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The Bulletin – Issue 1

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April 15, 2018

Welcome to my first issue! Every week I come across articles I find to be pretty damned useful, interesting or inspiring.

I’m starting an every few weeks(ish) email, The Bulletin, so that I can share what I find in hopes that some of it inspires you or just simply provides for a good read! If you hate it, go ahead and opt-out anytime.

I hope you enjoy it.


 

The Cost of Quality

A great article from Intercom’s Geoffrey Keating on the pricing economics of perfection and the point of diminishing returns for product quality. This one hits home with me as I launch BOLD and a new marketing m that it will for many entrepreneurs. At what point do we accept something is simply good enough and stop striving for perfection?

Building Bee Health with Fairmont Hotels

When I think of innovative brands and those that truly think outside of their industry, very few hotels come to mind. However, Fairmont Hotels has over 40 apiaries across their hotels around the world! The Fairmont Waterfront in Vancouver even has a Bee Butler and staff to tend to the bees and provide tours.

How Warby Parker Truly Invests in its Employees

I’ve admired Warby Parker since they started more than 8 years ago. I remember their yellow school bus in Seattle that was essentially a mobile shop as they bootstrapped their way across the US – it was awesome! If you want to find out how to not scale out of caring for your employees, take a lesson from Warby Parker.

As I grow BOLD and take on new challenges, I’ll keep coming back to this  for inspiration. A great brand with a great vision for change.

200+ Million Eggs Recalled for Salmonella

I mean, C’mon. This came out just today, and when I first started reading it I was really interested in how 200 million eggs can be tainted, like where did they all come from?

Apparently, it’s a single farm that produces 2.3 million eggs from 3 million hens per day! That disgusts me – it’s simply impossible to have that many hens living in healthy environment producing that many eggs.

I can’t wait for the spring farmer’s market to start up again so I can get my local eggs again!

Facebook, Privacy, and a Senate Hearing Flop

Everyone’s talking about Facebook and Mark Zuckerberg’s Senate hearing. What’s it really mean? I’ve been interested in this because of my love-hate relationship with Facebook. I have an account because I’m in marketing, and well, you can’t simply avoid being where consumers are. But I also like catching up with friends.

I’m torn because the data you get with FB from a marketing and advertising perspective is awesome, yet at the same time, I wish the control were greater. Ben Thompson has a great writeup on the entire topic.

Tobacco Free Florida

I love advertising. I love the history of it, I love the creative behind it, and I love the science that powers it. I can spend an entire Sunday watching Adverts – dissecting them, analyzing the agency behind them, and when one really moves me, I dig into everything about it. It’s an addiction.

Tobacco Free Florida, working with Alma, one of the best agencies out there, have produced a really great campaign around empathy for smokers vs the typical health fears that I think is an incredible message with their Quit Your Way creative.

I love the idea of amplifying smokers the way they do and building empathy around their desire to quit. A very cool state program.

Performance Based Marketing

So BOLD has actually been running for quite some time, I’ve just not been too involved in it. This week, I took more of an active role in BOLD and am excited to see if a true Pay-for-Performance marketing partner for startups, entrepreneurs and growing businesses can work.

I sent an invite to my LinkedIn network, which includes previous clients, colleagues, and a mix of people I’ve been fortunate enough to meet through the years working in marketing, really unsure how people would respond.

It turns out, we may be on the right path. There are nearly 30 people that responded interested in making deposits for working with BOLD, which is exactly 30 more than I thought would be interested!

While BOLD won’t disclose any clients it works with, I am going to publish everything BOLD does to grow this agency, including all the tools, forms, resources, structure and strategy.

My hope is that the project can help improve the agency / client relationship and make a tiny impact in my industry.

Upcoming

  • BOLD – Time to grow this ( freelancers wanted )
  • Conversation & Craft – Launching in May. Similar to the Beans and Brainstorms I ran in Seattle, this is a monthly get together in a craft beer or coffee joint in the greater Chicagoland area with a single speaker covering marketing and business.Events will be free to attend and hosted Friday mornings before the work hour.

Performance Based Marketing Model

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For decades, consulting firms have been providing strategic guidance for their clients for decades, largely working within framework that the industry began in – charging clients an hourly or daily rate to have access to the firm’s expertise.

This model leads consulting firms to 1) hire lots of people, the best if possible, and 2) sell, sell, sell. The more people working on a project, the more available billable hours the firm can invoice, which focuses the client on buying more expertise more often than necessary.

The majority of consulting and professional services firms work in this model and clients just accept it. Over the past five to ten years, technology has enabled more beneficial relationships and opportunities between clients and individual consultants and freelancers. At the same time, many creative agencies have adopted a more performance based approach for their services, moving in a more transformative direction and improving results both for their clients and their own bottom-lines.

New Variable Consulting Model

Traditional consulting structures are based on clients using their consultants as much as possible and being charged for that time. With this model, the firm and the client begin their engagement at odds with each other and with opposite motive:

  • The client wants to be billed less and is motivated to reduce resources as much as possible
  • The firm wants to provide more consultants, thus increasing the billing time as much as possible

From the client’s perspective, you really end up with very little control or choice when working with a consultancy. If you are presented with a $150k proposal and you want to reduce it down to $125k, you are typically going to be met with some hostility and reasons why your new partner just simply can not deliver the expected results when $25k is cut out of the plan.

At Bold, we take a more strategic approach when working with our clients and pursue opportunities that are more aligned as an investor rather than service provider. Our goal is to fundamentally change how consultants, consulting firms, and clients collaborate together and provide an environment where success leads to bigger rewards for both our clients and our firm through various models of engagement.

Performance-Based Consulting

We believe all consulting and agency agreements should be performance-based rather than cost-based. While there is room for some cost structure between freelancers or independent contractors and their clients, the work that’s being completed in a cost-based structure is typically more administratively focused rather than revenue growth or savings focused, so those arrangements can make sense.

For example, a client may just need some data cleansed or a website cleaned up and rebuilt. These are maintenance tasks that the client does not have the resources in-house to allocate towards and are easily outsourced.

From a strategy perspective, however, clients receive better results when the motivation to provide lasting business value is the core of the relationship. When a business contracts with a firm and pays not for time, but for value delivered, the relationship is aligned from the start and the firm evolves from a traditional deliverable-based resource to a strategic partner, which is exactly what you want as a client.

With the performance-based model, both the client and the consulting firm share the risk of failure. If the firm falls short or underestimates the time or effort involved, it will lose out on revenue from the work and the client does not pay for time involved. However, the inverse is also true in that if the program works well and results are achieved or exceeded, not only does the client gain but the consulting firm would be paid for value delivered, regardless of the amount of time and resources it took to achieve the results.

Performance Based Consulting Example

Let’s say that a growing startup, Beta Corp, wants to introduce a new product to market and start expanding its offerings. Their team has no experience in this new market, but are confident in their research and the impact this product will have on their business.

Beta needs a group of experts to guide their product launch, so they hire Acme Consultants to deliver and execute a strategy that both parties agree should increase sales by $1 million over the next six months with this new product.

Without this help, the product will fail. So Acme takes on the project and charges a 10% success fee ( $100k ) for managing the product launch. For additional motivation, Beta and Acme adds an incremental 2.5% bonus for every $500k in sales achieved beyond the targeted $1m.

Now Beta does not have to worry about how much time Acme takes, nor do they have to worry about how many consultants are on the project. Instead, they collaborate freely so that they can both achieve their goals. To ensure that Beta has some skin in the game, they allocate 30% of the expected success fee ( $30k ) and pay this monthly over the six month agreement ( $5k/mo ). Now both parties are invested in this project’s success.

At the end of six months, sales of Beta’s new product reached $2.5m, higher than anyone had hoped for. Beta’s launch was a huge success and Acme has earned themselves an additional $62k in bonus commission.

Revenue and Equity Share Consulting

Like a performance-based model, both the consultant and the client come to an agreement before the engagement begins to determine what the total opportunity, value, and success metrics are for the entire project. However, rather than the client paying for value gained ( or saved if the objective is a cost savings program ), the consulting firm would either take an equity position as an investor would or a percentage share of attributable revenue ( or savings ) over a specified period of time.

This type of engagement is where Bold seeks opportunity and partners. While not for every client or engagement type, when the revenue or equity share agreement is available, the client would pay only a small monthly fee and then the remaining fees come only after success and would come directly from the revenue or savings derived from the program, either as cash or equity depending on the agreement. The consulting firm has skin in the game just like the client does, and both are equally rewarded at the end.

Programs built on value-based and revenue / equity-based agreements are where I believe the future of consulting, strategic innovation, and business growth will come from. These three models directly align the client, the consultancy, and the consultants with the same objectives and outcomes, and all parties are equally rewarded for wins, or, they share equally in the losses.

In this example, Beta’s product launch continually gets delayed because of poor program, project, and vendor management, causing them to lose $50k each week of delays. Beta decides to work with Acme to speed up the launch and get their program moving successfully.

Acme comes in with a plan to shorten launch date from 12 weeks to 6 weeks, or a 50% improvement from before. This efficiency will effectively save Beta $300k. Acme proposes a monthly retainer of $3k and a bonus commission of 12% of the total savings. This aligns both parties to get this project launched as quickly as possible. The faster Acme delivers, the more they will be paid and the more Beta will save.

Acme delivers one week earlier than anticipated and earns themselves a $42k bonus for completing the project in five weeks, earning a total of $67k and saves Beta over $300k.

The relationship between agency and client is evolving, and hopefully more agencies move into either a full-performance model or some sort of blended structure.

We believe that the most innovative business ideas and opportunities come when more than 60% of our fee is contingent on the results that our ideas deliver in the market. Certainly a Bold idea, but one with the greatest client / agency alignment and produces the most profitable results for both.

It’s Time for a BOLD Idea

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As you may know, I’ve been living in the Chicagoland area for a few years now, working as the CMO for a few great companies. We accomplished some amazing things, but on the personal level, none of it was very fulfilling.
I’ve been noodling on the idea of a true Pay for Performance marketing agency for years and have talked about the idea with some of my collegues and other CMOs, only to come to the same conclusion – the industry needs it.
Well, I’m happy to announce that I’m taking the plunge! I’ve started BOLD, a true performance driven agency for startups, entrepreneurs and growing brands.
I started my career on the agency side, then shifted to the brand ( dark ) side, and now I’m excited to be back where I belong. I think real brands and real business owners that are trying to make an impact aren’t looking for cute puppies or craft beer selections as their determining factor for hiring an agency, but that’s what this side has come to. BOLD will get back to the roots of creativity and making an impact.
My vision for BOLD is one where the true hustlers and visionaries can come, roll up their sleeves and get dirty with us to create something that’s truly meaningful and makes an impact in the market. Don’t just hire your agency – bring them in as a partner.
No Gimmicks. No Games. No Bullshit. Just hardworking people creating something wonderful.
There are a lot of people ( very smart, well respected friends of mine ) that have told me this won’t work. They could be right. There’s also an equal amount that think this is genius. I’m on their side. Regardless – we’re going forward and I’m happy to share the experience along the way if it helps to create a better client / agency relationship & industry.
What Makes It So Bold?
  • A true pay for performance agency ( only paid when we succeed )
  • No contracts, month-to-month marketing services
  • Affordable, transparent and flat-fee pricing
  • Experienced & proven startup & business veterans
  • We’re in it together, taking on equal risk & reward
Obviously, as I launch, we’re looking for customers to get this off the ground. I’ve a few now, but if you or a group you know could be a BOLD fit, please reply and let me know – we have 3 services to start from.
If you’d like to partner and be a part of this, then let me know as well.
I welcome and appreciate any feedback you have for BOLD and the ideas. Thanks, as always, for the support and candor.