Reaching the Top
What it takes for Design Agencies to become Market Leaders.
Practice beats theory — all the same, here’s a lesson from business school I won’t forget, because it’s so universally true. Once, one of my lecturers said something I found rather funny: „Most people have no time to spend on strategical thoughts, except while sitting in a church.“ — Means either never, because they don’t go to church, or while listening a mess, because that’s the only time they don’t talk themselves and listen to others.
Thinking about strategy and about business ahead of the daily work is important to design agencies (as well as freelancers): If you don’t follow a strategy, you’ll run always behind. But if you have the wrong strategy you won’t run behind, you’ll run in the wrong direction. First I’ll explain you the underlying theory and then I’ll show you how you’ll become a front-runner.
Let’s say you or your company offers some services. Depending on the maturity of these services, your company will survive in the long run or not.
You can classify the maturity into 3 rough dimensions:
- Basic Services
- Key Services
- Pace Maker Services
Basic Services
I’d say that print and web design belong to basic services. Let’s face the truth: Everybody does it and most of your competitors do it faster or cheaper than you.
There’s no chance to differentiate, since there are tons of others doing the same (especially in low-wage countries). The market allocation is done, there are a few large companies that do so and even more medium sized ones. There’s really no way to beat your competitors, except with the quality. But quality is expensive and not every customer is willing to pay a significantly higher price for quality.
Key Services
There are some services that were hot topics a few years ago. For example responsive design, mobile apps or social media. Not everybody was able to do so, and still isn’t. You can differentiate with such services, but not for too long anymore. And here is the thing: Companies that were able to offer such services first got a massive chance to grow. Some actually did and became the new market leaders. (I’m sure that you can name some of these rising stars in your industry). If you are already one of these leaders, read on to find out how to stay on top.
Pace Maker Services
Here are the Jedi masters, the pace makers of the industry. If you master this service, you can be sure to gain a head start in your industry and have good chances to become a leader for years. I have some insights into the creative industry because I’m in contact with web workers every day. For what I can say, “Digital Branding” is a hot topic right now for them and their customers. Their clients need it, because everyone wants an app / responsive website, or whatever. The agencies on the other side need to ensure the same experience of the clients’ brand across all devices. Without the respective tools it’s difficult to maintain a digital branding strategy of their clients.
Basically it opens new business areas for agencies, since not everyone can provide solid digital branding. From my professional perspective there are at least not many yet. The good thing is: the market is still open for everyone.
The Risks
But there are also some pitfalls. If you bet on the wrong horse, you might lose everything. Don’t put all eggs in one basket (another lesson from the financial investment class). Companies who have concentrated on developing only flash sites, are probably on an descending branch by today. I personally prefer to invest 30% of the time and disposable funds to ground breaking project, but this again depends on the risk appetite.
Questions to Ask
Would you like to know where you or your company can be found in this market? — There are some questions you might ask yourself:
- Can you differentiate with your competitors regarding quality, process or price?
- What is your market position?
- How well do you master the service?
- How well do your competitors master the service?
- Is there a (rising / sinking) market need for this service?
Answering these questions helps you to draw your service portfolio matrix. On one axis there are the 3 service dimensions and on the other: your position / strength in this market.
Your matrix might look like this:
Conclusion
- Take your time to think about strategy
- Take your time to think about strategy every year
- Take your time to think about strategy every year and be honest to yourself
About the Author
Josip Budzaki has a passion for design and loves to exchange ideas with creative people. Before joining the awesome team @ Frontify, he was researching digital nomads and remote teams — Frontify bridges the gap between web workers. With designers, developers & clients all on the same page, building branding guidelines & design patterns is easy and collaborative again.
