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From the Desk of

Steven Werley

The Lead Generation Scam of 2024

Nov 25, 2023Business & Marketing

Marketing agencies feasted during the pandemic. Many businesses “invested” in agencies that focus on funnels and lead generation, and were scammed. The industry is broken – focused on funnel-hacking and cookie-cutter ad strategies that haven’t worked for half a decade.

Why is this easy to buy into? The promise: immediate leads for your business that you can call, have nurtured, and near-immediate revenue. Some marketers might read this and feel a bit triggered. To that, I say, “Good, be better.”

Not all agencies suck. Not all marketers suck. However, many get stuck in what has worked and fail to continue into what works. They don’t care so much about your revenue, profit margin, and business health, but rather what your LTV (lifetime value) is to the agency. That LTV should matter, but if results are through the roof, it’ll take care of itself as well.

And don’t get me started on the, “We can’t close the leads for you,” agency mentality. That’s an excuse to provide “crappy Internet leads,” as many of your clients choose to call them. I mean, Zillow and exist for realtors, but if all you’re doing is providing crappy buyer leads who still don’t want to pick up the phone when the realtor calls, you’re not a good marketer. You just know how to set up Facebook ads. But what if you were able to provide blazing-hot seller leads to realtors? Now you might have cracked the code.

How to recognize the scam

If you’re a business owner, realtor, or anyone else who might be reaching out to an agency, the first thing you can do is educate yourself. You don’t have to be a genius, but dedicate a couple of hours of your time to learning the fundamentals of modern marketing. Read reputable blogs from sources like DigitalMarketer and SEJ.

But let’s lay out the proper steps to go through when identifying the right marketer/agency to work with:

  1. Understand their website and everything they have. Does the copy speak to you? Is the overall impression positive?
  2. Read/watch their testimonials/case studies. Do they speak to you, and align with your business/company?
  3. Do research on those testimonials/case studies. Go look at their marketing and see if it’s something you want to replicate. If not, they’re not passing the sniff test.
  4. Hop on your first sales call with them. A good agency and marketer will want to know your situation, and on this call, you should be doing all the talking unless you’re signing up for a sales call for a specific service/program, at which point you may need to go in with the expectation that you will make a decision at the end of that call. If that’s the case bring on whoever you need to so both parties are respectful of everyone’s time.
  5. The agency should be able to pair you up with the right services, but they shouldn’t be trying to force you to do something over another. They should be the experts, and their reasons should be valid, but the decision should be up to you whether it’s a service you want or not. Now, if the agency is excellent, and you want to do something they don’t recommend, they will disqualify you and let you go.
  6. If the prices seem too good to be true, generally less than 1.5k/mo, and in my experience, closer to double that, then it is. The results will likely be lackluster and cost you more than hiring a better agency.
  7. Understand the communication dynamic, who you will be working with, and the team’s experience level.
  8. During the call, make sure this feels like a good culture fit. This is something that is widely overlooked in the business world. If you aren’t aligning with what the team is about, then there is a higher possibility of the relationship turning sour.
  9. See if you can create a realistic timeline of goals. Now, most agencies won’t promise results, and to an extent, I understand that. However, understand the terms of any contract you enter, and figure out the reasonable expectations for yourself. Make sure the bang is worth the buck, and if the results aren’t what was expected, you don’t need to keep that agency on your payroll for an extended period of time.

These steps will help protect your business, though nothing is foolproof. One thing that can get you into trouble is hiring an agency that prioritizes tactics over strategy. Let me walk through this because I don’t want you to rule out an agency simply because they focus on Facebook ads, which is a tool.

How to avoid the scam

Ultimately, there are marketing principles at play. You want to make sure that your campaigns are rooted in marketing and psychology to actually drive customers and clients to you.

If someone has a Facebook ads agency, and they pitch you a very specific funnel that they do for all of their clients, that’s where you might be in a bit more trouble. If you talk to a different Facebook ads agency, they might take a different approach by diving into your funnel and understanding the metrics and where conversions are happening or lacking. They should go deeper and offer some structural changes to improve that. Then, because they focus on Facebook ads they know how to set those up and get them cranking for optimal performance. Those two agencies generally have two completely different price points, client results, and mentalities.

Understanding your pace and the agency’s sales process

If you’re a business owner, you will understand this. Everyone’s time is valuable, meaning that every time you hop on a call with the agency and don’t buy, you’re costing them money.

Before you enter into a sales process, understand your timeline, and do as much due diligence before any calls so you are using the call to see if it’s a good fit from a culture and process perspective. Also, you will learn the agency’s timeline as well.

When I sell coaching services, for example, I set expectations with prospects at the beginning of the call that, at the end, I want to know whether they want to move forward or not. The reason is, that they get everything before the call to prepare themselves, and if they’re not sure about the process, or they’re too edgy on the price, they’re not a good fit. Also, 90% of prospects generally skip the follow-up/decision call after hearing the price. So ultimately, it’s not worth my time to fill my calendar with those. Ultimately, the fit just wasn’t the best – it’s no hard feelings at all.

Putting this in your perspective as the prospect though, you have to understand what you’re comfortable with before that call. You need to be prepared. If they want you to move forward on that call, but you know damn well that you have to wait until the following week, then that’s what’s best for you, and you need to stick to the plan that you laid out. A salesperson will be much happier if you are honest about your situation heading into the call, versus getting to the end when you say everything is perfect for you from a process perspective, but then you don’t sign on.

No one is right, and no one is wrong here, but sales is a numbers game. And as a prospect, you’re generally no more special than the next, and you shouldn’t expect an agency to trust you more than another prospect simply because you say so. And the reality is, the agency knows that at this point, you don’t fully trust them yet either unless you’re a blazing hot referral.

And I know someone is reading this and thinking, “But it takes x touchpoints to close a sale, and you need to have a strong follow-up game!” Yes, and no. Many of those touchpoints in the digital age come before a sales call even happens if the marketing process is done right. Also, if a prospect fails to do their due diligence before a call, they’re generally not serious enough to make a business decision.

Now this isn’t always the prospect’s fault, but you’re also never going to bat a thousand. Think about this within your own business as well. Don’t you want your customers and clients to be educated and know about your process and testimonials before talking to you? That leads to trust being built already. That leads to decisions being made on that call. That leads to honest and open conversations so your prospects can let you know some of their concerns, and you can guide them on the path to let them know whether this would be a good fit for them or not.

Determining your options

One thing I like to note at the top here, is if you’re shopping around, definitely be upfront with that. This is actually a disqualification for me if someone isn’t upfront about it. If they act serious and lead me down this path where I’m competing, it’s just not a place I like to operate, and why I work on building trust before we talk. I’m one guy. I don’t have 5 sales guys pounding the phones all day.

Do some agencies and marketers? Yes, absolutely. Why don’t I? Well, I like to have that trust built up beforehand. If you are upfront that you’re shopping around, I’ll walk you through our systems, but I want you to feel good about the process without me heckling you. Make sense?

Now, that’s not to tell you not to shop around. You have to do what’s best for you and your business. So yes, absolutely, do your research. Even if you’re 90% on one agency, schedule a call with a different agency first. You do that for a couple of reasons:

  1. You test out the steps laid out earlier in this post
  2. You can see how these discussions generally go, and you have a baseline going into your “ideal” conversation with the agency of your choice

Write down your quarterly business goals. Talk about this with the agency and see how they can help align their process and technique to align with yours. You might be surprised that your “favorite” option was a lot more smoke and mirrors than you thought.

Oh yeah, and don’t hire a “lead generation” agency. Are they all bad? No. But I would say well over 70% of them are built on taking other people’s courses and not in actual working knowledge of marketing and psychology.

Ask yourself, if you pay an agency retainer for 3 months, and assume at a minimum $3k adspend on top of that, and you get $0 back, will you be bankrupt, or was it worth it to see if it brought in the sales you projected for? Generally, it’s best to think you’ll spend, at a minimum, about 10k in your first 3 months. The first 3 months are the toughest, so you need to be prepared to lose that in most agency models.

Best of luck out there; it’s a cutthroat world.

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