Everybody wants more sales, and this comes down to the number of leads you have. But how do you get more leads? Penny Zenker has the perfect guest in this episode. The king of lead generation, Phil Smith, is with us to spill the secrets to finding success in digital lead generation. As a nationally recognized solopreneur and business investor, Phil has grown his wisdom around creating a successful business. He imparts those with us by sharing not only the biggest mistakes people make when looking at lead generation but also the biggest secret to getting the results you want. Tune in to find out the key differentiator to grow your leads. Join Penny and Phil to learn more!
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The Biggest Secret To Find Success In Digital Lead Generation With Phil Smith
We are talking to Phil Smith, and he’s got a great deal of experience that we are going to talk about lead generations. For those of you who are managing your own company, you might be a solopreneur, a senior exec at a company, or in a sales position, this is something you are going to want to read.
Let me tell you a little bit about Phil and his background. He’s a nationally recognized solopreneur and business investor with a knack for helping entrepreneurs and business leaders identify key verticals to exponentially grow their businesses over and over again. He’s a serial entrepreneur with over twenty years of experience.
He’s sold over three companies and for three years in a row, he’s made the Inc 5000 list of the fastest-growing companies in the country. He’s got a heart for helping people in their businesses, both big and small, solving problems, and making money in new and interesting ways. Let’s get into the conversation with Phil and let’s make some money.
Thank you for having me. I appreciate it.
You are the king of lead generation. That’s what everybody wants. Everybody wants more leads and sales. They feel like it’s all coming down to the number of leads that they have. Also, the number one problem that people have is getting more leads. What would you say is the biggest mistake that people are making when they are looking at lead generation?
The biggest mistake is that a lot of companies try to go about it on their own and without speaking to people that know what they are doing. I see that over and over. The biggest thing is that they don’t know what works for them. What I mean by that is, for example, the internet marketing has changed drastically. I started my first business in 1998, and back then it was Yahoo. There was a unique way to get number one on Yahoo, and then Google comes out in the early-2000s, changes things up, and it’s just constantly changing.
Even if you are an expert at Facebook, that changes practically monthly with how their algorithm changes. You have to stay on top of things. Because TikTok all of a sudden comes about, even people trying to make money on Snapchat and all these different platforms. The problem is that even if you are good at it, trying to keep up with the changes is difficult. It is a full-time job. Companies usually go down the wrong path. They are using the wrong platforms and doing the wrong targeting. The biggest secret sauce that I have beyond generating leads for a business is monetizing your leads outside of your core services.
I want to go back to the mistake that people are making. Before we go into the secret sauce and some ideas, I want people to let that land. You might have said some things that didn’t resonate with them. I want them to be able to understand. My interpretation of what you are saying is that a lot of companies out there know enough to be dangerous and I represent that right there.
It’s like spray and pray. They are throwing their money out and they are frustrated. Time after time, they are not getting the results because they are dabbling. They are just spraying and praying that something’s going to happen. They don’t have the knowledge of each of these platforms. Very often, I have seen this too with companies that I have coached. They are on the wrong platform for them.
They read an article that said, “You should be Facebook advertising,” and their target market isn’t even on Facebook, and they’re advertising and throwing their money away. Am I connecting? That’s part of what you are saying about needing some expertise and defining also your target market to be sure that you are on the channels where your best customers are.
I will give you an example. When I started running Facebook Ads myself in 2014, I was doing it in the business loan space at the time. I’m running ads. I need to know everything about my business across the board. I need to have an understanding because then when I do outsource it, have a consultant, or an agency and they start running ads for me, I know what’s possible. It’s important to me to go find the right people right off the bat. If I know I’m generating a lead for $10 and I go to somebody and they are generating for $20 and they say, “No. This is what it’s supposed to be.” I’m like, “No. What are you talking about it? It’s supposed to be $10. I’m already redoing it.”
There are so many companies that will go to an agency, for example, and they will tell them it’s $20 right at the gate and like, “$20 doesn’t work. It doesn’t work for me.” I have seen that happen so many times. We are running our own ads for TV. We get companies interviewed on TV. We are running ads for that on Facebook right now. The hourly cost is $8 for that.
We contacted another company that does the same thing to learn about them and see if maybe there’s a way that we can work with them. Maybe they are doing something we are not doing. Long story short, they told us that they tried to run Facebook Ads and it didn’t work for them. We are sitting here running Facebook Ads and we are crushing it. It’s funny how we said it all the time. You have these companies out there that try things. Maybe they try them once and it didn’t work, and that’s it, and they move on. Instead of realizing, “No. You got to put more effort in. You have to find the right people that know what they are doing,” which we already know.
Many companies quit too soon in the different platforms that they are using. There’s more than one way to do it. Some of them are pretty complicated. Google and YouTube are more complicated than any other platform. Facebook is very simplified especially how they changed it over the years, but there are still different tweaks and things that you can do to try to drive down your lead costs and get the right target.
I heard you say, which is an important point to pull out, that they quit too soon. You are very much relating it to digital advertising. Since we are talking about lead generation, I want to have everybody understand that can be across any strategy. It’s not just digital advertising. We quit too soon because we don’t get the insights and then continue to tweak it.
Everybody wants this quick fix and to get rich quickly. It takes time to build an effective campaign that’s going to crush it for you. Whether it’s digital, direct marketing, email marketing, or whatever it is, it still takes some time to get that. The other thing that I want to pull out of what you said is that people aren’t tracking it as well effectively.
You had hinted on that is that you want to know everything about your business. You want to know every stage so that you can track it and effectively know which levers you are tweaking so that once you improve the conversion, then the more money that you put into it, the more you are going to convert. That tracking element is also what I heard you say was right.
There’s something I will throw out there also. Your entire funnel needs to work together. If you are driving traffic to a landing page and let’s say you got a horrible conversion ratio, then now you got to increase the conversion ratio on your landing page and optimize that, and then from there, you got your sales process.
We use a lot of video. Somebody fills out a form on our website, we are going to send them to a video. A lot of companies don’t do that. They want to send them to a scheduled call because they want to talk to everybody. That’s very time-consuming. From there, long term, the email marketing, and SMS marketing, we do a lot of live Q&As from a sales process.
It’s like Kevin Harrington over here, the original shark on Shark Tank. These guys do very well overall. His son lives about twenty minutes from me and I was on the phone with him. They tell me about a campaign that they are running. I gave him all these ideas and how to drive down his lead cost from $10 down to $0. Another thing that we will talk about in a second is how to drive down your lead cost by monetizing your leads outside of your core product or service. One other thing I will say about running ads is pretty much every marketing strategy can work for a business.Pretty much every marketing strategy can work for a business. Click To Tweet
As we said, they quit too soon. Maybe don’t try things like direct mail. Direct mail works. I know a lot of people have tried direct mail and they give up too soon. You have to have the right budget in place to get it done right. I will throw this at you. We started running TikTok Ads for something and we were getting leads for $1, which is unheard of for the stuff that we do. We are going to leave for $1 and I said, “There’s no way we cannot make a profit. It’s a $1 leap.”
After 1 or 2 months, we are not making a profit. I could have quit and said, “It’s not working. We weren’t spending much like $100 a day. Nothing crazy.” All of a sudden, I’m like, “Let’s tweak the funnel. Let’s make changes.” The people from TikTok have very short attention spans so you can’t push them through an hour-long video like we had. We had to change it up.
Instead of saying TikTok doesn’t work, we change the funnel around to fit the TikTok mindset or their user behavior. All of a sudden, it started becoming profitable after another month or two of testing out and changing things up. We had to put shorter videos in front of them to get them more interested in what we are doing and then go to longer videos and whatnot. A lot of things work very well. Whoever is managing it, the business owner just doesn’t know enough, how to do it, and how to put everything in place.
The best thing I have ever done in my career over the years is joining mastermind groups. Hire a mastermind. I have been part of the War Room Mastermind. I’m part of Rise Nation right now with Daymond John, also from Shark Tank. I put myself around that type of person or group of people who are at the top of their game.
It’s the best investment I ever made. They are more expensive. You are talking about $20,000 to $50,000 a year, but it’s so worth it because you can’t beat the knowledge you will gain from people that are in that room that are at the top tier in the marketing industries. You will solve your problems in five minutes and you will meet the right people on day one.
I’m a big believer in that as well. The expression is, “What got you here isn’t going to get you there.” If you are hanging out with the same people, you are going to stay where you are. If you want to take it to the next level, then you go to the people who are already doing it ten times. Let’s talk about that secret sauce. People get it. They can see how it relates to their business, whether it’s online, offline, or whatever type of format. You said how you help people to drive down the cost and to help to monetize leads that are outside of their lead pool. What does that mean? I don’t understand what you mean.
The first time, I started doing it myself. Back in 2014, I was generating business loan leads. That business loan lead went from $18 a lead on October 14. By the time October 15 came, that lead was $70. I couldn’t make a profit anymore. I’m sitting there generating 100 leads a day and I said to myself, “I’m losing money now. What do I do?” In my form, I started asking additional questions. At the time, it was a business loan lead. I started asking them about their credit score. If they had a low credit score, I would sell that lead to a credit repair company.
If they were in business for a certain amount of time over two years, I had a business credit services company that would buy that lead for me. I had a company called NAV, which did business credit monitoring at the time. They monitored business credit. They took the leads in. I started working with marketing companies because every business needs marketing. I was selling off those leads.
I started finding more startup lenders. The key is I started putting all these other companies in play to start monetizing the leads doing other stuff outside of the business loans that I was doing. At the time, it was about $8 to $10 lead cost. I started making a profit on the leads before I even did my stuff, the core thing that I was doing at the time.
You are taking those leads that are coming in and categorizing them or creating separate lists from them and you are selling them off to other companies that could benefit from that.
I will tell you what I’m doing right now off Facebook. I’m generating leads for companies that want to be on TV to be interviewed on ABC, NBC, CBS, and Fox. On the form, I’m asking them, “Are you interested in a business loan line of credit? Are you interested in marketing services on Facebook, Google, and YouTube?” I’m asking additional questions. If they say yes, they are interested in marketing, I have a company that will pay me $56 if I get that person to sign up for a free trial for the marketing services. TikTok themselves will pay me $46 if I get someone to set up a TikTok advertising account.
I have companies that will buy the business loan lead for me. I have a startup lender that will pay for startups. I have business credit. Incfile will pay me $125 if I get them to set up a corporation through them. That’s the thing. I want to sell TV interview services, but here are five other companies. As long as they fill out the form correctly, the label goes to the right person. It’s all automated. Once I drive my lead cost down to zero, I ramp as much as I want because now my leads for my core services are free.
For those of you who are reading, this can be done in a lot of different areas. It’s how you multipurpose an asset that you have. In this case, you are getting those leads in that you are not necessarily able to use them, but somebody else will. It drives your price down. It makes it more profitable.
I want you guys to be thinking, could you be doing this with leads? Could you be doing this with your existing customers where you can create other partners who have other needs and with a simple survey you could pass them along and create a win-win by recommending and referring them somewhere? How can you multiply the value of the assets that you have and make it a multiplier?
Coming back to other strategies, you are talking about doing and making effective ads. Is that your main area? What other types of tips or tricks could you give people who are reading to help to maximize their lead generation so that they are getting more conversions? That’s also a major issue. I don’t know if that’s something you can speak to. Let’s say I get these leads in. How do I convert more leads?
Automation is key. Once you are generating leads, driving traffic to your site is the easiest thing anybody can do with all the platforms. Doing it correctly and for the specific company is its own issue. Let’s say you do have the right traffic and you can generate as much traffic to your site. The rest of it is the rest of the funnel, your conversion optimization. I see so many companies drive traffic to their site to go try to buy something. It’s the last thing you want to do. You want to collect the data. Data is so important. It’s the most valuable thing you can ever have. I do not let anybody do anything with me unless they give me their information first.Once you are generating leads, driving traffic to your site is the easiest thing anybody can do with all the platforms. Click To Tweet
I have millions of leads that we have generated, but in one in my AWeber account, which is my email marketing software, I have 800,000 emails in that account alone. They are all B2B. It’s all businesses. When I come up with a new offer or something that we are doing, I send that email to 800,000 people and see what happens.
I have people that have been following me since the late-2000s when I started getting involved in this type of stuff and having a following. What happened was they showed up to my masterminds saying, “I had been following you for years.” I think that’s crazy, but this shows the value of the data. Keep advertising to it because whatever you do down the road that changes, you still have that.
Even if it’s a company that has the data and it’s your own customers, your own leads, or your age leads, that’s still valuable. You can’t throw that away because maybe you do come up with something down the road in 6 months, 1 year, or 2 years. Now once you have that data, having that automation, emailing them, and texting them with different messaging. The further down your funnel they go, you want to hit them with different messaging. Let’s say a company is interested. One thing I will throw out there is if someone is reading this right now and say, “I have another service that I could promote on the side. It’s a partner company. I’m going to become an affiliate of TikTok.”
You want to create another list. You can’t have one list and email all your leads from that one list about different offers because if they unsubscribe from your core service, you don’t want them to do that. You want to create another list that’s for service A, service B, service D, and service E, so if they unsubscribe from service A, no big deal. You can still hit them with other stuff. It’s very important because a lot of people do it wrong and they turn around and say, “I lost a lot of people because I send out an offer nobody wanted.”
Being relevant and contextual to what somebody’s looking for is important. I like that tiered approach that they are in your database but you can have them opt out of one list but still in another list.
Over the years, I spoke at a War Room Mastermind event in ‘18 or ‘19 about monetizing your data. Two hundred and fifty people all generate at least $1 million in revenue. I had no idea how it would go over the first time I ever spoke about this in public because I was doing it myself. I was shocked at how many people came up to me over the next two days. I had at least about twenty people.
One guy, Michael Parrella who owned the ILoveKickboxing franchise at the time, goes, “I never thought about this. We generate 90,000 leads a month. I never thought about it. We got to talk.” I couldn’t believe how many companies weren’t doing this. Over the years as I started getting out there, I started telling everybody, “You should do this.” I had 3 people in my last 3 business trips come up to me that I have known for years.
This one guy is out of Austin. His name is Brad. He has a merchant processing company. I was in San Diego in March 2023. I ran into him at the bar and he goes, “I got to tell you. You put another six figures a month in my pocket.” I’m like, “What are you talking about?” He goes, “Back in 2019 when you spoke at War Room, that’s always stuck with me. I finally did it. I can’t believe I didn’t do it sooner. I have seven other ways I’m monetizing my leads now. It’s changed everything.” I’m like, “That’s so cool. You are buying the first round is what you are telling me.” Multiple people have come to me saying that they have put 6 or 7 figures in their pocket because they started implementing this.
I hadn’t thought about selling leads in that way, but I am a big fan of doing more with what you have. There are so many low-hanging fruit opportunities that companies have that are just sitting there. Like this other guy said, he finally got around to it. One of them is getting people to be aware of it and the second thing is getting people out of their own way to take action so that they can achieve that.
As you said, we will bring it around to where you can tell people where they can find more information about you. You don’t have to do it all yourself. You don’t know how to do all these things yourself. It’s finding the right people to help you to implement it quickly and capitalize off of those assets that you already have. How can people get in touch with you and where would you suggest that they go?
PhilipFSmith.com. We have a lot of sites obviously, but that’s my personal site. I have been partnered with Kevin since 2018. We do a lot of stuff together, so we speak at events if we need to. We do our own events where people come and hang out with us, and we teach them all the stuff that we are talking about right now. I do a lot of stuff in the financial space, business loans, mortgages, and a lot of lending. I love the B2B space. I’m not a consumer person. I can certainly help companies that point in the right direction, but I don’t do products. I’m more service-based.
Thank you so much for being here. Is there anything that I didn’t ask you that you feel that you want to make sure that you let the people know who are reading?
Nothing crazy. I will say is understand that 100% can be better. Everything I’m talking about might go over a lot of people’s heads, but I’m telling you that if you give me any marketing strategy unless you are Amazon, I will 100% make that marketing strategy better if someone does need that type of help.
There are so many strategies, so many things that you can do, automation, or whatever. It will be mind-blowing to people when you open up that book, the first page like, “There’s a whole book on this.” It’s crazy. That’s the only reason why I have been a one-employee company for so long, making the Inc. 5000 list. This year 2023 will be my 5th time on that list. I’m still one employee. Automation and software technology, that’s what you need to implement if you don’t have it.
Thank you so much for being here and sharing your wisdom. It was much appreciated.
I appreciate it. Thank you for having me.
Thank you all for being here. I hope that you took something away. Remember that even if you are not an entrepreneur and you are not running your own business, how can you do more with what you already have? How can you leverage the assets that you already have? You can bring some of these into that space as well.
For those of you who are entrepreneurs running your own business and bringing leads in, check out Phil’s site, take a step back, and put in some time. Block it now on your calendar to give this some thought and to dig in a little bit as to how you can create a marketing strategy like this that could add another six figures to your business. Why not? We will see you in the next episode.
About Phil Smith
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