A (Stealth) Research on the Scam Behind Growth Marketing Agencies

Most of us have heard stories of founders who had a bad experience working with growth marketing agencies. Stories that (usually) start with excitement and anticipation but end with a respectable loss of earnings and disappointment. What is the reason behind this? Is there something wrong about the clients and their expectations, or about the growth marketing agencies? We will go for the latter…

There seems to be something fundamentally wrong with the way most growth marketing agencies close and serve their clients. We knew it and decided to do something about it. Is our research going to prevent you from hiring one of these agencies? Most likely not. However, it will, at least, help you, understand that when it comes to growth marketing agencies, you always need to do your research.

Contents

Why (and How) We Conducted the Research

What We’ve Discovered

Clients Are NOT the Victims

The Bottom Line?

Why (and How) We Conducted the Research

The “Why” Behind the Research

The “why” behind this research is simple: we wanted to uncover the way growth marketing agencies sell their services and close new clients. You see, nowadays we experience the spread of misinformation, the quick ones win, and so do “growth hacks” that promise growth equal to Dropbox, Airbnb, and Robinhood. However, most times, these promises don’t come easy.

What We Did (and How)

Our methodology was—once again—simple:

1) First, we did online research using terms like “growth marketing agency,” or “growth hacking agency.”

Growth Marketing Agency (Google Search)

To be clear: we’ve known most of these growth marketing agencies since we work in the same industry. The point was not to make a list of direct and indirect competitors but to follow the journey anyone searching for a growth marketing agency, could follow.

2) Then, we made a list of the most popular results in the SERPs (Search Engine Results Page).

The process that we used is relatively simple, even for someone who is not savvy. In fact, anyone can follow the same journey as we did, and see for themselves. What is more interesting though, is not how we conducted the research, but what we discovered.

Note: We used only organic search results for our research, and not results from Google ads.

3) Next, we created a list of 15 agencies, and plugged them into a Google Spreadsheet:

Growth Marketing Agencies Spreadsheet

Here is the meaning of each column:

  • Replied: If the agency responded to our initial Email.
  • Meetings Before Proposal: The number of meetings required before we got a proposal.
  • Access Asked: If the agency asked for access to evaluate our status (i.e., access to Google Analytics account).
  • Access Given: If we granted access to any of the requested assets.
  • Discovery (y/n): If the call that we received was a discovery call, meaning that the agency tried to identify our needs.
  • Proposal Speed (in days): The number of days needed, to get a proposal from the agency.
  • BS Meter: Our internal BS-and-fluff-meter

4) Finally, we contacted each one of the agencies in our list and tried to make a “Discovery Call.”

Only 4 (four) of the agencies that we contacted didn’t respond. 2 (two) of them initially responded but they never returned our call .  We never managed to reach them on the phone, probably due to a scheduling conflict or because of other reasons. Thus, we proceeded with the calls with 9 (nine) of the agencies in our list, to discuss the needs of a real company with real business needs.

What We’ve Discovered

1) Where is the Discovery Phase?

Is it possible for an agency that makes thousands (and even millions) of $ in annual revenue, not to have a Discovery Phase? You can note “yes” in that column. 63.6% of the agencies that we managed to reach didn’t have a clear Discovery Phase. If you are wondering why the Discovery Phase is essential, let me give you a quick example. Let’s assume that you visit the doctor for a health issue that you encounter. What’s the first thing  doctors do when they examine a patient? They ask questions. And, why is this important? The reason is, they can’t prescribe any medication before finding out what’s wrong with the patient.

“What surprised us is that agencies with hundreds of thousands (and even millions) of $ in annual revenue, didn’t have a Discovery Phase.”

Similarly to doctors who ask questions, an agency MUST identify what the problem is before making any suggestions. In our case, that didn’t happen. Except for two agencies*, all the others tried to sell us services without identifying the problem that we were experiencing. That’s a red flag; and, it’s so big that should scare us right away. Unfortunately, it wasn’t the only one…

*We can share contact details for the two agencies upon request.

2) Rushed (and Even Scammy) Proposals

That’s a bold statement, but most of the proposals we received were rushed (and looked scammy).

Here is what I mean:

  • 66.6% of the proposals we received were sent within 5 (five) days, with just one meeting and no discovery questions.
  • 53% of the proposals were promising “growth hacks” that were irrelevant to our (pretend) needs.
  • Most proposals were selling all of the agency’s services, without caring about our pretend business needs.
  • Some agencies used fake data to impress us—for example: “you can get 40% Reply Rate to a cold Email campaign.”
  • 26.6% of the proposals we received, promised outdated practices that could get us penalized in the post-GDPR era—for example, cold Emailing is (still) ok and works fine.
  • A small percentage (13%) included false statements—for example, x tactic optimizes Conversion Rate by 8% (as if this was a benchmark and can work for everyone).
  • Most times, it was a junior marketer who was trying to sell us second-hand growth tricks, and handled the “discovery call.”
  • Finally, many proposals were focusing on quick conversion (a staggering 40%), rather than on a thorough break-down of our problems and the proposed solutions.

Going down the rabbit hole, we found out that most growth marketing agencies use buzzwords and complex jargon to impress their prospects. To what extent? Just keep reading.

3) Buzzwords and Complex Jargon

That’s common among growth marketing and growth hacking agencies. However, throughout our undercover research, the BS-and-fluff-meter turned red. We saw how vividly agencies use buzzwords and complex jargon as a way to impress the prospect. Do prospects fall for that? Most likely, yes. For us, it was just another red flag, as we were trying to uncover the inefficiency behind the fancy words.

4) Growth Marketing Agencies = Narcissism

What is the definition of a narcissist? Well, according to Wikipedia, a narcissist is:

“A person who has an excessive interest in or admiration of themselves.”

We knew that agencies like talking about themselves, their case studies, the companies they’ve worked with or the rewards they’ve received. We hadn’t expected though that this would overshadow the Discovery Process. The narcissism involved is depicted if we take into consideration the words that we kept hearing: “We are,” “We did,” “We achieved,” and “We had.” That’s another red flag and it applied in 60% of the cases. Don’t (ever) fall for that.

5) Junior Marketers; Why Not?

Taking a look at the profile of the employees working in large growth marketing agencies, we identified a pattern. Most agencies —with a few exceptions— employ ,mostly, junior people. In fact, 53% of all the agencies, we included in the research, employ 51.5% of junior employees on average. This is not a red flag on its own; but combined with the fact that these junior employees are called to handle and solve complex marketing problems, without supervision and a clear process, can be a red flag.

Our initial assumptions came true: most growth marketing agencies care mostly about closing the sale (even though their sales process is far from outdated) and then, pass the client to a junior who must deliver on a project that far exceeds their skills or knowledge. Why? Simply because a junior is cheaper than a more experienced employee. The best part? That many of these juniors (usually called “growth hackers” or “growth experts”) are coming from totally irrelevant—and even non-digital—fields that have nothing to do with marketing.

Would you hire someone who has an irrelevant background (to what you are looking for), is inexperienced, and charges thousands of $ per month to take care of your marketing and growth needs? I hope you answered “NO” to that question…

Clients Are NOT the Victims

Clients shouldn’t employ the role of  the victim in this situation. Even if in some cases they are, they (really) shouldn’t be. “Yes,” there is a serious flaw in how growth marketing agencies close and serve their clients, but you can’t say that you didn’t know. Instead of abandoning the situation to its fate, here is what you can do:

  • Educate yourself, and compare the proposals available.
  • A doctor’s job is to fix you, not to please you. Stop buying services that please you, and start hiring responsible people that are data-driven and support their statements with facts.
  • Ask difficult (but fair) questions. Ask them about a few times they failed and why they did so; check their portfolio, approach past clients and ask about them.
  • Hire the people that explain the why’s and the how’s and stop trusting “growth hackers” and other (self-taught) magicians.
  • If you want to hire a growth hacker, at least, first, learn what growth hacking is. Watch this course to learn more.

The Bottom Line?

So, there you go: you visit the website of a growth marketing agency. You are pumped by the client logos, the (irrelevant) testimonials they have at the bottom of their page, by their well-crafted website copy, and by their “x Ways to Improve your Facebook Ads Performance” blog post. My question is: would you work with that agency?

The internet is a place where (literally) anything can be transformed into something valuable and attractive. However, most times, we don’t know what’s behind the curtain. My point is: if a shed can be transformed into London’s best restaurant, why can’t a group of junior marketers with a non-existent discovery process sell services of thousands of $ to startup founders, and business owners?

But, we like looking on the bright side of things. If anyone can (still) sell growth hacks and cheap marketing tricks with a short-term effect, then anything in marketing is possible.

Note: Throughout this process, we identified two agencies that indicated a high level of professionalism. They even resisted on giving us a price quote, if they weren’t given more information on our company and our business needs. We respect that, and we acknowledge their honesty. If you want us to give you their names, feel free to write to us, and we’ll share further details.

People Who Read This Article Also Read:

  1. How to Choose a Growth Agency That You Won’t Regret
  2. Evaluate your Marketer or Agency: The Ultimate Turbo-list
  3. What Does the Agency of the Future Look Like? (A Study by GrowthSandwich)

About the Author: Aggelos M

Aggelos M
I have over 8 years experience in Digital and Growth marketing. Currently, running Growth Sandwich, a London based Product Growth Lab. Before turning in Growth Marketing and Product Growth, I had the chance to pass by head marketing and head digital positions in Athens and London, work with numerous tech startups but also build and run companies. In my spare time, I am consulting ambitious startups about their Growth and Business strategy.