Discover 10 secrets to successful marketing agency ownership and growthBy Lawrence Dy
Agency ownership refers to the managerial and financial control and leadership of a digital marketing business. As owner, you’re ultimately responsible for the agency’s goals and direction, whether the agency is a one-person show or a larger outfit. Agency owners play a key role in the marketing space: without them, clients would largely be left to identify and cobble together the various solutions they require on their own.
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In this blog post, we’ll dig into the different business structures available to agency owners, the responsibilities and challenges of the role of owner, along with 10 agency skills that will help you grow your business.
What does agency ownership look like?
If you’re ready to position yourself at the helm of your digital agency startup, one of your first considerations should be how to structure your business. Let’s take a look at the three main business structures and the key factors to consider when choosing a structure for your agency.
In a sole proprietorship, the business is not legally separate from the proprietor, so the finances, assets, and liabilities of the business are indistinct from those of the proprietor.
This is a common business structure for new, one-person agencies since it’s the easiest and fastest to set up. If you’re considering this structure, keep in mind that all of your profits will be taxed as personal income. Also, if your business faces any legal liabilities, you would be responsible for them.
Similarly to a sole proprietorship, this business structure doesn’t form a new legal entity. Two or more partners put together an agreement detailing the decision-making, profit sharing, and other agency ownership details. Much like a sole proprietorship, the partners are responsible for all debts and liabilities of the agency, and profits are taxed as personal income.
Incorporating your digital agency creates a distinct entity for tax and legal purposes, meaning that your business profits, debts, and liabilities are distinct from your own. Control and decision-making roles are outlined in the articles of incorporation.
By choosing this agency ownership structure, you can protect your personal assets from the liabilities of your agency. You can also keep some profits in the corporation and enjoy a lower corporate tax rate.
While this structure offers the most legal protection and opportunities to minimize taxes, it also comes with greater responsibilities related to annual filing requirements, record-keeping, and maintaining a minute book.
Roles and responsibilities of an agency owner
As the leader of your business, you set the tone for just about everything important at your agency: what you focus on, which clients you target, your company culture, and ultimately, your success. Running a thriving, growing digital marketing agency comes with plenty of responsibility:
- Set the course and guide the direction: As an agency owner, you’re the captain of your ship. You take on the duty of leadership, and key decisions are ultimately your responsibility.
- Assemble and manage your team: Agency ownership is often all about delegating effectively, and that means having a team you can trust to help you build an all-star agency. Effective talent sourcing skills are a must, as is the ability to manage a team, foster their development, and create a culture that helps people thrive.
- Land clients and nurture your relationships: A business is nothing without its customers, and agency ownership is no different. You need a rock-solid client acquisition strategy along with the tools to close and maintain deals.
- Financial management and budgeting: You should create a business plan, including a budget, when you start your agency. But as your business scales, plans will change, and you need to continually manage your real-world cash flow to maximize your profitability.
- Strategize and set goals for the agency: The agency owner is responsible for the ultimate vision for the agency: its long-term goals and the outline for how those goals will be achieved.
Challenges agency owners face in the industry
If you love digital marketing and entrepreneurship, the roles and responsibilities above likely sound exciting to you. But it’s important to be aware of the challenges faced by agency owners in today’s market. Think of them as key difficulties to prepare for.
- Navigate a competitive market: You won’t be the only person selling digital marketing services, and some niches may be downright saturated. Plan for competition by differentiating your marketing agency and getting crystal clear on who your target audience is.
- Maintaining long-term happy clients: Landing a new client is more expensive and resource-demanding than maintaining one, so you’ll need to work continually to make sure you’re exceeding expectations.
- Managing cash flow: Agency ownership comes with a bevy of costs, including staffing and software. Consider ways to minimize these so that you don’t find yourself in the red, such as hiring a white-label digital marketing agency to support your growth.
- Staying on top of trends and new tech: As an agency owner, you need to remain on the leading edge of new technologies and developments in your field, otherwise, you’ll find yourself quickly outpaced by your competitors.
- Maintaining a healthy work-life balance: Entrepreneurship and leadership will place serious demands on your time, and can lead to burnout. Balancing agency ownership with time for other aspects of life, like family, self-care, and social time, is a challenge faced by many in the field.
10 skills every agency owner needs to grow their business
To set your business up for success, you’ll need a digital agency strategy and some well-honed skills. Boosting your aptitude in these areas will help you stand out.
1. Effective communication and negotiation skills
Communication is about getting your point across, but it’s just as much about listening effectively. When meeting or negotiating with clients, avoid going in with a rigid agenda about what you want to sell them. Instead, make sure you understand their needs. When you have a solution that effectively solves their problems, you’ll also be in a better position when it comes to negotiating the price.
2. Strong leadership and management abilities
Leading effectively starts with hiring people with the right skills to help you grow. Once onboard, give them the environment to succeed: this includes setting clear expectations, communicating clearly, and giving actionable timely feedback to help motivate them. Remember that you set the tone for your organization, so your work ethic and attitude matter.
3. Sales and marketing expertise
Previous sales experience can help you hit the ground running, and marketing expertise is a must if you want to excel at agency ownership. Tap into your past experiences to better understand your client’s needs and challenges.
4. Financial literacy and budgeting skills
Before diving into agency ownership, you should have a solid understanding of your costs and how you’ll generate agency revenue. You should also set up a bookkeeping and accounting system from the beginning.
5. Strategic thinking and problem-solving capabilities
Entrepreneurship is all about being comfortable with change, so being able to tackle problems as they arise is a huge asset. As an agency owner, you might find yourself strategizing about how to win back that major client, how to improve your solutions offering, how to handle a regulatory shakeup that impacts your business, and many other issues.
6. Adaptability and willingness to learn
Even if you’re a marketing pro at the top of your game today, the game might look very different by this time next year. Just because you’re the leader of your agency doesn’t mean you can expect to sit back and let others do the heavy lifting: you should adopt the attitude of a perpetual student, and maintain curiosity about the latest developments in your field.
7. Networking and relationship-building skills
It’s an adage in sales that all things being equal, people prefer to buy from someone they like. Relationships are a valuable asset in business, and the more you can develop your network and establish strong relationships, the better off your bottom line will be.
8. Time management and organization skills
Managing your team and your roster of clients will put your time management skills to the test. The more time-saving solutions you can implement, the better. For example, using a powerful website builder will help you deliver websites much faster than creating them from scratch.
9. Creativity and innovation
A single digital marketing problem can have a variety of potential solutions, and your job is to creatively come up with the one that best suits your client given the products and services you offer. Maintaining a sense of playfulness and creativity can serve you well when solving problems, crafting sales pitches, and running the daily operations of your business.
10. Resilience and perseverance
No business is without its hiccups, and how you handle challenges often determines how well you do overall. It’s easy to maintain a positive attitude when things are going great, but if you can persevere and stay focused through challenging times, your agency will prove far more resilient.