Seth Godin – Renowned author, entrepreneur, and marketing teacher behind classics like Permission Marketing, This Is Marketing, and Purple Cow. He’s founded companies like Squidoo and Yoyodyne (acquired by Yahoo!), and has inspired marketers worldwide with his fresh perspective on agency growth and branding.
What You’ll Learn
- The evolving role of agencies—from ad buyers to strategic advisors
- Why racing to the bottom on price is a losing strategy
- How to build a true brand vs. just a logo, using comparison illustrations like Nike vs. Hyatt
- The two critical questions your agency must answer to prove real value
- Why clients actually hire agencies—to improve or preserve status—and how to create tension that inspires change
Key Takeaways
- Being a strategic advisor to the CEO beats running ads—you upgrade your seat at the table
- Stop competing on price—you’re just mounting a race to the bottom
- Brands are about expectations, not just visuals—be clear about what you stand for
- Define your pricing value: weigh cost versus worth to your ideal client
- Clients want status. Use tension in your messaging to drive change
What’s the Future of Marketing Agencies?
There’s an old school definition of an agency where they bought the ads for brands and created the ads they’d place. These agencies earned a percentage of the ad spend and charge a fee for the creative elements. But, Seth says, twenty years ago that agency model started to shift.
At the early stages of the internet boom, brands no longer needed agencies to buy ads or create them. Beginning then and even truer today, Seth believes agencies need to be advisors to brands. Clients need you to help make their products or services better.
Agencies have the ear of the CEO. Therefore, the future of agencies lies in building that relationship and being the liaison between the CEO, the other departments of the business - like engineers and other creators, and the consumers themselves.
Using Pricing As A Differentiating Factor
A lot of agencies tell me they watch their competition and then charge slightly less, and that’s their strategy for staying ahead of the competition. My advice is always: don’t make lower prices be your differentiating quality.
Seth agrees and shared a story about his 1995 business venture “Get Rich Click.” While Yahoo! was selling clicks for $2.00, Seth was selling them for 50-cents. He says he knew he was only going to be successful until someone else started selling them for 49-cents. You know what happened? Yahoo! bought them and eliminated the competition.
Friends, you cannot grow your agency if you’re racing to the bottom!
What’s the Difference Between a Logo and a Brand?
Are you building a brand, or is your agency just a logo? Seth talked about the difference between a brand and a logo using his example of Nike and Hyatt. He asked if Nike started a hotel chain, could you envision it? Yes, of course. But if the inverse were true, and Hyatt created an athletic shoe, could you envision it? Not so much.
The difference is, Nike has built a brand. Consumers know what they stand for and believe in. So anything and everything Nike does, their customers know what to expect. Hyatt has built a chain of hotels, but their name and logo may as well be interchangeable with others in the industry. They don’t represent or stand for anything specific.
So - while growing your agency, be clear on what you stand for and convey that message to your audience. This is what will build your brand and help your agency stand out.
2 Steps for Agencies to Determine Value
Seth says we have to get away from the “more and better” mentality. Meaning, stop thinking about getting more clients as your way of being better than the competition. If all you want are more clients, then your worth is tied to how busy you are but if you really want to be better then there are two questions to answer when determining worth:
How much do you cost compared to the alternative?
How much is what you do worth to your target market?
Seth says you have to be the one and only… if you’re no better than the alternative, then you’re not worth more than them. It's that simple.
Why Agencies Need to Select a Niche
Selecting a niche does not mean serving a small audience, it means serving a specific audience. Seth believes it’s super important and here’s why... The web is not mass media. We think it is and we treat it like it is, but it’s not and users aren’t using that way. We act like there are infinite possibilities when marketing on the internet, but that’s just not true because people are online searching for very specific information. If your message is too broad you can’t and won’t be found.
As I like to tell agencies, marketing toward one niche does not mean turning down work from clients outside your niche. It just means you’re laser-focused in one specific niche and aiming all your marketing toward them which will aid in growing your marketing agency.
Let’s be clear -- you will not miss out on any business if you become a leader in your niche.
Truth is, you’re already missing out. Seth says “you have to figure out how to be missed when you’re gone by the smallest group that can support you.” That’s when you’ll have clients knocking on your door and they’ll bring their friends.
What Clients Really Want from Agencies
A large part of the reason people make purchase decisions has to do with status. Seth believes decisions are based on preserving or improving status. So, what your clients want from their agency provides some version of status.
“Change doesn’t happen without tension” ~ Seth Godin
Therefore, your content marketing needs to create tension in order to inspire change. Seth believes we need to create content that grabs attention, builds trust, and turns on permission marketing. The trap many fall into is making it all free, all the time. The key is giving just enough free content to make them realize you know your stuff!
Related: How to Quit Losing Clients by Knowing What They Really Want
Leverage Your Strengths to Win Clients
Agencies can use the network effect to create change. Essentially, the network effect occurs when an increased number of people improve the value of a product or service. Seth believes marketing agencies are in the perfect position to create a network effect through their relationships with brand CEOs.
He says the system that built our economy and our culture is changing forever. You must invest the time to understand the system and learn what’s necessary to create a product or service that spreads. That’s how your agency will be successful and significant.
Seth references a sign he saw when he was speaking at a Walmart event many years ago. The banner read: You Can’t Out-Amazon Amazon Walmart knows its strength is low prices. They know Amazon’s strengths too. And they know they can’t compete with Amazon. So instead of trying to “out-Amazon” the competition, they’re continuing to do what they know they do well.
Know your strengths. Know your weaknesses. Recognize what they are, what they aren’t, and what they can’t be. Stop working on your weaknesses - just go be the best in the world at what you do well.
What to Remember When Growing Your Marketing Agency
Seth provided lots of important and beneficial advice for agency owners that may be facing issues when it comes to client retention and growing your marketing agency. the first important thing is to ensure that you're building a brand and not just a logo. When growing your marketing agency, identify if you fall into a niche and find your target client pool. Once you have your niche, you can highlight what your exiting clients and potential clients expect from your agency.
This will support you in growing your marketing agency. One of the most important tips Seth gave in this episode was leveraging your strengths when looking into growing your marketing agency by winning clients. Using your strengths will give you an insight into how the system works to create a network of connections, support you in recognizing services you are weak in and allow you to establish your agency strength to promote to clients.
