For our second episode of How It’s Done, we spoke to Arnie Kuenn of Vertical Measures.
Arnie launched a successful tech and distance education company in 1993, and went on to start another company, MediaChoice, in 1999. After a very successful five year stint where the company served clients who were major movie and music production studios, Arnie sold MediaChoice to Nielsen in 2004. After a brief sabbatical, he founded Vertical Measures in 2006, which grew to rake in a revenue of $3.7M in 2013. Vertical Measures continues to scale even today with Arnie as its CEO. Arnie takes part in regular speaking engagements, and is the author of the award winning content marketing book Accelerate!.
This is what he had to say about how it’s done in Vertical Measures.
1. What does your daily routine look like?
My daily routine, I would say, is always different. I think anybody who’s ever run a business knows that there’s very few days that are the same. Very few days that we can follow the same itinerary or schedule. But in general, my focus every day – the way that I’ve run this business and a couple of others – is to focus on sales and marketing. No matter what the business is, it’s not gonna thrive and it’s not going to grow if you don’t add new revenue to new clients, and that’s generally the focus of most of my days.
I have some sort of scheduled routine meetings almost every single day. I live in Phoenix, Arizona, and I start every single one of my business days by going out for a hike. So I usually try to get a couple mile walk or hike in every day, just to get ready for the day clear my head and get some exercise and get things started.
2. What made you start your agency? Tell us about your journey.
Well, prior to starting Vertical Measure, I had two other companies. (In the company) immediately before this, we were doing a lot of internet research. We had actually patented some technology and we were trying to license it on the large websites and just back in that particular time we actually raised some venture capital; but back in that particular time is when the Internet bubble burst.
That’s when it happened. So we ended up losing a lot of funding, we did OK, but we ended up selling the business to the TV company Nielsen. But during that journey I had learned how to do a lot of things that apply today – I learnt how to do pay per click marketing; I learned how to do SEO, and I built dozens of websites. I was helping friends and business associates get their websites going.
So it really started probably 20 years ago. And anyway when we ended up selling it, I actually moved home and we closed our offices. So I set up an office at home and my wife and I were just kind of talking about what are we going to do next, and I said well I’ve got a few clients already and that I’m helping with their internet marketing. I don’t know if we can make a business out of it or not but let’s at least you know set up a new company so we set up Vertical Measures in 2006.
And quite honestly, I was really just kind of gambling I wasn’t really sure that I wanted to build an agency, but after a couple of years, in 2008, I felt very confident that we knew what we were doing, we were able to find clients and we went out rented office space and put a stake in the ground and said we’re going to be an Internet marketing agency. And that’s kind how it started.
3. How did you get your first client?
Well the very first clients were friends, people that I knew in the business, who run companies and needed a website or had a website but they didn’t know what they were doing, and so the first two or three were pretty easy. But the ones that really helped launch us to an agency the people I did not have any relationship. I ran pay per click ads back then – branded ads to pull people to our website and to fill out a lead form, just like we all try to do today. We managed to get a few leads and was able to sell them and convince them that we know what we’re doing when it came to pay per click and SEO and link building and it made us different back then and probably gave us the foot in the door that we needed for some of these clients.
4. What is the biggest problem that you’ve faced as an agency owner? And how did you overcome it?
Well, I would say that you know the very first thing that comes to mind is it’s an oversaturated market today. There are thousands of digital marketing agencies in the United States. Many of them will claim that they’re good at different kinds of services; good at SEO or good at social media – whatever it might be – and they’re really not. You know they just for whatever reason; they are either incompetent or they shouldn’t said what they said; and so it gives us a little bit of a bad reputation. And then also it puts a lot of pressure on pricing. So it makes it more difficult to run the business that it was you know just seven eight years ago.
And so that’s probably the biggest issue or challenge that we face each day; how we overcame it is that we really try to lead with a specialty. So several years ago became really pretty well known as a really solid link building agency. And then we transitioned to a content marketing agency in around 2011 and became very well known for content marketing. And only recently did we decide to be a full service digital marketing agency and what makes us different today is that we tell our clients that we help them grow with their own audience – their own lists of people that are either customers or prospects that they can reach out to anytime they want – as opposed to constantly having to advertise, and that has so far been pretty successful. It’s only been two – three years since we got really solid teams for SEO, paid and content marketing. And we’re extremely confident that we can do well in all three areas of that business.
5. If you could go back in the past and tell one thing to yourself when you started the agency, what would it be?
I would say this is beyond the agency, but I wish I would almost always have a longer term view. Sometimes I let a year or two seem like that’s a long time. I think longer term thinking and planning is something I wish I would have done a little bit better job of.
6. How did you hire your first employee?
Yeah actually, that’s pretty interesting that bring that up; people who ask me my entrepreneurial advice or business owner advice, when they were thinking about leaving a company or starting your own thing I always tell them that I believe the hardest thing to get a business going is to hire your first employee. Because, if you think about it, they usually lead to SEO consulting or consulting restaurants, etc. But if you’re an independent consultant and all the money that’s coming in is yours, and you’ll try to work within a budget and you keep worrying about landing clients but when you need to go higher that first employee all of a sudden you realize that’s got all come out of your pocket. So whatever you’re making as an individual is going to get cut drastically now to help pay for this employee.
When we got going with Vertical Measures, we hired a couple of contractors. But our first real full time employee was someone I knew, I wanted to hire her as I had known her for a while, and when we decided it was time, we could not afford her. So, we made an offer that if she would come for a low salary we would give her a small stake equity position in the company that she could earn over a few years. And that was the only way we could bring her onboard and she agreed. She actually earned a small piece of the company and still has a small piece of it today. Her name is Patty but she’s not with us anymore but she still has that part of the company. When we sell she’ll get her share. But she stayed with us for about seven years and just decided it was time to move on.
7. What do you look for when acquiring talent for your agency?
That’s a tough question because every situation is a little bit different depending on what we’re hiring; sometimes we’re looking to hire junior people maybe right out of college, Maybe not even have a college degree but they show a lot of interest in what we’re doing and we can bring him on board and train them. But sometimes we have to hire a very seasoned and experienced person. I would say in general we are looking for people who are curious, who really want to keep learning and growing their skills because as you know we’re in an industry that is constantly changing.
You know you guys are all about local SEO and local search and that changes every month, there’s something significant that happens in that market. And you know everything from you know social media to optimization to whatever, you name it, there seems to be changes almost every week. So, you have to be curious, you have to want to learn and grow and there’s just no sitting still. We really try to find people that that seemed to have those quite that quality.
8. How do you manage things like customer churn and employee retention?
Yeah well, we work really, really hard at keeping both customers and employees. From the customer standpoint we’ve got a few things in place, but one of the things that we’ve done is made a really big investment in the process – we actually brought in a third party company to help us build and map our processes that we could serve our customers much better. And that was a very large investment that is definitely paid off because we could see it in our client retention. We also give a bonus to the entire company to keep client retention high, so the more clients we keep each quarter, everybody gets a bonus. So we’ve done that to help make the customer like us and stick with us.
Also, the bottom line for the clients is that we have to get them results. And I think we are really good in not only getting results but being able to measure it and quickly show the client the results they’re getting from our efforts. We present a nice short report sometimes one page reports that they see it and understand it and want to continue.
From an employee perspective that’s a little bit different. Best Places to Work is an award we won recently. We have eight core values that we all try to live by, the basic is that we just try to have fun. You know we do that through a bunch of different ways you know. Of course all kinds of awards, like, employee of the month, the person wrote the best piece of content each month; we allow people to bring dogs to the office, they can schedule a time to bring their dog through the day and we provide treats throughout the day. We’re not clock watchers. So we work really hard at creating a culture that people enjoy coming to each day, and that really helps in the retention.
9. What are the tools that your agency uses on day-to-day basis?
Yeah that’s going to be hard for me to answer because I don’t even I don’t use a lot of the tools that our team is using anymore. But each team, the paid team or the content team the SEO team, they all have their own sets of tools. Now we have tools that run the whole agency. I’ll try to recall a few but two big tools that drives the whole company are project manager tools called Workfront; and so we use that for time tracking to manage all of our client and all projects, internal projects and client projects. And then we use HubSpot as a customer CRM, sales & marketing and content tool.
Most of our website runs on HostPapa and WordPress. So those are the tools that almost everybody touches. You know we use all Microsoft applications and Google internally to produce internal and external documents and then from all the different teams you know everything from Screaming Frog to Ahrefs; on the SEO side, SpyFu, we use tools to build personas. The paid team use programmatic tools that we have. We use Wistia to create videos that we can share in e-mails.
We have lots of tools. And then you’re a tool company so I did mention we use yours. From a business standpoint we use HubSpot and we actually just signed yesterday a license for Hoovers, it’s called Dun and Bradstreet at Hoovers, but it’s kind of a prospecting tool. From a business development standpoint we’re really an inbound lead generation company or one of the few agencies I believe that really practices what it preaches to its clients.
And if you look there’s lots of agencies out there that are like I mentioned earlier on – they do content marketing and then I go to their site and I see they haven’t written any new content for six months. Of course I would get a kick out of it, and well, how can you go and tell your customers that this is the best thing in the world, and you don’t believe in it enough to do it yourself. So we’re good at that, we produce content couple of times a week. We’ve been doing it for many years. And so we get new leads every single day from our content marketing efforts. So that drives a lot of our top of the business development.
10. How did you help your agency scale?
Well you know I’ve been the kind person who always believes marketing comes first. So in the last three, actually, I started four companies, one of them failed. And I learned from that that I did not have a solid and financially backed marketing plan. I just kind of figured if I could build this service, people could find and would want to do business with us. But I learned a lesson that it just doesn’t magically happen.
So in the next three companies everything started with marketing and sales. But even for sales you need people to knock on your door, you know call your phone or just fill out your forms, so we market really really hard. And I believe that the marketing has brought in the sales which is brought in the revenue that allows us to grow; and that from a scalings standpoint, I think it’s just been key to to hire the right management, I suppose, at the right time. There’s different kinds of people who are very comfortable in a 10 person company and there’s a whole different kind of person that’s comfortable in a thousand person company. And so you’re going to have turnover and just I just think you have to understand that. And so as we’ve grown from two people to now we’re about 50. It’s just taken a little bit different skill set from a manager perspective and we look through that, we hire that and that’s allowing us to grow.
11. Top 5 songs from your work playlist?
The first song that came to my mind is something like, “I Need Never Get Old”, by Nathaniel Radcliffe, which you probably never heard of. Because I tend to be one of the older people in our business and I speak lots of conferences if they ever ask me what song I want them to play when I’m walking up on stage that’s the one I tell them, because I feel like I don’t ever need to get old. I love music. I have thousands and thousands of songs in my playlists but I never thought about it from a work perspective. Led Zeppelin fan, so I like almost any Led Zeppelin song. It all depends on my mood. But you know I would tend to play any kinda LedZep the most.
12. You’ve got so many speaking opps in the past – how do you prepare for them, generally?
I purposefully spent the last 10 years trying to get speaking arrangements, and in the beginning, you have to do small, local gigs, usually. And so finally I mean it’s where I speak all around the world. And I think the key is to know your audience first – what is it they want to hear? And then of course really knowing your topic and practice. I do see too many people where they think they can wing it, as if they’re at a company meeting or something like that and they get a stage and you can generally tell the people that you know are prepared in and have there timing down, and know their slides and to me it’s more work than most people actually believe or think it is. But it just boils down to knowing the audience and having the right presentation for them at that conference.
13. Top 5 marketing books that has helped you get where you are now?
Yeah I can at least think of a couple of authors, well I can think of three, actually. I like Scott Stratton and his whole UnMarketing series, he has a few “un” books. Jay Baer comes out a new book about every two or three years and I always liked them they’re always a fairly easy read, but they’re insightful and they usually seem to come across with unique perspectives. So almost any other books that Jay has written, I think are good for our industry. And then probably one of my favorite authors is the guy who started Content Marketing World and ran the Content Marketing Institute up until the end of last year, when he retired – Joe Pulizzi has written a couple books and I think the last one, it’s called Killing Marketing, I think? I really enjoyed that book and I would recommend it to everybody.
That’s it for #2 of How It’s Done!
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