Episode Transcript

Hi folks, my name is Kevin Dunn. And welcome to Agency Unfiltered, a bi-weekly web series and podcast that interviews agency owners around agency growth, operations, and scale. Nobody knows how to scale agencies better than those that are already doing it, and they're happy to share an unfiltered look into what has worked, and what hasn't. In this episode, we have our first returning guest, Gabriel Marguglio, CEO of Nextiny Marketing. From Sarasota, Florida, we talk about how his team realized an opportunity around technology and software, learn about the opportunities available for platform consultancy agencies, the additional value you can drive with technology and tech stack development, and the best way to validate potential software partners. Agency Unfiltered, let's go.

KD: Gabriel, welcome back to Agency Unfiltered. From Sarasota. This is an important episode because you're actually the first guest that we've had a second time. So now you're setting a new precedent. But I think today is going to be a great conversation, simply because you and Nextiny Marketing have great experience working with platforms and integrations, and tech stacks. I think it's fair to say that softwares and technology are speaking to each other like never before. And that presents an opportunity for agencies, both for solving for clients, but I would imagine that there's some revenue opportunities as well.

GM: Definitely, I feel like there is a huge opportunity for agencies to embrace software. I feel like there's such a. I see it on video, you know. It's like I compare it with the video side of things. People are not doing video because they feel it's so hard and expensive, same thing. Same situation, same opportunity. Embracing software and embracing a platform without going all in on, you know, choosing one platform right here right now in HubSpot, but definitely choosing a platform and embracing the platform. You can, first of all, generate more value for your customers, and differentiate your agency, which is huge right now because everybody is doing the same thing right? Everybody is blogging, everybody can blog, everybody can send emails, how do you differentiate your agency? Software is definitely the answer.

KD: Gabriel, if I'm an agency, I'm bought in on this idea, I don't currently do it at all for myself or for my clients. I'm very familiar with, maybe like a resell of HubSpot, building some services on top of it. Where do I get started, what's the blueprint to enter this new opportunity?

GM: And there's two things, one, as an agency, you can choose to just start using a tech stack, start testing tools, and start offering this to your customers to generate more success, to generate more value out of the same activities that you do. Because in the end, we're all blogging, we're all doing SEO, we're all. But if you add layers of quality, or layers of features, or layers of intelligence and insights, then all of that creates, with the same amount of time, you create more value, therefore more growth. So that is the first thing that I would recommend agencies. And then, of course, all of that takes you to the next level, you can help companies find their tech stack too. So at Nextiny, what we did is we decided on our tech stack core software options, which is what we do for everybody. Hubspot, Wistia, Databox, SeventhSense.

KD: So to execute this retainer, this is the software you need.

GM: This is what you need. But, also we continue to learn on other software that we know can add more value, and we keep adding layers depending on the needs of the customers. So if we take on this specific industry, or this specific customer, that text messages are more important or calls are more important, or videos more important, then we can add layers like Panadoc or SnapApp, or specific software that does one thing. So I feel like learning what software does and how to connect it, and how to get the value out of it is the key right there.

KD: And you mentioned, so to build that core stack, you mentioned that there's a lot of testing that has to happen, right? So, there's this evaluation process on what sort of technology needs to go into your agency's stack. What's that evaluation process look like, how do you know it's something you want to add in, like how do you validate these various softwares?

GM: So for us, we started with HubSpot, HubSpot is the hub, the main, the core part of everything. You know, when you have HubSpot in the middle, then what you do is you connect everything to HubSpot. Some of the software that you choose is not going to be connected directly to HubSpot because it might be something that is external, like an SEO tool or something like that. But what we're always trying to do is we try to find software that integrates as much as possible with HubSpot because that helps us make the most out of the tool. So that's number one, if you choose a platform it's going to be a lot easier to find software that connects with that platform, and makes that platform, that software works a lot better for you. So, then how do you decide where to start, right? We wanted to do video three and a half years ago so we decided to find the best video tool at that time that integrated with HubSpot, that was Wistia. So we started working with Wistia. And it's not just the software that's important, for me the key is the partnership. And I feel like that's what a lot of agencies don't see, is the opportunity to create another partnership. So, we're HubSpot partners, then we're Wistia partners, then we're Databox partners, then we're Seventh Sense partners. These partnerships are not just pieces of software that do something and it gives me a new feature, and maybe a little bit of value for my customers. We create content together, we co-market, we create workshops together. So there's a whole value that comes out of that partnership. And it also puts us in a place of being the authority in these things. So now there's content by Gabriel, by Nextiny, posted in the Databox blog. We're creating videos for Seventh Sense, we're creating co-marketing opportunities, we're going to events with Wistia. So, these things help us as an agency and also, the more we do this, the more we learn about the software, therefore we can create more success for our customers. How do we test? We test, test, test, test, all the time, be testing. And one of the things we were talking about before is how do you find these softwares? Of course there is software, there is a connect directory in HubSpot if you're using a platform. There's a marketplace where you can find the best ones and reviews and all that stuff. Now the way we do it is depending on what we need, we would find one or two different softwares and evaluate them. But we also rely on our partners. So if we started with Databox and Databox is amazing and I talk to Pete constantly and he's the CEO, and then I'm like, "Hey Pete, what other software do you recommend?" He said, hey, why don't you check Encycle? This is a tool that helps you clean up your HubSpot database. We became Encycle partners and created content with Incycle. So I feel like relying on your partnerships to bring more partnerships and to bring more software to your Textact is crucial. Because these people are people you can trust, these people are people that are doing it. They know how to create software, how to market software, and they know what other people are doing and if they are doing it right.

KD: Right. So that means there's this whole element within this network of like word-of-mouth and suggestions and referrals, right? It's a little bit like voicing the customer optimization. That's what we were talking about. Who owns the testing? Is it just for the Nextiny account? Or do you ever, if this is a software you've never done before but you know it might be a fit for a particular client, will you test in their portal? How do you-

GM: This is amazing, because we of course want to test it with ourselves. But ourselves are not the best case study for every single software, right? We do a lot of videos so Wistia was easy to test it with ourselves and then show other people what we're doing. We also have an internally, a philosophy of not just testing things but creating more value over time for our customers, and how do you create more value? How do you upsell a customer next year? Creating more value for them, so one of the things we do is, we'll go back to our customers and say, "Hey, I will do this for free for you." Or, "I want to test," you know. I don't know, conversion. I wanna test bots and chat, and live chat. I wanna do some conversational marketing for you I'm not going to go all in and create 50 different finals for you. I'm going to create one or two bots, we're going to put them in the right places. We're going to say this is a high impact page, high conversion page. Lets put a Bot here instead of just the form. See if we can increase the conversion rate, by doing one or two of these things. Implementing the bot from Hubspot, or if you're testing software, that specific piece of software. We can then generate more value for free. Create a case study, test the tool to see if it is amazing or not, incorporate that software as part of our tech stack and already have a case study for it. So then we can go back to our other customers from what we learned we can tweak, we can optimize and then offer that as a service. So generating more value also allows us to create a new service that we can provide, so we can upsell current customers, sell bigger retainers in the future. It keeps growing and growing.

KD: Because it was a pilot or a test, it's low stakes. If it doesn't work you just pull it out. You bring up pricing. That's kind of where I wanted to go next. Here is your tech stack. I would assume that all of them come with their own unique billing and costs and payment structures. How do you consolidate that, or like how do you organize that for your clients? But then also the second half of the question would be what's the impact look like for your services, your retainers, your costs?

GM: Definitely. So, in the beginning we used to say, "Oh here, Wistia’s this money." And then someone says, go buy this and create that account there, and you need an email and you are going to get an email. When you get it click on it. Don't forget. Like that would drive people crazy. And actually one of our customers told us, "Hey, why don't you package this thing?" and I was like, "That is a great idea." So what we started doing is packaging. Okay, you pay your retainer, and then you pay Hubspot, and then you pay a software package. And we will manage this for you. We don't have to. You don't have to worry about creating accounts, deleting accounts, using the account, paying for it. Your credit card, my credit card. We manage it all. At the same time we went back to software companies and cut better deals with them, so we can get a discount for our customers. Therefore, we get $1000 worth of software for $500 bucks. Or we can get more software to test it on other customers and things like that. So we cut a deal with the software company, because we're doing so many things together, because of that partnership that we were talking about. At the same time I can say 500 bucks is your software package

KD: Oh, I was going to say. Does that trickle down to the customer and say it's actually more cost effective to purchase that software through you? Or is that a profit margin opportunity?

GM: No, no it depends on how you want to do it. Sometimes companies like agencies say, well if I get a discount then I'll still charge this, or sometimes companies don't even say how much it is and you can charge whatever you want and those are some of the different selling opportunities that software companies bring to you. In my situation, give it to me as inexpensive as possible so I can use this for everybody. Because if you do that, then I'm going to have a lot of case studies. I'm going to write a lot of content for you, so I believe that that's the best situation with an agency and a software company. At the same time we sell the idea of us having great partnerships, therefore you pay less for software. And it's easier, because we manage it and you're going to pay less than if you were buying all of those. At the same time, in the end we decided, instead of doing $500 or 700, 10%. Your retainer is $5000, software $500, $10, 00 software $1000. It is always 10%, it's easy math and it works. And again, the flexibility to do that relies on the partnerships that you create with all these. Because again, if you start adding software, it could be a lot of money. At the same time, how do we decide which software we keep? Does it create value for our customers? One thing, and again there's a whole conversation. You got Scott Brinker talking about it all the time. Utilization, are we using the software that we buy? You know, we're using the software 20%, 30%. In the end, who cares? If this piece of software that costs $50 helps me solve this problem and create more value for the customer, I will keep it. If it costs $500 and it solves a problem that creates value and it's more than $500, I will keep it. Therefore, that's the decision making process. It's not, are we using all of it? Are we not using all of it? Now going back using software or not, one thing we do analyze. Okay let's, this year let's analyze all the software that we have in our tech stack. Let's find three things that this software can do, so we can keep adding value. That's part of the process. It's not just testing software and starting to use it, because then you get automatic and you use one feature and then you waste everything else. But create a process internally in your company to test software and to decide what to keep, what to remove, and how you can use the software more and more to generate even more value. Right.

KD: So yeah, functionality. A, that is what you lean on for a particular client, but you have to be familiar with B, C and D. Sounds like those are growth opportunities.

GM: Of course and we fire software companies too, that's the other thing. We've done it many times, because two things, either the software doesn't do what they said they did, or the value is not there, or more importantly, the partnership is not there. And I feel like that's crucial too. If I don't believe there's a human partnership that actually is beneficial for everybody, we don't want to work with them.b Same as customers or employees or everything. It's that, we wanna have a great partnership.

KD: Right, makes sense. You mentioned that the software piece is 10% of the total services agreement. Do you see an impact of tech stack consultancies set up onto the services piece? Is it like more hours that are billable for you guys? Is it an additional service? What does it look like from the services side?

GM: What happens is we can charge more, because we're generating more value. In the end it's easy. It's not about. hey I'm going to be managing your tech stack, so I need more money. I'm generating more value for you, because I'm doing video or, because I'm sending emails at the right time. And then again we create a case. We have case studies about how we use software and that differentiates our agency. Because by closing the loop with Encycle, I can save four hours a month for you. And those four hours go back to you. Because instead of me using these hours to close customers manually. Simplex example. I'm actually using those four hours to generate success. So you're paying for my hours. I'm using those hours for you not to manage software. Does that make sense?

KD: 100%.

GM: And the value, it's two ways. Is, can I save time with it? Or can I create money with it?

KD: Yep. That's great. As you mature in this process, I would imagine that there are some operational nuances to being able to do this successfully. So obviously we talked about getting started, we talked a little bit about go-to-market, as I wanna fully adapt this and operationalize this. What does an agency need to change about their structure to make it happen? Did you hire somebody new? Who owns this at Nextiny?

GM: First of all, I have a lot of fun with this. So I'm the owner, and we're a small agency. We're a lean agency, and we're proud of that actually. That's part of who we are, and the way that we can do what we do, with the amount of people that we have, is with the utilization of software to actually generate more value, right? What we did is. First of all I test a lot of stuff. I create a lot of those partnerships. That's a lot of the business development that I do. Is creating these amazing partnerships, because it helps us grow. So I dedicate time of my day to create partnerships and create these opportunities. Then we can create content together or do these things together. Or and things like that. At the same time we have a software manager Brian he's awesome. He loves it, he tests software with me. We get excited about it. We have a meeting every week. Talking about what we're testing, what's working, what's not working. We have meetings with software companies all the time and he's like, no this is not AI. It says it was AI, but it isn't, so have someone that is excited about that internally that loves software. That understands the value of software and is also involved in the strategy side of things in the agency. He's a senior account manager. He's not just some guy, right? So he knows how we generate value and how we generate success for our customers, therefore he knows how software can help with that. Does that make sense?

KD: 100%, and so when you loop Brian in to say hey like, obviously he's passionate about it. He's going to help you out with this. Was there any unique elements to like training him on validation, valuation of software. How we should be going to market with this element of our business. Like was there a training aspect to it?

GM: There is not, we didn't do a specific training, what we did was we did it a lot, right? We incorporated software on pretty much everything that we do. Also Brian what he does is he tests the software with me and we create these partnerships, but then we deploy this to the agency, because it's not just Brian. Brian doesn't own all software pieces he is part of the process, but then Kara our strategist needs to be part of the process, because she is going to be the one developing strategy for customers. And then if we're talking video, then it's Isabella and Aaron. So then people that are involved in the process have to be part of the software decision. So then once we tested and we defined what works, what doesn't work. Let's deploy it into three customers. Hey Isabella test this thing, or hey Aaron do this, or you know we're using ASAP content now. It's an SEO tool. It's amazing you can do research with it. We just gave it to Dylan and Brian, and Dylan is doing all the content. So he owns content, therefore he's going to test it on a different level. At the end of the day it’s a shared responsibility, based on whose job function does it connect or sync most with. The same as video, software and tech stacks have to be own and everybody have to be excited about it. I feel like you can't do this by forcing it. It can't be the CEO saying, “we're going to do more software from now on. and everybody's like that.”

KD: That's a good CEO voice

GM: Right, that's my CEO voice. It should be people actually enjoying this and really seeing the value of using software to save time and that's the key to them. That gets them excited, right? And also to generate more with the same efforts.

KD: Sure. Final question for you. Now as you know we tend to ask everybody that joins the show what's the weirdest part of agency life. Now asking you the same question again as this is your second time on the show. That's going to be too easy for you So similar but with a little spin. I don't want to say the weirdest software that you've incorporated with a client or yourselves, Bbut what's like the most unique use-case that a software, or a challenge that a software has solved for you that's a little maybe outside the norm.

GM: I don't know if I would say the weirdest software that I've ever done, but I would say the software that analyses heat maps and usage of websites and you can actually watch a video of a person going through a website we use to use Hotjar and LuckyOrange. Amazing software. It allows you to do so much more than just heat maps and that, but that feature helps me sell more and it helps me understand more. So we use it to understand user experience and how people go through the website. Every time we do a website analysis to do a redo when we're doing a new website, we analyze how people are using the old website and then we compare it with the new one. We decide if people are clicking in places, but showing people how actual people are going through the website. Or showing a lead how they went through my website.

KD: Yeah, look at how this works for us.
It's the creepiest thing in the world and it's amazing, because it makes, it’s always like. Like it always. They didn't know that technology existed. Like, it creates that moment and those moments are beautiful. So I would say that, that is my favorite piece, I could tell you a million pieces of software that I love. But that's my favorite moment of all, is when someone says, " Oh my," like that is priceless right there.

KD: That is awesome. Well I have nothing left for you, thanks Gabe for coming on. It’s been a pleasure.

GM: Thank you, Kevin.

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