As an agency owner, you’re constantly striving to stand out from the competition, grow your business, and provide the best possible service to your clients. And one of the keys to achieving these goals is through strategic planning.
Without a clear plan, it’s easy to find yourself struggling to manage your resources and differentiate your business from others in the industry. Which is why, it’s essential to develop an actionable strategic plan that separates you from competitors by identifying comprehensive business goals and executing them.
The result?
Not only does it help put in place a foundation of accountability and growth metrics, but strategic planning can be used as an effective tool to create unique customer value propositions that leverage your agency’s strengths.
We’ll explore the importance of strategic planning for agencies and provide a guide to setting your infrastructure goals, budgeting, and creating a unique differentiator.
By revamping your current strategies with smart planning practices, you can drive improved ROI through higher lead conversion rates while avoiding costly mistakes along the way.
Setting Your Infrastructure Goal
Setting up your infrastructure goals for the year is an important step toward success as an agency owner. It’s crucial to determine what investments you need to make to move your business forward and come out stronger than before. But where should you start? In this section, we’ll guide you through the process of setting an appropriate infrastructure goal for your business.
Establish Your Aspirational Goal
To make the right investments, it’s important to work backward and establish your aspirational goal.
What does success mean to you?
Do you want financial success… an amazing lifestyle company… or recognition for excellent work?
These questions should be considered when setting your ultimate vision. Starting here gives you a clear focus on where you’re headed and allows all other decisions to cascade from there. Once you’ve determined your aspirational goal, decide on smaller milestones that lead up to this ultimate goal.
Set Three-Year Goals
After establishing your aspirational goal, think about your agency’s three-year goals. These should be concrete objectives that are attainable in three years and put you on a path toward your aspirational goal.
When deciding your business strategy, consider factors such as desired revenue goals, average order value, and the number of clients. It’s also important to determine what distinguishes you from competitors and whether focusing on a niche is worth investing in for the next three years. These steps are building blocks that will eventually lead you to achieve your long-term aspirations.
Determine This Year’s “Infrastructure” Goal
Now, to hit long-term objectives in only three years, it’s important to make savvy decisions. This might entail building a recruiting infrastructure, investing in marketing strategies, or improving your existing service offering. Strategically investing in your unique differentiation now can help set you apart from the competition three years down the line.
Developing a Strategic Budget for Your Agency with 4 Key Goals
When you’re running an agency, setting up a budget is crucial to keep track of your finances and ensure you’re on the right path toward achieving your business objectives.
But when crafting your yearly budget, it’s important to keep four key goals in mind: revenue, profit, cash, and infrastructure.
Importance of Revenue
Your revenue goal should be the starting point when creating your annual budget.
To determine what’s achievable for the upcoming year, you’ll want to do a bottom-up analysis to consider factors such as current client relationships, market dynamics, and competitive pressures.
This will give you a better idea of how much revenue you can realistically expect over the coming year and form the basis of your budgeting process.
Setting Profit Goals
Once you’ve identified your expected revenue for the year ahead, it’s crucial to set a profit goal. While many agencies aim for a 20% profit margin, you may want to consider a lower target if you plan on reinvesting profits back into your business. This way, you’ll have more funds to take advantage of new investment opportunities that arise throughout the year.
Prioritizing Cash Flow
Cash flow is an essential component of any successful business, yet many agency owners fail to prioritize it when planning their yearly objectives.
To guarantee your firm’s long-term financial stability, you must focus on expanding your cash reserves and setting aside money for unforeseen expenses or rewarding opportunities that may arise during the upcoming year.
Investing in Your Infrastructure
Ultimately, your infrastructure goal is the investment that will set your business up for success in the long run. You should prioritize attracting new clients, preserving existing ones, providing current clients with additional services, and enhancing their capabilities.
To ensure that you achieve these objectives within your budget, create a detailed strategy on how you’ll allocate your resources towards these goals.
Identifying Your Unique Differentiator
With more than 120,000 agencies in the United States, it can be intimidating to make your agency stand out among your competitors.
But having a powerful differentiator is vital for success—this could be particular expertise in a specific area, a unique approach to marketing, or a special focus on customer service.
Whatever the differentiator is, it should be clearly recognized by your clients and prospects.
To help you decide if your agency has what it takes to distinguish itself from the competition, we’ve developed our Second Question Test.
The Second Question Test
This test is a simple way to determine what your unique selling proposition is, or if you need to invest more time into coming up with one that sets your agency apart.
Here’s how it works.
First, ask yourself the following questions:
What distinguishes your business from competitors? Oftentimes, we find that agency owners have similar answers to these questions—they boast about their excellent customer service, talented team members, or data-driven approach, but these are often generic statements that don’t truly differentiate them from other agencies.
Which then leads us to the second question of the test…
49 other agencies just said they have the same differentiator, so why are you better than those companies? This will help determine whether you have a truly unique selling point (USP) or not.
If you can answer the second question confidently, that’s great – you’ve found a true differentiator for your agency.
But if you’re having trouble, then it’s time to uncover what sets your agency apart. Remember, finding your unique selling point should be an ongoing process that requires continual investment.
Why You Need a USP
In today’s competitive industry, your unique differentiator is essential for your agency’s success. Creating a brand that stands out from others will help you attract new clients, retain existing ones, and build brand loyalty.
Passing the Second Question Test shows that you’ve done your research and identified an authentic way for your agency to stand out. Plus, your USP will give your potential clients more confidence in their decision-making process when choosing you and will allow you to grow and succeed.
A Cohesive Approach to Strategic Planning
By creating a cohesive approach to strategic planning, you can position your agency for long-term growth and financial stability in the long run.
Establishing your infrastructure goal, developing a strategic budget, and identifying your unique differentiator are all essential steps to consider in this process.
So, it’s worth taking the time to strategize and map out a clear plan.
See how strategic planning can take your agency to new heights with a free 30-minute demo of Engine.
With Engine, you can navigate the strategic planning process with confidence and streamline your financial infrastructure. Book today.