Agency Business Model

Posted July 9, 2020 by  ‐ 4 min read

Move marketing dollars away from tech into better marketing campaigns by leveraging technical platforms.

I want to criticize the business model of small to mid sized marketing agencies from a technical and strategic point-of-view. My motivation is simple, my partner works in marketing. I’ve seen my partner go through so much unnecessary pain. The margins of agency life are small and the end product is usually subpar. I’ve seen how money is wasted and mismanaged on these projects. This results in unhappy clients getting subpar branding efforts. Nobody wins.

About me

I think you should know a little about me before we continue. I’ve been a software developer for twenty years. I co-owned a healthcare start-up in the early 2000s. After that, I worked with big names NBA, CNN, PGA, and WebMD among others. I then switched my focus to start-ups and consulting. I started a consultancy which advised businesses on technical projects for years. Currently, I’m building the next big collaboration platform for businesses at a well funded start-up. During this time I specialized on improving engineering practices, mobile and web application architecture, and software at scale. I have a good idea about how the doughnuts are made.

The problem

When you’re paying for SEO experts and developers then that’s money not going to branding, storytelling, creative, unique approaches, and quality content. Agencies wasting time, money, and most importantly the client’s opportunity to inspire.

For years, marketing agencies have been trying to game search engines through trickery. In the early years, it was all about keyword stuffing and that has continued to evolve over the years. In fact, there is a whole list of bad practices peddled by so called SEO “experts”. Simultaneously, developers have been pushing their favorite technical stack. These solutions invariably need to maintenance, costing billable hours. Snake oil friends, it is a load of B.S.

A better business model for marketing agencies

  1. Content is king - The value of a website is in its ability to capture an audience by telling a compelling story that adds real value. We all know about information overload. You are competing with everyone for a person’s attention: local/regional/global ads campaigns, text messages, full inboxes, mobile notifications, Facebook, Instagram, Twitter, News, Amazon, etc. Everyone has something to say. What makes your strategy stand out in a world full of noise? Meanwhile, clients know their business but struggle to communicate it in a compelling way. That’s where the real opportunity lives, it’s creative branding.
  2. Website development is dead - The internet has new tools which make building websites a cinch. I’m looking at you Wix and Squarespace. It’s now possible to roll out a website, generate a logo, use beautiful templates and stock photography, blogs, paid search, email campaigns, and online stores without any technical expertise whatsoever. No longer is it Wordpress, now it’s drag and drop web design. And get this, you can do all that for less than $50 a month. Moreover, these platforms are improving.
  3. SEO is dead - SEO’s value is in it’s ability for real people to find your content. Here’s the rub: search engines have gotten really good at indexing websites over the years. Google is able to find and index your content without much help. Website builder platforms come with SEO out of the box. Take a look at Wix and Squarespace SEO pages as examples. Here’s a short blurb from Squarespace, “All Squarespace sites are built for clean indexing by search engines” and from Wix, “SEO Features Built-in to Your Wix Website”
  4. Spend little to nothing on SEO and development - Spend everything on branding and strategy. Here’s my advice: connect with an agency who understands this. Think through your message with them. Form your message into a compelling story. You’ll have a much better chance at succeeding where others have failed or limped along. How many dull websites have you visited? How many annoying sites have you seen? How many redundant sites exist in the world? Where is the sparkle, the inspiration? Focus on where your value truly lives.
  5. Do tech optimization on the backend - Social proof is important. You need sites to link to you. You need traffic coming from all over. But and it’s a big but, you need traffic that is motivated by people who are inspired by you. You need to be purposeful. Technology matters but it’s also largely ubiquitous. Going viral doesn’t come from tech optimization, it comes from inspiration, it comes from… thinking… thinking… eureka!

If you are looking to build a website then I hope this improves your filter for deciding what agencies and people to hire. If you are an agency and this is news to you then it’s time for some big changes. Maybe your agency is stuck in what has worked but I hope this will nudge you in a better direction.

Bottom line: Leverage web platforms so that you can invest in branding and quality content.