Agile Planning Acceleration
Digital transformation has been pushed at the forefront of many businesses, as online consumption spiked out of necessity. Because of this, business operations had to embrace agile planning, going from monthly cycles to even weekly cycles, as Wilsdon pointed out during a Circle meeting.
This is probably another trend that is here to stay, which opens the door for agencies transforming their implementation-only status into a more consulting role – helping businesses accelerate their digital systems with know-how and specific search data.
There’s an interesting second-order effect that could happen as SEO agencies take on a more strategic and consultative place. Strong competition between the traditional consultancy firms and the transformed agencies throughout the market could ensue.
Leveraging Search Data
Another trend that accelerated throughout the pandemic, that Google also highlighted for businesses, is the importance of search data in determining thriving markets or significant consumer behaviors.
Probably here to stay, the leverage of search data can go beyond the strategic level and inform how businesses transform their operations.
For instance, as Wilsdon further pointed out, analyzing search data to understand the customer journey and what people are asking about a certain business can inform customer support and their new frequently asked questions materials.
Again, the SEO agency’s supporting role at a general business level can continue to grow.
Yet, a second-order effect can see the rise of a new type of company that only leverages search data for sophisticated research – consulting firms using search data for business analysis, without any direct relationship with SEO.
These are some of the main trends we uncovered.
You can continue this exercise of current trends analysis with what you discovered and what the consequences could be, until you find 3-5 significant trends for your agency context.
Actionable Business Trends & the New Business Model Canvas
With your actionable business trends explored, it is time to create a new business model canvas, guided by the idea of how an SEO agency with significant resources can be shaped in today’s world.
In short, the Business Model Canvas (BMC) designed by Alex Osterwalder is a strategic tool that helps you present an existing business model and make it practical for all the agency’s stakeholders. It is also a tool that enables you to think in the future and create patterns between its building blocks of customers, channels, activities, revenues, and more.
Think About the Business Trends You’ve Discovered
This intermediary step is one that we, at SEOmonitor, introduced to help you be mindful of the external forces influencing your choices.
So which ones are relevant for shaping a better business model for the agency?
For instance, in our debate with TitanGrowth’s managing director, Luke Lauer, he mentioned hedging as an interesting trend of risk management. In investment, hedging means protecting your portfolio by taking an opposite position in a related asset.
If you see a negative impact on your current X stock, you don’t sell but invest in a different Y stock that will reduce your risk of loss.
As an agency, hedging can imply diversifying your client portfolio – because you never know which industries could be affected in the future, you can treat your portfolio as an index of multiple industries to target.
Choose Customer Segments & Connect Them With Your Value Proposition
See how a big trend like remote work can affect both the SEO agency and a possible customer that had to adopt it.
Would they want to work with an agency that has a client service team covering all timezones?
Maybe you can highlight your distributed team and multiple markets know-how as a key proposition, and even target brands that have international coverage.
If you choose hedging as a lens, there are multiple ways to go about it: getting more clients, probably coming from tech and eCommerce, or targeting brands that need to make this transition.
Attacking more verticals than before, to have a diversified portfolio in that respect, and offering them your data know-how. Or, diversifying your services which can become a transition to a more consultative role or an integrated digital marketing positioning – another potential differentiator in today’s global market.
Think About New Channels & Customer Relationships
Once you’ve established the targeted customer segments and the key proposition that differentiates you in solving their particular problem, it’s time to address how you want to build relationships with them and which channels you can use to reach them.
The pandemic made Zoom one of the most sought after channels – weekly video calls are the norm in taking the customer’s pulse and managing their projects.
With agile planning in sight, this means a closer relationship between the agency and the company, while coordinating in sprints and becoming more strategic about SEO.
Maybe even considering having a project manager working directly with the client or an SEO specialist at their disposal for fast decision making on both sides.
The pandemic also took offline events out of the picture for some time, which was an important business development channel for agencies and companies alike. Radu Marcusu pointed out how they moved their Upswing Power Sessions online from the start of the lockdown, managing to gather over 350 qualified participants who didn’t have any contact with their agency before – a better targeting method, as well.
Now is a good opportunity to leverage data-driven outbound marketing for the agency, and even think about experimenting with the sales funnel and automation in qualifying your leads.
Data-driven outbound would take into account far more variables when thinking about potential customers and your lead generation efforts.
Traditionally, agencies would target based on revenue.
However, now you have access to things like the technology that is powering the client’s whole website (e.g., Drupal), year-over-year shifts in their keywords or their monthly market share (YoY Trends). That can be leveraged for highly-targeted messaging, better choosing your marketing channels, and presenting specific offers from the get-go.
Connect Your New Key Activities with Resources & Partners
Once you know how to reach your designated target and what you want your key messages to be, you need to think about the changes in your agency’s key activities, resources, and partners.
Consider hedging again, in terms of new services, thus new key activities for your SEO agency – you could integrate paid search, digital PR, or training and consultancy. Or even expand your agency with an Analytics department for both your clients, and internal research and development.
This implies different resources you need to take into account (new hires, new software, etc.) or extending your partnerships with software providers, freelancers, or other specialized agencies.
Also, remote work comes into play and poses new challenges for your key resources – on the one hand, good specialists are now reachable from any part of the world, but on the other hand, recruitment and onboarding become more difficult.
Juniors, for example, need more direct contact with their seniors and teams to grow in their position. Plus, how do you hire for culture fit?
You can think about longer onboarding periods, hiring an HR consultant, or developing new online tactics for people management (informal Zoom rooms, virtual mentorship programs, etc.). Or you can orient your hiring efforts to experts and project managers that have the experience and autonomy required in the current context.
Analyze Your Costs & Revenue Streams
Getting your other building blocks in order, it is finally time to look at cost structures and revenue streams.
Remote work brings a drop in costs for office space and commute, but can imply new types of packages for your employees. For instance, a budget to set up the team’s home office or to cover a percentage of utility bills (electricity, IT infrastructure, etc.).
If you choose hedging, then new resources and new partnerships developed with your agency expansion become new costs in terms of salaries, software subscriptions, or subcontractors. In turn, diversifying your services with monthly offerings and/or your client profiles or verticals means new revenue that supports your MRR (monthly recurring revenue) growth.
Leveraging your data and analytics skills in itself can become a new revenue stream, if you decide to offer consultancy and training for SMBs and enterprises.
Or maybe you develop a proprietary tool. At first, it’s an investment which alters your cost structure, but can transform into a new business channel at the same time.
Applying BMC to Your Agency – Shifting Business Models
The point of doing this strategic exercise is, in the end, to see how they’re all connected – macro-trends affecting the globe, business trends relevant to the SEO industry, and every segment of an agency business model that can suffer changes and unexpected transformations.
Osterwalder continues to document shifting business models, as the BMC is a tool to be used multiple times in the life of your agency. You can take your leadership team and consider this an exercise in change management – understanding how every part of your agency business can transform and what that means to the business as a whole.
As the market changed dramatically in the last few months, it’s an opportunity to understand how your business model can shift and what’s next for the SEO industry after COVID-19.
At SEOmonitor, we’re committed to helping SEO agencies navigate uncertainty, so we adapt our solutions to the current context.
We’re also continuing these thought experiments with more agency founders and top managers in the Circle, to help agencies focus on what matters now. You can find out more about the selection process and topics in the following material.