Why Chasing Growth Can Wreck Your Agency's Profitability, with Eric Brown

Very cool.

And you're-- I feel like you're coming in at the right time with this kind of an, an offering because [chuckles] the last few years have been a bit rough, uh, for a lot of agencies, especially, like, the last, I'll say, year or two.

Um, and it's ...

Y- there's lots of reasons for that.

Um, but usually when we're trying to diagnose, well, what's going on? What can you do to fix it? A lot of the times, um, the culprit is we don't have enough work.

We don't have enough, you know, business in the pipeline, whether that's to maintain what they currently have, and we'll talk about that later, uh, or to, to grow the business at all.

So, um, yeah, let's just dive right into that.

Um, I see it all over the place.

So many agencies are struggling with it.

Um, you know, what, what do we do about that?

Yeah.

It's a great question, Carson, and I, I think, um, my belief is that it has to start with agencies choosing to own growth as a function within the agency.

You know, we, we talk about, um, planning, installing growth operations for, for agencies, for agency leadership, because candidly, most agencies are not started because of a, an expertise in growth.

It's not where they came from, uh, it's not what they wanna do, uh, it's not, um, the, it's not natural for, for most of the team.

And the irony is, uh, many agency owners came from shops in which, based on their skill set, they kind of had work dropped on their desk.

And so when they took their skill set out to run another agency, they oftentimes left with, you know, maybe a piece of business or two, uh, and some relationships that have enabled them to grow.

Uh, and the, you know, kind of the, the stereotype or the common story is, you know, agency skill set leaves, starts their own agency.

They bring that piece of business, uh, some relationships.

They grow to several million dollars, uh, if not five or seven million dollars over three to five years, and that's when th- we, we start to see some friction.

And the friction there is most commonly, um, they've picked all of the low-hanging fruit off the tree, and that low-hanging fruit is the relationships, and, like, the relationships that they, um, that they have, that they can access, that they can, um, transfer into to revenue, whether that was you kind of, uh, you know, un- unsold relationships or, uh, tracking somebody from, from brand A to brand B and, and, and picking up business there.

And all the meanwhile, uh, costs are, are rising.

I know we'll, we'll talk about that a little bit more, uh, later, Carson, uh, when we, we talk about profit and, and margins and that sort of thing.

Uh, but again, so when we get back to the, the reality that growth is not a function within, within agencies.

It's not, it's not a, a common skill set.

It's not, uh, what we understand or know or again, want to do.