Clay is a Chief Outsiders Managing Partner based in Houston. From bringing new ideas to the table, to searching for experts who have a similar problem-solving experience, he applies his unique insights and broad experience to discover the best way to grow a company. As Managing Partner, he also assists and mentors clients who require coaching and advice and ensures that marketing programs and strategies achieve measurable results.
They say that entrepreneurs are made, not born, but Clay Spitz may very well be an exception - entrepreneurship is practically in his DNA. In today's podcast, we talk about Clay's transition from being the Operations guy to the Marketing specialist he is today. We talk about how the marketing game has changed because of the pandemic, and how important it is for businesses to really care about what their customers need and how to stay authentic when communicating with your customers.
Want to see your business grow? Get a copy of The Growth Gears by Art Saxby & Pete Hayes for FREE! Just email Clay here, mention that you heard about the promotion through this podcast and let him know which version of the book you would like (hardcover, Kindle, Audible, Stone Tablets, etc.)
GET IN TOUCH
Mark Leary:
www.linkedin.com/in/markhleary
www.leary.cc
Clay Spitz:
www.facebook.com/clay.spitz
www.chiefoutsiders.com
www.linkedin.com/in/clayspitz/
Production credit:
Engineering / Post-Production: Jim McCarthy
Art / Design: Immanuel Ahiable
Wednesday, September 9, 2020
SUMMARY KEYWORDS
customer, marketing, company, business, people, sales, terminix, transformers, conversation, sell, buyer, prospecting, strategy, market, entrepreneur, thinking, client, learned, understand, competition
SPEAKERS
Clay, Mark
Mark 00:00
So we're rolling, cool. We are live. This is you're doing it wrong with Mark Henderson, Larry, and my name is Mark. And I have a passion that you should feel in control of your life and control of your business. And part of how I do that is by letting you listen in on a conversation between two people who have a passion for excellence in the entrepreneurial world. Talking about a subject you probably already know something about. But this time, we're digging a little bit deeper and giving you some details and nuts and bolts that will help you break through your understanding. So you can break through your ceiling and get what you want from your business and have that better life. So of course, don't forget to subscribe, leave feedback and share with your friends if this episode is helpful to you or to them. So without further ado, I'd like to introduce today's guest, I'm excited friend I've known a while and and seen do some great things. And I'm excited about his wisdom. Because clay, Clay Spitz is a managing partner for chief outsiders, which is a national company populated entirely with chief marketing officers. And he and his team work to discover the best way to grow companies all the time. And so he helps clients and mentors, entrepreneurs who require coaching and advice to really turn their marketing effort and really their marketing money into real money. And so, I would like to introduce my friend clay. So how are you, man? Mark, I'm
Clay 01:33
great. And it is a delight to be with you. Thanks for having me on the podcast.
Mark 01:39
I'm really excited, man. So we were talking before we started recording that you're not just managing partner of this flock of chief marketing officers. You're an entrepreneur by DNA, you started in a family business. Tell me a little bit about that.
Clay 01:54
Well, I did I I grew up with an entrepreneur as a dad. And my
Mark 01:59
dad, that's tough. That's tough, right?
Clay 02:01
Yes. You know, I mean, I grew up in the family business from the time I was a kid, because we talked about it at dinner. And, you know, it was my life. And, interestingly enough, as I grew up, you know, I said, the last thing I want to do is go into this business. We are in the pest control business, which is not a sexy business at all
Mark 02:24
right.
Clay 02:26
But you know, as
Mark 02:28
I've worked with pest control, it's like, that's, that's really hard work. And it's done. I've talked to the pest control people and just the uniforms they're given that, like, makes a difference in their life, like, you know, they get long sleeve shirts. That's, thank you.
Clay 02:41
Yeah, it's hard work. It's hard work. And it's hard work satisfying customers. And it's, it's a tough business. And I grew up in it. You know, my dad started one guy, one truck. And I grew an ice company. I joined a couple years after college. And I did everything in that business. And after several years, so we had a plan for me to transition to run the company. And I did, I became president, I ran every single part of the business and learned a tremendous amount about being an entrepreneur about growing a company about serving customers about dealing with problems. And we went, we went through every recession that there was, and had to deal with that. I learned how to hire people, fire people, cut expenses, grow a company, promote a company, it was an amazing experience, as has been the rest of my career since then.
Mark 03:38
But you've done work and worked for companies like tele check terminix service master. And so you know, you've done the entrepreneurial small thing, you've done the big, lots of big budget things that you kind of know how to connect the dots in small guerrilla type situations where you have no budget as well as how to how to make it work when you're spending the money.
Clay 04:00
That's right. I mean, and I took over as president in 1984 and 1987, we had the opportunity to sell the company. And we sold it to a company called waste management. They they're in the trash hauling business, but they wanted to get into lawn care and pest control. And we were the first acquisition that they made in pest control. And I stayed on with them. And we bought 100 Pest Control companies in two years. Wow. Yeah, I was part of the management team that did that. We had to put them all together and create a new company from nothing. And we became the third largest pest control company in the country. And then our parent company waste management sold us to terminix. And that was a shock. Because, you know at the time, we would never have sold our business to terminix. That was the big bad, you know, giant pest control company, right? The one we hate it turns out, yeah, turned out to be a good company. Okay, yeah, that's
Mark 05:09
what I think that's a common. I don't know where that came up recently. But every, every small company loves to look at the big guys as bad. That's, that's maybe even I were talking about it. And it's it's the buyer, we think all those big companies, you want to work with a big company, it's like, well, you know, the big company got big somehow, it's always that, a bet you that doing something, right? And instead of scoffing at them, you might be well served to learn from them. So that's a that's a maybe a side con. Well,
Clay 05:39
you know, very valuable, because I learned a lot from them. And I learned that you have to respect your competitors as bad as you think that they might be. Oh, yeah, I've heard so many entrepreneurs say yeah, my competitors. They're terrible. All they do is cut the price. They have a lousy product. They give lousy service. Oh, yeah. But they're about 10 times bigger than I am. And they're taking my customers. Yeah. So there's, there's something to be learned. The most interesting thing for me, because I went through this whole thing with the roll up, and we bought all these companies and put them together. And then we got sold. And I said, Oh my God now, now I'm working for terminix. And I've, you know, shrunk my my geographic area to run the Texas region. And I don't think you and I've ever talked about this, but they got me into marketing. Literally the story is I got a call this will tell you how long ago It is Mark, the CEO, Secretary, when we had secretaries, not executive assistants. Okay. Yeah, he called me one day. Was
Mark 06:44
it in black and white? That was it in black and white? Practically? Yeah,
Clay 06:46
almost. She said, I need you in Memphis tomorrow. That was the home office for terminix. And I've got a ticket waiting for you at the ticket counter at the airport. Okay, you probably do not have your Lister. Yeah, I don't know what an airport is. I've been in one in months. I used to be in a lot of them. And they flew me to Memphis, and the CEO of terminix, than the Senior VP of the parent company, then servicemaster asked me to be head of marketing for terminix, VP of Marketing Terminus, $500 million company at this point. Wow. And I looked at them both. And I said, What are you talking about? I'm not a marketing guy. I'm an operations guy. And the Senior VP of Marketing looked at me and he said, No clay, you're a marketing guy, you just don't realize. And that was VP of Marketing. What
Mark 07:40
did they see? What did they see in you? That that made them think and part of why I'm asking this is some insight into what is marketing? Cuz I think a lot of people have think they know what it is. Yeah, but they don't. So when they said, You're a marketing guy, and you don't know it, what did they mean?
Clay 07:56
So what they meant what I said, Why do you think I'm a marketing guy, and the Senior VP of Marketing said, Look, look at it, look at the things you've done, you forced us to do some market research, to figure out what we're doing right what we're doing wrong, and why we're losing business and why we're gaining business because I've not really been an advocate for that I didn't think that terminix the big bad, Big Bad terminix knew enough about their customers. And what you know, natural kinds of pest control today are just so common and chemicals have changed. But back then, I wanted to start a separate service that was an eco friendly Pest Control service, okay. And I came up with a whole idea for the new product that we would go to market with and how we position it and, you know, wanted to do some research around that to make sure that it would it would fly. And so it wasn't anything about advertising. You know, that's what people think marketing is is advertising. But I was strategically thinking about the business. I was thinking about the customers and why we get them and why we lose them, and how we could do a better job getting them and keeping them. And I was thinking about what our customers need. And what could we do to satisfy their needs that we're not doing today. And back then all the terminix did was monthly service. And we lost a lot of business because there were plenty of companies around that were doing quarterly service and other kinds of frequencies that spoke to what the customer wanted. But terminix says no, you know, we earn our best money when we're doing a monthly service. And I convinced him that we needed to offer some options to customers. So it was all around thinking about the customer and what the customer needs. And how do we satisfy those needs of the customer better than our competition that the Senior VP of the parent company says Yeah, you're a marketing guy. And it turns out he was right. Yeah. I mean, I was a right turn in my career. Yeah. So right turn in my career. And, you know, I actually wrote him an email a couple of years ago, because he's still around, but he's retired, thanking him for saying something that in myself that I didn't say,
Mark 10:20
well, there's a lot of wisdom and a lot. There's a lot of richness in the story you're describing, not just in your journey, but in the leadership and there and being around the right people, the best people what, so I'm really impressed. And it's a very inspiring story about you and the leadership team, you were around. And I think, you know, that's the little nuggets of when you look at your competition, when they're really, really bigger. They've got people wandering around there who can spot things like your talent. So don't underestimate that skill, and what you may need as an entrepreneur, to be able to identify skill, even if it's not your skill set, maybe, especially if it's not your skill set.
Clay 11:02
Yeah, yeah, that's right. You know, one of the other lessons for me too, was big companies can learn a lot from small companies. You know, I grew up in a smaller company, but in terminix, I was back looking at what are our smaller competitors doing? That's better than we are? And how do we adapt? You know, how can how can we beat the little David's? Were the Goliath, we think we know it all. But the small guys are out there doing some innovative things that we all learn from.
Mark 11:34
So the story that you described about how you were identified as a marketing guy is just spilling over right now you're like you are obsessed with understanding your customer needs? What do they want? What are they saying? What are they missing? What's going on? what's working, what's not, and I and I love that. So I would love to pivot the original, I usually ask the question, What do you learn about yourself in the last couple months? But I want to ask, what have you learned about market intelligence about learning the customer's voice in such a difficult time? And such a time of trends? rapid transition? What have you learned about learning about the customer over the last few months?
Clay 12:13
Well, first, let me say that, you know, I, I talk to a lot of clients, a lot of prospects that are middle market businesses. And what I see so often is that they've forgotten about the customer, they're so tuned in to what they're doing. And they're tuned in to how they think, and their message and what's good for their business that they forgotten to look outside.
Mark 12:38
Which is the classic example of it works. So well, they stopped doing it. That's when they did because they didn't have to, because they had to initially they weren't gonna sell anything if they didn't do something. And then they started selling something. And he created that distance in it, and it got got comfortable.
Clay 12:52
So what have I learned one of the things that I've learned in our COVID time, so anybody listening to this a year from now might forget that we were in the middle of this pandemic. And that in you know, course of a couple of months, our whole world changed. The customers change, and their needs change, and how they think about things change. And if you don't ask, and there are a lot of different ways you can ask, but if you're not curious, and you don't ask what's going on with your customers, and listen to them, and look, not just listen, but look at how they behave, and respond because they don't always behave the same way they speak. And so you have to kind of sink upstream to, you know, what do you do versus what you say, you got to sync those two up and watch carefully, and be curious and find ways to react to what your customers are up to. And not only your customers, but the competition you got, you got it all the time.
Mark 13:59
So that's a good point, actually. So I think that the cost, there's a polarity of the of the customer types if you're going to learn about your customer. And then there's the third dimension of the competitors. I like that. And so hold on to that thinking, because I think that when when I work with my clients, at one end of the spectrum, there is the complex sale, that involves a lot of consultation, possibly the sales process includes a principal or senior member of the leadership team. And so that intelligence is a little more accessible just as a matter of course. And then the opposite end of the spectrum is very transactional, might be b2b, it might be nuts and bolts, it might be distribution, but you know, something that's just sort of very repetitive and it's very mature. And so that insulation between the senior executive team, the principal, the visionary, the founder, whomever, and like the latest, last 100 transactions might be a mile apart. And if I say what is your customer thinking like I don't, I don't have a clue. Don't talk to them, I don't even know where I would start the conversation with them. My sales reps all know them. So then there's that third dimension, which is well, you can go figure out what the customers or the competition is doing. So kind of walk me through that maybe two or three different scenarios into that recipe book of the complex sale, which I, I guess, to some extent, that may be obvious. So I'm more concerned about like the where the executives in the senior leadership team is more insulated? How do you get them to kind of break down that barrier and get into a spot that they're super uncomfortable with and don't know how to get to.
Clay 15:34
So you know, how you break through the barrier, is you have to think about how you fit into their business. So even a transactional business, you're doing something you're selling a product or selling a service, that makes a difference to your customer. And unless you're just a commodity, and selling commodities is really hard. And there are ways to differentiate yourself, even with a commodity. But if if you're asking how do we fit into your business? What is the widget that I sell? Or the service that I provide? do to make your company run better? And what could I do with my product or my service? Or how I provide them to you? What can I do to make your business better. And if you can take that perspective, now, you can have a conversation with a CEO, or Chief Operating Officer or if your financial, maybe it's a chief financial officer, to better understand their business, because if you're a transactional business, the man or woman that you're selling to purchasing, or you know, just a lower level manager in the company, may not even think about how what you do fits into the company itself. But if you figure out how do I make my customer more profitable? How do I make my customer a more efficient company or lower their cost or make it easier for them to do whatever they do? By selling them the product or service that I sell? Now, you're at a different level, you're way outside, what your competition's typically doing. And you may get some real insight about how you can be better how maybe you need to pivot your or adapt your product or service? or What
Mark 17:39
does that game? Does that game change six months into the COVID? situation? Which is to say, we don't know how many months but till the end, or something we could call it in? We have no idea. How does that game changing? Because it's certainly three or four months ago, it was pretty traumatic. And you would say like, you would not come to the table with Hey, we save you two cents on the on the unit. It's like you have to ask much deeper questions like are you going to survive anyway? What is your your outlook? You know, how can I help you outside the normal bounds? But six months in? What are you seeing a hybrid of this emotional connection approach? And the value approach? Or what what are you telling people? really the goal I'm asking right now is given today, 666 months in? What What work do you have to do to emerge as a leader in your marketplace? Two and three quarters down?
Clay 18:28
Yeah, so great question. I think you have to be thinking about your customer and where they're headed. What, what's the trauma they've been through? And where are they going? Where are they in their journey? And how can you help them? And so, you know, a lot of what we've talked with talked about with some of our clients and our networking partners, is being tone deaf. It's all about, hey, how can I sell you more my stuff, I just want to sell you more. That's, that's tone deaf, they don't necessarily just want to buy more, they may not even need more.
Mark 19:10
So when you say that instantly, imagine the sales rep and kind of out of their depth. Sometimes, especially in those commodity sales organizations, like they want to do better, but they don't know how to do they don't have been trained to do better. Where you've got a principal, on the other hand is like, very capable. But if the principal isn't in the sales process, or in the product management process to get very sophisticated in this, if they're not really in there, you've got a need and a resource and they're not connected. How do you what do you tell companies about that gap? Do you say look, you just got to get out of the office or do you walk them through a process or how do you get the get those those tools in the right spot?
Clay 19:48
Well, I mean, there are a lot of ways to get a customer's point of view. But you know, I go back to something a sales coach taught me several years ago. Terrific sales coach, you know, if you ever saw the movie Glengarry Glen Ross, you know, remember the ABCs of ABCs of selling, always be closing always be closing? Well, my sales coach turned them that into you know, the ABC is an authentic business conversation. That's all you got to do is have an authentic business conversation. Be curious, ask a lot of questions. Learn about the customer's business in any way that you can. And do it in a way that's non threatening. I'm not just asking you questions to sell you my product, I'm asking questions, so I understand what your needs are. And my product might not even be a fit for your needs. And if it's not, that's okay. I just want to understand what your real needs are. And if I can help you solve a problem, then that's what I'm here for. And if you can take that kind of attitude and approach in a conversation with a customer, you may walk away without sale, because their need may be not relevant to what you're selling, but you walk away with a better relationship. The likelihood is if you really understand you really might make a better sale, because your understanding is better.
Mark 21:23
Yeah, so I've coached a lot of people onto this problem. And I want to kind of see what you actually seen the results look like in the field. But with some of the companies that I talked to, they have the information, and they just are able to execute on it. And other companies a couple of things holding back, they're they're fearful, or they've had to change the process so much, it just doesn't really want to flow. And so what I've pushed them is like you have to escalate this conversation up the chain up to leadership team, all the way to the visionary if you have to, until it works, you don't have a choice, you have to keep escalating this quality until you can have truly an authentic business conversation with enough latitude. So if you're selling screws to a company who doesn't sell a product that people buy now, like you can't migrate that iteratively to like a lower and lower price, like they need no screws, they're not selling any product that no one's buying. So you have to stick with that way back and say something like, Well, are you gonna? What can we do for you? I mean, is there anything? Can we repurpose? Can we introduce you to some other people where you can sell your your your product in another marketplace? Or maybe there's nothing you can do, but you got to open that conversation as wide until you get to infinity if you have to that may end with I guess there's nothing and I'm so sorry. And now we're just brothers in the entrepreneurial world, which that are sisters. And so that's a tough conversation that only a leader at the highest level could really have. Yeah. And so I really push people to say like, if you're not if you're getting stonewalled, we know that you gotta go, I've seen that. There's a fear based in the in the marketplace, I've got the principal calling in their customers, and what are you doing nothing? Okay, well, tell me about that. And I got to coach them to the point where you're creating trust, have some conversation, tell them who you are, tell them what's going on your world and create some connection and find out how wide you've got to be. And then ultimately, you can figure out whether these companies are viable. If there's something outside the box and you've built the trust, I'll have open and honest conversations with you. If you're not getting that, you know, you really have to do you have to, or unless you can just kind of wait it out, which is a strategy I don't recommend. So that being said, when I really push entrepreneurs and visionaries that it's their job that like if they're if their machine isn't getting it done, they got to do it. What are you seeing out there? Are you in terms of companies that are viable? You know, I I tend to think that the marketplace right now is traumatized, as it is in ways is extremely viable with very good aggressive companies. Oh, what do you see?
Clay 23:50
Yeah, you know, there were a couple of months where everybody was hunkered down. And nobody wanted to have a conversation. But what I'm seeing is the market in the market is opening back up. People have to figure out how they do business. They can't hunker down anymore. Or they'll just go out of business. And so now they're looking around and saying, Okay, I have to accept I'm in a different environment, how do I survive or flourish, and there are some companies as you will know, that are doing better now in our COVID era than they were before COVID because their product or service happens to be especially relevant. There are others that are okay. And there are others. You know, the restaurant industry is a great example. That are I'd be there just in the dirt right now. And it's a tough time. And you just have to do what you can to survive. And so you have that, the whole continuum. And so, you know, but in every category, including restaurants, there are some companies that have figured out how pivot and find a different way to serve their customers that's relevant for today.
Mark 25:08
Well, that's an interesting thing. And I want to get specific if you can. But I think it's a, it's a, it's a hard to digest problem, because if you're a consulting firm, and you're inspired by the story of a vodka distillery, making hand sanitizer, that's inspiring and useless. Because you can't make hand sanitizer. That's right. So in the restaurant world and other places like that, you know, it's you have to look at your strengths, and you look at the knees. And that's not easiness it's not not what do you see for people doing that? So
Clay 25:41
let me give you a good example, in the restaurant business, and there's probably no tougher category than restaurants right now. But we have a client that's in the restaurant business, and they're kind of a higher end, you know, dine in kind of restaurant. And so selling what they do is people drive through, you know, they don't have a drive thru line. Right, right. Okay, so they don't have drive thru. curbside is okay, but how many people are getting high end meals for curbside? So what they figured out with our help, what are our customers, okay, our customers who like to eat at a high end restaurant have a really nice meal. Well, now they're cooking at home a lot more. And so what if we package up and have a series of nights when they can get a meal for six or a meal for for whatever they need, order in advance, have a very nice meal that they can have packaged up and take home, and warm up for their family and have the same kind of meal they'd have in our restaurant, but have it at home. And so their concept was packaging up a series of meals that could be ordered in advance that could be delivered to their house, or they could come by and pick it up, that was ready to eat could be warmed up in the, in the oven or whatever. And it was the same meal that they would have if they went to the restaurant.
Mark 27:11
So it's quite a box, kind of
Clay 27:12
Yeah. And and you know, it wasn't fast food, it wasn't, you know, run by the barbecue place and get a sandwich, it was a nice meal that they might do a couple of may not do every night, but might do a couple of times a night, this restaurants business stayed at the level, it was okay back up to the level it was before COVID. So their revenue was just as good now as it was before. Because they really thought through not we're gonna sell our stuff at curbside, and you know, have it be cold by the time it gets home. No, we're gonna sell the same meal we have make it easy to have at home, make it so you can order in advance. And either we'll deliver it or they'll come pick it up. And you have a restaurant quality meal at home. And I mean, their business has been doing great.
Mark 28:08
Okay, so this that sounds simple, but I want to unpack it, because there's a lot to it. Oh, yeah. And I think I think the essence is where this whole podcast is started with customer centrism. Yes, which I think is so underserved. And that is, and that's what you're the perfect guy for this. So I love this. Because what I heard was the difference between curbside, which is, well, what can we do as a restaurant? What do we have the capacity to do? We can take it to the curb and that complies, which is so very different than what do they need? What do they want? What a moat? What motivates them? That we can also do, right? And it's like not that different, like you were you described in simple terms, if I had to distill this down, it's exactly the same. It's curbside Raceway is a nice delivery. It doesn't even matter, right? The difference is the job. Oh, this is great, right? who coined the term? Oh, I forgot the guy's name. But he's, you know, What job? Are you hiring the product to do? It's in it. That's the if you can think of who wrote that term. It's really like what function I'm trying I'm trying to entertain a group at a high level, that's totally different job than I need a quick bite. Yeah, totally different job that I'm sick of eating my own food. And so what job Am I hiring you to do is a very three dimensional approach and you can only describe it from the seat
Clay 29:32
of the buyer. Exactly right. You have to either be good at putting yourself in the seat of the buyer, or asking the right questions. The right really insightful, honest questions that get an honest answer that and then you have to understand the answer from the perspective of the buyer. Too many people ask questions and still they've got Their own filters and they hear the answers to the questions in their in their own language and through their own filters. He Well,
Mark 30:07
of course they do. And I'm describing as I'm hearing you talk, I don't know how many hundreds of times I was told and told other people go ask your your client what they want, what they think why they hired you, all those things. Everybody on this podcast is heard, go, go find out why they hired you sound what do you do? You ask them? And what do they say? Oh, cuz we like you? Yeah. They're like us, okay? No, that is not they don't they don't have the words. So you got to really kind of get passionate about like, thanks for that totally unhelpful description of why you hired me. We got to dig deeper, because that's not useful. And I think that's the mislead?
Clay 30:45
Well, number one, you can always accept the first answer. Number two, if you the business owner, or especially if it's your salesperson who's asking that question. The temptation is to ask it in a way, the filter automatically says, oh, how do I sell them more? And you got to stop that. And really think about what are they telling me? And how can I be open? Even to the negatives that come through? How do I explore the things that might be negative for my business? That they don't like as much or I'm not doing as well? Or that I'm not doing at all that they'd like, how can I open up to that, but it's really hard. It's really hard. And so sometimes, as painful as it as it is, you have to get a third party to ask those questions. Because the other part of it is, you know, most of us by nature, avoid conflict. And if you ask your customers,
Mark 31:49
I argue with don't don't wouldn't understand
Clay 31:53
that very true. But if you ask your customer, how am I doing? They normally want it unless they're really bad. They normally want to tell you, Mark doing okay, that's fine. No problem.
Mark 32:05
Yeah. Right.
Clay 32:08
And if Yeah, is there anything I can do better? No, I know, you're pretty good. Pretty good. I like you the way that you don't like the way they are. If a third party says, you know, to Joe, well, how do you like Mark? And what he's doing? And how relevant is it to your business? And who else do you think about when you think about similar kinds of services? And what do they do better than another company? Or if you could have anything you want it in this kind of category? What would you like your service provider to do? Third party can hear those kinds of things. And, and, and elicit honest responses that sometimes the business owner just can't or can't get.
Mark 32:57
And I've heard that argument a lot about third party is that you know, they're they're seen as impartial. And I think that may be true, but having done this a bunch, I don't think that's the highest value. I think the highest value is that you have to be an expert questioner,
Clay 33:13
yes,
Mark 33:14
I don't, I don't think a beginner questioner can get the answer. Even if there is a visionary, and I think it is a bad idea to try, at least without some coaching and guidance, because I think it won't get you what you need. Yes.
Clay 33:26
Well, I Regardless of the reason that you're having the conversation, the better questions you can ask the deeper questions you can ask, the better off you're gonna be.
Mark 33:39
Yeah. And I guess I want to backtrack a little bit, because some people, especially visionaries, who have a marketing background, a sales background, and lots of reps may be expert questioners. And they might really be in command of the voice of the customer. So that I wouldn't want to take a step back and say, self assess if you need to get to the voice of the customer, your client, ask yourself, Am I an expert question? Or am I very close to understanding the voice of my client, which can come from if I was that client, like a lot of people work came from their industry move in, and that puts them in a good seat. But if they're not in that spot, they don't, they didn't grow up in the industry that they're serving? They're not naturally inquisitive. They haven't had lots of conversations with the clients and prospects, then they really got to look at themselves and say, Is this gonna go great? Am I gonna get stonewalled at the first question? Or am I gonna be able to really cut past all those potential roadblocks? unintentional roadblocks, I might add, they're not trying. They don't know. They don't have the vocabulary. They don't even know what you're asking. But actually, I want to introduce the book because we're really into a lot of the content. I think it's in the first gear. So the growth gears book, which is just you know, something we can talk about in the background, but I think it's really relevant and can be helpful, because I think there's a lot of content here that will start to leak out the listeners ears and people will start feeling overwhelmed like I don't I can't remember all these questions and all that. So Let's break down that break down the concept of the growth gears for purposes of compartmentalizing this process we're talking about and maybe we can leave the listeners with some resources to kind of go back afterwards and make this actionable rather than just conceptual. That makes sense. Absolutely. Well, I'll start kind of kind of give us the overview.
Clay 35:17
So let's start with a concept of why we wrote the book and what it is. People today think that marketing is advertising. It's all the stuff that advertising does. And what we see in our business is that most companies, let's call it the middle or the lower middle market, do what we call random acts of marketing. They are doing all kinds of stuff, whether it's emails, or search engine optimization, or television advertising, or print or trade shows, whatever it might be, they're just doing a lot of stuff that they think is marketing. But the problem is there's no foundation underneath it. And so, you know, if you build a house without a foundation and eventually falls down, same thing and all these marketing tactics, if they don't have
Mark 36:09
you just saying that because you work for a foundation repair company?
Clay 36:11
Well, it is one context I have in my brain, right. And so years ago, when we were a much smaller company, today, we're 75 people, all chief marketing officers all over the country, all former senior executives. But when there were 15 of us in the company, our CEO and founder our tax fee, and our co principal PJ started to just have a conversation it was, well, how are you doing engagements? And what do you do when you're putting together a marketing plan. And when you took everything that we all said it was about, well, first, I got to understand what's going on in the market, with my company, with a competition with a customer. And from there, I can start to understand how to develop strategy. And then I do the execution. And we also did a study years ago, in concert with the University of Texas McCombs School of Business, we had them do a market study of mid mid sized companies and what what were the characteristics that made a midsize company grow? And what were those characteristics of those mid sized companies that didn't grow so well. And what we learned was there, you know, as many things there, there's either this or that there's a very operationally focused CEO, who runs a company Well, you know, they've really got their act together. But they're focused inside the four walls of the company. There's a market, not marketing, but market focused CEO, who's always thinking about the outside environment, where's my customer? And what do they need, I got to come up with new products. And now I'm always moving in different directions. And those companies grew really well. But sometimes the wheels were coming off because they weren't as operationally focused as they needed to be. But there was a slice of those companies where there was a market focused executive as part of the team. And when there was somebody on the team, who was bringing the outside, in thinking about the customer, thinking about the competition, all of these different elements that we've been talking about, and brought that perspective into the company. Now you had a company that outgrew their competitors that were in the same space, and grew profitably, because they have the operations, but they also had that outside market focus market based,
Mark 38:49
typically two people
Clay 38:51
is usually two people.
Mark 38:52
Yeah, the reason I say that is it fits very cleanly into the EOS framework of the visionary and the integrator, both senior leaders at the very top of an authoritative and the visionary is about a bigger and bigger buy to the future, big opportunities, big ideas, let's grow and grow and grow. And the integrator is sort of like yeah, and we're gonna put some friction into that, because not every idea is a great idea. Some are awesome, but not all of them. Let's figure out what they are. And let's make the plan happen. Let's follow through. Let's keep the trains running on time. Let's get the customers happy. Let's keep people in the right seats. And so that yin and yang of the future and bigger and on the ground and execution with precision is that yin and yang perfect combination. So I love you for that.
Clay 39:38
So here's what we found is that most of the CEOs that we speak to are very operationally focused. And so we needed a way to talk about marketing as a process that they would understand, not the cool creative stuff that those kids do and run ads and do the digital marketing. But how is marketing a process? And it is. And so the three gears in the growth gears model are insight, leading to strategy leading to execution. And I'll just add a little complication here that the fourth gear is sales, because if all the gears of marketing are turning the way they should, then sales as the fourth gear will be more effective. And you know, if we can if we have time to get into Alex,
Mark 40:30
yeah, but so we know that sales loves to blame marketing and marketing wants to sit loves to blame sales. Absolutely, we have to have both. And those disciplines don't always line up
Clay 40:41
and, and, and to work well, they all need to line up and in our model, they do. But in the, in the insight phase, there are at least three parts of insight. This is what most companies forget, you got to understand yourself, your company, why do you exist? Why are you any better than your competition? What do you bring to the marketplace, that's special about you? When I say you, I mean your company. So if you don't understand that, you're really going to have a problem understanding the rest, because it's all in context, it's got to work together, then you got to understand your customer. Who is your customer, a lot of companies make a big mistake thinking everybody's my customer, right? And everybody unless you're Walmart, everybody's not your customer, you're built to serve a segment of the market, and you serve a segment of the market better than you serve other segments, and hopefully better than your competition does. So if you're going to understand who your ideal customer is, as part of the EOS model as well, who's your ideal customer? What do they care about? It's not what you do for them, it's What problem? are you solving for them? When I sell them a product? What's my product doing that makes their company better? So I got to understand how all this fits in? And what language do they use to talk about the problem that they have? So that I can reflect that in the language that I use to talk about my solution? And how it solves their problem?
Mark 42:29
And that language question. That's I think that's where people get sort of stuck. And I and I've had multiple podcasts where the theme is where we as experts get so comfortable with our language and jargon and technical specificity, that we think we've simplified our language. And we haven't even come close to that to the very fundamental language that our customer is comfortable with.
Clay 42:51
Yeah, that's exactly right. And you've got to speak their language in order to relate well, for them to know why they should buy from you instead of somebody else.
Mark 43:03
Which to the point is, you know, especially in b2b, when we've got a technical sale, and it's like, Oh, it's so fast, and it's hard and strong and heavy and light, and all this No, it's 1010 pounds, and yes, in 100 miles an hour. And that's fine. And that may be true. And that might be fit for purpose, and that might be quality. But the reason they're talking to you, is an emotional need. And if you don't have a conversation in your marketing, that is entirely emotionally motivated, you are missing the boat, period.
Clay 43:30
That's very true. And I'll go off on a tactical tangent, but it's so related to this piece. Look at almost every website out there. Almost every website, there's an about us, that talks about how we got here, and how great we are and why we do what we do blah, blah, blah, nobody really cares. And there are all kinds of things about what we do our product or service, how we do it, blah, blah, blah, and very little about the customers problem that we're here to solve. And that's all the customer cares about, is what's my problem? And how are you going to solve that better than somebody else. And so if you don't speak in, in those terms, and I understand your problem, or help me understand your problem, so I can bring the right solution to you. If it's just this is what we do. And this is how you know the dimensions and the weight and the features and the benefits. And let me tell you how great it is. You're talking past the customer, because the customer only cares about themselves and their need. They don't care about you, other than Can you solve my problem. So really critical to understand and speak in that language. And then you know back to our conversation about competition. You got to understand the good and the bad of the competition. So you know how to position yourself? How? Why are you better than them at some things, so you can be relevant to your customer where that part that's better is important to the customer. You
Mark 45:19
know, it's so I, I don't know why this is stealing so new to me, but this idea of seeing your competition as cuz I've always wanted, I know, you need to know about them. But today just sort of clicked that. Well, they're your market research. The part of it? Yeah, like they've done work that you haven't Yeah, like, you know, maybe some of its working some of its not, but go figure out what they've learned. They're more feet on the street, they're trying stuff, you know, and your customers might tell you that they like their stuff, parts of their stuff better. And, you know, that's, that's easy conversation to have. It's just,
Clay 45:54
you know, there's a lot to learn from them. And you might even see gaps in the marketplace needs that they're not serving that you could serve very well. So especially if it's a you know, you're the David and the competition's a Goliath? Well, you know, what's my slingshot that's gonna, you know, knock them out, because they can't serve the customer the way this customer wants to be served.
Mark 46:18
So what do you what do you tell somebody who's in a market where the market is relatively immature? And maybe this is a size thing? Maybe that maybe that's part of the issue. But I do see that when somebody so our competition is terrible. And you go to the puppet competition website, you're like, yeah, they look pretty terrible. Yeah, might be right. So is there like, you know, take we'll take another look, you know, and maybe see, there's some wisdom in there, or what's your advice for that kind of marketplace, because we're, you know, especially in Texas, in the south, there's a lot of industrial, you know, he go to the website of very successful companies, yeah, who may not sell to their website at all. And so doing competitive research might be trickier.
Clay 46:57
It is trickier. But you know, I'll tell you, they do sell through the website, in one way or the other, but we need to talk about the buyers journey is part of strategy. Because that's the first place that any buyer goes, is the website. And so if the, if it's an immature market, your competition is not very good at that, well, that's an even better opportunity for you to be better at it, and meet the needs of your customer better and give you more traction. So
Mark 47:27
yeah, I think that what I've gone wrong on that is not is assuming that newer or younger, or flashier or something is better. Because what I was gonna kind of not contradict you. But in my mind, I had this contradiction, like if I, if I'm selling nuts and bolts, and I look at all the competition, everybody's nuts and bolts is very plain, and there's no pictures of people. And it's just kind of like parts list. And it looks like it's from the 90s. And I'm like, you know, that's kind of the where the buyer is, you probably shouldn't just like, depart from that. And I think that's probably true, I don't think you go, Oh, I like the Amazon site better. Let's make like the Amazon site, you better know if your customer is going to be comfortable with an Amazon looking site or not. And I think that's the the message like you do have the opportunity to beat them out. But it does, but you better know what they want. And I don't think that that easy.
Clay 48:17
That's right, I'll go off a little bit of a tangent here. And I'll talk about a product that I always thought was so basic transformers, you know, you look up the light pole and you see a gray transformer. And there are companies that make those by the 1000s and sell them to the utility companies by the 1000s. It's kind of like, you know, selling screws. Yeah, but I know a company that is a niche company growing 30%, year over year, forget about COVID, that doesn't matter to them, they're still growing amazingly well, because they found a niche in the market to make custom transformers. Custom might be a color, it might be a size, it might be a different Don't ask me about Transformers other than might be a different kind of step up or a different kind of step down or different voltage, whatever. But it's different. It's not they don't make 1000s of they make them custom. And plenty of people that need custom transformers. So they have found a niche. And they don't sell on price. They sell on value. And they focus on what they do. They're not trying to compete with the guy that makes you know, 1000 gray Transformers a day. There, they figured out how to be a niche in what is generally a commodity business.
Mark 49:41
And so when you work with a company who's think this is where I, I don't have any transformer companies around, I listened to this podcast, but there's probably somebody thinking, you know what, we just saw a bunch of commodities and we can do custom version of that. So you get a client and they say, you know what, we've been doing the same old Transformers for 50 years. We want to do custom Some, that's either a great idea or a terrible idea, right? How do you help them through that?
Clay 50:04
Well, let's go back to the insight piece, you got to go find out. Does anybody care about custom Transformers? Number one? Is there competition out there that's already doing it. If they're successful competition that tells you there's a market for it. And you start to go to potential customers. And he asked the right questions. What kind of Transformers D is kind of problems? Do you see when you're ordering Transformers? Do you have any special needs that your big supplier can't? can't serve? Well? Or what's your delivery time? And what kind of delivery time do you need? And if it takes you six weeks to get a custom transformer, and you can get one, but it's expensive and takes forever? What if, you know, you have a supplier that could do your custom transformer exactly to your specs? And, you know, having two weeks? So, you know, it's all these kinds of questions. And, and if you started to get answers that customer, we don't need any custom, we buy whatever is off the shelf, and it's just fine and no problem. Right? Yeah.
Mark 51:16
Well, that's so that's true. And at the same time, you know what, I think this is a good yin and yang conversation, because you were saying, you know, we got to ask, because you're obsessed with it with the market position. And they're the market, the voice of the market. I love that. And me I'm saying, well, that may be true. But if your leadership team and your visionary instincts and the kind of things you'd like to innovate to, or not custom at all, you know, you have to ask yourself, is that in your heart? And this is I mean, Jim Collins, yeah. What's your purpose cause or passion, that, that lines up with something that people need, which lines up with something that's profitable. And so all three of those together in EOS, it's the purpose cause or passion and your niche. And so if you're looking at changing your niche, you you got to understand the costs that go with them? Or is this in your niche? So I do think it's really important with, obviously, this is obvious, but I think people skip this. And that is do the work? Do? Would they buy it too? And do the work? Is this our game to play? Or is this a shiny thing?
Clay 52:12
Yeah, the answer is never that obvious, is to Oh, well, I'm commodity I ought to be custom. And so let me do that. Because you may not be able to do that. Right? Well, if that's not in your heart, if you don't understand it, it may not be the right answer, there may be some other answer for how you compete. So just because I said, you know, commodity versus custom, that doesn't mean customer is always the answer. You do have to know what you're good. Maybe you're good at being the lowest cost provider. Yeah, so Exactly. How do you do that better? You know,
Mark 52:51
and that's, that's a tough one, because people love to put it all sales methodologies, all marketing methodologies kind of push to like, the only thing you got to compete on is price, then you know, you're always going to be in this really, bottom feeder type of
Clay 53:02
world. And then something else.
Mark 53:05
Yeah, price and sums. And both that can be helpful. And I do think price is very measurable. And I do think you shouldn't dismiss it. And so cautiously, I say that most of the time, it's not price. Yeah. And but but if it is price, you better square off with it. And I think you shouldn't dismiss it. Because if you are the Walmart, then be the Walmart, you're just probably not
Clay 53:32
this problem. Yeah, it's it's a hard spot to be. Because you have to have a lot of other things going for you to be the lowest price provider and still make a profit, you know, do the things you need to do so. But I have to get into that part of it. But I do want to move on.
Mark 53:49
Are we in the gear? So subtract, I wanna make sure yeah, this up. So give you the Give me the mic back
Clay 53:55
insight. So customer, competition and yourself. Now, once you understand those things, then you can start to develop strategy. And you know, there are a lot of business owners strategy. I don't have time for all of that. I don't want to think about that. I need to run my business. Right?
Mark 54:16
That sounds expensive. It sounds like consultants. It sounds like a 500 page document that I'll never read. Yeah, I get that our strategy scares me too.
Clay 54:25
And there are a few elements of strategy that are really important to think through. Remember, a few minutes ago, we talked about you can't be everything to everybody. Right? Almost nobody can do that. Or do it well. So who are you best for? And how do you segment the market? segmentation is a real key part of developing a marketing strategy. I can't be everything to everybody because I can't produce that way and I can't do the quality I want everybody's not a good customer. So what is it Good customer to me. What are the characteristics? Is it size? Is it geography? Is it the amount that they buy? Is it their buying cycle? I mean, there could be a million different is it quality over price is a price over quality, there are a lot of different ways to think about segmenting the market. But getting to that segmentation of Who am I able to best serve is really important. We've had a lot of clients where we said, Stop trying to serve all of these different market segments, focus on one or a few. And when they did their business cup better, everybody's afraid to give up an opportunity. Oh, I got a customer who's asking me for some off the wall thing that I don't do. But I don't want to tell him No. And so I got to come up with a way to satisfy their need. No, no, no, that takes you off the track and takes you away from what you're good at. And so if you know what you're good at, and you can find the right segments to focus on, and be really great at that in your segments. That's important strategy. And then positioning yourself who am I to my customer? Okay, so for what I do, and for those who need it, my company is best because that's that's a very simple but you know, direct positioning statement that identifies what you're good at, that identifies who the customer is, talks about why they should buy from you, what's a reason to believe that you're the right supplier? When you understand that position, along with the insights of the customer, now you can create messaging strategy. And so when you craft your messaging, to talk about the customer's problem and how you solve it, now you're having a relevant conversation, whether it's really a conversation or a message out to the customer. All of those, those are just three basic pieces of strategy we could get into pricing, pricing is strategy, really important strategy. Yeah, for sure. All kinds of even what product you provide product or service and how it fits the market? And do I need to adjust it? Do I need to bundle or unbundle or, you know, so all of these, what's my offering to the market? And is it the right offering?
Mark 57:37
Right? And so in EOS, we're, we're working with the entire business. And so when we talk about marketing strategy, and it is interesting that we included that word because it I do think it can turn people off as a word. But I think when we describe the EOS tool, I think it's great because it enrolls entrepreneurs into a sense of strategy isn't scary, because an EOS marketing strategy, marketing strategy is just two things. Who do we talk to? And what do we tell them? Right, which there's, there can be a lot to that. But from a simplified entrepreneurial perspective, we can get some pretty good work started in a short amount of time, that can really get the leadership team on the same page about what we're doing with that, and it can be very powerful. And from there, we've got that platform you talked about, it's kind of that foundation, that you know, what, what do we do, and then obviously, we're gonna talk to the execution side of that. And I do think I do think that people listening to this, if you hear the word strategy, and associated to marketing, like, let go, it's not bad, you have to have it. You have to have it, you have to know who you're talking to. And you have to know what to say. It can get complicated from there, but only if you want it to be That's right.
Clay 58:51
And, you know, let me share with your audience a very easy way to understand this. Because we took the whole growth gears book, and condensed it into a 15 minute video that's on the website, the book is easy to find it's growth gears.com.
Mark 59:09
That's an easy enough, there's
Clay 59:11
a resources section. So tab across the top, that's the third tab resources. And there's a video there that summarizes the book in 15 minutes. Anybody can spend 15 minutes learning about this and seeing that strategy is not so esoteric, and it's not something that, you know, we got to have, you know, our executive team together for for three weeks in a room to come up with its basic things to think about the business. And if you don't, then you're relegated to the random acts of marketing. Right. And so and I'll make an offer right here now to your listeners that if anybody wants a copy of the book, the growth gears and not have to pay for it. I'll give it to you for free and hardback. Kindle or an audible version. So we got it all all kinds of ways. Just send me an email, and tell me you heard the podcast, and you want a copy of the book, and I'll send it out to you at no cost. And my emails really easy. It's clay at Chief outsiders.com. And I'm happy to provide a copy of the book to anybody. And, you know, I, I recommend to any entrepreneur, that they read this book as a primer on marketing. It's used in the University of Texas Business School, as a textbook, and a number of other business schools as a as a textbook, because it is so critical and basic to thinking about marketing. And, you know, that's awesome. We've talked about I
Mark 1:00:44
want to pause, but I really appreciate that because like, it's not a normal part of the podcast, and we're giving stuff away. And so I'm glad that you can do that we'll make sure the link in the notes to that are in the in the show notes. And, and I believe what you're saying is important and true. I do think that marketing is something that entrepreneurs think they know more about than they do. And then when they want to learn it, it'd be it's harder to learn than they want to be because they're trying to buy from program Matic tacticians, people who are doing digital marketing and website creation and all this kind of stuff who are not strategic at all they are they are very tactical. And so it becomes very difficult to take the steps backwards that they need to to be aligned to get what they need. So thank you for that that's a big, it's a big gift, I think it can really make a big difference.
Clay 1:01:31
Well, I'm happy to do it. Because as you know, I am passionate about business owners understanding the marketing side of their business. Now, sure, another quick thought with you because most of our clients are b2b companies. And when people think about marketing, they think, oh, consumer products and marketing is a consumer type of of activity that companies need to do. But every company needs to do it. And the way, the way I express it sometimes is that consumer focused companies grow up with marketing in their DNA, if they don't have marketing, from the very beginning of their business, as a consumer focused business, they'll never make it. But b2b companies grow up with sales in their DNA. And they understand sales. And it's what they think about. They don't think about marketing until sales is no longer able to scale the company. And then they've got to really start thinking about how do I understand my market? How do I have that strategy to position myself and have the right messaging, have the right pricing, and then do the right tactics and the right tactics are not advertising for a lot of companies? You know,
Mark 1:02:46
so when I want to add a word to the vocabulary, because I've recently found it to be helpful in the conversation, and it is sales and marketing, and I and I draw it funnels all the time, there's a marketing funnel, a sales funnel, and there's an operations funnel. This is this is the lifecycle of your client from you never heard of you too interested in buying into becoming a former client or whatever the process is. But when when sales, sales and marketing get confused about growth, and how can we grow with we didn't have marketing? Well, we must have been marketing, because we were somehow reaching out to people. And so the term that I add to this is prospecting. So sales is closing the deals. prospecting is a sales function of marketing, or brain, it is a sales function that does the marketing capacity. And so the specific symptom is when sales driven prospecting can no longer meet the needs of growing the company. And when you'd full on dedicated marketing. In addition, in most cases, to sales driven prospecting, some organizations don't have any prospecting in the sales team, order taking that's a wonderful life, if you can do it. Most of the companies I work with, there is some load of prospecting that still sits on the sales reps, even when there's a big marketing investment.
Clay 1:03:57
So great point. And let me let me go back to a term that I used a little while ago that just kind of popped in there about 15 minutes ago called the buyers journey. And now we're back on the customer side of the equation. And if you think about what does a buyer go through, from the time they recognize a need, until the time they make a purchase to solve the need. That's the buyers journey. And for some of us old folks around if you think back, you know, in a b2b environment, we, you know, a buyer used to find in the Yellow Pages because they're paging through because they had a need, and I got to look for a supplier or they saw you at a trade show, or maybe they saw an ad someplace, pick up a phone, talk to a salesperson, the salesperson has all the knowledge about the product and service. They give that to the prospect. And now we see if there's a match and you know, sales takes it from there. Thank god Very early in the funnel, sales got the hand off early in the funnel from the time of that buyer sharing today, the buyers journey takes place 50 to 80%. Online, before the prospect ever engages in a conversation with a salesperson. What does that mean? It means the salesperson now, is it a much bigger disadvantage? Number one, do they even get the call, because the company has to be good at the top of the funnel marketing, to even get the awareness of the buyer who's looking for a solution. And then they've got to be good at how they manage their online presence. That's why the website, even in a manufacturing or industrial service company, is so important. Because the buyer is goes to Google and sees who comes up at the top of search, then goes to the website, and very quickly makes a judgment, are you relevant to me? Are you able to solve my problem or not? If not, you're out of here, and I'm on to the next one. So now you've lost the opportunity all together, you never get the call. But if you're good at that middle of the funnel, engaging the prospect now to fill out a form, make a phone call, send an email, whatever they do, and now you have an opportunity to bring them across the finish line. And so marketing if you if you think of sales and marketing as one funnel, and marketing is the bigger part of the funnel, and it's got to create the awareness and generate some kind of interest. And eventually we have a conversation and we make a proposal, or give them a price or whatever it is and get them to the bottom of funnel where they become a customer marketing has a much bigger part of that funnel than they used to and sales as a smaller part.
Mark 1:07:01
Well, I would and I think I want to draw some attention to comparison between companies who are recognizing they're not, because what you described of the whole buyer journey that you never see, is truly invisible to the company who's not doing that. That's right. And so that outbound prospecting of calling a prospect, you have a different buyers journey experience, like you called them, they you introduced yourself to them, and you had a conversation with them to either yes or no, right somewhere in the process, or ghosting or whatever happened in the process. And that's your view on the world. And so companies that don't do any digital marketing don't do much in the in the email world, or whatever they're doing their marketing, they don't have any of this data, they could easily and many of them do so well. Our clients don't buy that way. Well, the clients you sell to don't buy that way. That's true. But your industry may not be where you think you are. And you're gonna have to find out where where the rest of the industry is if you're going to enter it.
Clay 1:07:59
Well, there are lots of other things we could talk about. But Mackenzie's done studies and other people have done studies that show how much of the buyers journey has gone online. And in in COVID times, you know, the way we think about it, what, let's call it adoption of digital marketing and sales practices have been changing. But what would have taken place in the next three to five years of adoption of those kind of practices, has been crammed into three to five months. Because we can't make the sales calls, we can't go to the trade shows we can't do the things we used to do. And buyers can't engage with sellers the way they used to. And so they're going online, and learning how to do that very quickly. And if the seller is not matching the buyer in that journey, then you get left behind.
Mark 1:08:54
Yeah. Yeah, it's it's the demands have changed and the friction has to be low. That's right. If it's if it's like, it's a harsh contrast, but you think 20 years ago, maybe longer, I think maybe longer. But you know, the old model of like, in the old days, you had to like send off for information like a write a letter. Send me the catalog. A few weeks later, the catalog shows
1:09:19
right out of college.
Mark 1:09:22
And now it's like I think I need a transformer today. Who can give me the right transformer this afternoon. That's a very different now obviously COVID supply supply chain has made it hard, but those decisions don't become that fast. Now
Clay 1:09:39
they do. They do and you just have to you have to understand how the buyer buys in order to be successful at selling to them. Yeah. And so the part we didn't talk about on the growth gears insights strategy, the execution piece, we could talk for days about marketing execution. Because it is so complex, you know, when when I started in marketing, there was radio, television, print, some trade shows, other kinds of things that that we did. But today, there are 1000s of marketing execution tools that you can use to get your message to a buyer.
1:10:21
Yeah, an overwhelming amount overwhelming.
Clay 1:10:25
And you know, marketing not, you probably remember the old saying I'd cut out half of my marketing expense, if I only knew which have to cut. Well, we
Mark 1:10:37
know having works, we know. But we don't know.
Clay 1:10:42
Well, today, everything is almost infinitely measurable. The problem is you get data overload. And you can measure so many things. But what's important, you know, out of 900 things you can measure, they're probably 895 that are important, right? I'm sorry, 895. That are not and five. Right. So
Mark 1:11:02
and I think many people on this podcast have hired a digital advertising firm. And they went to that meeting. Yes. And that meeting was a spreadsheet or a spreadsheet looking thing with conversions and click throughs and percentages and cost per click, and they would get to the end. And like, I have no idea, no idea what I just
Clay 1:11:23
saw. And in the customers mind thinking, and I've heard them, you know, say this directly, all I really care about is didn't get sales.
Mark 1:11:34
Yeah. Well, that's actually what happens is they, you know, happens, and this happened to me, I gotta be honest. It's like, that was awesome. We're going the right direction. Yeah. And then somebody says, like, how many customers never crossed my mind? never crossed my mind.
1:11:51
Down, I saw the conversion going up on the right direction. That's gotta be good. Yeah, but it customers prospects, hmm. Okay, yeah, dang,
Clay 1:11:59
yeah. But those are the things that are easy to measure that with all due respect to the digital marketing agencies, because some of them are really quite good. But they need that direction. And if the customer doesn't give them that direction, then they'll go down the path of click through rates and all those kind of things, but never get to, how do we get from a click to money in the bank. And the money of a bank is the only thing that matters in the end. So what are those measurements that predict that we're going from a click to a conversion to a conversation to a sale, that's what's important to measuring marketing. So that's,
Mark 1:12:42
so it's all part of 1,000,000%. And then the number one pitfall I see is, of course, if you skipping the inside and skipping the strategy, that you're gonna likely make this execution error. And that is, the classic entrepreneurial mistake is I'm gonna hire a marketing company who's gonna do marketing. And what they hire is a digital agency, a PR firm, a brand company, or any one of the common tool sets, and they have like a skill set. And they're great at doing logos and graphic design that you're going to love. And they have no idea how to monetize it, or they're doing digital, and your customer doesn't really have the same digital value, like they might be a high value complex sale, where you need to market in a very different way. And you've got to have outbound, you know, outside sales, or is it is so common that they just start at the first person who says, I'm marketer. And then they get into this execution. And they've got not just a random act of marketing, they've got a commitment to long
1:13:44
term,
Mark 1:13:47
the same random tactic for a year or two. That's right. And I mean, and I get the idea that, especially with digital, they say something like, well, we got to commit to at least six or seven months, you're not gonna get any results. And so they've committed long term to a random string
Clay 1:14:01
tactic. And so you know, let me let me give you a simple analogy that really speaks to this, you know, if you wanted to build a house, and a carpenter came along, and he said, I like your carpentry build me a house. And the carpenter said, What's the house supposed to look like?
1:14:23
Well, yeah, I
Clay 1:14:24
don't know. Just build me a house. Well, I
1:14:27
like your design aesthetic, something you would like?
Clay 1:14:31
No, you got to have a plan. You got to have, you know, a structure of what it's going to be so the carpenter knows what the outcome has to look like. Same thing in marketing. You got to have some understanding of what is this supposed to look like? What is success out of all this? So I can guide the trades that are going to help you build the house.
Mark 1:14:57
And so that is the problem. The market Marketing is governed by the trades, like that's what people buy to go right to the trades, and they don't buy from that design architecture leadership strategy. Why is that? And what do we do about that? Because it's costing all of these companies, everything in terms of their marketing dollars, most marketing dollars, I'm convinced most marketing dollars being spent in small and midsize businesses are totally being wasted. That's right. And it's because they don't do this work. How do we fix that problem? Well,
Clay 1:15:32
I mean, that's what we're in business for, I'm always thinking about how do we fix this problem, you got to fix the head of the entrepreneur, to say, I'm willing to take the time to think through what it is I'm trying to do, rather than just go out and continue my random acts of marketing. And I'm, you know, the growth gears is a great tool for somebody to do that. I'm not saying they gotta hire us. Somebody who's really intent on this, the growth gears is so simple. It's not so simple. But Instructure? Yes,
Mark 1:16:05
well, it's simple, not easy. Conceptually, I
Clay 1:16:08
mean, like EOS, you know, you could hand somebody all the tools of EOS and the book, and say, and there are some companies that self implement some jerk to it, well, some don't, but it can be done. Same thing with the growth gears, if somebody's willing to do the work. The growth gears is a guidebook for that. And you
Mark 1:16:31
love that I know this can sound a little like promoting the book. But I think it's so important is a super valuable, I really see companies struggle here. And, and I do think that, you know, my constant encouragement for companies is to find a way to get ahold of that strategy. And that, that that real overview thinking, who is your customer? What Who are you? And you have to do a little bit it within budget, right? I think maybe the big fear. Like when I did this work, for the first time, I couldn't believe the amount of money I was spending on a couple of pages of words. And I was like, the logo, man. Yeah, like, this is not fun. Yeah, forget,
Clay 1:17:13
the logo was so nothing like the last day.
Mark 1:17:17
So that was really disillusioning for me. But after years of experimentation, and trial and error, I was like, Ah, you know, the black and white the words of who we are, and who we're talking to, actually is the most important part of this, every company, every company to every single size, even if it's an individual, you have to know this, and you have to right size it, you have to get in the budget. And if you're at the size of company, it's just an individual practitioner, you're probably gonna have to read a book, that's probably your budget 1995. And as you work your way up, it might be 1000, a couple 1000. And as you get to where that where you've gotten real market moving, and potential, you gotta gotta buckle up. Because you're gonna lose much more than if you don't, well,
Clay 1:17:57
that's exactly right, companies spend 1000s 10s of 1000s, sometimes hundreds of 1000s of dollars on marketing, and they have no idea what they're getting out of it. And most of the time, it's wasted. It's really unfortunate.
Mark 1:18:11
I've never seen companies waste more money faster than on marketing and I'm a student of marketing I love marketing and branding. And and I do you believe because of the way it works, all the assets are intangible. You can't you can create I mean, marketing assets, or like maybe logos but hopefully lists and certainly language and market intelligence and and things that you that are actionable. But you know, if they're if they're done wrong, people house like you've got a house, right? Like, you may not like the house, but it's probably got a roof. It's probably got windows, it's probably got doors. But like in the marketing world, like none of that's necessarily true. You might not have any of that stuff. It might be you might not have anything useful at all. And so I'd Yeah, you're really got to take a step back and get an understand of yourself your client and build a strategy. Exactly right. Well, what else did we do we miss in the growth gears? I love that the books out there, is there something you want to share about that, that I pushed us through too fast?
Clay 1:19:08
Well, I think we covered the growth gears pretty well. We didn't spend a lot of time on execution. But for me, execution. Let me say this carefully. Not that execution is easy. But execution becomes much more obvious. Once you have the insights and have the strategy. And you know, even things like budget, I'll give you one more thing that I think is really important, because I have so many people say well, how much of my revenue Should I spend on marketing? What what's the average the companies in my industry spend on marketing? And, you know, I mean, it can go from a half a percent or less to 20%. I don't know what the answer is, but here's a rational way to come up with an answer to how much should I spend on marketing. What's the lifetime value? You have a customer. And it may just be it's transactional I, you know, it's the margin I make on one widget that I sell. Or it may be once I have a customer, I have them for 10 years. And I know what that's worth to me. Now, when I get that down to margin, and I get it down to profit, on my average customer lifetime value, how much can I afford? How much am I willing to invest? To get that customer? And that ends up being cost of acquisition of a customer? If you ever watched Shark Tank? You know, Kevin O'Leary is famous for saying, What's your customer acquisition cost? And most of the entrepreneurs on Shark Tank? Yeah,
1:20:47
I don't know.
Mark 1:20:49
Right, right. But you
Clay 1:20:50
got to know, you got to know what your acquisition cost is? And how much can you afford to pay to get a customer and make a profit? And then you can figure out how to work that all the way back up to the top of the funnel, to know how much can I pay to get a lead, that I know how it's going to convert through the funnel, and get me a customer at a profitable cost of acquisition. That's a lot more difficult than it sounds. But it can be done, sometimes you need your accountants help to figure it out. But thinking through a marketing budget is not just X percent of my revenue. It's really, you know, what am I going to spend? And how do I know what I'm going to get for it? And is that profitable for me to do?
Mark 1:21:41
Yeah. And I do think that you want to pull out the capex and the optics on that too. And so it a lot of people approach it as an optics, only the same reason that they're starting with the execution, they're not thinking about what work do we need to do. But I think it's important to bring that into into the picture, because the capex stuff is, you know, it's this brand, identity insight, stuff that you don't have to do over and over. You don't like you have to do it once. And you may have to tweak it and stay keep the conversation going. But it doesn't, it isn't a forever thing. The and so once you go into the topic side of like, what do we need to do ongoing? It's dynamic, like, you know, what can we afford this year? What should we try this year? What are we willing to experiment with this year, and then ratchet it down next year or ratcheted up next year. And when you have done that work, you have the insight, you have the strategy, you have the confidence that you're can repeat stuff and keep going, because what ends up happening, he's about the randomness. I've done this, and I've seen this 100 times, is you try a campaign, and it doesn't work. So you try a different campaign. And well, somebody told me, I gotta be persistent. So I ran it twice or three times, and it didn't work. And so and so but then I gave up on it. And then you know, you don't know that you're on the right track, because you haven't done the homework, to have the confidence and conviction that you can stick with your slow and steady, affordable routine will eventually pay off. Yeah, that's right. What that is what we know that it is more than anything, that slow and steady, consistent routine that pays off, it's not about shattering the market with the best message that's really pretty rare.
Clay 1:23:16
Yeah, it is rare. And the other thing that's valuable to think about is once you have that I have the basics of what works, then you can start to say I know the metrics of what, what's working, let me try some things to see if I can do better call it a champion challenger model, I've got what works. Let me challenge that with a little bit of my budget, and see if I can find some ways to improve that maybe use some newer marketing techniques or whatever it is, but then you got a comparison. And it either got it was either better or it wasn't better if it's better do more of that. And then you know, you got a new champion, keep challenging it See what you can do to to ramp it up. So you know, those are all things that really good marketing does to always keep improving because what worked yesterday doesn't necessarily work today. So you've always got some tactics in terms of the tactics Yes, that's right.
Mark 1:24:15
Yeah, the strategy Yeah, strategy to migrate and you in life in world changing events can shatter that a little bit. But that's not what happens quarter on quarter. That's that's generally that's that stays pretty consistent. That's, well, this has been great man. I love the content. I love what we're doing. I love the offer for the free book. And we'll leave information about that in the show notes and so people can reach out to you to get a copy of the book. What to wrap us up and bring us home. What is your passionate plea to entrepreneurs right now.
Clay 1:24:51
Mark, this might sound obvious in the context of the conversation we've had. Understand your customer understand them authentically understand them deeply and prepared to, to, to understand what kind of help they need, not just what can I sell? But what's my customer need? If I can't provide it, let me find a way to help them find what they need, because that'll deepen my relationship with them. Yeah, but you've said it, a lot of times, I'm really passionate about the need of an entrepreneur, business owner, to understand their customer from their customer's point of view. And that drives so many important things for a business.
Mark 1:25:40
I couldn't agree more. It's a beautiful point. It's a perfect point. It's something that I can look at my clients and the people I've worked with over the last 1015 years. And it's clear that the the leaders, especially the visionary entrepreneur, the closer they are to the needs and the psych, psycho, psychographic. The Psychology of that buyer, the better everything is for them, they can sell better, they can speak their language, the whole company looks like an entity who's in place, and purposeful, to help that client and that customer. And if there's distance, if there's a fear of those conversations, it just slows the organization down and it creates, it's a slow growth company. So that's right, I could not put a higher premium on exactly what you said. That's awesome. Thanks for sharing that. Well, this is time to wrap it up. We've been going, you know, this has been great. This is high value. We can do this all day. And it's to the point where I don't think we've taken off the rest of it. We might do this again in a couple months or something like that, and see what we've learned over the next couple quarters. And I think it'd be interesting to kind of compare to see what we've learned because we're making a lot of bets or making a lot of hypotheses. In the end, I'm thinking I'm feeling like we don't change the strategy to too much given all the podcasts I've done over the last three or four months. When I asked how are we doing it differently? The answer ends up being like not that differently, maybe a little more urgently, a little more focused, but the rules of the game really haven't changed. So if somebody wants to continue the conversation with you before our next time, how does somebody find you
Clay 1:27:12
so very easy. My name is kind of unusual. So you can find me on LinkedIn very easily. Clay Spitz SPI Tz my email address is also simple clay a Chief outsiders.com. So between those two ways, I can't hide from anybody.
Mark 1:27:28
Yeah, absolutely. And also, man, that's awesome. That's perfect.
Clay 1:27:32
Thank you, Mark. You're a great interviewer. It's a delight, just you know, we've had a conversation, and I and I love that. And I've had a good time, and I appreciate it.
Mark 1:27:42
I really have to and this is obviously a subject that I like to talk about, and I felt good, feel energized. And I hope you've enjoyed the time and I'm really excited that I think the listeners are going to get a lot out of this. So it's one I'm really happy to promote. So that's it for today. So if you thought this was valuable, please subscribe, share it with your friends who can use this information. And of course, leave feedback. This is you're doing it wrong with Mark Henderson Leary for more episodes, and to subscribe, go to lyric.cc