TL;DR
2025 State of Digital Services SurveyWe’re diving deep into the state of digital agencies to answer all the tough questions about:
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Agency Triage Part Two: Missing DataLast time, we walked through how to run a first-pass triage assessment with benchmarks. But what do you do if your agency doesn’t track those metrics? Having an industry average isn’t really helpful if you don’t have your own internal metrics to check it against. It turns out that the old adage “revenue cures all” is real. It’s typically safe to start with revgen. NOTE: In a triage situation, new revenue must be profitable and contribute to positive cash flow.
It's critical that you're pricing correctly (at least within market averages), your real production costs aren't stupid high (keep them sub 70% of revenue at most), and your payment terms/invoicing/collections give you a reasonable Days Sales Outstanding (DSO), something under 30 (ideally under 15). If any of those are off, adding additional sales will inadvertently cause the agency to fail faster. The reason I say it's typically safe to start with revgen is because these tend to already live in "ok" territory, or they're fixable much faster than a typical sales cycle.
As you’ll see, the order of these is essential. Decisions made early on ripple through the rest. Trying to start at the end leads to a bunch of circular conversations that muddy the process and make it impossible to define a solid direction. ValueValue is a big one. Why do your clients REALLY hire you? What are they buying? It’s not a website. It isn’t technical SEO. And it sure as hell isn’t an elaborate design system. More often than not, it’s security. It’s trust. It’s reliability. Growth, savings, and ROI are in there too, but they’re not differentiators, they’re expected. I don’t believe I’ve ever met a team who can articulate this. Figure out the real value you deliver to clients and make sure your team understands their role in creating it. TEST
ICP / Buying CommitteeWho do you create value for? Building out ICPs and buyer personas can quickly become a performative waste of everyone’s time. Forget all that. Let’s simplify them to what moves the needle. The goal of an ICP is to make it so you can filter the corporate world into a realistic list of targetable accounts. Here’s what matters for an ICP:
The goal of a buying committee is to understand who you’re selling to, what matters to them, and any constraints they face. You need to understand this because different people need to hear different things to break through the inertia that stops us from trying new things and working with new people. Here’s what matters for a buying committee:
Then, for each of those:
TEST
MessageTell them what they want to hear. Most agencies talk about what they do. That’s a mistake. Messaging needs to focus on the value clients get, framed in a way that matters to your buying committee. That’s your core message. There’s an art to copyrighting that can take these to another level, but you can get pretty far (at least far enough to hire that out to a specialist) with just the core message. TEST
ChannelsGo where your people are. The “where they source information” component of the buying committee is just as critical to get right as the pain points. You can have everything else dialed in, but if you’re investing in Bluesky content while trying to sell into the petrochemical industry, you’re fighting an uphill battle. I mean, maybe, I don’t really know where petrochem execs hang out, but I’m guessing it isn’t Bluesky. TEST
Don’t beat yourself up on this one. Peer networks tend to be a key channel for most agencies, and getting into those rooms and conversations can take a lot of work and time. There are also a ton of channels where it's "easy" to show up, but be careful since effort there takes away from effort in more effective channels. TacticsChannel presence is critical, but how you show up in those channels can be just as important. A growth strategy is elegant when the components mesh well and support one another. Growth tactics need to match the ICPs, messages, and channels. As I noted in the channel discussion, peer networks tend to be a key channel for most agencies, so referrals are an example of a tactic that would match well with that channel. Cold outreach doesn't. Beyond matching your tactics with your buyer personas, you also need to take into account your ICP’s firmographics. A good example of this is how different tactics are effective for different-sized accounts. In our How Digital Agencies Grow Report, we found that the efficacy of a number of tactics fell as the size of the target client grew. Furthermore, you’ll use different tactics, channels, and communication mediums for various buyers at various points in the buying journey. Agencies that struggle often jump from tactic to tactic, looking for a silver bullet. Successful agencies focus on a narrow set of effective tactics that align with their buyers, channels, and growth goals. TEST
When You're Missing Metrics, Start With RevgenWhen a shop's in trouble, starting with quality revgen can make a massive difference. It requires a few weeks of introspection. Step back and figure out what’s broken: your value prop, your ICP, your messaging, your tactics, or all of the above. Don't forget the note about new revenue being profitable and cashflow accretive. Once you have that clarity, simplify. Cut what doesn't serve you and double down on what works. A quick note on Promethean's capacity: I'm booked through March for agency strategy engagements. If you'd like a data-backed growth strategy for your agency in the second quarter, let's chat. -Nick |
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