How Can Agencies Supercharge Profitability in 2022?
The end of the year is a natural point for a bit of introspection. As 2021 comes to a close, what are your recollections of the year? Has it been a bumper, non-stop roller coaster of new clients with different demands, and projects that stretched your team to the limit? Or perhaps you are just happy to have made it through to the end of the year with your client list intact?
It is challenging to remain positive in times of such uncertainty, even though uncertainty seems to have become the norm. Businesses had to tear up their growth plans for 2020 and quickly adapt to new ways of working; 2021 was hardly any different.
But agencies are praised for their agility and flexibility – their ability to scale resources up when needed, pivot direction at the drop of a hat, and to deliver to tight deadlines. By virtue of their flexible culture, agencies were better placed to adapt than many businesses.
However, just because agencies have mostly survived the challenges of the past two years does not mean that they are hitting all the right notes. In fact, many agency leaders out there are worried. Worried that they are losing money from poorly managed projects, losing time on inefficient client management processes, and losing staff to burnout.
Whatever the state of the last year, do you feel positive about the year ahead? How are we going to build on the last year and make 2022 a year of optimism and growth?
After you’ve resolved to make 2022 a great year for your agency, the next piece in the puzzle is to figure out what was holding you back in 2021.
What Winning Agencies Do Differently
Over Summer 2021, 163 UK-based agencies took part in research to help shed some light on vital operational issues that were impacting agency profitability. The results paint a picture of a sector that is not reaching its full potential:
- 67% of agencies felt that their ability to forecast revenue was only ‘somewhat accurate’ or ‘very inaccurate’
- Only 9% of agencies felt that they were maximizing profitability potential
- Over a third of agencies did not measure their billable utilization rate
- Less than a quarter of agencies rated their team morale as 9/10 or 10/10
(Further results and research methodology can be seen in the full report. Get the report now.)
How do agencies adapt and evolve beyond these challenges? Fortunately, none of these issues (even the morale problem) are unsolvable. For example, accurate reporting appeared as a significant roadblock for many agencies, but it doesn’t have to be. Sometimes, just finding the right tool is all that’s needed to solve the challenge.
Many of the digital marketing agencies surveyed felt high-quality, consistent reporting was out of their reach owing to time constraints and difficulties managing data. But often these were the same agencies who were doing things the hard way: corralling and crunching numbers across disparate systems and clunky spreadsheets when they could have been using a dedicated platform that generates insights at the click of a button.
Operational issues can often be ironed out with a deliberate, strategic approach to process improvement. But if that sounds just utterly unmanageable – who has time to analyze the effectiveness of their agency’s processes, right? – don’t worry. There are lots of small, incremental changes you can make to put you on the right track.
Forecast, a project management solution that has been called “the ideal tool for agencies”, partnered with Europe’s leading agency growth consultancy, Cactus, to dig into the results of the research. Their report offers practical, actionable advice that is within the scope of even the most time-pressed agency leader.
Read the report now, and get ready to make 2022 your most profitable year yet.