Chris Norton: 0:04

Welcome to Embracing Marketing Mistakes, the show where we dive into the lessons, opportunities and hard-earned wisdom from the world of marketing and public relations. In today's show, we have a slightly different episode for you. This week. We're going to tackle a challenge that hits home for every agency owner out there how can agencies charge what they're really worth? If you've ever felt like your agency is delivering incredible work but clients just don't recognise the true value or, even worse, they underpay you for it, then this episode is for you.

Chris Norton: 0:35

Today, we're joined by Crispin Manners, ceo of Onvert and former chairman of the PRCA, an expert who spent years helping agencies like yours and mine rethink their pricing strategy and unlocking greater profitability. Crispin has seen firsthand how agencies often get stuck in a cycle of undervaluing their services and missing out on the bigger opportunities. Basically, he's here to help us flip the script on pricing, and I think it makes for a fascinating discussion. Many agencies operate on outdated pricing models, charging by the hour or sticking to industry norms that leave money on the table, but the most successful agencies have learned to shift to value-based pricing where fees are tied directly to the impact that you have on your client's business. And guess what? It's not only possible, but it's the key to sustained growth. So how do you start that journey? We'll explore how to prove your value, what questions to ask your clients and determine their true business goals, and how to move beyond the usual brand awareness type pitches to deliver real business impact. Crispin also shares some real world examples where agencies have successfully transitioned to value-based pricing, and how you can too. So, as always, sit back, relax and let's hear how you can unlock the real value of your agency's work and charge what you're actually worth.

Chris Norton: 1:59

Crispin Manners, welcome to the show. Hi, nice to be here. Well, crispin, we've got you on the show because we met about a year ago now and you've got an illustrious career, as Will's just been pointing out, one of which, which surprised me, you were a founding fellow of the PRCA, which is quite impressive. So what does that mean?

Crispin Manners: 2:24

Well, it's, what does it mean? It's, it's kind of a, it's a bit like a blue Peter badge, really, that they hand out to people who've done quite a lot for them. And I guess I guess I was one of the founding fellows, because I was on the board for quite a number of years and was chairman for two, and I also chaired what they then called their Professional Practices Committee, which was where any complaints, if they existed, were brought to to be dealt with.

Chris Norton: 2:58

Okay and so well. I mean that's amazing that you're the chairman of the PRCA and you're also the CEO of Kaizo, right? So my knowledge of Kaizo goes right back to when I first ever started my career and I had an interview. I started out well. My second job was in PR in London for Harvard PR, but I interviewed a couple of places and I got headhunted actually for a role at Kaizo, so you could have been my boss, but it never. It never came off in the end. So maybe you chose wisely. So why don't you tell us a bit about kaizo and what you did and what they stood for? And yeah, just so that people can understand what what they're about um.

Crispin Manners: 3:36

Well, I guess, like many people, I got into um. I got into pr a bit by accident. My first job was working for a food company and I applied for. I applied to become a brand manager and I went through a really convoluted interview process that took, I guess, about 100 applicants down to the final two. It sounds like a pitch. This isn't it. We got to the last two and a week went by after my final interview and I heard nothing. So I phoned them up and said what's happening and they said oh, didn't we tell you? You didn't get it and because I was quite hot-headed back then, I got the hump and resigned.

Chris Norton: 4:27

Okay.

Crispin Manners: 4:29

And it wasn't the smartest decision really, because I'd probably only been married a year, I'd just got a mortgage, didn't have a job to go to, but fortunately they hadn't got anyone to replace me. So I said I would hang around long enough for them to recruit someone, and in that time we'll get the nepotism out on the table. My father, who had set up his own PR firm two years earlier, took pity on me and decided he needed what he called a bag carrier to come and support him. So, without anything else to go to, I agreed to go and join my father and his firm, thinking that it would be a real short-term thing, and I guess I ended up leaving about 35 years later.

Chris Norton: 5:29

Wow. I mean 35 years To run an agent. I mean we've run in this place for 14 years and that feels long enough. Both of us have got a lot greyer, so how did you manage 35 years? That's impressive.

Crispin Manners: 5:41

Yeah, well, I mean when I joined there were three of us, and a few years later, because he was heading up towards retirement, I became MD and up until that point we had been focusing on corporate and investor relations, which he was a genuine superstar at, but he operated at sort of chairman and chief exec level if FTSE top 50 companies, and I didn't quite see that they would see me in quite the same light. So I decided that we should change direction, because then we were based out in Bracknell in Berkshire and there were a whole load of software companies there. I decided we would target, target the tech industry, and I guess we got lucky because we won our first software client in 1980. No 1989, I should say just as the whole tech boom was kicking off. So we got into a growing market at just the right time, booming back. Yeah, we grew really fast on the back of that, partly because it was a fast, fast growing sector and partly because I guess we were probably quite good at winning stuff at the time.

Will Ockenden: 7:12

Very modest.

Crispin Manners: 7:13

And then and then we when, when the dot-com bust hit round about the year 2000,. We, so, when the dot-com bust hit round about the year 2000, we started to diversify and acquired three or four smaller agencies to get us into consumer and a whole bunch of other things.

Will Ockenden: 7:36

And how did you exit that agency then? Did you sell it? What happened there?

Crispin Manners: 7:55

And did you sell it? Did you know what, what happened there and did you get value? I sold, I sold it, I sold my, my shares in it to, um, uh, the people I had hired to replace me. So that took a process of from hiring them to them buying me out was probably um, about about five years, I guess. Uh, and the whole exit thing is really interesting and I'm I'm actually helping about four or five agencies right now, um plan plan for owner exit, um, which is a which is a whole topic in its own right, I guess you've piqued my my interest so then on to um, on for then.

Will Ockenden: 8:26

So why don't we? You know, from um kaizo to to onva, so obviously you know the industry, or some aspects of it, still excited you and motivated you. Why don't you explain a little bit about what you do, what you do now and um? A lot of what you do is working directly with business leaders, isn't it?

Crispin Manners: 8:45

yeah, I mean I think when I, when I set up on where it was, it was designed to be a um, a sort of sole trader vehicle to allow me to do work I liked, because one of the things that I found in the towards the latter end, particularly of the 35 years of building an agency was that I ended up doing things I didn't really enjoy and didn't really energize me, and I think that's a trap that a lot of a lot of owners fall into um. So Onva was designed to to to get back to doing stuff. That was fun. And now I focus or entirely on helping agency owners to try and get what they want from their agency and and and that is fun, because seeing people start to really get what they, what they hoped they would get from their company and have a bit more, a bit more enjoyment doing it's actually quite rewarding and what do I mean?

Will Ockenden: 9:54

this is a this is a big question. You probably can't answer this. What do agency owners want from their agencies? Um, aside from I think he's asking himself that one aside from um adequate remuneration, you know, is there kind of trends, you see, and I assume fun and um work that's stimulating and enjoyable comes, comes pretty high, doesn't it?

Crispin Manners: 10:49

yeah, it's a. It's a really interesting one because it it it's different for every owner, but what's what's? What's common to almost every owner is that they don't think about that early enough. They fall into running an agency for whatever reason, don't like their last company to set up their own company or whatever, and they just start serving clients without necessarily thinking about why they're doing it. So what they see as rewarding does vary by individual.

Crispin Manners: 11:25

Some do it to try and earn as much as they can. Others do it to try and make a significant difference. I've helped a really amazing agency in Dublin and I helped them work on their purpose, and their purpose paraphrase now is to make Ireland a fairer society. So they do some sort of real transformational work in Ireland, including things like contributing to changing the abortion laws, contributing to getting equal pay for women, that kind of stuff. So for the owner of that agency it's more about being able to do that kind of transformational work, whereas for others it's it's more about it can be more about um creating the lifestyle choices for their family interesting.

Chris Norton: 12:30

So, and and that that's led you to write your book, which I've, which I've read, um, which which was really interesting and it was all about, it's all about value. So I I had to read. You said you're going to have to read this book if you're working with me and I was like, oh God, not another book I've read I have to read so many marketing books but yours, you say, and you, what was the description you gave me? It was like it's um, it's not like a normal loads of examples, and it was really practical, um, and actually I found it quite, I don't want to say an easy read, but cause I like practical things, practical solutions, and I like examples, um, because then you remember it better. So do you want to explain how the book came about and what it's all about?

Crispin Manners: 13:15

Yeah, I mean thank you for. Thank you for your nice comments. I was motivated to write the book because the more I was helping agency owners I mean I also run some training sessions for the PRCA on running agencies and obviously encounter quite a lot of senior agency people on those and the more I met, the more frustrated I got that the brilliant work they were doing wasn't adequately rewarded or, put another way, they weren't charging the right price for the work that they did. So it's very easy to make statements like that, so. So I thought well, if, if, if, there's a better way of ensuring that you can get paid what you're worth, I might as well try and capture it in a, in a, in a book that could act as a guide and that people could follow, because charging according to the value you deliver isn't, isn't straightforward, it it's a bit like peeling an onion. There are lots of different layers that you have to make sure you get right. That's why it ended up being whatever it was 10 or 11 chapters, because you know it addresses all of those sort of key, key components to make sure, to make sure you actually have a chance of of earning, earning what, what you should, and I think it's it's.

Crispin Manners: 14:43

It's an interesting one for me because I was talking to an agency the other day and I was actually talking to, if you like, the, the next generation leadership, um, the the founder is. The founder wants to get out and has suddenly realized that her firm isn't making enough profit to be attractive to an acquirer. So she's called in a consultant who's looked at it from a financial perspective and is telling her to do things like maximize the number of hours people are billing and all of that sort of stuff, of that sort of stuff, on the assumption that she will price according to industry norms. And industry norms deliver profit before taxes anywhere between about six percent and about 16 percent. Um, but there are agencies out there that generate 40 percent before tax, out there that generate 40% before tax. So my view was don't follow the usual industry approach that says you know, try and get to 20 if you're lucky, but accept it being 15. Why not start and try to get to 40 and find a way of doing that?

Will Ockenden: 15:58

So that was the motivator for the book so you can probably tell where the next um line of questioning is going to go, because this, this is starting to get really interesting and actually I might, I might add, I assume this is an issue any kind of service-based business might face. So consultants of any kind I don't know about accountants or lawyers, but anyone that sells their time. I suppose, um, I suppose this is an issue for a lesser or greater degree, but how do we kind of I think people's ears will prick up and think, great, we need to charge more, we need to sell value. I suppose the first question is how do we understand what our solution or our time is actually worth? So, rather than just the 20% markup on the hourly rate or whatever it might be, how do we kind of shift to this new model?

Crispin Manners: 16:50

The first thing you need to be able to even begin the shift is confidence, and one of the things I think that still surprises me about the sector which is full of amazingly talented people who deliver great stuff for clients is that by and large, the confidence level is ridiculously low.

Crispin Manners: 17:12

And one of the reasons for that is, I think, that agencies measure output rather than the impact, measure output rather than the impact, and because they do that, they're not used to having conversations with company owners, client owners, about the impact of the work on the client.

Crispin Manners: 17:32

So really smart professional services companies start with the client outcome and establish the value to the client of achieving the outcome. And if it's a million pound outcome and your contribution to achieving it is significant, then you can obviously charge a whole lot more than if it's a hundred thousand pound outcome. But most agencies don't even try to calculate that, so that the conversation about price usually starts with the client deciding what the budget's going to be. And what I've been hearing this year and I don't know if you guys have had the same experience, but what I've been hearing this year, not just from agencies in the UK but from all around Europe and also in the US is that clients' willingness to vote decent level budgets has diminished, diminished, um and as as agencies are going into the sort of 2025 round of negotiation with their current clients, they're being told budgets are being reduced and the main reason for that is they haven't proven to the people who create those budgets, uh, why they should be spending more is this a collective failure from the industry, then All industries, all industries.

Crispin Manners: 19:04

It's a total failure of the PR sector in general of proving value, and it's one of those arguments that you know, I know if anyone ever listens to this particular podcast, there'll be people out there going well, it's impossible for us to prove our value. I reject that completely. All you need to do is ask the right questions to establish the basis on which clients will be measuring the impact for themselves of what they're trying to achieve.

Will Ockenden: 19:42

Can you give us an example of that? I think bringing that to life would be really helpful.

Crispin Manners: 19:46

Yeah, one of the examples in the book that I used was an example that came from an agency that I was helping, and it was a client that delivered in-home optometry services. You probably see, spec savers are advertising that stuff quite aggressively now, but this particular client had first mover advantage in that sector and they were private equity backed and they had very aggressive growth targets. But they could only achieve those growth targets if they recruited optometrists. And recruiting optometrists is quite difficult because most of them most of them work in the National Health Service. So luring people away from what we all know all the criticism about the NHS but luring people away from what we all know all the criticism about the nhs but luring people away from what is a secure job to a company that they probably haven't heard of, whose private equity backed and therefore might feel high risk is, is not particularly easy. So the the client wasn't recruiting at the rate that they needed.

Crispin Manners: 21:02

So they turned to this agency to try and help them and the instant reaction of the agency was to say, well, okay, what we'll do is we'll raise awareness about the opportunity, and they thought about what that meant they would do. They added up the total hours and they came up with a price and the price, the initial price, which they ran by me, was a one-off project fee of £5,000. And the first question I said is how much are these optometrists paid? And the answer was £60,000. And I said said well, how are they recruiting at the moment? They said through, through recruitment agencies, and I said so. They're paying 20 at least of the annual annual salary and if you do the maths on that, that meant they were prepared to pay 12 grand for every optometrist and they wanted to hire 80 you know, yeah, you do, you know 80 pounds

Crispin Manners: 22:02

okay yeah, a lot of money right and and our agency was going five. This agency was saying we're going to charge you five grand to help you. What I then got them to say was okay, so where will you contribute? What's what's broken in their recruitment process? One was obviously not enough of the right people were hearing about the opportunities. Those that did weren't necessarily the right people to apply because the conversion from CV to actual interview was really low. So they could contribute by getting more of the right messaging out there. And there were about to cut the long story short there were about three or four key touch points on the journey from potential applicant to a hire where they could make a significant contribution. So on the back of that and the fact that the client was clearly prepared to pay a million quid to get these 80 people, they came up with a bigger number. I mean it wasn't as big as I thought they should be charging, but it was still. Initially it was four times the original. So same work four times the price.

Chris Norton: 23:20

And did they get the job they did they got the job.

Will Ockenden: 23:25

Yeah, they've really articulated it.

Crispin Manners: 23:27

Yeah, well, and the client? After the initial round, the client came back for more because recruiting with their assistance was much more effective than without it. And that's the other thing I think that agencies aren't rigorous enough about is saying, well, where else can the client go to get the same contribution, and how and where are we better than doing that? Agencies talk about awareness all the time, but clients can get awareness lots of ways, can't they? Pay-per-click or stuff. But is it the right awareness with the right people and the right message, and does it convert to anything? I think if you approach it like that, you can actually start stealing budget back from other budget lines if you can demonstrate to the client that not choosing you is actually a high-risk strategy.

Chris Norton: 24:24

To argue that point, though, crispin, because obviously we pitch all the time and we use Amec, which is based on the Barcelona principles, and we do measure impact. It's one of the things that we're proud to do. But I will say that when we're doing, what I liked about your approach is you reverse engineer the actual total first and then you wind it back to and if you hired us, this is how much you'd be saving. So I like that example. But on the flip side so for the marketers listening to this with the budget so saying I've got 60,000 pounds next year for my agency, if they get, you know, they called prohibition to come in and pitch to them. We came in and pitched against their retained agency. Their agency said this is what we're going to do for £50,000. We come in and go yeah, but we can demonstrate this, this and this and this, and we're going to charge you £65,000.

Chris Norton: 25:21

Usually, the client will go with the cheapest client. I hate to say it, and that's what most people in this industry will be shouting out going. It's all very well that you can demonstrate return on investment, but money is money and they just look at the numbers and go yeah. But if I get them to do this. They'll do it cheaper Because we had a pitch we won last well, I won't say when, but we won it less than 18 months ago and we got right to the. They loved the ideas, they loved the strategy, they loved our videos, they loved our approach. We got right down to it and they were like the price you're more expensive than the other guys. Can you knock, knock down the?

Will Ockenden: 25:50

fee, but playing devil's advocate on that and I'll, I'm sure you've got a view on this as well. Um, crispin, is it not about, um, like crispin said, asking those right questions?

Will Ockenden: 26:02

where you do, you do almost come up yeah, you come up with that value, and I like what you were saying about. You know what's the cost of not doing this. So, for every client, there's going to be a um. You know um, 20 recruitment fee equivalent isn't there, you know um, and and it's up. Is it up to us to find out what that is and then show how our solution will deliver value. In that context, I mean, yeah, I get it. It's easier said than done because you, often the client won't know either, will they?

Chris Norton: 26:29

no, they'll say we want brand and you crispin. You're completely right, we want brand awareness and you go. Okay, great, how you measuring brand awareness? And then they look at you and go um.

Will Ockenden: 26:39

So I suppose other other examples we've had. You know, one client wanted to reduce um. This was for a social media brief. They wanted to reduce um calls to their customer care center. So there's a there's a cost associated with each call that each customer service operative takes, and I think we won the pitch by demonstrating how our social media intervention could reduce the stress on the call centre by, say, 20%, thus saving X. So is that what we're talking about? Just really kind of pushing to get to those?

Crispin Manners: 27:13

Well, yes, exactly, and I think the example you gave there is a good example of what I'm starting to see increasingly is that clients are coming with a brief which has a business outcome reducing the number of calls to our call centers. I ran a bespoke training session for a quite large agency this year this year, and I asked them ahead of time to send me examples of the client briefs that they were being presented with and I expected them to be all activity-based briefs, you know, like raising awareness etc. And I was really surprised because most of them were all about delivering a business outcome. I mean, there was one from an insurance company which was a brief to contribute to them winning a billion pounds worth of net new business. When a client's got that kind of clarity about, effectively, what the brief said is we are putting a team together to help us win a billion pounds worth of net new business and PR a PR agency is one part of that team and we want you to show us how you will contribute to increasing the certainty of achieving that. So I mean to answer your question, chris.

Crispin Manners: 28:50

If you're being presented with a brief with a budget attached, it's probably already too late in the sales cycle for you to be able to influence the price.

Crispin Manners: 28:59

So my view is that if you position yourself as an agency that is capable of making valuable contributions to achieving really important goals, it's much more likely that you'll have conversations with the people who care about the business goal rather than the activity to get there. This is why I'm saying you know the book was into chapters there is a positioning job to be done that says we're capable of helping you win a billion pounds worth of net new business. A lot of people in agency that when I say things like that and go, yeah, but we can't guarantee they'll get a billion pounds worth of net new business. But the reality is the client isn't asking you to guarantee it. They're asking you to show what your contribution will be. You know it's a bit like putting a football team together Are you going to score the goals, save the goals, make the killer pass to create the goal? And agencies by and large don't make that contribution clear or the risk of not receiving it clear either this is.

Will Ockenden: 30:07

This is fascinating and I think what, what, what I found quite interesting about what you've said. There is, and there'll be lots of brands listening to this who are putting out pr briefs or social briefs or marketing briefs all the time. So what I'm hearing is you know, if they can make that link to business impact in that brief A, they're going to get a better response from the agency. You know they're more likely to have a campaign or an activation that actually contributes to that organizational goal. So it's twofold, isn't it? On one hand, brands need to be clear on their business outcomes and then agencies need to ask great questions to get to that point.

Chris Norton: 30:46

This is exactly what we do, though, isn't it With Amec? The first question we ask is one of the first questions we ask is what is your business objective, not your comms objectives. What's your business objective, what are you looking to achieve, and then what your comms objective?

Will Ockenden: 31:02

That's how we build our plan out yeah, and we advocate the five whys as well. So keep on asking why. And the more you ask why, the more you get to the heart of actually what the problem is, what the challenge is, what the core objective is beyond something, because often you end with a marketing objective, often you get stuck on marketing objectives don't you.

Will Ockenden: 31:22

We need more brand awareness. We need more web traffic. Why do you need more web traffic? We need more sales. Why do you need more sales? Because this skew is underperforming. And on and on and on, and then it's quite exhausting though, isn't it?

Chris Norton: 31:33

It is exhausting and some people get quite some clients get quite annoyed with it. Some don't, some are fine, but they're like why are you asking these really probing questions? Because if you don't know the answer as well, you're the marketing director and someone's saying to you but why are you doing marketing in that area? And they go. I should know this.

Will Ockenden: 31:49

It's quite embarrassing, you know, but it's better for everyone, isn't it? You know? It's better for the client, better for the agency.

Crispin Manners: 32:12

And I think, the key thing. I think well, I guess there's two things to say. There is an agency that asks the right questions can be super helpful to the comms team within the client in raising the perception of the value that comms team delivers internally. I mean one of the things again when I was actively delivering campaigns, one of the barriers we used to come up against all the time is that the sales team thought the marketing team were a waste of space and they didn't really help each other. So one of the values we delivered as an agency is we used to break that barrier down and we would go and educate the sales guys about how we'd make their job easier if they just let us have access to clients, etc. Etc. And I think agencies can do exactly the same thing in helping the guys on the inside become respected by the senior people in the business.

Crispin Manners: 32:56

I mean, we're always talking about how few comms people there are on the board and one of the reasons for that is that comms in general doesn't provide business proof of the value that they deliver. So if agencies driving that, it's going to make the guys on the inside look much, much better and be valued as a result. The second thing I guess I'd say, chris, is most agencies are small enough not to be constrained by lack of opportunity, just constrained by winning the wrong kind of clients. If you want to be known for contributing to delivering really powerful business outcomes, you've got a choice about whether you pursue an opportunity with a client that doesn't get it.

Chris Norton: 33:49

Yeah, I like that.

Crispin Manners: 33:50

The more you do of that, it'll just frustrate the hell out of you and then you'll get bored and tired and all the rest of it and it won't help the agency.

Chris Norton: 33:59

And we do do that with, with, with inquiries, like we try and bat off a lot of things that we do a we don't think that are right for us. You know you need somebody that that suits both parties, that you think you can demonstrate because the best work for me is is where you feel like you've made a difference to the client and you and you're treated like a, a partner, rather than just the bloody agency that trots out campaign, like you said, that just trots out campaigns that go in the press and you need to be valued.

Will Ockenden: 34:25

And then there's this whole episode is now about value, which is good, but it's yeah, I mean it's, it's, it's got lessons for both brands and for agencies, which is why I think there's there's real value here, can I?

Chris Norton: 34:34

ask you you mentioned before in in the show. In your show notes you put avoid the hamster wheel of growth. Do you want to explain what that's all about, your hamster wheel of growth? Because I've got to be honest, I've been on that a few times.

Crispin Manners: 34:46

What I'm really saying there is if you're good, you'll win stuff. And once the word gets out that you're good, then you'll attract more opportunities. And if you're good at the sales process, you'll win more stuff. And if I use my own agency as a as an example, when we made the shift to the tech space about about I don't know 18 months later, we were the fastest grower in the pr top 150 and we had something like 187 percent growth rate. Now, at one level you can go well, that means you went from being worth 20, having revenues of 20 quid, to 40 quid. But um, uh, joking apart, when, when you're growing at that rate, you're obviously having to add heads quite fast to to serve this business that you're winning.

Crispin Manners: 35:36

And if, if you're growing quickly, then you end up making recruitment decisions, which aren't necessarily always the best recruitment decisions. Are they the right people? Do they fit well? Have they got the right skills? Can get overtaken by. If we don't get an account manager in fast, we'll just lose the clients we've just won.

Crispin Manners: 35:58

If you keep that growth going and in our case we were number two performer in the top 150 over a decade with 34% compound growth and when you continue to grow like that, you persuade yourself you need things like in-house HR, in-house IT, in-house finance, and all of a sudden you've got 10, 12 people who aren't generating any money, which means you have to go win more clients to pay for those, which means you have to go and win more clients to pay for those.

Crispin Manners: 36:28

And all of that stuff just starts taking over and, as the leader in the business, you suddenly find you're doing all those other things that no one else wants to do in terms of running the business. And at one point, one of my other directors gave me the the name wire management man, because we were moving offices and the only guy that was prepared to pick up all the grunt around making sure we had the right office with the right furniture, with the right it, with everything else, was me. Um, and it bored the pants off me, but someone had to do it. And was it the best use of me in doing that? Probably not, because the company could probably have got much more value out of me doing the things that I was super good at, as opposed to just moderately capable at. And the hamster wheel of growth blinds you to all of those important choices.

Chris Norton: 37:24

Yeah, I mentioned that because you said that's what happened to you and your mistake. You said, basically, you fell into the hamster wheel of growth. What sort of year was that then where you thought because I get it, because you don't. When we start an agency, you're right, we start an agency right back to the beginning of what you were saying. You start an agency with a vision for right. Mine was like I want to work for myself, I'd like to work with some people, I want to create an environment that is fun, not too challenging, but I want to work on interesting work, not boring clients. Interesting work where we can make a difference in some way, and hopefully I don't have to work 180 hours a week like I was doing when I was freelance. I had to make the supplement from freelance to owner, owner, manager, and then that's the.

Chris Norton: 38:09

That's the inkling stage, where you start and you, you give your money away to hire other people. Then you start getting bigger and bigger and bigger, but before you know it, you're 10 people. And then you're like right, okay, we're 10 people, and now we want to do you know, let's go for 50. All we know is to grow. That's right, that's what you do and you say you're looking at growth, you're looking at growth, and then, before you know it, you're 15 people. And is this what I mean? How big were Kaizo? Before you realized you were in the hamster wheel of growth, where you were just trying to feed the machine.

Crispin Manners: 38:39

Well, I think, before I answer that direct question I think you made the point suddenly you find your 10 people and then your 15 people and one of the things I did find at the point I recognized this when we were we had probably got to about 25 people is there are some key.

Crispin Manners: 38:57

There are there are some key thresholds in running an agency, which which arrive actually quite early on in the development. So my view is that anything less than about 12 people can be run through osmosis being around the office, because there aren't so many people that each person cannot get a touchpoint with the leaders and the energizers of the agency and therefore you don't have to be very process heavy. But once you go past about 12 people, all of a sudden, if you haven't got process, then you find that certain people start to become very disconnected, and being disconnected is obviously a bit of a disaster if you want to have a happy ship and a productive ship. So suddenly you have to start putting process in by the time you've got up to 25, you don't just have to have processes to run it, you have actually have to have processes that satisfy people who are going to audit whether or not you're running the right way and have you got the right policies, like DEI and all of those?

Chris Norton: 40:10

other things.

Crispin Manners: 40:11

So if you're the kind of person who just wants to do great work and you don't want heavy duty HR systems, you probably want to keep the business about 10 to 12 strong maximum. But if you've rattled past that, then you've got issues of well, have I now got to lay people off because I feel like we've got too big? And if you don't want to lay people off, then suddenly you find that you're trapped in feeding mouths rather than achieving what you wanted for yourself.

Will Ockenden: 40:47

So how did you? Did you get off? Yeah, that does.

Chris Norton: 40:50

Literally. When you said that, the producer looked at me like we're trapped in this business. We've got people working for us and we're trapped.

Will Ockenden: 40:58

Did you get off the hamster wheel? I suppose is the question people will want to know. And how did you? If yes, yes, how, or did you just exit the business?

Crispin Manners: 41:06

the reality is because, I mean, chris said, when I moved from being freelance to setting up the agency, I realized I wanted to do this, this and this and this. I never had any of that. I got a job and then I've found myself running it and then I found myself winning stuff and I hadn't hadn't thought about any of that, I just kept on going. So, in that sense, not not very bright, I mean, we, we, we, we grew I don't know what we were at our largest, 60 odd people, um, and one of the mistakes I made was that because I hadn't really thought about what the agency was supposed to be doing for me, by the time I got to that point, I was, I was tired. So, and and you know, if you're tired, if you're tired when you're 28, it's very different than being tired when you're 48 and your ability to bounce back and just to re-energize yourself.

Chris Norton: 42:07

I am. It depends what time of day it is.

Will Ockenden: 42:09

I'm 47, so it's not far away from that you have a brief spell of energy at first thing in the morning, yeah, and then it's tired tiredness and lethargism, if that's a word so. So I suppose um, not every, not every large agency will be on the hamster wheel of growth, but lots are. Is that a fair assumption when you're not clear on your why? It's like that? Simon Sinek book the Power of why isn't it Having that? Why about?

Will Ockenden: 42:39

what you do the reason that transcends what you do. Like the Dublin agency you gave. They've got a higher purpose, haven't't they? So I suppose understanding your purpose would would help, wouldn't?

Chris Norton: 42:51

it purpose, but not in a, not in the marketing. We're sustainable reason. You mean, like what your actual why? Why are you getting out of bed? Why are you turning up to work? Why are we employing look at the producer again why are we? Why are we employing people? What? What is the reason for that? That sort of purpose, what? What is our purpose? God? That's a it's a very, um deep question for this podcast well, so we'll, we'll spot on my.

Crispin Manners: 43:21

It's a chapter in the book. My view is that you have to have total clarity on that because then it makes it really easy to make the right, the right business choices and right personal choices. Um, whenever the word purpose comes up, you you can get into a debate that and? And the sort of classic quote is we do pr, not er. You know we're not curing cancer and all that sort of stuff.

Crispin Manners: 43:47

But the reality is, I mean, there's an agency I help who focuses on healthcare, and they focus on healthcare because the guy who runs the agency wants to feel like he's improving, he's helping, contributing to improving the health of the nation. He's not a doctor, he's not designing drugs, but he is helping organizations who can make that impact operate more effectively. And it's what gets him out of bed, a bed. Um, but your purpose could be I want, I want to make as much money as I possibly can before the age of 40. I mean, it doesn't have to be about curing cancer, it just it just has to be something that guides your decisions. Um and uh, a lot, of, a lot of agencies haven't got that clarity. How can they get it?

Will Ockenden: 44:42

it does make it much harder to make the right decisions will's asking for a friend yeah, asking for a friend, how can I mean is is there, you know, because there must be a ton of agencies and actually a ton of companies that aren't necessarily agencies, that that don't have that purpose, and they just kind of trundle along and they're probably very successful. But what would you, what would you say to anyone really that wants to discover their purpose? That's probably quite a big question their personal purpose.

Will Ockenden: 45:11

Well, yeah, or an organisational purpose. I mean, is there a framework? What would you say to that? I assume you counsel companies on this.

Chris Norton: 45:20

I bet you get Maslow's hierarchy of needs out and throw a dart at it.

Crispin Manners: 45:24

I think if we're talking about an owner run agency, then it's really important for the owner or owners to really think about what they want first and and a lot don't. Um, and just to give you an example and it's actually one I quote in the book and it's a real life one a guy I, a guy I have helped now for probably about 12 odd years, when we, when we had this discussion about what mattered to him, one of the things he wanted to be able to achieve was to put his kids through university in the States and he runs an agency in Central Europe and at the time was not drawing much out of his agency to try and persuade himself that it was profitable his agency to try and persuade himself that it was profitable. When he said I want to do this with my kids, it instantly brought into focus the fact that if he continued to charge what he was charging his clients, that would never be possible. So he suddenly had a reason to go back to his clients to tell him he was going to increase his prices. Reason to go back to his clients to tell him he was going to increase his prices, and he was obviously anxious about that. But they all agreed and because they were still too low. But they agreed to the increase.

Crispin Manners: 46:54

And a few years later he had the opportunity to take on a representative role for an organization outside his own agency. And he asked my view and I said, well, you've really got your agency running really well and it's generating what you want. Do you want to have a distraction from that, because this other thing will distract you? And at that point he said, well, I'd like to do this because it'd make my parents proud. And I said, well, okay, if that point. He said, well, I'd like to do this because it'd make my parents proud. And I said, well, ok, if it's that important to you, then maybe you should do it. But if we fast forward about two years, he did take it on. It did distract him. His revenue in his agency declined and therefore the profitability with it, but when he came back in with his full attention it recovered. Now you might say, well, ok, that's fine, it was worth doing.

Crispin Manners: 47:56

But about a year later he was approached by someone who wanted to acquire his business and he had an idea of what his business was worth and the acquirer offered him exactly half.

Crispin Manners: 48:07

And they offered him half because he had had that dip in revenue and therefore they saw his business as higher risk and with not not a nice, resilient income stream. So but if he had, if he had admitted to himself that not only don't want to put the kids through university, but I also want to make my parents proud by having a high profile role somewhere, he could have structured his agency to be allow him to do that. But because he hadn't thought about that, he created a weakness which meant he missed an opportunity to exit at the price he wanted to, which meant he missed an opportunity to exit at the price he wanted to. So thinking about this stuff earlier is so important, because if you don't think about it until too late, you end up getting tired, like I did. So my view is start thinking about it even before you start your agency, but certainly within the first year.

Chris Norton: 49:03

If you haven't, you haven't done it before that I've got a question for you, because that's interesting, on what. What you start and, I think, what you're going to start with your business. But you've just given me an interesting uh thing to discuss with will at four o'clock today about what our purpose is. Um, I'm busy then, unfortunately yeah, there you go my.

Chris Norton: 49:21

my purpose is to to get get some time in the diary. What advice would you give new agency leaders trying to scale their businesses while trying to still deliver value? What sort of advice would you give someone let's say, someone's out there they've got a business of five or six of the consultants? There's a lot of agencies out there, whether they're digital agencies, pr agencies, marketing agencies small little shops that are doing good, great work and they just work on referral. What advice would you give to them? If they want to scale but they don't know how, what's the sort of key advice you'd give them?

Crispin Manners: 49:54

Well, the first thing I'd do is I would ask them to ask themselves why they want to scale. What's the purpose of scale? Okay, to give you I mean to give you an example. As I mentioned, I'm helping. I'm helping guys prepare for exit, and one of the key things that you want to do there is to is to really build profitability, because it's appealing to an acquirer. It's also quite appealing to the owner if they're generating more, because they can take out more, but even before they've sold. If you look at some of the results of even some of the larger agency groups out there I mean I was looking at one of them I think it was an X15, but it might not have been and I think their profit before tax was 9%. Now, if you're a relatively small agency and you're thinking of scaling and just use these numbers as an example, if you're 1 million fee making 40%, it's the same amount of money being generated as a 4 million fee agency generating 10%.

Will Ockenden: 50:58

True, with four times less headache as well.

Crispin Manners: 51:02

Well, think about all the extra work that the leaders have got to do to fuel 4 million rather than 1 million. So some people will be shouting at the screen going well, who can make 40%? Well, you know you can if you position it right. So what does scale mean? Does scale mean scale the profit or does it mean scale the people? And if it's the people, do you then want to get into all of this extra process you have to have? I'm not saying it's a bad thing, I'm just saying it's not right for everybody.

Crispin Manners: 51:36

And you've got to really know yourself, to know what will energize you, make you happy in the process of scaling. So what will energize you, make you happy in the process of scaling? Once you've got that clarity, if you really want to scale sustainably, the next thing you've got to be really, really all over is what is the solution we're offering to the market? Not what are the services, but what's the solution. What are we really really, really good at?

Crispin Manners: 52:04

And you know I help an agency in Milan and you know, when we looked at, what they are brilliant at is they are brilliant at launching products and brands in Italy. And because they are so successful at launching products and brands in Italy. They can charge a premium for that launch process. You know effectively that. You know their promises will deliver success on arrival in Italy. They can charge a premium for that launch process Effectively. Their promise is we'll deliver success on arrival in Italy. Now that's very different from we'll do you a press launch. So if you really want to scale, make it easier to scale by attracting the right kind of client that you know you can go on to satisfy by having total clarity about the solution that you have on offer.

Will Ockenden: 52:46

If that makes sense that does fascinating if you?

Chris Norton: 52:49

you've been on the show now. If you were, if you were us, who would you interview next, and why?

Will Ockenden: 52:54

oh my gosh everyone does that we should brief people on this question yeah, we should who, who would I?

Crispin Manners: 53:01

um, I would, I would go, I I would interview the chief exec of of a couple of clients about their perceptions about the value that pr agencies can deliver and what, what an agency would have to do to persuade them to part with more money for the pr budget. That'd be an interesting perspective we've actually got.

Chris Norton: 53:21

We've actually got a ceo of one of our clients the first one ever, because we thought we'd bring him on the show in a few weeks. So that'll be interesting, quite bold question in there to do live on the podcast Could be quite a sobering answer couldn't it yeah.

Chris Norton: 53:37

So how do you work now, crispin? This is my second to last question. Penultimate question how would you work with? So if there's an agency owner out there they've listened to this. They thought crispin really knows his shizzle how can I get hold of him, and what sort of services do you do other than, yeah, it sounds like. It sounds like. When you were talking to will, I felt like it was quite a cathartic experience for william he was getting it out.

Will Ockenden: 54:01

It was cathartic yeah it feels so.

Chris Norton: 54:03

It's like a consultative approach. What is it that you do with?

Crispin Manners: 54:06

with owners, I suppose well, first of all, I only want to work with, I only work, want to work with people who, um, um, feel like they need help to achieve something important. Okay, so, given those two things, the way that I normally work is I first of all start by doing what, what will was saying earlier, which is I ask the wise, you know why do you want help? And and I go up, that I go up the stack till we get to the point which is where, asked the wise, you know why do you want help? And and I go up, that I go up the stack till we get to the point which is where we've got the most important reason to have someone like me on board. And if, if, when that reason surfaced, I think I can contribute, then it's a case of identifying where those contributions will be.

Crispin Manners: 55:06

And if, for example, we're just not growing fast enough, or I've got a 10-year plan and I'd like to exit in 10 years or earlier and I want to prepare for that, the way that I would work is we would identify the number one priority to go for, to achieve whatever it is that agency owner is trying to achieve, whether it's exit or more profit, or more work-life balance or better recruitment strategy, or whatever it might be okay and then the way that I do that is, I essentially facilitate the owner's own thinking, because one of the things I've found is that there are certain consultants who will go in with their cookie cutter and go this is what you do, um, and that is only ever partially successful because it doesn't have the buy-in from the owner.

Crispin Manners: 56:05

So essentially, what I try and do is get the owner I get the light bulb to go on with the owner about what's the most important thing for them to focus their time and attention on, because then stuff happens.

Will Ockenden: 56:18

Crispin, people will be listening to this and they'll be wanting to get in touch with you. What's the best way they can find out about what you do?

Crispin Manners: 56:23

I would ask them to send me an email so we can set up a call, and my email address is my name, crispinmanners at onvacouk.

Will Ockenden: 56:33

Fantastic.

Chris Norton: 56:33

And you're also on LinkedIn extensively and we'll put your details in the show notes. Crispin, thanks you so much for your time. Bit of a different episode, this, where we talk about owning agencies, whether it's pr, marketing or digital. It's all. It's all been useful, I think, for agency owners, um, and fascinating for me, um, and I'm definitely gonna have that conversation with will at some point later today and also for for for those, for those brands, wanting to write better briefs.

Will Ockenden: 56:58

So I think there's there's value across the board. But, yeah, thank you, chris ben my pleasure.

Crispin Manners: 57:02

Take care everyone and thanks, sir. Thanks for inviting me.