This year we got the opportunity to present at HubSpot's Partner Day, it's always a treat to be around like minded individuals and learn from others!
We submitted the sessions, "We Lost Half Our Agency Revenue in 30 Days...Here's How We Recovered," which was selected and we presented 2 seperate times through the day.
You may be asking, why on earth would you submit this kind of topic to tell others about. Well, our goal is to learn from mistakes and grow our business and the more and more agency owners we talk to, everyone has the types of pains that we learned during this season.
Most agency owners put their agency in last position, meaning everything comes before working on their own agency, client work, sales, managing contractors or employees. The areas we highlighted in our presentation were focused on building process in your agency, specifically, sales, software and staff. Enjoy!
I'll jump straight to the catch here if you don't have time to speed through the whole video above.
In short, we grew really fast, from January 2017 to January 2018 we grew 10x from a revenue perspective. We were on fire, deals were easy to close, the team was fun to build and everything was on cruise!
What were we doing? Running inbound campaigns, writing lots of content, redesigning websites, emails campaigns, paid search, paid social, and selling lots of HubSpot licenses!
But as you know, seasons change.
Looking back, we tried to identify warning signs from clients that we try to spot as red flags earlier now:
- Client buy-in: are the committed to the strategy long term, are they getting impatient, not using the software tools like HubSpot? Do you feel like you are having to resell the strategy each month or more often?
- Alignment of strategy and goals: do they change their goals often? Do you feel like you are having to pull them back into "here is the strategy to reach ____ goals."
- Business transitions: have there been leadership changes? Have they lost business or clients? Are they having trouble closing sales?
These are all red flags that you should be watching for.
Losing Half Our Revenue
You may be asking, did they really lose half their revenue in 30 days? Well, yes we did, through some bad partnerships with other agencies, clients being acquired, clients breaking their contracts early and/or not renewing, we lost half our revenue from February 28th through March 26th.
- We outsourced too much of our work to high priced contractors, and other agencies. In hindsight, those contracts were too expensive for us to handle and still make money without building long term value. Probably the most important learning lesson was that we abdicated much of the responsibility, assuming those contractors and other agencies were carry the same level of responsibility and ownership of the clients goals that we did.
- We expected software to solve our problems. We didn't hire software to extend our existing process and systems to help clients win in the long term.
- Our sales process was sound, but we weren't picky enough of the clients we selected to work with. We didn't focus on the right fit clients.
How Did You Recover?
Yes we did recovered. Truth be told, it was just hard work. It tooks us about three months to close enough business to get to the same level of revenue, but the lessons we learned in the process are going to be constantly refined.
Here are the keys that we found to recover from such a hit as losing half our revenue:
- Sales - Build your sales process (hint: use playbooks). What questions do you ask? One stage of the process needs to naturally lead to the next. Run your sales process every time. Period.
- Software - Hire software to replace a system or process that you've already developed. Hire it to make what your team is already doing, better. Check out the presentation to see out grow stack of software and what we use as an agency.
- Staffing - Do you hire full-time staff? Contractors and freelancers? Understand what works for you and what doesn't. Either way, operate inside your structure that you've set up for success.
In the video I dive into the above takeaway with great depth, but here are a few:
- Follow your sales process.
- Build systems, then hire software to make it better.
- Find the right people to build your business with.
Bonus: Go all in! Get involved in the HubSpot partner community or your similar communities. What you put in is what you'll get out. Try Facebook groups, Slack channels, Local meetups like HUGs, use your software vendors as a resources (CAMs, and CCs) check out bootcamps, and ask your vendors questions. (hint: watch the end of the presentations for some gems)
We've always open for a conversation, let us know if you'd like to discuss any of the above or have other question about running an agency.