[Music]

I’ll never forget the day that I

realized that the marketing agency

business model is broken

well maybe not broken but definitely can

use some tweaking so there I was with my

team we’re on the eighth floor of an

all-glass building pitching a very

prominent financial company marketing

services so we laid everything out we

spent about a week preparing for this

thing with digital assets and showing

them all the things that we’ve done for

prior clients like them and how we could

just blow it out of the water for them

so they looked at everything and said

well this this is pretty impressive what

you guys have done and we have no doubt

you probably could do this for us but

advertising has never amounted to more

than 10 percent of our clients so what

other kinds of strategies do you have to

create more clients than just Google ads

and Facebook ads and things like that

and secretly when they said that you

know I just kind of looked like this

mm-hmm-hmm

but honestly inside it was like jaw drop

top of my head blow off because I

realized my company was totally focused

on selling media and billable hours for

design that was it

and it does fit for some companies so my

point here is not to bash marketing

agencies because they do great work but

if that’s the kind of work that you need

I found a lot of companies like this one

the kinds of work they need are things

that really like chief marketing

officers or CMOS focus on like when a

CMO is hired by a large company they

don’t say let’s spend a ton of money on

Google and Facebook they first look at

well how are we getting clients right

now and usually it’s a handful of

relationships that amount for the

majority of the clients anyway so many

CEOs go who are those relationships and

what are similar relationships that

aren’t producing those kinds of clients

and how can we activate those relation

chips and I started to think about that

kind of business development approach or

even many clients or I saw I’m sorry

many companies are spending thousands of

dollars on media but they’ve never

really invested in a referral strategy

in other words it’s so much easier to

create a repeat customer versus trying

to tell somebody new that you’re great

and they should use your product or

service and yet

so many companies spend all this money

on marketing before they even focus on

having a real robust referral strategy

and so I started to think about these

things and think like what are we doing

as a marketing agency if we’re just

focusing on this 10 or 20 percent

potential lift for companies yet we’re

leaving on the table the 80% of how

companies get their business and that

was my lightbulb moment and that’s when

I realized I need to take a look at how

we do things and restructure how we help

companies get more clients and get more

brand awareness many of our clients

refer to us as more of a outsource

CMO so what are the differences between

an outsourced CMO approach and a digital

marketing approach so the CMO what they

do when they are hired initially is they

of course like I said before look at how

a company is bringing in clients and

ultimately what a CMO does is they look

at ways to increase the lifetime value

of a client and also decrease their cost

of acquisition all of these strategies

should center around those two things in

other words if I can increase how much

my average client is worth well that

makes me more money and if I could

decrease the cost of how much money I’m

spending on marketing and advertising to

get that client well then that also

makes me a lot of money and there are so

many different ways to go about doing

that now on the other side marketing

agencies they’re hired usually for a

very narrow focus they’re often not

involved in the top level strategies

that companies have for growth they’re

usually called as more of a vent

to help them either get more brand

awareness or get more clients and that’s

usually through paid media whether it’s

digital traditional or both and also

billable hours with design and agencies

are great at doing that so let’s talk

about some of the pros and cons of

working with a marketing agency what’s

great about marketing agencies is it

means that you don’t have to hire more

employees of course you could hire one

person to try and do SEO Google AdWords

design do coding for websites but I’ve

never met one person that does all those

things even well usually people have

specialties on what they are good in so

companies can either hire four or five

or six people to do what a marketing

agency does or they could hire one

person and then work with an agency and

work with that person

in other words marketing agencies can

provide excess capacity so instead of

hiring three or four people to sit

behind a desk and pay them benefits and

things like that you get experts to help

you with content writing media

management media buying and design and

so that’s one of the best parts about

marketing agencies and why the business

model it does still work for a lot of

companies and why there’s plenty of very

successful agencies in America right now

a couple cons to think about when

considering working with a marketing

agency is that they usually just focus

on media channels when it comes to

client acquisition which can get very

very expensive and oftentimes compromise

your return on investment and the other

is the fact that they often rely heavily

on media and so in some cases the

average marketing agencies staff is

anywhere from 10 to 15 people so the

larger the staff

unfortunately that sometimes dictates

the kinds of things they do in other

words media is very very scalable and so

it’s very easy for a marketing agency to

sell media even if it’s not completely

in your best interest

so what are some pros and cons of

working with an outsourced CMO or a CMO

advisory well the first is that they

focus on growth over everything else it

doesn’t matter what channel it comes

from sure Google and Facebook sounds

sexy but what if you got 70% of your

clients in the next three months from a

very targeted referral strategy that’s

not even digital well who really cares

if it’s digital or not all you care

about is you want more clients or you

want more brand awareness or you just

want to hit your goals and that’s what

an outsourced CMO does is they’ll look

at all xxii acquisition channels every

one so of course there’s digital ones

that we’ve talked about Google Facebook

SEO even traditional advertising

channels but outside of that there’s

things like business development

strategies referral strategies PR public

relations strategies there’s so many

things to consider and so what many CMOS

do including us is we’ll sit down with

our clients and come up with a viable

idea for every outreach channel and then

rate them and then categorize them on

how we can create clients for the least

amount of money with the most impact

probably the biggest con of hiring an

outsourced CMO or a CMO advisory group

is if your company already has a

director of marketing or a senior vice

president of marketing that person may

provide some resistance in working with

a group like an outsourced CMO but there

really shouldn’t be in resistance at all

because both groups are working towards

the same common goal one of the biggest

differences between a marketing agency

and a outsourced CMO advisory group is

who does the work and for the marketing

agency this was part of the broken

business model to me that I had to

really figure out but typically of a

marketing agency let’s say a staff of 20

there’s usually a

people let’s say two or three that

provide all of the direction and provide

all of the decisions and then they have

their employees that carry out their

decisions well that those two people of

that marketing agency if you ask them

they would love to employ experts in

every single part of the marketing

strategy so SEO they’d love to have

somebody on their staff that’s been

doing SEO for 12 years Google Ads they’d

love to have somebody that’s been doing

Google ads for the last ten ten plus

years Facebook ads all these things

email marketing they’d love to have

seasoned veterans doing all these things

but the problem with the marketing

agency business model is if they had

these level of experts at every single

position they would not make a profit

and so what marketing agencies do is

they’ll hire people out of college and

those people will be with them for

probably two or three years and then

they go to some other agency so what

many clients find is they’ll be wined

and dined by the agencies directors

founders co-founders and given a great

pitch and they sign off on it and then

they’re given to an account coordinator

who’s been out of school for a year and

a half who on their own merit couldn’t

have landed that kind of job and

oftentimes communication errors and

things like that

happen and that’s a very common thing

that happens with marketing agencies so

how is an outsourced CMO different from

that well

the outsourced CMO has still employees

doing core parts of marketing such as

media management content writing web

design but what that outsourced CMO can

do is also use freelancers now many

people will say that hear this and go

well of course I mean every agency uses

some freelancers here and there yes but

most agencies prefer to do things

in-house just because it sounds good

but yet what outsource CMOS do including

us

as we have freelancers that have 10 plus

years experience and many of these

things we’re working with and we’ve been

working with them for years so what our

clients get is us as a quarterback with

the strategy implementing and when we

don’t have somebody internal it’s

somebody external that we’ve been

working with for years and that way you

get the 10 plus year level experience on

every facet of your campaign and

oftentimes it’s either coming at the

same price as working with a marketing

agency if not less another big

difference between marketing agencies

and outsource CMOS is that marketing

agencies tend to pay their employees on

the low side and that’s because like we

talked about before they’re getting

their employees from college of the last

couple years and usually there’s high

turnover until they’re on to their next

gig outsourced CMO advisory groups

across the United States can’t afford to

pay their employees much more because of

course they’ve purposely chosen to have

a smaller group doing core competency

and because of that we have much happier

employees and they do much better work

so the big question is who should you

hire well first of all you’ve probably

never heard of an outsourced CMO or even

know that exists and that being said

marketing agencies are great if you

already have a marketing strategy in

place and you have various components

firing away and part of the things you

need are advertising you need design you

need some SEO very specific things then

a marketing agency would be a great

choice to carry those things out but if

your company doesn’t really have a

specific marketing strategy and you’re

not really focused on your past clients

and current clients and trying to get

them to buy more from you and you’re not

really looking at the kinds of

relationships that are bringing current

business in and ways of getting more of

those really

chips it might make sense to first start

with an outsourced CMO who not only can

look at those things and come up with

strategies that involve Google Adwords

and Facebook ads and SEO and all those

things but if you lack that strategy if

you lack that kind of process the CMO

might be a better bet for you but either

way you go you’re in the right place

because you’re on our website and so

since you’re on our website go ahead and

look up if you look at the toolbar

you’ll see a tab that says insights and

there’s a ton of blog post if you click

on that where we have a lot of different

articles that are designed to really

help your business grow

[Music]

When to Choose a Digital Marketing Agency or an Outsourced CMO

Your business needs more customers, so what do you do? The easiest thing is to spend money on advertising, which works great if you’re looking for a 20-30% increase in customers. But what if your company has more aggressive growth goals? How do you achieve them? Even though Nettra has spent over $19m on the Google & Facebook advertising platforms, we’re the first to admit that advertising on its own will not produce a substantial lift. This is why we wear two hats: we’re a marketing agency to the businesses that hire us to carry out specific tactics like web design, SEO, or Google ads. But we also wear the hat of a CMO (chief marketing officer) which allows us to roll up our sleeves with our clients to tackle their biggest obstacles to growth. We often focus on non-advertising strategies like business development, referral processes, and sales enablement. Our CMO service is very unique so we decided to create this video that outlines the differences between it and our marketing agency business model.

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