Not all agencies are created equal

I belong to numerous digital marketing message boards, and I frequently see posts asking for recommendations for “the best digital marketing agency.” This question is troubling for several reasons, which I’ll outline in this article.

Problem #1: What do you mean by digital marketing?

Asking for a “digital marketing agency” is analogous to calling the hospital because you need a “doctor.” Modern doctors specialize, sub-specialize, and even sub-sub-specialize today. There are neurologists who specialize in movement disorders, movement disorders specialists who specialize in Parkinson’s disease, and so on.

Digital marketing is no different. There are creative agencies, paid marketing agencies, content agencies and so forth. And within each of these categories, there are specialists who attack niches.

Like a hospital, it’s true that there are agencies that offer many services, but a multi-channel agency is not the right solution for every company (just like a generalist doctor is not the choice for every patient).

Problem #2: Is your marketing need big or small?

If the extent of your driving is a one-mile trip to the supermarket, you don’t need a Ferrari. Similarly, the size and complexity of your marketing needs will determine the type of agency you need to hire to be successful.

Your monthly marketing budget is an important factor for potential agencies. Broadly speaking, some agencies focus on small to medium-sized businesses (SMBs), and others on enterprise (large) accounts. SMB agencies typically charge less than enterprise agencies, but enterprise agencies typically offer a lower ratio of clients to service providers and have more senior staff members.

As a rule of thumb, you never want to be the biggest or smallest client of an agency. If you are the biggest, the agency probably isn’t truly equipped to service your account; if you are the smallest, you will probably end up with the bottom tier of account managers.

And it may be attractive to hire the lowest-priced agency, but as the adage notes: If you think an expert is expensive, wait until you see what an amateur will cost you! Of course, price alone does not determine expertise, but understanding if you meet the typical client profile of a potential agency is a lot more important than saving a few dollars.

Problem #3: Do you need people, technology, or both?

Some agencies have built internal technology that helps them improve clients’ results or automate repeatable tasks; other agencies are almost 100 percent technology with a thin layer of service; and then there are agencies that are almost entirely people-based with some technology to support their operations.

Why does this matter? Because there are some problems that can be best solved by technology and others that people will excel at conquering. Understanding whether an agency’s approach is right for you is an important process.

Again, you can often determine agency fit by looking at their current clients to see how similar they are to your business model. Note that many agency sales teams are hammers looking for nails and will try to convince any potential client that their tech/services are the right choice. I find this to be particularly true with technology-focused agencies, who will tell clients that their “proprietary algorithms” will solve every problem under the sun. As noted, technology solves some problems well and others poorly.

Problem #4: Can agencies ever beat an in-house team?

I’ve spoken with several CMOs who emphatically (and proudly) refuse to use agencies at all. These CMOs argue that in-house teams are more passionate, more in tune with their company’s unique business dynamics, and more focused on their company’s success than any agency could ever be.

These are legitimate arguments, but there are equally strong reasons to consider agencies for some or all of a company’s marketing needs. First, digital marketing — as noted — is now a world of specialists and sub-specialists. Most enterprise companies invested in digital marketing are running campaigns across multiple search engines, social networks and content sites, in addition to mobile and desktop campaigns, in addition to analytics, SEO, landing page optimization, web design, and — well, you get the point. It’s hard and expensive to hire all of this expertise internally.

Moreover, internal teams have more expertise about their company, but they usually have less expertise about online marketing than their agency peers. Because agency marketers work on numerous accounts at once, they see more data and more approaches to marketing than in-house teams, and hence they learn more and faster.

I believe that the best approach is a hybrid of great in-house generalists and great agency specialists. This enables companies to combine the passion and focus of in-house with the expertise of agencies.

Ask the wrong question, you’ll get the wrong answer

Most companies find their digital marketing agencies (and most service providers — lawyers, accountants and so on) via referrals from trusted peers. If, however, you ask your peers the wrong question, you’ll get bad results in return.

Understanding the nuances of the digital marketing agency world will help you craft a question that will generate recommendations that will truly benefit your company’s growth.