Apr 21, 2022
In Education Forum
According to the same study, only 14% of agencies stated that they have an integrated platform that gives them real-time insight into their key metrics. This basically means that agencies in 2022 still aren’t looking into their profitability that often. Zoja Ivanišević, Head of Development at Brigada, a spatial design agency: “At the end of each project, we'd do an evaluation in Excel to see our profitability. So we Cork Kids Bicycle Shop could never get the level of accuracy we have today. Before, we didn't have precise insight into how profitable a project was until we actually delivered it. Because our profitability evaluation would happen after a project was done, we could never figure out, mid-project, whether we'd see less profit or break a budget until it was in the past.” Sometimes, we'll hear paradoxical claims from creative agencies such as “Profitability isn't what we focus on” or “Profitability isn't our thing”. And sure, it shouldn't be your main driver as an agency that's aiming at shaping brand communications and delivering state-of-the-art digital products for clients. Without cash flow, creative work cannot continue or expand. Though agencies today are often integrated and deliver top-notch technology along with digital marketing services, many of them still lack an agency management platform to help them guide their profitability and operations. Maybe Agencies Simply Fear Losing Clients? A potential reason that agencies decided to work based on predefined project fees is that agencies fear losing work. If an agency is stuck thinking that changing its pricing model (or pricing in general) will lead to losing clients and income, it has a big problem. The same survey has shown that though agencies experienced a lot of chaos in the second quarter of 2020 , in 2022, agencies are back performing better than ever.