Grow your agency by developing relationships at scale (featuring Dan Englander)

The following is a computer-generated transcript. Please listen to the audio to confirm accuracy.

Chip Griffin: Hello, and welcome to another episode of Chats with Chip. I’m your host Chip Griffin, the founder of SAGA, the Small Agency Growth Alliance. And I am delighted to have with me here, Dan Englander, the founder and CEO of Sales Schema. Welcome to the show, Dan.

Dan Englander: Chip, a pleasure to be on again. Thank you.

Chip Griffin: It is great to have you on again and today we’re going to get to talk about your new book.

Let’s see if I can get it here for those in viewer land, Relationship Sales at – oh, take my finger off – at Scale. I’m not very good at this, am I? But I’m not a TV host. So I have a face made for radio and apparently…

Dan Englander: My copy’s not even at arms length, so you’re better than I am right now.

Chip Griffin: Excellent. So, you’ve got the book, you’ve got Sales Schema. Why don’t you just give a little bit of background before we dive into the conversation about the book.

Dan Englander: Yeah, no problem. So, like you said, I’m CEO and founder of a company called Sales Schema. We’re a fractional new business team for marketing agencies and B2B service companies.

Been in business since 2014, which is a fancy way of saying we go out and help people win new business, get prospects, get appointments booked and all that good stuff. Before that I was the head of new business for a creative house and eventually helped them grow to seven figures. And before that kind of started on the account side, with a social media agency around 2010.

So that’s kind of my background in a nutshell.

Chip Griffin: Excellent. So let’s start talking about the book here, because you know, you’ve got some examples in there of how not to do outreach. And I have to say over the last, I dunno, six months or so it seems like there’s been a measurable uptick in my inbox at least of bad pitches from agencies. Things that are off the mark, clearly they’re just spewing them out to as many people as they possibly can. It’s become very popular for folks to hire outsource people, just to comb LinkedIn and, and send a generic message out that really has nothing to do necessarily with the target. And so your book is designed to be an antidote to that, isn’t it?

Dan Englander: Yeah, it really is. And I think that, like, what we found was that there was a time, you know, maybe arguably when you could go in colder and you could sort of represent the new cool thing that you’re doing in order to get doors open. But the problem is like with the way the markets move now, especially for any company that you could start with an internet connection from your computer, there’s so much understanding, there’s so much direct or indirect competition for what you do that really like the, the barrier that we’re trying to get over at the top of the funnel anyway is a trust barrier, right?

To take somebody that is even more busy than, than we all are, and we’re all very busy. That’s getting barraged from agencies that may not understand everything about what you do, but understands by and large the problems that you solve and getting them to take time with you. And what we found is that the things that get doors open aren’t so much the ins and outs of a product or a service. It’s not the things that matter deeper in the funnel. It’s really more kind of a human, you know, almost tribal connections that we have either on a personal or a business level that de-risk a conversation. Do we know people in common? Had you, have you worked in the same companies that we might’ve, that we might be working with? You know, those sorts of things, and honestly, just sort of like setting this impression that you’re not going to have your time wasted, that, you know, you’re looking for a mutual opportunity, as opposed to looking to pitch somebody is really kind of the vibe of these emails. So that’s what we do for clients when they work with us is we’re often, or almost always sending emails, sending outreach on behalf of the person that’s in that sales seat.

But it’s really more about finding the connections that they’ve already built and then using those connections, not necessarily just LinkedIn connections, but just kind of the rolodex in general to get into the right companies based on trust. So there’s a lot more I can get into there, but that’s, that’s kind of the, the point of the book anyway.

Chip Griffin: Well, I love that you have relationship in the title because I think this is something that is often overlooked by agencies who are scrambling to generate new business. And so they really are just thinking about how do I touch as many people as often as possible. And so you, you know, you get into a numbers game as opposed to thinking about the recipient of your communications as a human that you are trying to develop a relationship with so that when they are ready to buy, whether that’s today or a year from now, they feel, as you put it, trusting in you and comfortable with you and your agency.

Dan Englander: Yeah. And I’m glad you, you mentioned the numbers game thing because you know, there still is a numbers game. The numbers still matter.

It’s just, the numbers have gotten a lot smaller and I think that us, uh, kind of in the B2B world, and also given that, you know, most agencies that we work with are selling to like mid to large companies and they’re pretty specialized, the total addressable markets that we’re dealing with are not massive.

You know, we might be, in some cases we might be talking about four figures worth of organizations that you can do business with. So our whole philosophy has been, you know, what, why are you wasting your time trying and taking the lessons from consumer marketers that are telling you to, you know, overall automate everything or over automate everything.

Put people through a funnel that humans never touch. Now the scale matters and we’re not suggesting that anybody’s going to be writing a custom love letter to each prospect, but at some point, you know, when you’re dealing with a, with a relatively small market, the automation can really backfire and can really, you know, just not work as well.

A more common scenario, you know? So that’s, so for us and our clients, and a lot of like, what I’ve written about in the book is, is almost like front loading the work of prospect identification, and then determining the commonalities that you have. So instead of trying to put people through a funnel where you’re just sort of like automating all these touch points, it’s more about like, what if you were to spend more time figuring out the prospects, just a really simple example that are like in your, in your backyard, you know, that are in the hometown, in your hometown. Getting fancier than that, like what if you have this giant list of companies and there’s individuals that work for those companies, and then you say, well, what if I wonder what percentage of these companies, these individuals used to work with the clients that we work with? You know, like we do a lot of work with FedEx, maybe some of the people that used to work at FedEx have now gone to UPS and we use that as a way in. So there’s the list goes on and there’s, there’s hundreds of these, of these potential strong commonalities that you can, you can leverage.

But what they all allow you to do is de-risk that conversation in a way that’s much more powerful than trying to AB test case studies or subject lines or any of these other things.

Chip Griffin: So you, you mentioned numbers and in the book you talk about Dunbar’s number and the construct around that, and you suggest a modification to that.

So first, why don’t you explain Dunbar’s number for those who may not understand it, and then talk a little bit about how you’d like to modify some of that premise. Or add to it, really.

Dan Englander: Yeah, there’s just that, thank you again, Chip for actually… of course. Yeah. And thanks again for actually like reading the book and I get that.

I can tell you that you did, and hopefully it’s been useful. But yeah, basically Robin Dunbar is a sociologist and he suggested this idea of Dunbar’s number, which is actually like a series of circles of influence that we all have. You know, the smallest one and I forget how exactly breaks it down, but it’s something like five very close friends or family, you know, you have 15 close friends, I should say. You have 150 acquaintances. I think that’s what he actually refers to as like Dunbar’s number, which are the people that you might invite to like a giant party or something like that. And it kind of keeps on going out by, by triples, past that. Right. So our whole hypothesis, and it just kind of maps with our experience running lots of campaigns, is that on the higher end of that, you have thousands of people that you’re not acquaintances with, but who would take a conversation with you based on a personal and/or business commonality or a relationship that you might have in common? Right? Like the examples that I talked about before – used to work at the same company, went to the same college, from the same hometown, many, many other things like that.

So our whole thinking is in a world, you know, it’s like at the beginning of a Twilight Zone episode, right? The, in a world where your total addressable market is not massive, and the, the actual grunt work of whether you hire us to do it, or you do it yourself or hire somebody else to do it, the work of actually identifying these prospects with this commonality really becomes worth it in that, in that world.

Right. So that’s our whole thinking is start with your circles of influence, even the outer orbits of your circles of influence instead of going in cold, you know, and hoping that that CMO, that you have no connection with it ever is going to be wowed by your, your awesome case study that thousands of other people sent him or her that day.

Right?

Chip Griffin: Yeah. And I think finding the commonalities is so valuable, particularly for a lot of folks in the agency community who aren’t necessarily comfortable with doing proactive, direct outreach, right? I mean, it’s interesting because the agency community is full of people who want to be creative and communicating, helping them to clients communicate.

But when it comes time to actually do outreach themselves, they’re a little bit reluctant. And so, you know, finding these connections can also make it not, not only more likely that the person on the other end will say yes to a conversation, but also easier and more comfortable typically for the agency person to do that outreach.

Dan Englander: Yeah, I think so, too. And there are, there are, you know, it is a little bit unorthodox and there is, there is still work involved, but we just find that it works a lot better. Right? So a lot of what we do are just referral driven campaigns and our, our most successful clients are the ones that are really into this idea, which is that, you know, most of us, especially in the agency world, when we ask, like how, how do you get your business?

How have you gotten a historically? Most people tell us, oh, we’re, you know, inbound, kind of like over the transom referrals and our personal networks and RFPs and stuff. And we used to like wave our fists in the air and say, oh, that’s not sustainable. You know, you’re never going to grow your business like that. And we weren’t entirely wrong, just sitting around waiting for a random referral is not going to be that sustainable.

Especially if you’re kind of like, like you have a lot of experience with when you’re dealing with an acquisition, you know, they want to see that there’s something more sustainable, but the fact is your Rolodex and the trust that comes from referrals is, is one of the best sources of new business. That the trick is being deliberate and focused and building a system that’s at least relatively scalable to get those referrals.

So a lot of, you know, what we do, and a lot of what I’ve written about in the book is how to do that. So instead of just waiting for referrals to come to you, it’s like, well, what if you were to identify the people that you actually know, not with fake connections that we all have, you know, like maybe that’s your, you have a short list of 50 or a hundred people.

And then you were able to map everyone that they know who, who would have its titles in the accounts that you want to do business with. And now you’re going to your friends and you’re saying, Hey, Bob, you know, hope you’re doing well. I’m working on some BD stuff right now. Can we, can we hop on a call?

You’re getting on these calls and you’re saying, Hey, I saw, you know, these three or four people with these titles. Like, do you actually know these people? You know, if so, would you be willing to help me out? And if you’re, and what we found is like that, you know? Yeah. It takes a little bit more work, but if you’re specific about who you want to reach, and you’re just very open and honest about what you’re trying to accomplish, uh, people will help you.

And it works a lot better than just kind of sitting around. So it’s really about like, being deliberate about that sort of work that creates green shoots. Yeah.

Chip Griffin: So this book is an unabashed advocacy for direct outreach, right? You mentioned inbound and some of the other approaches that agencies can use, but you really are a fan of agencies doing direct outreach to try to find their ideal prospects and not focus so much on, you know, creating the atmosphere in which they’ll just come to you.

Dan Englander: Yeah, exactly. And I realize the glaring screaming hypocrisy right now, as I’m on a podcast to sell a book, you know, which are all inbound channels, which are all earned channels. So…

Chip Griffin: But it doesn’t have to be exclusive. Right. I mean, it just means that it needs to be an important, if not primary approach.

Dan Englander: Exactly our whole argument is, you know, not to disregard inbound or not to do inbound, but you know, in a situation where again, you have a limited total addressable market, why not build the relationship with the people you can do business with sooner rather than later, even if the sales cycle might take longer than planned.

I think one thing that’s kind of gotten thrown around that I disagree with is the idea that sales calls have to be last mile. The the only way you’re going to get somebody on the phone is if they’re ready to buy right now and they’ve read a million articles and they’re like ready to sign up. Like, yeah, that’s great when that happens, but there’s no reason you can’t build a relationship sooner so that you can avoid all the commoditization that comes along with them doing all the research that frankly they don’t really want to do, you know? So that, that’s one thing. That’s one thing to mention. I lost your question a little bit, but yes, the other – back to outreach, the argument for outreach is another one is that, you know, a lot of the times when we’re talking about inbound, it’s being mediated by other people’s platforms. By platforms that you don’t really own, whether that’s a LinkedIn, and you’re running ads, or even just communicating with people on LinkedIn, whether it’s Facebook and you’re running ads whether it’s a Google you’re running search ads, you know, search, like SEO, these are all great.

And I’m not saying not to do them. They can have huge payoffs, but I think that the risk reward ratio has gotten a little bit out of whack since their inception. You know, like we all know companies that have been wiped out from algorithm changes. In the ad business, it happened recently maybe for good reason with the iOS 14 stuff.

Like every, it’s not like it’s an every five-year thing. It’s almost like an every 12 month thing now that a certain slew of businesses gets wiped off the map due to platform risks. So our thinking is that, you know, if you’re in this for the long haul, if your total addressable market is small, why not figure out how to do outreach, which is a channel that you actually own so that you can build relationships today and like go out hunting with a spear and never go hungry again.

You know? So that’s, that’s kind of our thinking on it anyway.

Chip Griffin: Now are there, are there certain parameters that, that work best for the kinds of businesses that can use your approach? In other words, is there, is there a sort of a magic revenue number? Is there, you know, what about the number of clients that an agency is trying to acquire?

How should they be thinking about those things before they jump into this approach?

Dan Englander: Yeah, it’s a good question. And we have kind of like very vague parameters, you know, there, there aren’t a lot. I’d say that we tend to work with agencies about like at least 1 million in revenue and up, and usually like between like 10 and 200 something employees is kind of our, our personal sweet spot.

But I think that, you know, even if people never hire us, this tends to work better for big wins, right? If you’re going after, and this is a very rough range, but let’s say like 50,000 client lifetime value and up. That’s part of it. Part of it is the work that goes into the approach of personalizing. But I think even without all the personalization, the sales cycles are long and costly.

And there needs to be a big enough pot of gold at the end of the rainbow. So this isn’t, this isn’t the right approach if you’re selling to gyms or you’re selling to med spas or chiropractors or something like that, there’s a whole ecosystem of people that are really good at that. And good at like building funnels for kind of like small and medium sized business agencies.

This is more for that B2B. B2B2B, you know, all the way down kind of thing. Not all the way down, I guess you could sell to like, you know, a big company that sells to consumers, but that’s, that’s the idea. And our whole thinking there is like, you know, at that point when there isn’t, you know, like I said earlier, when there’s not hundreds of thousands of companies, but when there’s like, you know, four or five figures worth of total addressable market, but the personalization starts to pay off a lot more, you know? So that’s, that’s where this is coming from, basically.

Chip Griffin: So, so let’s talk about that personalization, because you said it’s, it’s not a, an individual love letter, I think was your, your verbiage for each individual prospect, but there has to be some level of personalization there.

So, so talk a little bit about the logistics of that, you know, how do you do that and do it in a scalable way?

Dan Englander: Yeah, it’s a really good question. I think the, the first thing is, is a lot of times, like we all, as business owners, we all have like a tendency to jump onto tactics, which obviously the book covers a lot.

I’ve talked a lot about tactics so far. They’re always fun. But the bigger question is, is who’s doing what and how much time is it going to take? And is it the best option for the time and resources that you have? Right. So in a perfect world, you have, you know, a sales team or you hire a company like ours to do it, and then you have somebody else doing this.

And that, that, that I think has changed a little in, in a way that is worth talking about. And that’s the classic way we’ve been sold as a sales team is you have, you know, an account executive who’s the closer. Behind them you have a BDR and that BDR is prospecting. And then, whatever. And then you have an account management.

What’s the account manager once the deal is closed. I think what has been taken for granted is just the amount of, of thinking of creative, of hustle, of systems, thinking that has to go into the BDR’s job, just to get a skeptical decision maker, to agree to have that appointment. So the answer is, you know, what, how do you do this?

How do you scale it? The question is, how do you scale it logistically? It kind of just depends on the size of your agency and the resources that you have. Right? So if, if you are, you know, a solo preneur, it really means that you’ve got to kind of like schizophrenically divide up your, you know, do the multiple hats thing and divide up your job into multiple jobs.

And I think the first one is the, the systems, the creative, the hustle of building out these, these systems enriching the data, you know, delegating things to list builders. And that’s a very different thing than what goes into closing a deal and building a relationship and presenting things and talking through objections, right?

So you’ve got to kind of divide up your time in those different ways. If you do have the resources, then this might mean you’re spending that system’s time going on Upwork and finding a list builder that can go find these pieces of information and put it into a spreadsheet. But you’re kind of dividing up things in that way.

And almost like it’s the, the sales assembly line. To get even further into the weeds than I have, I think another thing that has been taken for granted is the seniority of the person that’s reaching out. Right? So a lot of the times we’ve been sold this Silicon valley sales pod model, right?

Where you have a BDR, that’s saying, Hey, do you want to talk to our account executive? And I’ve seen that to varying degrees in the agency space. But the problem with that is as an agency, you’re not selling software necessarily, you’re not selling any invention, you’re selling expertise, you’re selling somebody’s time.

So you know that CMO is not going to be that interested in talking to your junior level sales employee. So the face of the outreach, even if that person isn’t the one handling the sales process really does matter. Right? So if you have a partner that’s willing to get on these calls as they, as they probably should be at least for a few minutes, then that’s going to go a lot further than, than having a sales person do it.

So what we’ve done with a lot of our clients is we have the face of the campaign, who’s like the partner that the outreach is coming from, you know, the, the CMO or whoever’s clicking through to see who this person is. They’re like, oh, this is somebody that knows their stuff. They’ve been around a while.

They just get on to kind of make the intro and then there’s somebody else that takes the baton and handles the rest of the process from there. So that, that that’s hopefully helpful is like first, just starting out with who’s doing what divide up your time between the systems processing versus like actually doing the outreach and the closing of deals and then kind of go from there and then it gets into the tactics and everything.

Chip Griffin: And I liked that, that you point out in the book and also just here now that, that it’s not one size fits all, right. It’s not a single formula that works for everybody as far as who does what, because it’s going to depend on the size of the agency, the nature of your prospects. You know, are you, it’s going to be different if you are a digital marketing agency, that’s doing high volumes of clients versus. You know, maybe more a traditional PR agency that’s, you know, only looking to add, you know, five or six clients a year, but you know, higher ticket value. So, you know, understanding how those all work into the mix is important.

And so you need to tailor something that works for you and your team, not necessarily what you heard from someone at a conference or what your, you know, your neighbor does.

Dan Englander: Yeah, exactly. And I think that, it’s – there, there there’s sort of certain exceptions to this, but everything kind of lends itself to being able to charge higher prices, because then you can actually afford to do the sales process.

Right. Because the fact is like the sales process doesn’t necessarily go up exponentially in terms of how much it costs to close a fortune 500 versus a startup. Yes, the fortune 500 takes longer. Yes, there’s, there’s more considerations there, but it’s not a million X more considerations. It’s just moderately more.

So there is, you know, that doesn’t mean you have to necessarily go out market, but it does sort of encourage getting away from like low end marketing services where you need to do this volume play to make the numbers work. Yeah. Right.

Chip Griffin: And speaking of numbers, you know, I think one of the really helpful things in the book is that you encourage folks to go back and look at their last year of communications with prospects and it will help them as they look and say, okay, you know, what stage did they get to?

You know, did I have an initial conversation with them? Did I have a proposal conversation? Did I send them a document? I sent them a contract and, and really you know, instead of taking whatever your CRM has for recommended, likelihood to close at different stages, instead of, you know, just sort of, you know, back of the envelope guessing you can use real data to inform your whole process and understand these things because at the end of the day, it is a numbers game. And so if you figure out, okay, this is how many new clients I need to hit my revenue targets, you know, you can then back that out based on your historical performance, whether you’re tracking that in a proper CRM or on a spreadsheet, or you have to go through your email inbox.

Dan Englander: Yeah, exactly. And I think that that’s kind of like the first hurdle to get over if you’ve gotten most of your business from just sort of organic referrals and that really just means you don’t have data yet. And it’s better just to accept that. But I think what happens is people run into that question mark, and they go in one of two ways.

They either say, eh, you know, we’re not even going to measure anything and we’re just going to wait until somebody is qualified and whatever that means. And then just kind of keep doing the same thing or they do the opposite and they try to measure every little thing in order to make some like overly complicated definition of what qualified or whatever any other word means.

And I think there’s a good middle ground where you can kind of keep things simple and base your rating of values of the CRM, based on just like actions people have actually taken and to kind of determine, use that to determine like where you should invest your energy.

Right. So the most simple one is, you know, have they agreed to speak with you? Have they taken a meeting with you? Have they agreed to a second proposal call or whatever that is in your process, and then have they bought from you? You know, start with essentially three stages based on actions that they’ve actually taken.

And the problem is we all fool ourselves, you know, we use qualified. And if you wake up on the right side of the bed, somebody is qualified. If you wake up on the wrong side of the bed, or you got into an argument with your spouse than somebody who’s unqualified, right. So it becomes too wishy-washy.

Chip Griffin: Yeah. And, look, I think one of the big challenges that agency leaders have is that they, they fall in love with their prospects. And so, you know, one of the things that I think they have to get better at in business development is figuring out when they’ve come across someone who’s not really a fit, right?

Maybe they, you know, they, they made it onto that list of people who will take the conversation and all that kind of stuff. They take the call, but at the end of the day, you realize this really isn’t a fit for what we do. And part of being a numbers game is making sure that you’re spending your time on those most likely to close and most likely to have a successful relationship. So that’s, I think a piece of it is, you know, working to identify those things that are red flags, warning lights, et cetera.

Dan Englander: Yeah. There’s a great sales coach I like named Temple Naylor, and I referenced his stuff in the book. He likens it to an episode of Scooby-Doo where you’re going down a hallway, just like looking for ghosts, looking for monsters and stuff. That’s kind of the idea is like you, you know, the problem is too many of us get happy ears and we just want everything to work out. So you hear something that could blow up a deal and you just sort of, ah, just leave it, leave it over there.

You’ll let sleeping dogs lie. And then guess what happens is, you know, you go through the RFP or whatever, and you’re two weeks in, three weeks in. It’s crickets. Nobody’s following up, nobody’s getting back to you. You finally get somebody on the phone and they’re like, yeah, it turns out, you know, our partner, uh, he had this other vendor over here.

They went to college together and uh, we’re, we’re gonna go, we’re going to go with them. I can’t tell you how many times we’ve heard a version of that story. And maybe you could have, maybe you kind of got that vibe, but you didn’t explore it, or you could have found that out. Right? If you, if you, if you’ve been a little more, a little more focused and a little, little more skeptical. Right? So…

Chip Griffin: And I would argue, that’s not even the worst case. I mean, you know, if you don’t win the business, that’s better than winning the business and then after the fact realizing that that wasn’t a good fit, because now you’ve probably got an unhappy client.

Probably an unhappy team because they’re being asked to produce results that they can’t, or at least can’t do profitably. And by the way, that’s bad for your bank account too. So you’ve got to do that and not just fall in love with the fact that you may have a new contract on the line.

Dan Englander: Yeah, exactly. And that’s the purpose. That’s another argument for being able to have enough, you know, in the pipeline that you’re not tempted to go against your go, go for your demons, basically. Yeah.

Chip Griffin: Exactly. Yeah.

Cause if you’re, if you’re following the process that you outline you’re able to be having enough conversations that even if something falls through, or even if an existing client leaves, you know, hopefully you’ve got something to lean on there and you’re not starting from a standing start and saying, oh my God, what do I do now?

Dan Englander: Right. Right, exactly. And that’s what we’ve seen with, with our best clients is that, you know, it’s a team effort. It’s not just us, but because you know, we’re able to lean to this level of personalization. They then get to use the prospects that we’re getting them for advancing their process. But for also just like fine tuning their process overall, like one of our best clients is at 1.1 million in about 12 or 14 months with us, from, you know, using referral based campaigns to give them the door with lots of these brands. And they’ve done a lot of work. It’s not just us. We’re just getting the door open, but they’ve been able to just fine tune their process over and over again. And essentially qualify people out more, more quickly, and then just spend a lot more time on the people that actually matter.

So that’s, that’s a, another way to think about this.

Chip Griffin: Well, Dan, it’s an interesting book. It’s a great conversation. If someone wants to get a copy of the book for themselves or learn more about Sales Schema or connect with you, where should they go?

Dan Englander: Yeah. Thanks so much, Chip, really appreciate it. The best place is just Salesschema.com/RSAS that’s RSAS and that’s the landing page for the book.

You can go there to get it from Amazon. There’s also all the resources from the book there. There’s me reading the first chapter if you want a preview of it. Or you can snag it there. And, not sure when we go live, but it’ll be out on Kindle June 14th.

Chip Griffin: Excellent. Well, I encourage folks to check it out.

There are lots of good practical ideas in there that will help you to do more, to build your own agency into one that you enjoy owning because that’s my whole philosophy. You gotta like what you do. Otherwise, what’s the point? All right. Well that will bring us to the end of another episode of Chats with Chip.

Again, my guest has been Dan Englander, the author of Relationship Sales at Scale and the founder and CEO of Sales Schema. Thank you all for listening. And I look forward to having you back on the show again, soon.

Dan Englander: Thank you, Chip.