#66: Why Retention is the Secret to Scaling an Agency
Running an agency is a lot messier than the highlight reels make it look. I’ve been in the trenches with hundreds of agency owners, and I’ve noticed a pattern: most agencies stall because they’re focused on the wrong type of growth. They chase new clients, hire too quickly, and ignore retention. But the truth? The real lever for profitability is keeping the clients you already have, streamlining operations, and applying smart automation.
I had the chance to sit down with Andrew DiLullo, CEO of Ad Crunch, a DTC focused agency that helps brands scale, sell out, and get acquired at higher multiples. His approach flips conventional agency wisdom on its head, and there’s a lot we can learn from it.
The Biggest Mistake Agencies Make: Chasing New Clients Instead of Retaining
When I first started out, I saw the same trap happen over and over. Agency owners get addicted to the dopamine hit of new clients. They think growth equals signing new accounts every week. Meanwhile, the clients they already have are slipping away because they aren’t getting clarity, communication, or structured plans.
Andrew put it bluntly: “You actually grow faster by selling fewer new clients and retaining the clients you already signed.” This is counterintuitive in a culture that worships scale at all costs. Retention isn’t glamorous, but it multiplies profitability without burning out your team.
The first step: play defense before offense. Ensure your existing clients see the results they expect, understand your plan, and feel the process is predictable. If they stay for 6–12 months, you’ve already built the foundation for sustainable growth.
How to Know When Your Agency Feels Like an Agency
Early on, Ad Crunch was just a pair of glorified freelancers hustling. Andrew and his partner were doing all the work themselves, running campaigns, tweaking creatives, and juggling client communications. It only started feeling like an actual agency once they mastered client retention and made their first strategic hires.
The key insight: an agency isn’t just about landing clients, it’s about keeping them. Before investing in fancy sales processes, make sure your current clients are sticking around. Once retention is predictable, you can scale confidently.
Hiring the Right People: Why Skills + Speed > Everything Else
One of the hardest challenges for agencies in the $0–$3M ARR range is hiring operationally capable people. Many founders try to automate too early or rely on low-cost VA solutions. That works up to a point, but if you’re aiming for real scale, you need A-players, people who can handle complex campaigns, SOPs, and client communication efficiently.
Andrew shared his framework for hiring:
Skip resumes and credentials: Ask for work examples, case studies, and past SOPs.
Test projects first: Give candidates a small paid project to see how they perform.
Trial period: Work with them part-time for 1–2 months to assess fit, work ethic, and speed.
Focus on communication: Candidates who respond quickly and ask smart questions often outperform technically skilled but slow hires.
Reinvest in talent: Pay what it takes to attract capable people; this pays off in client retention and operational efficiency.
Hiring strategically early sets you up to cross the $1–2M revenue hump without burning out the founders.
Retention Through Clarity: Setting Expectations Upfront
One of the simplest, most overlooked strategies is providing clarity. Clients want to know what’s happening, not just see results. Andrew highlighted a scenario where clients didn’t leave because the agency underperformed, they left because they didn’t know what to expect.
To solve this:
Create monthly plans and clear KPIs for each client.
Document processes so your team can execute without constant supervision.
Clarify what “scale” means 100% revenue growth for the client could mean 20% growth for you. Align expectations early.
This clarity prevents churn, reduces headaches, and actually allows the team to focus on high-value work instead of firefighting.
Leveraging AI and Automation Without Losing the Human Touch
One area where Ad Crunch is ahead of the curve is AI powered creative production and automation. Andrew uses tools like Arc Ads, Creatify, Poppy AI, and N8n to generate high performing ad creative, automate workflows, and scale client campaigns efficiently.
Here’s a simplified workflow they use:
Pull top performing video scripts from TikTok.
Rewrite scripts using AI tools like GPT or Poppy AI for brand alignment.
Produce ads with motion, overlays, and AI influencers via Creatify.
Automate campaign deployment using N8n connected to emails, SMS, or CRMs.
Test, iterate, and scale messaging that works across channels.
The lesson here: AI isn’t a replacement for strategy, it amplifies your ability to execute at scale. Combine it with retention-focused processes, and you get leverage that most agencies never see.
Client Wins That Showcase the Approach
Andrew shared a recent client example that perfectly illustrates the power of these combined strategies.
The client: A DTC supplement brand.
Challenge: Monthly spend was stagnant at $80K.
Action: High volume messaging testing, landing page tweaks, and aligned campaign strategies.
Result: Monthly spend scaled to nearly $300K with a quadrupled ROAS.
Notice what’s happening here: retention, strategy, and execution all working together. The client didn’t leave. The messaging hit, and the process was repeatable.
Step by Step Workflow to Scale an Agency Like Ad Crunch
Audit your current clients: Identify which clients can stay longer with better communication and plans.
Document processes: SOPs, campaign templates, and client communication workflows.
Hire strategically: Focus on A-players who understand operations and can execute independently.
Automate creative and campaign tasks: Use AI for messaging, video production, and reporting.
Retain before acquiring: Ensure clients stick around 6–12 months before chasing aggressive new client growth.
Measure, iterate, repeat: Test messaging, offers, and campaigns continuously.
This workflow balances operational rigor with creative execution and client satisfaction.
Key Takeaways
Agencies stall when founders chase new clients instead of retaining existing ones.
Clarity with clients and team is the underrated secret to sustainable growth.
Hiring A-players early is more important than saving costs on VAs or juniors.
AI can supercharge creative production and campaign automation, but strategy must come first.
A systematic approach to retention, process, and execution can quadruple results without quadrupling effort.
Scaling an agency isn’t about working harder, it’s about working smarter, retaining the clients you already have, and amplifying your operations with the right people and tools. Andrew DiLullo’s approach at Ad Crunch is a blueprint for turning a freelancer operation into a high-growth, profitable agency.
If you’re an agency owner stuck at the $1–2M mark or burning out chasing growth, take a hard look at retention, clarity, and automation. Master these, and scaling isn’t just possible, it becomes predictable.
If you’re ready to uncover your agency’s biggest bottleneck and start scaling intentionally, I offer a free Agency Mini Diagnostic. It takes 3-5 minutes and reveals exactly where to start to unlock growth.
Check it out here: agencyuplift.co/mini
