Agencies naturally ride the ups and downs of a low-margin, volatile industry any day of the week. It’s part of the business. Layer on the economic and emotional instability that came with 2020, and it’s surprising that agencies survived at all. The past year, and everything that came with it, was challenging for everyone. And as much as we want to put it all behind us, it’s worth looking at what we should take forward, too.
When I became an agency owner in 2008 (during a whole different financial crisis), I realized creating stability in a traditionally tumultuous industry was going to be my constant business challenge. I don’t necessarily live in the mindset that “a crisis is looming,” but I do what I can to prepare, just in case. Preparation creates stability, and dare I say, “flattening the traditional agency curves” has been my salve for sleeping at night.
Our world will always be a little unstable. While we rely on long-term client relationships, there will always be ups and down with their businesses, and our roster will continue to grow and decrease. There really is no constant, and that’s the work we signed up for. But there are ways to create stability — and it’s about controlling the elements you can and having some preparations in place for those you can’t.
- Run operations conservatively and maintain months of cash in the bank. Having cash for a handful of months in the bank allows you time to make objective decisions rather than emotionally reactive ones. When the universe throws a global pandemic at you, it’s helpful to be able to take a minute and make a plan so your decisions are thoughtful, thorough and smart for long after whatever it is, passes. If you are managing your agency on the edge already, you will not have the benefit of this time upfront. This may lead to multiple rounds of furloughs or layoffs, a lack of trust in leadership and an anxious, unfocused team worried more about employment than the work helping to keep the agency moving forward. During the “normal times,” managing the business without touching reserves provides the benefit of time to weather the not-so-good times.
- Intentionally create a diverse client roster. Back in the day, diversity of an agency’s roster was critical for growth. Historically, clients used to have more concerns about agencies working for other brands within the same category. As a result, agencies naturally had diverse rosters. Today, although some brands are still concerned with conflicts of interest, many are not. So agencies have become specialized in industries, and some clients have come to prefer this type of expertise. But when it’s possible to focus on a specific industry and provide best-in-class marketing in a specific field or two, an agency puts itself at a greater risk if that industry is hit harder than others during events like a national recession or global crisis. By using the non-crisis years to intentionally broaden the client roster, agencies are then also in the position to ride the wave of various industries wins and slowdowns. Client successes are agency successes, and as we’ve seen this year, crises impact industries in different ways — good or bad. While a crisis might require some to slash their marketing budgets, others might be spurred into a growth mode, creating an opportunity for agencies to redirect teams and maintain balance.
- Double down on people-first. Building trust and partnerships with employees is a long-term commitment. Many employees care just as much about where they work as the leadership they work for, and investing in people is an investment in the business. Our teams are what truly hold our clients, work and business together, ultimately creating the stability agencies need. Leading with transparency (sharing highs, lows and everything in-between) and providing emotional and personal support at the individual level, puts people first. In turn, employees will bring their strengths and talents to the work and clients, building strong relationships that become absolutely critical during times of change. Employees’ unique contributions make an agency what it is.
Many agencies are small businesses, and those are often the first impacted by crises. But agencies at their core are creative. We employ talented problem solvers. We create strategic work. We put immense thought into everything we do for our clients. During the good weeks, months and years we have, we can funnel that energy into strengthening business operations. So that in the more challenging moments, we can look inward and leverage that same strategic mentality to endure and make it to the other side with new ideas for surviving what comes next. Let’s hope 2021 is one of the good years.
Paige Campbell is the president and leader of Grady Britton. As the head of one of Portland’s longest-standing agencies, and the first agency in Portland to become a B Corporation, Paige is equal parts strategist, leader and trusted advisor to her agency and clients.