Is my business really workable?
Written By wrttnwrd on Feb. 5, 2008.
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First, I want to qualify this all: I am not a newbie at running a company. I started this company in 1995. I grew it from nothing, without any help from investors or banks.
Now, it's a 30-person marketing agency, with 32 clients.
I've now had my 4th account manager quit in as many months. We fired another 5 months ago.
I can't seem to build a team that can serve clients, no matter what I try. I've written a step-by-step manual for how we do internet marketing, teach a weekly class, keep my staff to 40-50 hour weeks, pay well, demand excellence and deliver for all of our clients.
But I can't seem to get us over the hump: I am still dragged into meetings with irate clients, or see folks losing their grip on deadlines, etc.. Plus, our margins are razor-thin. We're profitable (we have no choice), but only just.
Do I have too many clients? Too many staff?
When do you just say 'screw it'? I feel like I've built something with real strength, but it's started to suck the life out of me.

Tyme
Written Feb. 5, 2008 / Report /
First, are you getting past the storming team stage? It's sort of inevitable but is dependent on the response. :)
As an example, the guys and I went through our storming stage. We each have very strong personalities and we had to find our groove. Just like in any relationship one doesn't really know if there is a true bond until the individuals involved go through tough times and come out of it stronger, the same goes with teams. Storming is the natural healthy stage for team dynamics, the solid teams survive, the weak ones don't. We survived, stronger than ever, kicking ass on new things.
Due to the short time period you describe I wonder if you've gone through the storming period. Employees don't just "obey". When you say "demand excellence" are you setting too high of a standard?
wrttnwrd
Written Feb. 5, 2008 / Report /
We've all worked together (the management team anyway) since 2000. So I think we're past that, yes.
Staff are another issue, of course. I'd say the creative and technical staff are brilliant, and do amazing work. So do the marketing team. It's the account management team that's a headache.
I think I've answered my own question. We earn 2/3 of what other agencies do, from 4x as many clients.
Tyme
Written Feb. 5, 2008 / Report /
You said you can't build a team that can serve clients so I was talking about that team...but you seemed to have answered your own question lol. Congrats. :)
Ozone42
Written Feb. 5, 2008 / Report /
Account Management == Sales, right?
No offense to all the sales people here, but salesmen tend to be assholes. It's not a rule, just a generalization. I constantly deal with the type that promises things they can't deliver, makes excuses when those things aren't delivered, and don't communicate well back to the people actually DOING the delivering... further compounding the problem. Of course that makes irate clients, and stressed production staff.
Does that sound familiar? Are those some of the reasons you fired one a while back?
I unfortunately don't have a solution for that particular problem. I know there's great sales people out there, I've met several, and worked with a few, but I really feel they are one in a million.
The other side of the problem that you just mentioned:
I think that's the crux of it. Your pricing is obviously low, which is attracting people that other agencies would not go after. There's a reason they don't go after them, and it's not only the money! Some clients are more trouble than they are worth.
I'd suggest adding another tier of service. One that's priced more like your competitors. Since you've been around several years and have work to show, it should be easier to get some of the bigger clients willing to pay more--not easy, but easier than it was starting out. For the existing clients and the lower tier, it's crucial to make things black and white. So they know what they're getting, when, for how much and that your staff can deliver exactly that. If there are going to be delays, the sooner they're revealed the better and more likely clients are to be forgiving.
I'm sure I'm not telling you anything you don't already know. You're a smart person. Have you looked at your internal processes and workflows to see where problems are creeping up? Not just internally, but problems perceived by the clients (real or not?)
wrttnwrd
Written Feb. 5, 2008 / Report /
Yah. I think after 13 years, I'm too close to it.
The account managers here are strictly marketing consultants for the clients. They manage the projects and give guidance. No sales.
But a big problem is finding folks who can really think like marketers. It's not that common.
fuscom
Written Feb. 6, 2008 / Report /
You run an ad agency, right? I've worked in the ad business and with account managers, and like you, have been around the block a few times.
From my experience with agencies, I've found that most account managers are highly driven, self absorbed divas which will promise a client all kinds of things without consulting the creative department once, to even see if what they're promising is even technically or financially feasible.
It's just all about the draw.
For the small agency I worked for, the owner sounded a lot like you describe yourself -- stressing in every Monday morning staff the how, when, why and how of handling accounts. He didn't do it in an effort to be a know-it-all by any measure, in fact, he was an easy to get along with, grandpa type guy who cared about deeply his employees and his clients.
But, I think that was the major issue -- he was holding on too tight.
As Ozone has suggested, I too think you have a two-edged situation to deal with. First, I would suggest you back off on the step-by-step manuals and training sessions. Doing all this, I believe, in some ways makes you accountable to them, you need to reverse that.
Secondly, I too think you have a disconnect between the dreams of glory by your marketing people, and your actual clientelle. Maybe it's time to look at some of your clients and see which ones need to go. It could be that the pruning of the vine might be the move you need to motivate the marketing staff.
Finally, if you're not already, I would have your creative and marketing folks have regular meetings -- without you or any administrative people in attendance. Let your creatives sit in on and take a role in the account meetings. Encourage your marketing folks to listen to and appreciate what kind of effort it takes to deliver a client vision creatively speaking.
I've worked on all sides of the agency fence, and I still stand in disbelief how little communication goes on between creative and marketing, technology and creatives, marketing and administration...
Perhaps it might be worth your while to get a business analyst who understands all aspects of your business, to bridget the communication gap.
Of course, I state all this from my experiences in the industry, not the assumption that you are or are not doing any of this already.
Tyme
Written Feb. 6, 2008 / Report /
Knowing more about the situation (and what you do) that was what I was going to suggest. You have a couple of problems that hinders your growth and you are close to the situation. A neutral opinion from a business analyst familiar with what you do and where should be for industry standards for your area can bring you a fresh outlook.
Ozone42
Written Feb. 6, 2008 / Report /
I'd temper that last bit of advice. Don't get someone who understands all aspects of your business--you do that already! If you have a problem being too close, you want ideas from outside your normal comfort zone!
A smart neophyte, even if some of the ideas are just way off base, will probably do a lot better making you think and re-think things than a seasoned pro in the field. Explain the problem to a friend that isn't in your field, you may come to new ideas simply explaining it. Your friend may offer some wacky advice that is completely obvious, but you're missing it.
Tyme
Written Feb. 6, 2008 / Report /
@Ozone42: I meant a professional. Someone who is experienced in these types of issues. They have a neutral position but also have the knowledge to guide in the right direction for growth. I had several clients use a specialist and they did not necessarily go with all the idea but it gave them a fresh perspective and leads on how to find the right people for the tasks at hand.
Opinions from friends are cool but I guess when it comes to major changes I lean towards a professional outside opinion...if that makes sense lol.
Ozone42
Written Feb. 6, 2008 / Report /
My main gripe is that most people claiming to be professionals these days are anything but.
wrttnwrd
Written Feb. 7, 2008 / Report /
I have to agree. I've had a few consultants, etc. in on various stuff. Very few seemed to understand the most basic principles of running a business, much less an agency.
Tyme
Written Feb. 7, 2008 / Report /
Not sure who you guys used/encountered but just like in all things, some are good, some a bad. The good ones don't come cheap, unfortunately but they usually come highly recommended., which is perhaps why the people I know that used them had positive results.
wrttnwrd
Written Feb. 10, 2008 / Report /
I think that, bottom line, the best thing you can get is good information, from peers who've been through this all before.
One reason I'm so willing to discuss this stuff here is because I know what a huge difference a bit of advice can make.
seopher
Written Feb. 10, 2008 / Report /
I work for a new media marketing agency too, and this sentence concerned me:
Increase your day-rate. If you've got more clients, up the day-rate you charge. This way the irritating clients who take too much of your time and don't spend enough will leave, allowing you to focus more on new pitches and delivering better work to the ones who stay.
wrttnwrd
Written Feb. 13, 2008 / Report /
Yah, of course. But easier said than done. I've run a lot of numbers around this - we have to bring in bigger, better clients before we ditch the small annoying ones, unless I want to let half my staff go, which I certainly don't.