Transcription
This is probably the most important video I have made so far because today I am breaking down how to sign clients that pay you 20K a month or more. And whether you can pull this off determines whether you build a real agency model where you have a share in the performance on the back end or you stay stuck in the trenches grinding for that 3K a month retainer wondering why your revenue is flat.
Because after hitting 220k a month with my agency AdLab, I realized that anyone can do this almost overnight. I know that sounds cliche, but if you stick with me for just a few minutes, I'm going to hand you the whole model so you can just copy and paste it into your agency. So, let me get into it.
Generalists do not get paid 20K a month. The reason generalists are not paid 20K a month is how you perceive to the market. If you think about it, there's a million general agencies that will do this, do that for pretty much anyone. But if you perceive yourself as a specialist, that client knows that they're coming to you to solve a particular issue and you are the best at it. So, when they get that big invoice, they're happy to pay it. And the way that you structure it by having a part in the performance, it's a no-brainer deal for them. Less risk, all upside. So, not only is it easy for you to close deals, but you actually get paid more along the way, too. Just remember that if you look like everyone else, you will get paid like everyone else, which is 2 3k retainers and nothing more.
Let's make an analogy to make it a bit easier for you to understand. Okay? Say you have an issue with your heart. Dr. A is a general practitioner. They do knee surgeries. They do elbow surgeries and they also do a bit of heart surgeries. And then on this side, we have a cardiac specialist or cardiac surgeon, whatever you may call them, a heart surgeon. And he only does heart surgeries. And he's got a record of say 5,000 successful heart surgeries. No issues have occurred. Best doctor in his field. You have an issue with your heart. Which doctor are you going to? And who would you pay more to see? This one is definitely driving a supercar. The generalist is not. And now think back to the agency model. And that's how prospects see you through a lens of is this person a generalist or a specialist.
At AdLab, we do Google and YouTube ads for e-commerce brands and nothing else. And because I'm not desperate for any deals, I literally don't take any other deals if they come across my desk. This focus allows us to take a percentage of the upside. In my agency, we choose that upside to be a percentage of an ad spend tied to a minimum row. So, as long as we can get a certain amount of dollars back for each dollar into the machine, we can keep spending more and more money. And because we have an upside on that money we're spending, it's in our best interest to scale that as high as possible. But in the client's point of view, because we have that row minimum, it's a no-brainer. There's zero risk. So they let us spend 100, 2, 300, 400, 500k a month maybe, and they're okay with it because their upside is also protected or their profit is also protected. And when you niche down and you do the same thing over and over again, that's how you get the confidence to offer these deals and actually take advantage of the upside.
So for my own agency, we have SOPs for every campaign, every structure, every niche, every product. We know exactly what to do from the moment we on board them to get the most performance possible. And then we obviously get the upside when the performance is good. That's why your fulfillment also needs to be dialed in. So when they come in, you know exactly what to do and how to get them the best performance possible because you're not reinventing the wheel every time. It's productized or systemized delivery that you know that you're very good at. And that is what gets you the 20K plus a month billable.
And let me tell you something, because I've tried pretty much everything in the agency space. I am addicted to AB testing. And charging a 20k retainer is so much harder than charging 20K on a performance fee. It is extremely rare. Go out and try find me a client that's willing to just pay you $20,000 without proving your worth first. Often the billable will start at maybe 5K or even a little bit less. It'll creep up to that 20k a month mark, but because you've shown your value, because you've given them more profit, they're willing to pay those invoices.
Let's walk through the math. As an example, if you have a client, say you scaled them to 150K per month in spend, let's say you charge 10% on spend, that is a 15K billable on that spend. Because you've already performed extremely well for this client, they've had the profit roll through the door. They're more than happy to pay you that 15K for your contribution. You're only making money because you made them a ton more money than that. you're incentivized to actually perform and not just collect the check.
What I've noticed is most agency owners are scared of this model because they're simply not confident of their delivery. And that, my friends, is the secret to this pricing model is that you need to have super super dialed in fulfillment. If you cannot confidently tie your pay to performance, then there is something deeply wrong with your fulfillment. The confidence that comes from either you or the salesperson taking the call on your team comes from knowing that their back end is super super solid and they can perform for the client.
The main KPI that we track at AdLab for our Google and YouTube ads is ROAS. But obviously we need to reference this on other platforms like Northbeam uh like Triple just to make sure we get a better idea. But on top of that we're tracking ME which is marketing efficiency ratio and making sure that our ads are complementing all the ads that they're currently running or all streams of income coming into the business. And also on top of that we're supplementing our rorowass depending on how the other ad platforms are performing. Let me give you a really quick and easy example. So say our ROS metric on Google and YouTube is three. Say meta is normally three. We don't handle meta but we noticed that during the month their meta has tanked down to a two. We'll actually gradually increase our level or our height of rorowass to maybe 3.5 to try to compensate and keep that me as clean as possible. We don't need to do this. But what this does is make you look like a true partner to the business where you care about their profitability number one and not filling your pockets. And that's one thing that's very important to position yourself as a partner so that they're happy to pay these bigger invoices. You move from being a contractor or a simple agency to an actual partner of their business.
A lot of people will also say that this makes cash flow unpredictable which is simply not true. We have an internal Google look studio which brings in all the accounts we're currently running. We have a ROS metric and a spend metric for each account. So we know, okay, these are on track. We're above ROS. All good. All good. No problem. And then we know the spend levels that they're currently pacing out and how much we'll make at the end of the month. So predictability is just as easy. You just need to use some technology to gather this data and then it paints a very clear picture on what you'll get paid at the end of the month. This also makes it very easy to track everything. If any account is falling under ROAS minimums, it will change color and it will alert me and the senior team that hey something needs to be done. It also makes it extremely easier for senior leadership to see how all the accounts are doing without going into each account and checking rorowass or spend levels. We actually have our own studio that changes color depending on if it's below or above target rorowass as well. So senior leadership can take one glance. Okay, this one is struggling. Let me talk to the team. These are all doing good. Okay, let's keep pushing spend. Build something like this if you don't want to be in the weeds every single day.
On top of this, I built a Slack scraper AI which pulls all the conversations happening from all the channels, knows exactly the information that I need and summarizes them into one message at the end of the day, telling me all the information that I would need to know. That way I literally don't go into any channel. It's a very simple summary that says the fires, the wins, and what needs my attention. By the way, if you want access to actual SOPs, systems and models used to run my agency. I put everything inside a school community that's filled with seven figure agency owners, which I'll leave in the link below.
So, we build SOPs as well for literally everything from onboarding, campaign setup, optimizations, reporting, literally everything. SOPs are one of the main reasons why you can be confident in your back end because you know the good work is going to get done. Your SOPs should be detailed enough that someone can step in without you having to guide them at all. SOPs will let you hire people who can actually execute without you being the bottleneck.
So I also realized along the way that pod structure was the best way to run the agency. So each pod is responsible for their certain amount of clients. They're responsible for extracting a certain amount of money from them and they're responsible for making sure that they do not churn. On top of them, we have senior leadership that's making sure each pod is performing and that obviously each staff member is also happy with the job that they're doing. Pretty much any issue that will arise from a pod will go to either the ops manager or goes directly to my COO if it's a large issue. There pretty much is nothing that needs my attention anymore because we've built out systems to deal with all of this.
This also helps us catch underperforming accounts before it becomes a problem. So within that pod, if it starts to underperform or an account starts to underperform within it, obviously they'll try to fix it as fast as possible. So, the issue has gone from the pod to senior leadership. And within that week, if they still haven't been able to fix it, we'll be alerted in a Slack channel, which means my COO will need to go book a call with that underperforming client. And on that call, we'll go through a 90-day road map to say, "This is what we're going to do for you. We're adding extra resources. Don't worry, we're not going to leave you behind." Obviously, make sure that they're being cared for, and this severely reduces churn. The number one thing you want to increase when the performance is down is communication.
And within that pod structure, we also have a review process to make sure nothing goes wrong, nothing slips up, or that we're not missing anything important. So the media buyers that are actually doing most of the work will need their changes approved by either the CSM or the strategist or both of them if it's something important for the campaign setups and anything easy. There's already an SOP for it.
The main reason I'm talking about this is because when fulfillment is systemized, you can confidently offer these deals, scale the spend, scale the performance without scaling your involvement. I can hand off these accounts, be 100% confident that the best work possible will get done for our clients. And you want to know what the even better part is? When we scale our client spend from say 50k to 150k in spend, our revenue triples, but our work remains the same. We got better at fulfilling for our clients. And that's why I can be so confident in charging a percentage of upside because I know the team is going to deliver time and time again without my involvement at all. Trust me, there's an insane positive feedback loop. When you niche down on your service, you get really, really good results. You make money, you learn from these experiences, and you get more results, more money, loop, loop, loop, positive, money, money, money. But fulfillment plays a huge role in this when it comes to getting agency clients that pay you 20K a month or more.
Now, in this video, I covered a brief structure of how fulfillment should be running. But if you want the exact templates, the SOPs, the dashboards, everything laid out for you so you can just plug it into your agency, I put all of that inside the school community, which you can join using the link below. And if you want to see exactly how I scouted my agency that has managed over $150 million in ad spend, click this video.