Reducing Cost Overhead At A Startup Advertising Agency

Office 365

It is ironic that agency-based businesses, that help businesses and individuals grow their businesses, are sometimes badly managed themselves. A lot of the expenses that an agency incurs come from an inadequate use of technology. Advertising agencies in general are still largely dependent on legacy tools to manage their business. This is because these businesses work with clients from a diverse range of industries.

So while some clients have the latest technology tools on their end, others do not. This often forces these agencies to resort to the lowest common denominator of technology in order to cater to their diverse portfolio of clients.

A significant chunk of digital media planners still use MS Excel to create their monthly plans. This is because of the obvious benefits that a generic platform like MS Office offers – it may be used out of the box with little specialised training. Also, these tools can work under most circumstances and most importantly, it integrates quite well with other third party tools that your business may use.

However, the use of generic tools come with their own set of problems. Customising your documents to match the unique needs of each of your clients can be cumbersome and this often leads to a loss in productivity. In effect, this necessitates a larger workforce and thus increased overhead.

Technology is just one of the several areas where startup agencies face high overhead costs. Real estate and equipment purchase are others. Agency owners can however bring down the overhead costs quite dramatically with the following strategies.

Migrating To The Cloud

A good first step towards reducing overhead would be to replace traditional MS Excel-based planning with cloud-based alternatives like MS Office 365. Doing so reduces two critical pieces of overhead – it improves productivity since cloud-based tools make it easier for agencies to collaborate with their clients. Any potential wrong entry may be fixed much sooner than they would have been with standalone software.

Secondly, cloud-based tools also make storage and data backup processes cheaper. Agencies have traditionally kept physical copies of their client records and monthly spreadsheets for archival purposes. Relatively modern agencies keep soft copies instead. Cloud storage of these documents however make archiving much simpler and cheaper compared to the other alternatives.

Switching To An Internet Line

Besides the cloud, agencies can also save a significant chunk of overhead by migrating their processes to the internet. One way to do this is by replacing their fixed line telephones with VoIP alternatives. VoIP services are much less capital-intensive than traditional PBX services and help drive overhead down. Marketing agencies that offer face-to-face interaction between the consultant and the client could also look at replacing onsite-travel with online video conferencing alternatives. In both these cases, moving to an internet-based solution drives down costs and brings down the overhead very significantly.

Telecommuting Policy

A growing trend among agencies is to offer telecommuting to employees. This allows for more flexibility to employees and is also a terrific way to boost staff morale. Most importantly, a telecommuting policy helps an agency save overhead on rent and energy consumption. A lot of the tasks that agencies perform is at the back-end and as a thumb rule, such activities are not bound by location. It therefore makes sense to reduce overhead by letting employees work from home and collaborate with colleagues and clients online.

Agency businesses, especially those who cater to small and medium sized clients, are in a price sensitive industry. Every penny saved in overhead contributes towards lower costs of doing business and this benefit can be passed on to the customer. What other strategies do you think can help accountants reduce overhead? Share them in the comments.

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Benjamin S Powell

Benjamin S Powell is the founder and CEO of DSA Global, a Thailand-based digital marketing agency and Startup incubator. With a raft of successful startups and exits under his belt, he consults to all levels of the tech industry throughout the Asia-Pac region.

  • To enable effective telecommuting, communication tools are essential. We use Slack (https://slack.com/) for our day to day communication. It provides a nice written record of what was discussed in passing with a colleague remotely. We also use Branded Bridge Line (https://brandedbridgeline.com) for our daily team meetings and calls with clients. They provide free call recordings so there’s always a record of what was agreed to for the day.

  • All discussed point are very important for reducing cost. About cloud migrating yes it’s a business boosting technology and every entrepreneur should go for it.