You Must Adapt or Die

You Must Adapt or Die

Tim Fitzpatrick
Welcome to the Rialto Marketing podcast. Today's episode is a Revenue Accleration Series interview where we talk to seven-figure B2B professional service form owners and their growth-focused executives who are actively trying to grow their business and get to the next level. We talk about the good, the bad, and the ugly so that you can learn from their experience. Hi, I am Tim Fitzpatrick with Rialto Marketing, where we believe marketing shouldn't be difficult. Thank you so much for taking the time to tune in. I am super excited to have Kevin Flanagan from BCS365 with me today. Kevin, welcome. Thanks for being here.

Kevin Flanagan
Thank you for having me.

Tim Fitzpatrick
Yeah, I'm excited to dig into this with you today. Before we jump into it, I want to ask you a few rapid fire questions if you're ready to jump in with both feet.

Kevin Flanagan
Sure.

Tim Fitzpatrick
Okay. So very quickly, what do you do? How long have you been doing it?

Kevin Flanagan
So Director of Sales and Marketing for BCS365 really function as CRO. I've been with BCS for just over six years now.

Tim Fitzpatrick
What's the most important lesson you've learned along the way?

Kevin Flanagan
Adapt or die. Just because it worked yesterday doesn't mean it's going to work tomorrow.

Tim Fitzpatrick
That is so true. We can never get too comfortable, right?

Kevin Flanagan
No, you see it all the time in business. Graveyards clotted with companies that couldn't adapt.

Tim Fitzpatrick
Yeah. So we know, look, marketing, sales, revenue operations, all of that stuff. It's not easy, right? It's hard work. Do you have any mantra or motivational saying you say to yourself or share with your team to push through those challenging times?

Kevin Flanagan
Yeah, it It might sound corny, right? But it's never as good as it seems. It's never as bad as it seems. You're going to have the highest of highs and the lowest of lows. You're never going to have everything work in your favor. So you just try to ride out the lows and wait for the next wave to come along.

Tim Fitzpatrick
Yeah. I love that, man. That actually is one of my favorite quotes, Nothing's as good or as bad as it seems. So it's just a reminder to try and stay even keel, right?

Kevin Flanagan
Yeah, exactly. I learned it a long time ago. Someone told me once on the golf course, and I thought to myself, wow, that really applies to a lot of things outside of golf.

Tim Fitzpatrick
All aspects of life. All aspects.

Kevin Flanagan
Exactly.

The Biggest Challenges in Partnerships

Tim Fitzpatrick
So when we connected for the pre-interview, I know you had mentioned that you had worked with multiple outsourced appointment setting services without a ton of success. What do you feel were the biggest challenges you faced in these partnerships? And what did you learn from the experience Because by the way, you are not the first person that I have talked to that has said the same thing.

Kevin Flanagan
Well, I'll take comfort knowing that I'm not the first. There's hundreds of third-party services out there that claim to be best, claim to have solved and have the secret recipe for meeting setting. Unfortunately, what we found is they all want a flat rate. They all want their money paid to them up front. And in return, you get the promise of meetings. In the end, every single one of them fell well short of their delivery metric. Even though that metric was scaled, Hey, we're not promising anything in month one. We'll promise a handful in month two. But boy, by month three, we're going to be at that number and we're going to take off. Every time we got to month three and we took a step back, none of them were able to deliver. It really left us wondering, if you're so sure of your capabilities and you're so rock solid with your process, then why wouldn't you entertain a win-win model? Whereas I'll give you a dollar X for the meeting if it sits, and then I'll give you a dollar X times 10 if that meeting turns into business. And to me, that's a more shared model. And by trying to get people to accept that model, I'm mitigating my risk, right? Because I have all the risk in the promise of a meeting for upfront money.

Tim Fitzpatrick
Yeah. Yeah. You know, there's downsides to both, right? The downside to paying per meeting is, how much incentive is there to make sure that that's really a qualified lead? So it's a tough thing, and it's especially in the IT and the managed service provider space, I talked to very few people where it's worked well.

Kevin Flanagan
No, you are spot on. Selling services is entirely different than selling hardware or software or a commodity.

Tim Fitzpatrick
Well, and the other thing, too, I think that's challenging is a lot of direct outreach is really focused on finding that 10 % or less of the market that is open to or looking to buy right now rather than taking a longer term approach and connecting with people and then building a relationship from there. And that's a challenge, right? Because if only 10 % is looking or open to buy, you're trying to find that 10%, but then within that 10%, you need to find the people that are even willing to talk to you at that point. It's very challenging.

Kevin Flanagan
Yeah. Marketing understands that better than sales, right? Sales is more instant gratification. I put a coin in and I get something in return. They don't like playing the long game. By the long game, it could be eight months to a year. Like you said, if the need isn't there right now, it doesn't mean that someday it will not be. But you have to nurture, you have to educate and hope that when that day comes, you're still around and ready to be considered.

Tim Fitzpatrick
Yeah, because it's not the pain for your prospects needs to be incredibly high for them to switch because switching managed service providers, depending on the size of the company, is not necessarily the easiest thing in the world to do.

Kevin Flanagan
No, I agree. People in general are risk averse. You might look great, you might actually be better, but I just can't take the chance. Yeah.

Tim Fitzpatrick
Well, which really hammers home that point of why it's so important to stay in front of those people. Because the more they see you, the more they start to get familiar, the more they get comfortable with you. And when the problem becomes great enough, the comfort level is high enough where they're open to that, right? And you hit on it. I mean, they got to be comfortable. They have to feel safe. And if they don't feel that way, they're not going to make the decision to to change.

Strategies for Sourcing Leads and Managing Assigned Leads

Tim Fitzpatrick

Now, I know, Kevin, your sales team is responsible for sourcing their own leads and managing assigned leads. What strategies have worked best for your team in consistently generating and closing new business?

Kevin Flanagan
Yeah, I think first off, we've finally reached the point where we understand cold calling today just doesn't work. Post-covid, nobody's picking up the phone, or very few people are picking up the phone. And these days, our shift has been towards, it's more about a warm call. A targeted call. It's the only calling that works. Even then, by works, I mean, probably has a 4% or 5% hit rate, but cold calling has less than a half a % hit rate. For us, the thing that really has been working is all things network-related. Work your social network, work your business network, your personal network. Build a network of referral partners, people that you'll pay if they introduce you into a business. I'm not saying sell for me. I'm saying, introduce me to people that that trust you. Build a business partner network. We've expanded into the UK in the last five months, and we found our fastest channel to success over there is go find MSPs and propose to be a partner with them and provide a service or a few services that they don't have today. It's We're happy with that. I will take a piece of a dollar rather than no dollars at all.

Tim Fitzpatrick
Yeah, that's interesting. It sounds like most of your salespeople taking more of an account-based marketing approach, and then they're directly reaching out to potential referral partners.

Kevin Flanagan
Right. Is that accurate? Yeah. We've had a referral partner program for a number of years. As I said, we're not asking them to even attend the meeting. We're just, Hey, make a warm introduction and then get out of the way. If it turns into business, I'll pay you $2,000, $3,000 because you did that. We have referral partners that are referring four or five deals a quarter and getting paid for doing it. These aren't necessarily partners in our ecosystem. One of the ones that we have that's been very successful, he's a quality improvement consultant, whereas he'd go into a manufacturing facility and take the production from 500 steps to 50 steps using Lean Six Sigma and processes like that. Now, what does he have that I want, Tim? He has a Rolodex. He has a Rolodex of people that he's worked with that have trusted him. If he says, Hey, you should take a meeting with Kevin from BCS, they're more likely to do that. That's a path of a whole lot less resistance than just cold call.

Tim Fitzpatrick
The other thing with that particular example, too, is what he does is complementary to what you do. And so it's much easier for him to have that initial IT conversation, right? Because what you guys are doing on the IT side is supporting what he's trying to get done as well. And so it ties in really nicely. The thing that I'm curious about, Kevin, is did you guys notice a difference when you started incentivizing for referrals through referral partners, or does it work better with some than it does others? What have you observed there?

Kevin Flanagan
Before we started paying them for the lead, The Referral Partner Network was this verbal agreement that said, We'll interchange leads. You give me a lead, I'll give you a lead, and this will be a nice little relationship. But someone's always go, Five minutes after I leave, you're going to be back to work. You're going to forget about that. It's not as meaningful to your business. It's not in writing. There's no instant gratification there. Money is unfortunately, we live in a world where money is an instant gratifier. It's worked better than the early just, Hey, we're in a business network. We'll meet once a week and we'll just exchange. Oh, Hey, I know a guy. Oh, I know a guy. There's networks that are set up to do that, but more on the small business side. Every town has a network like that. It's made of landscapers and electricians and plumbers. I'm not saying it's bad. It works for them. But typically, that's I'm referring a homeowner to you, you're referring a homeowner back to me. As you move upstream to larger companies. That just doesn't seem to work as easy.

Tim Fitzpatrick
Yeah. Do you have a formal agreement that your referral partner sign?

Kevin Flanagan
Yeah, we do. I like to think it's non-threatening. It's one of the shorter agreements I have. I think it's a one-page document. It's non-binding. Either party can cancel it at any time with zero notice, but it just calls out, Hey, here's how you go about referring something over to me. If it closes, I owe you a check. Here's how the check is calculated. Here's when it's due. So it's very straightforward. We find that the clunkier those agreements get and the lengthier they get, it intimidates people, right? If it looks like a legal document, people shy away from it.

Tim Fitzpatrick
Yeah. Do you pay a percentage of offline revenue? What does that look like?

Kevin Flanagan
So in an effort to simplify it, in the past, up until this year, we used to tell them, Okay, we'll pay you X percentage of the first month's margin. Well, what is that? They want something they can quantify. So basically, we said, You know what? Let's keep this simple. If it's this size, you'll get $1,000. If it's mid-size, you'll get $2,000. If it's above that, we'll get $3,000. We'll give you the opportunity to negotiate on a huge opportunity.

Tim Fitzpatrick
Got it. Okay. Yeah. So you basically have windows, right? If the project is between this and this amount, then we're going to pay you a thousand bucks.

Kevin Flanagan
Correct.

Lead Gen Tactics that Have Proven Most Effective

Tim Fitzpatrick
Yeah. Got it. Okay. I love it. So you touched on this a little bit. You've tried cold outreach, email campaigns, You got referral partnerships. What lead gen tactics have proven most effective for you guys, and how have you adjusted your approach over time?

Kevin Flanagan
Yeah, I think the keyword there is tactics, plural. We have a lot of folks on the team that will get settled into one tactic and focus so hard on that that they neglect all the others. I'm always reminding the team, It's like a racing boat, a crew, right? Hey, there's 12 ores, and you have to be pulling on all 12 ores simultaneously, or else you're never going to get anywhere, right? If you're just sitting there and you're solely focused on your referral partners and you're not working any other avenues, don't be disappointed with the results, right? And as I said earlier, maybe you're throwing in some direct email campaigns and maybe some warm calling. But from time to time, you're going to hit that valley where those aren't working. Don't give up on it. That That's why you need multiple Ores. If I'm pulling on 12 Ores and three of them happen to be clicking this month, maybe two or three others might pay off two or three months down the road. It's hard with the sales team because, like I said, they have a short attention span. And if something's not working, they'll turn their back on it and they'll go focus someplace else. And then same thing if, Wow, I got I got two deals out of referral partners. I'm going to devote all my time to referral partners. Okay, well, don't be disappointed when that well runs dry.

Tim Fitzpatrick
Yeah. How do you stay on top of that with them to make sure that that's top of mind?

Kevin Flanagan
Yeah, shameless plug, right? So we're using HubSpot. We had been using Salesforce for the last three years. We're just not a big enough company to use Salesforce. And Salesforce is their CRM is great. No, it's so great on the marketing module, right? So we retreated back to HubSpot. We've added in a couple of analytical tools like lead forensics and a couple of others. And what we're getting now is huge volumes of analytical data that show us results on every single thing that we're doing across the board. And the other part about the salespeople is the easiest way to get them to try different things is have one of their counterparts tell a story about success using a social network or a business network or a personal network. They're very, not a bad word, but they are lemmings. If they perceive that somebody else is successful doing X, they're going to go do X.

Tim Fitzpatrick
How many salespeople do you have on the team?

Kevin Flanagan
When we're fully staffed, we have about a dozen. Currently, I think we got seven. So we've got a couple of job openings, if anyone's interested.

Tim Fitzpatrick
Yeah. Well, it's a decent-size sales team, nonetheless. So yeah, interesting.

Kevin Flanagan
Yeah, they're geographically scattered. And I think that's the other challenge, right, Tim, is just because something's working in the Northeast, don't assume that that same approach is going to in the Southeast, right? You need to understand the demographics and the way they do business.

Tim Fitzpatrick
Yeah. It's funny. There's a couple of things I want to pull out here. One is when you were talking about, Hey, we need to focus on multiple tactics, right? I talk about that all the time on the marketing side where it's like, if all your business is coming through referrals, you're riding a unicycle. If the tire goes flat, you're screwed. I like your boat analogy. I always just go back to vehicles and things like that where it's like, if you got multiple channels, will your You're riding a four wheeler, right? If one of those tires goes flat, you're still going to get there to the destination. It may take you a little bit longer, but you're going to get there. If the unicycle, you are not going to get there, which is so, so important. And the other thing, too, that I love that you talked about is how important it is sharing within the team those successes, right? Because oftentimes, we're not sure whether it's possible until we see somebody do it, right? The analogy that's coming to my head right now is the one about the four-minute mile. Nobody thought that it was possible. And then what was it? Once the first guy did it, the second guy did it within a month or something like that. I mean, it's crazy. I can't remember the exact numbers.

Kevin Flanagan
Yeah, no. And now you've got first year college students pushing a four minute mile. So yeah, you're right. People don't believe things can be done until they see it done. It's very much, hey, show me, prove to me.

How Your Marketing Strategy can Support Your Sales Team

Tim Fitzpatrick
Yeah, such a big deal. Now, I know, Kevin, you guys have increased your investment in content marketing and social media, but B2B sales cycles can be long, as we know. How does your marketing strategy support what the sales teams doing, helping them staying engaged with prospects over that life cycle?

Kevin Flanagan
Yeah. So we probably right now have a database of somewhere between 90 and 100,000 contacts that we are marketing to directly on I would say weekly basis. The approach is until they opt out or threaten to call the cops, we're going to keep on marketing to them. But we've segmented them into SMB and mid-enterprise because what we're doing is highly technical, like we talked about early on. It's services. You can't necessarily touch it and understand it. On the SMB side, quite often, we're not selling to a technical audience. Those campaigns, that outreach is business-focused, where if I'm talking to a company with 3,000 employees, okay, they have an IT staff, they have technical people. That can be more technical outreach in nature. But we try to avoid overcomplicating it on the SMB side. Now, those are smaller opportunities, but we find that they move much quicker through the funnel where an SMB opportunity, average sales cycle might be 6-8 weeks. Mid-enterprise, it could be 6-8 months or longer. So we need to be very clear on who's the audience that we're speaking to.

Tim Fitzpatrick
With mid-market, are you guys offering co-managed services? Is it project work that you're doing? What does that look like?

Kevin Flanagan
Yeah, here's one of our challenges, right, is we do all things IT. And when I put my hands here, I'd put them wider, but they'd be off the screen. All things IT, that's a broad spectrum, right? So how do you focus that, right? I don't know where the need is, so I need to be talking across a very broad spectrum and then hope, as you said earlier, that I hit a cord and there is a somewhat immediate need in one of those many, many, many segments. Let's say there's 20 different offers across all aspects of IT. That's the challenge. Our first, sometimes second calls are very much a discovery call. Look, I don't know enough about you, to be so bold to get on my first call, beat my chest, and tell you how great I am and how I can help you. I don't know if I can help you. I think I might. Based on 40 years in the industry, I think I can find an area of need, but I'm not going to jump on that first call and do a lot of talking. I'm going to do a lot of asking questions.

Tim Fitzpatrick
Yeah. Ask them questions and listen to what they have to say.

Kevin Flanagan
Yeah, for sure.

Tim Fitzpatrick
Kevin, you highlighted something that I think is really important and easy for people to overlook where you've got this list of contacts, but you've segmented based on different characteristics, but the message to each of those segments is different. And that's really, really important, right? Because if we don't segment, the message just becomes too broad. And when it's too broad, it just becomes irrelevant. Whereas because you've segmented, you can make that much more specific, not talk tech with that segment that's not technical. But the segment that is, you can get a lot more direct and pointed talking about the tech. And that's really, really important. And I think long term, that's going to make what you're doing much more effective. And it's just something that we can't forget. And look, you've segmented into two simple audiences. This doesn't have to be a super complex thing. We just need to start doing it.

Kevin Flanagan
Yeah, it takes a little longer and it seems like a duplication of effort. Well, why do I have to take a technical message and make it non-technical. But I'm not saying the non-technical message wouldn't work in mid-enterprise, but you'll have to be targeting a CFO or a CEO with that message. Because CFO, what do they care about? It's dollars. Does this make me money or does this save me money? That seems really vanilla, but that's the nature of their job. You might get them if you have a risk conversation because risk represents dollars as well. But you need to tie it back to dollars at the end of the day. So it's funny. A lot of it is persona-based. When we had an inside sales team, they were making a thousand calls a day. This was before COVID. And the burnout rate in that job is so high. And I told them, Pick a day and pick a persona. And all day long, focus on that persona because if they answer the phone, it's too late to mentally make that shift. Who was I calling? What's their title? Oh, I got to give them the CFO pitch. Oh, Jesus, CIO. It was easier for them to stay in character, stay focused. Mondays, it's CFOs. I have top of mind all the things that I want to say that are important that will resonate with that persona.

Tim Fitzpatrick
One of my mentors said specificity sells, and that always stuck with me. And it's much, much easier when you segment it like that where they're like, Okay, these are the specific people I'm talking to. Here's the pain points. Here's the outcomes they want, right? Here's what's important to them. The more specific we can get there, the higher likelihood it's going to resonate and you're going to capture their interest and attention. And without that segmentation, we don't have the ability to do that. You just can't.

Kevin Flanagan
Yeah, we're just too scattered. And you come off scattered.

The Evolving Role of Sales and Marketing in Cybersecurity

Tim Fitzpatrick
Yeah, I love that. So given the challenges of selling IT and cyber, how do you see the role of sales and marketing evolving in the industry? What changes are you preparing for?

Kevin Flanagan
Yeah, I think longer sales cycles because a big part of what we do up front is It's educating, especially cybersecurity. Cybersecurity is newly top of mind. Only in the last five or six years has it become so top of mind because we hear about it every day, not just in 8: 00 to 5: 00 in the business, you hear about it at home on the news. You experience it with the text messages and the email that you're getting into your personal devices and your personal emails. Everybody now is hyper-aware, but that industry is changing so fast. We joke sometimes. It's a game of Whac-A-Mole. Every time we think we've solved and beaten down a crisis here, a new crisis pops up someplace else. We spend a ton of time educating, doing webinars that people would go, Are you in sales? Because none of the 30 minutes was spent selling. No, I can't. Marketing, it's a journey, and we need to first educate them. Yeah, sure, we're creating some FUD in the process, but we need them to fully understand how critical cybersecurity is to the business and what happens without it. So stories resonate there. So we've been doing a lot of breakout sessions and events And over the last two years, 30 minutes. And it's just cybersecurity awareness. The last slide, I'll give you my name. I'll give you my contact information. I'll stand in the back of the room after this, and we can talk, but I'm not here to sell you. I'm here to educate you.

Conclusion

Tim Fitzpatrick
Yeah, I love that. So given the challenges of selling IT and cyber, how do you see the role of sales and marketing evolving in the industry? What changes are you preparing for?

Kevin Flanagan
Yeah, I think longer sales cycles because a big part of what we do up front is It's educating, especially cybersecurity. Cybersecurity is newly top of mind. Only in the last five or six years has it become so top of mind because we hear about it every day, not just in 8: 00 to 5: 00 in the business, you hear about it at home on the news. You experience it with the text messages and the email that you're getting into your personal devices and your personal emails. Everybody now is hyper-aware, but that industry is changing so fast. We joke sometimes. It's a game of Whac-A-Mole. Every time we think we've solved and beaten down a crisis here, a new crisis pops up someplace else. We spend a ton of time educating, doing webinars that people would go, Are you in sales? Because none of the 30 minutes was spent selling. No, I can't. Marketing, it's a journey, and we need to first educate them. Yeah, sure, we're creating some FUD in the process, but we need them to fully understand how critical cybersecurity is to the business and what happens without it. So stories resonate there. So we've been doing a lot of breakout sessions and events And over the last two years, 30 minutes. And it's just cybersecurity awareness. The last slide, I'll give you my name. I'll give you my contact information. I'll stand in the back of the room after this, and we can talk, but I'm not here to sell you. I'm here to educate you.

Tim Fitzpatrick
Yeah, that's awesome. So knowing what you know now, anything you would do differently?

Kevin Flanagan
We probably would have built out the business partner channel sooner, not the referral partner channel, but the business partner channel. Hey, let's team up. I have strengths, you have strengths, we both have weaknesses. Let's figure out how we can augment each other's offerings and pair up. There's a saying I love. I recently used it in the UK, and they all looked at me like, What are you talking about? But the saying is that pigs get fed and hogs get slaughtered. The idea Don't be a greedy pig. I'll take a piece of the pie. I don't need the whole pie. Hey, a new logo is a new logo. What we know is if we can get into a business with a partner doing just something in particular or any new business, I can go deeper and wider over time, but I have to first prove my value. I have to prove my value to the partner. I have to prove my value to the client. I think in the past, we've fallen into the trap. There's, again, another saying, land and expand. Well, yeah, we all bought into that, but we thought it meant all at once. It's like, Guys, no, no, no. It's land with helping provide value in a certain segment and then expand over time. Because people buy from... Again, analogy, people buy from people that they like. Yeah, they do, but they also have to trust you. So they'll buy from people that they like and trust. And trust is earned. You need to build it up over time. So let's not try to boil the ocean all at once. Let's be happy with one piece that we can do really, really well, provide value there, and then earn the trust to expand from that.

Tim Fitzpatrick
Yeah, I love it, man. So, Kevin, thank you for taking the time. Where can people learn more about you if they want to connect?

Kevin Flanagan
Yeah, so I'm active, very active on LinkedIn. BCS is even more active than that. And again, it's a great place. If you follow us on LinkedIn, you're going to get a free education on a number of things. And then they could always email me directly, kflanagan@bcs365.com. So yeah, happy to have, like I said at the top of the call. No bad conversations. Happy to talk to anybody.

Tim Fitzpatrick
Cool. We will make sure that both those links are in the show notes, but it's bcs365.com. And then, unfortunately, there's other Kevin Flanagan. So your LinkedIn URL is not quite as easy, but we'll make sure that that gets in the show notes so you guys can connect with Kevin directly. I really appreciate you taking the time. It's been a great conversation and appreciate sharing your experience and what you've learned along the way.

Kevin Flanagan
Yeah, I've enjoyed it.

Tim Fitzpatrick
Yeah, awesome. Those of you that are watching, listening, appreciate you as well. You can connect with us over rialtomarketing.com. That's RIALTOMARKETING.com. The other tool we've got for you is over at revenueroadblockscorecard.com. When we help clients build their marketing engine, we focus on nine key areas. If you want to know which of the nine are slowing down your growth, that's where you can do it. Super fast, less than five minutes, customized report. So go check it out, revenueroadblockscorecard.com. Thanks so much. Until next time. Take care.