If you have just started a marketing agency, brace yourself for possible challenges.
There are over 14,000 advertising agencies in the United States alone. Therefore, the competition is stiff, and standing out from the crowd can be difficult.
In addition, you’ll face other agency challenges — from fretting about finances to getting and retaining new clients.
This blog explores 21 common challenges agencies face and tactics you can use to overcome them.
FAQs Before Starting
In a rush? Here’s a quick FAQ section to answer common questions related to agency challenges.
What’s the Best Way to Overcome Agency Challenges?
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How Does Remote Work Affect Challenges?
Agencies are reaping the benefits of working remotely. Firstly, remote work can save business owners the expenses of a physical location, from office space to utilities.
Secondly, statistics show that 71% of remote workers cited working from home helps them better manage their work and personal lives.
However, remote work has challenges, such as difficulty connecting with co-workers and maintaining the company culture.
Technology and Innovation Challenges
Let’s take a deeper look into the technological stumbling blocks of agencies.
1. Keeping Up with Rapidly Changing Technology
Agencies must continually adapt to the ever-changing technology — Artificial Intelligence (AI), digital tools, and emerging social platforms — to remain relevant and competitive.
Solution: Track the technologies other agencies are using to stay up-to-date. Leverage tools and emerging technologies to deliver innovative solutions for your clients.
2. Integrating AI and Automation in Campaigns
IBM reports have shown that 35% of companies currently use AI, and 42% are exploring AI’s potential to transform business operations.
Agencies are particularly excited about the opportunities to incorporate AI into their campaigns. However, they are still learning to adopt AI technologies in marketing strategies without closing the ethical boundaries.
Solution: Find a careful balance between AI and automation and have human oversight. Besides, retrain and reskill teams to use AI tools to ensure brand safety and compliance.
3. Adapting to Industry Trends
Every agency — whether a full service, advertising, content marketing, branding, or design — faces disruption.
They must deal with constant industry shifts in customer behavior, complex market dynamics, and technological advances that accelerate it all.
Solution: Stay informed on industry changes and innovations. Adopt strategies and embrace innovations that align with your services.
Client Management and Relationship Challenges
These are the persistent challenges concerning client-agency relationships.
4. Maintaining Client Relationships
Getting and retaining clients is a massive struggle for business owners. Besides, it’s difficult to build great client relationships over time.
Solution: Prioritize client satisfaction and deliver outstanding services. Maintain clear and constant communication and regularly address the client’s needs.
5. Demonstrating ROI to Clients
In today’s competitive digital landscape, everything is measurable, and your customers expect proof of success.
Showcasing ROI and meeting the client’s expectations can be challenging, depending on your services.
Solution: Set a reporting dashboard so your clients can check real-time KPIs and metrics at any time. Use data collection and analysis methods — conversions, social media followers, email signups, and Google Analytics — and prepare reports.
6. Managing Client Expectations
Forging an excellent client-agency relationship isn’t simple. Things do go wrong sometimes due to miscommunication and unrealistic expectations.
Solution: Actively engage clients in goal setting. Maintain proactive communication and offer updates on ongoing projects. Execute projects within the budget, on time, and with agreed objectives.
You can join our free Prospecting On Demand Facebook group to learn more about closing and retaining high-value clients. You’ll mingle with other agency owners and get practical and the latest insights to help you grow your business.
Data Management and Privacy Challenges
Below are the solutions to overcome data and privacy challenges and come out on top.
7. Navigating Data Privacy Regulations
With more personal data being collected than ever before, there has been a growing concern about data privacy and security.
Solution: Agencies should implement data security measures and understand complex compliance policies. They should be transparent to consumers about collecting and using data and educate employees on data privacy regulations.
8. Effective Use of Big Data
Big data is an asset to every business, regardless of size. Agencies, in particular, can run into challenges when dealing with different clients and accounts and leveraging data for insights.
Solution: Hire data experts or train your employees to make decisions based on insights from large datasets. Explore data analytic tools and software and implement data policies to protect consumer information.
9. Ensuring Brand Consistency Across Campaigns
Brands must post similar messages across platforms to build the audience’s trust and loyalty. It’s challenging for the internal marketing teams to understand each client’s branding and adapt them across campaigns.
Solution: Develop a brand style guide for each client. Learn the newest strategies for each social platform. Educate internal teams on the brand guidelines. Use tools to streamline brand assets across social channels.
Creative and Strategic Challenges
Below is a list of common creative and strategic challenges agencies face.
10. Staying Creative and Innovative
It’s common for clients to want agencies to develop out-of-the-box projects. To remain competitive, you must stretch your creativity and keep your services fresh and practical.
Solution: Hire diverse talent to spark creativity. Reward your creative team after accomplishments. Encourage your team to take risks and experiment.
11. Balancing Digital and Traditional Media Strategies
While digital media has become indispensable, traditional marketing still has value.
Most marketers, however, don’t know how to blend digital and traditional media strategies. So they don’t exhaust the capabilities of both media.
Solution: Define your audience and use suitable media to reach them. Track your campaigns to see which strategy works best. Experiment and switch strategies when needed.
12. Multichannel Strategy Coordination
Today, consumers are digitally savvy and demanding; they expect a customized and seamless experience with your brand across different platforms.
While there are various social media platforms to spread their online presence, agencies find it hard to keep up with changes in the channels and algorithms.
Solution: Post regularly on your chosen channels and maintain a consistent voice and image.
Monitor digital platforms to track customer insights. Post content that resonates with your customer base. Stay updated with the latest trends and adapt strategies.
Operational and Financial Challenges
So, what are the operational and financial challenges agencies face? Let’s discuss some of them.
13. Talent Acquisition and Retention
Agencies depend on top talent to succeed. However, they constantly struggle to find qualified and enthusiastic employees to work and stay on for years.
Solution: Address concerns of your quality talent and establish clear expectations. Implement ongoing training to equip your team for the evolving digital landscape. Besides, provide growth opportunities and offer competitive pay and benefits.
14. Budget Constraints
Often, agencies must squeeze more out of their lean budgets to satisfy their clients’ needs. Common budget mistakes include underestimating the costs of a project or allocating resources to ineffective campaigns.
Solution: Every penny counts — develop detailed budgets, allocate resources wisely, track expenses, consider additional costs, and regularly assess your financial performance.
15. Remote Work and Team Coordination
While 13% of full-time U.S. employees are fully remote, agencies are still trying to figure out how to manage and retain hybrid and remote teams effectively.
Solution: Communicate regularly and use tools like Slack, Trello, and Zoom to streamline communication. Set clear expectations and define the responsibilities of each team member.
Market and Consumer Dynamics
The challenges discussed below are often spurred on by emerging trends, but some occur regardless of trends.
16. Dealing with Increased Competition
The competition among digital agencies is fierce, with new ones entering the market daily. With so many agencies battling clients’ attention, it’s challenging to stand out, win clients, attract talent, and grow your business.
Solution: Enroll in our mentorship programs at Prospecting On Demand to learn how to create unique value propositions and differentiate your services.
Our team of expert sales coaches will help you implement strategic business strategies to scale your marketing agency.
17. Responding to Shifts in Consumer Behavior and Preferences
It’s an agency’s ongoing challenge to stay current with the constantly evolving customer behavior and attitudes driven by technology advancements and cultural shifts.
Solution: Keep pace with data analytics to gain insights into consumer behavior. Continuously adapt to emerging digital trends, and train your team to create tailored strategies that relate to your clients.
18. Handling Global Market Dynamics
The global market is always changing the playing field.
Sometimes, staying on top of these global market trends — technology innovations, consumer behavior, political events, cultural norms, legal developments, and more — isn’t easy.
Solution: Analyze market dynamics to stay on top of emerging issues. Ensure your employees are up-to-date with the latest trends.
Ethical and Sustainability Issues
As seen below, agencies struggle to balance sustainability with market demands.
19. Sustainability and Ethical Advertising
Consumers today are informed and discerning, prioritizing agencies that align with their values.
Sustainability and ethical advertising have been getting louder and louder in recent years, and it’s a huge challenge for agencies.
Solution: Incorporate social, environmental, and social values in your business. Establish eco-friendly practices in your clients’ campaigns.
20. Coping with Shorter Campaign Lifecycles
Campaign stages include awareness, desire, intent, decision, and action. As such, agencies struggle to create the best strategy that converts prospects into loyal customers.
Solution: Set goals for each stage. Analyze different campaigns and focus on the most effective ones. Optimize the campaign based on performance.
21. Meeting the Challenges of Ethical Advertising Practices
Like other businesses, agencies must figure out how to incorporate social and ethical policies into their advertisements and campaigns.
Solution: Uphold honesty, transparency, user privacy, and inclusivity in your advertising. Incorporate environmentally friendly practices in marketing.
Conclusion
Running a successful agency takes a lot of work, and every agency has problems that must be solved. Therefore, take the insights from this article and adopt the solutions we’ve discussed.
However, you don’t have to suffer through these challenges alone. Get started on our mentorship programs to get personalized coaching — define your offer, implement practical selling strategies, and charge clients 3x more — for scaling your agency.
At Prospecting On Demand, we’ve helped over 150+ agencies attain 7-figure MRRs (and beyond), and we can help you, too. Schedule a free agency assessment and take the first step toward accelerating your agency growth!