Running a marketing agency successfully requires more than just creativity and great client service—it requires a clear understanding of the numbers that drive your business. If you’re a CEO and don’t know your financials inside and out, you don’t truly know your business. Numbers tell the story of how well your agency is performing, and without this understanding, it’s impossible to make the right decisions to keep your agency profitable and growing.
Know Your Numbers
The most important thing for any CEO is to be deeply familiar with their agency’s financial data. This means going beyond just looking at revenue; you need to understand your profit margins, Cost of Goods Sold (COGS), operating expenses, client profitability, and how each department is contributing to the overall financial health of the agency.
If you’re unsure of your numbers, it’s difficult to identify where improvements need to be made or where problems are lurking. Many agency owners think that high revenue equals success, but the reality is that if your COGS or operating expenses are too high, your profitability will suffer. Know what your numbers are and what they mean for your agency. This is the foundation of good financial leadership.
Communicate Financial Goals to Each Department
Once you have a firm grasp of the financials, the next step is to clearly communicate those goals to each department. Every department in your agency contributes to the financial success of the business, and each department head must understand their role in achieving these goals. For example, your operations department needs to know what budget they must work within to ensure client work gets completed efficiently while staying within financial limits. Similarly, your sales department must know the targets they need to hit to generate new revenue and ensure the company is growing at a sustainable pace.
Communicating financial goals to department heads ensures that everyone is aligned and working toward the same objectives. This transparency is crucial in keeping the agency on track and identifying where adjustments need to be made to ensure profitability. When each department understands the financial targets they are responsible for, they can make informed decisions that contribute to the overall financial health of the agency.
Hold People Accountable to Their Numbers
The final piece of the puzzle is accountability. It’s not enough to communicate goals; you need to hold each department head and team member accountable to the numbers they are responsible for. Accountability doesn’t mean threatening people if they don’t perform, but rather making it clear that achieving their goals is crucial for the success of the agency—and for their continued place on the team.
A good analogy is to think of your agency as a sports team. Every player has a role to play, and they are expected to perform in that role. If a wide receiver doesn’t score touchdowns, they’ll eventually be replaced. The same principle applies to your team—if someone is not meeting their targets, they need to understand the impact this has on the agency. It’s your responsibility as a leader to ensure that everyone knows what’s expected of them and to provide the support and training they need to meet those expectations.
However, accountability doesn’t have to be a negative experience. It’s about creating a culture where people take ownership of their goals and strive to meet them. Recognize and celebrate achievements when targets are met, and offer constructive feedback and additional resources when they aren’t. Accountability is about fostering a results-driven culture while supporting your team to be successful in their roles.
Conclusion
Transforming your agency’s finances requires leadership that understands the numbers, communicates those numbers clearly to the team, and holds everyone accountable for their part in achieving financial goals. As the CEO, it’s your responsibility to ensure that your agency is profitable and growing, and the best way to do this is by focusing on the financial health of the business. Know your numbers, communicate them to your team, and hold them accountable—this is the leadership blueprint that will take your agency to the next level.
By treating your agency like a well-oiled sports team, where every member knows their role and strives to meet their targets, you set the stage for sustainable growth and profitability. Financial transparency, clear expectations, and a culture of accountability will ensure that your agency stays on course. And when each department head and team member understands that their performance directly impacts the bottom line, your agency will not only meet but exceed its financial goals.
Ultimately, a financially healthy agency starts with a financially informed CEO. When you combine this knowledge with the right leadership strategies, your agency becomes a profitable, thriving business—one that can weather challenges, scale efficiently, and deliver exceptional value to clients.