Giving B2B prospects an outrageous offer they can’t refuse with David Valentine

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It doesn’t matter what kind of an agency you run, traditional, digital, media buying, web dev, PR, or whatever your focus, you still need to run a profitable business. The Build A Better Agency podcast presented by White Label IQ, will show you how to make more money and keep more of what you made. Let us help you build an agency that is sustainable, scalable, and if you want down the road, sellable. Bringing his 25 plus years of experience as both an agency owner and agency consultant, please welcome your host, Drew McLellan.

Drew McLellan:

Hey, everybody. Drew McLellan here with another episode of Build a Better Agency. We’re going to talk about sales and outrageous offers and all kinds of other things. That’s going to be an interesting conversation, no doubt about it, but first, I want to remind you, if you are a fan of the Mercer Island Group folks, that’s Steve and Robin Boehler, Lindsay O’Neil. You have learned from them in the past, either on the podcast or maybe you saw Robin as a keynote speaker at our very first summit in 2021 or you’ve attended one of their workshops before. You know that they are brilliant. They are generous. They believe in and support and celebrate agencies. They are uniquely qualified to help us get better because they literally see hundreds and hundreds of agencies chasing new business, pitching, both in writing and in person and I guess, today, probably on Zoom. They’ve just gleaned so much insight about how agencies win at new business.

That, we have them on the podcast regularly. We’re doing workshops with them regularly. We have two workshops with them that I want to call your attention to. The first one is a brand new workshop called, Get It Right. It’s all about written proposals. Whether or not you just get asked for a proposal and you’re not in a shootout with other agencies or a formal RFP or anything in between, they’re going to spend two days in January. It’s January 24th and 25th. They’re going to spend two days teaching us the good, bad and ugly of how we write when it comes to new business and how we can do it better. That workshop is in Orlando, Florida at the Contemporary Hotel on Disney Property. You can register for that right now by going to the AMI website. I’ll do that in a minute when I tell you about the other one.

Back by Popular Demand is the Selling With Strategic Insights workshop. I think we’ve held this workshop now, I’m going to say, five times. We have to limit it to 50 people. We always have a wait list, which nobody ever cancels. We can never really honor the wait list quite honestly, but 50 people in the room. We’ve done it five times. I would say, most agencies bring two people. Let’s call it 130 agencies. They’re at over $100 million of AGI, one, using what they learned in this workshop. It is spectacular. If you’re looking to grow your agency and you want to improve your win rate, both of these workshops, January 24th and 25th for the Get It right, all the written proposals, and July 24th and 25th, which will be in Denver, by the way, for the Selling With Strategic Insights. Both of them are on the AMI website. Go to agencymanagementinstitute.com and then under How We Help, you’ll find the workshops and you can find both of them there.

Love to have you. I will tell you, both of these will sell out. Don’t wait until the last minute to grab your ticket. You want to make sure that you can be there and be with us, all right? Let me tell you a little bit about our guest today. My guest today is a guy named David Valentine. Dave used to own an agency. He’ll tell you about that story now. He’s a serial entrepreneur. He owns seven or eight companies, several of which serve agencies. Specifically, what I wanted to talk to him about today is, one of his companies helps agencies book appointments with prospects. We’re going to talk about how they are successful at that. What are some of the tricks and of the trade there. He’s going to talk about things like outrageous offers. He has a very interesting take on case studies.

I think you’re really going to find this fascinating. For some of you, you may listen to it and go, “I don’t think I’m going to do all of that.” Others of you may say, “I’m switching tomorrow,” but for all of us, I think it’s thought provoking and it forces us to think about the way we are doing business and is it the right way for our shop, because every shop has their own way. Anyway, without further ado, let’s get to the conversation. All right. David, welcome to the podcast. Thanks for joining us.

David Valentine:

Super excited to be here, Drew. Thanks for having me.

Drew McLellan:

Tell everybody a little bit of your backstory. How did you get to where you’re at today? What drove you in that direction?

David Valentine:

Yeah. When I was 10, Drew, I started selling candy bars out of my backpack and got $5 loan from my dad to go buy a candy bar for 25 cents and then sell them for 50 cents. That was my first business foray. My first adult business was when I was 25. I had been doing marketing in-house. I started working at an internship when I was 18. I was still in high school because I just loved to work. I was running MySpace and Friendster accounts, building websites and shooting promo videos for this small company doing all the work in-house. I’d kept doing that for a while, Drew, and then I kind of saw what it looked like in the agency world. By the time I was 24, I started interacting with these other agencies and I realized they had no idea what they were doing from an internal perspective. We were just like, “Wow, they really don’t know.” We were working with four different agencies at the time. I was at a large company.

I thought, “Well, I can go do this.” I had never worked at an agency before. I’d never sold a client. I had no idea what I was doing, but I started to build up this nice little catchall digital agency.

Drew McLellan:

Yeah. I was 30 when I did that, but I had worked in agencies since, actually, when I was in college, but I still had no idea what it meant to run an agency. I was like, “My boss is stupid, so how hard can it be?”

David Valentine:

Precisely.

Drew McLellan:

Right.

David Valentine:

Yeah. I started this agency and we networked our way to a million dollars, worked our tails off. By the time I was 29, I went to the doctor and he said, “Hey, how do you know you’re going to have a heart attack, Dave?” I was like, “I don’t understand that question doc.” He goes, “You don’t know. You just have one.” He said, “We’ve tested 4,500 people. You’re the most stressed out person we’ve ever tested.” I was like, “Wow.”

Drew McLellan:

Yeah, that’s it. That’s a trophy you don’t want to have.

David Valentine:

That’s right.

Drew McLellan:

Right.

David Valentine:

He goes, “You want to walk your daughter down the aisle?” I was like, “Yeah.” He goes, “You’re not going to see her graduate from high school if you keep going at this pace.”

Drew McLellan:

Wow.

David Valentine:

Geez.

Drew McLellan:

Right. That’s a little eye opening.

David Valentine:

Yeah. You’re four years into a business and you’re like, “Dude, we’re doing a million in revenue.” We’re like, “We’re growing really well.” It really forced me to go, “Okay, how do I build this thing without killing myself?”

Drew McLellan:

Right.

David Valentine:

It was the prototypical business where I was the go-to guy. Even though I had really good staff, I had a number of staff and growing staff, we even got bigger, but what would happen every time is that a client would say, “Well, listen, to their account manager, I love that you’re telling me this. I’m super excited about the results we’re seeing. I really need to talk with Dave. We’d like to put him on a plane. We’ll pay for eight hours of his day, but we need him in New York. We need him in Knoxville, Tennessee. We need him in San Diego, and we need him there next week.” It was just always this constant battle of everyone always needed my time. If there was ever a big problem, Dave was the one to come to the rescue.

Drew McLellan:

Right. Yeah, I’m sure a lot of listeners can relate to that.

David Valentine:

Oh man. It’s like the agency life because there’s one person that’s a creative guru. There’s one person that’s super insightful in how to speak to a client, and they’re A players. When I started to ask the question once, Drew, it was like, “Okay, how do I build a company that doesn’t do that?”

Drew McLellan:

Right.

David Valentine:

I sold that first company and then I started new agencies out of that. Essentially, the new agencies that I started that were within my non-compete, they were totally kosher. They were agencies that were built on results only. Only selling results, not selling a scope of work. The customers, the clients didn’t know me. They know of me, but they don’t know me. What I’ve been able to do, Drew, is, my wife, three kids, two dogs and I, travel across the country. We stay at different places that we like to live. I’ve been able to invest in by a whole part or launch or whatever, eight different companies. I work pretty standard hours, about 40 to 50 hours a week, which is my sweet spot. I don’t want to work less than that.

Drew McLellan:

Wait, wait, wait. You don’t only work four hours a week.

David Valentine:

I am not that cool, Drew.

Drew McLellan:

I don’t think it’s possible, but okay.

David Valentine:

It’s one of those things, man. The four hour work week is a really catchy title. I loved it. That’s an idea of having a side hustle and it’s cool. I love to work though.

Drew McLellan:

Yeah. Right.

David Valentine:

It was funny. I was having a conversation with some of my leadership staff this morning at one of the bigger companies and I said, “I just love to win.” I’ll work however long I need to to win. I just want to win. Anyways, yeah, I really enjoy my time now. I get to do these really exciting things that my childhood self would not believe if I told him some of the things that I’m into at this point. It’s super fun.

Drew McLellan:

When you say sell on results, talk a little more about that. Because we have a lot of conversations about that, myself and agency owners, and it sounds appealing to them until they realize how little of the sales process they control inside their clients and then they start to get cold feet about it, which I completely understand. Talk a little bit about how you sell by result.

David Valentine:

For agencies, because a lot of our companies work with other agencies, Drew, so they’ll represent one of my biggest companies is an outsourced SDR firm. Agencies always need more clients. You can only-

Drew McLellan:

SDR stands for?

David Valentine:

Outsourced Sales Development Rep.

Drew McLellan:

Thank you.

David Valentine:

Yeah, you’re welcome. I forget that that is not an acronym that everybody knows, but you’re right. Basically, what they’re doing is, they’re booking meetings for one business to another business on the calendar. It’s not just a lead that somebody has to go track down. It’s actually a meeting that you’re going to have. What we did for that one was, we just said, “Hey listen, we will guarantee a minimum number of meetings that you’re going to have booked in a quarter in a year.” Here’s the conditional part of it and this is what I love to do for other agencies is to create conditional guarantees. In order for you to get the guarantee, you have to give us an offer or I like to call them outrageous offers, something that sounds too good to be true, but actually isn’t. Also, you need to have three case studies that we can lead with in our cold outreach to these potential clients. That’s something that we can control if we put it as a condition.

Drew McLellan:

Right.

David Valentine:

When it comes to how we do that, honestly, man, we DQ a lot of people, Drew. 60% of the people we have conversations with in sales for that company in particular, they’re disqualified. What’s fascinating about that though is that we’re going to close some between 75 and 85% of the people that are qualified because it’s a great deal. If you qualify, it’s fantastic. The ways that some of the agency owners that we’ve worked with have created these guarantees and sold on results, they just put conditions around them. What do you need to control? What would you need from your client in order to guarantee results? What I used to do back in the digital advertising days when I had that agency, that was my first company, if somebody wanted to guarantee on results, I’d say, “That’s fine, you have to give me free shipping,” If we were working with E-com.

Because something that we found was 48.4% of users would not make a purchase on any E-com site. Not because they didn’t trust product claims, not because they thought the product was too expensive, but because they didn’t get free shipping, because Amazon conditioned us to want free shipping.

Drew McLellan:

I was going to say, it trained us, right?

David Valentine:

Yeah. It’s one of those things where it’s like, you just have to start to figure out what are the variables that you would need to control to guarantee results, dictate that to your client before you begin the relationship in a paid fashion.

Drew McLellan:

Yeah. Interesting.

David Valentine:

If they sign off on it, now, you’re good to go.

Drew McLellan:

Let’s talk about this idea of an outrageous offer. Give me some examples of outrageous offers that some of your agency clients have put forth that has really attracted prospects to sign on the dotted line. What does one of those look like?

David Valentine:

Yeah, so I’ll use some of my own agencies that I run. We have a PR firm that books people on podcasts. They’ll do a, “Hey listen, I’ll book you on two podcasts for free and you can see the results.” What that does for people is, a lot of people have hangups on, “Am I going to be any good as a guest on a podcast?” That’s one. Two, can they actually get me on podcast? It gets over that. Then what happens is, after they’re on their second podcast, they end up signing an agreement. They say, “Hey, I want to be on podcast.” We guarantee that they’re going to be on at least four podcasts a month or they will get on Forbes and be published in Forbes or will give them their money back. For the web design branding agency that I own, we’ll run a month of their social media for free. Because again, what’s the biggest hindrance that we have to relationship?

People are going, “Hey listen, I’m not sure you’re going to get my voice. I don’t think you’re going to understand me. I don’t know if you’re worth 5,500 bucks a month to run my social. Fine, we’ll prove it to you. Our work is fantastic.” We run their social media for a month to go, “Holy cow, you guys are incredible. This is amazing. Yeah, let’s move forward.” It’s really putting yourself on these deals where, what’s the friction to saying no and yes, right?

Drew McLellan:

Right.

David Valentine:

You think about Amazon again. What did they do for buying? They made it frictionless. They’re like, “Hey, one click, let’s go.” That’s what we really fail to do, as agency owners, a lot is we create all these roadblocks. “Well, hey, you have to pay for discovery. Hey, we need to have three meetings before we can actually present you creative.” Don’t do that. Why would you do that? You’re making it more challenging on yourself to sell a prospect. Instead, just say, “Look, I’m going to give you this for free. Here’s the value. In exchange, at the end of this, you’re going to say yes or no.”

Drew McLellan:

Is an outrageous offer always free? There’s always a free element to it?

David Valentine:

Not always. Sometimes it’s a guarantee, right? Again, going back to the idea of the empathy firm. It’s like, “Hey, we’re going to get you published in Forbes. It’s not cheap to get that done. There’s a lot of pitching that goes on. It’s a lot of man hours, a lot of work. If we don’t get you there though, I’ll give you your money back, but if we do get you there, you’re going to pay.”

Drew McLellan:

Right.

David Valentine:

You can do a pay for play. I do some consulting with business owners that are looking to scale. I always look for people that are smaller, under seven figures. I just tell them, “Look, if I can’t increase your revenue by 50% in 12 months, I’ll give you every dime back.” Yeah, there’s this sense of, again, it’s all results oriented. What can I control? Now, again, in that one, it’s like you actually have to do what I say. You can’t just be waffling, but yeah, that’s the idea.

Drew McLellan:

Yeah, we’ve had a couple agencies dabble with guarantees. I guess it would matter a great deal about how clear your language was. Because I had an agency that did a great work, but the language in their agreement about what the client had to do to earn the guarantee was, wasn’t as tight as it could have been. What happened is, of course, the clients were like, “Well, I want my money back. Here’s why I want my money back.” They ended up in court.

David Valentine:

Oh.

Drew McLellan:

Right. Horrible.

David Valentine:

Yeah, not fun. I think, look, lawyers are more important the bigger you scale. They just are.

Drew McLellan:

Right.

David Valentine:

It sucks to have a lawyer bill and the tens of thousands every year, but I do. That’s when everything’s great. It just is what it is.

Drew McLellan:

Yeah, an ounce of prevention, for sure.

David Valentine:

Yeah.

Drew McLellan:

I want to talk more about the SDR and that concept. Because as you know, there are other folks who do that. What I hear from agencies is mixed reviews. I’m curious about how you are successful at that. What I want to do is, I want to take a quick break and then we’ll come back and we’ll talk about how you do that work. Hey, everybody. I promise, I would not keep you more than a minute, but I want to make sure that at AMI, one of the things that we offer our virtual peer groups. Think of it as a Vistage group or an EO group, only everybody around the table, figuratively in this case, is an agency owner. You have to be an agency owner to belong.

The virtual peer groups meet every month for 90 minutes on Zoom. This was not a COVID creation. It was pre-COVID. You see the same people in your cohort every time. You get to create relationships with them. It is facilitated by AMI staffer, Craig Barnes, who has owned his own agency for 25 or 30 years. Plenty of great experience, both from Craig, but also learning from each other. If you have any interest in learning more about how that works, head over to the AMI website and under Memberships, you will find the virtual peer group and you can get all the information there, all right? Okay. Let’s get back to the show.

All right. I am here with David Valentine. Well, we were talking about outrageous offers, which sometimes are about something free or sometimes there’s a guarantee element to it, a guarantee of a result, but earlier, David was saying that one of his agencies actually does outbound calling on behalf of other agencies. If I remember what you said was, the agency had to have an outrageous offer and they had to have three case studies. The case studies have to be tied to the outrageous offer.

David Valentine:

No, not necessarily. We basically found a formula, Drew, that works for those case studies. Most people, when they think about a case study, they think, “Oh, I have to have something that’s really nicely designed. It’s going to be multiple pages.” That’s what we get a lot. What’s hilarious is, we actually take those big case studies and we shrink them down into a singular sentence. The formula for the sentences that really worked are, we worked with X company, they got Y results in Z time. The thing that works with that is, again, what do people want?

Drew McLellan:

Right.

David Valentine:

They want results. They need results fast, right? The key here for that last part, Z time, if you have something that you can say that they got a result in 90 days or less, you have exponentially higher response rate to that email or to that LinkedIn or whatever outreach you’re doing. You’re going to have a lot more people that can wrap their minds around. Most people can’t imagine what they’re going to do next year. I know that they’re planning for next year, but the truth, they’re not thinking about next year, not in detail.

Drew McLellan:

Right. Right.

David Valentine:

They’re really going, “Man, where can we be in 90 days? How can I hit my goals for the quarter? If I started to engage with this, can I hit my goals for the following quarter?” We have to start to think in that way. They have to have the case studies and they have to have that outrageous offer. The thing that makes us unique, honestly, through is that we teach our clients how to sell results instead of how to sell their product. Let me give you an example. We have a client. We work with a lot of agencies. We work with a lot of SAS products and software and all sorts of stuff. One of them is an ERP software. The team loves to sell to CFOs and controllers because ERPs by nature are designed to create efficiencies and save money.

Drew McLellan:

Right. Right.

David Valentine:

In all their previous outreach, everything they were talking about was how their ERP system is cloud based. No one cares.

Drew McLellan:

Right.

David Valentine:

Why would I care?

Drew McLellan:

Right. Right. That’s not why I’m buying it.

David Valentine:

That’s not what I’m buying. The cost to implement it for a decent size company, if they’re doing 20 million or more in revenue, it’s going to be a $500,000 price tag instead of the CRP for year one. It’s probably going to 100,000 after that in maintenance year two and beyond. I just said, “Look guys, this is extremely painful. Takes about a year to implement. It’s very frustrating for people to do it. You have to show them return on investment. So how much are you saving these people? So they went back and they started asking their customers, “Hey, how much do we save you? How much are we helping you? What’s your efficiency?”

Here’s what they found, Drew. This is what’s fascinating. On their baseline, the bare minimum that they will save for their smallest customer that maybe pays them 150k to do a setup and then they’re going to pay them 50,000 a year after that, they’re going to save $250,000 a year. I was like, “Guys, let’s lead with that and copy.”

Drew McLellan:

Right. Right.

David Valentine:

Really, it’s just doing good marketing. This isn’t rocket science. What most SDR firms do though, Drew, is they take what the client tells them, whether it’s an agency or someone else, they regurgitate it in an email or LinkedIn and it’s terrible. Marketing agencies, historically, are terrible at doing their own marketing.

Drew McLellan:

Right.

David Valentine:

They don’t know how to talk about themselves.

Drew McLellan:

They don’t make the time, nor do they really take the effort to dig deep enough, unfortunately. Because I get it, they’re running chickens with their head cut off. The whole Cobbler’s children have no shoes. Excuse.

David Valentine:

Correct.

Drew McLellan:

It’s just a comfortable place to be. Yeah.

David Valentine:

Well, the thing that’s weird is that if an agency looked at their website as if they were their own client, they would be mortified, because there’s no clarity about who they serve, what they do. I did this in my first agency before I figured this out between a long time, but in my first agency, I was like, again, because I had no agency experience, I’m like, “You Drew.” I was like, “I don’t know what I’m doing. I’m just going to go look at other agency sites and kind of come up with something like that. My websites were always visually stunning. They were very, very interesting and complex and they did nothing for my sales.

Drew McLellan:

Right.

David Valentine:

Now, all my websites generate 20 or more B2B meetings a month because they’re exceptionally simple, very, very clear. What it does is, prospects know, “Hey, this is what I’m getting when I work with Dave’s companies.” The other thing that we did, Drew, this is a great hack for agencies and I wish that more people would do it. Put your pricing on your website. I used to be afraid of that. I was like, “Oh no, but people are going to be afraid.” No. They’re going to realize and DQ themselves or qualify themselves base what’s on your site. Now, the meetings that you are having are better. Usually, that fear of, “Oh, people are going to, DQ themselves, happens when they don’t have a reliable lead generation meeting booking source.” That’s really what Avadel is about.

I love doing it because we’ve had so many good agencies grow and scale at fast rates because we know how to speak to CMOs. We know how to speak to business owners. We know how to speak to heads of marketing. When we do that, those agencies grow exponentially fast and they have champagne problems as I like to call them. “Dave, we need you to turn off the campaigns for two months because we don’t have enough people to fulfill the work.”

Drew McLellan:

Right.

David Valentine:

Right.

Drew McLellan:

A lot of people are having that problem these days.

David Valentine:

Yeah.

Drew McLellan:

Talking about putting your pricing on the website, I’m channeling my listeners who would say, “Well, we don’t have a set price for a thing.” Many, many episodes ago, 200 episodes ago, I did a solo cast where I talked about agencies are either an artesanal bakery where everything is custom made and somebody walks in the door and says, “Hey, can you do a chocolate chip loaf of bread?” They go, “We never have before, but we absolutely can,” right? Then there’s the Wonder Bread Factory, which is, “Look, we make bread. It’s white. It’s wheat. It’s always the same size. We cut it the same. You want white or wheat? Well, can you make the chocolate chip bread? No. No, we cannot. We make white and wheat bread.” I think for the Wonder Bread Factory agencies, for anybody listening who hasn’t heard that episode, I think it’s Episode 100.

David Valentine:

Nice. Look at you-

Drew McLellan:

I could be wrong.

David Valentine:

… right on the money.

Drew McLellan:

Well, it’s the one people talk about all the time.

David Valentine:

That’s huge.

Drew McLellan:

If you say to me, “What’s your episode about? Any other topic?” I’d be like, “Did I do one on that topic?” Anyway, I think for the Wonder Bread Factory agencies, the agencies that really work on trying to be very methodical and systematic, and we have a limited number of offerings, but we do them very well, but we don’t add bows or bells or anything else.

David Valentine:

Sure.

Drew McLellan:

We just do it. I can think they could see how putting pricing on their website would make perfect sense. Is it possible for their artesanal bakery agencies to do that?

David Valentine:

It is, because what I’ve found with those artesanal bakeries agencies to do that with, the ones that are just doing completely custom work, most of them have some process. This is one of the things that I always pull out of them, Drew. I’m like, “Okay, what do you do in your first step?” Client says, “Hey, I want to work with you. What’s your first step?” Almost all of them go into some big discovery, massive ideation phase where they’re really trying to flesh out what’s going on, which is absolutely appropriate for that business. I would say, “Okay, then put that on your website. Say what that is. Say what the deliverables are. Say what the outcome is and then put the price tag on it.”

We did this with an agency recently. They worked with Fortune 2000, some really highly funded startups as well, they’re exactly like what you’re talking about, Drew, but they have an eight-week program. It costs $50,000. It’s how they lay out the framework for how they’re going to solve the problem once they understand it. I said, “Let’s just put that on the site.” They put it on the site. We put it in our SDR email outreach and direct mail copy. They started booking meetings like crazy. They’ve never booked meetings through SDR, any other SDR firm before, and the two owners were like, “We don’t even understand. We were afraid that people were afraid of that price tag.” I said, “People aren’t afraid of the price tag. They just want to know what they’re getting.”

Here’s the kicker, Drew. We made it so that there was a guarantee at the end, if the client wasn’t satisfied, that agency would work for free until they were in that eight-week transition time. Because it’s the foundation for how you move forward.

Drew McLellan:

Right. Right.

David Valentine:

Why wouldn’t you work until they’re satisfied?

Drew McLellan:

Well, honestly-

David Valentine:

It’s so easy.

Drew McLellan:

… any agency would, anyway, right? If the client is not happy-

David Valentine:

Bingo.

Drew McLellan:

… with whatever the strategy is or whatever, you’re going to keep taking a swing until you get it right.

David Valentine:

Right. It’s like, let’s just say that and they weren’t saying… That’s the thing that’s fun here, Drew, is that most people aren’t saying the thing that they already do anyways. Just say it out loud. I’ve had agency owners who were like… I’m like, “Hey, if they don’t love the website or they don’t love the rebrand, what do you do?” They’ll just go, “Well, we won’t charge them.” I’m like, “Okay, so why isn’t that anywhere?” That’s nowhere on your site. That’s nowhere on any of your proposals. It’s nowhere. Then when we start to show that in their outreach, we start to put that on their website. I’m not putting it on the websites. They’re putting it there. They start to see meeting generation happen. They start to see new business come in. They look at me like, “Wow, you really hung the moon in the stars?” I’m like, “Dude, I just took what you already were doing and made it public. That’s it.”

Drew McLellan:

Right. Yeah. Interesting. You’re right. Probably even for the most custom agency, there is probably some element of their business. You’re probably right, it probably is that early on discovery process that they could attach a price tag to. I guess if they were asking my opinion, I would attach a high price tag to it. You can always negotiate down.

David Valentine:

Absolutely.

Drew McLellan:

Yeah.

David Valentine:

Yeah. No one’s ever gone into a… It’s like that thing I was talking with a friend recently about having some work done on our house up in the mountains. I got this quote back on building out a 400 square foot patio with flagstone, and it was to have a nice wood burning fire pit. I had an expectation in my mind for the price tag. The price came back twice as much as my expectation. I approached the guy and I said, “Look, I can get the same flagstone from Home Depot. I’m no one. I can get it for half the price you’re charging. I’ll tell you what, I’ll send somebody to go get it from Home Depot. They’ll get it and you guys install it. What’s the price?” We started to have this negotiation. Finally, he came down to where I thought it should be. I was like, “All right, now we could talk,” but it was easier for him to do that because he started out high.

Drew McLellan:

Right. Of Course. Right.

David Valentine:

I just went, “Look, I’m not going to pay that.”

Drew McLellan:

No. No.

David Valentine:

I’ll find the way around it.

Drew McLellan:

No client is ever going to come to an agency and go, “You know what, I know you said it was 25,000, but I would like to give you 35,000.”

David Valentine:

Right.

Drew McLellan:

Right. Right. Yeah, there is no negotiating up. Right.

David Valentine:

Right. Yeah.

Drew McLellan:

Let’s talk a little bit about the objections that your SDRs are hearing when they are pitching some of your agency clients. When they’re saying, “No, I don’t want to be on the two free podcast or whatever,” what are the objections? Where do your folks have to double down and get past a barrier?

David Valentine:

A lot of times, business owners can’t believe that this is real. They are trying to figure out what the angle is.

Drew McLellan:

With the hook.

David Valentine:

Yeah, and transparent. We have the same six core values for all the companies that I own. Transparency is one of those. We’ll just tell them, honestly, “Look, our work is so good. Once you get to working with us, you’re going to love it. We know that if you do this, you’re going to engage with us.” I’ll give you an example of a company of mine and how we figured this out, and then I’ll bring it back to agencies because it’s fun just to talk about other industries and see how this works. I own a flight school. It’s doing exceptionally well.

We literally take people, train them up to get their private pilots license or go all the way through and go join the airlines, right? One of the things that we figured out was is that we close a lot of people off of what’s called a discovery flight. They use to pay $200 for a 30-minute flight. They’d go in with an instructor pilot, instructor pilot would say, “All right, you take off.” They’d just be on the yolk and take off and fly around. The instructor pilot would land and talk with them and basically sell them. We figured out that we were selling those people at about 88% of the time. They’d go into a minimum of a $10,000 engagement. The highest they would have is a $90,000 engagement. We’re closing those at 88% of the time.

I started talking with my brother who’s my business owner in that one. I said, “Why aren’t we charging 200 bucks? Everybody else is charging 200 bucks. He goes, “Well, we recoup our ad cost.” I was like, “No, no, I understand, but why are we charging 200 bucks? What if we charge $50 for a discovery flight and we got more bodies in?” He was like, “Well, let’s try it.” We tried it. Of course, our acquisition increased.

Drew McLellan:

Right.

David Valentine:

Guess what? Our conversion rate didn’t decrease in any meaningful fashion. It went from 88 to 84%, but I got three times as many leads. We still won. I’ve done this with agencies as well, Drew, where it’s like, whenever we have some people are pushing back and they just can’t believe it, it’s too good to be true, I just tell them honestly, “Look, we’re going to help you find the success that you need. We’re going to create such a great experience for you. You’re going to love it.” When they do have that great experience, now that there’s no bait and switch. They’re like, “Wow, this is fantastic. We absolutely need this work. Let’s keep going.”

Drew McLellan:

What else are you hearing? One of the things I’m hearing from agency owners is that the sales cycle is taking longer. Are you focusing on that too? Are people taking longer to decide?

David Valentine:

Not really. Not really in the sense of this. They are doing what they’ve always done, Drew, which is, they take on average about six weeks to close for most of my companies. The reason why they take six weeks to close is, there’s almost always another decision maker that needs to be involved. People are starting to get tighter with their purse strings, I think. When you’re selling based off results though, it’s a challenge to say no to. Because what does everybody always need? They always need growth. Now, the biggest companies in the world are spending billions of dollars in advertising. Why? Because they still want growth. It’s not changed.

Drew McLellan:

Right.

David Valentine:

It’s not like they’re doing something different. That’s what they’re still aiming for. When it comes to the agencies that are listening to this podcast, they’re like, “Man, it’s taking longer. What could you do to incentivize this?” One of the things that our sales team does every single week is say, “Hey, if you close by Friday, we will do X.” Now, that can change week to week. It’s really pushing the ball forward. What’s the lever that’s going to make it work for them to say yes? The reason why we do that, honestly, is because, man, I’m hungry. I want new… We have high sales goals for every company.

For the biggest company, we’re trying to sell 25 deals a month, and we routinely hit it. For the smaller agencies, we’re trying to sell eight deals a month, and we routinely hit it. Part of the way that we hit that is by, “Hey, listen, we’ll work for the first month half off.” Well, we’re going to get them into a long term relationship, so why wouldn’t I give them the first month half off? We all know this. We’re in marketing. It’s more expensive to acquire a new customer 10 times more than to keep existing.

Drew McLellan:

For sure. Right.

David Valentine:

Just give them a deal. Verizon and ATT, or I think it was Verizon, was giving away free iPhones to everyone. They may still be doing this if you switched or if you stayed with Verizon. Now, an iPhone, even at half price, is still not cheap. They are looking at it and they’re like, “Dude, we’ll give up to $2,500 to this individual family, like customer, but we know that we’re going to recoup all that money plus some after they’ve been with us for two years, so why wouldn’t we give them free iPhones?” We think that this is a thing that is impossible for small businesses to do, yet, the biggest companies in the world do it all the time to get new customers. Why do we think as small business owners that we are excused from giving that away as well? It’s a weird thing that we have. In the small business space, we’re like, “Can’t do that.” It’s like, “Well, everybody else is doing that, large companies.”

Drew McLellan:

Well, I think the argument is, it diminishes their perceived value of us if we give it away for free, which I understand your argument about it.

David Valentine:

Sure.

Drew McLellan:

I think that’s the mindset, right?

David Valentine:

Yeah. Look, I had some great mentors in my early days in the agency space that would’ve said the exact same thing to me, “Don’t do that. Don’t do that.” I have found that if you don’t do that, then literally, what you’re doing is, you’re playing on, “Well, look, I’m just better than that guy. I’m just better. We’re just better than that agency.” There’s nothing that’s great about that. Instead of saying, “Look, I’m going to make this easy for you. I’m going to give you 30% off at the first quarter every month. I’m going to work for your cost.” Literally, I had a conversation with a woman. I don’t take sales calls very much anymore, but I had one last week. She listened to me on a podcast. She reached out to me and was like, “I really love to talk to you.” “Great. Let’s talk.”

We talked for 30 minutes. I just liked her. When you just to a client and you’re like, “I just like this person.” I’m like, “Look, let’s do this. I’ll work for cost for the first quarter and then after that, we’ll increase.” She was like, “Why would you do that?” I said, “Well, I heard what you said. You’re building a software for $400,000 right now. It’s not going to be done until the end of this quarter. You’re spending 400k in this quarter or Q4.” I said, “In my experience building software, because I built enough software on my own, it’s going to take longer, but here’s the deal, I can help you get through Q4. You need new business to fund some of that. Let me do that at cost.” She was like, “Why would you do that?” I was like, “Because I’m going to show you that we’re great, and then the next quarter in Q1 of 23, I’m going to charge you full price. I’m going to keep charging full price from now until six years from now.”

When you go, “You know what, Dave? This is great, but I’m going to move it in-house or whatever you do, but I can help you right now. Why wouldn’t I do that?” She was flabbergasted. She had been shopping around. She literally goes, “All right, well, I feel bad for the other agencies cause we’re just going to go with you. Now, listen, that costs us $4,500 to put her on our base to your plan at one of the biggest companies that I own, and she’s going to be a client now. She already signed. You just have to think through how you can move the dial a little bit.

Drew McLellan:

Yeah. Fascinating. The psychology of all of it is fascinating.

David Valentine:

Yeah. I feel like it’s one of those things where we get in our own ways a lot, Drew. We’re like, “Well, I got to have enough. I keep increasing price. I’ve got to charge for this. I got to charge for that because they won’t value me.” No, they’re going to value you if you provide results, if you’re undeniable, if you’re irreplaceable. It doesn’t matter, right?

Drew McLellan:

Right.

David Valentine:

Yeah, I think it’s really all about how much do you believe in your agency’s ability to deliver?

Drew McLellan:

Yeah. That is an interesting sentence to end this conversation on. How much do you believe in your agency’s ability to deliver? Interesting.

David Valentine:

Yeah.

Drew McLellan:

Dave, this has been fascinating, which I know it would be. Yeah, I’m sure folks are going to want to reach out, they’re going to want to learn more about the work you do, what’s the best way for them to track you down?

David Valentine:

Yeah, you could find me on social media at Realdval. If it’s okay, Drew, I’d love to throw out an offer to your listeners, just a freebie if that’s-

Drew McLellan:

No, it would be out of character if you didn’t do that, Dave, right?

David Valentine:

Here’s the deal. I love agency owners. I’m an agency owner myself, have been for 10 years now. It’s one of the hardest, best things you can do in life. What I’d love to do for your listeners is give them three meetings booked for free through my SDR company. The way that you can take advantage of that, you can send me an email, [email protected]. [email protected]. Mention the podcast title in the headline and I’ll get you set up with a team of people that’ll get you onboarded and set up. They’ll run three meetings free for you, give you an opportunity to see what that’s like to work with an SDR firm, have meetings booked directly on your calendar. If it works out great and if not, you got three meetings for free and I hope you close at least one of them.

Drew McLellan:

Awesome. I love the real practical example as we wrap this up. Thank you, again, for being here. I appreciate it very much.

David Valentine:

Absolutely. Thank you, Drew.

Drew McLellan:

You bet. All right, guys, I suspect this episode has your brain spinning a little bit. I think that Dave pushed on some conceptions that we have in the agency business around value and pricing and how we sell and how we connect with prospects. Take his advice, don’t take his advice, but let it soak for a while. Let it challenge, maybe, some of your perceptions or opinions and give it some thought and see where you can apply any element of what we talked about today, and take advantage of Dave’s free offer. I will tell you right now, Dave and I just met today. We don’t know each other at all, but if I was sitting in your seat, I’d take the free offer. You have nothing to lose, which I guess is the whole point of this interview, is figure out a way to sell in a way that your prospect has nothing to lose by giving you a shot.

Fascinating. Fascinating topic. I can’t wait to hear from some of you about what you thought and what you’re doing differently, if you completely disagree or agree, but I think this was a really thought provoking episode. I suspect, I will be hearing from some of you that you’re going to dabble in some of this. If you do, I want to hear about the results, okay? All right. Of course, I will be back next week with another guest to get you thinking differently and broaden your perspectives like Dave did today. In the meantime, I want to thank our friends at White Label IQ. As you know, they are the presenting sponsor of this podcast. I’m super grateful to them. They’re back for, I think, their third year. Love those guys. They’re great folks. They’ve been in the AMI community for about 20 years. They do White Label design, dev and PPC. If you need some help with any of those things, they are your go-to guys. Head over to whitelabeliq.com/ami. If you’ve never worked with them before, speaking of, they’ll give you some free hours to try that out. Right in alignment with today’s episode.

In the meantime, please know I’m grateful for you and I appreciate you listening. I love meeting you at conferences. I love hearing from you. I will be back next week. In the meantime, have a great week and think a little differently this week. Let’s see. Let’s see what you come up with, all right? Talk to you next week. Thanks for spending some time with us. Visit our website to learn about our workshops, owner peer groups, and download our salary and benefit survey. Be sure you also sign up for our free podcast giveaways at agencymanagementinstitute.com/podcastgiveaway.