Niche Down to Level Up

Why Specialization is Key for Agency Growth

May 02, 2024

I recently had the pleasure of being interviewed about whether presenting your agency as a "Jack of All Trades" is a beneficial strategy.

Here are a few key takeaways:

🎯 Identify your agency's core strengths and focus on specific services or sector

📣 Rather than emphasizing a broad range of services, agencies should lead with their core expertise.

💡 If you want people to buy your "strategy", then they have to see how you think e.g., publish insightful content, participate in podcasts, speak at industry events, etc.

Check out the full interview (it’s long) below to learn more about my thoughts on positioning your agency for success.

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Here is the unabridged version…

1. To kick off, could you introduce yourself and share your expertise in coaching agencies, particularly in guiding them through strategic decisions like whether presenting as a “Jack of All Trades” is a beneficial approach?

Certainly! I’m Jeff Meade, a management consultant to owners of marketing agencies. I help small to mid-sized marketing services firms (advertising, digital, experiential, and public relations) refine their client acquisition strategies, take control of their operations, and significantly enhance their profitability.

Regarding the debate on specialization versus adopting a “Jack of All Trades” stance, my advice consistently leans towards focusing and specializing.

Are you familiar with the parking space theory in marketing? Imagine a ‘parking lot’ where clients are metaphorically circling, searching for a spot to ‘park’—that is, a business to engage with. The challenge for agencies is to make their ‘spot’ as easy and appealing as possible for potential clients to choose.

This parking space represents your niche—what you aim to be recognized for more than anything else. Spots attempting to be everything to everyone tend to be less appealing.

2. Positioning matters in the agency landscape. What are the potential advantages and disadvantages of presenting an agency as a “Jack of All Trades,” and how does it impact client perception?

When an agency presents itself as a “Jack of All Trades,” also known as a “full-service agency,” it’s essentially signaling a broad capability set, aiming to meet a wide array of client needs. This approach has its advantages and disadvantages, shaping client perception in nuanced ways.

Here are some advantages:

One-stop Shop: An agency that positions itself as a “Jack of All Trades” can be highly attractive to clients who prefer to partner with fewer agencies, simplifying their coordination and communication efforts.

Broad Appeal: You cast a wide net, appealing to a diverse client base with varying needs, looking for comprehensive solutions under one roof.

Flexibility: It showcases an agency’s adaptability and readiness to tackle various challenges, positioning the agency as a versatile partner in clients’ eyes.

Here are a few disadvantages:

Resource Strain: Trying to be everything to everybody can stretch an agency’s resources thin, affecting the quality of work and leading to burnout among team members.

Perceived Lack of Specialization: Clients seeking experts for specific challenges might view the agency as a master of none, potentially leading to doubts about the agency’s ability to deliver specialized outcomes.

Difficult Differentiation: Standing out becomes a challenge when you’re competing against both specialized boutiques and other generalist firms. It can dilute your brand and make it harder to articulate a unique value proposition.

Impact on Client Perception:

Specialized agencies often benefit from the perception of deeper expertise in their niche, which can be a decisive factor for clients facing complex, industry-specific challenges.

The value proposition of being a “Jack of All Trades” hinges on convenience and a range of services. For some clients, especially smaller businesses or those with less clearly defined needs, this can be a strong selling point. It positions the agency as a flexible, responsive partner capable of adjusting to a variety of challenges.

This question is really about striking the right balance between breadth and depth, ensuring that the agency can attract prospective clients and deliver value to them.

3. Specialization is often encouraged. In your coaching experience, how do you guide agencies in finding the balance between being versatile and specializing in a niche market?

Guiding agencies to find the right balance between versatility and specializing in a niche market involves a nuanced approach, one that aligns with the agency’s strengths, market demands, and long-term vision.

It’s important to understand that being versatile and specializing in a niche market are not mutually exclusive.

Here’s how I approach it:

1. Identify Core Strengths:

The goal is to identify what they do best and what sets them apart from the competition. Sometimes, an agency’s strengths can lead naturally into a niche that they haven’t fully capitalized on yet.

2. Understand the Market:

Agencies should have a good understanding of current trends, client needs, and where the gaps are in the marketplace.

3. Assess the Competition

Understanding the competition and what they offer can highlight areas where an agency could specialize to create a unique value proposition.

4. Experiment and Iterate

I often encourage agencies to experiment with their service offerings. As much as you want to specialize, you also have to be on the lookout for new services that solve new client needs.

Think about it like this: once you’ve solved one problem for your client, they will inevitably face new growth challenges in the future.

By carefully iterating your agency’s focus, you can create a unique position that leverages your strengths and effectively meets market demands.

4. Which agencies have you mentored in the past, and who are the founders of these agencies?

For privacy reasons, I do not share the names of the agencies I work with. There are, however, multiple testimonials on my website from past clients.

5. How can agencies effectively communicate their broad range of services without diluting their brand identity when positioning themselves as a versatile agency?

To communicate a broad range of services without diluting brand identity, agencies should:

1. Lead with Core Expertise:

Clearly demonstrate how your expertise is delivered through your main offerings.

2. Use Case Studies:

Showcase diverse projects with case studies.

3. Communicate a Strong Value Proposition:

Clearly articulate how a versatile approach allows you to deliver unique value to clients.

6. Client expectations vary. How can agencies manage client expectations when presenting themselves as a comprehensive service provider, ensuring they can deliver across diverse project requirements?

First, it’s important to remember that you can’t be all things to all people.

Second, I advise focusing on and agreeing upon the specific outcomes your client wants to achieve with their project. Rather than positioning your agency as a one-stop shop for a broad range of services, emphasize your expertise in delivering specific outcomes.

Here’s how this would play out in real life:

Clear Communication: Be very clear about the outcomes you can deliver. This will ensure that you and your clients are aligned from the start.

Set Boundaries. Clearly outline what is within the scope of services and what isn’t. This helps manage expectations and prevents scope creep.

Transparent Process. Show clients that you have a process and keep them informed about the project’s progress along the way. Folks get nervous when they don’t know what’s going on. Transparency builds trust and helps you adjust expectations if needed.

By focusing less on being a comprehensive service provider and more on being experts in achieving specific outcomes, agencies can better manage client expectations and ensure they can deliver across diverse project requirements effectively.

7. Client testimonials play a role in building trust. How can agencies showcase client success stories and testimonials when their service offerings are diverse?

Whether the service offerings are diverse or not doesn’t matter for the purposes of client testimonials.

Testimonials validate your expertise and prove you can achieve specific outcomes. They should be used less to hype up a particular service and more to illustrate the unique value that you provide.

8. Competition is fierce. How do you guide agencies in differentiating themselves from competitors when positioning as a “Jack of All Trades”?

Typically, I advise my clients that they have three primary ways to position themselves and stand out to their target audience:

Excel in a specific service
Specialize in a particular sector
Combine excelling at a specific service with specializing in a particular sector

Service-led positioning is a common strategy among marketing agencies. It involves specializing in specific marketing services or demographics, such as experiential marketing, social media marketing, or targeting seniors, while catering to a diverse range of industries.

This approach allows agencies to capitalize on their unique skills and, ideally, to leverage proprietary methods to stand out in the market.

Sector specialization, on the other hand, involves tailoring your services to meet the specific needs of a particular industry.

By adopting this strategy, an agency can elevate its role from simply being a service provider—akin to an order-taker—to becoming a strategic advisor, much like a Sommelier, who is essential and valued for their expert knowledge and guidance.

9. Project scoping becomes complex with varied services. How can agencies effectively scope and plan projects when offering a broad range of services, and what challenges should they be mindful of?

Effectively scoping and planning projects with a broad range of services requires a meticulous approach so you don’t lose your shirt.

In-depth Discovery Process: Begin each project with a discovery phase to thoroughly understand the client’s needs, expectations, and desired outcomes.

Documentation: Maintain clear and continuous communication with clients and document every aspect of the agreed scope, including deliverables, timelines, and assumptions.

Regular Reviews and Adjustments: Incorporate regular review checkpoints within the project plan to assess progress against the scope. Be prepared to make adjustments as needed.

The two biggest challenges to be mindful of are scope creep and profitability. If resources aren’t allocated efficiently across projects, then project profitability and, ultimately, agency profitability will suffer.

10. Flexibility is key. How do you advise agencies to adapt their strategies if they notice that positioning as a “Jack of All Trades” is not yielding the desired results?

I recommend against the “Jack of All Trades” positioning. I prefer a more focused approach. Here’s how I would advise someone to make the switch:

Identify Your Strengths: Assess your agency’s past projects and client feedback to identify your strengths. This analysis can guide you towards services or sectors where you excel and can differentiate your agency.

Narrow Your Focus: Based on your strengths and market needs, narrow your focus to specialize in areas where you can provide unique value.

Invest in Expertise: Build or enhance your team’s skills in the areas you choose to specialize in. This might involve training, hiring new talent, or collaborating with experts.

Update Your Messaging: Ensure your website, portfolio, and all marketing materials reflect your updated focus. Highlight success stories and case studies that showcase your specialized expertise.

11. In terms of market trends, do you foresee any shifts that might impact the effectiveness of presenting as a versatile agency, and how can agencies stay ahead of these changes?

Yes, current market trends indicate an oversupply of agencies, leading many businesses to commodify their relationships with these agencies.

With many agencies appearing indistinguishable, clients often default to cost as their deciding factor, assuming they’ll receive similar services regardless of the agency they choose.

Agencies should adopt a more focused approach to stay ahead of these changes. This allows them to clearly differentiate their services and value proposition, moving away from competing solely on cost and towards providing specialized, high-value solutions that clients recognize and are willing to invest in.

12. In the context of presenting your agency as Jacks of All Trades, what strategies do you recommend for agencies to maintain visibility and relevance in today’s fast-paced digital landscape?

I recommend leveraging Thought Leadership as a key strategy. Here’s how to implement it effectively:

Publish Insightful Content: Regularly produce and share insightful content that addresses current industry trends, challenges, and innovations. This could be through blogs, industry publications, or social media posts that reflect your agency’s broad expertise and insights.

Podcasts: Organize your own or make guest appearances on others’ podcasts. This will showcase your agency’s diverse capabilities and position you as a hub of knowledge and innovation.

Participate in Industry Events: Speaking engagements or panel participation can significantly boost your agency’s visibility and establish your team as experts across multiple domains.

13. Do you believe agencies can benefit from strategic collaborations or partnerships to enhance their versatility, such as leveraging the Cloudways Agency Partnership Program?

Yes, I believe agencies can always benefit from strategic partnerships.

14. In conclusion, drawing from your coaching experience, what practical advice would you offer agencies considering the strategy of presenting themselves as “Jacks of All Trades” in the industry?