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Factors That Influence ROI When Working With a Marketing Agency: How to Achieve Positive ROI

Discussing ROI or Return on Investment is an inevitable part of the conversation when considering a partnership with a marketing agency. It’s a valid concern; you’re about to invest a portion of your budget, and naturally, you’d expect to see a return that justifies this expenditure. However, the grey area appears when the talk turns to guarantees on ROI. In an ideal scenario, every dollar spent on marketing would translate to a predictable amount of revenue. Yet, the reality is, marketing, much like many other business endeavours, comes with its set of uncertainties. So, why is it that agencies shy away from guaranteeing ROI?

  • The Mindset Shift You Need Right Now
  • What Does ROI Actually Mean? 
  • Factors Influencing ROI When You Work With An Agency
  • How to Make Sure You Generate ROI
  • So, What’s Next?
  • The Mindset Shift You Need Right Now

    Meme showing a man screaming on phone with text on image "Show me the return on investment"

    Have you ever been burned in a romantic relationship? It hurts, right? 

    Yet, if that experience stops you from trusting anyone ever again, you might miss out on finding true love. 

    Similarly, if a past engagement with an agency left you feeling short-changed, being overly cautious could hinder the potential success awaiting with another agency. 

    It’s easy to build walls, but sometimes, those very walls block out the opportunities

    This is where the power of positive manifestation steps in. By shifting your mindset and being open to possibilities, you lay down a fertile ground for achieving the ROI you desire. 

    The analogy here is simple but impactful; holding onto past disappointments may lead to a continuous cycle of missed opportunities. 

    Although, it’s easy to say that, isn’t it? The reality is that when you’re hurt, disappointed and when your trust is broken, it’s not so easy to trust again. 

    But the hard truth is that if you want to build a strong brand and you need marketing expertise, then you will have to trust again, in the same way a heartbroken person must trust again to ever experience the love they deserve. 

    While this is true, this time around, equip yourself with the knowledge you need to make sure you work with the right agency. If you do this, then you’re a step ahead of the last time, and that much closer to getting what it is you want. 

    What Does ROI Actually Mean? 

    Every marketing agency (and their customers) throw around this term as if it means the same thing to everybody. But the reality is that it doesn’t. Let’s define it, to make sure we’re talking about the same thing. 

    ROI, standing for Return on Investment, in a brand-agency context, is essentially what value you get in return for the money you spend on marketing efforts. 

    A positive ROI means you generate more revenue, directly attributed to the agency’s marketing activities, than what you spend both on the agency and the associated costs (such as advertising spend). 

    It’s not just a one-sided expectation; it’s a mutual goal where both you and the agency aim for a positive ROI. This mutual objective sets the stage for a collaborative effort, aligning strategies and expectations right from the beginning.

    The journey towards achieving positive ROI should be seen as a joint venture. It requires a shared understanding and commitment to work through the strategies, measure the outcomes, and tweak the approach as needed to ensure the marketing efforts are indeed paying off. 

    Before diving into the factors that influence ROI, having this shared understanding sets a positive tone for the brand-agency collaboration that you seek. 

    Factors Influencing ROI When You Work With An Agency

    Before you even ask the question ‘Can you guarantee me ROI?’ you should be asking what factors influence ROI. If you can control these factors, then you should be able to control the ROI that you achieve. 

    The main factors that influence ROI include: 

    • Your investment
    • The Strategy
    • Low Quality Content or Bad Messaging
    • How Much The Agency Cares
    • Alignment of Expectations
    • Realistic Goals
    • Poor Timely Feedback 

    Your Investment

    You think you’re negotiating when you try to lower an agency’s prices. The reality couldn’t be further from the truth. 

    Agencies offer a particular price because that reflects what they believe to be the value provided. When you haggle the agency to a lower price, you might find that the value provided doesn’t align with your expectations. 

    You see, agencies might offer a lower price to secure you as a client, just to get you through the door, you know? But this could mean less effort is put into your campaign. And less effort translates to less ROI. The saying “you get what you pay for” rings true in this scenario.

    You do want to be careful though. Some agencies might overcharge you just because they know you’re a bigger company. This is easy to look out for though – agencies that don’t offer a pricing page on their website probably change their prices according to the size of the client. And these are the agencies you’re going to want to steer clear of. You can check out our pricing page here.

    So to sum up, first find an agency that has a pricing page on their website. Then, once you’ve found them, don’t try to haggle them down to a lower price, unless you’re willing to accept a lower value, and therefore a lower ROI. 

    This is one of the biggest reasons for a lack of ROI. 

    The Strategy

    If the agency doesn’t have a solid strategy from the get-go that includes things like sales funnels, lead magnets, multi-stage advertising campaigns with TOF, MOF and BOF stages clearly outlined, email marketing automations, and content creation, this might be a red flag.

    In fact, your agency should be talking about this with you before you even start working together. Do note that depending on your level of expertise, your agency might choose to go into less details on all of these things. However, they should at the least mention them, and you should be aware that they’re part of the plan. 

    Today, anyone can start a marketing agency and sell to clients. More often than not, the reason for lack of ROI when brands work with agencies is due to lack of experience or expertise on the agency side resulting in poor strategies. To combat this, you should look out for some of the keywords mentioned above when talking with the agency about what execution items might be included in their plan. 

    An agency might say ‘Oh, we won’t know what plan to use until we actually sit down and strategise for your brand, which takes time from our end to do’. This is a load of cr*p. 

    When an agency tells you this, simply say, ‘No worries. What are all of the potential execution items that might be included in a plan or strategy when you typically work with a client? I understand that these might not apply to me after you actually create a strategy, but I do want to have an idea on what it could potentially look like’. 

    If an agency tries to avoid the question or can’t give you a clear answer, then you’ve got your answer – the strategy they do end up employing probably won’t get you ROI. 

    Low Quality Content or Bad Messaging

    Sometimes, even when everything else is right, if your website, your image and video content, and your messaging in your copy isn’t on point, then you’re likely going to fail to achieve a positive ROI. 

    The reality is that you need strong video and image content and powerful messaging that resonates with your audience in order to convert. 

    Ask yourself, do you currently have that? If you don’t, then do you need your agency to help you build that? 

    You might be excited to produce positive ROI right now. But the thing is, if you don’t have the content in place to achieve this, you’re going to burn money. So, you probably do need to invest in content. 

    Don’t have the resources to pay an agency to do it? Ask your agency to guide you so that you can create the content yourself as part of the project. Then, your agency can focus on the advertising aspect. 

    All in all, one of the reasons we see many clients coming to us complaining that they didn’t achieve positive ROI is because they didn’t want to pay the extra fees to their last agency to produce the content they needed to convert customers. It’s as simple as that. 

    How Much The Agency Cares

    I got off a call with an agency owner today who said this to me: “Sorry I’m 2 minutes late. You know what it’s like, always trying to jump off calls with annoying clients, but they always have something to say.” 

    I don’t know about you, but this leaves a bad taste in my mouth. 

    Agencies are supposed to care for their clients. After all, the clients are paying for a service right? But unfortunately, this isn’t the case with a lot of agencies. 

    Some are just out for a quick buck. And some are so large that the employees you’re dealing with just don’t care about you – all they’re thinking about is how many minutes are left till 5pm. 

    So, when you work with an agency, make sure you’re working with people that care. People that have a similar vision to you. People that have similar values. You want to make sure that your agency cares about you, because if they don’t, you’ll be lucky to get a positive ROI. 

    Aligned Expectations

    It’s vital that both you and the agency have aligned expectations regarding the goals, the timeline, and the measures of success (how your agency is measuring success. For example, success to your agency might mean a high CTR, but success to you might mean more money in the bank than last month). 

    It’s easy to get excited when working with an agency. 

    But the best thing you can do, if you want positive ROI, is to take a step back, and cross check the alignment of your and your agency’s goals, timeline and measure of success. 

    Realistic Goals

    If you’re reading this article you probably have a goal in mind in terms of what you expect to achieve. Is your goal realistic? Who else do you know who has achieved a goal similar to you, in a similar industry, and with a similar budget? 

    You need to make sure your goal is realistic. For example, if you’re expecting a positive ROI in two weeks (which we have personally achieved with certain clients before), you need to make sure it’s actually realistic for your industry. Perhaps in your case, achieving a positive ROI after three months is a more manageable goal. 

    Aligning your goal with your agency is an important step. Check with your agency that they think your goal is realistic. 

    Poor Timely Feedback 

    Perhaps you’re already working with an agency and not seeing positive ROI. It could be because of poor timely feedback. 

    Your timely feedback is important. Sometimes, results may move slower simply because you’re moving slower. When your agency asks for something, do you get it done, or does it go on the backburner, never to see the light of day?

    How to Make Sure You Generate ROI

    Entering into a collaboration with a marketing agency is a significant step, and ensuring that this step leads to a positive ROI involves a blend of the right mindset, clear communication, and realistic expectations. 

    Here’s how you can work towards generating ROI from your partnership with a marketing agency:

    Be Willing to Invest

    Investment is the fuel that drives the marketing engine. Without adequate investment, it might not be the right time to work with a marketing agency. It’s crucial to have a budget that aligns with your goals and the scope of the campaign.

    Before working with your agency, ask them what they recommend you spend on advertising and what services they recommend you engage in to generate a positive ROI as quickly as possible. 

    Once you get your answer, you need to decide – either invest now, or wait until you’re ready to invest. Or, ask your agency what the bare minimum is you need to get results, and then invest in just those things. 

    All in all, you need to be willing to invest. No one is going to give you positive ROI for free, or for commissions. And if they do, they’re probably desperate, which isn’t a good sign, right? 

    You might try to delay paid ads as a way to get to a place where you’re comfortable to invest. However, this might not be the best option. Find out why delaying paid ads could be doing more harm to your business than you thought.

    Understand that ROI isn’t guaranteed

    Marketing, by nature, involves a level of risk and unpredictability. It’s important to understand that no agency can guarantee ROI, but with the right strategies and a collaborative approach, the chances of achieving positive ROI can be maximised.

    We do have a guarantee ourselves. If we can’t get you a sale within the first three months of working together, you get your money back, excluding any advertising or software costs (i.e. mailchimp, domain name costs, etc). We’ve never had to use this guarantee before. 

    When it comes to positive ROI, we simply don’t guarantee this, because some businesses achieve a positive ROI quicker than others. And, well, when businesses work with us, they’re happy with the results they achieve. If an agency is guaranteeing you ROI, you might want to question whether it might be too good to be true. 

    Setting Realistic Goals and Expectations

    Establishing realistic goals and having clear expectations from the onset can contribute to a smoother journey towards achieving ROI. 

    It’s about setting a clear roadmap and being on the same page with your agency regarding the goals and the metrics of success. How much ROI do you want to see? When do you want to see it by? How many sales do you think you can get by x time period? 

    These are the sort of questions you want to answer with your agency. If you can both agree to the goals, then it’s probably realistic. 

    Running Your Campaign for at Least Three Months

    Marketing campaigns need time to gain traction. A duration of at least three months allows for enough data collection, analysis, and optimisation to improve the performance of the campaign.

    It may even take longer if content or other assets like landing pages or websites need to be developed. 

    Do note that sometimes, it doesn’t take three months. We’ve had cases of positive ROI within two weeks. This might not be you. You might need three months. You might need six months. Ask your agency how long they think it will take.  

    Picking the Right Agency

    The agency you choose to work with can significantly impact the outcome. Here’s a guide on 9 Red Flags to Look Out For When Choosing Your Marketing Agency.

    So, What’s Next? 

    The road to achieving a positive Return on Investment (ROI) is a shared journey between your brand and the marketing agency. Success in this realm is not a solo gig, but a collaborative effort driven by mutual goals, open communication, and a continual process of learning and adaptation.

    Remember, an agency’s success is intertwined with your success. If the agency fails to help you achieve a positive ROI, they lose in the long run as well. It’s in the best interest of both parties to work hand in hand towards the common goal of generating ROI. This shared journey fosters a sense of partnership and team effort, which is fundamental for navigating the myriad challenges that may arise along the way.

    We understand the concerns regarding ROI, and hence, we offer a guarantee: if we don’t help you get any sales or leads, we’ll reimburse the amount you spent with us for the labour. This doesn’t cover additional costs like software or advertising expenses. This guarantee underlines our commitment to your success and our confidence in our ability to deliver value.

    And remember: if an agency is offering you a guarantee on ROI, it’s a red flag, so watch out.

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