Most marketing agencies start and end as small businesses. The clientele will range from 100 to 200, with an active ones at any time hovering around 10 to 20. Why is it this way?
Being a corporate marketer for over 20 years, I have lots of friends in this business. Curious to get an answer, I spoke to a bunch of them. Here are some verbatim.
(a) Agency work is intangible. We do a lot of things like creating awareness, driving traffic, but there is no clear outcome that is tangible.
(b) Setting and managing client expectations, due to the nature of intangible business, is a major trouble.
(c) Retainer business is desired, but not easy.
(d) Growing the team and managing the creative elements isn’t easy,
(e ) I am fine to be a boutique agency — no hunger to grow,
(f) too many players, and so on.
What caught my attention is agencies who set expectations backed by data, and organizing the creative elements as a library — have grown well. But these are a very small group. The image in this LinkedIn post just resonates that well. Every agency has a couple of terabytes of creative assets, that are scattered in emails, and individual drives.
If I say the top digital marketing agency in the world earns upwards of 2 Bn$, in the non-advertising category — is it surprising you? Some of the Big4 consulting houses are already in the race – read as PwC Digital, Accenture Interactive et al. With covid19 the digital proliferation is taking unprecedented heights, and this will hasten the industry growth. Early indicators are already on.
What happened to the music bands with technology (CD) and helped them to suddenly jump their reach from few concerts in the neighbourhood, to million copies sold – is waiting to happen for Digital Agencies.
Are the agency fraternity, seeing the opportunity?