From suspects to prospects: How this agency builds its sales pipeline

When you have a conversation with Scott Sanderson about his career as a digital agency owner and entrepreneur, two words come to mind that sum him up best: remarkably adaptive.

The Founder of OctoHub—which coincidentally bears the motto “adaptive digital marketing”—started his career nearly two decades ago, a period when Google was still in its infancy, social media and iPhones weren’t even a thing, and agencies found it impossible to serve small businesses due to the cost of delivery.

How quickly that all changed.

And yet, Sanderson has survived and thrived in an industry where disruption is the only constant by being remarkably adaptive. He knows how to move his business model and sales process with the times.

On that note, Sanderson was kind enough to sit down with Vendasta’s editorial team to share insights on his five-step process for finding leads and moving them through the sales funnel. He also offers his two best pieces of advice for agency owners in light of today’s uncertain economic climate.

What it was like selling marketing services back then

To appreciate how Sanderson runs his business today, it’s important to take a step back in time to the 2000s when Minesweeper, iPods, and AOL Messenger were about as digital as things got for most people.

Back then, selling digital marketing services to small and medium-sized businesses (SMBs) was extremely difficult because technology and competitive forces had not evolved sufficiently to be able to deliver solutions at affordable prices.

“When I started my agency, we had two locations in Western Canada: Vancouver and Calgary. One of the things we really struggled with was the number of small businesses that needed help but they literally couldn’t afford our services no matter how much we wanted to help them,” he recalls.

“They didn’t want to spend $15,000 building a website. We had to focus on large and enterprise customers who could afford the bill,” he explains.

But thanks to the democratization of technology and the rise of software-as-a-service (SaaS) companies, digital marketing has become a level playing field for both large and small businesses today.

“You can now get software to run a big part of your digital marketing with no extra labor required. I can provide or resell software and services that allow local businesses to manage their Google Ads campaigns, listings, and SEO. They can start small at under $200 and build from there,” he says.

However, that democratization of technology and ease of access to digital marketing services has also created its own set of challenges.

“Trying to boil the proverbial ocean”

Today, the biggest problem for agencies is in educating SMBs about the necessity of having a strong online presence, explaining fundamental digital marketing concepts, and, of course, being able to sell to them effectively with a healthy profit margin.

“Now we’re busy trying to boil the proverbial ocean of small and very small businesses. We’re busy trying to educate them and help them understand that if they get their listings, backlinks, and search engine optimization right, then Google will treat them more favorably,” he says.

“That’s our big hurdle: Trying to figure out how to reach this unreachable herd of cats that we call SMBs and trying to herd them together, educate them, and gain their trust.”

Building a sales pipeline

From talking to shop owners and joining Facebook groups to cold calling and referrals, there are many different ways to find potential customers. Sanderson, however, prefers a targeted and technology-led approach.

Step 1: Use Google Business Profile

The first step is to harness the power of Google Business Profile (GBP) to find opportunities in local areas.

“We don’t do cold calls. Today, you can sit in your pajamas in front of your computer, be on GBP, and find prospects all day long because there are restaurants everywhere in local communities,” he says.

“Let’s say you find 50. Go check them out. What are they doing right or wrong in terms of their online presence? You can see it all there—the roadmap is in front of you. It’s just about having a process to identify the opportunity and then articulate it.”

Step 2: Tag them as a “suspect”

Once a sales rep has identified a potential opportunity, their details and contact information are added into a customer relationship management (CRM) system and they’re tagged as a “suspect.”

“We call them a suspect, and that means we've somehow got them into our database, mapped to a sales rep’s territory, all in the platform,” he says.

“So we think it's a real business, we found a contact email, we found a phone number, and so we’ve created this record of a suspect. And now we want to go to that business and target them with messaging around their online presence.”

Sanderson encourages his sales team to employ the loss-aversion principle to make business owners realize that their direct competitors are potentially attracting more traffic due to a stronger online presence.

“We like to tell business owners that if you're not managing your digital presence, you’re being penalized by the ecosystem. Meaning somebody else is getting traffic that could be going to you,” he says.

A key tool for OctoHub during this step is to leverage Vendasta’s Snapshot Report in outreach emails to highlight deficiencies in a suspect’s online marketing performance.

“We promote the report—we give them the data that highlights where they need help and we offer the roadmap to plug those gaps,” he says.

Step 3: Move them to a prospect (and then an engaged prospect)

If the business owner clicks on the Snapshot Report, OctoHub’s sales reps are alerted to a genuine business opportunity and get in touch with the lead.

“So if they open something, we know they're real, we move them to what we call a prospect from a suspect. And then if they engage and ask for the report, they become an engaged prospect,” Sanderson says.

Step 4: To convert, you have to keep it simple, affordable, and tangible

At this juncture (following the movement from suspect to prospect and engaged prospect), OctoHub’s sales team moves to close the deal. Through his experience, Sanderson has learned to be careful during this phase and employs the following framework:

• Don’t overwhelm the engaged prospect with information. Remember that they often barely understand digital marketing
• Start small: Provide a solution or package that is affordable for the SMB and doesn’t tie them into commitments or contracts
• Help them drive immediate results

To that end, OctoHub initially sells digital marketing packages centered around Google Ads campaigns designed to drive traffic to an SMB’s webpage. Once a client sees tangible results, the sales team would work with a client on other elements of their digital marketing strategy including listings, social media, reputation, and SEO.

Step 5: Always keep them engaged

After sealing the deal and proving rapid success, the worst thing an agency can do is leave the client to their own devices. That’s why OctoHub has created automated campaigns that drip-feed useful content such as:

• The why and how of keeping up-to-date listings information
• How reviews and reputation improve Google rankings
• Ways to improve Google Ads performance
• Invitations to webinars where customers can learn how to improve their online presence

“We try to give them bite-sized actionable insights to keep them engaged, re-engage them, and earn their trust along the way,” he says.

“And if you look at our approach overall, that’s how we find opportunities, onboard them, and scale. With that process, we’re sitting at over 2,100 customers today.”

2 big learnings as an agency owner

Running an agency is tough at the best of times. Not only does an agency owner need to ensure that their sales pipeline is humming, but they need to keep a mindful eye on client retention and costs. On these latter points, Sanderson offers salient advice.

Don’t put your all your eggs in big relationships

As Sanderson pointed out at the beginning of this blog, there was a time when only big businesses could afford to spend money on digital marketing.

The benefit of that was that an agency would have large amounts of revenue and fewer clients to deal with. But as Sanderson has learned vividly, the risk is that these clients abruptly terminate service agreements at a moment’s notice.

“It happens all the time. And there's so much relying on that relationship that you're really not in control of. They decide they want to use another agency just because they want to change,” he says.

Agency owners should hedge against this risk by building a broad set of clients rather than focusing only on large brands or adopting the “80/20” playbook.

“If you build out a really solid, broad base, and not only look after these big guys, I think you’ll have a much more sustainable business and a higher survivability rate.

“It's no longer a world of five or six accounts, it's 50 or 60 account.—500 or 600 accounts is even better. If you build a pyramid, it’s unlikely to fall over, as we’ve noticed in Egypt,” he says.

Always manage your costs

In spite of soaring inflation and the threat of a recession looming, Sanderson encourages agencies to manage their expenses despite what’s happening in the economy. He is a strong fan of remote work in order to achieve lower running costs.

“Lease, rent, upkeep, somebody at the front who's a professional greeter: We don't do any of that. This is a virtual business. And so it's really about being able to see into what's happening from a central hub,” he says.

“And the Vendasta platform provides that. We have dashboards showing you who's moving people through their opportunity funnel, who's adding accounts, what's happening with the engagement levels on these emails. And so I think even when you look at it from a CRM perspective, it's doing all the heavy lifting and you can look into it from afar.

“Software, automation, hoteling, working remotely, all of those things have come into a world where you can manage the expense side of this business. And then it's just about how much better can you get at making that funnel work better?”

Want to become like Scott Sanderson?

Scott Sanderson is one of Vendasta’s most successful partners. He’s been running digital businesses for over 20 years and serves over 2,100 customers by leveraging his own offering with pre-vetted solutions every local business needs through the Vendasta platform. For more details, check out the OctoHub case study.