Unlock $1M Revenue: Proven Strategies for Agency Success

All right, so we have a little treat for you. So this is a coaching call from the Agency Owners Association. This is a group that Neil and I have for agency owners to help you grow faster. So if you're in the agency space, you are a services business, this is applicable to you. It's a little preview of a call. It's probably 10, 15 minutes or so, and you get a sense for what it looks like to be in the group. If you want to learn more about the group, you can go to marketingschool.io/agency. Again, it's marketingschool.io/agency. Hope you enjoy. Hope you enjoy the episode. Enrique, you're up next, and then we have one more, and then we'll keep it— we'll move it to open forum questions.

Yeah, so quick question on the cross-selling, right? I know Eric has talked about this in the past where you want more of like a surgeon as like— and I'm sorry, maybe not a surgeon, um, a guy that would— a specialist.

Yeah.

Yeah.

Um, would you want an account manager to upsell those in the backend, those different services, or do you want the sales guy that initially sold him in the beginning to Later in the contract to come in there, check back in?

No. Once a sale happens, you ideally want the account managers to upsell because they're building the relationship on a monthly basis. You also, when account manager sells, it doesn't feel like a sales pitch versus a salesperson. It's just like, yeah, we're doing this. Have you ever thought about doing this? We've helped other customers and here are the results. Like, you know, you're an ideal candidate for it and we're seeing X, Y, and Z, especially after you get into the project within a month or 2. And you can show them something, it makes it really easy for the account manager to upsell more because they're building the relationship.

And then, so right now we use a lot of overseas help, right? Um, you would, you would not recommend to use overseas account managers for US-based clients?

No, that's what—

no, you can use overseas help to do a lot of the work, but you should have the account manager be really good in US-based if it's US-based companies. The reason being is even if it costs more, People spend more money paying a good account manager by a lot, even if the exact results are the same and the service is the same. One of the biggest reasons for churn, even when people get results, is because of the account manager. Okay, gotcha.

Cool.

Enrique, you good on that one?

Yeah, that's pretty much it.

All right, Ali, and you had a follow-up?

Yeah, I think it's the same with what, uh, Nathan and other guys had also that. There's one other guy within our group. He said that to break through from 6 to 7 figures, he started to focus on one thing and focus was the key to grow basically. But you mentioned that we have to have multi-service and I'm right now, I'm doing multi-service. I'm doing full custom-based service. I'm doing everything for the companies that I'm working for. because it's the business problem that I'm solving, so they need every solution for that. But I would say, at what point would you go multi-service if you're starting from focusing on one thing? And yeah, I'm just trying to have that balance.

So you can look at focus as many different ways. Some look at focus as, I just do SEO. A better way to run a business is I do marketing for e-commerce businesses, D2C. And then you sell them multiple services for that. Or you could just start off saying, I do SEO for e-commerce. And once you're starting to get revenue traction, you have happy customers and you're driving results and you got the processes and the frameworks down where your team is performing well, it's not about the revenue numbers, it's about how well they're performing. And do you have it, do they have it down where you don't worry if they get another customer? Do you need to be in there doing the work yourself because your team can't perform? But assuming They got it locked down, then you can start introducing new services. Not all of them at the same time, one at a time instead.

Right, right. Okay.

Makes sense.

All right, Mario, you're up.

Yeah, I was actually building upon what Allian asked and some of the other guys and gals here. Essentially, you know, there's that common adage that you need to offer one thing and that's kind of how you sell, you know, your niche, you specialize and all that stuff. But then again, you know, you go to 7 and 8 and 9 figures with a broad portfolio instead. So like in our case, we have retainers spanning from $3,000 a month to $30,000 a month. And you know, they're already higher ticket than, you know, some folks that sell link building or some cheaper services. So the question is, especially now in that slower economy, does it make any sense whatsoever to start with a low ticket service so that you can lure the clients in and then you start working with the account managers to upsell? Because as you said, it's more about upselling and cross-selling. cross-selling and less about landing new clients. So this makes sense, introducing a cheaper service just to lure in more clients and then onboard them on the more expensive services, or would that distract that with low ticket?

No, no, no, that is actually the right approach. So we try to work mainly with enterprise companies. We'll take accounts that only pay us $2,000 a month, enterprise, no joke. We have an account with a $90+ billion company, not million, billion at $2,000 a month. The reason we take that on is if you can produce results, you can land and expand to multiple regions, service offerings, et cetera. But the key here is the client has to be the right type of client. If you're working with the SMB, let's say a plumbing company in a localized region, and they can only afford $2,000, it's hard to upsell them and cross-sell them when they don't have a budget because they're only making $300,000 a year in revenue. So they can't spend more than, call it, $20 grand or $24 grand a year with you. The point I'm getting at is the land and expand is the way actually most agencies grow, but you have to make sure you're getting the right type of accounts. If you're already taking up 10% of someone's revenue in marketing fees, but it's very little that they're paying you, you're not going to land and expand much at all.

Plus they're a pain in the ass, right?

But it's okay to start at $2 grand a month and then move to $50K, right? I mean, since they're already an enterprise and stuff, it's not a 2, 2 people.

We're a 9-figure agency and I still will take on accounts at $2,000 a month if I know they're the right fit and I can get them to millions of dollars a year. I don't want to, but I will.

I got to take a minute to tell you about the Agency Owners Association. This is a peer group for agency owners. Think YPO or EO, but for agency owners. And I just wanted to read you a couple of testimonials. So this first one comes from Carrie, and we asked her, what do you like most about the group? She said, having a group of people to discuss and bounce ideas. The leads are great too. Yes, we share leads in this group as well. This one from Aliyan, he says, the ability to really post whatever I want and need, and the group responds. Great experienced members. Getting a lot of insights from conversations with other members. Getting a lot of value from sessions from Eric. Getting advice from others as well. And so if you want to grow your agency faster and you want a peer group to do so, just go to marketingschool.io/agency. This is a group that both Neil and I created. And our hope here is to create a vibrant community of agency owners and do a lot more with it in the future. So again, marketingschool.io/agency, and we'll see you inside. We're open for questions now. So if you got something, you can unmute and just ask.

Well, I actually have a following question just for the previous one, because you're starting a lower rate for the initial services.

No, no, no.

Are they going to accept higher? Not a lower rate for the initial services. You're charging whatever you would charge for the work to be done and maintaining your profit margins. So if you're normally charged $5,000 for X, Y, and Z work, but they want to pay $3,000, maybe you can do it for X and Y and you leave out Z. And they know that, right? Because you still want to maintain your margins and be respectful of your business. You don't want to give away X, Y, and Z that you normally charge $5,000 for $3,000 because you're going to crush your margins. Or if you maintain your margins, you're not going to do a good job because they're not paying you enough, which means they're not going to be happy and they're going to churn anyways. I just want to clarify that really quickly. Sorry for interrupting you. Thank you so much.

Just to add something real quick before you go, Matt. So Amber, this might help with your last question or 2 questions before, but Neil was mentioning, so we've talked about this on the podcast, but Neil's personal brand basically capped out for him at $10 million in annual revenue. And, you know, it's interesting because our mutual friend Alex Hormozi, he made a video recently talking about how he went too wide with his content and it was just getting a lot of like random people and it wasn't helpful talking about diet, talking about relationships and things like that. He made it go back to business. And even I texted him last week. I was like, dude, I actually watch your stuff again, right? And I'm sure Neil, what you start watching his stuff again because before he went too wide and now it's like it's focused again. So I think if we were to start from scratch today, it would be very focused content. Neil does a better job of that than I do. He just focuses on talking about marketing the whole time. Literally all his content is just marketing, right? So hopefully that helps a little bit, Amber, because even, even Alex, who I think is one of the top creators at the moment, at least in business, has like really focused in. But Matt, go ahead.

Yeah, so I'm going to change topics a little bit. Neil, earlier in the call, you made a comment about a business that said they had grown 5% over 5 or 6 years, and that's not even keeping up with inflation. We had to increase our rates last year due to inflation, and we had a couple of clients who didn't increase their budgets. We increased our rates, they didn't increase their budget. So I'm wondering, now we're getting them to finally increase their budgets 6 months later because we had decreased the number of hours that we're working, right? I'm wondering if you have any tips on how to manage that when we're seeing these inflations going up so quickly, right? How do you keep raising your rates, right?

There's no way to manage that easily. You more so have to just have straightforward conversations with people and just being like, hey, I know we're coming up for renewal. This is what we can do. And instead of saying we need to raise rates due to inflation, you talk about what else you can offer them. And pitch that. And if they say, oh, I just want to renew at the same, be like, look, we can do that, but we'll have to offer X, Y, and Z less because of inflation and costs are continually rising, which it sucks and I don't want to, but I don't have a choice. And if I don't, then I'm not going to really be able to provide you the service that you need and you're not going to be happy and you're not going to get the results. I'd rather just be transparent with you. And you'll find that a lot of people will be okay with that and they'll be happy that you're transparent as long as you're not gouging them, right? Inflation didn't go up 10% in a year where you need to increase their pricing. 10% or reduce the hours by 10%. But as long as it's realistic, people shouldn't have an issue.

Yeah, thank you.

Well, thanks, Matt. Scott, go for it.

Yeah, follow-up question to internationalization, I guess. So fascinating topic, but it kind of makes sense in the agency sense is that the way you do it is you go into the region, you acquire an agency there, maybe it's smaller, but it serves the local market. So your expenses are by local standards are You know, the way they're supposed to. But if we were to look at our clients, mostly we work with SaaS, they obviously focus a lot on North America, but then they get a ton of opportunities outside of North America, like in India, for example, a ton of traffic. What do you see from your clients in terms of going international? I know this is not so much agency, but when they go international, they can't bring their talent over there and serve the software for cheaper-ish. How do they approach the problem of going into growing GDP markets?

Yeah, so a lot of them will either A, maintain the similar pricing, or B, they'll come up with a different variation of a plan. The reason it has to be different is because they can't offer the same exact thing for a cheaper price. You have to remember software has high margins. You build the software once, you can keep selling it and the cost isn't that high. So a lot of clients will take out a few features but drastically reduce the price for other localized regions, and we've found that to be a very effective approach. You know, look at Netflix's pricing globally. It'll give you ideas of how to really price in some of those regions.

Okay, so less features, less price, just— okay, got it.

Yeah.

And you got to adapt the currency to their local currency. Most of these players like Adyen, Stripe, etc., will accept multiple currencies. That really helps increase the conversions as well.

Yeah, that's what started to come up in conversations, regional pricing. Like charging in USD, even if you charge lower, the conversion rates are still there. So you have to go and offer them something in their rate. Okay, makes sense.

Yep.

Dalian.

My point is, if you're starting from scratch now, at what growth rate per year do you think that you can run a marketing agency? I just want to know that number and And see where I'm not good at?

I don't have a real number for you.

I think it's tough. It's so pie in the sky.

And also in this economy, you're not going to grow as much. It's just a terrible economy for agencies. I'm just telling you guys the truth versus telling you guys can grow at 50% a year. If you're starting from scratch, sure, you'll grow. But, and if you're starting from $10,000 a year, sure, you'll grow and you can grow by leaps and bounds. It, but it is a tough economy right now to maintain customers, to get new customers. Just the economy globally is terrible.

I want to take a second to tell you about my podcast co-host's agency. So NP Digital, so Neil Patel Digital. What they do is they do a whole host of marketing services and they are global. They're worldwide. They have SMB services as well. They have mid-market to enterprise services as well. They cover the entire gamut. So you can just go to mpdigital.com to learn more about it. And now back to the episode.

Wait, wait, wait, wait, wait.

Quick show of hands real quick. Raise your hand if you think the economy is good right now. Brian, David, Nathan. Okay, David, you haven't spoken. So David, why do you think it's a good economy right now?

I can only speak to what's going on on my end where things really slowed down. And then now, like at least in B2B SaaS, people are starting to spend again.

And maybe it's just by nature of like this segment that we're going after where they didn't raise at ridiculous valuations and now cutting back.

So I might have a pretty small slice of the view. And I do agree with you in certain sectors and industries, it's booming. Like if I was an agency in India and just focused on the local India market, I would be like, the economy's great. It really depends on the industry you're in and who you're selling to. But B2B SaaS has been pretty resilient, especially enterprise. Especially the ones with low churn in a good economy, bad economy. Sure, their valuations may have gone down, but they still have paying customers and they're still, you know, growing, especially the ones with net negative churn. You know, they're making more money even if they don't get new customers.

Well, also the B2B software recession was 2022, so they've kind of started to happen, like a recovery started to happen like last year. Kush, you're going to be the final question because we're 4 minutes over over here. We just want to give you a little more value, but Kush, go ahead.

Excellent. Super. So I wanted to know if there's an offline brand that doesn't have a website or anything, they have a physical store, it might be a premium brand. What kind of marketing strategy, digital strategies would you implement for them? Because it's hard to measure whether the conversion is happening through your efforts or not. You can show engagement, but how do you actually in the end show that the final walk-in happened because of you?

Have a store locator page and then also do Google My Business and all the local listings, but have a store locator page on the website and you can show how many people are actually going to that. And you can also start showing stats and data on how many people are searching for their business and addresses and stuff like that. And you can attribute a lot of that to digital marketing.

So I'll add a little more context to yours. So there are jewelry brands, very big jewelry brands in India, These are not necessarily the brands that have websites of their own while they have the budgets to make them, but their target audience is a lot of people who don't really actively use digital platforms that easily, right? So they might, they might have just started adopting a lot of Instagram and Facebook, but they're not the people who click on a link, go onto a website, go onto a store locator page.

Yeah.

And what do you do in such situations?

What you have to do is you just have to do brand recall studies. Hey, how'd you learn about us? Where'd you find out about us? Where'd you first see us? And I would really emphasize social media and show them the engagement, the likes, the followers, all that kind of stuff. Because you're like, look, your brand's getting out there for more and more people as well. And then also do brand recall studies. Hey, have you followed us on social media? Have you even— even if they say, oh, I didn't come in because I saw something on Instagram, you can ask them, do you follow us on Instagram? Do you see our stuff? It all gives them signals that, hey, the marketing is working. You're staying top of mind. I can know about a store, but I could forget about that jewelry store. And then when I want to buy a piece of jewelry, I will probably pick whatever's top of mind, right? That's how a lot of people are with their purchasing decisions.

Cool.

So for 2 things before we go here. So one, let me just wrap up the economy thing. So one thing is, at least in the United States, we lost 685,000 jobs in May. Inflation's still sticky. The yield curve is still inverted, right? And then you have this banking crisis that has been sitting for a while. Commercial real estate's another one, right? And then for at least for Neil and I, I think we get to see, you know, our lead flow and then we get to see customers that are churning too. So you look at your own business too and then you also talk to other people too, right? So I think the main thing is you get your own information, you have to learn to think for yourself, and then you jump to your own conclusions. The final thing is Ezra's going to send you all a survey for this one. So we're looking forward to doing more of these in the future, bringing in guest speakers as well. And we want to continue to improve the product here. But thank you all for your time. Hope you enjoyed this and have a good rest of your week.