At the very bottom of Maslow’s hierarchy of needs is survival – focusing on the absolute basic requirements to stay alive. The rules for survival are simple, do whatever it takes to continue your existence. Survival is your only focus and all your decision-making is exclusively governed by this over-arching requirement. This is the world into which almost all marketing agencies are born, and sadly, where too many remain trapped.

My advice to any agency owner in survival mode is to do whatever it takes to survive until next month. Discount your rates, hire cheap juniors, say yes to any work available, say yes to any client request, do as much of the work yourself as possible – whatever it takes to meet your basic revenue requirements while keeping your costs at an absolute minimum. If you’re fighting to survive, this is what you do.

Here’s the bad news, if you want to escape survival mode, my advice is to NOT do any of the above. The decisions you make to ensure you survive will trap you in survival mode.

Agency owners have two resources available to them, time and money. When you first get started you have an abundance of time and a scarcity of money so you ‘pay’ for things with your time. Money is more important than time so you save money by spending time. 

The three biggest time requirements in an agency are:

  1. Operational administrative tasks
  2. The delivery of client work
  3. Overseeing/managing employees

When you have an abundance of time you do all the admin tasks yourself instead of paying someone else, you do as much of the client work as possible instead of hiring, and when you do hire, you hire cheap people who cost little cash but lots of your time. (Cheap employees cost little cash lots of time, expensive employees cost lots of cash but little time. Most employees cost the same, you just pay them with a different mix of time and money). 

In order to move your agency out of survival mode, you have to abandon the survival decision-making rules completely. You must scope and quote properly, you don’t discount unreasonably, you don’t take on just any client, you hire senior people (lots of cash, little time), you outsource and delegate, you charge for scope creep, and you protect your time at all costs. Your time must become far more important than money.

If you’re unable (or unwilling) to change your decision-making rules you’ll end up in the agency death trap where you have neither money nor time. You’ll become cash and time-poor. You have over-demanding clients who pay low rates and suck up all your time. You have a hundred responsibilities and tasks each month and you can’t afford to outsource admin tasks or hire good enough people to delegate work to. You can’t increase prices because you can’t afford to lose a client and you always have to discount because you desperately need the new business. For agency owners trapped here, it’s a place worse than hell.

You cannot escape survival mode using the survival decision-making rules you needed when you started! At a certain point, you have to bite the bullet and stop the madness. Start scoping and quoting correctly, at decent rates. Only accept work on these terms. Force existing clients onto decent rates and charge extra if they suck up your time. If you lose, let them go to a competitor that’s willing to stay in their own survival mode. If you win, use the money to buy back your time by hiring good people who need less of your time, and pay to outsource administrative functions.

Use the time you buy back to improve your services and ensure you retain your high-paying clients. Use the time to replace the clients who refuse to move to the correct rates. Use the time to generate an abundance of new leads. Use the time to rest. Use the time to upskill your people. Use the time to specialize in higher-paying services or faster-growing industries. Use the time to improve your own skills as an agency owner to ensure you never have to back to survival mode. 

The decision-making rules that helped you survive are the very things keeping you trapped in survival mode. You have to change the rules, and in order to do that you need time, and in order to get the time you have to change the rules. If that sounds like a trap it’s because it is. You either spend money you don’t have to buy back the time required to escape, or you use the time you don’t have to do the work required. Either way, if you’re in this trap, you have work to do. And if you need help, let me know. I escaped the trap in my own agency and since then I’ve helped many other agency owners escape it too.