Hope you’re going strong in these interesting times.
I’m writing this from the Northern Virginia/DC area where I’m self-quarantining with family after a somewhat harrowing escape from Buenos Aires; I managed to get out just before the city went on enforced-quarantine after an ahead-of-schedule midnight decree from the Argentine president.
Before my exodus from the land of steak and Messi, I reached out to Tim Conley, a B2B services-focused business coach with whom I’ve been acquainted for several years, to weigh in on the recession and its possible effects on marketing agencies. I went outside of our normal production process to get Tim on sooner rather than later, and I had to record on my iPhone from my AirBnB, so please bear with me on the a/v quality!
Tim has the perfect bonafides for this topic - he's worked with over 400 entrepreneurs in his two-decade career, and he started and sold a services business in the midst of a recession. Tim’s style is tough love, which is perfect for tough times.
Some things we covered:
The return of project-based revenue. A back to basics approach for weathering the storm. Why the agencies who talk to their clients will survive and thrive.The danger of too many services. Why specialization doesn’t necessarily mean niching.
Links: Tim Conley’s YouTube Channel (it’s awesome)
Esprit de l’escalier...= “the spirit of the staircase”: the things you wish you said after you left the room. This is best understood in context after listening, so recommend doing that first.
Tim argued that it’s better for agencies to specialize by service and then select key industries on which to focus, instead of niching by industry as a starting point. As he says, it’s risky to focus on industry-first because if your space goes belly-up, you’re done for. It’s a scary time for restaurant-focused agencies, for example. Plus, service-first allows you to be the best in the world at something. It’s highly-defensible.
Where I disagree:As Richard Hell and the Voidoids once sang, “It’s such a gamble when you get a face.” There’s risk in everything. When you specialize by niche, your industry could get sick. When you specialize by service, platforms and market forces (among other things) can also take you down. Think back to the effect of algorithm changes on SEO or globalization on creative services (something I experienced first-hand selling animated video services).
I think Tim and I are in agreement that specialization does not exist by service or niche alone but at the cross-section of these things. The answer is probably sharpening your knife on one-to-a-few key services for one-to-a-few key industries. It’s entirely on me for not bringing this stuff up live, and hopefully, we can get Tim on in the future to dig deeper into this.