Why You Should NEVER Start Small (You Get the Clients You Ask For)


Being a white label agency, we hear people come in all the time saying

“I want to help small businesses who can’t afford the big companies” or “I sold a client for $150 to start to help them grow” or “What are your cheapest packages? I’ve talked to lots of different white label companies and none of the pricing works for me.”

Perhaps that’s you and that’s okay. However, I look to help you think a bit differently and help you build an organization you can scale.

How To Grow Your Marketing Agency Efficiently

a young plant growing

Let me simply share some wisdom from being in this business since I was 15 (yes 15, I was handed a phonebook and my dad had me start making cold calls). I’m 28 now and I’ve had the chance to consult with thousands of businesses and agencies to help them grow. I can help you skip a lot of the learning curve to help you scale your agency in a more efficient manner.


That! Company is the word leader in White Label Digital Marketing.  We deliver results for agencies large and small world-wide. Get answers to the question:What is White Label? and more about the services we provide.  We can help you achieve the results you deserve today!


 

It’s a very common ideology that “I’ll get clients in on a cheap price and then grow them into bigger clients.” The problem is (in my experience) lower cost clients always stay low cost. Even if you do an amazing job for them, a lot of the small businesses out there don’t have the same level of ambition to grow into a huge organization as you do.

For example, let’s look at the dental industry. I hear this all the time from agencies saying that they’re going to target dentists (can I just tell you now, that it seems to be an over targeted industry without a lot of upsides.)

Let’s say you close a dentist client for a low cost start up with the thoughts of helping them grow. Let’s say you are successful in helping that dental practice grow and the dentist’s calendar is constantly booked.

Now, here’s your chance.

You go to the dentist (or general manager if that’s your contact) and suggest expanding their contract with you to do even more. I mean, after all, that only makes sense. You’ve helped them become successful, they want to be even more successful and have you do more, right?


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Well, unfortunately, that’s often not the case.

Here’s the response you’ll likely get “Well the dentist’s calendar is always really booked, I’m not sure we could handle any more business, so we’re better off just keeping things as is… Actually, now that I think about it, is there any way we can reduce our marketing budget to cut our costs?

What?!

All that hard work and now they want to reduce their investment with you. This scenario is far more common than you might think and it’s not limited to the dental industry.  If you start small, people will expect you to always charge small.

Now, I will give you one exception, and that is if you charge a high hourly rate and give only 1-2 hours of your time to a customer, at least your time is being valued properly.

The Importance of Scalability with Your Company

If you come in charging a $25-$50/hour rate, why would they ever pay you $75, $100, $150, $200, $450 an hour? Experience? While yes, you have gained experience, it is uncommon for a company to start paying a higher hourly rate for your service than when they started with you (not impossible, just uncommon).  It’s more likely that you’ll expand your contract to include more hours (if they can take more new business that is).

At a minimum, if you’re going to start small make sure to value your time. Beware, however, when a client purchases your time, they don’t usually care what your contract says, they’re going to ask for as much of your time as you give them, so you must put your clients in their contractual “box”. Otherwise, you’ll find the $150 a month account you sold is taking 5 hours a week to manage just because they keep calling you. man walking in a suit with a city scape behind him

To truly scale an agency, you need to think about valuing your time around $150 – $250 an hour. That might seem like a high rate, but when you think of all the costs that go into running a true agency (not just being a freelancer) you’re going to need it.

If you want to hire people (or hire a white label agency), pay for marketing costs to acquire new clients, pay for a building, electric, water, internet, servers, etc. as well as make a profit so you can make money as the agency owner, then you are going to need to start thinking bigger.

So, with that said, if you still want to target small businesses that is perfectly fine, but you need to still charge a $150-$250/hourly rate for your valuable time and deliver high quality work and build processes for efficiency.

If you intend to hire people to do the work (whether hiring internally or by hiring a white label company like That Company) then you really need to intend on going after accounts that pay $1000 – $2000 a month.

Most new agency owners don’t consider the long-term when they sign up small accounts. Sometimes they fail to consider that they really won’t be able to make a profit in the future when they hire someone who is experienced to manage it without the agency owner having to invest their time as well.

Remember as you build your agency one of the most important goals to achieve is that an agency should be able to run without the CEO being involved in the day to day management of clients. This is why the traditional white label model doesn’t work very well anymore in this industry. Traditional white labels used to only do the work and not talk directly to clients. In this model, it requires the agency owner to do all the client interaction which means you can’t focus your efforts on scaling effectively or you have to hire project managers which eat into the agency’s profits.

If you’ve read this far, you might be thinking, But I don’t have the credibility or skill set in order to close big clients yet! I need to close the small ones and work my way up to the big ones. Well, That Company has created a solution to tackle that exact problem for startup agencies.

Partnerships That Profit

a stack of coins on a desk We provide two effective options:

Option 1: You can continue on the standard path and sell for lower prices to start with, do way more work than you’re paid for, and end up with a successful case study on a small company.

or

Option 2: You can sell a $2,000 – $10,000 a month retainer, get paid, not have to do very much hands on work, and end up with a case study on a large company which provides you with even more social stature for the future.

How is Option 2 possible?

With the assistance of That Company’s strategic partnership program, you can accomplish option 2. I call it “the agency startup cheat code”.

What we suggest you do after becoming a strategic partner is using That Company’s credibility as your partner when you go into a large opportunity. We have 12+ years of experience in the online marketing industry with entire teams of experienced consultants and coordinators, as well as previous successful results to build confidence in your potential client. I mean we can say things like google “solar panels” see the customer in position #1, we helped them. If we can achieve these results in a competitive industry, we can definitely help you and your potential customers.

When the deal closes, you will receive a 15%-20% lifetime commission on the deal, and you now have the opportunity to build a great case study on a large company that will find the way for eventually managing customers of that size in house.

Let’s do some simple math.

20% of $5000 is $1000 a month and you don’t have to do any hands on work each month. That’s a lot more than selling a small customer for $150-$500 a month and doing most of the work to end up with a case study on a small company.

If that sounds like an interesting solution to help you build your business and scale a digital marketing company, you should give us a call! 1-800-255-0396

Authorship: Michael K.

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