Tonic Essentials: Why will the world need you?

1st June 2020

The world for agencies will certainly be different in the future. Some of you are holding your breath waiting for things to get back to normal. Others are expecting a ‘new-normal’ that will require a little bit of adjustment. But for most agencies their world will be altered significantly. Think revolution not evolution and fundamental change rather than refinement.

However successful you’ve been in the past; you won’t have an automatic right to thrive in the future. Some agencies will come out very well, most won’t, many won’t survive. This isn’t a false alarm. There is a critical challenge to understand how the environment will change and adapt to find your new place in the world. It won’t be easy to deliver true value for clients, employees and agency owners and this will feel like a real threat for a lot of agencies. But it will be a great opportunity for others. So, whatever battles you’re dealing with today, it’s never too early to be working on how you can become an agency fit for the future.

History has shown that crises can significantly reshape beliefs and behaviours. New social policies, ways of working, marketplace dynamics and customer needs have all been fuelled by major disruptions. The Second World War, 9/11 and the SARS virus have all played their part in influencing the world as we’ve known it. And Covid-19 will similarly drive change. And all that’s apart from the financial pressures brought about by the deep recession we’re entering now.

But for agencies the pressures are more fundamental than just this crisis. The agency world has been at a tipping point for many years. Originality and creativity have been fading, client connections weakening, employee commitment waning and profitability shrinking. Many agencies have become too elaborate, rigid and predictable. The door has been left open for newer types of competitors and they’ve fared very well.

If you’re an agency that has managed to stay fresh and ahead of these challenges, your preparations for the future are likely to be easier than others – but no less important. If you recognise any of these symptoms, you’ll need to be thinking and changing more radically. But if you do this properly it could be just what your agency has needed for some time – and set you up for years to come.

The stagnation in agency sharpness and effectiveness has been felt by many clients for some time. We’ve all seen the increase in pitching, switching, multiple agencies and in-housing as clients have searched for people who can really deliver clever, joined-up solutions across the media landscape. And during this locked down period, they’ll have been exposed to even more agency offerings. They’ll have recognised new requirements, seen new ideas and found quicker, cheaper ways of getting good things done.

Agencies will be under greater pressure to convince clients that their level and type of expertise can genuinely add significant value. This will put more focus on smart thinking and creativity than on just ‘doing’. You’ll need to stack up well against new criteria in terms of offer and impact, taking out the gloss and eliminating unnecessary activities and timings. Relationships and financial rewards can still be mutually beneficial, but your clients will need to be chosen very carefully – and these might not be the ones you’ve had in the past or worked closely with during this crisis.

Attitudes and expectations towards work were already changing quickly before the pandemic arrived. The demand for greater meaning and flexibility was already challenging traditional approaches and putting pressure on leaders to be more balanced, transparent and fair. Recent experiences have deepened these desires, added a demand for a greater sense of belonging and prompted more people to feel the same way.

With clients insisting on only working with the very best, attracting and retaining talent will be more difficult than ever before. As leaders you’ll be challenged to define your purpose and to commit to these beliefs in your work every day. And to maintain motivation, productivity and profitability you’ll need to think radically about new approaches to roles, structures, recognition, remuneration, progression and empowerment. These are just some of the many new demands that will fall on leadership teams who must now become more skilful and more consistent than they’ve demonstrated in the past.

With profit margins and dividend streams already under pressure, Covid-19 will only have made things worse for shareholders. And with the list of potential purchasers already much reduced, the current interruption to growth plans will make the chance of a good exit feel even further away. But dreams of easy growth and big sale values have never been realistic. The optimum strategy has always been to build the best business you can and keep your value options open.

Good agencies manage risk well and that will be even more important in the future. Agencies with low profit margins trying to grow their way to better results will have learned the hard way in recent months. So, it will be vital to keep things tight and not add back costs ahead of securing the revenues to support them. Be prepared to fundamentally change your business model – what you provide, to whom, how and for how much. And don’t be daunted by having 2020 as the base year for your new high growth track record, with the right changes the next few years could be significantly better than you would ever have achieved with your ‘old’ business.


To emerge from this period as an agency with a clear, distinctive place for the future will be no ordinary task. Bold, fresh thinking and a rigorous process are vital. It’s not about guess work, nor about waiting to see how things shape up. You’ll need to understand the marketplace in which you’ll be competing, decide how you can play to win, assess your current business and act to transform your game.

We’ve set up a framework to guide this process and we’ve been working it through with a number of proactive clients. It’s been an exciting time for them to gain confidence, set a new direction, see new opportunities and remove the barriers holding them back.

If you aren’t clear why the world will need your agency – you’d better get moving. If you’re already on your way to a good place, keep going. It’s not for the feint hearted, but if you don’t embrace the challenge you might just fade away.

Make sure you’re ready and if we can help just let us know.


About Tonic Creative Business Partners

The business consultancy to add clarity, confidence and colour to your ambition.

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