Independent Agencies and the Internet: Aligning with Your Business
Act cFluent Newsletter, October, 2005 - Subscribe today Subscriber benefits include early evaluation of new products and discounts.
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By now most of us have heard that our agency needs to be on the web. That's a little bit like saying everyone needs a pair of shoes. What style? What color? What size? What material? Those questions need a context: there is no one right answer. Where will the shoes be worn and with what, who will wear the shoes and for how long are all relevant considerations.
In much the same way, your unique agency, your vision, budget, staff and target market are all contexts that need to inform what to do with the internet. It is true that nearly any agency can benefit by using the web but how to use it depends on your agency context.
Management follows a certain hierarchy from general to specific. For instance, a Mission Statement is necessarily general, allowing for a business to adopt different objectives and strategies in different time frames as conditions change. As Jim Collins pointed out in his book Good to Great, Mission Statements should change very infrequently.
At the other end of the scale are tactical elements like Procedures. These can change quite often as business conditions require. Guiding changes to procedures are higher level management directives like Mission and Strategy.
Internet tactics and agency web sites are no different. There is no right answer to what kind of web site you should have and how you should use your web site except in the context of your individual agency. Consider the two following agencies.
Both agencies can benefit from the internet but need very different solutions to line up with their unique situations and strategic decisions. Web decisions need to align, from the top down, with Mission, Management Philosophy and Operational Style (PDF).
There are really two ways to think about the internet as a business expense. Your approach to the internet may be to generate leads and write business and in that case you would think of the internet as a business development expense. Alternatively, you may want your web site to provide service to current customers. These could be new or existing services you are migrating to the web. In either event you would think of the cost as an operations expenditure.
More specifically, you could think of the web as advertising and promotion expense or an information technology expense. The truth is most of the time costs are actually a blend between the two. According to IIABA's 2005 Best Practices survey, agencies spend between 2.0% and 5.6% of revenue for these two expense areas combined. Money you devote to a web site, tools and content, internet promotion really come from this pool.
There are some additional expenses that you should expect to incur when doing business on the web and those are in the area of promoting what you have to offer. The costs should be small and web site promotion can often be incorporated into other campaigns and activities. But, unless you have a plan to promote what you are doing on the internet you are not really using the internet. There is a difference between using the internet and having a web site and that difference is the difference between business results and lack thereof.
Done right, a web site and internet activities should not include hidden technology costs. Outsourcing hosting can shift the burden of support to professionals who are dedicated to internet technology and can be advantageous since a good hosting company will have added security and redundancy for disaster situations.
Web marketing investments can deliver very high returns; internet marketing campaigns also can be tracked far better and more easily than most traditional programs. Just the same, your agency may not be in a position to shift budget money from lower pay-off initiatives at the present time. In that case you might want to start small and scale up. Different stages of web use have different characteristics, costs and paybacks (PDF). Three things should be kept in mind if you take this building block approach. The first was covered in the first part of this newsletter: make sure what you want to do with the web is consistent with the kind of agency you have. The second is to make sure that each step moves you closer to achieving whatever strategic objective you set for your self. The third is to be sure that early solutions can be built upon, that you do not have to start over and incur expenses anew.
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