product but a battle for the mind of the customer!!!! And don’t you forget it.

The remarkable agencies can do all the clever WYSIWYG-type things but they also have the strategic fundamentals in place. And it is these fundamentals (“the (not so) boring stuff”) that sorts the high performers from the rest.

Research I have been involved with consistently shows a direct correlation between long-term success and having business strategy in place. This is not some nonsense business school exercise to satisfy the whims of a dotty lecturer. This is simple fact. Most agencies need to get to grips with the basics of their business by asking some basic questions and drilling down to understand what the answers mean for the business:

• Why should people buy from us when they can buy from the competition?
• What makes us different from the rest?
• What do we specialise and excel in? What makes us unique?
• Who are our target customers (segments) and what are their specific issues and how do we differentiate our offering so that we are the obvious choice?
• Have we put in place really effective (= customer-loved) systems and processes for consistently finding, winning and delivering remarkable work?
• How do we compete against our competition?
• Is our team cooking on gas? (Really?)

The truly successful agencies, in the long run, are those that get on top of creating the fundamental building blocks of their business.

Of course, digital agencies are different from other businesses. More importantly, successful agencies are very different from the under-performing, run-of-the-mill, predictable, boring, average agencies that surround most of us.