Scaling Up an Agency through Specialization

Most marketing agencies out there take any work that they can get when they’re starting up, but then get more selective when they start to scale. They start to weed out customers by size: not taking the ones that are too small to work with, and also not bidding on anything that’s way too large of a scale. They also choose to perform more of the services that they’re good at and are profitable and choose not to do services that they can’t make a profit off. In our experience, most agencies stop here and don’t take specialization far enough. In fact, many agencies inadvertently become specialized in geography: marketing for their own location. They remain stuck in limbo: not able to specialize enough to grow world-class expertise in any service lanes, and continually adding and losing industry knowledge when their people get hired away. There are 2 separate ways that most digital marketing agencies can specialize to scale:

  • Specialize based on industry focus
  • Specialize based on service focus

Specializing your Agency by Industry Focus

Ever work on a project with a fellow marketer who has mastered the industry the same as you have? It’s refreshing: bad ideas come up less often, industry tropes are well known, common client pitfalls are carefully avoided, and everyone knows what works. But then later that same day, you work on another client in another industry that only you have experience in. Now you have to drag the team along and spoon-feed all the industry knowledge that you have. You have to have eyes on all deliverables and guide every little deliverable with the minutia that you understand.

Specializing Based  On Industry = Client Wins

Agencies that focus on a specific industry segment frequently outperform general purpose agencies because they have that deep-seated industry knowledge spread throughout the agency. If you’ve been in a general purpose agency, you’ve probably lost clients to specialized agencies in the past before. Your clients see the allure of going with an agency that knows them and can speak their language. Yes, there’s the worry of exclusivity that comes up but for some clients, it’s worth the risk. By specializing based on industry, your account people get to know the industry as well and increase their close rate.

Specializing Based On Industry = More Predictable Scale

Agencies that are specialized based on industry understand their growth scaling very well. They know that at 20 retainers, they need 2 designers, 1 SEO, 1 PM, 1 PPC, and 1 developer, and they know what trigger points they have to hire. It’s very different than hiring for feast or famine conditions in most agencies. Specializing based on industry type also allows for a more repeatable sales process. You’re not jumping from blue-collar CEOs to responding to government RFPs, to engaging with VPs of Marketing from large corporations. You learn a lot more about your target persona and can really hone in your sales and marketing messaging to speak to that persona.

Specializing your Agency by Service Focus

It’s hard to get national or global recognition when you dabble in service lanes. Some agencies get to the point where they do 1 thing great and they want to spend all their time doing that thing. There are a few great things that happen when your agency specializes in a service:

  • It becomes easier to be well known since you’re focusing on 1 service
  • Every time you speak at a conference, it’s on that service
  • Your content marketing becomes focused on that service
  • Because you’re an expert at something most people aren’t, you can get more national and global coverage
  • Other agencies work with you. Since you don’t compete with their other services, they’re more likely to collaborate and shop work out to you since you’re the expert.
  • Bigger companies that have internal marketing teams work with you. Since they can’t afford to get their internal teams to be experts on your service lane, they work with you. You get exposed to new levels of great in-house marketing teams.

If your agency has an industry vertical that you want to target, consider starting a brand & allocating team members to focus on that vertical. ActiveDEMAND works great as digital marketing agency software when you need to specialize and market at scale.

Examine your customer verticals: which of your client industries have you had the best success in the past? Wouldn’t life be grand to just work in that industry exclusively? Don’t wait, start specializing your agency today!