How to beat feast or famine
Feast or famine is experienced often by the hard working agency owner. How can we can we change this model and create a business based on recurring income whilst providing the same services? This is not a podcast about selling support packages but instead creating a business based on your expertise, and creating real value for your clients.
Connect with Rachel
Lee Jackson: Welcome to a conversation with me, Mr. Lee Jackson and today we have all the way from e-commercepartnerships.com land it’s Rachel Jacobs. How are you?
Rachel Jacobs: Hi Lee, how are you?
Lee Jackson: I am tip top and champion just to try and do the local lingo. Is that right? Tip top champion.
Rachel Jacobs: In Ireland?
Lee Jackson: Yeah. I don’t know. I’m just probably being casually racist. I’m not sure.
Rachel Jacobs: Not sure casually. You didn’t say anything about potatoes. So so far so good.
Lee Jackson: That’s true. So no one will know but I was going potato on our last conversation.
Rachel Jacobs: Yeah that was basically the introduction to our first call, so that was good.
Lee Jackson: I did explain that this is the most unprofessional professional podcast that anybody will ever listen to and thankfully Rachel still agreed to come on. But Rachel, for those who don’t know who you are, and obviously we’ve had a few chats and we are getting on really, really well. Can you just let people know a little bit about yourself. So that’s where you’re from, maybe a favourite colour, maybe what you like to drink or where you like to travel in the world. Just a few cool random things and then we’re going to jump in the time machine.
Rachel Jacobs: Okay. A few random stuff. Irish obviously goes without saying. Live in Dublin, favourite colour we’ve already established is purple. Specifically #440099 for those who really love the hex codes. That’s my favourite purple. Favourite numbers is three. Fun fact, I have a second and black belt in Judo.
Lee Jackson: Oh wow. I’m going to tone down the banter a little bit now.
Rachel Jacobs: No, no it’s grand because we’re in different locations. But if it was face to face, then I start getting twitchy, then it’s time to run.
Lee Jackson: Yeah. You’ll be like, do you want me to make your face #440099 huh? Exactly. No, it’s wonderful to meet you and folks, if you don’t know how we met, we met via Twitter of all places. So social media really does work. If you are not investing time in social media, can I recommend it because I don’t think us two would have ever gotten together and been able to have so many laughs already if it was not just for the fact where we’re tweeting and Rachel reached out to me and we’ve had some great conversations since, so the power of social media. Now Rachel, the way we work on this podcast is we like to jump in a time machine so that can be a Tardis. It can be whatever contraption you prefer, but I would really love to know how you started back in the day in agency life in general. How did you get into this industry?
Rachel Jacobs: Well, probably like most people by accident I kind of accidentally fell head, shoulders, knees and toes into agency worlds on my background actually originally going back about 10 plus years, 10 12 + years. It was in marketing specifically, so marketing but content and partnerships. That was always my area of expertise and then as time went on, it sort of as more on the sort of the strategic side of marketing. Then back then over a decade ago, it was relationship marketing and now it’s a bit sexier and it’s partnerships. So I did that for years, but not specifically in e-commerce. My big break, if you will, I again fell into a startup by accident and it was a very successful startup. We went from zero to 40,000 users in six months as a whole Silicone Valley bubble. You know, it was just all false and you’re surrounded by unicorns and everybody’s talking about money and I’m sitting in the corner eating spuds in a farmer’s outfit. So it was completely like, it really wasn’t my reality, but it’s super exciting cause I’m a simple farm girl and this whole world for me was just like, Oh my God, it was mind blowing. It was then I realised that, you know, if you really would, you know, being online and you know, working with people on the other side of the world, you can get it if you want it. Then I went into consulting. I fell into the blockchain world, again by accident because I knew someone, but it was more on the growth marketing site of launching blockchain technology. I was working with a couple of block chain technologies across Eastern Europe who are amazing at dev, but not really known for their more creative marketing sites. So that’s where I came in to help them with their messaging and their positioning and how they were targeting their ideal customer, figuring out who their ideal customer is. Then fast forward another couple of years, I then fed into e-commerce but I was on the SAAS side of e-commerce. So content and partnerships, building out agency partnerships, doing strategic partnerships with the likes of Magento, Shopify, Wix, big commerce people like that. Then working closely with agency partners for them to implement the technology solution. It was at that stage then I was working on it on a contract basis and doing contract work cause it’s allowed me to kind of, you know, I’ve got a big appetite for food and also a business and, and learning stuff. So I was able to work with a couple of different clients, one of which was an agency, Shopify plus agency in London. Again, we just, we just clicked. We were just very novelty and we have loads and loads of fun and we just have very similar mindsets. You want to have fun while they’re working but you want to do well. So that’s basically how I fell into an agency, it was after some long nights at an event and a long night out and the next morning you are just like: Did I just agree to be COO of another company? Then the awkward conversation with my husband, you know how I said I would never do that again. Yeah, just did it again. I think I just signed another contract. So, but anyway, it was an amazing decision. I joined an agency and it was moving so quickly. Like most agencies like there, it’s very, very fast paced and when you scale too quickly or scale quickly in general, they’re loads of holes in your processes and your systems on just being able to scale profitably. Another fun fact about me previously, previously before the marketing stuff, I did a small stint, about 18 months in the military. So even though I liked to be a wild horse, you know, and my husband calls me a pirate even though that is a big part of my personality structure and organisation and processes and systems are so in my mind it’s crucial. So I came into an agency where it was a typical Shopify agency run by a creative, loads of ideas, loads of creativity, but perhaps doesn’t lend itself very well to implementation structure, which is really common for a lot of creative agencies. I was almost on the other end, you know, I was just like, okay, what’s the profitability? What’s, what’s the margins, what’s the rate like, where’s the structure? Like where’s your process documentation. They were just like, sorry what?
Lee Jackson: As a creative as well, I can actually feel the stress as you ask those questions.
Rachel Jacobs: Exactly.
Lee Jackson: I can feel my own heckles or whatever they are rising. As we had someone come in years and years ago in our old agency and us three directors were all super creatives and then they started saying what was your processes? What was the ROI on that? We’re just like, we have no idea what you’re talking about.
Rachel Jacobs: Yeah, super common. For me it was just like I’d come from a startup world where I was COO of a very fast paced startup and my responsibility was effectively everything. So I was managing the budgets and the partnerships and the content and the marketing and the dev team and the operations and scaling a team myself and training them. It was, it was mad but it was like a Baptist and a fire. So then to come into the agency world, which is as fast paced, if not probably faster because I mean there’s just so many people .You’re competing with so many other people and to not have those systems in place, I was just like, Oh shit, I mean, how do you, how do you, how do you measure success? You cut management, you don’t measure, how can I manage something if we’re not measuring it? But that’s very typical for a Shopify agency specifically when your design and builds. Of course, my background is marketing and marketing is all about being able to measure how effective your marketing efforts are. So like any other agency projects that every project’s scope creep, you know, was an absolute killer. You know, in some cases, like for a lot of agencies, you’re losing money hand over fist. So implementing a system and documentation a process, which meant that you were, anytime you were out of scope, the client, it already approved beforehand, but you could charge them. Then moving up the ladder a little bit and looking at the acquisition and making sure that we’re bringing on projects, you know, if, if, if you’ve ever, which I’m sure you have, you have an agency, if you’ve ever brought in a couple of projects with like evil, evil clients who it’s just seems like their only job in life is to make your life miserable. If you’ve had a couple of those back to back, you just like, Oh my God, I need to make sure that it never happens again.
Lee Jackson: I was going to say, I’ve nearly given up on my agency in those situations.
Rachel Jacobs: Yeah, I’ve experienced a couple of really, really nasty, nasty, clearly very unhappy people, very nasty clients. I mean an agency is a very emotional thing. It’s passionate and you have to be passionate about it in order to, you know, get through the day sometimes. So when you have a couple of those clients who are just kicking you in the ass, it’s, it is very, very tough. So we had a couple of those and I don’t have, it’s just like, Oh my God, it’s not only the profitability but dealing with assholes like that. So how do you put a sort of an acquisition process, automate some sort of qualification of clients and what does the sales back look like and who are you going after and how are you targeting those people? Then moving further up the ladder then and looking at positioning and messaging. You know, what, what is our messaging say about us? So I did those three and I thought, okay, yeah, I know, I know this is brilliant. It’s working pretty well. Then we were an agency that specialised in subscriptions and then I suddenly thought to myself, I was like, hang on a sec. We have an agency here that we’re working with subscription model, but we’re a project-based agency. We don’t have any sort of subscription level ourselves. So that’s when I started charting with the idea of retention.
Lee Jackson: Oh, so wait a minute. So you are, you are supporting the subscriptions of your clients you mean? But you were not taking them on yourself. So you are project to project and the client doing the monthly subscription model.
Rachel Jacobs: 100% percent. You’re working with brands who, I remember working with one brand who was like, I think within six months they were doing 250K on subscription and they were, they were like $10-$15 a pop and within six months. Then I just kinda thought to myself like this is a bit shit. I mean we’re going from project to project, but we’re not actually, that MRR is not there. It’s like, you know, it’s really kind of demotivating when you’re like chasing a project to close it and as soon as you close it, like, okay onto next one. Right, okay. The next one. You don’t really get a chance to get your head above water. But like, okay, let’s, you know, take the win. Let’s all celebrate, let’s party, let’s really enjoy this. It’s literally like, okay, onto the next one, onto the next one because it’s famine or feast and that’s how, I mean, your agency is your team and that’s how you run your team. I just spoke to an agency this morning and very successful agency and they’ve had an amazing, amazing, amazing year in terms of profitability, but they’re now going into November and he said his entire team are so burnt out that he gave them all a week off and he’s now considering whether he should give him the rest of the year off and not do any more projects. He’s so worried that he’s worked committed to growing so much for these huge projects. It could kill the agency. It’s a real thing. So that’s when I started flirting with the idea of retention and of course this was a design and build agency. My bread and butter is marketing. So there’s obviously that disconnect and you know, the sexy stuff happens post launch. It’s not like the building and designing a website is brand, but I mean cash in the bank, actual tangible, you know, where you can say there’s a direct ROI here is post launch. So how I was able to convince the agency owner this was a good idea at first. That was the biggest challenge and then on top of being a COO and scaling a team on dealing with clients and dealing with proposals and dealing with sales and also heading up partnerships. Then putting time, evenings and weekends to build out, walked a sort of value-based or not time materials, value-based, 12 months, a data-driven retainer to like very proactive retainers. So instead of clients saying, how would you fix that CTA or would you put, you have a look at my shopping carts or there’s a bug here. It was like, this is what we’re doing with you every single month. This is how we’re measuring it. This is the deliverables that we’re looking to achieve, these the KPIs that you’re going to be measuring us against. So it took me like three months to kind of do the convincing build that model and then fine tune it to men, train the team internally, then sit down with all the clients that we have that were all had talk. I was like really sick and tired. So this was kind of pre black Friday, cyber Monday, and a lot of the merchants were coming to us and saying, I know it’s like four days away, but can you do give me 72,000 hours of work in these four days? Then 10 of them did it and you’re just like: sorry, why didn’t you tell me this six weeks ago? Oh, I didn’t know I needed it. And then you’re like, well I couldn’t possibly deliver that night because we’re doing projects and then you lose the client. That was all going on at the same time, so I went and I met all the clients just after BSCN and then I said to them look no more adhoc this is what it is, very aggressive approach. Very much like my personality, you know this, this is what this is what if you’re going to continue working with us, this is what it looks like. This is what your 12 months roadmap looks like. This is what the process is going to look like. You’re either in or your out, your either for me or against me. Of course there was a couple of clients who went, Oh shit, this is bit a too much commitment, but the other kinds actually took to it pretty well. So, you know, you close then 10 15 clients on a retainer within, within a quarter, we had boosted the agency MRR by just over 500%. It just completely changed the agency to know that you’ve got more than two, three times your monthly overheads in the bank within the first five days of the month and you haven’t done anything. You literally haven’t even lifted a finger and you have that cash in the bank. You’re not chasing projects, you’re not trying to cover cashflow, you’re not trying to like move money around so you can then pay invoices and, and get salaries out and just completely change the entire mindset. So of course, at that stage, then I realised I had a bit of a business model. So it was really time for me to think, okay, I can do this with this agency. What’s next? That’s when e-commerce partnerships was born.
Lee Jackson: So, let me just understand this a little bit in my feeble brain, I am hearing that you were in an agency that was essentially feast and famine and you’re highlighting how demoralising it can be that you are mid projects, but you know you’ve got no money in the bank or not much money in the bank and you’ve still got to put all this work out to get that project finished to get that money in. It’s not fun at all and yet you were able to switch from that model, retain most of your customers and get them over to a retainer model where at the beginning of every month you already knew you had your operating costs in the bank so you didn’t have to stress and freak out. You could just simply carry on looking after your clients, giving them your best and presumably also finding new clients as well. To add to that, is that a good summation of what you were saying?
Rachel Jacobs: Yeah, and I think more importantly as well, because cash in the bank of course is critical. But the more I work with agencies now you realise once she gets the agencies I work with getting cash in the bank, building a retainer model, getting cashflow and is, I know this makes me sound like an arsehole, but whatever. It’s not that difficult. What I find is beyond that is it’s about the team. It’s about how the team fits into that. So one of my agency clients that I worked with within six weeks of working together, they had, it was just over 300K over a 12 months period because they signed three or four contracts in six weeks, 300 K on retainer for the year. But then what I realised the team we’re completely out of the loop, so not only by building a retainer model are you covering overheads, you have predictability with your team. There’s nothing worse than, especially for developers because they’re sort of very single focused. There’s nothing worse than them having to bounce around from month one, project, one client, one website to another. Whereas if you have, this is what the next quarter looks like, this is what the tasks look like. This is what you’re working towards. This is an iterative approach to the work you did last month you are now following on from that. It’s so much better for the team. It’s so much better for morale, just about predictability and of tasks of work. If you’ve done something for one client who for example, this is description clients, then you can take that, maybe it took you 10 hours and you can do it with your next subscription times. It only takes you five hours. So your profitability is just growing. So it’s bigger than just cash in the bank. Clearly, I’m very excited about retention modesl.
Lee Jackson: So I’m now intrigued at this point. So I’m looking and I have many clients who are that kind of project to project setup. They will have the brief of a website, Hey, can you build us this website? There might be, say a 20 or 30K budget. I am one of the partners that the agency will go to for the build. So I’ll be getting this small building element, but how can that agency who’s got this 20K-30K website project convert that project into something that’s a retainer model as opposed to just simply exchanging time for money, here’s 20 K build me a website, which is what agency owners are just so used to doing and don’t know any other way of doing it.
Rachel Jacobs: Absolutely. I mean, I think that comes down to your sales process. I mean, if a brand is coming to you and they say, okay, I’ve got 20 K to drop on a website, I want to redesign. Really the onus is on you as an agency to really figure out why are you looking for a redesign? Oh, is it because you haven’t done one for two years or, I mean, what’s the reason. What agency owners, what people here in sales should be doing is they always, somebody comes to them with the size of a project and somebody coming to you for a bit a theme, customization, that’s couple of grand. It’s a completely different kettle of fish. They should, they should be on a retainer if they’re looking for that kind of work but that’s another topic. But a project type of work, what they, what they should be doing is getting access to the analytics and saying, okay, so why you actually looking for a redesign of the website? The reason is that your conversion rates have dropped or let’s just say for example your traffic is compressed but the conversions are low or your, your mobile traffic is overtaking the desktop traffic and your conversions are, they’re not comparable or maybe it’s a case of their email marketing is not driving as much as the revenue. So really the onus is on the agency and that’s why agencies close deals by rather than saying, okay, what are your requirements? Oh yeah, I would like a slideshow here and I want this kind of, you know, product page and I want this style of shopping cart and I want some CTA buttons that are sticky and I want it mobile optimised. Okay, that’s like surface level. But really what you’d need to be doing with a brand or what an agency should be doing is sort of getting under the hood and indirectly what you’re doing is you’re showing the potential customer how much value you’re bringing and how much knowledge you have. So you say, okay, you’ve got a 20K project for a website redesign of how to look at your data. What I’m able to see from your data industry average for email marketing is around 20% of your profits and right now you’re at 3% so if you were able to get your 3% up to 25% and by the way, here’s a case study of five clients I’ve done that for, and they actually hit over 40% on average. But if you’re able to move from 3% to 25% did you know that that’s an extra 250 or 400 grand a year? As soon as you start talking Turkey, that’s when brands really listen. It’s like so is it worth you spending 20 grand on a redesign or is it worth looking at where your immediate low hanging fruit is and that’s really immediate low hanging fruit and to make it even more sexy if you’re an agency and you can do that, if you can pick out, you know there’s only about five different key metrics where the no hangings return, it’s not that complicated. If you can really pick those out and whether it’s the bounce rate or the conversion rates or their email marketing or their PPC for example, and you can pinpoint those and say, okay, email, you know if you’ve got this industry averages, it’s 400 grand. If you’ve got your conversion rates industry average and it’s another 200 and then this one is an extra two, you’re actually leaving over a million dollars on the table right now. So do you want to spend 20 grand on a face lift of your website or do you want to fix your million dollar problem? Of course the brand is going to be like, I would like an extra million dollars please.
Lee Jackson: I’ve just had a vision of you mic dropping at that point by the way.
Rachel Jacobs: Just walk out of the room, call me. Find me on Twitter works for everyone else. So it’s basically what you’re doing is you’re moving from being a servant to the brand to being 100% in the driver’s seat, being proactive and being the advisor that a brand is looking for as opposed to yeah, we can do that. Then taking the 20 can say rather than doing a 20K redesign, what I think we should do is, I think we should split this slide over four months or five months 4 grand around a month. What we’ll do is we’ll take an iterative data-driven approach to boosting your bottom line, to boosting your profits. We’re going to start off with where your key growth opportunities. So month one maybe email, month two maybe CRO because of conversion rates. Of course there’s going to be a bit of a redesign. If you’ve got a client locked in on a five, let’s say five months, you’ve got them at 4K a month, you’re still getting your, your 20 K but you’ve got five months to really dazzle them. Not only that, you’ve got five months to say these are your KPIs, these are the metrics. This is how you’re measuring our success. Five months later we’ve actually made you, 90 grand out of the 20K you’ve invested, it’s a no brainer for them to say, okay, my target is a million and you’ve already made me 90 what do we need to do to get to the million? So that’s it’s a shift in mindset. Also I think it’s important to know, which we discussed before this podcast, is that value based. If you’re looking at there, I can make you a million. You’re not then saying, Oh I’m going to give you 20 hours a week or I’m going to give you 20 hours a month. What you’re saying is your Northstar is a million and over the space of a year, I want earn 10% of that. So if I can make you, I’ve projected revenues, I can make you a million and I want a 100K over 12 months or I won’t 10 grand a month. One of my clients, small agency if five people and they said exactly as we worked on exactly this model. Exactly what I’m explaining a client that they need before spoke to them and within two hours of re-engaging with the brand they landed a 25K a month retainer. For an agency of five this is like, it’s a game changer.
Lee Jackson: Well, yeah, I mean for an agency of five 25 grand covers all of your salary costs for a start off.
Rachel Jacobs: More than covers and within six weeks they did this like two or three, no, three or four brands. They have now over 40, $45,000 on retainer a month. So it is doable but I think it’s just, again, it’s going back to that having a system, being prepared to change the mindset and get out of that project first approach.
Lee Jackson: I’m just a little bit gob smacked because I’m just thinking of the time and time again when people have approached agencies and my own agency as well. I run an agency for many, many years and we would be approached for a website and we had simply made the assumption that they were at that point where they needed a website. And something I’m always telling people is to ask questions because it’s an old example I gave years ago, but, um, I think I’ve done this example on the podcast multiple times, but it’s a good one. I was once asked when I was the it manager that, um, could we please instal a brand new email server? This is one of the MDs of the company. So I was asking, well, why do we need an email server? Because they’re really expensive. That’s gonna cost several thousands of pounds, new servers, new technology.
Lee Jackson: We’re going to set the new domain, all that sort of stuff. And it turned out all they really needed was to just have a group email that they could send an email that would go to multiple people within the department. And I was like, make you Dave, I need an email service for that. Our existing platform already does it. We didn’t do it for you, et cetera. It’s of not related. But the important thing here is that you’re asking questions and you’re setting yourself up as the expert and we’re actually saying you don’t need this website right now. What you need to do is fix all of these problems before you even know website. Because actually your crappy looking website is probably not generating income for you because all of these other elements before people even get that far are broken and that’s a completely different message to sure we can do that website. Oh well the other guys are charging us 20 grand. So you know, if you can come in about that and that’ll be great. That’s a soul destroying conversation as well, isn’t it?
Rachel Jacobs: A race to the bottom, a complete race to the bottom, and ultimately I think that this, again, slightly different topic, but you know, it’s crucial for agencies. I think that’s why for agencies to try to be all things for all people, they’ll always, you know, they’ll not that all of us fail. They’ll definitely struggle much more. Ultimately, the more that you can niche down and become an expert in whatever that key pain points are. Let’s just use the analogy I used before of a subscription model business. The more that you immerse yourself in that world, you know, you can already anticipate. Every time a prospect comes to you, you use a subscription model business. You can already anticipate what their pain points are going to be. So they might come to you and say, yeah, I want you to tweak this elements of the subscription solution I’m using Shopify world recharges is the best. So let’s just say I need this recharge as it’s this new feature on, you know, I, I want you to implement it, but ultimately you should know as the expert in this area, what I, these pain points. I know you want me to to implement this, but what about these three or four pain points? In some cases because it’s like you read my mind and what you’re doing is then from, from the get go, you’re positioning yourself as this grounded action. You’re like, these guys are safe pair of hands. I’m kind of like that. You know, you’re position yourself to be like Sherlock Holmes and Dr. Watson. The brand is Sherlock Holmes, they’re the superstar, they’re the superhero. But you’re Dr. Watson. He’s in the background and keeping things ticking over. But the more you niche down, the more you empire your agency to be, be go to experts and then really understand not only the pain points but what the likely solutions are.
Lee Jackson: So one of the common methods for an agency would be to do a discovery session and a lot of the times that would also be a paid discovery session. So because they’re giving the value of their expertise about the platform that needs to be built. I think, and correct me if I’m wrong, that what you’re saying is potentially you’re doing a free discovery session at this point where you’re actually getting under the hood of how their business works. You are not actually talking about the thing they’ve come to you for you to build. You’re actually saying, well before we talk about that, let’s look at the data. Let’s look at this, this and this, and then we can then present back to you. Is that what you’re saying? So this would be free consultancy or?
Rachel Jacobs: No, I wouldn’t say free consultancy. I wouldn’t say a free discovery session cause that is very naughty even for someone like me. I would say a very, very high level again, this depends on how you can niche down, you should be able to template this. But again, if you’re an experts in, you know that there’s three or four pain points. So when you’re on your initial, as long as the, as long as the lead is qualified before they get on the call, there’s no point wasting time on calls with people who haven’t qualified what their requirements are, what their budget is, what’s their timeline. Once they’re qualified, you basically turn your initial discovery call, first call that you have with a prospect into a mini sort of audit in that session. So any proper discovery on the back of it, absolutely 100% should be paid because that’s your expertise. You know the expression that says, why buy the the cow when you can get the milk for free. Like of course you should be charging for it. Any sort of documentation any time that’s going in. But the general sort of high level stuff, you know, whether it’s your, you know, your email marketing, your conversion rates, you can even, in some cases, some of my agency clients, they actually go on do screen shares because some brands are like, I’m not going to give you my analytics. Okay, fine. Let’s do a screen share. Click here, click here. What does that look like? Oh, I can see your conversion rate is 1.7 did you know the industry average is 2.8 or 3.4 whatever? No, I had no idea. I’ve been too busy in my business at trying to sell products, so I have no idea.
Lee Jackson: So that mini audit is essentially the final structure you’re going to use on your initial call to prequalify. You’ve already got this pre-qualified lead, but you then want to take them through this templated mini audit to find out, do we have access to all of the following information that’s going to help me help them.
Rachel Jacobs: Help me close a deal.
Lee Jackson: Helping them in closing the deal as well.
Rachel Jacobs: Absolutely. It’s like you want to go through this whole, and they’re going to speak to like three or four or five other agencies. You want to be different. So you’re coming out from the gate saying, did you know that it should be this and did you know this is where you’re leaving money on the table? Yes, I can absolutely help you with your shopping cart, customization functionality. However, that’s not going to move the needle right now, but this is. We’re experts and we do this, but if you want to work with me, you’re going to work my way. That’s a minimum of three months retainers. So I can show you what I can do that state for a while and see if something more serious is an option.
Lee Jackson: Rachel, you are really cool. I’m enjoying this.
Rachel Jacobs: I really enjoyed the agency world, but I just think of some tough but now for me it’s like being on the other side of it, working with like seven or eight agencies right now in different eCommerce platforms. So whether it’s Magento, big commerce, Shopify, they’re the main ones. Some clients in Australia, which is really interesting at the time zones, clients in America, but most UK in Europe on the, the funny thing is it’s the same shit different day. The bigger the agency, the bigger the problem and I’m working with agencies, one of my clients is like the number one shop, five cross agency in the Netherlands. They’re an amazing, amazing agency, but sometimes with agencies they scale so quickly and they do amazing work and then you kind of bypass the implementation of the structure that makes an agency not only build the revenue but boost profitability because most of the agencies I was with workshop with an agency yesterday and they said that they grew really quickly and they have more money in the bank, but their profit margins were just going down and dying and dying. That’s a really common thing and if that is happening for an agency that’s 100%, your systems aren’t right, your processes aren’t in place. It’s not being streamlined. You just, you’re working too fast and sometimes you need to, so it write down and think, okay, what sort of structure, where are we, where are the gaps, where we haemorrhaging money? So it’s, it’s really fun being on the other side of it because it’s just some agencies, obviously I was at a plus agency and I’d have to see other agencies, these guys are big dogs and know we’re small fry in comparison. Then now I am speaking to these agencies. In one of the cases they were one of my clients and I’m just like, I just wish, I wish when I was, when I was running that agency, I wish I knew then what I know now. I wish I just wasn’t so paranoid when it comes to how am I matching up in terms of my pricing? What does my sales deck look like? What does my proposals look like in comparison to other agencies? Why are they winning projects over me? Like what am I not doing that they are doing? They look like they’re super busy. Why is it like complete famine right now for us and you speak to other agency, Jesus, yeah, I’m swarming in leads and you’re just like right okay it’s like crickets over here so what am I doing wrong? So now to work with agencies and have all these questions and for me to be able to say, actually I’m working with a handful of agencies and I can tell you everybody’s going through the same thing or your pricing is way too cheap, or your proposal processes absolutely crap. Or your sales deck in most cases, which is nonexistent, is useless, but this is what we need to do to fix it, so here’s a template, let’s work on it together.
Lee Jackson: What you described as well was those many years ago where we grew really, really fast, so we had plenty of cash in the bank, but we also had lots of employees to cover all of the extra work that we’d taken on and then we had the recession. It was 2008-2009, I think 2007 that was a real tough time in our industry and we were like, Holy crap, what do we do now? Clients that all decided they don’t, you know what? We don’t need to invest in creative. We’ll just use our creative from last year or whatever. So budgets were cut, stable clients went bust. It was a nightmare and we had all this team and all this money that we’ve accumulated was just rapidly disappearing. I’m paying people to sit there at their desks waiting for the next big project that we were scrambling around to find. That was a real tough time as well.
Rachel Jacobs: Which is why retention takes care of all that because you have, if you’re getting, I mean, like I said, it’s a bit of a three months, but after the three months, once you razzle dazzle them, it should be into 12 months. But then you can say, all right, there’s my, my cash for projections. I’ve got 12 months of work and 12 months of cash in the bank and you then can scale according to demand and not be in a case. It’s like, shit, I don’t really have work for next week, but I’ve got 16 developers or five developers that I have to cover their costs. Do you want to deal with all of the five guys? Do you want to work on like tidying up the agency website?
Lee Jackson: Oh, the amount of websites we rebuilt. Exactly right. So I think this is a really good point for us to wind down because you’ve given us so much value and I think you’ve helped us understand that perhaps the old model or not even perhaps, but I think the old model is absolutely broken from the way that many agencies have worked. Hey, could you build us a website show? This is how much is going to cost. Let’s get cracking. What you’re talking about here is how can we help you with a much bigger problem, Mr or Mrs client and how can we build up a long term relationship that means the client is going to benefit because they’re gonna make more money and you the agency are going to be able to benefit because you can build up a recurring revenue stream and then you don’t have to get your team to keep rebuilding your website or whatever you’re trying to do to fill those stressful hours when there’s no money coming in. So this sounds amazing, folks. If you want to find out more about Rachel, you can find out on ecommercepartnerships.com I highly recommend as well that you go ahead and follow her on the socials. How can people connect with you, Rachel, and then we should kick you off the show.
Rachel Jacobs: Kick me off show. Yeah, you can find me at ecommercepartnerships.com or just drop me an email Rachel@ecommercepartnerships.com. I’m on Twitter with Rachel Jacobs and same on, on LinkedIn. Not that difficult to track down when you have a website.
Lee Jackson: Indeed. So ecommercepartnerships.com. Rachel, thank you for your time. Now get lost. I’m joking. I mean, have a wonderful day. Take care and have a wonderful day.
Rachel Jacobs: Thanks I will. Take it easy.
Lee Jackson: Cheerio.
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