In these unprecedented times, economies are slowing down and digital marketing agencies are feeling the impact. Agencies, small and large, are facing challenges such as lost clients, decreased revenue, and reduced marketing budgets as businesses across most industries tighten their belts.
Some agencies are faring better than others. In a recent survey among marketing agencies around the globe, 16% of participants experienced an increase in revenues.
What sets these agencies apart is their ability to adapt to change. For digital marketing agencies to survive, it’s essential to play the long game—especially since it’s not known when the pandemic will end. This includes being creative, adaptive, and being able to craft as well as implement the right strategies. Here are a few tips to help you keep your agency running at its best:
Understand the Pandemic’s Effects on Individual Clients
COVID-19 has impacted all businesses, but some more than others. Certain industries are hard-hit, while others seem to be adapting well to the change wrought by the pandemic.
No matter how many clients you have, it’s good to assess the impact of COVID-19 on each one. By doing so, you can identify which clients in which industries are in danger of jumping ship. Catching warning signs early allows you more time to formulate and implement retention strategies.
Measuring the pandemic’s impact on your clients also allows you to determine which of them is doing well. Focusing your attention on these customers could be even more beneficial than offering incentives to clients who are considering churning. These types of clients may be more receptive to offers of added services and solutions.
Having a better understanding of your clients’ situations is also helpful in improving your relationship with them. Adding value for your clients and going the extra mile for them will go a long way toward making your relationship last beyond these challenging times.
Analyze your Ongoing Burn-Rate in Both Normal and Barebones Scenarios
Many organizations run with too many excesses—however, you don’t have to be one of them. Many expenses are avoidable, so you will want to go over your spending and figure out what’s essential and what you can do away with. Doing so can help you control overspending and get a leg up on the competition.
Identify areas where added effort and time allows you to reduce spending. Tailor your reductions to your business goals. Typically, you won’t be able to optimize your burn rate with just one significant change. Multiple incremental changes across departments can better help you trim low-value activities with minimal organizational disruption.
Focus on what maximizes the return on money, time, and effort. The goal is to be as efficient and lean as possible without sacrificing the quality of service you provide to your clients.
In a Changed Business Environment, Dare to Think Out of the Box
Across all industries, businesses are making major changes to the way they do business to survive in the new normal. Some companies are doing more than just survive. One example is Evil Genius, a brewery known for its cleverly named craft beers and popular bar and retail location in Philadelphia.
Having previously relied on sales to bars and restaurants for about two-thirds of their sales, Evil Genius faced a dilemma when these distribution channels closed off due to the lockdown. According to co-founder Hayward, the closure of bars reduced their business by about 60%.
Employing out-of-the-box thinking, Evil Genius focused on offering carry out service at their retail location and taking online orders for pick-up and delivery. They also introduced new products—a risky move that ultimately paid off when one of them, a beer referencing the wildly popular Netflix series Tiger King, became a hit.
A whiz at staying topical, the company also offered a free roll of toilet paper with a purchase of “The Gang Gets Quarantined,” a beer referencing both the lockdown situation and the popular TV show It’s Always Sunny in Philadelphia.
Their unique approach to marketing their products have helped them rise above today’s cluttered advertising environment. Their innovations in marketing helped make Evil Genius an online talking point when the news and social media outlets are heavily saturated with both bad news and a slew of competitors eager to capitalize on the public’s increased social media usage.
Evil Genius is an example of how traditional marketing approaches need to be innovative and adaptive. Creativity has always been the lifeblood of marketing, and it is even more so now. Your clients are facing significant changes in the way they market their products and services, and your success in helping them meet their goals rides on how quickly and creatively you can respond to these changes.
Be Flexible and Open to Adjustments
Small- to medium-sized digital agencies have the advantage of being more flexible than their larger counterparts. Since smaller agencies don’t have substantial overhead costs to worry about, they can typically afford to offer competitive pricing. This is especially true for agencies that work with businesses or organizations that are experiencing layoffs.
While the cost of retaining your services is lower than that of hiring an employee or employing their in-house marketing department, your clients must be fully aware of this fact. You would also want to show your clients that the value you deliver to their business far exceeds the cost of having you onboard.
You can achieve this by being more flexible in terms of pricing. At the same time, lowering your rates is an act that conveys your understanding of the current situation’s difficulties. It shows that you value your relationship and that you have integrity.
Flexibility can mean:
- Delaying Invoice Scheduling. If you have the financial capacity to do so, delaying invoices can be beneficial to both you and the client. Deferring payments allows your client more time to meet their obligations, and you also get to keep your clients at the same rate they paid pre-lockdown.
- Restructuring Contracts to Reduce Pricing. According to a survey by Upplers, 58% of agencies became more flexible in client terms, and 28% reduced their fees. The reality of the pandemic situation is that many businesses cannot or will not justify marketing spend in these uncertain times.
To retain clients, consider restructuring your clients’ contracts to accommodate their needs while reducing their marketing spend. This shows that your relationship with your clients is essential to your agency, and at the same time, it’s a move that drives long-term instead of short-term value.
- Offering Limited Services. If your client’s marketing budget is tight or if they don’t need as much work done on their account, consider reworking your contract to include limited services. For instance, your client may no longer need assistance with content creation but could use some help in social media. You can rework your contract to include only the services they need and reduce your rates accordingly.
This strategy results in cost savings for them and allows you to retain their business on an as-needed basis until the overall situation improves.
Learn From Your Competition
The pandemic has affected all businesses, but some are doing better than others. Assess your direct and indirect competitors and identify which ones seem to be toughing out the crisis better than most. Knowing your competitors and how they’re positioning themselves for success can help you identify strategies that allow your agency to succeed.
For example, many small to medium-sized agencies are currently outsourcing or planning to in the future. Outsourcing provides agencies with on-demand access to talent at less than the cost of taking on new team members.
You can use knowledge gleaned from observing your competitors to take advantage of their weaknesses. At the same time, you can improve your agency’s performance. Identify which of their strategies seem to be working and apply them, making adjustments to tailor-fit them to your needs and goals. This also positions you well for when the crisis is over, and your agency resumes normal operations.
Leverage Social Media Effectively and Creatively
Consumers are more active on social media than they used to be in pre-lockdown days. More people are at home and rely on social media channels to connect with their loved ones and get news and updates. Agencies that typically focus on other channels can leverage this uptick in social media usage to increase their clients’ reach, boost engagement, and ultimately improve conversion rate.
Doing so requires more than a little bit of creativity. Making memes, videos, contests, and the like a part of your clients’ social media campaigns allow their products or services to stand out. The key is to stay on-trend and keep content engaging and relevant.
Deliver Added Value to Your Clients
COVID-19 has not only transformed the way that agencies do business with their clients but also the way their clients do business with their customers. Changing attitudes to what’s essential and what’s not can lead to decreased revenue for your clients and, in turn, reduced marketing spending.
One way to keep your clients is to find places where you can add more value, especially for those businesses and organizations that are at high risk of churning. Determine whether there are additional services you can pitch to your clients. For example, you may be skilled at data analytics or content creation. You can offer these services at reduced or zero cost. This allows your clients to obtain services all from one place while minimizing their expenses.
What if you and your team don’t have additional skills that you can turn into add-on services? It’s best to be proactive and identify the areas with which your clients need the most help. Learn and refine skills in these areas to provide more value to your clients even after the crisis is over.
Assess Your Clients for Opportunities
As previously mentioned, the pandemic has affected different clients in different ways. For example, while clients in industries like tourism and hospitality are among the hardest hit, clients in the medical and personal care sectors are likely experiencing steady or increased volume.
When rebuilding your agency’s client portfolio, target businesses and organizations that are doing well. Even if they’re not usually the type of clients you take on, getting their business can keep your agency afloat.
E-commerce businesses are also faring well. For instance, if you typically handle local companies’ accounts, it may be worth your while to broaden your scope and pitch your services to online businesses.
Don’t Forego Strategic Planning
This crisis is rapidly evolving—as societal changes and their effects trickle down to marketing, agencies should be well-poised to plan for and adapt to them. This may mean having to re-strategize your accounts.
One strategy is to incorporate COVID-19 messaging in the ad copy. Doing so shows consumers that businesses are aware of the situation and keeps them relevant. It also allows brands to communicate how they’re helping consumers during the crisis.
Some brands are further adjusting their marketing to show messages of support or information on how they’re helping communities during these trying times. As evidenced by a spike in Love reactions on ads posted on Facebook, this is a strategy that seems to be working as far as brand engagement is concerned.
A good relationship with your clients comes in useful here. You can more easily communicate with them why and how any changes need to be made, from minor updates to ad copy to a complete pivot from traditional to social media marketing campaigns.
Plan for You and Your Clients’ Post-Crisis Recovery
While it’s not known when the current crisis will end and its impact further down the line, agencies should plan ahead. This may involve defining best- and worst-case scenarios, listening for changes in consumer attitudes, and adapting marketing plans on an as-needed basis.
While you may not have the expenses that larger agencies have to contend with, it is still wise to cut costs where possible without sacrificing quality. Keep in mind that all agencies, no matter their size, are going through the same major upheaval to their operations, and the key to surviving lies in resilience and your ability to adapt.
Making no adjustments and simply hoping to ride out the wave of change can result in your agency sinking. Staying afloat requires being open to change and prioritizing innovation to adapt to the new normal.