Experts are sensing a downturn in the economy… But is your agency recession proof? So many variables go into a healthy agency. Maybe you should look at raising agency prices? Maybe your agency really needs to hire (or fire) to make yourself indispensable to clients? If the economy takes a hit, you have to know who to hire, who to fire, and the right way to price your services in order to survive.
In today’s episode, we’ll cover:
I had a great conversation with Scarlett Rosier, Co-founder of Rhyme and Reason Design. Scarlett is one of those “unicorns” who actually went to college and got a Masters in Advertising. (So many of us are accidental agency owners who just fell into the business!) Scarlett is put her skills to work as the Director of Operations at her agency for the past 10 years. She’s here to talk about growing in a down economy, nailing your pricing, and the value in project managers.
How to Recession Proof Your Agency
Worried about a potentially volatile economy? Don’t be! When the market goes down, your agency has an opportunity to go up. Here’s the big secret — in-house marketing teams are usually the first cut.
Cutting the in-house team, therefore, justifies agency costs for your clients. Brands still need marketing in a recession. But, they can usually save money by getting more help externally.
Don’t fear a recession; embrace it. If you survive the recession, you’ll have a bunch of new clients and a reason to raise prices. And you need to raise prices in order to be profitable.
When Should You Raise Your Prices?
The simplest answer is this — whenever you can! You have to be able to justify a price increase with value. So, if your value has gone up over the past year, your prices should too.
Let’s say you’ve hired two new people, learned a ton of tips and tricks, and you’re even better at helping clients this year than you were last year. Your prices should reflect those improvements because your clients are benefitting from them.
I recommend reviewing and raising prices at least once a year. You should constantly be improving, building better processes, learning new techniques and strategies. And that means you’re giving clients more value year-over-year.
Adjust your proposals to match the increased value. Plus, you probably give your employees a yearly raise based on performance, right? Your clients should be giving you one too!
Think about it this way… If you have a heart attack, are you going to use the best surgeon or the cheapest one? Price your agency services to match your skill and you’ll attract the ideal clients instead of the ones who just want a bargain.
A price increase is the fastest and easiest way to grow your agency business.
3 Ways Project Managers Help Retain Clients
Want to know what clients really want? They want relationships and regular communication. They want to feel assured they’ve made the right decision to work with your agency. And that’s where a great PM helps retain clients.
Is Your Agency Business Partner Still the Right Fit?
Business partner relationships can be like a marriage. You rely on each other, and you know the day-to-day struggles the other faces. But, what happens when your marriage evolves or changes?
But also like marriage, business partner “divorce” isn’t easy. And the realization of its necessity something many owners grapple with.
I have a saying — “You either know the bad partner or you are the bad partner.” Sure, sometimes partnerships are successful, but oftentimes I see the partners outgrow each other.
So how do you know when it’s time to part ways with a business partner? It’s all about communication and goals…
Scarlett says to look at how the person argues as an indicator of their communication. Are they articulate? Can they stand their ground intelligently? You don’t need to agree all the time, but being able to disagree effectively is what makes a great partnership.
Rhyme and Reason was initially founded by three partners, but there came a time where one of them had different goals. That’s when Scarlett realized there needed to be a shift in the agency’s leadership. If a partner has career goals that don’t align with yours and with the agency, it may be time to part ways.
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