Digital Agencies: How Tough is it Right Now?
“The digital landscape right now is a minefield. It’s the worst it’s ever been.”
That’s how the conversation kicked off at the bar, and honestly, it’s hard to argue with that sentiment.
As agencies, we’re in the thick of a perfect storm: political and economic uncertainty, technological disruption, and downward-slipping client expectations.
So, what really matters?
Economic Pressures
It’s tough out there. We’re dealing with tight budgets and slow sales cycles. Clients are scrutinising every dollar/pound/euro spent and demanding more bang for their buck. It’s essential to sharpen your value proposition and showcase your worth—loud and clear—to the right audience. This is a positioning problem. Or a business model problem?
AI: Friend or Foe?
AI is shaking things up. By the end of last year, over half of digital agencies had already jumped (or claimed to have jumped) on the AI bandwagon. The real question isn’t whether to use AI, but how to weave it into our workflows. How to deal with this?
Talent Crunch
The skills gap is widening. The generation gap is also widening. To tackle this challenge, we need to double down on training and development. If your team is your ‘greatest asset’ then you need to invest in them and keep them engaged!
Margin Squeeze
The days of enjoying 25-35% pre-tax net income are fading fast, with many now eyeing 17% as a lofty goal. This is a business model problem.
The Reputation of Digital Agencies
The punters are tired of agencies that promise the moon but deliver a fraction. The industry’s reputation is at a low ebb, with clients growing wary of bold claims like “we guarantee attributable results.”
Action Plan (First Draft!)
Evaluate Your Business Model: Is your pricing too low or too high? Or is your positioning off? Identify what needs to change and make those adjustments.
Evaluate your Positioning. Stand Out: Differentiate yourself through your core values and domain expertise. In a world full of beige sameness, be bold! Stand for something unique.
Get all over the numbers
Focus on Client Relationships: Trust is paramount right now. Build it, nurture it, and watch your relationships flourish.
Be Adaptable: Flexibility is a survival skill. Remember, the agencies that will thrive are those that deliver exceptional value in the eyes of their clients.
A Positive Note to End On
Let’s wrap this up on a high note!
Just like you stepped up during the challenges of COVID, it’s time to rise to the occasion again. Yes, the agency landscape is tricky, but for those who are ready, it’s still bursting with opportunities.