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Research & Strategy for Digital Agencies

The latest research, insights, tools, and resources that make managing a digital shop easier,

Featured Post

Assessing Agency Fragility

TL;DR It isn't easy to tell when an agency's running hot, but we can get a sense of how fragile an agency is with a few key metrics: Utilization: Track it closely; pushing over 90% can turn small problems into big ones, especially in consultancy-style agencies. OpEx/Adjusted Revenue: Keep support expenses in check. Below 20% is lean, above 35-40% burns margin. Cash Reserves: Aim for a few months of OpEx on hand. Your tolerance for risk will guide the exact number. Sales & Marketing...

TL;DR Leadership teams need to know and appreciate the work other departments do. This knowledge and appreciation unlock the ability to be proactive. Knowing what others are working on is easy, but appreciating their work is difficult. Acquihires are great for solving this. Owners should actively manage their leadership team by instituting: cross-functional workshops, leadership retreats, joint goal setting, transparent reporting, and individual check-ins. Another Promethean capacity update:...

TL;DR There are real risks to specializing a digital agency in a narrow niche. Agencies exist because most in-house teams live further down the adoption curve, but that curve shifts, and commoditization can arrive faster than planned for. Building your business on a singular platform or vendor puts you at their mercy for better or worse. We just published a PR Brief on the latest WordPress situation specifically about this. Industries can shift quickly and relying on a specific trend to grow...

TL;DR What the hell is WordPress doing? Take our <5min survey and let us know how the WP vs. WP Engine nonsense is impacting your shop. Many digital agencies have dismal or non-existent support between sales, marketing, and account management. (especially at the big agencies) When you get above 50-ish FTEs and are competing with bigger shops, you have to get more sophisticated on the revgen front. Cross-functional collaboration is a major way to improve your revgen game. Sales can support...

TL;DR Engagement: I’m planning out the 2025 research calendar now, and I’d love to hear about what you’d like to learn next year. Drop a comment to appease the algo gods, and give me some feedback on next year’s agency research! Referrals can drive massive agency growth, but it requires intentionality. AM is better positioned to ask for referrals than Sales, so have them own it. Sales should prioritize qualifying referral leads (they close faster). Bizdev should facilitate referral programs...

TL;DR Webinar: We're doing a webinar on Wednesday the 18th on agency tools and how they evolve as shops grow. Join us live, or register to watch the webinar later. New Research: The Digital Agency Webdev Trend Report: 2024 A free report on how agency webdev and design are shifting in light of everything that's been happening lately (AI). New Service: I'm testing a new research service for digital agencies around market sizing, industry research, ICP development, and buyer committee...

TL;DR Many agencies go through a kind of boom-and-bust cadence where leaders need to periodically jump in and reignite leadgen and sales. The boom-bust cycle many agencies endure makes it challenging to forecast, wreaks havoc on morale, and forces shops to hold a bigger cash/credit buffer than they’d otherwise need. There are multiple paths to stability, and they can include things like: consistent leadgen, account management expertise, increasing revgen velocity, growing your agency,...

TL;DR Share the Agency Web Dev / Design Survey with your team's devs and designers and get access to the full report when it's live! An agency’s ability to reliably generate new leads has a waterfall effect on just about every other aspect of running a shop. The more effective your leadgen is, the faster you’ll be able to grow. Knowing your level of leadgen today unlocks your ability to accurately forecast tomorrow. Any misstep in leadgen flows right to forecasting, which translates to poor...

TL;DR NEW SURVEY OPPORTUNITY: Agency Web Dev/Design Survey! This one's for your devs and designers to take. UPDATED RESEARCH: Digital Agency Industry Report We’ve updated our Digital Agency Industry Report with the latest data on digital shops. Since 2015, digital agencies have grown at an average rate of 13% and earned an average net margin of 15%. We have room for two Revgen Reviews in September. If you’d like help dialing in your agency’s revgen strategy, let’s chat. NEW SURVEY...

TL;DR We're soft launching a one-stop shop for all your digital agency research needs! Use code PRNEWSLAUNCH for $95 off. New Research: Bending, Not Breaking: The State of Digital Services 2024 Agency growth was worse than expected in 2023 (4.5%), and our expectations were low. Some shops still managed to grow at rates 2-3x above average. Those fast-growing shops did some similar things: They readjusted their service mixes, specialized by industry and service mix, raised rates, served a more...