From Price to Value: How Creative Agencies Can Build a More Profitable Business

Rayhaan Moughal

As agency advisors, we’ve come across a lot of creative agencies that are still competing on price to stay ahead of the competition. However, this approach often leads to narrow profit margins, difficult customers, and financial troubles. Instead of trying to undercut your competition, it's essential to find an alternative competitive advantage if you want your business to grow and serve you.

Here's how to stop competing based on price and shift your focus to create a more profitable and sustainable agency:

So When Should You Cut Your Prices?

As a creative agency, the answer is almost always never! It's challenging to get a cost advantage in this space because your largest fixed cost is people and their expertise. Competing on price as an agency only means smaller profit margins and limited growth, or lower quality deliverables that lead to high churn. If you can't sign a client at your price point, walk away and revisit your value proposition.

Ward Off the Vampires

Dealing with vampire clients is a challenge that every agency owner has faced. These clients question the price of everything and don't see the value of anything, making them challenging to work with. When you stop competing on price, these vampire clients may fly elsewhere, but that's a good thing for your agency. You can focus on attracting high-value clients who will contribute to your bottom line and allow your business to grow.

Start As You Mean to Go On

During the startup stage, it's easy to compete on price because of a lack of confidence in your offering. Instead of trying to attract business with low introductory prices, bake in the fact that you won't be competing on price in your business plan, and keep this intention at the forefront of your mind. While rejecting clients willing to pay you in the short term may feel strange, you'll be far better off as your agency grows.

Track the right metrics

Focusing solely on the number of clients as a measure of success can drive the wrong strategies. It's far easier to manage 10 high-value clients generating £100k in revenue compared to 50 clients generating the same amount. Identify the metrics you need to impact to take your agency where you want to go, and track those with laser focus.

Make Value Your Selling Point

Price and value are not the same. If you want to convert high-paying clients, you need to communicate the quality of your offering to them. Invest in your own marketing and messaging to demonstrate your expertise to the market and show up as the solution to your audience's problems.

Work To Find Your Optimum Price

Finding your optimum price requires testing, adjusting, and retesting over time. A good starting point is to set a minimum profit margin you need your agency to achieve to support your growth plans and set a price that achieves it. You can then increase prices over time as you collect data on conversion to find the optimum price that maximizes profits.


Competing on price is never an effective strategy for a creative agency and often leads to financial uncertainty, low-quality service, and a stressful business. Instead, compete based on value from the beginning.

If you're running an established agency and still competing on price, it's still possible to change your approach to give you more time, more money, and less stress. Re-evaluate your client base and let go of those vampires that are hard work. Work on your marketing and sales strategy to focus on quality and value and onboard new clients at a profitable price point.