Do you know how hard it is to run a marketing agency?
If you don't run one, you probably don't know.
I had no idea until I started working with agencies on a daily basis. During the two years as a Channel Consultant at HubSpot, I was exposed to over 200 agencies working closely with the owners and their challenges, opportunities and successes throughout the development and scale stages of their businesses.
From thinking about where the next new client is going to come from to filling that open account manager role, these are some of the endless thoughts that go through agency owners' heads.
But what's even harder is that there is no one-size-fits-all playbook that has all the answers. The only way agencies learn is from their own experiences or from those of other agencies.
That agency-to-agency learning is what we try to facilitate for our agency partners at HubSpot because we know how valuable it is for them which is why I'm excited that we launched the Marketing Agency Growth Report just last week - a survey of over 1,000 agencies on their top challenges and provided solutions to them from experts in the field.
Today, I want to share with you my key learnings from the benchmark data.
14 Key Takeaways from the Marketing Agency Growth Report
#1. For 60% of agencies, finding new clients is the biggest pain point.
#2. That's no surprise then given that for 38% of agencies, referrals are the main source of new leads.
#3. In addition, 43% of agencies don't have a designated sales person to bring those new clients.
#4. 67% of agencies do plan to hire more staff next year though.
#5. But with 37% of each account manager managing more than 6 accounts and clients, who are agencies hiring for?
#6. In addition, without a designated new hire training programme among 59% of all agencies, are these new hires being set-up for success?
#7. What's more, with 47% of agencies not tracking staff utilisation rate, how do they know if their people are effective in their work?
#8. Shockingly, a whopping 57% of agencies don't have more than three months of cash on hand to cover expenses.
#9. Perhaps one reason for that is that for about half of agencies, less than 50% of their new business comes from projects rather than retainers.
#10. The pricing models seem to change based on client and through a combination of models for 43% of agencies.
#11. Apart from a proposals software for 34% of agencies, they don't seem to be using a particular quoting software to price and package their retainers.
#12. When it comes to major growth obstacles, agencies mention hiring new staff (28%), cashflow (31%) and the need for more sales and marketing (55%) as their top three challenges.
#13. Perhaps that's why 72% of agencies are planning to invest in lead generation from marketing next year.
#14. 26% of agencies are even thinking about merging with another agency or 21% are considering selling it to another agency.
As I said in the beginning, running an agency is no easy feat.
But now that you know about the major pain points of other agencies, I suggest reading the full report. It includes even more benchmark data on how agencies price and package, create new business practices, manage clients, handle hiring and financial metrics but most importantly essays, from industry experts who help agency owners build better businesses every day that will give you tips on how to solve particular challenges you may face.
What are your biggest agency challenges?