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How to choose a marketing agency

February 21, 2023
4 Mins

Choosing an agency is a big decision for any business. When you hire an agency to do your marketing you are entrusting them with the future growth of your business. If it works out well they may supercharge your growth, but if you choose the wrong agency it could have the opposite effect, and be a costly mistake. In this post we outline 10 of the key questions you should ask your prospective agency before hiring them.

1. Do they understand my industry ?

You need an agency that understands marketing for your industry. This is because having category knowledge will often speed up their ability to optimise your marketing investment which means faster more efficient growth for you. Most marketing challenges are not unique but consistent in a vertical. An agency with category experience will likely have already seen challenges you are facing and will be able to apply learnings from previous clients with similar problems. Make sure your agency has at least some expertise in your category so they aren't wasting time learning on the job.

2. Do they understand my business?

Although businesses in a category will share similar marketing challenges the business itself will be unique. You business will have a unique vision, a unique selling point, a unique product. Working with an agency that understands that is very important. You need an agency that is very clear on your business so that they make marketing decisions (both strategic and tactical) based on a shared understanding. If they don't understand your business they will make marketing decisions that don't align, creating friction and slowing growth.

3. Do they understand my people?

Cultural fit is very important when selecting an agency. If you are gong to hire an agency it is likely you are going to build a relationship with them, unless it's purely transactional, which it rarely is. You can establish whether there is chemistry very early on in the agency selection process. Often, like any relationship, there is immediate chemistry, but also chemistry can evolve over time. For this reason it is worth spending some time with your agency to see if they have good chemistry with the people they will be working with. Chemistry is important because when things go wrong, which they often do, you will lean on that relationship and ask people to go the extra mile for you.

4. Do they have the right skillsets ?

The most basic question to ask is whether they actually have the right skills to manage your marketing investment. Every marketing plan is different but you should make sure they can cover off all the disciplines, channels and platforms you might need. If you need strategy do they have strategists, if you need Google Ads to they have Google Ads experts, if you need Salesforce CRM experience, do they have Salesforce experts. You want an agency that already has established experts in all the skills you need.

5. Are they the right size for our business?

Agencies vary in size. From tiny boutique agency where the CEO is the account lead, all the way up to agencies that have 1000-2000 people, and everything in between. If you have small budgets then generally you will want to work at an agency that handles smaller clients. If you have small budgets you really do not want to hire a large agency because you will be way down their priority list. On the other hand ideally don't want to represent more than 80% of any agencies revenue. That brings risk. As a rule of thumb big brands need big agencies, small brands need small agencies. As you grow you may want to switch up the size of your agency to accomodate.

6. What do their clients say about them?

Some of the best insight you will get about an agency is speaking to current clients. A good agency should always be able to give you current references to speak to at the drop of a hat. If they take too long to come up with references or can't come up with any at all, then that is a red flag. Happy clients are usually happy to speak to agency prospects so you should ask to speak to them.

7. What do their staff say about them ?

The differences between agencies in almost always talent. The best agencies attract and retain the best talent. They have high engagement with their staff which motivates them to do great work. And great work leads to better results. It is a people business and you want to choose an agency that looks after it's people because that will usually translate to better results for your business. The CEO will, of course, give you a great pitch, that's her job, but ask to speak with the day to day people to really understand what the agency is like, or refer to one of the industry staff surveys to see how they score.

8. What is their talent churn?

Staff churn at an agency is an important number to look at because high staff churn means you will have high turnover on your account team. And high turnover on your account means invariably slower growth as new people take time to learn your business. Staff churn (the number of people that leave each year and need to be replaced) is 33% on average in the UK. If you find an agency below 10% churn thats good, 10%-35% is ok, above 35% you shoudl think twice.

9. Do their ways of working suit ours?

Different agencies have different operating models and ways of working so you want to find one that will suit how you want to work. At a most basic level this involves things like how you communicate. Some businesses prefer Slack, some prefer Microsoft Teams for example. More advanced considerations are things like structure: do they have an org design centred around channels or organised around client teams. As a rule you want to work with an agency that can mirror your ways of working and structure for optimal results.

10.Does their cost match our budget ?

You should only hire an agency if you your budget aligns broadly with their fees. You want an agency to be motivated to invest time and money into your business but you also want to get good value for money. You should choose an agency that is comfortable working within your budget. If they are not then it really is likely to be a poor working relationship - you may convince them to work with you but ultimately they won't be able to afford good talent and that will hurt your marketing performance at some point.

If an agency fails on any of these 10 questions, that should be a red flag. Make sure you have good answers to these 10 questions before hiring your agency and you will reduce the risk of things going wrong.

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