Hello BrightIdeas.co readers!
My name is Drew, and I am Trent’s competition in the “Race for $20K” agency challenge. I thought I’d focus this week’s update — my first — on who I am and what I am trying to do. That way you all will know who the guy is who is kicking Trent’s ass all over western Idaho after beating him over the head with a sack of potatoes.
So who am I?
My life story is on my blog, DrewSanocki.com, where I write about ecommerce and marketing. Read it if you are bored, but here are the cliff’s notes. My background is in ecommerce and marketing. About ten years ago, I self-funded, grew, then sold an online retailer, DesignPublic.com. It was the quintessential lifestyle business, complete with highly automated marketing and operations processes able to be run from anywhere. After our exit, I started advising private equity firms on how to grow their portfolio companies and diligence potential online acquisitions — today this is where I make most of my income.
As Trent likes to give a family update in this space, I’ll do that too. I live in New York City. My wife is the travel editor at the Wall Street Journal, so we travel a lot (last week’s trip was to beta test Google Glass, read about it here). And I have a one-and-a-half year old son.
I want you to know about my family so you can get a sense of my overarching goal: to provide stable income security to the three most important people in my life in a way that allows us to keep traveling and enjoying life.
That last part is key, and it’s why I’ve entered this challenge.
What I am trying to do
In the course of running my own retailer and working with many of other ones, I see a lot of what is and is not working in online retail.
One glaring deficiency I’ve noticed is that a lot of retailers lose money on paid search. It happens for many reasons — eCommerce margins don’t give a lot of room for paid search efforts (especially for drop-shippers), competition is intense, and customer lifetime values are low unless the business has a subscription component (making it vital to make money on an initial conversion).
But more than anything else, I think the big reason retailers fail at paid search is that they are asleep at the wheel, or they have outsourced paid search management to an agency that is asleep at the wheel.
I’ve written a fair amount about how to better dial in paid search, and a few months ago I put my money where my big mouth is and started an agency, Mineral.io, to better serve eCommerce retailers with outsourced marketing services.
Our first product? Paid search.
But I don’t want Mineral to be a typical paid search agency. Typical agencies have paid search ‘grunts’ managing upwards of 150 clients each, or they plug their clients into automated bidding tools that neglect to account for the nuances of each market. They also fail to hold themselves accountable, insist on long term contracts, and don’t consider relevancy or user personas when building out campaigns.
What is most important, they don’t target eCommerce retailers — and eCommerce is a different beast that requires more advanced tools to tame. It requires capabilities around shopping feed management, re-marketing, and customer lifetime value that most agencies lack.
So Mineral will develop a kick-ass paid search offering that reinvents the experience for online retailers. But I also want it to be the kind of agency I personally would like to run. I don’t want a huge headcount — maybe not any headcount at all. I have one partner in my brother, and I’d like it to stay that way. I want to make money while I sleep, something I really enjoyed at DesignPublic.com. And as devotee of bloggers of Brennan Dunn and Dan Norris (ok, and Trent Dyrsmid), I want only recurring, highly automated, highly scalable revenue from my agency.
This is the kind of agency that would divorce my time from my income, the kind that I scale and someday sell.
I’ll try to delve more into the strategy behind what I’m offering in the coming weeks, but for now that’s the bottom line what (paid search for online retailers) and how (retainer-based consulting as a service).
Where we are now
This wouldn’t be a fair contest unless I gave you a picture of where my agency is today. We’ve been doing paid search for retailers since the beginning of the year, but — here’s the key — not under any sort of program or formal offering.
Typically we do some consulting work for a client, they ask us to take on paid search, and we say “sure, we can do that”.
This is not the ideal highly-automated, well-serviced revenue that I ultimately want. Instead our current offering is all over the place. Some clients get weekly calls, others no calls. For some we do things like landing page development and metrics management that we don’t do for others.
I’ve been doing this in the spirit of creating a concierge MVP. For those unfamiliar with the philosophy, it basically means you take on a few clients and handle them in a high-touch, non-scalable, often not-profitable way in order to gain insights into 1) their exact needs and 2) how to service those needs better. My hope was that by running a concierge MVP in eCommerce paid search, I would be able to develop the scalable operation on the back-end that I eventually could use to launch a scalable, profitable product serving fifty or more clients.
So today we have nine paying clients in our concierge MVP yielding $7K in recurring revenue. That’s my $20K Challenge starting point (so to beat Trent I actually need to make it to $24K because he is starting at $3K and he wants to get to $20K, a jump of $17K . . . follow?). And starting now, I’m ready to ditch the concierge and use my learnings to roll out a more formal offering, “Mineral Paid Search for Ecommerce Retailers” also known as The Product That Will Bury Trent Dyrsmid.
That launch should happen over the next week or so.
Here’s what I did this week . . . more updates to come!
- Made a dumb-ass comment on an otherwise boring catch-up call with Trent that we should race to $20K seeing as that that was a goal for both of us.
- Realized after hanging up and seeing Trent’s subsequent blog post that he took my remark seriously and that I would need to start blogging for him.
- Informed my team of oDesk subcontractors that they were competing against Trent Dyrsmid and that they needed to step up their game if they had any pride at all in our oDesk team group. (This was met with silence, or maybe “Win one for the Gipper!” just doesn’t translate into Ukrainian.)
- Informed my wife and one-and-a-half year old that they were also competing against Trent and, by extension, his family. This was also met with silence and a request for crackers (respectively).
That’s all for now, I’ll see you next week. If you are interested in reading at all about marketing, startups, and online retail, I do encourage you to check out my blog and some of the more popular posts listed in the right sidebar.
Have a great weekend ~