Answering Your Mailbag Questions

About two dozen great questions surfaced in response to a LinkedIn post stating that I was going to do a Q/A this week. I’ve grouped them roughly in categories, and this week I’ll address the ones that deal with positioning and marketing. Then we’ll cover staffing and careers and culture. And then finally service offering design, financial performance, AI, and the health of the industry as a whole.

Positioning & Marketing

If you are JAFA (just another *ucking agency) under $5mm in rev—who is offering a commodity service and you don't have a clear differentiator—you don't have proprietary tech, notable clients, or a highly visible leadership team...what's the fastest way to test out positioning. Obviously niche is effective: rather than targeting ecommerce companies, we target ecommerce fashion brands that serve a particular audience. But often that kind of deep focus requires deep experience in the sector. So, how does the "average" agency owner, who runs an "average" agency, create positioning that is powerful?

Well, whatever focus you choose must emerge from something that you already have some experience in. Nothing changes overnight, after that declaration, except two main things (and lots of little things). First, your rate of building that expertise is notably faster. Second, you can now craft an efficient, more targeted marketing plan. If you feel like you need to “borrow” some expertise temporarily, find an experienced contractor who is okay with letting you pitch work based on their experience, and then of course use them for the actual work that you win. But how to decide where to focus more narrowly is covered in The Business of Expertise book, but you might pick up enough of the critical hints by applying these five pre-tests (test 1 here and tests 2-5 here) and then these four after-tests of your choice. I’ll close with this: the days of thriving as a generalist firm are over. In fact, they were over 15-20 years ago (save for the really proud, confident firms who are larger). So fix it as soon as you are able. Congrats for making the tough call!

How can your advice on strategic positioning and the pragmatics of running a profitable enterprise scale down to individual consultants? (I recently scaled back and I'm loving it, and leaning on what I learned in scaling an agency, but I'd love a boiled down "how to win at freelancing" version of your brain.)

Well, one of my favorite things about applying positioning to solo consultants (or smaller firms in general) is the forcing function it creates: you aren’t big enough to do lots of implementation, and so you inevitably have to make “Room 1” stuff work. In essence you’re standing naked in front of a bunch of paying clients with high demands, and your thinking alone needs to win the day. The smaller your firm, the more a simple Google Doc should be sufficient to guide them through the maze. Having worked with >1,000 firms, from 1-100 people, there is zero correlation between size and profitability (as a percentage). It's just nonsense to think you can’t do amazing work and make remarkable money as a small firm. In our community is one who works by herself and makes $3.4 million. It’s a combination of positioning, marketing execution, mastering the science of pricing, intentional service offering design with a healthy dose of productizing, and the sort of confidence that comes from knowing deep in your soul that you’re so unemployable that you’d better make this work.

There’s a lot of hype around what good marketing looks like. When it comes to firms, what in your opinion is the tried and true method for sustainable growth?

Whatever you land on should account for your positioning (clients in the fashion space don’t want to read your blog), assets (case studies, staff capabilities, etc.), and personality (extrovert? writer? networker?). But back to your question: the best plan is simple and fun, and it’s often not the same as what works for someone else. The principal should be the person most committed to making it happen, though. Without principal involvement, it’s unlikely to work. So think about those three things I started with and write out all the options, from having the intern stand on the sidewalk out front with a sandwich board sign all the way to writing a well-received book and all the big league speaking engagements that flow from it. Then pick the two or three highest rungs on that ladder that you can reach and kill it. Also important is to consider the appropriate mix between Gini Dietrich’s PESO model, focusing on the “Owned” rather than the Paid or Shared (subject to an algorithm) and Earned (largely PR in this case). It’s not as simple as I’m making it sound, so study that model carefully.

Before any of that, of course, make sure you’re growing accounts, following clients to their new jobs, and asking for intentional referrals.

So, everything should lead back to building your email list. Be a human and not a marketing bro on LinkedIn. And one of my favorite newer methods is to host a podcast as a way to get prospective clients and legitimate influencers to accept your invitation to have a conversation in public about their world. Check out Dr. Adrian McIntyre’s work on this (we asked him to present on this topic at a recent MYOB conference we do every year in Atlanta).

How do you build new relationships and continue to nurture them over the long-term?

I think the key to your question is “long-term.” If you’re asking how I do it, here’s my philosophy for the peer side of this. I always want to be generous in this community, and the easiest way to be generous is to be strong, which means that there’s very little risk in being generous.

Second, I neither accept nor provide any referral fees. If I say someone is good, it’s because I think they are (I might be wrong, but my motivation is not skewed). It’s 100% based on merit.

Third, what’s your view of the world? Is it full of endless possibility and not a zero sum game where someone else winning means that I have to lose? That’s ridiculous.

Fourth, you have to be ceaselessly committed to doing what’s best for your clients. If someone would benefit from more of a coaching style, I’ll frequently recommend someone else. And if one of those people I recommend runs across a lead that’s a better fit for my remarkably bubbly personality, he or she might send them to me. But there’s no expectation. Just do what’s right.

In terms of building relationships with prospective clients, it’ll boil down to a three-pronged approach:?

1. Be in the helping business. Always, and over the very long term. Most of the people who read our stuff or come to an event or buy a book will never send us a gob of money, and that’s totally fine. Enough people will, and if they don’t, we’ll just close up shop and do something else. No begging. No desperation. No trying to please everybody.
2. Have a POV so that someone who hires you already has a rough outline of how you think. Peel off narrow slices of your expertise and demonstrate how deeply your expertise goes without giving the bulk of it away.
3. Don’t follow other people’s playbooks. Be yourself, be self-aware, be interesting, be gracious, be bold.

One last thing, and this one means a whole lot to me. Really listen to people and try to understand them. Approach everyone as if they are supremely interesting, because they are. In a world of near constant digital distraction, human connection can cut through the clutter like a razor sharp machete.

(When you do come across an insanely self-interested or even slightly evil actor, cut them off at the knees, without regret or concern for what others will think, and safely assume that the truth always surfaces and that you’ll be vindicated. Thankfully, though, these people are rare and easy to spot.)

How can you measure if your positioning is tight enough before rolling it all out into your marketing efforts? Are there common signs when you are keeping it too broad or too narrow?

The most obvious sign that it’s too narrow is insufficient opportunity, though often it’s really just lousy marketing. But you always need at least 2,000 examples of your ICP, and ideally something closer to 10,000. You should never assume that you can lock up more than 1% of any given market, which then easily gives you 20 clients or more.

The most obvious sign that it’s too broad is prospects regularly seeing you are interchangeable with other firms. Positioning is about Level 1 stuff: the potential client says, “how do I narrow down the consideration set to a half dozen firms or so who are experts in what I need.” Then the Level 2 stuff steps in and further distinguishes you from those other half dozen choices. That’s where you’d rely on process, IP, pricing, a POV, ease of getting started with you, client testimonials, etc.

Next up: Q/A on staffing and roles and culture, and then financial performance, AI, and where the industry is headed.