BizyDad
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You may already know I run a search engine marketing agency. We are a 99% referral shop, and we only take on at most 3 new marketing clients a month. This might change soon, but historically, I turn down most leads that come my way.
I did it again today, and I want to share the story to maybe get your gears turning, because turning away business is one of my favorite ways to get more referrals. Here's some more ideas.
There are several reasons why I might turn someone away:
Our first meeting was a phone meeting last week. I do a fair bit of fact finding. My goal is to get a sense of their current goal for SEM, what is their history with SEM, what other marketing they do, and what they charge for services. Having accomplished that, I set a follow up meeting (which happened today).
In between I do some research, and I prep the client that in our next meeting I will either lay out a marketing plan, or I will give them reasons why we shouldn't do business (which always takes them by surprise, so I usually mention reason #2 as an example of why we might not do business). I tell them I don't want you to hire me if I know we can't get you results.
Side note, that's my typical sales process. Newbies running a consulting/marketing firm, feel free to try it. If nothing else, that second meeting gives you a bit more credibility in their eyes because you went and did research on them. There are several more benefits, but that's another topic for another day.
As a little background, today's prospect was referred to me by one of my top clients, who is a trusted thought leader in her industry and raves about me, so he was already predisposed to liking me. She is great, but I often have to tone down expectations with her referrals. So this guy today is a lifetime entrepreneur who had spent the last 10 years in tech. He is launching a new venture in a space I am unfamiliar with, but has a large market & growth potential. I really enjoy these kinds of clients because part of the reason I do what I do is to keep growing my knowledge of other business structures/models. So to learn a whole new niche industry is a treat.
The only real "drawback" is the client has a low price point, and that makes certain tactics challenging, but I suspected I could find profitable keyword phrases for him because there is recurring revenue potential built in.
As I said, the guy is in tech, so he felt he had a "good working knowledge" of SEM. And at the end of the call, he said to me, "In all my many meetings, I've never heard of anyone who approached SEO the way you do. But this all makes so much sense. I'm really looking forward to hearing the results of your research." I really wanted to work with this guy; I got off the call ready to make an offer he couldn't refuse.
In between our meetings I did my research. And my heart sank a bit.
When I examined the numbers I learned that this industry was much more competitive than I had imagined. Looking at the numbers, it made sense after the fact, but going in I really had no idea. This niche is too competitive for my style of SEO to deliver timely results. And because of the low margins, I didn't think running ads would prove profitable. Frankly, of the 4 reasons I turn down business, this is the least common for me.
So I started today's meeting by saying to the client and his team, "This is going to be one of those meetings where I tell you not to hire me, but that you need a larger and maybe a more specialized SEO agency."
Then I just went through all the research I did to prepare for the meeting. I gave him the kinds of questions to ask when hiring the bigger agency to make sure he finds a good one. Along the way I gave them 5 more marketing ideas/tactics they could use whether they hire another agency or not, including ideas unrelated to my specialization.
Just before we wrapped the meeting, the prospect says to me, "Wow, I can't believe you've spent an hour showing us all this work only to tell us we shouldn't hire you. I really want to work with you, so how does this sound..." Long story short, I left with information on his 2 more established businesses. Both have the ability to pay at least twice what I would have charged this one out of the gate. And this time I again suspect the numbers will be more in keeping with the kind of business my team can actually deliver results for.
AND he wants me to meet his doctor friend who also needs an SEM strategy.
3 quality leads in one "this is going nowhere" meeting.
That's one way how turning down business leads to more business. I have many stories like this, and if you have another moment I'd like to share my new favorite.
This story starts like 8 years ago or so. Just like the last story, this was a two step sales process. Prospect referred to me by a top client. This guy was the Director of Marketing for his brother's large agricultural business. In our first meeting he told me he had $3k budget he "needed" to spend. For our second meeting he invited me to a networking event where I randomly saw an ex-girlfriend* and ultimately signed another client from that group.
But I turned away his business (this time for reason #2).
He asked if he raised the budget number, would that make a difference?
After a 2 second pause where I considered burning my ethics to the ground, I told him he should just forget about SEO as a marketing tactic because farmers weren't Googling for what he offered. He was surprised, this was a multi-million dollar company with many well-known clients, but his brother had told him the same thing. He understood once I showed him the data.
Turning away $3000+ per month was not easy. I was coming out of some really tough years and at that point in my agency I hadn't signed a client that large. Still, it was the right thing to do.
18 months later he calls me up again. He had left his brother's company and bought an ecommerce store. Would I please help him, he was in over his head. I told him I don't normally take on ecommerce clients, but I'd be happy to at least look at what was going on and do my research. Worst case, I'd again give him some free advice.
Well, again my assumption going in was wrong, and this client had a niche where I could indeed help him. And for the last 6 years I've enjoyed helping him grow his business. Along the way, I've shown up at his office regularly. I've gotten to know his staff and his family. After the first year he started paying me a performance bonus. Pretty sweet deal.
Then COVID hit, and revenues shrank. He decides to accelerate his retirement plan. He calls me up one day back in February to share the new vision. Instead of retiring in 3 years, he wanted to retire in 6 months. And would I be interested in buying his business? This surprised me because we always talked about the possibility of my owning a piece of the business, but his son was the obvious choice to take it over. Then a week later, he flies out to Texas and buys a boat (and doesn't come back for 3 months!!)
So I approach his son. I ask why he isn't buying it, and he replies he's scared of crashing the business. He doesn't have a business background and doesn't trust himself with this. Long story short, we concoct a plan to buy it together. I knew I didn't have the time to run it on my own, and hiring and training the right sales person would prove difficult for me time-wise & knowledge-wise. So partnering with him was my goal.
I'll continue to fulfill the role of marketing and de-facto business coach, and he'll continue to handle the primary sales and managing of the team. We've been working together for the last 3 years, and he has often referred to me as his "boss" even though I viewed myself as his "consigliere", but I pointed out that ultimately, not too much would actually change in his day to day. I asked him to envision the alternative. What's that look like?
Filling out resume after resume only to go back to his previous career, he said.
Waiting for the next layoff? Punching a clock where someone else sets the schedule?
Pretty much, he said. Initially he was skeptical, but after a week he was "on board" with partnership.
We've spent the last 6 months running it as a trial to see how thing will go (and to ensure we can recover lost growth). In that time, the dad has been 100% hands off, and our sales have recovered sufficiently that everyone feels good taking the next steps. And my hopefully-soon-to-be partner has really stepped into his new role of running his side of things. He and I have shown to each other how smooth this can continue to be.
BONUS - the father has lowered his asking price for the business and offered to carry back a bigger chunk of the purchase price. In his words, "I want you two to have it and run it. I know I can get more selling it elsewhere, but I want you two to have it. Let's get this figured out." At that point, this has become close to a no-brainer for me.
I have a meeting with the family this Thursday to begin to formalize the terms of this new arrangement. If everything goes as expected, and even if the company sales just stay stable, I should double my investment in 3 years. With conservative growth I could 4x it. (I don't even want to think about higher growth than that.... Too exciting.)
So here shortly I could be an owner of a second business, and my first 7 figure revenue business. I've been laying the foundation for this possibility for 6 years now. I've wanted to write a post like this ever since I read this excellent post about the opportunity to take over a boomer's business. And of course this excellent thread.
And I haven't even mentioned how many other referrals this guy has sent me. How many doors he's opened.
And how his son also referred my lead writer to me, who's been with us for 3+ years now. Without that guy on my team, I might have shut down my agency at some point during my divorce. That's no joke. I was really close to doing so, and 2 conversations with that guy turned me around and got me going again. He believed in my vision even when I didn't.
NONE of this would have happened if I hadn't turned down a $3000/month client that I knew I would fail to deliver results for and wanted to pay me more.
Thing is Fastlane Fam, even if this doesn't happen, I'm ok with that. You know why? Well, its at least in part because last month a SECOND client approached me to buy their business. And yup, you guessed it, 10 years ago I turned this one away too only to have him come back 6 months later and try to convince me that my research was wrong and that he didn't want to work with other SEO's. Turns out, he was right, I was wrong. His business had recurring revenue, and back then I didn't think to account for that. His campaign was profitable after 4 months. He never sent any referrals, but he's been a loyal client for 10 years. How many agencies can say that? But I'm not looking to buy that business, so that's basically the whole story.
If its happened twice, it'll happen again.
I'll wrap up with this. There are a lot of digital marketers on this forum.
Consider if you charge a fair rate and get results (underpromise/overdeliver) you will be in an excellent position to establish long term rapport with your clients. Having that long term relationship can give you insights into the business you can't otherwise get. Better insights than just looking at Flippa listings or working with a business broker get you. Buying a client's business is less risky than some alternatives. Plus, I'm not chasing these guys, they came to me.
So be honest with people. Treat clients the way you'd want to be treated.
And don't be afraid to tell someone, "Sorry, but we're not the right marketing agency for you."
You never know how doing the right thing could benefit you in the long run. Hope these stories help somebody on here.
(*This advice holds goes for your exes too, by the way. Both clients later told me my ex gave a glowing recommendation that factored into their decision. I had no idea... If I was the type to burn bridges, I doubt either of those clients at that networking event would have signed since they already knew her well. So again, you just never know how treating others with respect can pay off.)
I did it again today, and I want to share the story to maybe get your gears turning, because turning away business is one of my favorite ways to get more referrals. Here's some more ideas.
There are several reasons why I might turn someone away:
- I already have a client in that industry+geography and we don't compete with ourselves for rankings
- There's not enough search traffic for the prospect's offering to make an SEM campaign profitable
- The prospect is putting out PITA vibes (pain in the...)
- The prospect needs a bigger agency than my own
Our first meeting was a phone meeting last week. I do a fair bit of fact finding. My goal is to get a sense of their current goal for SEM, what is their history with SEM, what other marketing they do, and what they charge for services. Having accomplished that, I set a follow up meeting (which happened today).
In between I do some research, and I prep the client that in our next meeting I will either lay out a marketing plan, or I will give them reasons why we shouldn't do business (which always takes them by surprise, so I usually mention reason #2 as an example of why we might not do business). I tell them I don't want you to hire me if I know we can't get you results.
Side note, that's my typical sales process. Newbies running a consulting/marketing firm, feel free to try it. If nothing else, that second meeting gives you a bit more credibility in their eyes because you went and did research on them. There are several more benefits, but that's another topic for another day.
As a little background, today's prospect was referred to me by one of my top clients, who is a trusted thought leader in her industry and raves about me, so he was already predisposed to liking me. She is great, but I often have to tone down expectations with her referrals. So this guy today is a lifetime entrepreneur who had spent the last 10 years in tech. He is launching a new venture in a space I am unfamiliar with, but has a large market & growth potential. I really enjoy these kinds of clients because part of the reason I do what I do is to keep growing my knowledge of other business structures/models. So to learn a whole new niche industry is a treat.
The only real "drawback" is the client has a low price point, and that makes certain tactics challenging, but I suspected I could find profitable keyword phrases for him because there is recurring revenue potential built in.
As I said, the guy is in tech, so he felt he had a "good working knowledge" of SEM. And at the end of the call, he said to me, "In all my many meetings, I've never heard of anyone who approached SEO the way you do. But this all makes so much sense. I'm really looking forward to hearing the results of your research." I really wanted to work with this guy; I got off the call ready to make an offer he couldn't refuse.
In between our meetings I did my research. And my heart sank a bit.
When I examined the numbers I learned that this industry was much more competitive than I had imagined. Looking at the numbers, it made sense after the fact, but going in I really had no idea. This niche is too competitive for my style of SEO to deliver timely results. And because of the low margins, I didn't think running ads would prove profitable. Frankly, of the 4 reasons I turn down business, this is the least common for me.
So I started today's meeting by saying to the client and his team, "This is going to be one of those meetings where I tell you not to hire me, but that you need a larger and maybe a more specialized SEO agency."
Then I just went through all the research I did to prepare for the meeting. I gave him the kinds of questions to ask when hiring the bigger agency to make sure he finds a good one. Along the way I gave them 5 more marketing ideas/tactics they could use whether they hire another agency or not, including ideas unrelated to my specialization.
Just before we wrapped the meeting, the prospect says to me, "Wow, I can't believe you've spent an hour showing us all this work only to tell us we shouldn't hire you. I really want to work with you, so how does this sound..." Long story short, I left with information on his 2 more established businesses. Both have the ability to pay at least twice what I would have charged this one out of the gate. And this time I again suspect the numbers will be more in keeping with the kind of business my team can actually deliver results for.
AND he wants me to meet his doctor friend who also needs an SEM strategy.
3 quality leads in one "this is going nowhere" meeting.
That's one way how turning down business leads to more business. I have many stories like this, and if you have another moment I'd like to share my new favorite.
This story starts like 8 years ago or so. Just like the last story, this was a two step sales process. Prospect referred to me by a top client. This guy was the Director of Marketing for his brother's large agricultural business. In our first meeting he told me he had $3k budget he "needed" to spend. For our second meeting he invited me to a networking event where I randomly saw an ex-girlfriend* and ultimately signed another client from that group.
But I turned away his business (this time for reason #2).
He asked if he raised the budget number, would that make a difference?
After a 2 second pause where I considered burning my ethics to the ground, I told him he should just forget about SEO as a marketing tactic because farmers weren't Googling for what he offered. He was surprised, this was a multi-million dollar company with many well-known clients, but his brother had told him the same thing. He understood once I showed him the data.
Turning away $3000+ per month was not easy. I was coming out of some really tough years and at that point in my agency I hadn't signed a client that large. Still, it was the right thing to do.
18 months later he calls me up again. He had left his brother's company and bought an ecommerce store. Would I please help him, he was in over his head. I told him I don't normally take on ecommerce clients, but I'd be happy to at least look at what was going on and do my research. Worst case, I'd again give him some free advice.
Well, again my assumption going in was wrong, and this client had a niche where I could indeed help him. And for the last 6 years I've enjoyed helping him grow his business. Along the way, I've shown up at his office regularly. I've gotten to know his staff and his family. After the first year he started paying me a performance bonus. Pretty sweet deal.
Then COVID hit, and revenues shrank. He decides to accelerate his retirement plan. He calls me up one day back in February to share the new vision. Instead of retiring in 3 years, he wanted to retire in 6 months. And would I be interested in buying his business? This surprised me because we always talked about the possibility of my owning a piece of the business, but his son was the obvious choice to take it over. Then a week later, he flies out to Texas and buys a boat (and doesn't come back for 3 months!!)
So I approach his son. I ask why he isn't buying it, and he replies he's scared of crashing the business. He doesn't have a business background and doesn't trust himself with this. Long story short, we concoct a plan to buy it together. I knew I didn't have the time to run it on my own, and hiring and training the right sales person would prove difficult for me time-wise & knowledge-wise. So partnering with him was my goal.
I'll continue to fulfill the role of marketing and de-facto business coach, and he'll continue to handle the primary sales and managing of the team. We've been working together for the last 3 years, and he has often referred to me as his "boss" even though I viewed myself as his "consigliere", but I pointed out that ultimately, not too much would actually change in his day to day. I asked him to envision the alternative. What's that look like?
Filling out resume after resume only to go back to his previous career, he said.
Waiting for the next layoff? Punching a clock where someone else sets the schedule?
Pretty much, he said. Initially he was skeptical, but after a week he was "on board" with partnership.
We've spent the last 6 months running it as a trial to see how thing will go (and to ensure we can recover lost growth). In that time, the dad has been 100% hands off, and our sales have recovered sufficiently that everyone feels good taking the next steps. And my hopefully-soon-to-be partner has really stepped into his new role of running his side of things. He and I have shown to each other how smooth this can continue to be.
BONUS - the father has lowered his asking price for the business and offered to carry back a bigger chunk of the purchase price. In his words, "I want you two to have it and run it. I know I can get more selling it elsewhere, but I want you two to have it. Let's get this figured out." At that point, this has become close to a no-brainer for me.
I have a meeting with the family this Thursday to begin to formalize the terms of this new arrangement. If everything goes as expected, and even if the company sales just stay stable, I should double my investment in 3 years. With conservative growth I could 4x it. (I don't even want to think about higher growth than that.... Too exciting.)
So here shortly I could be an owner of a second business, and my first 7 figure revenue business. I've been laying the foundation for this possibility for 6 years now. I've wanted to write a post like this ever since I read this excellent post about the opportunity to take over a boomer's business. And of course this excellent thread.
And I haven't even mentioned how many other referrals this guy has sent me. How many doors he's opened.
And how his son also referred my lead writer to me, who's been with us for 3+ years now. Without that guy on my team, I might have shut down my agency at some point during my divorce. That's no joke. I was really close to doing so, and 2 conversations with that guy turned me around and got me going again. He believed in my vision even when I didn't.
NONE of this would have happened if I hadn't turned down a $3000/month client that I knew I would fail to deliver results for and wanted to pay me more.
Thing is Fastlane Fam, even if this doesn't happen, I'm ok with that. You know why? Well, its at least in part because last month a SECOND client approached me to buy their business. And yup, you guessed it, 10 years ago I turned this one away too only to have him come back 6 months later and try to convince me that my research was wrong and that he didn't want to work with other SEO's. Turns out, he was right, I was wrong. His business had recurring revenue, and back then I didn't think to account for that. His campaign was profitable after 4 months. He never sent any referrals, but he's been a loyal client for 10 years. How many agencies can say that? But I'm not looking to buy that business, so that's basically the whole story.
If its happened twice, it'll happen again.
I'll wrap up with this. There are a lot of digital marketers on this forum.
Consider if you charge a fair rate and get results (underpromise/overdeliver) you will be in an excellent position to establish long term rapport with your clients. Having that long term relationship can give you insights into the business you can't otherwise get. Better insights than just looking at Flippa listings or working with a business broker get you. Buying a client's business is less risky than some alternatives. Plus, I'm not chasing these guys, they came to me.
So be honest with people. Treat clients the way you'd want to be treated.
And don't be afraid to tell someone, "Sorry, but we're not the right marketing agency for you."
You never know how doing the right thing could benefit you in the long run. Hope these stories help somebody on here.
(*This advice holds goes for your exes too, by the way. Both clients later told me my ex gave a glowing recommendation that factored into their decision. I had no idea... If I was the type to burn bridges, I doubt either of those clients at that networking event would have signed since they already knew her well. So again, you just never know how treating others with respect can pay off.)
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