People Don’t Buy Widgets—So What are you Marketing?

frank cowell

Frank Cowell is CEO of Elevator Agency, a full-funnel digital agency providing a fully-integrated, synergistic marketing “ecosystem,” differentiates his agency by a number of things. The first one is that accounts are managed by strategists instead of by account managers. Why strategists? Frank has found that strategy development, system testing and optimizing, and working with the client is a big, full time job, and should be a billable function, not something to be covered through the less transparent means of skimming off other line items.

In this interview, Frank explains why he believes that most agencies (and many other companies) fail to sell the “right thing” . . . they more often talk about the “line item” services or skills their companies offer instead of selling outcomes. His company’s “elevator formula” involves understanding “what you want a business to ultimately be,” the “outcome of what you are selling,” and “the methodology for achieving those outcomes on a consistent, predictable basis.” Everything must be crafted with that end in mind, including the client selection process and team-building. He feels that companies start out as “consultancies,” and only become “businesses” when the principals can walk away for a month and the company continues to operate.

To achieve this level of organizational maturity, Frank notes that a company has to have a completely clear vision on its branding: Who is it going after as clients? What is its value proposition? and What brand promises does it need to make to win this business? It also needs to implement some variety of an Entrepreneurial Operating System whereby the organization focuses on a limited number of issues over 90-day cycles so that problems are truly solved and the company can move forward. In marketing itself, the company has to sell outcomes . . . and to differentiate itself from the competition.

Frank outlines his Elevator Formula, which provides a both repeatable methodology and service differentiation. The Elevator Formula is a defined process the agency uses for selecting clients, developing a winning proposal, and delivering a strategic plan that produces the outcome a client wants.

  1. Assume the majority of contacts don’t have a problem you can solve, or, for some other reason, are not a fit for your agency. Only consider taking on a client when you are certain they are a right fit . . . and that you will be able to help them accomplish the desired outcome. Is the outcome what this prospect wants and/or needs?
  2.  The next part of the process is discovery. What are the prospect’s target markets? What is their business model? What outcomes are they targeting? The purpose of discovery is to identify the “opportunity,” but also to qualify the contact at a high level. Does the contact have the budget and the authority to act?
  3. In the collaborative planning stage, the prospect and agency work together to fill in the blanks on the Elevator Formula blueprint, building a high level strategy. When the client helps build the plan, they are more likely to accept the presented solution/proposal . . . because they already have vested interest in it.

Frank’s emphasizes the importance of an agency fully understanding itself, what is it really selling, who is it selling to, and what is its desired outcome . . . and mirrors that model when describing what an agency needs to do to effectively serve a client: to understand the client, what is the client selling, who is it selling to, and what is its desired outcome . . . These critical questions that can redefine marketing strategies for both the agency and the client.

Frank can be reached on his company’s website at: elevatoragency.com, on Instagram and Twitter as @FrankCowell or by email at: frank@elevatoragency.com.

 

ROB: Welcome to the Marketing Agency Leadership Podcast. I am your host, Rob Kischuk, and I am joined today by Frank Cowell, CEO of Elevator Agency based in San Diego, California. Welcome, Frank.

FRANK: Rob, how are you?

ROB: I’m fantastic, how are you?

FRANK: Fantastic as well. It’s great to be here with you.

ROB: Yeah, thanks for holing up in a room to record. Is it a day to sit outside in San Diego, as it so often is?

FRANK: It’s beautiful right now. I will not complain about it. It’s October and it feels great.

ROB: We’re in Atlanta, staring down the remnants of this hurricane when it comes through. It’ll be fun times here tonight. Give people a little idea of when we’re recording this.

Frank, why don’t you start off by telling us about Elevator Agency and what makes Elevator great?

FRANK: We’re a digital marketing agency based out of San Diego. What makes us great is we are a full funnel agency able to help clients devise their digital strategy, so that way all the activities that go into their digital marketing program aren’t just one-off, siloed activities.

We have a methodology we call the Elevator Formula. Essentially, it’s about bringing all of those things together in a way that allows those activities to work upon one another and benefit from one another, so that way at the end we’re looking at the entire thing as an ecosystem.

We put the players in place to make that happen on our team. We find that it’s really successful by having the program led by not just an account manager, but a true strategist, someone that the client is actually charged for as opposed to what I think a lot of agencies do where that account management role is more of just a glorified PM, and it’s often paid for by just skimming off of all the other services that are sold to the clients.

I’ve found over the years that that’s a huge problem trying to get that role paid for, and it also means that it’s just a PM role more than anything. We’ve found that strategy and actually running tests and optimizing and working with the client, that’s a full-time job. That’s a big job, and it’s not meant to be paid for by skimming off of all of the other line items.

ROB: I think clients probably appreciate that transparency. Everybody wonders, right? Everybody knows that this person who keeps talking to you gets paid somehow, and it’s probably paid for by the client.

I appreciate that you have this Elevator Formula. I think quite often having that defined process is great for both repeatability and for differentiation against someone who says, “What do you do?” If you say “We buy ads for you,” it’s hard for a client to really buy into that vision. Dig in a little deeper on the Elevator Formula. How would you explain it? I think you already did a little bit.

FRANK: I often talk to agencies about the need to really think about what they’re selling, and in my opinion, most agencies – and a lot of businesses, really – end up selling the wrong thing.

Agencies end up oftentimes selling what I call “hands.” “We have people that know how to wield Photoshop and know how to wield some dev software and they know how to navigate Facebook ads.” They end up selling these hands to do whatever those hands can do. They get caught up selling these line items, these service offerings, instead of selling the outcome.

I think this is the number one shift agencies have to make. They have to understand what it is they’re truly selling and be obsessed about crafting everything around that, including how they do it, which is the process – which is also how you select clients and how you build your team. It really drives everything.

I often liken it to – there’s a little story I tell. If you were to open up a tool bag – say there’s a random tool bag placed in the room, and in there was a hammer, a saw, a drill, a level, a notepad, and a pencil. If you saw these tools, you wouldn’t necessarily know if that was the tool bag of a fence builder, a remodeler, or a furniture maker, because those tools can be used in all of those businesses.

But if you were to go to the furniture maker and ask that person to build you a fence, they would say, “No, I make furniture.” If you go to the remodeler and ask them to do furniture, you would get the same kind of response.

But in agency world, for some reason, someone comes to us and says, “Hey, you’re a marketer and you have all these skillsets, so can you do this random thing?”, here we go as agencies and go, “Absolutely! Let me pull out a blank sheet of paper and let me just start scoping this need you have. Let’s start solving your problem.”

I think that’s great. I think that’s where we all come from as agency people, as “creatives.” But that doesn’t necessarily make for a great business. It makes for a great consultancy. If you’re listening today and that’s what you have, a consultancy, there’s nothing wrong with that if that’s all you ever want it to be. I think that’s a really important distinction.

I’m going to get around to answering your question, Rob, but I think this is what leads into the need to define something like the Elevator Formula, which is understanding what you want a business to ultimately be.

When I say consultancy, I mean if you’re listening today and you’re calling yourself an agency, and it’s you and two or three people, that’s really more of a consultancy. It’s you, the owner – you’re the principal – and you have some helpers. There’s nothing wrong with that. There’s nothing wrong with having a consultancy.

But if you’re looking to go to the next level, if you’re looking to turn it into a business to where you could literally be gone for a month and everything still runs – it’s a business – then there are a number of things that have to be done to make that shift.

So, along the lines of what you just asked, you have to understand the outcome of what you’re selling, and you have to come up with your own approach as to how that outcome is achieved consistently, predictably. Once you define that approach, then you give it a name, and you brand it and you make it your own.

It’s really critical that you do that because in order to increase value, you have to sell on outcome, and then in order to stand out from the crowd, you have to differentiate. That approach has to be unique to you. It has to be unique based on your experiences that you bring to the client, and something that they can resonate with and nod their head in agreement with and be excited about.

ROB: To that point, how do you diagnose the true business need and get clients to start to move along in the Elevator Formula?

FRANK: How do we do that, or how does an agency go about developing their own?

ROB: How do you do that?

FRANK: One of the things that we do is not unlike what a lot of people do, which is in that initial stage, we’re trying to understand if we’re a fit, and how we can help them, or if we’re even able to help that person, that company. I think that’s a really important first part of the process.

I go into it assuming a majority of the connections we make are not able to be helped by us, and I think this is a very, very important mindset shift that anyone selling pro services has to make. I suggest going into every initial call assuming that person’s not a fit, and then go through that call to where they have to convince you. I’m not suggesting you make them pitch you or beg you, but in your mind, you have to be convinced that they are a right fit, that you actually can help them achieve the outcome.

In that initial conversation, we’re talking about that outcome and trying to understand if that outcome is what they truly want and what they truly need. If so, are they the right person in the organization? Is it the right time for them? Is their size of opportunity right? To me, it starts there. It has to be where you have the mindset that most people are not qualified for you, so now you have to go all the way to the other side.

I think this is the opposite of what happens, which is most people selling pro services go into it and every initial conversation is more on the “yes” side. So we end up filling our pipelines with unqualified opportunities, and we end up signing clients that we truly can’t help.

That’s Step 1. The next thing we do is, once we do that, we go into a discovery process with that prospect. We deeply want to understand the business. We ask very few questions about the tactics. When we’re in there, I’m asking very few questions about SEO and the current PPC and all of these other things. Really trying to understand the target markets that they’re after, their business model, what outcome they bring to their marketplace.

Ultimately what we’re trying to do is figure out where the first opportunity lies. If we can understand that and everything is in agreement to that point, we’re also doing some high-level qualifying there as well, at both of those stages, and making sure that we’re not going to go deep in the process with somebody who doesn’t have budget and authority and these other things.

When we move into Stage 2, we’re doing collaborative planning. I think a really important thing that agencies need to start doing in their sales process is to do collaborative planning instead of going off and planning without the client and then coming back and presenting a proposal, doing your presentation, whatever you call it.

The collaborative planning process is where we pull out our Elevator Formula Blueprint. We have a diagram, fill-in-the-blanks kind of document where we will go through that together. Your main contact is helping you build this high-level strategy. It’s not down to the tactical details, but they’re helping build a high-level strategy in this document so then when you go to the third stage, which is presenting the solution and why we’re absolutely the right team to help you accomplish your outcome, it’s kind of a foregone conclusion that they’re going to do business with us because they helped build the plan.

ROB: That’s such a good feeling compared to the feeling when you work in the dark – and you know the feeling – at least in my own experience, when you’re working on the proposal and you don’t know what the client wants, what their budget is, if they want what you’re going to kick out the other side, it feels uncomfortable. Then you get to this point where you spit out a proposal and a price, and you’ve done all this work and you don’t know if it’s going to be accepted.

I think it would be very wise to listen to you here and not have to face that, to have the joy of having built a solution together with a client and to have confidence that it’s something that they want to do.

FRANK: Yeah, absolutely. There are a few big things that have to be checked off in the early part of the process. If you’re getting to that final stage and you’re presenting and you hear things like, “that’s more than what we wanted to invest,” they shouldn’t have made it that far to begin with.

The big takeaways I would say here as far as this part of our conversation would be, one, in that initial phone call, that 15-30 minutes where you’ve maybe got the incoming lead or someone hands you a lead and you just have that really quick initial call to then set up your discovery, go into that call with the assumption they’re not qualified. Go in with the assumption that the vast majority are not a fit because they don’t have a problem that you can solve, or for whatever other reason.

Take that mentality, and then the other thing I would suggest is use that second step, third step, however it works in your business, to do collaborative planning. Don’t just do a great discovery interview and then go off and do planning on your own and then come back to present the proposal. Do collaborative planning.

Then you’re going to be able to have them tell you right then and there, “Oh no, we’re going to spend this much in media. Really, I think we can take this part on,” and then you can have a conversation. “Great, if we take these parts on, it’s probably in this neighborhood in terms of pricing, and when we combine media . . . .” You can then start to actually work with the budget that they tell you.

You’re right then and there figuring out how you’re going to come up with a roadmap – again, we call it a blueprint – that fits what they’re trying to accomplish, including budget. Then by the time you get to the proposal, these things have already been discussed.

ROB: That’s great. If we rewind a little bit, Frank, what led you to start the agency in the first place?

FRANK: I think like most people who start businesses – what does the book The E-Myth call it, the entrepreneurial seizure? You just wake up one day and think, “I can do this and I can do it better.”

I was working for a company back in 2000-2001, and they were in the web development space. Prior to joining that company, I had been doing stuff on the internet since like 1997. I know I’m really dating myself, but this was back when literally you could go to Fry’s Electronics and buy a phonebook-style book of the websites on the internet. This is when I started. I started dabbling in building webpages and selling things online and whatnot.

So, I was dabbling this whole time and learning this stuff, and it was really fascinating. Concurrently, I had a j,ob with a company that did web development for the healthcare sector. Through this whole process, I got introduced to this concept of content management. This was back when you paid for content management. It wasn’t a free WordPress download. You paid $25,000-$50,000+ for your installation, plus services, plus modules.

I was really fascinated by this – because I had already been a programmer by this point. I already had started doing web programming. So, I would go home at night and start building my own content management system, and I’d code my brains out till 4:00 in the morning. I didn’t have a business, I didn’t have a client. It was just fascinating to me.

It got to a point where I kept telling myself, eventually I’m going to go out on my own, I’m going to do this, I’m going to do this. I was working remote for the company at the time, and they had made a statement that they wanted all remote employees to come back to the home office. They didn’t want to do the remote thing anymore. I was living in San Diego, and I said, well, this is the violent shove I needed. I’d been threatening myself to go out on my own.

So, I told the company, “I’m not going to come back. I’m not moving back, so here I go.” I’m kind of glad that happened, because I could’ve threatened myself that I was going to do it for probably years and let that drag on, but that was the violent shove I needed.

ROB: What have been some of the interesting inflection points along the way? Perhaps even when you went from thinking it was something you were going to try to realizing it was something that was really going to work and be a longer journey for you.

FRANK: There was no “I think I’m going to do this, we’ll see how it works out” because when that leap happened, I had a wife, kids, and a mortgage. There was no, “Let’s see if this works out.” Do you know what I mean?

ROB: Yeah.

FRANK: There were definitely some hardships along the way, but there was never, “Let’s see if this works, it might not work, maybe it could fail” because that would mean that I wouldn’t be able to provide for my family. It just wasn’t an option.

Along the way there’s been many ups and downs, but we’ve survived, and that’s just due to probably an insane-like persistence. I think most sane people would’ve probably said “this isn’t worth it.” I think that’s probably what most entrepreneurs face as they go through this period of those hard times where you’re trying to turn it into a business.

I made mention a moment ago about it’s a business when you can be gone and the thing just runs. But until then, it’s a consultancy. It’s self-employment. Again, there’s nothing wrong with that if that’s your jam, if that’s your goal. But for those that are here today and they want it to be that, they want it to be a business that runs without them, it’s just a tough journey to get to that place. It’s really tough.

So, we persevered and made it, and along the way we did some really cool things. We expanded offices, we acquired a small design agency at one point.

I would say the absolute biggest thing we’ve done actually just happened within the past few months. I don’t have a ton of details on it because it’s not a public announcement yet, but we completed a merger with another agency. We were already successful, and now we’ve doubled our size overnight, kind of thing. That has been a massive highlight for us as well.

It’s just continuing to push and take things to the next level, but along the way, like I mentioned, there’s been plenty of side roads that I didn’t need to take. But it was part of the journey.

ROB: That’s very exciting with that merger. We’ll have to keep our eyes peeled to see the actual announcement of that. When do you think you will be able to speak more excitedly about that, and publicly?

FRANK: We’ve got a lot of really cool things we’re working on right now to bring that public. Our clients currently, we let them know right away, and obviously employees and partners and things of that nature. The more public announcement, we’re targeting the January timeframe. January 2019.

ROB: That’s great. We will look forward to it.

FRANK: Yeah, we’re pretty excited about that. I feel like both of our companies, independently we’re pretty cool and capable, and now together it’s kind of us putting the world on notice.

ROB: Look out. So you’re global and at least national in reach with your clients?

FRANK: Yeah. A lot of our stuff is national, and certainly we have clients around the world. The vast majority is obviously U.S.-based, but certainly that is going to continue to expand.

ROB: For sure. You’ve already mentioned a little bit of this, but what are some other key lessons that you’ve learned along the way that you might do differently if you were starting Elevator over again?

FRANK: If I was starting over again, I would place a lot more emphasis on a single problem for a single market that I could solve, and then I would predevelop the solution to that problem for that market. I would do that first, because the focus that I would’ve had by doing that and the speed of the traction would’ve been much greater.

I think a huge, huge challenge by having an “agency” is that there’s so much custom work involved. Custom service is just extremely hard to scale. In my opinion, the only way that scales is if you’re selling to a big enough client and you have a rate that has a fat enough margin that it’s going to be your engine for growth. You have to go get those kinds of clients.

But too many times when I look at agencies, they’re doing custom services, but they’re doing them for the local CPA firm, and the monthly retainer is like $1,272. You can’t grow custom services that way. If you’re going to be at that price range, you have to figure out a way to standardize that and automate and streamline. It can’t be custom.

That’s a huge challenge in our industry. It attracts people who love to custom-solve each individual client’s problem, but to turn that into a business, you have to deal with a much bigger client paying you a lot more money for that model to work as a business. I would say that’s one of the biggest lessons learned, is figuring that out and building that model accordingly. I would’ve done that in the very beginning had I done this all over again.

ROB: That’s a tough lesson to come to, but it is one that we do tend to hear from people. I think in particular when you’re doing that super-custom thing, and you combine with that that a lot of times if you’re at that maturity level as an agency, you’re also charging by the hour – you then also have no incentive to create efficiencies that would let you increase your profitability. You’re just locked into doing this very manual thing at this hourly rate in ways that will probably drive you crazy.

FRANK: Yeah. I think custom services can be fun, and we did it for many years, but it’s also not the thing that allowed me to sleep well at night. I personally had to get into client meetings.

ROB: Absolutely. There’s a branding agency here in town that does very unscalable and very quality work, and I think they enjoy the creativity of it. I know companies who have raised a million dollars and they go to these folks and they spend $50,000 with them. I think those folks can sleep well at night because they have positioned – they’re not doing startup branding for $1,000.

FRANK: Correct. If you’re going to do custom services and you want it to be small, boutique, and you, the principal, are still heavily involved in the work and the client relationships – again, this is not an indictment against that. Awesome, more power to you, and that’s great.

A lot of the agency owners I talk to, the big theme is they want to get out of that. They want to grow. They want to figure out how to take this to the next level. I think it’s just understanding, what do you really want, and what are you willing to do?

ROB: You said this earlier on, when you were talking about thinking through what an agency should offer. You mentioned what is unique based on your own experiences. I think one of the hardest things to arrive at that, though, can be getting out of your own head and getting out of the operational details of the business.

How do you think about doing that in a way that someone can reflect and observe what’s true to them and can thus be very true and valuable to clients, without getting stuck in their own head and business?

FRANK: Growing small companies to get to a place where that kind of thing can happen, I think it’s imperative that agencies figure out how to grow and expand their leadership team and get on a management methodology that allows for those things to happen – and more importantly, it allows the principal, the owner, whoever the primary shareholder is, to reduce their importance to the business and not have to be the one that is the brainchild on everything.

If we truly look at it, we as agency owners, we’re probably really good at like two things, but instead we’re dictating one hundred things. So, I would say it’s critical that agencies get on a management framework. The one that I run my company on is called EOS, the Entrepreneurial Operating System.

Having a proper, built-out leadership team means that the maturity of the way the company runs now, I’m not even involved in. I may have some input on some of the big decisions in some of those areas, but it’s my job to trust and rely on that person on my leadership team to handle that area of the business.

A big part of that program starts with defining vision. There’s a whole vision process in EOS, and in there you define who it is that you’re going after, what outcome or what value you’re bringing them, what brand promises you need to make to them. Honing in on that makes your brand crystal clear, so that way it’s not just what the owner thinks, but you’re going through the process to really deliver what your client wants. What is that outcome?

ROB: The underpinning book for EOS is Traction by Gino Wickman. Is that the right one?

FRANK: Correct.

ROB: Cool. Yeah, it’s an easy read, but it’s also a perennially helpful read. The Entrepreneurs’ Organization I’m involved in in Atlanta does quarterly learning days around four sections of the book, four key – execution, people, strategy, and cash – and I find every year, it’s almost new again. The business has changed and there is something new I need to learn, some way I need to tweak a process or make it better.

It’s really interesting how it applies over time. Probably doing all the tools at first would be completely overwhelming.

FRANK: Correct. What I love about EOS is it has a 90-day view on the entire business. Everything goes in 90-day cycles. By running that way, it ensures that you focus on the things that have to be accomplished in the next 90 days, not the list of 100 things.

I think that’s another area where I see small business owners going really wrong. They have this big list of issues, these things that need to be tackled, and they’re attempting to tackle and solve 27 things at a time. What ends up happening is not one of those things actually gets done with quality. Not one of those things actually gets done to where when it’s done, it’s also operationalized, to where it’s on autopilot and never becomes an issue again.

What EOS teaches is, less is more. You’re going to take on less quarterly projects as a leadership team to impact the company, but you’re going to do them in a way to where they’re properly defined in terms of the problem and the solution. You’re going to stay on track and true to those things, and you’re going to get them done with high quality. I think that’s a massive mindset shift that small business owners need to make.

ROB: That’s a lot of wisdom in there, Frank. A lot of good things to chew on there. When people want to find you and find Elevator, where should they look for you? How should they get in touch?

FRANK: On the interwebs at elevatoragency.com. I’m @FrankCowell on a number of the popular platforms – Instagram, Twitter, whatever the cool kids are doing today. Probably the easiest thing would be either Instagram, I’ve got a YouTube channel that I’ve started, or email (frank@elevatoragency.com).

Whatever way you want to hit me up, I’m always happy to talk with other agency owners and help them figure out how to take their game to the next level – so much so to where I take on a handful of agency owners as clients to coach them. So if someone’s listening today and they’re interested in that, get in touch. I’d love to have a chat with you.

ROB: It sounds like that would be tremendously valuable for someone, Frank. You’ve got a discipline and a maturity to what you’re doing and how you think about things that I think can help a lot of people get their businesses to a new level. Thank you for sharing.

Thank you to Jason Berkowitz from Break The Web for this introduction. Jason was one of our very early episodes, if folks want to go back and give that one a listen. Thanks so much for joining us, Frank.

FRANK: Rob, thanks for having me.

ROB: A pleasure. Take care.

FRANK: Take care.

ROB: Thank you for listening. The Marketing Agency Leadership Podcast is presented by Converge. Converge helps digital marketing agencies and brands automate their reporting so they can be more profitable, accurate, and responsive. To learn more about how Converge can automate your marketing reporting, email info@convergehq.com, or visit us on the web at convergehq.com.

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