30dps Blog


Understanding the True Value of Agency Work

[fa icon="calendar"] Apr 28, 2017 4:14:38 PM / by Jeff Thomas


Establishing value in any business can be a challenge. And marketing and advertising agencies, I believe, have a special challenge due to the nature of the industry, i.e. how well an agency does its job directly effects how a client's business is perceived in the marketplace. There is little doubt that the combination of DIY website tools, freelance websites, WordPress templates, and a glut of newly-skilled and eager, young, graduate graphic designers and web developers presents consumers with lots of choices. So in light of that, why, the questions go, are agencies so bloody expensive?

A Fair Analogy

I recently got an estimate from a floorman by trade that was referred to me by a trusted friend who spoke extremely highly of the gentleman. I met him at my home, and together we worked through the proposed project. When I began the process, I had a pretty small project in mind, but as we discussed my actual needs, the scope increased. Unfortunately, I still had a dollar amount in mind that was largely influenced by my original assumed scope of work. So when the bid came in, it took my breath away. How could this possibly be right? Heck, I could do this work for a fraction of that price, or at a minimum, find someone cheaper. I was tempted to ask the vendor if he could sharpen his pencil and come up with a better price (or at minimum, I wanted to whine about the price)... but then I was hit with the oppressive feeling of conviction. I was about to respond to this professional with the questions and complaints that too often cause a lump in our combined throats as an agency. Ugh!

After some introspection, I called the flooring guy and told him we'd do it. But the angst that came from the initial price tag was indeed real. So why DID it all cost so much? As I reflected upon it, I realized that his reasons were almost exactly the same kinds of reasons agencies have for charging what they do. I am going to express these things in the context of the flooring guy and leave it to you to make the correlation to marketing services, creative services, and development services that agencies (like ours) provide.

  1. While I had initially presented the project as small and simple, the tradesman—by asking questions and establishing a larger need (that he was also able to satisfy)—legitimately exposed the scope to be significantly more than I originally assumed (and had communicated at the outset to the vendor).
  2. The professional understood the many nuances of the project that I had largely failed to see—things like the need to remove and replace trim, for example. It made sense that the things he pointed out needed to be done, but I sure hadn't banked on them in my earlier assumptions of cost.
  3. While indeed I could have taken this project on (I fancy myself to be a bit of a handyman), this professional who does this kind of work everyday would know exactly how to handle almost every unexpected thing that could come up. And for most of those challenges, I wouldn't have had a clue as to how to approach them. So he smartly baked that kind of expectation (the expectation that stuff happens) into the bid.
  4. I realized early on, as I considered taking on the project myself, that I would probably need help. Not only does it help lighten the load, a second person can often help you catch mistakes before they become costly. But undoubtedly, whomever I got to help me would likely be minimally experienced, like me, or possibly be someone who had done flooring once or twice. My flooring guy has an entire team of folks who do this every day, each of whom likely has a specialty, which not only improves the overall quality of the end product, but also minimizes mistakes and reduces the total project timeline.
  5. The truth is, I didn't want to have to worry about the project being done right. While I'm pretty handy, invariably stuff does happen, and I generally find some workaround or make-shift "solution" that a professional would have never done. Ultimately, the end result wouldn't have been as good as it almost certainly will be by having an experienced professional do the work.
  6. I really wanted to be able to count on the project to be done in a timely manner, especially once the project begins. Delays in the schedule are sometimes unavoidable, but never appreciated. As my wife, Jill, would attest, I almost always find ways of dragging home projects out for days, if not weeks, beyond my original projection.
  7. I have bought a number of quality tools through the years, but some of my tools are not of professional grade. And the truth is, I don't have some of the tools I would have needed for this job. If I had decided to take on this project myself, I'd have needed to buy or rent some of those tools (which I am unlikely to need again any time soon) and some of those tools can be pricey.
  8. When I take on home projects, I never take into account the amount of time it takes to prepare everything... how long it takes to move everything out of the way, to protect everything surrounding the project area, to gather all of the tools, and prepare the work surfaces. Sometimes, that stuff takes longer than the project itself. But I never plan on it from the outset. I also never think about how long it will take me to tear everything down; to clean everything up; to put the tools away; to store them or return them.
  9. I also don't think through the cost in terms of wear and tear on the tools that I own; how often I will have to replace a blade or a bit, or even the cost of nails and glues.
  10. I had asked a trusted friend for a reference on someone she trusted to do this kind of work, and she wholeheartedly referred me to this professional without hesitation. And, in my interview/walk-through with him, he earned my trust. He clearly knew what he was doing. I could have sought other bids, and in some cases, I do exactly that. But in this case, I had a very clear, compelling, and trustworthy testimony from a happy customer.

Wrestling with "Fair"

I said that I'd leave it to you to make the correlation to what an agency charges and why the cost may seem high. But I will offer this: Agencies that have been around for a long time have a lot of experience. That experience not only means that their team is seasoned and likely well-paid, but more importantly, it means that they are likely true experts in their field. They understand that their prospective customers have options, and thus they are compelled by the laws of supply and demand, to bid projects fairly (just as I'm sure my flooring guy was). Nobody wants to pay more than they have to for any product or service. But interestingly, we all assume that WE are worth every penny we charge for our services (or perhaps, feel that we aren't paid enough), and it's always the OTHER GUY who is charging exorbitant rates for their expertise. So how do we determine "fair" pricing or whether an agency is charging too much? Ultimately, it may come down to how much you can pay or are willing to pay. I'd love to own a Mercedes, and Jill would love to own a Lexus. They may be fairly priced (because they are of exceptional quality, I hear) but if I can't afford it, well... I can't afford it. But I don't knock the local Mercedes and Lexus dealers because of my inability to afford their goods.

Why We Became a Marketing Agency

Having explained (through analogy) why agencies appear to charge so much, let me also say that one of the reasons we became a marketing agency is that we saw some high-flying advertising agencies that really did charge outrageous rates, and they marked up everything they touched by outlandish amounts. Our desire was to produce an agency that would charge fairly for exceptional work.

A reputable, quality agency that wants to stay in business will always do the right thing, even if it means (at times) taking a loss. But if they are committed to excellence, you will find that they also deliberately choose to charge enough to cover all of what it takes to offer an exceptional service (for instance, copy editing, proofing, iterations, refinement, archiving/de-archiving files, a/b testing, etc.). They won't lure you with promises of low costs, and then gouge you later for every "unexpected" dilemma. Just like my flooring friend, your agency should build into their pricing the labor and material costs for doing a quality job the first time.

If you have been referred to us by one of our happy customers and are looking to grow your business by increasing your website traffic, and improving your sales leads and conversion rates, we would be happy to offer you a free consultation in order to see if our agency is a good fit for your needs, whether it be for inbound marketing, content marketing, web design, or creative services.


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Topics: Marketing & Advertising Agencies

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