Part 1: 60% profit margin in 2015. Agency growth to $100K MRR

Do you want some real talk about agency growth?

I almost quit three times during our first year in business.

The pressure was too great, the downs were too low, and the money was too invisible.

But most of it was in my head.

You’re reading this because you already know that, in marketing, agency growth isn’t easy. In fact, you know that growing any business isn’t easy.

But it doesn’t have to be hard, either.

Since KlientBoost is my second agency, I’ve learned enough to grow fast, to grow slow, and best yet, to grow how I want to grow.

And while this post may seem like a humblebrag, I want to make sure it’s not filled with the usual common-sense stuff about agency growth that you already know.

I want this post to bring some new things to the table.

Let’s get started.
 

This was the first lesson I had to learn, and also the hardest.

There’s enough info out there that’ll make you never want to start an agency, and straight-up quit the one you’re already in.

Profit margins are dwindling, automation is replacing humans, and clients only care about quick wins.

It’s tough.

But it’s a lot tougher if you don’t calibrate yourself to be in love with it.

Because the beauty of having an agency is that it can never truly die... if you don’t let it.

You have the opportunity to build your agency into a brand AND become a thought leader yourself.

You can do it as a solo-preneur with no clients and nothing but time AND as a 100+ person agency with nothing but money.
 

 
Once you realize that the worst can never happen, you can stop fearing pointless crap like clients leaving or employees bouncing.

Because your team is having fun and you’re having fun (by growing yourself and your brand) regardless of the size of your agency or the money you’re making.

Once you embrace everything about your situation -- the good AND the bad -- agency growth will eventually happen, and the money will eventually come.
 

You may be obsessed with agency growth tactics, but you should care more about solid strategies.

There are always quick wins and “growth hacks” to take advantage of, like Gmail Sponsored Promotions or tools like Spark Hire so we can spend less time on hiring decisions.

But nothing beats winning slowly and surely by turning silent visitors into repeat-visiting fans. That only happens when you care holistically about your brand, your content, and your mission.

Here are a few of the many notes we’ve gotten during our first year:
 

 
There have been months where we only onboarded one new client and other months where we’ve onboarded ten.

Sometimes there’s no consistency in the agency world. Sometimes you feel like you’re on fire.

So instead of obsessing over big-picture agency growth that you sometimes have no control over, commit to improving the small things consistently.
 

Here’s a list of the things we sucked at that we decided to improve (and did!):

• Getting better at content promotion for more social shares
• Sharing more small wins for our clients with our clients
• Building out more and more case studies
• Increasing our organic traffic numbers month over month
• Partnering with more companies to share content
• And the list goes on...

You’ll notice that none of the tactics above are directly related to sales or revenue. But together, they represent building blocks for growing a company and building an authentic brand over time.

Here’s a look at how our overall traffic levels have slowly improved (emphasis on the slowly):
 

 
It’s the same mentality you have in basketball when you have a shooting slump.

What else can you do to continue to help the team win?

Rebound? Make assists? Take charges?
 

You already know that content marketing is huge, but you may never have thought of it this way:

When done right, content marketing is the ONLY way potential clients will learn more about you and what you do.

I mean, think about it. Everything you put out will either impress or get a “blah” reaction from the audience you’re trying to attract.

Are you going through the motions or do you truly care enough to consistently create amazing stuff?
 

When done right, content marketing allows you to stand out amongst your competition as the only agency your visitors want to work with.

Doing content marketing right gives so much value to your potential client that they’re already halfway sold before reaching out to you. You just need to worry about not screwing up the sale.

When done right, content marketing is insanely effective for building trust in relationships that you don’t even realize is being formed.

Aaaannd...

Content marketing unlocks some HUGE doors.

When you have the care, talent, and design to create great content, a few interesting things can happen. Here’s what happened to us so far:

• Two webinars with Kissmetrics
• Two webinars with Invoca
• One webinar with Unbounce
• Multiple other webinar invites
• Numerous podcast invites
• Numerous guest post invites
• A speaking engagement at Unbounce’s Call To Action Conference in Vancouver
• Speaking engagement at ConversionXL’s Elite Camp in Estonia

(The last two are my favorites so far :) )

Did you notice how I said “When done right”?

More on that later.

Okay, fine, more on that right now.
 

Remember how I said your agency can never die?

That's true, but your motivation to keep it alive can fade over time.

To prevent this, we’ve been extremely good at auditing ourselves and our processes.
 

When I had the time, I was feverishly writing our content and guest posting. When I got too busy, we started paying our writers $300/post.

And these were good posts too!

But we were just publishing and praying for results... and that's it.
 

 
Don’t get me wrong. Praying is great, just not as an agency growth strategy.

Once I audited (aka "saw") that no one was actually converting through our content or even finding us organically after three months, I decided to change things up:

• We started paying our writers $600/post to go more in-depth
• I started making time to write more
• We brought on a person whose only job is to promote our content...
• ...And a person whose only job is to help our SEO
• We started caring about link-building

And this was just one area we found to improve during our audit.
 

We did the same thing for our onboarding process, our hand-offs, our weekly client reports, and the list keeps growing.

I give our entire team the same opportunities.

I purposely make our team comfortable to trust me (as I should) to truly tell me how they feel. We’ve had some great heart to hearts (on the business and on the personal side), so that I can audit myself.

Some questions you can start asking yourself are:

• Am I truly good at sales?
• Is our design department crap?
• Is our retention rate as good as it could be?

The key is to constantly look at yourself in the mirror and evaluate what you're doing day-to-day to see how you can improve yourself and your team.

Going through the motions won't get you where you want to be.

Growth -- agency growth and personal growth -- requires change.
 

I didn't go to a single dance during high school.

I was afraid of people watching while I would “attempt” to "dance," sure, but mostly I never had the courage to ask anyone to go with me. And even when a nice girl asked me to the Sadie Hawkins dance, I turned her down. (Again, this is not a humblebrag.)

In other words, I was shy as hell.
 

 
Luckily, things have changed quite a bit since high school.
 

I’ve learned that asking for things has so much power that I can’t help put it into practice. Even though I still get the occasional “no”, the “yeses” far out-value the fear of getting rejected.

Asking has helped us get guest blog post placements, which helped us get invites to podcasts and webinars, which has raised our content game and increased our chances of getting speaking gigs, which has driven agency growth as our biggest new source of leads and business.
 

Now I have a long “hit list” of blogs that I want to write for, and part of my plan for asking them is citing previous successful guest posts as proof that I'm worthy of their time.
 

 
Which brings me to the most obvious reason why you should make "asking" a dedicated part of your weekly routine.

It’s one of the biggest reasons for our success.

By piggybacking on other companies’ already established audiences, you can build trust and value through the content you’re writing or creating.

It’s the fastest way we’ve been able to get our blog off the ground, especially when using an author bio like this one:
 

Here’s the truth: Most marketing agencies suck at marketing themselves.

When all you need to start a company is a few brain cells and a website, everyone can do it. But not everyone can do it well.

That’s why we always wanted to be different via one distinct aspect:

Our Branding.

If you look at our (bigger) PPC agency competitors like WordStream, Hanapin, or Seer Interactive (big ups and respect to those peeps!), you’ll find that they all look pretty dang similar.

We decided to take an approach towards custom illustration and insanely subtle design choices that immediately give off a more powerful first impression than 99% of our competitors.

Because the secret sometimes isn’t how long you’ve been in business or how big your team is.

Sometimes, great design evokes trust.

It’s very subjective, of course, but if you pit KlientBoost.com against 99% of the other PPC managers out there, we immediately have an upper hand from a first impression standpoint.
 

• We care enough to thoroughly make our design as awesome as possible.
• We care about the user experience through simplicity and anti-fluff.
• And we care about our personality enough for it to shine through our site.

We get a lot of design inspiration from Dribbble, so much that we’re one of the only PPC agencies with a portfolio to show off our content and landing page designs there (another differentiator we care about).

But our focus on brand details doesn’t end with our website.

Our gifographics, webinars, speaking slides and everything we put out is with an eye on great (and farty funny) design.
 

 
It takes more time and effort, but the snowball effect we’re experiencing right now shows me that I should put more effort into agency growth strategies that don’t necessarily scale.
 

I look great in a lot of hats.
 

 
But you and I both know that most agencies aren’t fashion houses (at least not ours). And because of that, too many hats are lethal.

I used to be afraid of delegating because I truly think thought I was the best at everything. (Which leads me to another point -- how important confidence is.)

But if you turn the reins over to one of your team members and the worst thing possible happens (losing a client), wouldn’t that be a great learning lesson for them? I think so.

It’s too easy to be attached to every part of your business as you’re growing, and it’s the thing that will most likely prevent your growth as well.

That’s why your team is everything.

Josh, our Lead Designer, mapped out everything that the design team needed to be successful. And I was uber-fortunate that he decided to do it all by himself, without me asking.

Joel, our Director of PPC, pushed me to get out of time-sucking situations so I can focus on marketing and sales. And when we get a little too busy, he doesn’t let me come back and help.

Everyone on our team steps up.
 

One of the things we should’ve done from Day One is write out everything as if we’re a franchise.

Meaning that if we were to clone ourselves in another office in another city, everything we do -- methods, processes, etc. -- should be "transportable" through internal documents, audio, and video, without our interference.

With the goal of, honestly, being able to bring in anyone from the street, teach them PPC, and have them get results.
 

 
Once people have everything they need to be successful, let them flourish and let them fail.

Get the eff out of the kitchen and use your time in a smarter and more effective way.
 

Remember my headline, which said we’re making 60% profit margins (out of the $100k/mo, $60k of that is profit)?

Well, that’s kind of... not true.

Some months we make 50%, and others we make 70%.

Which brings me to an important lesson:

Charge Enough To Never Charge Extra.

What I mean by that is:

Never à la carte anything. Once a client pays, it’s your responsibility to get results as fast as possible, even if it’s beyond the scope. Your goal is retention, not to squeeze out extra pennies. Think long term, not short term.

Low cash flow will kill you. Charge enough to never run into that problem (aka "raise your prices"). It will also help weed out the clients that will be your biggest pain. You know the Pareto Principle, right?

This brings me to another lesson:
 

We’re lucky enough to be a hybrid PPC/landing page agency that can move relatively quickly to generate a higher ROI.

Once you’ve paid for yourself with the additional results you’re bringing in, the nerves and uneasiness disappear (even if you’re great at setting expectations during the sales process).

Clients always appreciate a sense of urgency, and we’ve consistently found new ways to hit the ground running quicker and quicker over time.

Last lesson for this section:
 

Are you invoicing after each month of work is over with net 30 terms? If so, why?

We used to do that, but now require all clients to pay upfront.

Is it because you’re billing a percentage of ad spend?

We used to do that too. But we realized that billing that way isn't actually beneficial for either party.

Our sweet spot has been charging a flat fee no matter the ad spend. Because you and I both know that the amount of work doesn’t change much. If it does, then you’re doing it wrong.

And most importantly, every time you send an invoice, you’re giving your client a chance -- and a reason -- to reconsider whether or not the value you bring is worth the money they’re paying.

Making invoicing automatic with Stripe has also helped us eliminate worries over late payments.

 
One more last lesson for this section (seriously this time):
 

It’s almost too easy to say yes to any client that comes knocking on your door when the knocks are few and far between.

And while it’s okay to bring on any business you want as a client, the only thing I can say is: Don’t Lower Your Prices.

That's the opposite of agency growth. It’s a gateway drug to agency death.
 

There’s nothing worse than having a great sales month and then realizing that your revenue hasn’t grown because you only replaced lost clients.

When you focus on retaining the clients and customers you already have, the foundation of your business keeps getting stronger and stronger.

Too many people have Shiny Object Syndrome. We all love the rush of closing a new deal, but the un-sexy truth is that keeping your existing clients happy provides far more profit and long-term agency growth.
 

Giving value before asking for it is so simple. And yet, somehow, everyone still screws it up.

When you can turn your fear of networking (which I’m not good at) into an opportunity mindset -- “how many people can I help today?” -- something magical happens.

Influencers and people higher up on the totem pole get asked for favors to share content or do X or Y all the time.

But one of the fastest ways that people have earned my trust, and I've earned theirs, is to be the first one to scratch a back.
 

 
That's how I met Aaron Orendorff from IconiContent, who’s now connecting me with more people and mentioning us in some of the articles he writes, since I helped him connect with other people first.

It's also how I met Sujan Patel from ContentMarketer.io (now Mailshake). And Sujan introduced me to Jason Quey, who has helped with our content promotion. Jason also helped me get access to Slack groups to meet new marketer friends after we helped him design some landing pages.

Finally, this is also how I met Julia Stead and Amber Tiffany from Invoca, who invited me back to do a second webinar after I invited them to our "CRO Day" party.

The list goes on...
 

Don’t hire when you need to. Always hire ahead of time.

Momentum is a real thing in the agency world. And sometimes, it’s impossible to predict.

Once we had a big enough buffer of profit margins, we decided to think long term and hire early.

I now spend more and more time in the HR world by finding new candidates and creating relationships, so when the timing is right, they’re ready to join our team.

Because if you really think about it, hiring is freakin’ hard.

• First, you have to find candidates (2-4 weeks)
• Next, you have to interview them (1-2 weeks)
• Then, you offer one the position (1-2 days)
• If they accept, they have to put in their 2 weeks (2 weeks)
• Then they have to be trained (2-8 weeks)

Even if everything goes perfectly, that’s, like, three whole months!

If you have training programs in place and a growing list of potential hires, then you can almost hack your way to being more effective with hiring. Sometimes, though, I feel like it's the bane of my existence.
 

You’re already wasting your time reading this post. Stop it.

The greatest “Aha” moment I’ve had was when I started unsubscribing from blogs, stopped reading blogs, and stopped consuming content altogether.

You already know everything you need to do. You just have to start doing it.

Because there is no magic bullet.

Most of what we’ve done, and continue to do, requires hard work and long hours. But most importantly, we learn as we go.
 

I’ve been doing PPC for just 4 years now.

I’m not an agency growth magician, and I know that $100k/mo is still a relatively low number compared to other agencies out there.

But what I do know is that none of this is rocket science. It’s literally common sense, time management, and knowing what competitors are lacking.

If I can do it, you definitely can too.

Cheers :)