How to Scale Your Agency - Tip #1 of 15)
David Rodnitzky
Agency Growth and M&A Advisor/Coach. Grew 3Q Digital from a coffee shop to over 300 people and $2B/yr of media under management. Led M&A transactions totaling more than $500M.
Editor's Note: This article was originally posted in the new and exciting Agentic Shift newsletter. Subscribers got this post last week! For the next few weeks, I'll continue to share content on both my newsletter and LinkedIn but after that, I'll only be posting on the newsletter. So if you want to get all 15 parts of this epic list, you should sign up for The Agentic Shift newsletter right now!
I talk to a lot of young marketing agency founders. Inevitably, the first question they ask is: how did you do it? How did you go from one person in a coffee shop to a 500+ person global agency?
The short answer is: It’s better to be lucky than good! I’m only half-joking here: any successful founder who thinks that his success was all because of his innate genius and cunning strategy and not in large part due to good fortune is deceiving himself.
That said, I can look back on my agency career and in hindsight point to decisions I made that contributed to the rapid growth of 3Q Digital.
I have noticed that there is an entire industry of consultants/coaches/courses/masterminds that claim to know valuable secrets about agency growth. Just pay them tens of thousands of dollars a year (and sometimes, a month) and you’ll soon be on top!
I think the path to agency success is pretty straightforward. But, as we all know, success is all in the details, and simply knowing how to do something is irrelevant if you don’t actual go forth and do it.
With that said, over the next several newsletters, I’ll share my perspective on how to grow your agency, based on my experience in growing 3Q Digital. In total, there are 15 tips:
For this first edition, I’m including two tips for the price of one (though you’re getting this newsletter for free anyway . . .).
Tip #1: People
To build a successful agency, you need to master PPC, which in this case means “People, Process, and Culture." In this newsletter, we’ll focus on the two of these - people and process.
Agencies are “human capital” businesses, meaning that success or failure is determined by the agency staff. Great agency employees have three types of intelligence: IQ, EQ, and XQ. IQ is raw brain power, EQ (Emotional Intelligence) is the ability to work well with others, and XQ is “execution intelligence” - the ability to deliver great results. By the way, if you’ve ever wonder what 3Q stands for, you just got the answer - IQ + EQ + XQ.
So how do you hire people with the three Qs? Successful agencies “hire slow, and fire fast.”
When I hired people at 3Q, I looked for all of these traits and asked myself two questions: 1) Is this person better at one or more of the “Qs” than I am? and 2) Is this person an entrepreneur who will someone want to run their own agency?
I wanted to hire people that had talents that I didn’t. This could mean that they were advanced math geniuses (one of our first hires was a high school math teacher with zero experience in online marketing), or a people-person who could built rapport with anyone, or a detail-oriented operator who loved process and efficiency (definitely not my strong-suit).
And, I wanted people on the team who acted like it was their business (and as if the client’s money was their money). People with an entrepreneurial mindset solve tough problems, work hard, and innovate to make the business better.
Once hired, I pushed the team to be relentless about promoting A players and firing B players. I encouraged my team leaders to ask one question about each of their staff: “If this person resigned today, would you be panicked, ambivalent, or relieved?” Any team member who didn’t fall into the “panicked” category was given a generous severance package.
领英推荐
Every hire is a representative of your agency. Agency growth can only occur by hiring people more talented than you and quickly firing those that don’t meet your agency’s high standards.
Tip #2: Process
An agency without process is just a bunch of smart people running around doing smart things.
Imagine going to McDonalds and ordering a Big Mac. When you unwrap it, you see that there are two beef patties, some lettuce, a tomato and sauce (and of course, it comes on a sesame seed bun).
A few days later, you travel to a different McDonalds across town. When you unwrap a Big Mac at this location, you get three beef patties, no tomato, a mountain of olives, and rye bread instead of a bun.
This, of course, is a ridiculous scenario. We all know that the ingredients of a Big Mac are going to be the same everywhere. And this is because McDonalds has refined its process for making Big Macs over decades to ensure a consistent consumer experience. This includes ingredients, the appearance of stores, pricing, menu choices, the actual food, and so on.
Now think about your agency. If you picked three of your account members and separated them into three rooms, and then asked them basic questions about how things are done at your agency, would you get the same answer or would you get very intelligent but totally different answers?
Most agencies don’t have consistent process. This includes somewhat banal elements of the business, like how reports are structured and presented to clients, to the meat of what an agency is hired for - campaign management and optimization.
If a client asked three of your account managers “how do you structure your Google Ads accounts” and then got three totally different answers, you don’t have an agency - at least one that can scale - you have a bunch of smart people running around trying to do smart things.
Moreover, by not having process, you are also condemning your staff to reinvent the wheel over and over again. Process allows smart people to spend their time on complicated challenges, rather than the basics.
At 3Q, we invented several processes that we required account managers to implement across all accounts. The most well-known was the Alpha Beta Account Structure - which I’ll discuss in a subsequent email.
These processes not only allowed scale to happen, they were also great sales tactics. When pitching a potential client, I’d often challenge the client to do the experiment above: take three of my account managers and three account managers from another agency, separate them, and ask them questions about their campaign management methodology. Few clients actually took me up on this offer, but they got the point and we won the business.
Up Next: Culture
Next week, we’ll talk about culture and how a great culture can be rocket fuel for agency growth.
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I help scale businesses by targeting the 90% of missed opportunities
1 年Great insights as usual mate ??