Wednesday, August 28, 2019

Why Digital Agencies Need to Diversify Quickly


You put up a query around DigitalMarketing services or Social Media services on a portal (job, social network, gig-based networks or simply a freelance network), and within minutes you are being hounded by social media “experts”. You receive calls, direct messages, messages on WhatsApp. Some of these service providers are really affordable, and from a pricing standpoint, you have hit the jackpot! There are multiple agencies/freelancers working under the garb of an agency willing to work for free, almost!
This may be appealing initially but in almost all of the cases, this model is not sustainable and cannot work for too long. The service received is poor. The ROI is minimal and the time that has been wasted in the engagement is lost forever.
The Current Digital Marketing Industry
Before we look at how to address this, let’s try to look at the history of what forced us to end up here.
The low hanging fruit – In reality, the barrier to entry for entering this profession is extremely low. Excelling is a different ball game together (which I will discuss in the latter part of this article). Anyone born in the ’80s and ’90s has a good command over technology and has seen and used these platforms, can become a so-called “digital marketer”.
No capital expenditure needed – Who does not like this? Starting a business without investment.
Design is cheap – No, the design is not cheap! In fact, I find that good design is the most expensive part. It is rather unfortunate that the way tools and software have been exploited and rampant piracy has been used. Clearly, ethics have taken a back seat.
Packaging and selling Digital Marketing courses – A lot of Digital Marketing training institutes mushroomed across India where the focus was on making a quick buck, rather than building marketers with a strong foundation. It was always quantity over quality, and these courses were not at all cheap. The graduates from these programs proudly claim to be digital marketers. We interview them for job interviews and trust me, finding a good marketer is like finding a diamond in a coal mine.
So, now we are in a situation where we have people selling services at less than $2 per hour. We have been successful in creating an extremely mediocre talent pool fighting for that $2 per hour.
How can the Agency and Brands Stay Strong in This Ever-Changing Game!
We have been observing this industry since the past decade and would like to share our observations with fellow agencies as well as brands who are looking for agencies.
You are currently over-dependent on Facebook/Instagram – Creating a graphic and posting it, writing ad copies and running simple ads; these are not going to get you too far. You need to understand that business should not be easy to replicate, hence if your client can move from you to someone else, then it is time for you to think again. If your business model revolves at the mercy of Facebook, it should be considered a red flag. We have seen a lack of consistency as far as Facebook advertising is concerned, Facebook loves to A/B test, and guess who pays for it – you or your client!
Concentrate more on original thinking – It is easy to search for similar products and services and try to copy their marketing strategy. Although I would not be completely against it as it's ok to take inspiration, your thinking needs to be original, otherwise, it will just add noise in this cacophony.
Know the Costs Involved – The bottom line is, as long as you are able to justify the costs to yourself, you will be able to justify and explain them to the client or the lead. It’s actually easy, just grab an excel sheet and estimate the following:
The number of resources required
The number of hours the task will take
Cost of the resource
That simple?!? Not exactly. Let I break down the cost of the resource (as this is what we get wrong all the time). There are various factors that come into play here while deciding this cost:
The cost to hire that resource
The cost to the company (everything goes in here, and I mean everything right down to the money taken by the janitor!)
The cost of the resource falls sick or leaves
Cost of software(s) used (you can include that in the CTC, though I would stress on the fact that even if you are small, try to follow ethics, they will take you a long way)
The cost you incur to train/motivate the resource
You cannot know these costs when you start, but keeping an eye on them and focusing on them can help you define the right price for your offering which you can back up.
One Size DOES NOT fit all – Bigger companies are no longer looking at generalists. They want people who are super-specialized. If you are still operating under the umbrella of a 360-degree agency, it’s time to rethink and focus on your core strengths.
Communication is the key – This is the part that I see most young professionals in this space get wrong, it always has to be a mix of branding and sales. Focusing on sales only may get the customer to your door but ignoring branding will not keep them engaged or encourage buying again.
The digital landscape is evolving and so should you! You need to know what the popular networks are and be there before your users show up. You need to be early adopters and have the will to experiment. This field will turn into the specialized-network-based field in the future.
If you are looking at getting your digital communication audited, do get in in touch with us at info@vggroups.com



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