Mineral Update for September 19th

Race For 20K Agency Challenge

Race For 20K Agency Challenge drip campaign

Hi Bright Ideas readers, Drew again from DrewSanocki.com. As a refresher, I run an agency — Mineral.io — that is competing with Groove in a race for recurring revenue. My agency focuses on delivering services to ecommerce retailers.

I want to share some updates on what we’ve been working on, as well as some open questions I’ve been pondering lately.

Here’s a Summary of Our Major Tasks for the Last Month

First, an update on what we’ve been up to at Mineral.io:

  • Built out a drip campaign on “How to Increase your Traffic Using Paid Advertising”: This involved putting both a lead magnet on the Mineral.io website as well as building out a multi-day auto responder e-course. That drip campaign drives traffic to this webinar and that webinar, in turn, should educate, build trust, and ultimately convert viewers into clients.
  • I ran our first webinar – a week ago. We had about 10 attendees, and it was only a test webinar, so we ran it with current clients. It went over a lot of the same information we will cover in the next webinar, and overall I think it was well-received. Got me comfortable in front of the mic too.
  • We went live with our listing on Shopify.com: Shopify has an online marketplace for all of it’s preferred agencies and vendors, so we listed Mineral. And as soon as we went live we were inundated with requests . . . a mixed blessing, more on that below . . . .
  • We set up a Shopify Meetup group in NYC: We really believe in offline interaction. I know some of you may not like it because it’s not scalable, but it’s our view that people want to meet you face to face and build up a bit of trust. So, we set up a Meetup for Shopify ecommerce retailers in NYC. We are up to 60 members now and hosting our first meeting in a week at our offices here in midtown, where we will go over some of the top tactics we are seeing in paid search and paid advertising. I don’t plan to “put on the hard sell” at that meeting, but I’m optimistic that we can get some new clients out of it.
  • Update on our monthly total: Mineral.io is still chugging along at around 5K a month in retainer income, we lost a client and then gained a client, so that’s where we’re sitting currently. As a bit of a disclaimer here, I know that needle hasn’t moved in months, and that’s because we got a huge amount of project work.  Fortunately, it’s just the recurring part that’s lagging . . .

Two Issues I’m Currently Dealing With:

First issue — since listing on the Shopify directory, we’ve been getting a ton of requests. Sounds great- but the issue with this is that they are a lot of very low-end requests.

In other words, prospects are asking for entry-level design tweaks, or they want a paid search campaign set up, but don’t want to spend a lot of money.

So, the first thing we are thinking about doing is offering an even lower-end offering. I know, crazy. But I think we can restructure our current paid advertising offering to offer it at a much lower price point; strip out a lot of the service we are doing and instead focusing on setup and basic maintenance.

We are also talking about a recurring revenue design and build product. Right now, my partner runs our Shopify design and builds, and we’ve got a great team to turn that into a recurring product.

Second issue — another large group of requests that are coming in these days are from other agencies that want to use our services to enhance their offering. For example, development agencies that want to use us as outsourced marketing services partner.

To be honest, we’ve always considered doing a white-label version of our products – we think it’s a great way to scale. We designed everything from the ground up so we could put another agency’s branding on our paid search reports or on our email and weekly interactions with our clients.

It’s very low cost for us to roll it out to another agency, and we give them a high amount of value, so it had been on our timeline for Q1 2015. However, because we are getting so many inquires on it, it may be something we have to fastrack, so that’s what I’m going to be playing with over the next week.

These were two completely unexpected issues, and it caused us to think a little bit about our current offering and try to figure out how to better monetize the source of inbound leads that has organically come out of nowhere.

Here’s a final question to you:

marketing agency

Should we become a 360-degree marketing agency? I’ve always thought that was a bad idea because I thought specialization was key. But more and more of our clients are demanding the whole enchilada — SEO, SEM, email, content, and design/build.

I asked some of our clients if they’d be interested in us adding some of those services to our offering and they all said “YES!”. So, right now we are playing with the idea of becoming more of a 360-degree marketing agency – focusing on Shopify.

And that’s the big question right now, I’d be curious what you all think as you all run agencies.

That’s my update! Thanks, Drew

Hey, thanks for the info. Now what?

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  • Guest

    Hey Drew! Jake Puhl here. I run an agency that does all recurring revenue – we’ve been doing it for about 4 years and have fluctuated between 60k-80k/mo recurring most of the time. My $.02 – we were tempted in the beginning many times to take the white label/sell to agency route, the ‘create a lower end product’ route, AND offering the ‘whole enchilida’ route.

    4 years in, my reflection is this: I’m very happy to not have sold a lot to agencies as that seems to me as an ‘all or nothing’ approach. In other words, if you’re going to do that, you’ll need to develop a compentancy at it which will take a lot of your time and resources. It could easily become a distraction if just dipping the toe in. However, I have friends who sell to agencies (that’s all they do) and it is profitable, but I don’t know any doing more than $40k/mo or so. I’m just glad that we stuck with one route. I’m happy we ‘stayed the course’ with selling direct the business and collecting all the profit rather than just a portion of the profit.

    Regarding the low end offers, four years down the road we are now starting to implement those. Previously, we were minimum 1k/mo. For us, a low end offer is actually a good opportunity to get someone in our funnel and upsell them. They key is to create a low end offer that inherently filters out clients that are not qualified to upsell. We use it to build trust, let them see what its like to work with us, and then upsell to bigger and better products. That’s seeming to work well for us.

    Regarding enchiladas, they are delicious, I’m sure we agree 🙂 We’ve been tempted to offer email marketing and stayed away bc it seemed too complicated to add to our process. On the other hand, we believe in ‘owning the client’ meaning we are their ‘go to’ for digital marketing. To do that, we need to do their website, their SEM, their content, everything… bc in reality, those all go together and it makes a lot of sense. The website is crucial to getting results with all the other marketing and without a good one, we never get exceptional results. So we had to start building websites to lead into the SEM products. Now, buildings websites is not that profitable for us, but we use it almost as a loss leader. We don’t start reaping the rewards until year 2 on those when the SEM starts performing very well.

    Ok, hope that helps. Just my $.02, but every situation is different. Awesome post and I’m loving following the ‘race’!!

    • Jake….fabulous feedback. Thanks!

    • Jake — This is great stuff, you are saving me a lot of time. I’m slowly coming to the realization that the low end is just a tough slog. Hard to scale, hard to even move the needle . . . and they tend to blame you for any lack of traction in their business.

      We’ve spent most of this month rethinking things, rolling out a D&B product that has taken off and generated a lot of income (but no recurring).

      Seriously I can’t thank you enough, if you don’t mind I may reach out to BS more about this.

    • Damian Thompson

      Jake is a BOSS! Saw him speak recently at a conference about marketing productized services.

      My 2 cents Drew is to stay FAR away from low end products. When we launched we were charging $500 a month, quickly doubled that to $1k and added more customers. Pricing is almost ALWAYS in your head, people pay for value (perceived or received) so I always tend to advise sticking to higher price points.

      As far as “all-in-one” agencies vs. niched there is no “right answer” other than the kind of business you want to build. I was super focused on software automation at first but realized that i was building a tech support biz (don’t want to do that) so instead of niching on software used now focus on customers served (software & SaaS companies) but do “full stack” demand gen (inbound & outbound) but not full service (we don’t do paid for example) we focus on result not activity, e.g. demand generated not the marketing tactics employed.

      Oh, we also charge $5,000 per month recurring now, no pricing table, no decisions to be made by the customer, We are the experts, not them. My line when someone asks me how much we cost? “We charge a LOT of money for a LONG time… but if we aren’t generating a healthy ROI you can fire us at ANY time.”

      • Damian — I’m convinced. I’ve gradually moved our agency up the value chain over the past month which is why you haven’t heard from us here on BI. Great insight, very valuable. I appreciate it!

  • Hey Drew! Jake Puhl here. I run an agency that does all recurring revenue – we’ve been doing it for about 4 years and have fluctuated between 60k-80k/mo recurring most of the time. My $.02 – we were tempted in the beginning many times to take the white label/sell to agency route, the ‘create a lower end product’ route, AND offering the ‘whole enchilida’ route.

    4 years in, my reflection is this: I’m very happy to not have sold a lot to agencies as that seems to me as an ‘all or nothing’ approach. In other words, if you’re going to do that, you’ll need to develop a compentancy at it which will take a lot of your time and resources. It could easily become a distraction if just dipping the toe in. However, I have friends who sell to agencies (that’s all they do) and it is profitable, but I don’t know any doing more than $40k/mo or so. I’m just glad that we stuck with one route. I’m happy we ‘stayed the course’ with selling direct the business and collecting all the profit rather than just a portion of the profit.

    Regarding the low end offers, four years down the road we are now starting to implement those. Previously, we were minimum 1k/mo. For us, a low end offer is actually a good opportunity to get someone in our funnel and upsell them. They key is to create a low end offer that inherently filters out clients that are not qualified to upsell. We use it to build trust, let them see what its like to work with us, and then upsell to bigger and better products. That’s seeming to work well for us.

    Regarding enchiladas, they are delicious, I’m sure we agree 🙂 We’ve been tempted to offer email marketing and stayed away bc it seemed too complicated to add to our process. On the other hand, we believe in ‘owning the client’ meaning we are their ‘go to’ for digital marketing. To do that, we need to do their website, their SEM, their content, everything… bc in reality, those all go together and it makes a lot of sense. The website is crucial to getting results with all the other marketing and without a good one, we never get exceptional results. So we had to start building websites to lead into the SEM products. Now, buildings websites is not that profitable for us, but we use it almost as a loss leader. We don’t start reaping the rewards until year 2 on those when the SEM starts performing very well.

    Ok, hope that helps. Just my $.02, but every situation is different. Awesome post and I’m loving following the ‘race’!!