In listening to agency leaders lately, I hear a lot of concern about the cost of AI tools.
Some heavy users of AI talk about how to share accounts and skirt personal account limits.
And I’m all for saving a buck whenever you can.
But if your focus with AI tools is the price you pay, you’re missing the point.
I’ll explain more a bit later in this newsletter, but first look at our latest content and the resources that Jen has rounded up for us this week.
— Chip Griffin, SAGA Founder
Latest from SAGA
EVERYONE IS USING AI. NOT EVERYONE IS USING JUDGMENT. Adoption is not the hard part anymore, it’s figuring out where AI improves your work. In this week’s SAGA Signals, I cover what happens when the metric becomes usage rather than outcomes — and why agencies producing volume without a real point of view are paying a cost they may not even recognize yet.
STOP OVERSELLING THE PITCH. Many agency owners treat a group presentation like a performance, worrying about the running order and the slide deck, when the real differentiator is the conversation. In the latest Agency Leadership Podcast episode, Chip and Gini walk through how to prepare for group presentations and pitches — from matching your team’s expertise to who the prospect is bringing, to why the people in the room need to be the people doing the work after you win.
Jen’s Weekly Roundup
WHAT CAUGHT MY EYE THIS WEEK:
ALL UP IN YOUR NEW BUSINESS — Lee McKnight, Jr at RSW/US details how you can back your new sales hire instead of sabotaging them in Your New Business Director Isn’t a Silver Bullet. And Jody Sutter reminds us that our story-telling capabilities shouldn’t be limited to our clients in Your Case Study Is a Story. Start Treating It Like One. The best case studies that contribute to winning business are built around a narrative.
CONTENT, CAMPAIGNS, AND THE PESO MODEL — For a real-world example of the model in action, Gini Dietrich at Spin Sucks walks through The PESO Model® Diagnostic: The Budweiser Super Bowl Ad, examining the gap between coordinated and integrated. Also from Spin Sucks, Shannon Burch makes the case that it’s ok to start small in Why a Lean PESO Model® Campaign Can Win the Race. Doing everything at once can lead to burnout.
WE’RE HUGE FANS OF SHARON TOEREK — Like Roy Kent, she’s everywhere this week, and for good reason. At The Innovative Agency, Sharon talks with Roger Nairn in The Modern Agency Content Playbook about why depth, consistency, and findability are what separate content that builds authority from content that fills up your time. And over at Dan Englander’s The Digital Agency Growth Podcast, she makes the case in Turning Legal Into an Agency Profit Center that most agency owners treat legal as a cost to minimize when it’s actually a tool for protecting and growing revenue.
THE BEST OF THE REST — Marcel Petitpas and Kristen Kelly at The Agency Profit Podcast walk through a clear framework in Profitability Sequencing: How Agencies Maximize Margins: build your model first, then forecast, then layer in data. The order you take those steps in matters more than you think. And David C. Baker at Punctuation writes in Being Reluctantly Offensive that leading clients requires telling the truth, even when they don’t want to hear it. It’s one of the main reasons they hired you.
— Jen Griffin, SAGA Community Manager
Focus on AI value, not cost
It’s always helpful to avoid overspending in your agency. And it can be very easy to pay for lots of tools and services that you don’t use and see the total costs pile up.
With the proliferation of AI-enabled tools and services available today, it’s easier than ever to spend senselessly.
But your focus shouldn’t be primarily on the cost of those tools and services, but rather the value that you receive from them.
When I hear heavy users (and strong advocates) of AI talking about how to time their AI usage to avoid limits or sharing accounts to reduce costs, I’m befuddled.
And most agency owners I talk with are worried about shifting from entry-level tiers that cost $10-30 a month to the max accounts at $100-200 per month.
At the same time, both groups extol the value of the AI tools in helping them to be more efficient or effective.
If you’re an agency leader and you’re even a tiny bit more productive or efficient, surely that’s worth well over $200 per month. At the rates you should be charging, it only takes an hour or two of saving a month to more than pay for that subscription.
Even your junior team members won’t need that much improvement in their output or effectiveness to justify those higher tier accounts.
And if you’re a power user utilizing API-driven tools, your even higher costs may well be justified if you are generating enough value.
That value equation is the key to assessing your AI usage and costs. If it is sufficientiy valuable, you shouldn’t have any issue with paying higher costs. If it isn’t, then you probably shouldn’t use it even at the lower price point.
Sure, we all want to save money. Nothing wrong with that.
But we all need to understand that the AI free ride can’t — and won’t — last so we need to zero in on the ROI of our investments sooner rather than later.
Otherwise we run the risk of being penny-wise and pound foolish.
