Rob Da Costa
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Why do some companies offer their clients pain killers while most try to give them a vitamin pill?

selling

If you had a really bad headache and you could buy a pain killer or a vitamin pill, which would you buy?  The painkiller, right? Obvious!

Yet in business, I see time and time again, agencies trying to sell their prospective clients a vitamin pill.  This is not a good way to sell.

Imagine going to your best friend’s wedding and having too good a time and waking up with an almighty headache the next morning.  Would you reach for a pain killer or take a vitamin pill? Well a pain killer of course!

Clients who are in pain have an urgent need to solve that pain (with your solution). Yet many agencies are trying to sell their prospective clients a vitamin pill (something that is nice to have but not urgent) rather than a pain killer!

So when you are marketing & selling your product or service, are you addressing the client’s pain or are you telling them your product is something that would be great to have in their business?

Getting this positioning wrong will have a massive impact on your agency.

A real bugbear of mine is that many websites make this mistake by starting out selling the vitamin (which looks like telling the client how great YOU are and what YOU do on your home page) rather than recognising the pain (which looks like building empathy with your client by showing you understand the pain they are in).

This could well be the case with your own website?  

They are trying to sell the client something they may not be aware that they currently need (the vitamin pill) because although it might enhance their business, it doesn’t solve one of their major pains right now (the pain killer).

Let me give you a real example of this – something that happened to me last week.  I got a cold call from a company that can track visitors to your website and give you detailed info on them.  

Sounds great right?  

The issue is that this isn’t one of my current pains.  A current pain for me (regarding web traffic) is that I would like to get more traffic to my site.  Only then would it be worth investing a monthly fee on visitor tracking software. Meanwhile, that product is just a vitamin pill for me, so I am not going to buy it!  The guy on the phone wasn’t really listening to me and just tried to tell that spending £500 / month on their software was a good investment.  Not if it doesn’t solve one of my key pains!

They needed to better target by understanding who they were calling first.

If we start by identifying the client’s pain then we ‘stand in the client’s shoes’ and demonstrate we understand them (which builds empathy, a crucial part of the sales process). The language we use when we discuss our product or service will then be geared to show the client how we solve that pain rather than just discussing the features of our product (which we can do later).

So 3 things we can all do better in our agencies:

  1. Know your customer persona/avatar and specifically what the top 3 pains/issues are in their business
  2. Understand the language they use and build our solutions using this language, showing how our solution can cure their pain
  3. Make our initial communications (via email, blogging, your website) all about the client and their pain (so they want to read more) BEFORE we talk about our solution and how great we are

If we do this we are much more likely to build empathy with a client which will lead them to say ‘tell me more’ and then you have started a dialogue that can more easily lead to a sale.

A customer story of how niching can dramatically scale your business 7-fold (from £163k to £1.1m)

niching your agency

Cityzen is an award-winning, multi-disciplinary design practice that works with commercial contractors and property developers to bring designs to life.

They contacted Da Costa Coaching after listening to Rob gave a talk at a local networking event.  They had worked with a coach previously but saw that Rob’s service-based agency experience together with his no-nonsense and pragmatic approach would be a good fit for Cityzen.

Charlotte Smith Director commented “From our experience, we saw that many coaching firms tend to have a predefined approach that they use with all clients, regardless of need or size. The first thing Rob said when I met him was “I’ll listen to you and address the underlying needs of the business”. True to his word, Rob did listen and adapted his tools and processes to fit our needs. For us, he has been a coach, mentor, trainer and at times, a shoulder to cry on! He has created accountability to help drive our practice forward.

One of the conundrums Cityzen faced was trying to service both domestic and commercial clients.  This meant within one working day they could be designing homeless housing for a Council and a domestic loft conversion.  It was clear that the domestic clients needed a lot more account management (hand holding, explanations, more frequent communications and so on) than the commercial clients, who had a better understanding of the process and also trusted fellow professionals to get on and deliver their work.

The coaching process led many discussions around identifying ideal target customers (customer personas), enabling Cityzen to define and focus on profitable and more enjoyable clients. But it soon became obvious there was a need to niche. Like many companies, there initially was a reticence because of the potential for lost business.  After spending time researching the market and analysing time spent on customer work, it became apparent that (a) The commercial market was plenty big enough for Cityzen to solely focus on (b) the way to engage with this sector was by building face to face relationships and (c) the domestic clients took approximately double the amount of account management and as a consequence, were often unprofitable.

Faced with this information, Cityzen committed 100% to niching their agency to focus on commercial clients only.  This meant

  • Changing the focus and wording on their website
  • Focusing 100% of marketing efforts on commercial clients
  • Turning down domestic opportunities

Fast forward 6-months and the results are startling:

The whole of 2018-19: Offering professional services to B2B and B2C, delivering construction-focused design

  • 30 enquiries
  • Potential £163K income.
  • Average enquiry value of £5K

2019-20:  delivering the same package but niched to B2B only (developers, concept architects, contractors)

  • 16 enquiries in the first 12 weeks of the year
  • Potential £1.1m income (so far only, only 3 months into the financial year!)
  • Average enquiry value of £68K

Charlotte Smith, Director, concluded “It took, what felt like, some bravery at the time to turn our backs on domestic work but the strategy we worked through with Rob has put us in the strongest position we have ever been in.  Not only that, but the work we are being invited to do is more aligned with our values, and fulfilling for our team.

This is a great story of focusing on a niche and using the intersection of where you get the best results, where you are most profitable and where your passion lies, to work out what your niche should be.  It also shows the power having a clear niche will have on your bottom line (from £163k to £1.1m).

9 Ways That Niching Your Agency Can Triple Your Profits in A Year (The Ultimate Guide)

niching your agency

Introduction

I’ve seen it time and time again...

Agencies that have a clearly defined niche massively outperform those that don’t in almost every way: revenue, customer retention, employee satisfaction, and in the quality of their client relationships (because prospects see you as the expert, not just as a supplier).

A big statement to make? Sure - but I know it’s accurate because I’ve lived it. Niching my agency allowed me to triple my profits inside 6 months (you’ll read more about that in the next section).

And in my coaching practice, helping clients to niche their business is one of my most common interventions.

I recently worked with a PR firm that served three main niches. They were doing well, but were struggling to grow their agency and win new business. They felt stuck - like they were perpetually taking one step forward and one step back, never truly making progress towards their goals.

We worked together to answer three core questions (covered later in this article) about their business, the answers to which revealed a clear target niche for them. And by honing in on this area of their business and committing to it in their sales & marketing, they were able to land three new (highly profitable!) clients in just 90 days.    

The world values specialists. When you have a cold or a flu, you head over to the GP and take their advice as gospel. But when you need urgent surgery on your elbow, you don’t settle for a GP - you go for the best surgeon you can find.

It’s the same with your agency. People with burning problems want to have them solved by experts. When you serve a specific group of customers, you can:

  • Position yourself as an expert, not just a “jack of all trades”
  • Deliver great results to your clients through constant exposure to their most pressing problems
  • Charge higher rates (think how much more money a surgeon makes than a GP!)

How much less stressful would running your business be if you knew you could serve a highly targeted group of customers that saw you as an expert (and paid you the fees you deserve, without question)?

In this article, we’re focusing on how niching your agency can help you to supercharge your profitability, attract a constant stream of great prospects, and effortlessly build stronger relationships with clients (which is SO much less stressful than running a generalist agency).

Here’s what we’re going to cover in this article:

  • Exactly why failing to niche down your business is holding your agency back (Hint: it’s all about perception)
  • How you can find your most profitable niche (and why you shouldn’t be afraid of “missing out” on all the niches you don’t choose)
  • Specific examples of businesses that have succeeded by selecting a niche (vs. taking a generalist approach to positioning)
  • How you can position your business to speak directly to your target market through developing crystal-clear customer personas
  • Why your website & all outbound communications have to be designed with your niche in mind
  • Some of my best resources for defining your niche and ideal customers
  • Some of the best tools available for carrying out keyword research (a huge asset to any niche agency)
  • A simple one-page action plan, detailing everything you need to do to kickstart the niching process for your agency

The information you’ll learn here is the kind of advice my coaching clients routinely implement with tremendous results. So if you want to start getting paid like a specialist (and have more fun with your business than ever before), then read on!

We cover a ton of information here, and I know how hard it can be to actually apply everything you read when you have so much else on your plate already. That’s why I’ve summarised everything you need to know in this One-Page Action Plan. Click the image below for instant access.

No matter what industry you’re in, niching works. I saw it when I was running my own agency. I’ve seen in my clients businesses’ - and I’ve even seen it in my coaching business.

Back in 2007, when I first started my practice, I was a generalist coach. Whether the client was a large corporation or a small startup, I was happy to help them all the same. I thought that I needed to be a generalist from the get-go so I could get my coaching business off the ground, and set up my website and marketing to reflect this.

The issue with this approach was that in trying to appeal to everyone, I ended up appealing to no one.

I didn’t have a compelling story to tell larger clients because I didn’t have loads of “large corporate experience”. As a result, those types of companies were hard to win.

On the other hand, I had plenty of relevant expertise to offer startups and smaller businesses - but when they heard that I also worked with bigger firms, they would assume that I couldn’t understand the particulars of their situation. Consequently, I struggled to land clients from either category.

I was in a lose-lose position. It turned out that my beliefs about niching and winning new business were completely backwards. Rather than making me more attractive to prospects, positioning myself as a generalist was actually hurting my chances.

But if I took the opposite approach, and instead chose to niche my offering and serve a small group of potential customers above all others?

I would be in a much stronger position to succeed.

Sometimes the simplest truths are the most difficult ones to accept… but after much soul searching, I made what I felt was a very brave decision to niche my business.  

How I Chose My Niche

For me, choosing my niche was not difficult. I had been a part of the marketing agency world for the previous 15 years as head of my own agency, so I was certain of two things:

  1. I was really passionate about the space
  2. I knew an awful lot about it - enough to deliver great results for clients  

But despite being passionate about the niche, and being confident I could deliver results to my clients… I still hesitated.

Looking back now, I can see that it felt like a big decision to make because I still believed that I’d miss out on tons of business opportunities by picking one niche to serve.

I thought about it for hours, days, weeks on end. I’d ask myself “But if I focus just on the marketing agency sector, won’t I miss out on lots of other potential clients?”

As I’ve seen many times in my life, honest reflection is key to finding an answer to the difficult questions. In this case, I had to face up to the reality that I wasn’t winning many clients anyway. Most of them were put off by my generalist positioning, choosing instead to go with more focused alternatives. So really, I didn’t have much to lose. Worst-case scenario, I could pick a different niche, or go back to being generalist if niching didn’t work out.

Fortunately, that wasn’t an issue, as niching my business turned out to be the best decision I ever made.

Within six months, I had tripled my profits and was winning new business left and right. And not any old clients either - ones that I understood deeply (so I knew I could do a fantastic job for them)... ones I truly enjoyed working with.

Two Key Points About Niching Your Agency

It’s been almost 13 years since I first started serving this niche above all others. And with the benefit of this experience, I have two key learnings to share with you. Using this advice, you’ll be able to better establish your niche, serve your target audience and build a sustainable agency that profits for the months and years to come.

#1: Your Niche Defines You - It Doesn’t Entrap You

Defining a niche for your business doesn’t mean that you can never take on an opportunity outside of that niche. While you don’t market and sell yourself to other niches, it’s still possible that clients outside your chosen target audience will seek you out - or that a chance will come across your path that’s too good to ignore.

In these cases, you can make a decision based on the facts at hand. If you feel your agency is a good fit for the work based on your culture, you can deliver good results to the client and would also enjoy working with them, then go for it!

Few agencies will serve just their niche and no one else. You’re free to pitch for and serve business outside of your chosen market. As long as you don’t forget what your core focus is (and why you picked it), there’s nothing to worry about. 

And remember: choosing a niche doesn’t mean you’re committed to it forevermore. In fact, I frequently tell my clients that it’s far better to start niche and then broaden out, rather than starting broad and trying to narrow down. As you establish a strong position in your target market, you’ll be able to expand the scope of services you offer to people outside that niche. Over time, you can transition completely if you like.

I’ve seen this in my coaching business. While I started out working with marketing agencies only, I’ve since gained enough experience in the marketplace to help other types of businesses too. My client base is still mostly marketing agencies, but has expanded to include clients outside this niche too. It’s a roughly 80/20 split between niche and non-niche clients.

You’ll probably experience a similar development in your business over time. If you choose your niche well at the beginning, you’ll continue to serve that market above all others - but there’s nothing wrong with dipping your toes in other waters too, if you feel the prospect is a good fit and you will be able to do a good job for them.

 #2: Niche Businesses Earn More Than Their Generalist Competitors

Niche businesses nearly always charge more than generalist ones, simply because they are seen as subject matter experts. The more narrowly defined your niche, the more likely it is prospects will assume you are an expert in the field.

As a niche agency, you are seen as an expert. You’re not a mere supplier for some commodity: you’re a trusted partner, someone to be consulted. This, in turn, allows you to build better relationships with your clients - and earn higher fees.

That’s why surgeons get paid far more than GP’s. It’s why World War II historians are seen as more knowledgeable than history teachers when it comes to discussions of World War II. And it’s why some web development agencies can charge £50,000 for a website (while others struggle get paid even £500).   

Selecting Your Niche - The Three Questions You Need to Answer

To be honest… it was easy for me to select the niche I’d serve with my coaching business.

As we discussed in the previous section, it just made sense to serve marketing agencies. However, through working with over 250 agencies in a coaching capacity, I’ve seen that it’s not always so easy to pick your niche. In fact, it can be downright confusing if you don’t know what segment of your business to focus on.

I find that there’s a few key questions businesses need to answer before they can choose their best niche. Consider these questions when researching what niche you’d like to target:

  1. What part of your agency is most profitable? You can look at this vertically or horizontally (by market sector or by service provided). E.g. a full-service marketing agency may find that their digital marketing activities are more profitable than anything else in the business. Or perhaps their financial institution clients are more profitable than any other segment.
  2. What type of customer can you get the best results for? Consider whether you deliver best to small businesses or larger ones, and the sectors these businesses work in.
  3. What kind of work do you most enjoy working doing? This one is massively important. We do our best work when we enjoy working with the client and are passionate about the results we deliver. Working with clients you’re not excited to assist will put you on the fast-track to burnout.

You can visualise these questions with the following graphic:

You want your chosen niche to be at the intersection of the Money, Passion, and Results circles. This will allow you to build a sustainable business where you can deliver great results for clients, earn fees you deserve and enjoy the work you do.

Operating a business that fits in just one of these circles (or even in an overlap between two) will be unsustainable in the long run.

  • If you don’t earn enough from the work, you won’t be able to keep doing it
  • If you can’t deliver great results for clients, you’ll struggle to retain customers and win new ones
  • If you don’t enjoy the work you’re doing, burnout is inevitable (trust me - it’ll happen sooner or later)

Take the time to figure out what niche lies in the overlap between these three circles. This market will become your core focus, allowing you to build a stable agency dedicated to serving those customers.

A Simple Way to Think About Niching

If you’ve run through the three questions above and are still having some trouble wrapping your head around niching… consider the following framework.

 There are four easy ways you can think about niching your agency.

  1. By geography
  2. By industry/vertical sector
  3. By deliverable/service
  4. By problem

Let’s examine these in more detail below.

By Geography

This one is self-explanatory: you can choose to serve a market based on geographic location.

This can be a good strategy when knowing the area is a competitive advantage. Understanding the lay of the land and being able to “speak the language” of your target audience is often an invaluable asset in winning their business.

By Industry/Vertical Sector

Examples of industries/verticals include pharmaceutical, telecoms, tech, and education.

These sector definitions are quite broad, so it can be a good idea to niche down even further by identifying a sub-sector in the niche e.g. rather than serving tech companies, you could drill down and focus on helping consumer tech start-ups or B2B SaaS companies.

By Deliverable/Service

Examples of deliverables/services you may provide could include PR, web development, SEO etc. Once again, it’s important to ask yourself if the specific service you’ve identified is niche enough… or if it’s too broad.

If it is too broad, you need to establish a niche position that makes you look like a specialist, not a generalist. For example, you don’t just offer PR services - you’re an expert in Crisis Communications. You’re not just a web developer - you’re a web developer that specialises in integrating CRM systems.

By Problem

Sometimes, you’ll find that a lot of your clients are facing broadly similar problems. E.g. you help startups win funding from competitive grant programs, or you help financial practitioners generate more leads for their services.

If you habitually help your clients with the same problems, you could consider basing your business around solving this problem. And if you can explain how and why you are uniquely qualified to serve this sector, you’ll do just fine!

Once You’ve Picked Your Niche - What Then?

Once you’ve picked your niche, you need to commit.  

All of your outward communications should be crafted with this niche in mind. If you’re advertising, you should endeavour to speak to your target audience directly. Forget about being all things to all people - serve the few so that you may build a profitable, stable business that will eventually serve the many (if you want it to).

Your goal is to be seen as an expert in your chosen sector. In practical terms, your website should be geared towards achieving this outcome. First impressions matter. You don’t have very long to convince people you can help them. As soon as prospects land on your site, they should be able to tell:

  • What your niche is
  • That you understand the burning problems they’re facing
  • That you’re capable of solving these problems for them
  • How you’ll add value to their business

Let’s look at some quick examples to really drive this point home.

Look at this web design agency. Here’s the first thing you see when you click in…

 This is the site of a web design agency located in East London - but you wouldn’t know that from looking at their home page.

Their offer of “bespoke design and web development” is stuck in the top left corner in small white font. The most prominent thing on the page is the fact that they’re looking to hire developers.

Suffice to say that prospective clients who come across their website are unlikely to stick around for very long.

To apply the criteria listed above to this site:

  • We don’t have a clear idea of what niche they’re targeting
  • Because of this, we don’t know what problem they’re solving (beyond creating websites and doing bespoke design)
  • If you click around, you can see samples of their work - but the first image you’re greeted with is of business cards and stationery, which is confusing
  • Their value proposition is unclear. You could argue that “bespoke design” is their USP, but given that they’re a design agency (and have confined this fact to a tiny corner of the screen), one wouldn’t be very convinced by this statement

Now, let’s look at a better example. This is another web design agency. Here’s the first thing you see when you click onto their site:

Instantly eye-catching visual imagery, a clear contact button, an uncluttered screen and an obvious next action to take. In addition to this, they instantly speak to their audience (ambitious businesses who want their brand to “thrive online”).

Their niche is even clearer when we scroll down to the next section…

Great use of white space, and a beautiful design in general. Important for a design agency, sure - but let’s apply our criteria from above to see how well they fare.

  • Their niche is clear - they serve businesses who want to sell online and where appearance is key (e.g. fashion, skincare, etc.)
  • They understand that these businesses need visually compelling websites to convert prospects into customers
  • They have demonstrated their expertise by putting relevant samples right in front of you when you click onto their site (past projects & great images in general)
  • This + their positive testimonials & social proof prove that they’re capable of delivering value to your business

Of course, there’s more to marketing than just your website. You also need to think about how people will find you.

If you’re running ads, they need to be congruent with the niche you’re targeting. Speak their language, and tell a consistent story across all mediums you use to reach them.

Beyond ads and digital outreach, you also have to be mindful of the networking events you attend.

Packaging design business owners shouldn’t be attending events where they meet accountants, bankers, personal trainers & hairdressers. Sure, they might have some great conversations - but they won’t be talking to their target customers.

If you’re not sure who your target customers are, you need to spend some time developing crystal-clear customer personas (or customer avatars). For more info on how to do that, check out my Customer Personas Workbook (discussed in the Resources section below).

Having a clearly defined niche and understand who you’re targeting is a massive part of running a successful business in any industry, not just in the agency space. To prove this point, let’s look at another example… coffee.  

Small Batch Coffee - A Niching Success Story

I don’t know about you, but I can’t start my day without a good cup of coffee. And to be honest, I’m pretty spoilt for choice. Living in the seaside town of Brighton in the UK, I can’t go more than 100 yards without coming across a coffee shop.

In my eight years of living here, I’ve seen many coffee shops come and go. In fact, I’ve actually worked with one or two over the years (a good example of how you can take on clients slightly outside of your niche when you can add value to their business).

Trust me: it’s extremely difficult for a coffee shop to stand out from the crowd here. They all sell the same basic product (coffee), have roughly the same atmosphere and decor, and operate their businesses the same.

Most struggle to define a clear niche to target. And so they try to cover all bases (e.g. offering breakfasts, takeaway lunches, teas etc.) - this is a mistake. As we’ve already discussed, trying to appeal to more and more people usually has the opposite effect you’d like it to have.

Singing the same tune as everyone else is not a good way to get heard over the noise. This is why the majority of coffee shops are just getting by. The owners don’t get rich - at best, most just build a high-stress job for themselves.  

Of course, some coffee shops are doing very well. Take Small Batch Coffee Company, for instance.

When they first started in 2007, Small Batch was a small-scale business. Their only goal was to roast small batches of high-quality coffee. After a couple of years of this, they opened their first few coffee shops. Gradually, they expanded the company’s wholesale and retail business to include multiple coffee shops.

Today, Small Batch Coffee is a hugely successful coffee wholesaler, supplying high-quality, ethically sourced coffee to cafes and restaurants all over the south of England. They also sell coffee online direct to retail customers and serve their own customers in seven different locations.

I believe that Small Batch have succeeded because, right from the start, they were clear about their niche. They didn’t open up another generic coffee shop and starting competing with the 15 other stores within walking distance of theirs. They focused on providing home-roasted, high-quality coffee to the exclusion of all else. At least at first. They were singing a different tune… and pretty soon, people started to pay attention to them.

You’ll also notice that they didn’t confine themselves to this niche. Once they had established a position in this space, they expanded outwards into complementary markets (known as ‘shoulder niches’). This contrasts with the standard generalist approach taken by most coffee shops.

In addition to this, Small Batch established a reputation for quality in the micro-roasting business, then carried it over into their retail operations. People know that if you’re looking for a good cup of coffee, you go to Small Batch.  They prove that niching works.

The Most Powerful Resources for Niching Your Business

In this section, I’m going to share with you some of the powerful tools you can use to help niche your agency.

Previously, we discussed some of the big issues that stop you from building a highly profitable niche agency. False beliefs, not taking the time to truly examine your business, and the fear of “missing out” on all the niches you don’t choose… all of these factors can hold back your business from growing like it should. Growing your agency is challenging enough - you don’t need all this extra baggage complicating matters too!

Luckily, I’ve developed some useful tools in my time as a coach to 250+ agencies. And in this section, I’d like to share these resources with you.

Firstly, you can get a free copy of my “Defining Your Niche” eBook. Inside, I break down the difference between niche and generalist agencies, the realities of running each type of business, and a super-simple (but powerful) framework for figuring out where your business is right now - and more importantly, how to get to where you want to be.

Secondly, If you’re completely new to the subject of niching, then I highly recommend you check out the book “Blue Ocean Strategy”. First published in 2005, it revolutionised the way I (and thousands of others) think about business. I’ve often applied its learnings with my coaching clients, many of whom have benefited tremendously from the ideas contained within.

The book likens competitive marketplaces to “red oceans”: waters where fish fight for scraps and tear strips from each other in an effort to survive. Companies operating in red oceans typically have smaller profit margins, experience more competitive pressure and have a harder, more stressful time in general.

The book then goes on to explain that you don’t have to dive into these overcrowded markets. You can instead head for open water and seek out your own “blue ocean” (an untapped or underserved niche). These spaces are less competitive, allowing you to more easily establish a position in the niche (and even become the dominant force in it).

Thirdly, you can also get a free copy of my Customer Personas Workbook. Rock-solid customer personas are the foundation your niching efforts are built on. In this PDF, you’ll get my step-by-step system for getting in the heads of your target market, deeply understanding their needs, and effortlessly tailoring your business to their desires. This is the exact stuff I do with clients every week as part of my coaching practice, and some of the highest-ROI work you can do as an agency owner.

Finally, we have to face up to reality - not all niches are created equal. Some seem great on paper, but don’t pan out like they should when it comes to overall market demand. And one of the best ways to gauge how viable a niche is? Keyword research.

One of my favourite keyword research tools is Keywords Everywhere. This free browser extension gives you access to tons of keyword-related info that you’d otherwise have to pay for via expensive Adwords campaigns and the like.

You can also consider Neil Patel’s namesake app: another great resource at your disposal.

And if you don’t mind spending a little money, you should check out Ahrefs, which has tons of useful content for researching a niche, and positioning yourself within one.

Using tools like these, you’ll be able to research your chosen niche & associated keywords in detail, assessing its viability without committing lots of money and time to the cause.

Your Action Plan

We’ve covered a lot of ground in this article. To help keep this actionable, I’ve outlined the very next steps you should take to start the process of niching your agency.

If you’re interested in getting your hands on this free One-Page Action Plan, click the picture below for instant access.   

Niching your agency

Conclusion

The value of having a clearly defined niche cannot be understated. In my experience, niche agencies outperform generalist ones in almost every way. They: 

  • Earn higher revenues 
  • Have better client retention rates
  • Have higher employee satisfaction levels
  • Build stronger relationships with their clients (because they’re seen as trusted experts, not just suppliers) 

Running a niched agency doesn’t entrap you - it frees you to build a business that delivers great results to clients, earns you the fees you deserve, and allows you to work on projects you’re excited about.

Your ideal niche is at the intersection of profitability, your ability to deliver results to clients, and what you’re excited about (Money, Passion and Results). Making anything else your focus is unsustainable in the long run.

You can also think of niching in terms of geography, industry, service and the problem you’re solving. Remember, these are just four different ways of considering how you might differentiate your business from your generalist competitors.

Once you’ve picked a niche, you have to commit to it. All of your outbound communication (including your website) should demonstrate your understanding of that niche and your ability to solve their problems. Websites or ads that miss the mark with this will hold your agency back and cause you to lose out on lots of business, so it’s worth paying attention to.

Having a clearly defined niche to serve is important in any industry. Web design, marketing, 3D architectural rendering, and even for coffee shops - businesses need to pick a niche to serve above all others if they hope to succeed in these spaces.

My aim with this article was to teach you everything you need to know to start niching your business today. With the tools, processes, templates and frameworks we’ve discussed here, I’m confident that you can:

  • Get your mindset right about choosing a niche for your business (you won’t be missing out - in fact, it will help your agency do better than ever before)
  • Determine what the right niche is for you (by looking at your existing business & customers, seeing what kind of work you enjoy doing, what you’re good at, where you’re located…)
  • Develop crystal-clear customer personas → extremely important when it comes to succeeding as a niche agency
  • Use the resources I’ve provided to simplify the process, helping you to establish a niche position for your business faster and easier than ever before

I’d love to hear about your experiences with niching, so please reply in the comments below with your thoughts to these 2 questions:

  1. Do you run a niche agency - do you agree with the advantages we’ve discussed here? Or do you feel there’s additional problems we haven’t covered?
  2. If you run a generalist agency - have you ever considered niching down? If so, what’s holding you back? If not, then why?

I look forward to reading your answers below!

P.S. Don’t forget to download your One-Page Action Plan by clicking the image below.

Niching your agency

Being a busy fool

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As we all know, the pressure to run faster can come from different sources. It might be clients who want everything yesterday or staff who always seem to want us to deliver more in less time. But for many of us, the biggest source of pressure is ourselves – because we like to busy but aren’t always clear what we need to be busy doing!

The busy fool works long hours and can’t turn their phone off.  They are a hive of activity but ask yourself this – are they moving their business or project forward?  If not, then they are being busy for the sake of being busy – the busy fool.

Understanding what is VITAL v what is IMPORTANT

Many people start their day/week with a “to-do list” which they diligently work their way through from top to bottom. Forget it. Instead, identify the top three vital actions on the list (which are often the hardest things) that can only be done by you. What are the real priorities? Focus on those first and then tackle the next three priorities and so on.

Doing nothing (procrastination) is rarely a safe option. Yet sometimes doing nothing and giving yourself some breathing space to think, stand back and prioritise, is exactly what you need to do!

What is the impact on the business? The danger is we become purely focused on the short term rather than the bigger picture and you get a sense of ‘1 step forward and 1 step backwards’.

Some organisations seem to work harder and longer but productivity goes down.  A business full of busy fools!

So here are 7 useful tips to help you be busy doing the right things:

  1. STOP and take time to plan – the hardest but most useful part of your day
  2. Focus on the VITAL items in your plan – is this task going to move your business forward?
  3. Delegate as much as you can – either internally or via outsourcing.  Ask yourself if someone else can do this task?  If yes, then delegate
  4. Systematise. Find ways and processes to streamline those repetitive tasks. Beware of re-inventing the wheel each time.
  5. Push back on ridiculous deadlines.  Everyone says their task is urgent but is it really?  What will happen if the deadline is moved back (and if everything is coming to you as urgent then your colleagues/clients need some help planning!).
  6. Don’t procrastinate. Do it, delegate it or dump it. Be decisive. Don’t sit there wondering where to start. Get started. I like the acronym JFWDI – you can work out what this means or email me and I will tell you!

Focusing on the right things to do to move your business forward might seem like an obvious statement but you won’t be surprised to learn that this is a common topic of conversation with clients (hence this blog post!).  Have a read of my eBook on ‘winning back time’ (complete the box below to get instant access).

Please leave a comment if you have any additional favourite tools and tips to share.

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A piece of advice I wish someone had given me 30 years ago!

Agency

I want to share something that may help my fellow agency owners. I ran my own agency for 11 years (before selling up), and even though I’m grateful for the experience… man, there were some hard times.

Lately, I’ve been reflecting on the experience I had towards the end of running my marketing agency.  I was thinking about all the hard times, and how when I was so deep in the valley, it was tough to see the light. So I decided to write a letter to myself 15 years ago. I wish I had this letter at the time because it would have been so encouraging, given what I was going through. I wasn’t going to share this, but it may help some of you, so here you go. Here’s the letter I wrote to Rob, the burned out agency owner, 15 years ago.

Dear Rob,

I know you aren’t that motivated to be at work today and you are almost certainly distracted.  No doubt your day will be filled with handling difficult clients. I know how hard it’s been recently dealing with the loss of XYZ client. They were 40% of your revenue, and you lost them virtually overnight. You’re panicking, and wondering how you’re going to make payroll with such a big loss.

You’re walking into work every day expecting to deal with yet another  ‘wheelbarrow of crap’. Problem after problem. Frustration after frustration. You’re wondering how the hell the ACTUAL business has strayed so far away from the VISION you originally had for it.

You’re wondering how long you’re going to feel so damn… lonely.

But before you throw away a great business because you think the other man’s grass is greener, let me tell you one important thing: It gets better,

Rob, my friend, here is what you need to do to turn it around:

  1. You have the potential for a great business that not only earns you a lot of money but also could give you the freedom you desire – if you make the right decisions.  So go and get some external assistance (a coach) to help you objectively see this.
  2. Remember to follow your passion. Ask yourself:  What changes do you need to make to create a business you feel passionate about again? How can you spark that same joy felt when this business only existed on the back of a napkin? There is really nothing stopping you except yourself! Which is GREAT. Because you are in full control of your destiny. And you have what it takes.
  3. Create a REAL plan (not that ineffective plan sitting on your desk that’s not really a plan, just a to-do list for today) that fires you up and that you can get your staff to execute — with excitement.  That way you can see that you are on the right track, rather than just meandering along, HOPING things will get better on their own.

Trust me, if you do these things, you will quickly realise there are more options than just selling the business. And done right, you could have the freedom to pursue other things. Like travel more. Start that business in Spain. Become a coach and so on.

Do you know the best part, Rob? The part you can’t see right now, but I wish you could? It’s that you can do all this while keeping a business running that earns you a good income and provides a great life.

If you found this useful, then please make sure you have joined my mailing list to receive more free value-added content.

Are you an energy sapper or an energiser?

negativity

We all know the type. You can feel them when you walk into the room and you can almost see a grey cloud over them. These are the people who put a pair of grey glasses on every day when they leave for work. They see the reason why something won’t work, as their default position. They are the victims; they are helpless to affect change. They are the energy sappers.

I occasionally get to experience this with clients or when delivering training. It only takes one! Then all the attention and time is swallowed up trying to convince that person to take their grey glasses off. Not only does this suck the energy from the room, it is also unfair on the rest of the team.

Some common traits of the sapper is that they constantly air negative views, fail to engage others, favour their own solutions or fail to deliver on the commitments they make and are poor listeners. These actions drain the energy of their colleagues, stifle creativity and hinder progress on initiatives.

Many business leaders believe that energy sappers are the biggest obstacle to success.

So what can you do?

  1. Avoid hiring them in the first place –easier said than done! (after all we always show the ‘best version of ourselves’ in an interview). But what questions are you asking them to find this out? What previous scenarios are you exploring with them? Also make sure you follow up references and discuss the candidates moods in their previous role
  1. Address poor behaviours as close to the scenario as possible. Explain we can deliver on tasks in a number of ways from delightful to disaster – and we want them to do it in a delightful way. Get them to ‘stand in other people’s shoes’
  1. Define ‘energising behaviours’ and reward staff who exhibit these behaviours
  1. Start a more formal performance management route which could end with them exiting from the business or moving role

The flip side of the sapper are those people who “energise” others.

They are high performers and help create high performance, high-energy environments. We want energisers in our business and we want to encourage, acknowledge and reward these behaviours. So define your company values and the behaviours that sit behind them. Ensure roles & responsibilities contain a description of ideal behaviours and not just tasks. Recognise and reward great behaviours not just the completion of objectives.

The traits of the energiser are not surprisingly the complete opposite of the sapper: they are open to ideas, inclusive, look for the positive, are great listeners and team players. Energisers bring energy into the room and we want them in our businesses.

So tomorrow morning, as you leave the house, consider what glasses you are going to put on – grey? neutral? or rose tinted? Are you going to be the sapper or the energiser?

 

 

Do you accept the proposal?

proposal

When is the right time to write a proposal?

This is been a big theme for me over the last 2 weeks so thought I would blog about it. We all know how much time it takes to write a proposal (indeed I have spent 1/2 day yesterday writing one!) yet many have a low conversion rates, so how do you increase that and give yourself the best chance of winning?

Many organisations will be flattered and excited to be asked to write a proposal and won’t do their due diligence – establish budgets and timescales as well as understanding exactly what the client really wants and to look internally to work out if you can deliver it (i.e. you have the skills/capacity and it’s a core service can confidently deliver). This is a time to enact one of my favourite business expressions: ‘slow down to speed up’. Take your time doing your research, going back to ask the client more questions, gather more background info etc. And if you decide it’s a good fit, then go for it. If not, then have the courage to walk away.

Anything that feels too challenging or gives you a feeling it’s going to be difficult to deliver – undoubtedly will be.

So when you have met with a prospect, had a good chat and a nice coffee, and neither party knows exactly how to wrap up the meeting so you suggest or agree to put your thoughts in a proposal, think again! Have you identified all the buying signs; do they have agreed timescales? A budget? Are they clear what they want? Or are they going to use you to shape (or write) the brief and set a budget for them? If so, beware!

Now you have decided its worthwhile writing the proposal – make it about them not you! I am amazed at the proposals I have read that start of by telling the prospect how wonderful the supplier is! This is all well and good but before you do that, you need to prove to the reader that you understand their business, market, products and challenges. Then you should outline how you will creatively solve their challenges. And only then, can you blow your own trumpet and tell them how great you are and what relevant experience you have.

There is so much more to this subject so if you want to find out more, download my whitepaper on pitching and proposal writing by completing the box below.

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Understanding your customer journey

customer journey

We all understand that in order to grow our business we need to turn contacts (i.e. target customers who don’t know us today) into customers. It’s tempting to assume that one piece of marketing or one contact will be enough to convert these contacts but in truth, it’s much more complex than that.  In order to create engaging content, you need to understand the customer journey.

Your customer personas

There are a number of stages we need to follow in order to truly understand our customers and therefore ‘speak their language’. Firstly, we need to understand who our target customer is. Sounds obvious right? You’d be surprised how few companies have identified their target customer groups (maybe 3-4 different types) and therefore can map their typical behaviours, challenges and needs of each group onto their product/service. If you do this as step one then you can start to produce sales and marketing messages that resonate with each group. Take me for example, as a business coach and mentor, 2 of my (3) customer personas are HR managers of mid-sized businesses and Owner/Managers of small businesses. Do you think they have the same needs when looking for a coach? No, they don’t. If I understand their specific and unique requirements then I can start to ‘talk their language’ when marketing to them.

Understand your customer’s journey

Now you understand your client types you can start to map the journey they will take as they look to buy your solution and move through your sales funnel. What are the various stages they go through as the convert from contact to warm lead to prospect to hot prospect and finally customer (and then repeat customer)? And what can you do at each stage to ‘encourage ‘ them to move through this process? It will certainly be different messages at each stage; your communications will get more detailed and sophisticated the further they move through the funnel.

Sound intriguing?

If not and you want to find out more, download my FREE ebook on developing your customer personas.

When Clients Just Keep Wanting More – Managing Client Expectations (part 2)

managing clients expectations

Welcome back! In the previous article, we talked about one of the most common problems agency owners face – managing clients expectations when they keep asking for more. We went over how having a rock-solid service level agreement in place is a huge boon, as it gives you an easy way to handle delivering extras and unforeseen changes.

In this week’s article, we’re going to dive deeper into the things that influence your client’s expectations, and what you can do manage them. Even before you first create that service level agreement, you have the chance to influence how they perceive you. And once you’re working together, you need to ensure that everyone on your team is on board with your methods.

Let’s turn first to how you win their business.

Sell Based on Value, Not Time

If you’ve read some of my other articles, you might already know that I’m a big proponent of value selling & pricing. Rather than figuring out how much time something is going to take you and then quoting prospects based on this time, you should instead figure out how much value (outcomes and impact) your work can create for them and price accordingly.

Getting crystal clear on the value your work brings to the table will allow you to charge higher prices, win better business, and build better relationships. Think about it – when your customers understand you’re solving problems for them that are saving them (or making them) far more money than it costs to keep you on retainer, they’ll be delighted with your arrangement.

Learning to pitch & sell based on value (and not just time) is a game-changing shift for your agency. If you’d like to learn about it in more detail, you can download my free Value Selling eBook here.  

We won’t examine the topic in exhaustive detail here – just the bits that are most pertinent to our discussion about how to manage demanding clients.

First things first…

Selling Commodities is a Difficult Business

It’s normal to price based on time. Particularly for internal control purposes, it’s good to have an idea of how long a particular project is going to take, or how many man hours will be required to get something over the line. However, when it comes to pitching, basing your price on time (and not value) is a critical mistake.

Commodities do not command large prices. When the fuel gauge in your car is teetering towards empty, you probably don’t seek out the station that charges twice the price of all its competitors. You probably don’t like paying a premium for your phone plan or business cards.

All of these are commodities. We judge commodities based on price, nothing more. And if your clients should view the work you do as a commodity, then you’ll be judged relative to other agencies in your industry. If competitor X can get the job done in half the time, they’ll seem more attractive. Even if your work is better, more tailored to their needs, or you’re far more reliable… when you pitch solely based on time, you’ll be trapped in a race to the bottom.

When you give a time breakdown to clients upfront as part of your pitch, you leave yourself open to the extremely common question of “why will x take so long?” – and when faced with this criticism, you’ll often react by discounting your price, which starts you off on the wrong foot and sets the tone for the relationship.

The real issue with pitching based on price is symptomatic of the underlying issue… focusing on outputs instead of outcomes.

Focus on Outcomes, Not Outputs

An agency that wins in the long-term is one that delivers great work to clients. Reputation is invaluable for client-facing businesses, and a reputation for doing great work is one of the most powerful assets you can build as an agency owner.

But to deliver outstanding results to your clients, you have to frame your relationship in terms of outcomes, not outputs.

The outcome is what your client is really buying. The output is what they use to get there.

Think of it like this:

  • A content marketing firm’s outputs might be blog articles, social media posts and general strategy consulting sessions. The outcomes that their clients are chasing are more engaged customers, more leads, more profitable relationships with clients etc.
  • A PR firm’s outputs include press releases, features and media coverage articles. The outcome their clients want is to have a better public image and increase market awareness.
  • A branding consultancy might deliver a new logo and brand identity documentation to their client – but what that client really wants is a refreshed brand, one that lets them capture more market share than before.

“Outputs” are commoditisable. Plenty of other agencies can deliver the same outputs you can. But outcomes are harder to copy. If you build your business on helping clients achieve their outcomes, you’ll have stronger and longer-term relationships.

If they want to expand the scope of your project beyond what you’ve already agreed on, you can politely remind them that you’ve already decided on a direction for the project. If something is to be added, something else must be removed – or else an additional fee will have to be agreed for the extra work.

Three Quick Tips To Help You Deal With Demanding Clients

I’d like to finish off this article by giving you three quick tips that I’ve seen work wonders in agencies of all shapes and sizes. These practices are distilled from my years of experience coaching 250+ agencies in various sectors, so don’t be fooled by their simplicity.

  1. Agree to a contingency fee with clients upfront. Have them set aside an additional 10% of your retainer fee for extra work that might arise during the period. If you don’t do anything extra, you don’t charge them for it – but if you do, you’ll easily be able to get the payment for the additional work and won’t feel awkward asking for it.
  2. Make sure your staff are well-trained in handling client requests. Junior members in particular need to be watched, as they’ll often conflate customer satisfaction with just saying yes to everything that’s asked of them. This can cause problems for your agency as you scale, so don’t forget to ensure that everyone is on board with your way of doing things.
  3. Furthermore, make sure junior staff members don’t respond to clients too quickly! Ensure they’re getting the level of service they’re paying for. Don’t respond to their emails within an hour unless your service level agreement entitles them to this privilege (TURN OFF YOUR EMAIL DIALOGUE BOX!). Doing this is counter-intuitive for some, but will help to prevent unreasonable client expectations in the long run.

And finally… if you’ve done all the above and clients are still asking too much of you, it might be time to consider whether you’re a good fit to work together. Working with your ideal clients is crucial to running a stress-free business in the long run.

The filtering process starts back when you’re first considering them as a client, so if you gut tells you they are not a good fit – listen to it and move on to the next prospect.

In the eyes of your ideal clients, you’ll be seen as a partner, not just a supplier. In the eyes of the non-ideal ones, you’re a supplier – a provider of a commodity, there to be used as necessary. Seek out those clients who see you as a partner.

For more information on how you can determine who your ideal client is, you can get a free copy of my Customer Persona eBook here.

Conclusion

In this two-part series, I’ve addressed one of the most common questions I’m asked in my coaching practice: what do you do with clients who keep asking for more?

These kinds of clients are often unclear about what to expect from your service because you haven’t adequately explained your terms upfront. To counter this, you can create a rock-solid service agreement at the start of your relationship. Include specifics as to the deliverables they’ll get each month, charges applicable for extras, outcomes you’re working towards, etc.

Another reason why clients seem unreasonably demanding is that you sell based on outputs, not outcomes. When you frame your work in terms of how much it costs or how long it will take, you make it easy to compare your proposal to that of many other agencies.

If you pitch based on the value you bring to the table instead, you’ll have less issues with clients demanding more from you (for no extra pay). When you’re both clear on the outcomes your work will deliver on, clients are less likely to request incongruent changes or take up your time with other requests.

Finally, it’s simply good business sense to do certain things (e.g. agree a contingency fee upfront, train your staff to handle clients correctly, and enforce response times to manage expectations). These tips can have a significant impact on your business if implemented, so don’t hesitate to give them a go.

When Clients Just Keep Wanting More. How to avoid the overservicing epidemic (Part 1)

overservicing

If you’ve read any of my other material, you know that I believe that learning to manage your clients effectively is the key to building a successful agency and avoiding the overservicing epidemic. Client management is a complex, multifaceted process: it can’t be explained in one blog post. If you’re interested in taking a more in-depth look at the topic, you can download a free copy of my Client Management eBook here.

In this two-part series, we’re going to focus on one particular aspect of client management that I’ve encountered very frequently in my coaching practice – how should you handle clients who keep asking for more?

Surprising, it’s often our good intentions that cause the most problems for the agency.

When Good Intentions Come Back to Haunt You

Let me know if this sounds familiar to you……..

At the start of any new client relationship, we want to impress them. We’re eager to do everything we can satisfy these clients because we know that the real money is made in repeat business, not short-term contracts.

We sit down with them, figure out what exactly they’re looking for (based on their brief, or by following our own processes), and give them a deadline for the work. Depending on how important this new client is to us, we might place ourselves under some pressure with a deadline that’s a little too close for comfort – but we’re confident we can pull it off.

That is… we’re confident until that client comes back with additional requests (how often do you hear from a client “oh by the way, can you just add this in, it won’t take you long”  Famous last words!  Maybe they want to amend the original project or have some separate work completed. Whatever it is, we’re setting out to satisfy this client, we agree to their request and complete the extra task.

Suddenly, you’re in a position where the client has now got something for free. This starts to create an expectation on their part that they can call you up or fire off a quick email and have their problems taken care of at no extra cost.  

And when you deliver on the main project, they’ll probably be thrilled with the quality of work – and at all the extras they got along the way. But when they return with more requests for the following month, they expect that you’ll continue to handle all these “little extras” for them… even when they add up to a significant time commitment.

If you try to pull back and stop delivering all these extras or try and charge them for them this time, the client can become dissatisfied. They’ve been conditioned to expect one thing, and are receiving another. Because it’s less than what they wanted, they’re unhappy. And unhappy clients are rarely long-term ones.

The Problem With Over-Servicing

Over-servicing is a common way agencies try to achieve customer satisfaction. That’s because it works for the client – by constantly over-delivering on client projects, you can pretty much ensure that they’ll be “wowed” with the service they’re getting – but not for your bottom line.

A tough situation, to be sure – and one I’ve encountered all too often in my coaching practice.

“Going the extra mile” (which by the way, I was telling a client yesterday is NOT a good value for their agency) can be a useful tool for your business, but only when it’s strategically deployed. I always tell my coaching clients that over-delivering by 10-15% occasionally is fine, as they’ll probably be able to make up that difference another month when there’s less to be done. But constant over-servicing in the name of greater client satisfaction is a losing game, not one you should play if you’re trying to build an agency that wins in the long-term (not just today) and remains profitable.

Handling clients that are always asking for more is difficult, but there are certain best practices you can follow to make it easier. Let’s look at the first of these now in more detail.

Create a Rock-Solid Service Level Agreement

First impressions count. If a client’s first impression of your agency is that you’re simply there as a tactical supplier, it’s unlikely you’ll have a frustrating short term relationship with them. However, presenting yourself as a competent and consultative partner from the outset (not just a supplier), results in a stronger long-term relationship based on respect from both sides.

One of the most important things you need to get right is your ‘service level agreement’. You likely already have standard terms of engagement/standard scope of work documents in place – if you don’t, make this a priority!

A really solid service level agreement will outline the scope of work to be completed for a particular project, relevant deadlines, outputs, outcomes, and response times etc. But it’s not just a case of including everything that the project entails… it’s also about figuring out what’s not included.

If you recall the example we discussed earlier on in this piece, you’ll remember that many little client requests add up over time, to the point where you’re losing out on significant amounts of billable hours. This undercuts your agency’s profitability, leaving you with a difficult decision to make – should you keep over-servicing that client to keep them happy, or renegotiate the terms of your arrangement (and risk losing them), or just walk away?

This dilemma can be avoided by setting out:

  • A clear scope of work for what’s included in the monthly retainer
  • The rate you charge for extras (you know I am not a fan of selling hours so try and keep to project fees when pricing additional work)

With this in place, you’ll have an easy out when clients come along with additional requests outside the scope you originally agreed upon. Ensuring they understand that ‘extras’ cost extra from the outset will only be of benefit to your business in the long-run… but if you fail to put this in place upfront, you’ll suffer. Part of this is getting your MINDSET right from the start and ensuring you constantly communicate the VALUE of what you do rather than just the OUTPUTS (more on mindset in a future blog).

Conclusion

In this week’s article, we talked about one of the most common problems I’ve seen in my work with agencies of all shapes and sizes… not being able to to say NO to clients who keep asking for more.

This is a problem for your agency because it puts you in a position where you’re running just to stay in place. When you eventually want to slow down and return to the original terms of your agreement with a client, they’re dissatisfied with a feeling of getting less value for their money.

Starting off on the right foot is very important. With a well-drafted scope of work and agreed service levels, you’ll be able to avoid delivering increasingly unprofitable work and getting backed into a corner by client expectations.

In the next article, we’ll talk about the crucial difference between outputs and outcomes, how you can avoid your work being seen as a commodity, and some quick solutions you can put to work in your business right away to solve this problem. Meanwhile, I would love to hear back from you about your experiences with managing client expectations so please leave a comment, or if you have a specific challenge drop me a message and I’ll give you my best advice.

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