Flip the Switch Episode 7: Interview with Grayson Lafrenz
SOPHIA: this week on Flip the Switch. We have our very first interview with CEO and co-founder of Power Digital, Grayson Lafrenz in which we discuss the importance of sales and relationship building amongst your clients and colleagues. We also cover Albertson’s investment in e-commerce as they watch sale skyrocket. The frightful 5 killing your start-up and Amazon in cahoots with Bitcoin. Let’s get into it.
00:58 AUSTIN: Welcome to Flip the Switch presented by Power Digital Marketing. I am very happy to be back. I missed you guys on Monday.
01:05 PAT: We missed you too Austin. That was something that I was going to bring up right away. Austin somehow crawled his way out of his bed. He’s not sick anymore. He’s able to join us again. We have the full team ready to deliver a great episode to you all.
01:16 JOHN: There’s a little bit of remnants. I can still hear the sickness, so I’m going to sit a little bit further away from you today.
01:20 AUSTIN: Yeah, my voice is still a little bit husky, but a friendly reminder out there. Take your vitamins because something’s going around.
01:24 PAT: Kind of wish I’d called in.
01:27 AUSTIN: All right. But yeah, as you said–very happy to be back. And we’re very excited for today’s episode. It’s our very first interview. With did it with our CEO, Grayson Lafrenz of Power Digital Marketing. He answered some really great questions about sales and how Power Digital came to be. And then we talked a little bit about what we learned from him. And how we apply that day-to-day. So you guys are definitely going to want to stick around for that one. And, you know, this first interview was a segue-way into we’re going to be doing a lot of interviews coming forward. So we’re really excited about this being the first one and the beginning of something really great.
01:57 PAT: Yeah, absolutely. Grayson–again, not to give too much away–gave us a ton of great insight about not just building a business, but effectively managing people. Doing right by people and having that translate into business success. I think you guys are really going to appreciate it.
But first, as always, we have our business news and trends.
02:14 AUSTIN: Yeah, let’s hop into a little bit of news here. So we’ve been talking a lot about the delivery services that companies are doing straight to your door. And Albertson’s is no different. So the chain is now doing in-home deliveries and they saw sales rise 19% due to home delivery in this last quarter.
02:34 PAT: Yeah, so we’re reading this article off of Supermarket News, which is basically a trade publication for the supermarket industry. And they’re reporting that revenues before this Albertson’s had dropped .2% down to 13.8 billion and in-store sales were falling by 1.8%. And this was a 4% decrease in traffic. A bunch of statistics about it.
Basically, the gist of it is that metrics across the board were kind of down, and so Albertson’s was forced into a situation where they had to pivot. And they kind of deemed that the best way to do that is to really start to lean into their e-commerce. And we saw that, of course, really start to pay off for them in a major way.
03:10 AUSTIN: Yeah, just like Walmart where we see switching their dollars to spending on e-commerce. They’re doing the click and collect offering as they call it. Where you place your order and they bring it straight to your house. So this focus on e-commerce is definitely creating a trend of upward revenue for them which they’re obviously very excited to see. After that downturn in the beginning of the year.
We also see them making investments in a company called “Plated” they just bought for 125 million dollars. And my understanding is this is something on the lines of door dash or anything like that so that they can deliver you a very unique meals straight to your door.
03:46 PAT: I think the most unique part about this whole article that we read to is that they’re seeing a growth in their private label products. And so what that means is Albertson’s is somebody that also practices vertical integration. They have a manufacturer that they bought. So they’re not reliant on providers as much. They can create their own products that mimic those of the marketplace.
And in doing so, they limit overhead, so their margins are going to be innately better when those products are sold. In-store, private label products really don’t do that well. But what we saw on e-commerce is that they saw a rise in those products, and since their margins were higher, they’re able to start to recoup some additional revenue on top of just what they’re innately going to receive because of the convenience factor that we’re talking about.
04:28 AUSTIN: Yeah, and actually just to correct myself. This is actually something like “Hello Fresh,” or “Blue Apron” where they send you all the ingredients and then you get to prepare the meal at home. So they’re doing this… they’re doing an integration with their app so the Albertson’s app will allow you to either order the food straight from them if you wanted dinner for your family. Or you could use the “Plated” side of it, where they’ll deliver the ingredients for the meal, so you’re getting that more of a wholesome approach to your shopping. And then also that meal prep.
So the integration of those 2 is definitely rising as people are looking for ease in how they consume food products. And they’re definitely stepping away from going to the store and looking more for the delivery at home.
05:07 PAT: Yeah, and again, this couldn’t have come a moment too soon. Through the first half of the year, Albertson’s was reporting losses of 560 million dollars on a revenue increase of .1%. And a year ago, that loss was only 371 million dollars. So they’re starting to lose money at a pretty rapid rate from their current practices. They’re upper level management got together, decided that digital was the avenue for them to go in. And now they’re starting to see it… their recouping some of their losses year over year. So again, Austin. Kind of like you were just talking about. This goes back to considering the consumer experience first. That convenience play. This is something that Amazon perfected. Something that Walmart is dabbling with as well.
And I think this could pay off very well for a supermarket chain that quite frankly, just wasn’t doing well before.
05:46 AUSTIN: Yeah, this vertical is getting very competitive and it’ll be interesting to see who wins out. Will Amazon hold onto that? Or can Albertson’s make a little bit of a push themselves.
All right. Segue-waying into our next topic. We’re doing the frightful 5 versus start-ups. This is off the New York Times and we’re talking about the major tech companies, such as Google and them and how they’re crushing start-ups or acquiring start-ups.
06:09 PAT: Right. So the frightful 5, if you’ve ever heard this before, this is actually an article that we’re referencing from the New York Times talking about the frightful 5 being Amazon, Apple, Google, Facebook and Microsoft. No huge surprise there. Kind of the dilemma that they’re talking about though is that the dominance of each of these respective companies within their industries and spaces is saturating these markets to the point where start-ups re suffering as a result. Think… I think one example that they called out in this article was an integration… it was something that Facebook actually ended up purchasing though. These companies are coming about. They’re finding these niches that these big companies aren’t able to fill. And then as soon as the company becomes financially viable, a big company makes them a very handsome offer. Oftentimes for more than they’re really supposed to be worth. They give them a crazy valuation and then end up acquiring them so they have those services and the right to the IP.
07:03AUSTIN: The big difference now that we’re seeing… IBM was large back in the ’80s and very, very huge. And a company like Microsoft came into the picture and said, “We’re going to steal their market share away. We’re going to be a better company. We’re going to compete directly with this giant and we’re going to take away their customer base.”
Now a start-up is saying, “We can’t compete with Google. We can’t compete with Amazon. But we can get bought out by them. So let’s make a really great product. Let’s get funding from Silicon Valley and then let’s make a really great product that’s just going to get eaten up by these monsters. Because there’s nothing we can do to defeat them.”
07:38 JOHN: Yeah, and a big example of that… of somebody that made a mistake and not to bring this up again. Because we always talk about how they’re dying and have made horrible decisions.
Snapchat.
07:49 AUSTIN: Knew it.
07:48 JOHN: Snapchat. Snapchat got that offer from Facebook. Totally was on the table for them to take and make a billion dollars…
07:59 AUSTIN: Man, we really dog on Snapchat
08:00 JOHN: We do. Yeah, no. They had that offer and they screwed that up. And then what did Facebook do? They bought Instagram and put that same technology into Instagram. Which is now what we talked about 2 weeks ago, 3 weeks ago. So, yeah…
08:13 AUSTIN: It’s scary the price you pay if you try to compete with them now. They literally just look for another technology company that does what you do, and integrate it into their product offering and just put you out of business. And that’s what we’re seeing with Snapchat.
08:24 PAT: And I think it’s just an interesting sign of the times that the whole Silicon Valley dynamic is being affected by this too. There was once a time where these companies were those start-ups filling those niches within predominantly traditional markets. And as time has gone on and the technology that’s behind these companies is just so robust and constantly changing and improving in that sense. They’re not going anywhere. They’re not dwindling. They maintain purchasing power and they can acquire these companies that really aren’t filling any needs anymore.
08:57JOE: I feel like the focus of start-ups nowadays is you’re not trying to become the next Amazon or the next Google. You’re trying to build up your start-up to a point of where you’ll get the offer to get bought out. Cash out and just retire at a young age.
09:07 AUSTIN: Yeah, that’s what we were saying at the beginning and you nailed it. That is the point of these now. If you can’t compete with them, you might as well just become them. It’s still a great payday for you if you come up with great technology and these companies buy you up. Then, hey, you just won.
But you know, I think that these companies still have that start-up mindset. In that they are just the large ones, like Google… that they are just scraping. Gotta stay alive no matter what.
09:31 PAT: constantly innovating.
09:32 AUSTIN: Even though they are the largest they have to continually, constantly innovate. And they’ve kept that mindset. And that’s what’s grown them into just the largest companies in the world. Such as Apple and Google.
09:41 PAT: And the reason that these big companies have that mindset is because they were once in the shoes of disrupters in the space. So they’re constantly innovating because they’re paranoid. They understand that the possibility of somebody coming in and taking them out does exist. However unlikely that is now given their size and stature.
But it exists. And the reason that they know it exists is because they were once those people.
So again, very interesting stuff here. It’ll be interesting to see kind of how this all goes. The frightful 5 are definitely be going anywhere, but, as always, we will be reporting their progress back to you and how it pertains to current business events.
The next piece of news that we want to go into here… and again, this is going to be kind of for Austin a little bit. Our resident Bitcoin expert. But rumors are coming out on a bunch of crypto-blogs and things like that talking that Amazon could end up accepting Bitcoin as a currency of sorts. Is that right, Austin?
10:33 AUSTIN: Yeah. So typical Amazon. They’re actually looking to compete with… so Overstock was the first mover in one of these major retailer–online retailers–that accepts Bitcoin for product. And Amazon being who they are, they want to step into the space too. And they’re seeing this as a major opportunity to take over a large amount of market share. And if you’re Amazon and you’re accepting Bitcoin for product, that is incredible, right? Because that has the potential… that product that was maybe selling for $29.99 in that equivalent of Bitcoin now. But if they’re expecting Bitcoin to rise you just made a return of upwards of 2X, 3X selling a product for 30 buck.
11:10 JOE: So essentially instead of accepting your cash for a purchase, they’re going to allow you to give them a bit of your investment just to keep growing your portfolio?
11:19 AUSTIN: Right. You’re pretty much exactly right. So now you’re playing directly into the investment side of a company where typically that would be revenue. So that is a very different way… how consumer acts with the company now. We’re seeing now because of the hybrid nature that is crypto-currency and specifically Bitcoin. It doubles as a currency and also as an investment vehicle. So that, in itself, is very new to a consumer base. And also, very advantageous for a company such as Amazon.
11:45 PAT: And it goes back to a lot of what we report on with Amazon. I remember when this story came out, Austin and I were talking with one another, saying, “Awesome. Two of our favorite subjects–Bitcoin and Amazon–together in the same story. We have to talk about it.’
But it’s true. And it really kind of gives some credence to the conversations that we’ve had the last 2 weeks. In our, “What is Amazon taking over this week?” segment. We talk about Jeff Bezos’ competitive nature. The fact that Amazon has the power to get into almost any industry that they want and getting into cryptos and investing in crypto-currencies is just going to make that price go through the roof for Bitcoin, because it’s like an added vote of confidence by an established, credible company.
12:22 AUSTIN: Yeah, so look for this news. There might be an official statement on October 26th, which is today if you’re listening. So that could be coming out today from Amazon. And also the price for Bitcoin is already on the move upward because of this rumor. And if it does hit, we’ll probably see that go up. And then there’ll probably be a big drop after as people profit off the news in itself. So look for that to come through. It’ll be very interesting to see how Amazon handles Bitcoin and how they make that accessible for consumers.
12:52 PAT: All right, everybody. That wraps up our business trends and news segment. Now we’re going to be moving into an interview with our CEO and boss Grayson Lafrenz around sales, marketing, and everything business so enjoy.
13:08 AUSTIN: We are very excited to welcome our very first guest on the show–Grayson Lafrenz, CEO of Power Digital and our boss. How we doing Grayson?
13:15 GRAYSON: Doing great guys. Awesome to be here with you. It’s been fun listening along and it’s an honor to be the first guest on the show.
13:23 PAT: Hopefully first of many. Yeah, I know this is one we’ve been looking forward to for a while. There’s a lot of questions that we have for you in general, so really excited to kind of get into it.
Before we get into things that are a little bit too specific though, I was just wondering if you could give us a little bit of insight as to your background and kind of how you got to this point in your life. Like, how did you get here?
13:43 GRAYSON: Yeah, for sure. So I’m born and raised here in San Diego. One of the few natives around. Went to La Hoya High School. And then I went off to college at the University of Arizona in Tucson. And then basically upon graduating from college, wanted to be an entrepreneur. And so came out of college, had written some different business plans. Thought it was going to happen and this was about 2007. And I got the rude awakening that I knew very little. Although I thought at that point in my life I knew a ton, I found out that I did not.
And so I got pointed at that point by some family friends. And kind of advisors that I had. To develop a skillset. And one of the skillsets that I was told would be most relevant to being an entrepreneur and building a business and growing was in sales. And so I got pointed to a company called MRC, who at the time was the biggest agency of Xerox in the world.
And kind of the rest was history. I went and worked there. And was really lucky. I actually had an initial boss who was okay. And luckily, one night, he went a little bit off the hinges…. and actually back in the day in sales there’d be a voicemail where they’d go and they’d leave a voicemail if you got a deal. And this manager of mine left a pretty obscene company-wide voicemail.
15:07 PAT: No way.
15:08 GRAYSON: And that was kind of the end of his career. And so the CEO tapped the SVP–this guy, JT was his name–tapped him. And so I think a month into the job I had the main guy as my boss and mentor. And I just learned a tremendous amount from him. And so that’s kind of how I got my foot in the door in business and starting in sales. And from there ventured off into a couple different entrepreneurial ventures. To SAS companies–Software as a Service–businesses. And then went in the manufacturing space. Had some small wins with those and some losses and disappointments as well. And then basically we founded Power Digital and it’s been a great run since then as you guys know. So that was in 2012. And we’ve been able to grow about 100% every year since then. And you guys know that story and have been a huge part of that.
16:05 AUSTIN: Yeah, really exciting to hear that whole story and it’s really interesting to see where you’ve arrived at. So you really harped on the sales aspect of this and that part of your background. How has that influenced your ideas for this entrepreneurial ventures and Power Digital as a whole?
16:18GRAYSON: Yeah, so, great question. I mean, it’s interesting when thinking of sales. I don’t even really look at it as sales. I look at it… I mean, that’s what it was when I started. But I think the connotation that people have around sales is a really bad one. I think you think of somebody trying to force you to buy something and whatnot.
My perspective is much more consultative in that it’s trying to help people figure out what their problems are. And then how to solve those problems.
So I think it comes down to whether it’s the product. Whether it’s looking at a specific business segment, but how… what are the issues that these people are facing? And then really, how can we help them solve those problems?
17:02 PAT: It’s a really interesting approach to take. I know that coming out of college, I definitely had a little bit of that connotation of sales. But seeing the consultative approach firsthand has definitely kind of changed my perspective on that a little bit. And kind of tying back into that… kind of that consultative nature. What part of the business do you think is the most important in sustaining long-term growth? Is it kind of the consultative piece that you provide in the sales process and through some of the services? In your experience, what has that been? To sustain good growth?
17:30 GRAYSON: Yeah, you know, it’s a great question. I don’t know that you can put your finger on one piece that’s really critical for sustaining long-term growth. I do think that there’s kind of 3 key ones. And so the first one is just the people. You know, it’s like in a business you’re building a team. And if you have the best team and the best talent and the most driven, kind of unified people, then it’s a lot easier to win.
And same thing goes with turnover. So if you’re constantly… if your star players are constantly leaving you, you’re not going to have that synergy. And it’s going to be difficult to have chemistry and win.
So I’d say number one is building that great team and keeping it together.
And then number two is all about the customer. And I think churn rate is a really critical metric in any business. If you’re just constantly turning over customers and you’re just chasing your tail and you’re hemorrhaging clients and so even if you’re adding new clients, you’re not taking those steps forward. Then it’s very difficult to sustain and to grow.
And then obviously the third is just the customer acquisition. If you want to grow at a really rapid rate, you need to have a really clear path to get new customers. And to do it in a profitable fashion.
18:44 PAT: That’s definitely interesting to hear, too. So sales, definitely is part of it. But it sounds more just kind of like, investing in the right people early on. Making sure that they have opportunity for growth so they’re happy with where they are. And then obviously the customer… would you say they take precedence over the client acquisition side of the equation? Or how would you rank those in order of importance?
19:02 GRAYSON: Yeah, I think it varies. In my experience it’s a lot more profitable to keep a current client and to grow the client than to try to get a new client. And obviously it depends on what business that you’re in. but I remember this mentor that I had back in the day used to always tell us, “Same client, different product.” And so instead of just focusing on new clients–which is one way to grow revenue and more profit. if you can just do a great job with your current client and then offer them different services and then grow what you’re doing with them… it’s typically far more profitable. And I know you guys have all seen that first hand at Power Digital is we get our foot in the door with a new client a lot of the times and typically that first contract is small. And we’re doing a ton of hard work for a small amount of money. And then as we prove ourselves and grow, next thing we maybe go from a $6,000 a month’s partnership to a $60,000 a month partnership. So I think that the current customer base comes first always. And then just finding the right people to add to the mix.
20:04 AUSTIN: Yeah, you’ve definitely done a really great job of adding the correct people to enter your system. And then stay here for a while…
20:09 PAT: Not that we’re biased at all…
20:12 AUSTIN: Yeah, not to say as Pat and I, Joe and John and I have been here for a while and we’re loving every second of it. And the people you’ve chosen to be alongside of us are phenomenal. So what would you say is the key component of the traditional sales that has led to your being successful in selling digital marketing?
20:29 GRAYSON: I was thinking on that, and that’s a really great question. And, you know, first thing I’d say is I think what everyone thinks of in terms of traditional sales is really dead. I think of traditional sales as the guy on the phone and he’s cold calling you. And he’s trying to sell you something. That’s dead. I think for a couple reasons.
One is nobody answers their phone these days. And when they do–at least me personally–it’s typically cause I think it’s somebody that I want to talk to that’s calling me. Like, most people, if it’s a number that you don’t know on your phone, you’re not going to answer. They’re going to text you or leave a message. And if you do answer it’s cause you think it’s somebody that you want to talk to.
So I think that that’s really dead. It’s funny because back in 2007 I remember I would never have thought that would be the case. That type of prospecting was so critical. But it’s changed.
And I think the biggest thing that’s changed is that consumers are so savvy and prospects are so savvy and there’s just so much media and information out there, that people want value in advance. So you have to give them some sort of value in advance.
And so I think, you know, traditional as a whole is dead. Where I think it kind of parleys into digital is online sales and offline sales, they’re like identical. They’re almost identical. The fundamentals of them are the same in that you have to kind of know where a prospect is, and there’s this funnel in terms of… A lot of times they don’t even know that they have a problem at the beginning of the sales cycle. Whether online or offline. So if you can be the person to show them that they have a problem. And then show them that a solution exists out there. And then, finally, show them that you’re the best person to provide that solution. It’s the same exact process.
I think it’s harder to do online because offline you can talk to somebody. You can look them in the eyes. You can build that rapport. And to do that online, their attention span is typically a lot shorter. And it’s a lot easier to shut down a webpage than to tell somebody that you don’t want to talk to them when you’re standing there.
22:31 AUSTIN: so you talk a lot about the relationship side of getting prospects. Would you say that cold calling is on its way out? Or what percentage of your new business is coming from cold calling?
22:41 GRAYSON: yeah, so I think… none of our business is coming from cold calling really. And I think cold calling is on the way out. I got a call just the other day–this guy called Power Digital and I answered the phone… it came to me and I answered the phone. And this is the type of thing that I see these days. First of all, I didn’t want to talk to the guy. But I was being nice to him. And he didn’t ever ask who I was.
He asked to talk to Austin Randall who’s our paid media guy. And then when I asked him what it was in regards to, he goes, “yeah, your guys’ CEO told me to talk to him.” And I was like, “What are you talking about?”
And the guy had just clearly lied to me and was trying to manipulate the way through. And, first of all, there’s no way for me to even put him in touch with Austin Randall cause like Austin Randall has a cellphone. He doesn’t have a phone on his desk.
So I think that’s just one example. But what I’m seeing more is like the modern day cold call is more through email. And I think the value of that is if somebody writes a really compelling title to an email, I’ll typically look at it. And then if they hit you with something that’s really interesting a lot of the times I would forward along to Austin Randall and say, “Hey, check this out. This is of interest.” or whatnot.
So I do think that there’s a play there. But with that said, I mean some of the emails that I see these days–they’re just ridiculous. Like, they’ll send you an email every day. “Hey, don’t know if you had a chance to look at the last one…”And it’s like a string of like, 7 of them. And it’s like, no, I haven’t looked at any of them. Cause I don’t care. What you’re emailing me about isn’t interesting.
24:01 PAT: Yeah, I was actually just thinking on that the other day. And it’s pretty interesting that you go from an era where you’re trying to… at least the way I associate traditional sales is like, you’re kind of sweet-talking the customer a little bit. Trying to ease them into a situation where you can provide some value to them.
Whereas with online, I think it has to do a little bit with the age of immediacy that we’ve talked about before. And kind of like the instant gratification era that we live in. The burden is on the salesperson to provide value right away. And I think it’s a very unique situation.
It’s clearly something that you’ve seen as well. Kind of on that note too… providing value immediately… as a company we specialize in online marketing. I’ve always kind of wondered what’s a way to market yourself whether that be trying to become a thought-leader. Or whether it’s trying to establish credibility with a client. How do you market yourself without being too “promotional?” which has turned people off in the past, even in the traditional sales setting?
24:59 GRAYSON: Yeah, I think it’s really hard these days. And it’s interesting because we’re in digital marketing and I’ll talk to people in the business community. I’m sure you guys get the same. And I think everybody wants… if you’re a BtoB business, everybody wants to cheat. They’d rather… they’re like, “Oh, I want to do it through digital marketing. How good does that sound? You do some stuff on the Internet and all of a sudden you start getting a bunch of customers and traction.”
In my experience though, and obviously it kind of depends on your business model. So if you’re marketing BtoB and you’re a software as a service business and you’re selling a 15 dollar per month product. Versus if you’re selling like us. And maybe like our average deal value is $100,000 the way that you can market and sell is super-different.
Because how much time can you really spend if it’s $15 a month subscription? If you’re having to have multiple calls with the prospect to sell that, you’re probably not going to be very profitable.
But in my experience, kind of no matter what… offline sales needs to happen first. So very, very rarely can they just do online, digital marketing and get that kind of critical mass that’s needed. So typically they have to rely on offline. They have to get that initial user group. With offline sales you also learn a ton about your prospect. Because you’re not having to just look at data to try to understand and test stuff. You’re actually having a conversation. So you can see what they’re responding to. You can see what they’re not… you ask them the question.
So I definitely think one of the biggest mistakes that businesses make is they want to dump a bunch of money into digital because it’s easier and there’s less direct rejection there. When they should really be leading and getting the foundation built with traditional sales. Offline. And then they can dump digital on top as like the gasoline that will just get that fire really burning.
26:46 AUSTIN: Mm-hmm. Yeah, that’s really interesting. And we keep coming back to the point being that the relationship is truly the key in sales. That has translated from traditional sales into digital sales where you still want people to think that you care about them. Even though it is an online setting for our product. It’s very important for you to connect with them on their business sense and on that personal level.
So let’s switch over to talking about the people aspect. You brought that up earlier and we’re interesting and I’m interested in how have you prepared those around us to be more sales oriented, like yourself?
27:18 GRAYSON: Yeah, so that’s a great question. I think what we’ve done is just really given people the opportunities to make mistakes. And so with sales, a lot of times, there’s a script, maybe. And there’s certain components to prospecting which is part of the sales process. But when it comes to kind of running a sales cycle, repetition’s really critical. And even people developing their own style is really critical. So I think the biggest thing that we’ve done a good job with in terms of that regard, is teaching people to ask great questions. And then to listen to those questions.
And that’s what it comes down to. The best salespeople, they ask the best questions, and then they really listen. Because maybe 50% of the time the answer is not… it’s bullshit… it’s not what they mean. It’s just the easy thing for them to say. So they’ll listen and they’ll ask that secondary question. And they won’t just take that initial response for it.
So I feel like that’s been something that we’ve done a really great job of.
The second is just giving them the confidence. So giving them the confidence to go for it. To ask for the order. To get rejected and realize, “Hey, that’s great.” You need to get rejected. Especially a guy like Pat, he’s really used to getting rejected. Very used to it.
For some of us, it’s a newer deal. So just making people realize that that’s okay and that’s part of the process.
And then lastly I think one really critical thing for organizations these days is if you can have every person in your company be a brand advocate and a salesperson? What a huge advantage you have. And the first step of that comes down to compensating people to do that. Even if that’s not their core role. You don’t want your marketing guy, who’s supposed to be doing SEO out there trying to cold call prospects all day. But if he’s motivated financially to spread the word and to network on your behalf. If he can just bring one prospect per month, that can have a really big impact on the business. So I think that that’s a really key thing for companies to think about as well.
29:12 AUSTIN: yeah, absolutely. Something that I was thinking about that I’ve learned from you and those around me is how to cross-sell of upsell in the sense of looking between the lines of what a business needs. I do SEO and I provide keyword mapping and on-page optimizations. But they might need links. That might be a missing component to their SEO strategy or their business strategy. So I know that the resources is there in the company and we’ve learned from you, use those resources. Think outside the box in terms of what’s in the schedule. What we’re currently providing for the client and see where you can provide them value outside of that because that’ll make their business stronger and help our business to continue to grow.
29:47PAT: it’s actually… it’s funny that you bring that up too because it ties back to something that Grayson was saying. And he’s talking about how when you’re speaking with somebody for the first time and you’re asking them questions, a lot of people don’t want to have the wrong answer. So they’ll give you the easy answer. It’s a matter… if I’m hearing you correctly… of reading into what might be underlying motivators for that answer. And then, from there, you can draw up a strategy that makes sense, provides some worth for this client. Really shows them that we can be an extension of their team.
And then, from there, you know, what kind of pivots might be down the line ahead of time. Which limits further planning and things like that and will only kind of help their business grow. So I definitely think that’s one aspect of the sales prospect I think we can all agree is a good part of it.
I’m curious though, Grayson, somebody who has started his career in sales and has really kind of been in that arena for a good amount of time in addition to a few other things… what would you say you like the most about the sales process? And then conversely, what do you dislike the most about it?
30:44 GRAYSON: Yeah, I think the likes are pretty easy for me. It does depend on what you’re doing. You know, so each sales cycle’s different. But what I like a lot about what I’ve gotten to do in sales is typically it’s more on the business consulting side. And it’s just really fun to get to talk to a bunch of different business owners and learn about the things that they’re kicking ass on. Learn about the frustrations they have. Learn about their business model. Really just get to see the inside workings of their company. So especially as a digital agency, people hire us to drive more revenue and make more money. And so having the opportunity to really get into the weeds of how that’s going is really fun and just keeps it very interesting.
And then I think for any person in sales, the thrill of getting the deal and closing the deal is just really fun. It gives you that charge and I don’t know if I know anybody that doesn’t like that feeling.
I think typically the “dislikes” for most people are kind of more around rejection. For me, I think what I typically dislike more is just rude people. So when you’re working with somebody and their trying to act like they’re too good to be working with you, or you’re lucky to be talking to them.
Also people that try to hold back info. We’re trying to help you and you think it’s like a poker game. You know, a typical question would be, “Hey, you know, what is your budget or what is your goal?” And people… they don’t want to tell you. They think it’s like a negotiation. But in reality, if you don’t have the information it can be pretty hard to help people.
32:20PAT: Right, it’s not like you’re going to leverage that for anything except for trying to help them. So at the end of the day, it’s almost that they’re hurting themselves in that scenario.
32:28 AUSTIN: So, I think we’re interested… you talked about what you like, what you don’t like and then the personal traits that will get you that new business. But do you have a formula for attracting new business at this point? Now that you’re more an established business, what has gotten you the most leads?
32:45 GRAYSON: Yeah, so I think it varies for each business. For me personally, one thing I’ve realized… and it works for marketing too. Online sales or offline. If you have a one-to-one relationship with how you attack kind of prospecting it’s really hard. It’s going to be really hard to make that profitable.
So if you can have a one-to-two or one-to-three type of relationship, it makes the numbers really work for you. So what I mean by that is the first… in the early days it’s going to be one-to-one. You need to get those initial customers. But with those initial customers if you do incredible work then the one-to-one becomes a one-to-two or one-to-three because they begin to refer other people to you and spread the word. It all really just falls into the right place.
So I think the first thing is just get those initial customers and get that critical mass. And do incredible work for them. And turn them into brand advocates. And a lot of times you have to actually ask them to become a brand advocate. You need to tell people in business how they can help you. Even when they’re ready to help you, they typically don’t know.
So I’d say that’s number one. And then two is just do good by people. So, do other people favors, take care of them. Be a connector. Don’t ask for something in return for all that. But if you do that it always comes back around. And so I think that comes down to kind of networking and whatnot. But not, like, I’m networking with you Austin and you’re the guy I’m trying to kind of sell. You’re probably not. The room of people I’m probably with is probably not my ideal client. But they all probably know people that are. And so if I can find a way to help them and make it worth their while, that’s a customer base I can tap into.
So I think in the early days, that’s the key. And then I think the digital marketing starts to work. So Power Digital for example, that was pretty much our formula to success for the first couple years. Doing great work. Getting those initial clients and then growing like that through referrals and partnerships. And then about 2 and a half years in we really started to investing in marketing. And so you guys have been a big part of that. Just trying to create as much awesome content as we can. And give away those secrets, and give away those resources. Giving that value in advance. And then just now it’s starting to pay off. So now we’re at the point where we get 10-15 leads a day through the website. And it really works.
But if we’d tried that from day 1, I don’t if we’d be here still today. Because that would have been a pretty expensive path and we wouldn’t have been profitable in that regard.
35:16AUSTIN: Those are some very good points you made. And it’s really interesting from an employee to employer standpoint to hear your… the ideas you came up with in the beginning and then where we’re sitting today. It’s really wonderful to see how you’ve made that all work and brought that to all of us. So, you know, taking away from here I think to harp on it again is the relationships. So you’ve worked on doing well for your original clients and then that has translated into additional clients because word spreads. Just as in every business, in every industry. Regardless of digital or tangible… it will be based on if you are treating people correctly.
35:51 PAT: Yeah, and I think another big takeaway that we kind of just had that’s carried over into how he conducts his day-to-day business here. And we see that first hand, but you’re investing in the people. You have a genuine investment in their well-being. And if you do that with your clients and your own people, you’re really in a position where you can grow the business on both of those aspects. Both internally and with clients.
36:14 JOHN: Just another quick question…just off the top of my head. What’s your favorite industry right now to work in?
36:21 GRAYSON: Favorite industry to work in. you know, I don’t know if I personally have a favorite industry. It’s interesting, what I love is… one thing we get to do in our business as a digital agency is we’re looking at people’s sites and their brands and their companies every day. And so we have people that want our help and we get a look at their brands and sites.
I don’t know if it’s an industry per se that I would love. But I’ll see from time to time, just a company that has so many amazing things. But they’re just really kind of missing the mark on stuff from a digital marketing perspective that we can really easily dial-in for them. And by doing so it’ll be just crazy growth for them. So I think that’s more what I get really excited. And, you know, when I see one of those sites and I’m working on a deal like that, you just have that energy. You’re like, “Ah, we need to get this done because we’re going to make these guys so much money. And they’re going to win big. And as a result, we’re going to reap some of that reward.”
37:20 JOHN: Right. Okay.
37:21 PAT: I actually…I have one more quick one as well. So a lot of our listeners are people who are interested in management. Business overall. Let’s say you’re talking to me 3 years ago. Right? Pat, the intern let’s say. Actually that’s a perfect example. Let’s say you’re having a one-on-one with Pat the intern. What is one piece of advice that you would give me if I am trying to one day sit in your seat?
37:47 GRAYSON: I think that the biggest thing… And all you guys in this room have it… but the biggest thing I look for is there’s a lot of smart people out there. And that’s super-critical. But that work ethic and that hustle. Kind of that mentality, “I will not be stopped.” Because there’s going to be, like, 50 obstacles that are put in front of you in hitting your goal.
That mentality is the most valuable thing. As long as you have that, you’ll develop everything else. And so just to really, truly have that and embrace it would be the biggest… the biggest piece that I’d recommend.
38:23 PAT: Grayson, thank you for coming on. We very much appreciate it.
38:26 GRAYSON: Thanks, guys. It was a pleasure.
38:29 AUSTIN: A big thank you to Grayson Lafrenz for coming on Flip the Switch podcast. Our very first guest. And please stick around because we’re going to start doing this a lot more. We’re going to have a lot of great guests. We’ve already got a bunch lined up, entering into November. And we’re very excited about all the stuff we’re going to learn from all these great entrepreneurs.
All right, let’s wrap up. Our final segment for the day. Digital questions of the week. We pulled a couple of these off of social media. First one I’m going to cue up… I think this’ll be a combo of John and Pat. How is user behavior or mobile different from desktop?
39:01 JOHN: So first off, mobile is being used a ton more. When you look at the data and the percentages of people buying on mobile through e-commerce. Now apps. Amazon’s app is incredibly successful. The reason why is it’s instant. People are usually on the go and more people have phones than people have computers, so the accessibility that people have made through their websites, through apps, through things like that has only opened up that opportunity for people who don’t have computers. Or people who are on the go all the time. I know it’s incredibly easy for me to buy something online. Even easier than it was a year ago, you know what I mean? So there’s so many advances in that that it’s just become so much easier.
And the behavior–if we’re getting specific there–behavior of mobile users is much more instant and much more direct. Resulting in more conversion.
39:55 PAT: Yeah, and from the advertising side that’s something that we see too. People that find something on mobile that’s… it depends though. If they’re looking for a lower price-point product, a lot of times they’ll make that purchase decision right then. And buy on mobile.
If you’re looking at something that’s a little bit higher of a price point and that is also sold in like retail locations or in-store, you see a lot more informational behavior. You see people shopping around–price shopping. And the term that gets used for that is “showrooming.” And pretty much what they’re doing is price comparing on the go. They see something that they like in-store. They look it up online and then they start shopping around for where they can buy it for cheaper now that they know–if it’s clothes, let’s say that it fits–or that it’s a product that they like. So to John’s points, it’s very different behaviorally. But at the same time, there’s some patterns there.
40:42 AUSTIN: Great. Thanks, guys, for answering that one. Let’ go into one final question. We’re going to go our ad expert again. Patrick. Why would you bid on your own brand name? Isn’t that a waste of money?
40:51 PAT: First of all, 2 questions in a row. I feel honored.
The short answer is “no.” it’s never a bad idea to bid on your brand name. There’s a few reasons for this.
First of all, that’s what brings in return users. So the way that I like to think about keyword or query mapping is if people are looking for your branded terms, they’re familiar with the company. There’s likely a high percentage of return users coming through those ads. So you can offer more “Welcome back” type messaging. You don’t have to introduce the brand in your ad.
Whereas with non-branded search queries, that’s basically unrealized market share.
41:28 JOHN: Yeah, and I just want to praise Austin on the authenticity of the way that you asked that question. (Laughing)
41:32 AUSTIN: Yeah, I was imagining someone like roughly our age that just entered the industry and was trying to ask that question as if through Twitter. I think that I set their voice pretty correctly.
41:43 PAT: Yeah, that was perfect.
But that’s one thing though. And also it’s basically a SERP (Search Engine Results Page) real estate play. You don’t want other competitors bidding on your branded terms, because they’re taking away potential return users from your market. And that’s a really big thing that people don’t really think about too much.
If you’re bidding on your branded terms, you’re protecting you’re brand equity on the search results page. And a lot of times, you’re going to get higher quality scores because it’s so related to your domain, your landing page, the keywords and the messaging. And you get rewarded with lower cost per clicks. So if anything, it saves you money. And like Grayson was talking about in his interview, it’s 10 times more cost effective to keep a current client than it is to acquire a brand new one. And that is true on ads. And that’s why you should always, always, always maintain 100% impression share of your branded terms at all times.
42:34 PAT: All right, everybody. That just about wraps up Episode 7 of flip the Switch presented by Power Digital Marketing. Again, huge thank you to Grayson Lafrenz for hoping on the show and imparting some awesome wisdom for us. We have some great interviews lined up.
Again, submit your user questions to us anytime. Our social handles on Twitter and Instagram are @flipswitchcast for both. This has been Pat Kriedler, Austin Mahaffey, John Saunders and Joe Hollerup signing off.
