1
Customers Left Us
$
1
K
Annual Revenue Lost
1
Lessons Learned
Case Study: All Our Failures in 2020
See how we did it.
We can’t service SMBs and pre-product startups with little marketing budget very well.
1: We didn't know our strengths
Total monthly revenue lost: $4,750
What happened: When we first started out, we wanted to provide marketing for businesses at every level. But we didn’t know how demanding that could be with smaller companies. We had one local customer who we helped the first month of our engagement. We improved conversion rates by 30% and organic traffic by more than 15%. But the next month, we didn’t focus on them as heavily. The same amount of work didn’t get done. They (understandably) didn’t appreciate that, and asked to cancel our services.
Lesson learned: We figured out local SEO and SMB marketing aren’t our jam. Our skills and work style are more suited for SaaS PPC marketing, b2b marketing, and SEO for fintech companies. So now whenever we get a local SEO lead, or someone who’s early in bootstrapping their business, we pass them on to some of the coolest (and most experienced) smb marketers we know.
The pandemic really screwed a lot of our future plans up. But we learned a ton.
2. 3:1 client ratio
Total monthly revenue lost: $30,000
What happened: Long story short – the pandemic happened. It was a bright sunny day, and I was on my third walk in 4 hours. Why? We had just lost another customer. At the time we had two customers who made up 75% of our revenue. We were doing really well, but we didn’t realize how exposed we were to the market. When we heard about other boutique marketing agencies shutting down, we realized they were in the same boat as us.
Lesson learned: We lost 75% of our revenue in 48 hours. That sucked. So now we make sure for every 1 huge client we have, we have 3 smaller clients that match that large account’s revenue. That way we’re never screwed if a large account leaves.
We can’t project manage your other vendors. And we can’t recruit for your organization.
3. Don't over-estimate your skills
Total monthly revenue lost: $13,000
What happened: We had a few customers who had unique issues they were looking for someone to solve. The problem was, these issues fell outside of our normal core offerings. But we were confident we could make an exception, and it came back to bite us in the butt. We stupidly did this a few times. It never ended well. We over-estimated our ability to work beyond our strengths
Lesson learned: Don’t commit to something unless you’re 95% sure you can accomplish it. And if you’re overly sure of yourself (like our CEO is), make sure you put a system of checks and balances in place with your executive staff. Run it by them, and make sure they’re honest enough with you to tell you if you’re wrong. (And if you’re a one person band, get some advisors, then listen to them).
We’ve had to scramble a few times, and cut our executive staff’s salary in half to pay our employees and make ends meet.
4. Politics happen. Get a piggy bank.
Total monthly revenue lost: $5,000
What happened: Sometimes life (and company politics) just happens. More times than not, we work with VPs of marketing or CMOs. That means there’s someone above them making the rules. If the CEO puts their foot down about needing to save cash, marketing budgets are usually first to go. Our CMO contact can’t do much about that, except tell us they’re cancelling all or part of the SOW.
Lesson learned: Budget accordingly. Make sure you have enough in the piggy bank (ideally 3.5 months of operating expenses) so if and when something like this happens that’s beyond your (or your clients’) control, you won’t feel the hit so hard.
Bonus: Having savings also alleviates any pressure from taking on a client you don’t want just to make rent
We’re nerdy, love data, and proactive about our work. We’re positive people. Passive aggression, belittling strategies or people, and superlatives like “always” and “never” don’t vibe with us.
5. Vibes matter
Total monthly revenue lost: $13,000
What happened: We took on some bad customers. And to be specific, we mean bad for us. We like being partners in marketing with our clients. We don’t respond well to being micromanaged. And some clients need more client service attention, or a “pull-lever-execute-here” type of engagement. Neither of which are necessarily bad, just not our style, and we’ve learned that we often don’t end up satisfying what they need.
Lesson learned: After some messy breakups (one even threatening lawyers), we realized we perform really well with a specific type of client. Now we look for that in every sales call. If we don’t vibe with them, or think they won’t vibe with us, we pass them on to other agencies we know who better fit their personality types.
