THE PROFITABLE AGENCY [INBOUND 2014]

#INBOUND14

the profitable agencyhow to a*ract, retain and grow a profitable client base

sept. 16, 2014

presented by paul roetzer (@paulroetzer) CEO | PR 20/20

of marketers think markeEng has changed more in the past two years than the past 50 !source: Adobe Digital Distress

76%@paulroetzer www.pr2020.com#inbound14

http://blogs.adobe.com/conversations/2013/09/digital-distress-what-keeps-marketers-up-at-night.html

the consumer is the true change catalyst

@paulroetzer www.pr2020.com#inbound14

90% of daily media interac;ons are screen basedsource: Google, The New MulE-‐Screen World

@paulroetzer

http://www.thinkwithgoogle.com/research-studies/the-new-multi-screen-world-study.html

B2B buyers may be

up to 90% through their journey before contacEng a vendor. !source: Forrester

image: Jayneandd


http://blogs.forrester.com/lori_wizdo/12-10-04-buyer_behavior_helps_b2b_marketers_guide_the_buyers_journey

http://www.flickr.com/photos/jayneandd/4450623309/

Source: Google

Every trackable consumer acEon creates a data point, and every data point tells a piece of the customer's story


http://www.google.com/think/tools/customer-journey-to-online-purchase.html

Source: Chiefmartech.com

the customer journey does not follow a linear path defined by marketers


http://chiefmartec.com/2013/09/fire-funnel-5-stages-real-buyers-journey/

Define FoundaEon Projects

blog posts podcasts website video email

webinars mobile apps

tailored markeEng through a deep understanding of buyer persona needs + the ability to deliver personalized messages

Image: HubSpot

we have entered the age content, context and the customer experience



create more value, for more people, more oDen, so when it’s Eme to choose,

they choose you

new marketing imperative

what’s holding businesses back from achieving performance poten;al?

image: Xurxo Marcnez

talent gap + tech gap + strategy gap = PERFORMANCE gap


http://www.flickr.com/photos/73637077@N00/26908009/in/photolist-3nUPc-3t6Ce-5BDXU-5PC7G-7bzyV-7moKx-7rU2Y-7xx6R-7WRbY-9Bt34-aES22-aES2P-aES3U-aES5i-b3sdy-c1Nqu-cxL8g-d6aQ9-frqgX-gJaHD-hmAi3-k4LLr-nrkpz-pSmfo-pYgMi-tcCp3-tU3US-ugMD9-yUFZ4-zBEJt-A5YF1-AYTc7-DgKU7-EBgwP-GaSsD-JKPgd-KUAFN-LpJK8-LtwcP-LTYHz-N11wV-Rm4AZ-S2VLM-W9mpz-29edYK-2QhDYU-2TNT7K-338R2h-42ZssZ-46EY26-47DCzD

of marketers say their lack of skills is impacEng revenue in some way !source: 2012 MarkeEng Skills Gap Report


http://blog.eloqua.com/marketing-skills-gap/

of companies lack necessary digital skills in key areas of social media, mobile, internal social networks, process automaEon, and performance monitoring and analysis. !source: Capgemini ConsulEng


http://ebooks.capgemini-consulting.com/The-Digital-Talent-Gap/index.html

a talent war has begun

for tech-‐savvy, hybrid marketers

capable of building, managing and execu/ng

fully integrated campaigns that produce results


agile, adept at advanced marke;ng tech, and experts in inbound strategy


how do we find the unicorns?

@paulroetzer

only 1 of the top 10 markeEng programs in the U.S. has a required undergraduate

digital marke;ng course

source: U.S. News & World Reportimage: IUB Facebook

http://colleges.usnews.rankingsandreviews.com/best-colleges/rankings/business-marketing

https://www.facebook.com/IndianaUniversity/photos/a.10152613618624595.1073741852.54210104594/10152613618724595/?type=3&theater

businesses must take the ini;a;ve to mold their own modern marketers


by 2017, the CMO will spend more on IT than the CIO. !

source: Gartner

IT = CIO CMO


http://www.forbes.com/sites/lisaarthur/2012/02/08/five-years-from-now-cmos-will-spend-more-on-it-than-cios-do/

6 classes, 43 categories, 947 companies

ExactTarget IPO (Mar '12)

Eloqua IPO (Aug '12)

ExactTarget buys Pardot (Oct '12)

HubSpot raises (Nov '12)

Oracle buys Eloqua (Dec '12)

Marketo IPO (May '13)

SF buys ExactTarget (Jun '13)

0 5 10 15 20 25

$161.5M

$92 M

$95.5M

$100 M

$871 M

$79 M

$2.5 B

venture funding, mergers, acquisiEons and IPOs fuel the martech industry


analyEcs automaEon coding content digital ads email mobile public relaEons search social tech websource: AlEmeter’s The Converged Media ImperaEve

the new marke;ng mix


http://www.slideshare.net/Altimeter/the-converged-media-imperative

http://www.slideshare.net/Altimeter/the-converged-media-imperative

generate leads86%

85% convert sales

build brand46%

51% increase loyalty

brand

leads

sales

loyalty

Source: PR 20/20’s 2014 MarkeAng Score Report

high-‐priority goals

@paulroetzer www.pr2020.com

sample KPIs

website traffic social reach subscribers

lead volume lead quality score

lead-‐to-‐sale conversion rates cost of customer acquisi;on (COCA)

customer life;me value (CLV) customer reten;on rates recurring revenue

brand

leads

sales

loyalty


source: Accenture’s Turbulence for the CMO

the markeEng industry is moving too fast to internalize everything

http://www.accenture.com/us-en/Pages/insight-turbulence-cmo-summary.aspx

Donovan Neale-‐May, ExecuEve Director, CMO Council

“There’s an underlying level of frustra;on among senior corporate marketers worldwide when it comes to agency contribu;ons to business value creaEon, strategic thinking, and digital markeEng development.”

source: CMO Council (2012)


http://www.cmocouncil.org/press-detail.php?id=2943

of senior marketers believe tradi;onal ad agencies are doing a good job of evolving and extending their service capabiliEes in the digital age. !

source: The Chief MarkeAng (CMO) Council report More Gain, Less Strain.


http://cmocouncil.org/

http://cmocouncil.org/press-detail.php?id=2943

where do the other 91% turn for help?


growth is the easy part. retaining it, and making it profitable, are the real challenges for agencies.


a cauEonary tale of churn

Define FoundaEon ProjectsPR 20/20 growth (2009)

15 new campaign clients !

$195,000 in 2009 revenue !

$503,000 in 2010 forecasts

life is good!

0 clients remain

average relaAonship lasted 12 months

49% of marketers report they will consolidate or change agencies over the next 12 months. Another 15% aren’t sure. !source: CMO Council, 2012 study


Define FoundaEon Projectschurn factors

financial instability focus on outputs, not outcomes over promise, under deliver siloed services stagnant business model stretched too thin talent turnover unbalanced porqolio weak processes

agency side


Define FoundaEon Projectschurn factors

client side

conservaEve culture/budgets financial instability lack of vision low quality product/service markeEng tech deficiencies personnel weaknesses poor management unrealisEc expectaEons weak foundaEon


work with agency partners that care as much about

performance and success as you do


15 ways to maximize agency profits

Source: HubSpot

1) prove performance


http://knowledge.hubspot.com/getting-started-with-hubspot/how-to-analyze-a-campaign-in-hubspot


2) develop scalable processes and services.

3) reduce business development Eme.

(remove despera/on)

4) achieve financial stability.


5) know when to say NO.

commit to clients and prospects who value your people, ;me and energy !

watch for red flags !

trust your ins;nct !

be willing to walk away

6) get paid for planning.


2006

2008

2010

2014

7) establish value-‐based pricing.

@paulroetzer

8) build brand and reputaEon.

image: David Guo

Senior Pro @ $75,000 = $32/hour vs.

Junior Pro @ $45,000 = $19/hour

costs 40% less for junior pro services

9) understand service-‐delivery costs.


https://www.flickr.com/photos/76969036@N02/7612995834

10) arract and nurture entry-‐level talent.


11) move to campaign-‐based contracts.


image: Xurxo Marcnez

12) fill talent, tech and strategy gaps.


http://www.flickr.com/photos/73637077@N00/26908009/in/photolist-3nUPc-3t6Ce-5BDXU-5PC7G-7bzyV-7moKx-7rU2Y-7xx6R-7WRbY-9Bt34-aES22-aES2P-aES3U-aES5i-b3sdy-c1Nqu-cxL8g-d6aQ9-frqgX-gJaHD-hmAi3-k4LLr-nrkpz-pSmfo-pYgMi-tcCp3-tU3US-ugMD9-yUFZ4-zBEJt-A5YF1-AYTc7-DgKU7-EBgwP-GaSsD-JKPgd-KUAFN-LpJK8-LtwcP-LTYHz-N11wV-Rm4AZ-S2VLM-W9mpz-29edYK-2QhDYU-2TNT7K-338R2h-42ZssZ-46EY26-47DCzD

(eliminate waste)

13) track ;me and efficiency.

14) focus on reten;on.


Speaking 5%

Publishing 5%

Events 10%

Sofware 10%

Services 70%

15) diversify revenue.


paul roetzer, @paulroetzer !CEO | PR 20/20 author | The MarkeAng Performance Blueprint (Wiley, 2014) & The MarkeAng Agency Blueprint (Wiley, 2012) creator | MarkeEng Score & MarkeEng Agency Insider

www.pr2020.com

THE PROFITABLE AGENCY [INBOUND 2014]

Marketing

Transcript of THE PROFITABLE AGENCY [INBOUND 2014]