In today’s digital age, generating revenue from an online business is challenging. There is an increasing reliance on marketing companies, as a company’s brand reputation management is not possible by an in-house business team alone. Many online consulting companies are mushrooming overnight to help businesses. However, this creates a problem for businesses to select a partner to boost their revenue. Companies have a hard time selecting a reliable marketing company because there is a growing complexity in determining which organization will deliver the actual ROI in terms of revenue earning, instead of other metrics, such as more traffic. more clicks, or the top ranking on SERP. Research is exhausting and time-consuming, but selecting a marketing company without it is a recipe for disaster in terms of wastage of budget and other long-term consequences.
Why Businesses Skip Proper Agency Research
Tight deadlines or urgent campaign needs, over-reliance on referrals or brand reputation, and attractive pricing or “too good to be true” offers are some of the common reasons for which a company often skips proper agency research. Another reason is a misconception that all companies offer similar quality and results.
In today’s fast-paced business environment, marketers feel they are in a 100M sprint. Situations like launching a new product, adapting to an emerging trend, or responding to competitor activity, gathering consumer insights is vital to plan a marketing strategy. Tight deadlines impede the quality of data collection and trimming. Planning an effective marketing strategy is not possible with poor-quality data.
Word of mouth or references also discourages a company from conducting formal research. This process requires no effort or time but may bring unexpected outcomes. If the hired agency’s campaign strategy is not aligned with the client’s business goal, high revenue generation is unexpected.
Price is a dominant factor in skipping the research process. Some of the typical language of cheap marketers is” guaranteed ranking, instant results, and extraordinary ROI”. With a tight budget, deep marketing research becomes unrealistic. Instead, embracing a cheap marketing package is a wise decision.
Marketing agencies’ vanity or positive-looking metrics are not conducive to research. It creates a misconception that all companies offer similar quality or results. However, metrics such as ranking or clicks do not reflect actual ROI.
Hidden Risk #1: Misaligned Strategy and Business Goals
When a client’s business objective and a marketing agency’s strategies are misaligned, three predictable outcomes are anticipated.
First, the marketing agency may not understand the client’s business objective. A failure to understand objectives will lead to a wrong marketing plan and execution, resulting in poor ROI.
Second, the spectre of a generic marketing strategy. The agency will implement a generic strategy if it fails to identify a target audience, which may stem from misaligned objectives or goals. The peril of a generic strategy is that it often fails to resonate with the target audience, resulting in low revenue generation.
Third, low or no ROI, brand positioning, and long-term growth. Misalignment or conflicting objectives often result in a failed campaign, a waste of budget, and the worst of all, no ROI. Zero ROI is a clear message that the two parties’ business goals are different.
Hidden Risk #2: Lack of Industry Expertise
With numerous industries out there, experience in niche marketing is a vital criterion for choosing an agency. With this experience, a company identifies a business’s target audience and offers products that consumers want to buy. Sales and revenue shot up when targeted customers bought their favorite products like hotcakes.
The lack of industry expertise often results in wrong or misaligned messaging. This happens due to the wrong interpretation of marketers about a business’s market. Wrong messages fail to resonate with the audience. They have both short and long-term consequences. Fail campaign, confusion among customers, and damage to brand reputation are some of the short-term and long-term consequences of wrong messaging.
For some industries, messaging could be a deal-maker or breaker. Industries, such as SaaS, healthcare, and e-commerce, demand specialized messaging to make it meaningful to customers and influence their buying decisions. For example, SaaS products are complex and subscription-based. Marketing in this niche requires educating buyers first. Then address a pain point, and provide a solution. In simple language, marketers need to highlight how a SaaS product or solution could be a relief for buyers.
Healthcare is a highly specialized industry. Buyers in this industry are highly educated and knowledgeable. Messaging here needs to be precise, compliant, and trustworthy. With an industry of diverse healthcare buyers, trust and credible messaging are the keys to conversion. Lastly, e-commerce messaging must be customer-centric and highly personalized. The key to success in e-commerce is assuring customers a seamless experience through language.
Hidden Risk #3: Poor Transparency and Communication
Choosing a marketing agency without research, poor transparency, and communication will soon result. Here are a few unmistakable signs of low transparency
- Vague Reporting
A monthly report filled with confusing metrics. For example, impressions and reach are two common metrics of every report. However, they are meaningless if an agency cannot explain how they are connected to the business’s goal. Impression is a vague metric because it does not reflect the actual sales or revenue, while the metric conversion does.
- Lack of Clear KPIS
KPIs are numerical values that express an agency’s different business strategies’ outcomes. For example, conversion rate is an important KPI. It clearly indicates the success of marketing efforts in terms of revenue growth, which is what every business wants. Lack of transparency is evident if a business report does not have clear KPIs.
Poor communication is another concerning issue associated with selecting an agency without research. Marketing is a coordinated effort where clear communication between an agency and its client is the key. Lacks in communication between them will result in no coordination, working in different directions, and accepting several unpleasant outcomes, including wasted resources, missed deadlines, damaged trust, and failed partnership.
Hidden Risk #4: Inefficient Budget Allocation
Choosing a company without research increases the risk of draining the budget in a couple of ways. Inexperienced or misaligned agencies could waste budget
- Incorrect channel selection
Inexperienced or misaligned marketing agencies are susceptible to selecting the wrong audience. Since selecting the right audience is the driver of a business’s success, any mistake in it, either inadvertently or due to inexperience, would result in wrong messaging and a failed campaign. Waste of the budget is inevitable if either of them does not work.
- Poor ad spend optimization
Markeing agencies often waste ad budget due to infrequent campaign optimization. These companies often fell into a set-it-and-forget-it trap. Optimization requires continuous testing that many companies skip. The absence of conversion tracking in a campaign setup makes regular optimization impossible. Conversion tracking helps you identify what you need to optimize, such as keywords, landing pages, or audience targeting mistakes.
In today’s fast-paced digital world, understanding the long-term cost of an inefficient campaign vs upfront savings is vital for a marketing agency. Skipping marketing research saves marketing agencies time and money upfront. Identifying the target audience, analyzing competitors, understanding demographics, and setting clear KPIs are essential part of a successful marketing campaign. When an agency skips any of these processes, an inefficient campaign is ensured, which has a couple of long-term consequences, such as low revenue growth and a bad reputation.
Hidden Risk #5: Overpromising and Underdelivering
Deceptive language is another hidden risk in the marketing world. Lofty promises such as “guaranteed instant results” or unrealistic ROI projections could be a sales technique rather than delivering real benefits such as revenue growth. A business may waste its marketing budget by signing a contract on these sugary promises. For example, promising instant results is a real red flag. In business, there are several uncontrollable factors, such as competitors or algorithmic change. Overnight ranking is not possible amidst these uncontrollable factors.
The promise of a quick revenue growth is another unrealistic claim to attract clients. There are many businesses out there. Some are well-established, while some are emerging. In such stiff competition, marketing efforts gradually increase the sales volume of a new business, not overnight.
Credible agencies, on the other hand, focus on sustainable growth instead of quick wins. They don’t rely on quick wins because a sudden spike in sales often doesn’t last long. For example, a promotional offer may result in a sales surge. However, after the end of the promotion, if customers don’t stick around, the promotion-induced sales frenzy may not last, resulting in a nose-dive of sales volume.
Quick wins are also traps. A business feels complacent after getting a sudden success; however, it makes its vision blur, eyeing more important business goals, such as targeting customers or building brand trust.
In contrast to unreliable agencies, trusted agencies’ main focus is sustainable growth. This type of growth refers to a business that will run smoothly after the initial excitement of launching. Sustainability also refers to scalability, which means businesses have the ability to manage more customers if needed.
Hidden Risk #6: High Team Turnover and Inconsistent Execution
Frequent marketing team changes disrupt the campaign continuity and strategy. When marketers depart, they take knowledge and expertise with them. Although a new marketing team fills the void, it reduces the cohesiveness of the marketing strategy and tactics. The new team also pursues a new strategy, which may not bring the expected results.
A stable, experienced team, on the other hand, works more closely to achieve a business’s goal. Members of such a team know each other’s strengths, share experience more effectively, are less stretched, and are more focused. Collaboration and shared goals are two other important attributes of a stable team.
Hidden Risk #7: Damage to Brand Reputation
A wrong marketing agency may damage a brand’s reputation by posting poor-quality content, misaligned messaging, and unethical practices. Poor-quality content means low engagement, poor conversions, and lower ROI. Misaligned messaging happens when an agency fails to identify a business’s target audience. Irrelevant messaging often results in low conversions and negative customer feedback. A mistakenly chosen agency may be involved in unethical business practices, which is no less damaging than poor quality content or misaligned messaging. Several consequences of unethical practices are bad reputations, fines, jail terms, and societal harm.
Real-World Scenarios: When Poor Agency Choices Go Wrong
There are some common scenarios of poor agency selection, and undesirable consequences such as wasted Ad budget and poor ROI. One common scenario is a poor PPC campaign and inevitable ad budget loss. Wrong keyword targeting is a primary cause of a poor ppc camaign. Broad, or irrelevant keywords, attract the wrong audience clicks that do not convert, resulting in draining of valuable Ad budget. A weak campaign strategy is another common scenario. A hastily chosen, inexperienced agency cannot be expected to make a successful marketing campaign. For example, from the start, it may fail to identify the target audience of a business. Wrong audience means wrong messaging and low conversions.
Real-world examples are quite common in the practice of black hat seo, and corresponding consequences. To gain immediate appreciation, a clever but unscrupulous agency may adopt a black hat SEO strategy. This strategy brings short-term gains but incurs long-term losses. A few harsh penalties include massive ranking drops, traffic loss( up to below 60%), and deindexing(the site will disappear from Google). Famous examples include J.C. Penney, which used thousands of unnatural backlinks to manipulate rankings. However, the unfair means resulting in a nosedive of its ranking from page 1 to page 5, BMW of Germany received a cloaking penalty, which means showing different content to Google vs users. The company’s website was temporarily removed from Google as a cloaking penalty.
Research can save a business from wasting its ad budget on an inexperienced agency. Doing some research before selecting an agency could avoid either running an unsuccessful PPC campaign or receiving a penalty due to black hat SEO. An agency’s simple background check is enough to know how many successful PPC campaigns it previously ran. Contact its previous clients and get their testimonials. An agency’s previous clients will also disclose(if any) black hat-related issues.
How to Properly Research a Marketing Agency
A marketing agency’s verified reviews and ratings are the main criteria of its selection process. However, the authenticity of reviews is questionable, as there is little room to verify them, and there are allegations that testimonials are either cherry-picked or strategically curated. Evaluation of a marketing agency’s reviews and ratings involves several steps, which include
- Cross-check review authenticity across different platforms, such as Google, Clutch, and G2
Cross-platform verification reveals consistency in reviews, which is not possible with a single platform. A substantial review volume on B2B marketing agencies is available on platforms such as Clutch, G2, and Google Business Profile. There are also industry-specific directories that provide additional information on marketing agencies.
- Identify fake or biased reviews
Fake or biased reviews often use the same or repetitive language, frequent mention of products or staff names, and outbursts of similar reviews. Comparison of reviews across different platforms and verified purchase badges confirms the authenticity of reviews. Moreover, overly polished wording with occasional negative experiences sounds something fishy.
- Examine client testimonials for specificity and depth
Some of the vague testimonial sentences are “great agency,” “highly recommended, “and ” they really understood our needs.” These wordings are encouraging, yet do not express the actual achievement. A credible testimonial would share a detailed experience of a business with an agency. For example, it would briefly narrate what challenges it encountered and the agency’s role in providing solutions.
- Response to negative feedback
It is not surprising that an agency received some negative feedback. How an agency responds to negative feedback reveals its professionalism. If an agency acknowledges the problem, asks politely for clarity, and offers a solution, it knows the business rule, and ok to make a contract.
A marketing agency develops strategies to increase the online visibility of a business, helps find its target audience, and runs a campaign to promote sales. In the fast-paced world of digital business, many start-ups ignore the research process while choosing an agency. It saves money and time at the initial stage of a business. However, there are over half a dozen hidden consequences associated with selecting an agency without research. Waste of ad budget, bad reputation, and missed growth opportunities are some of the negative consequences of choosing the wrong agency.
