Being proactive in the face of economic downturns and natural crises is critical for any business.
One thing we learned from the 2008 recession is that marketing budgets are first to get cut – shrinking up to 30%.
That is why now is an important moment for SEO agencies to focus on the productivity and well-being of their teams, and above all, good client management.
Communication and care are crucial for navigating market uncertainties while transforming processes that keep SEOs profitable.
On March 25, I moderated a sponsored Search Engine Journal webinar presented by Alen-Jelco Todorov of SEOmonitor.
Todorov shared how SEO agencies can be proactive and prevent high churn in the face of an economic downturn.
Here’s a recap of the webinar presentation.
Times are hard, but your agencies can stay profitable during the economic downturn that you’re facing.
Let’s think about what contingency means and how can you help yourself, your agency, and your executive team plan for this scenario.
Before diving into the tactics to help keep your agency afloat during these times, here are a few considerations:
- Every agency situation is unique. Some cater to local businesses, while others work with enterprise customers.
- Your primary goal is to maintain sustainability.
Our goal right now is to have a tool for strategic thinking and reference point for management workshops.
The best time to think about what could happen in the future is now.
Assess the Current Situation
Any contingency plan starts with thinking and assessing the current situation.
This starts with knowing the fundamentals of your company.
Consider starting your assessment by looking at:
- External factors
- Opportunity areas
- Risk areas
- Internal factors
Even with the current situation, we can still find opportunity areas to help us stay ahead.
Opportunity Areas: Where Can You Add More Value?
Currently, more states and countries are imposing a lockdown and people are forced to work from home.
For some agencies, this results in a lower cost per full-time employee (FTE) due to switching to a remote team.
And for those that already have digital transformation expertise, it is an opportunity to help your customers navigate the challenges of switching to digital.
What Areas Are at Risk?
Next you need to know which areas of your business are at risk so you can come up with a plan. One example is to mitigate the loss of clients.
To do this, list all your customers together with their industry and monthly recurring revenue (MRR), along with specified action items you might take to mitigate each risk.
Make sure that each risk is tied up with a specific action item as this will be useful later on.
People: How to Keep Them Active & Engaged
Next, you want to look at how you can keep your own team active and engaged in these stressful times.
We’re seeing a lot of disruptions caused by the COVID-19 pandemic and it will definitely affect your team members’ personal and professional lives.
It is difficult to stay motivated especially during a time like this.
That’s why the executive team has a responsibility to lead by example and with empathy.
- Should you increase the amount of staff meetings?
- How do you maintain your work ethic culture while social distancing?
It is imperative for agencies to improve team communication.
One good tip is simply switching on your video camera instead of just doing voice calls during team meetings.
Cash: Monthly Operating Expenses
Most SEO agencies subscribe to various tools, software, and service providers for operational purposes.
Now is the time to assess each vendor, including the cost, to make sure whether it’s still worth having.
Perhaps there is a better alternative out there or the vendor might allow you to renegotiate?
Asses Your Current Situation as a Team
Typically, companies have a top-down approach when it comes to decision-making and implementation.
However, it might be better to gather around your team and hear each of your staff member’s points and concerns.
This will help you get a better range of ideas from more people.
And once you do this, it isn’t simply the CEO’s plan, it becomes a team plan – something that the whole team wants to do.
If the management team just comes up with ideas themselves, it could be harder for team members to put them into action.
Build the Contingency Plan
After assessing your current situation, you are now well-equipped to build your agency’s contingency plan.
SEO and digital agencies typically have three main functions to help keep their business afloat:
- Acquiring customers.
- Managing customers.
- Retaining customers.
For each function, you want to identify pre-emptive (opportunistic), “what-if” (cutting into the muscle), and defensive (cutting into the bone) items.
It’s important for the management team to establish and align on trigger events.
This means everyone should be on the same page in terms of how to approach each situation that arises.
Establishing and aligning on trigger events means your actions:
- Have an objective that is quantifiable.
- Are agreed upon by the whole leadership team.
- Are based on real-time data.
- Are aligned to cash.
Here’s an example of how you can do this.
- Pre-emptive: Offer introductory pricing
- What-if: Offer discounts for long-term contracts.
- Defensive: Re-package for margin.
- Pre-emptive: Identify what expenses can be put on hold with no harm.
- What-if: Consider short-term capex, bonuses / sales incentives.
- Defensive: Deferred compensation, part-time work.
- Pre-emptive: Focus on high-value and at-risk customers and conduct weekly check-ins.
- What-if: Offer exclusive access.
- Defensive: Pause existing campaigns.
Focus on the Relationships
Here are a few tips on how to mitigate the concerns your customers could have from a remote team.
Inform your customers about your current workflow.
Make sure to conduct weekly check-ins about the company’s current status.
Be a Consultant
Don’t give self-serving advice.
There is no point in hard-selling right now!
Some companies need to stop all marketing initiatives in order to make payroll.
Be a valuable partner that can provide honest insights valuable to their business.
These are definitely uncertain times… and it might be the new normal for all of us.
Over to You
Right now, it is critical for SEO agencies to manage their relationships with existing customers.
It is also important to focus on your own people and provide support during this transition from past routine toward this “new normal.”
[Video Recap] How SEO Agencies Can Stay Profitable During a Downturn
Watch the video recap of the webinar presentation and Q&A session.
Or check out the SlideShare below.
All screenshots taken by author, March 2020