Scaling Your Resources for Dynamic Marketing Agency Growth

Web-20-Ranker-Team-Dec-2016-1

Mark Luckenbaugh, Cofounder of Local Client Takeover and Web 20 Ranker (South Central Pennsylvania), discusses the ever-changing challenges today’s digital marketing agencies face and his risk-minimizing scaling strategy.

 

Mark’s Web 20 Ranker provides “white label” products and services to help digital marketing agencies minimize manual work bottlenecks. White label services and products are supplied by a third party company and “resold” by the client company to its customers as part of its “branded” offerings. White label products and services allow a client company to offer more services to more customers than the client company’s own staff can support?smoothing the transition until economies of scale can justify taking those services in house.

 

Web 20 Ranker identifies internal operating challenges, develops and implements solutions, and then tests and evaluates these solutions as potential offerings for its clients. For instance, in response to Google’s increasingly stringent quality guidelines, Web 20 Ranker developed a hybridized SEO/PPC package to expedite lead generation.

 

Local Client Takeover (localclienttakeover.com), an education-focused site, provides over 50 free digital marketing agency growth and fulfillment strategy training modules, and higher level courses on how to build a consistent stream of local clients.

Mark can be reached on the Local Client Takeover website (localclienttakeover.com) and Web 20 Ranker website (web20ranker.com). On the latter website, make sure to check out his information-rich blogs.

Transcript Follows:

ROB: Welcome to the Marketing Agency Leadership Podcast. I’m your host, Rob Kischuk, and I am joined today by Mark Luckenbaugh, Cofounder of Local Client Takeover and Web 20 Ranker based in South Central Pennsylvania. Welcome, Mark.

 

MARK: Thanks a lot for having me. Appreciate it.

 

ROB: Great to have you on here. Why don’t you kick it off by telling us about your companies and what each one is great at?

 

MARK: Thanks, sure. I guess I noticed a big gap in online education when it came to growing digital marketing agencies and the underlying strategies to sustain the fulfillment of whatever service you’re providing once you bring the client on. This was maybe 3-4 years ago. There are so many people that sell information—and that’s fine; there’s nothing wrong with paying for information by any means—but I noticed a lot of it was recycled. A lot of it seemed lackluster.

 

I put together I guess what you’d call a local-specific course, if you will, and I gave it away for free. I did that under the branding called Local Client Takeover. It started very small. Hundreds and hundreds of people started coming in. I made a free Facebook group where we discussed the content that was in the course. It started to become a real brand, if you will, and it was really cool. It was work. It started off as a hobby for sure.

 

Also, when you’ve run online-based businesses, sometimes it can be difficult to find people to network if you’re not going to a lot of events and Masterminds and stuff like that. So we started to really build a tightknit community. From there, it organically grew based on the free value. We did a lot of fun stuff in the group. We did AMAs, Ask Me Anything. It grew to where we are right around 23,000 members now. It was just all based on that.

 

We’ve had a few different programs, like Masterminds. We did a cool event in Vegas last year, which unfortunately we’re not doing this year. But it was exciting. It was very humbling to see a community you built a few years ago come together. It feels like you know people. Guys that I’ve never met before come up and there are handshakes and hugs, and it feels like a family, like an online family. Really cool.

 

ROB: What about on the Web 20 Ranker? Dig into that company a little bit more.

 

MARK: I started out primarily doing client work, client SEO specifically. Now I do more of a hybrid model where we sell quicker results using PPC. We have PPC and SEO as a hybrid package.

 

I invested a lot of money in growing that company. One of the biggest bottlenecks was dealing with a lot of virtual assistants and managing them, and then building some type of home team, in-office team here in South Central Pennsylvania.

 

As we grew, I figured the best way to do it was to actually get office space abroad. That’s where we can get a bulk amount of the work done, and then everything passes through a few layers of quality control—the last one being right here in our office in Pennsylvania. It allowed us to create higher quality products, but still keep the cost relatively inexpensive.

 

It took us a long way to get there, as with any business where you’re actually staffing offices and hiring and having to take trips across the world. Based on that investment, we realized we had the capability of scale that few companies have the opportunity to leverage.

 

We created Web 20 Ranker as a solution for agencies. We found that we were doing so much manual work when we first started growing our agencies that it bottlenecked our ability to scale. We wanted to create productized packages people could use where it’s like, “We’re not really ready to make the number of hires we need to make to fulfill this service for our clients. Instead, we’re going to focus on using our employees or virtual assistants to perform their core competencies. We’re going to focus on bringing more revenue to the table, getting more clients on board, and we’re just going to lean on Web 20 for now to do this.”

 

We have anything from single products where it’s like, “I just need some citations built. I can handle everything else, but I don’t want to do citation cleanup.” That’s just the bane of every SEO’s existence. [laughs] We have that. Then we have all-encompassing packages where it’s white label and we’re just going to rank the site for you. It’s a complete, done-for-you solution that’s managed and supported and all of that.

 

That grew extremely well, to the point where we became—we’re definitely not the biggest. There are some really big fish in that sea. [laughs] But we’re definitely mentioned among the top handful of white label companies on the market right now.

 

ROB: That’s pretty exciting. So it’s primarily SEO, and sounds like you’re super deep in SEO, and you have tremendous scaling capabilities whether you’re dealing with local businesses adjacent to the Local Client Takeover brand, but also even probably larger B-to-B brands. Is that the mix of services?

 

MARK: Yeah, absolutely. It’s really exciting because since we started offering the hybrid package—I don’t want to get ahead of ourselves, but I definitely recommend people doing so if they’re not. SEO has become a really hard sell, just with the time it takes. It’s not like it used to be; 4 or 5 years ago, we could get sites to rank in under 21 days consistently.

 

We don’t live in that world anymore. Google’s quality guidelines got a more stringent. A lot of the tactics one might’ve used back then just aren’t going to fly anymore. So it became a harder sell, like, hey, invest in this SEO strategy over the next 6-12 months, and it’s going to take 6 months before we can even start generating measurable results, let alone ROI.

 

With the hybrid package, you can start generating leads really, really quickly using PPC, whether it’s Facebook or AdWords. Because we started offering that, we’re now at the point where we’re opening up beta to offer white label AdWords as well. But that’s very small. That’s’ not something we have going on publicly.

 

But we always start with our agency, and that allows us to see, do we have the ability to scale this? We have a fairly large client base. Even when we aren’t really grinding to get more clients, we have a decent acquisition flow. It allows us to test things and we can say, “There’s no way we’re going to be able to offer this outside of our clients” or “We have a system that can definitely scale, so we can try it out.”

 

So that’s where we’re at with the PPC, but yeah, SEO is definitely a core competency. That’s fair to say.

 

ROB: With these strengths—and you mentioned a hybrid of SEO supported with PPC, and in some cases social ads that are PPC-like—you’re apparently pretty good at this, right? I’m not a client, but you have a lot of people that trust you with their clients as well on this white label basis.

 

How did you reach the decision that instead of scaling up even more as an agency directly facing the clients, that you would pursue this white label path and be a little bit behind the scenes? Bigger scale, but maybe a little bit less glory in sharing the budget with an agency upfront.

 

MARK: Yeah. For us it wasn’t a “one or the other.” We still aggressively do belly-to-belly with actual client relationships with business owners. I have a brand that deals primarily with dentists; we do a lot of stuff with lawyers, personal injury attorneys, etc.

 

But something I’ve found is—and this is something I taught in LCT a lot. You could say I preached this. Not as much as like a white label, but like a joint venture where it’s always going to be challenging to acquire one client. That doesn’t matter if it’s a white label relationship where I’m like, “Hey, you have an agency; let me do white label for one of your clients and you can test us out,” or whether I’m trying to get in front of the office manager/marketing manager at a large law firm or dental practice. Regardless, I have to close one sale to create revenue.

 

I started pushing people. Instead of creating that one sale with an actual law practice—which there’s nothing wrong with—sure, you’re going to make some more money, but if you close the sale with—let’s say it’s a web designer. They do beautiful web design, and they craft gorgeous websites. That’s what they are. You essentially allow them to offer your service, and you guys can do some type of commission on that. Maybe you white label for their brand.

 

You’re able to structure a deal that instead of just having one client, you can essentially work with their entire book of clients just off of one sale. Instead of a 1:1 ratio, you just turned your acquisition efforts into a 1:20 ratio. It’s almost like Pareto’s law, the 80/20 of ease of application to create revenue for your agency.

 

We’ve found that there are even SEO agencies who charge at the top end of what you can charge for SEO. It’s easy for them to pay a set amount per package and just hand it off and still have really good margins, and for you to stay profitable.

 

For us, we had an unfair advantage, I’d say, in the white label space just because we have actual office space overseas. We’re not using virtual assistants. We actually have the office space. It’s like a real company. We get insurance for our workers. We do “feed the community” type programs. We do a lot of really cool stuff over there. We’ve built a really strong presence in these communities where people want to come work for us over there.

 

It’s a really cool culture we’ve built inside those offices. It allows us to keep costs low, and at the same time we run everything through that second tier of American quality control. That’s how we can offer the packages we do and still maintain respectable percentages. That’s the reason I said, “Let’s scale this.” Plus we have a community of people in LCT that could be interested in this.

 

But it’s not a “one or the other” for us. The white label thing isn’t right for everyone. I do think almost everyone could make money with joint ventures and dealing with people that already have a book of clients, but white label—you really have to know your numbers and know your capabilities of scale.

 

ROB: I think it’s interesting, because you mirror, in a way, what you’re asking from your clients. In the specializations you’ve chosen—you talk about this hybrid model, so you’ve expanded a little bit—but what you’re not doing is trying to be all things to all people. I think it can be very tempting when building a marketing agency to want to be all things to all people.

 

How do you work with agency owners and leaders to help them realize that maybe this capability along the SEO/pay-per-click advertising might not be something they need to own in-house? I can see that being a challenge, and in some cases maybe even a little bit of a hit to the ego if they’re not very convinced of it.

 

MARK: This is my opinion—you’re going to find incredible, incredible entrepreneurs that might have a different outlook, but here’s my perspective on this. If you really want to offer a product—I like to productize everything. The whole “let’s do a custom this or custom that,” you can still do that and keep things relatively productized.

 

If someone wanted to offer PPC, it can be great to offer in-house. Especially PPC, because sometimes the white label PPC companies are either 1) really bad or 2) expensive. And sometimes they can be a nasty combination of the two. So using that as an example is probably actually really positive for this conversation.

 

You have to look at it like, if I want to offer this to my clients, the first thing to do is do a cost analysis. How much is this going to cost? It doesn’t have to be PPC. You can do this with everything. Then you have to look at, if I’m going to keep this in-house, do I have the people to do it? Do my people have the skill level and do my people have the time to do this?

 

Then you just have to make the decision. If your people don’t have the skill to do it—which there’s a good chance in a lot of situations they might not. If you’re primarily a PPC shop, your design might not go out of generic landers. We’ve found that even ugly landers convert pretty well.

 

So your design might be extremely limited. To start off a boutique website design experience, that’s not something your people will probably have as a core competency in-house. You’re going to have to look at the cost of hiring because you need someone that knows how to perform the task.

 

Depending on what you’re hiring for—if you’re hiring a very skilled PPC person, which we did—it’s not going to be a cheap endeavor. That doesn’t mean you shouldn’t do it by any means, but you need to be realistic about the cost associated and say, “We’re going to get some training together or buy some consulting from someone who’s good at PPC for the guys that we already have and have them start running it.”

 

You’re rolling the dice. It can be a bit of a gamble. So you need to say, “Do I have the money to invest—the starting rate could be maybe $60,000 to $80,000 plus maybe some incentives per year—and to get someone in my office that’s going to be a wizard?” He’s going to be able to train people as we need to scale. He’s going to manage campaigns. He knows everything A to Z that has to do with AdWords.

 

AdWords is arbitrary. We could stick anything in there. Web designer, social media expert, whatever you want you can slip in there. It pertains and applies across the board.

 

Then you say, “What type of lead flow do I have for this?” If you already have a book of clients, you can just reach out and say, “Who would be interested in this type of service? Here’s the pros to it. We can get leads very quickly,” whatever. You can give the whole spiel, and you can generate some type of interest. Then you can say, “Hey, if this many people are committing to signing up with this program, does it make sense to hire this guy?”

 

I think that’s what you have to look at when doing that, because if you don’t have commitments, then you need to create an acquisition strategy to be able to justify bringing in the guy that’s going to be making $70,000 a year starting next month. For some agencies that’s a tough pill to swallow. That’s a decent chunk of change for a hire.

 

Having said that, depending on your geo, you might not even get someone that incredible. If you’re out in some parts of California, you might be looking at $100,000-$120,000 a year for a shark, someone that’s going to come in there and just crush AdWords. So that’s something to look at.

 

Then you need to say, “Can I find some type of company that will handle this white label, and I can just do it that way and I can arbitrage the service?” A lot of times what people do, which I think is extremely intelligent, is they’ll go white label first. As long as you have the white label company vetted—you trust their service, you trust they’re going to provide—go with the white label first. Then as you start to build the revenue, you can monitor the acquisition you’ve done for that specific product or that specific branch in the business.

 

Then you can say, “At this point we’re paying this white label company $8,000 a month in management—at what point does it make sense to bring that all in-house?” I think that’s a pretty intelligent way to do anything because you assume a little bit less of the risk. You’re not on the line for a $70,000, $80,000, $100,000 a year employee without the acquisition strategy or the revenue to back it up.

 

ROB: You mentioned that there have been some very important shifts in what should be expected from SEO. You can’t just wave a magic wand in a few months and rank for everything that you want to. What do you think expectations right now should be for what can be accomplished in what time for SEO? And what do you predict as the next couple of iterations of SEO? What’s it going to look like in 6 months, a year, 2 years?

 

MARK: I guess to tackle the first part, expectations should always differ depending on the KPIs you’re looking at when you hire an agency. There’s agencies out here that don’t do anything else besides build great content. In that case, your expectations should be a lot lower.

 

The deliverable is—it really depends on the agency and their strategy. If you have an agency that comes in and cuts the crap, if you will, and says, “We need to get links built, we need to optimize pages, we need to create some new content for a freshness factor and to push link juice around the site” . . . or what have you, it’s still going to take time.

 

I think a lot of it depends on if you go for a lower-hanging fruit strategy—which can be great. I always push people to look at things like this. For instance, let’s say a concrete company hits you up. They want some local SEO. (Mind you, “concrete” isn’t going to be a hyper-competitive keyword by any means, so this is just for discussion purposes.) You could go for the concrete construction company in Los Angeles. Los Angeles is going to be a little more competitive; there are a lot more companies gunning for those positions.

 

But something a lot of people miss when they start optimizing websites—and this can apply for local, this can apply for national, this can apply for e-commerce—the lower-hanging fruit can actually be some of the most profitable traffic they catch.

 

Instead of saying, “I’m going to rank this guy for concrete terms”—which obviously we’re going to have to do that, and that’s where I think a 3-6 month expectation in local markets is pretty reasonable. Then there’s always contingencies. Was the site hacked at some point? Which we’ve run into more than we care to talk about. There’s always contingencies. But if everything seems healthy and there’s not a complete technical overhaul that needs done, 3-6 months for those types of terms.

 

But when I start to dive deeper—let’s say we go into stamped and colored concrete. Stuff like that, even though it has a much higher ticket, a lot of times typical SEOs aren’t gunning for those terms like they should. These local clients get pushed through the assembly line, if you will. They’re pushed through the productized strategies to build links to this main page, make content, rank for their main term.

 

You start really digging deeper and deeper in and there’s overlay systems, there’s decorative overlay systems, there’s concrete curbing—which man, that stuff can be like $15 bucks a linear foot if you color and stamp it—you start to get into jobs where instead of pouring a $5,000 patio, your client could be pouring a $25,000 or $30,000 patio.

 

That works both ways. A lot of times you can get quicker wins, and you’re actually generating a higher quality lead for the client. That’s especially nice if you do the paid hybrid upfront too, where you can start to almost use campaigns for single keyword ad groups for those very specific higher dollar services. You can start to blow a client’s mind relatively quickly. [laughs]

 

But you have to keep in mind that for more competitive stuff—we took a personal injury lawyer in Louisiana. We took him and it took us about 6-7 months. Personal injury is pretty competitive. In my opinion, that’s one of the more competitive local query types you can go after. We’ve had personal injury lawyers who took us 14 months to crack that front page. There’s so many variables.

 

So the expectation—I think the biggest disservice people can do is say, “We’ll have it in this timeframe” just to close the deal. I think it’s important to really discuss with the client, look, we’re going to try to get you these “these” keywords that drive these higher quality leads so you can start generating an ROI on our service. But some of these queries, you’re going to have to have some type of patience. Especially big city big queries like personal injury, real estate, some surgery type keywords. It can be pretty wild.

 

As far as where we’re going, that’s an interesting question. We’re seeing more and more paid. I’m sure a lot of people already know this, but Google started rolling out its lead generation service. It’s like Google Home—I forget what it’s called, but they actually sell leads. It’s not AdWords, it’s their home service.

 

They qualify the business owner. They make the business owner do background checks on all their employees and submit the info. I think they even insure the jobs up to a certain amount. It’s Google Home Services, maybe. That’s a little scary, because they’re really monopolizing their traffic. They’re reaching that point. They started off doing Snack Pack ads.

 

I’d say the best thing if you want to be prepared is start learning and/or implementing some type of paid traffic using Google. Google’s prowess isn’t going to go away tomorrow. As much as we’d like to think they’re so big that they’re setting themselves up for a disruption, I don’t see a disruption happening in the next 2 years. I just don’t. Google’s just starting to offer too much. Their proximity-based search results got a lot better.

 

If you really think about the search experience you have on Google, in my opinion just over the past 3 years it got so much better. I use Chrome exclusively. In my opinion it’s the superior browser. You might have people using other stuff that are like, “Oh, he’s crazy.” [laughs] I’m just going with what I’ve seen. The proximity-based is great. It’s doing a lot better to map out places that are closer for you for your convenience.

 

I think we’re going to see voice search and that type of stuff be a lot more—I think when we optimize pages and sites, we’re going to have to think a lot more about voice search than what a lot of SEOs do. You can see some of the queries people speak or type or text-to-speech in, whether it’s in your Analytics or your AdWords and whatnot. It’s starting to get more and more specific and long-tail. As people demand Google to give them more specific and better results, you’re seeing some of the queries come in.

 

I think that’s going to be an interesting development. I don’t necessarily have a quick tip on how to do it. I think marketers are going to have to pay more attention than ever to Analytics. I’m rarely on AdWords lately, but I’m a huge, huge fan of AdWords. You can get the keyword data, like what people are searching to pull your ads. You can mine so, so much incredible data between Analytics and your AdWords data.

 

I think marketers are going to have to pay more attention to that than ever. Especially if you’re doing a broad match, you can really see some interesting queries that come in. They can give you a lot of great clues on how to modify the on-page for SEO purposes for user intent and whatnot.

 

ROB: Really interesting, Mark. I think I’ve been schooled both about SEO, and also you know a lot about concrete, which is pretty fascinating and maybe a whole other conversation.

 

MARK: [laughs] I used to work at two construction companies when I was a young buck, so I know the home service area pretty well.

 

And I have—well, I’m down to the low 90s, but I used to have over 100 dental clients, so I actually know more about dentistry than I’d even like to discuss. [laughs] And it’s starting to get like that with personal injury and mass tort stuff as well.

 

ROB: Amazon is also getting deep into that home services business, right? That’s part of where you could almost see—whether or not Google wants to be in that business, they almost have to be. You mentioned they’re not getting disrupted. Part of that is when you see someone like Amazon channeling so much of this local search type problem for local services, you can see them defending their turf there as well.

 

MARK: Yeah. Jeff Bezos is not to be messed with, man. Very powerful company. Oh man, yeah. I guess in terms of disruption, it was more like a nostalgic dream of some young guys in a garage creating something to disrupt Google. [laughs] But I get it. Amazon, definitely, they’re giants. Google, Amazon, Facebook, all giants in the space.

 

ROB: Mark, when someone wants to get in touch with you, when they want to find Local Client Takeover, when they want to find Web 20 Ranker, how should they find you?

 

MARK: I’m in the free Facebook group a lot. Obviously the Facebook group is free, but I like to push that it’s not—some people, if you join a paid Mastermind, you get a Facebook. This is just a group. We lightly screen; we try to make sure spam stays out. But if you just search “Local Client Takeover” on Facebook, we hang out there.

 

I haven’t been quite as active as I want to, but my partner Chaz at Web 20 Ranker—he’s also the cofounder, he and I founded that together—he’s in there a lot giving incredible advice. He’s probably one of the best SEOs I know. I guess I could be biased because he’s my partner, but I taught him a lot of what he knew years ago, and he definitely surpassed me a few times over. He gives great free advice in there. He’s always helping people.

 

But that’s a good spot to find us. The website, just check out the blogs. We have a bunch of content on the blogs. Really good stuff, in my opinion. Again, I’m biased. [laughs] It’s like, “Trust me, my stuff’s good.” No, but check it. It’s worth a read, I think.

 

It’s localclienttakeover.com and then web20ranker.com. There’s a lot of really great content on both blogs that go over tons of stuff. A lot of it is local-specific on the SEO side, but a lot of it can also be extrapolated to just about any SEO campaign you might run.

 

ROB: Got it. Thank you, Mark. Thank you for teaching us about concrete, about SEO, and a lot more. Thank you for your time.

 

Also a special thanks on this episode to Jake Tanner of Digital Hyve for this introduction. Jake was a great guest and he knows great guests. Referrals are always helpful. Thank you so much. And thank you so much, Mark. Great to meet you.

 

MARK: Thanks a lot for having me. Appreciate it.

 

ROB: Take care.

 

MARK: See ya.

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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