Feb 3, 2022
Erik Jensen (Salt Lake City, UT),
Co-Owner and Chief Strategy Officer, Predictive ROI (La Crosse,
Erik Jensen is Co-Owner and Chief Strategy Officer at Predictive ROI, a remote-first firm that helps “agencies, coaches, and consultants plant their flags of authority and monetize that position.”
In this interview, Erik addresses the difficulties service businesses may encounter in developing a “position of thought leadership”:
When agencies try to be everything to everyone, their messages will be inconsistent and unfocused. True thought leaders do not have messages that lack clarity and strength.
Erik emphasizes that it is dangerous for an agency to assume it knows why a particular potential client approaches the agency for help. Customers may come because:
Saying “yes” to work that is not in your sweet spot often means the work will take more effort and fail to be profitable. That’s why, Erik says, it is important for agencies “niche down” to a well-defined target market . . . and to niche down fast.
There are a number of ways to find this “ideal” market . . . SWOT analysis, an addressable audience audit, an assessment of past client successes and profitability . . . but Erik recommends asking three questions:
If an agency serves multiple industries, Erik says, they’re like the legs of a stool . . . not stable and not comfortable. He provides a solution: “Find a common problem that all of those industries share that you’re really good at solving. That’s the top of the stool.”
Erik believes the case study question is pivotal in supporting agency success and that it facilitates agency growth by:
Erik also provides a detailed overview of how to effectively bring on a business partner.
Predictive ROI offers a free
book on niching down, leveraging authority into a monetization
stream, building great content, and clarifying purpose at
Erik can be found on LinkedIn, Facebook, and his agency’s website
at: predictiveroi.com. He invites people to join the agency’s free
weekly Q&A sessions, where 10 minutes of teaching are followed
by an open-forum business problem
ROB: Welcome to the Marketing Agency Leadership Podcast. I’m your host, Rob Kischuk, and I’m joined today by Erik Jensen, Co-Owner and Chief Strategy Officer at Predictive ROI, a remote-first firm – but he’s based in La Crosse, Wisconsin. Welcome to the podcast, Erik.
ERIK: Hey, Rob. Thanks for having me on the show. Actually, the agency is based in La Crosse. I am way over in Salt Lake City, Utah. So, we’ve got folks all over the place, which is actually kind of fun. For anybody that does or runs a remote company, you know what I’m talking about. For people that don’t, that maybe gives them heart palpitations. But it works well for our team.
ROB: That’s pretty great. I’m sure they would like to come visit you. We did a family road trip out to Salt Lake City and back in summer of 2020.
ERIK: There you go.
ROB: We had some fun. We saw the great outdoors as a family but spent the better part of a month on the other side over in Midway.
ERIK: Oh, fantastic.
ROB: Love the area.
ERIK: Yeah, there’s some really cool things. I’m actually a native of Minnesota, so I’m a Minnesota boy, and I spent a lot of time living in Wisconsin as well, where I met my business partner, Steven. But yeah, it’s been awesome moving out this direction and seeing all of the amazing things. It’s just crazy. There’s state and national parks everywhere. You throw a rock and you hit one.
ROB: Yeah. But there’s no humidity to be found.
ERIK: No, which is amazing again. I think I still brag about the fact that there are no mosquitoes here to all of my friends and family that still live back in the Midwest.
ROB: [laughs] You’re not making any friends there, but we’ll make some friends real soon. Erik, when you think about Predictive ROI, how would you hone in on the superpower of the firm? Where’s the strength of the business?
ERIK: We help agencies, coaches, and consultants plant their flags of authority and monetize that position. That’s what we do.
ROB: Dig into that a little bit. Tell us some more.
ERIK: What happens most of the time when someone attempts to go through that process of developing a position of thought leadership, they have really poor processes in place. Everything takes a lot more effort, a lot more time, and a lot more energy. They struggle sometimes with the cobbler’s kids, so they don’t actually do their own stuff. They don’t treat themselves as a client in a lot of ways. And for many of them, they don’t really understand what it means to plant their flag. They kind of throw spaghetti at the wall and hope that something sticks, and what ends up happening is they try to be everything to everybody, which leads to a really inconsistent message, and not a great way to be seen as a thought leader or to hold that position.
ROB: You’ve certainly planted your flag, so that’s a good starting point. That’s the opposite of the cobbler’s children. That’s good.
ERIK: This is true. We put a lot of effort into our own stuff or try to – although I’m not going to say we don’t struggle with that too, just like everybody else.
ROB: That’s right. Sometimes you do need that voice outside of yourself to really help discover that journey. Help crystallize this picture for us, apart from yourself, apart from Predictive ROI; what does this look like? Maybe there’s a good example of a firm that you’ve worked with, what they found their authority was, and what it looks like to project that out into the market.
ERIK: I’m going to use Agency Management Institute as an example because that’s a pertinent example for anybody within the agency space. Agency Management Institute is run by a fellow named Drew McLellan. Drew has done a phenomenal job of staking his claim within that agency space to be a guide, to be helpful.
His stance, his flag, is that most agency owners are accidental business owners. They were really good practitioners; they eventually got asked to do some work, and they’re like, “Yeah, I could do that.” And then they got asked a little bit more because they did a really good job, because they’re good at what they do, and before long they go, “You know what? I can totally do this. I can run my own agency.” So, they put out a shingle, and they don’t realize that being a practitioner and being a business owner is different.
ROB: Sure, and there are plenty of scaling hazards along that way. But along with that, I think, coming from an individual practitioner perspective, you know that people ask you to do something; you don’t always know why. Often, it’s because they know you and they know what you do, and they know what they want out of that. How do you start to turn the ship and help someone who just stumbled into this business to realize – I think there’s an element of why the customer is coming to you that is necessary to figure out where to find more of them. How do you start to flip that conversation?
ERIK: Customers can come to you for a variety of reasons, and it’s dangerous to make assumptions about why they’re there. A customer might come to you because they know you, and they don’t really know the problem they’re dealing with. So, you’re a safe place to be able to talk to them and guide them on where they may need some help or some advice or some work done.
The other possibility is that you’re getting them from referral sources because you’ve done a really good job. Again, depending on if you’ve actually planted your flag or niched down, the story that’s being told might be vastly different.
For instance, we get asked all the time, “Hey, do you know somebody that does this?” Yeah, we do. But we only recommend people that have been really clear that that is the problem they solve. But oftentimes people will get recommended just in the general sense of, “Oh, you’re struggling with that? I work with this marketing agency and they might do something like that. How about I introduce you?” What we’ve done is made it so that our referrals are uncertain about what we do, so they might be sending us bad fits, and they may not realize it. They may think they’re doing us a favor.
The other option is that someone comes into our ecosystem because of our own marketing efforts or because they’ve heard of us somehow through sales efforts, etc., and they have a problem and they want someone to solve it, and they’ve got nothing better to do than to ask. Why would they not ask? The challenge comes in when we say yes to all of those things. When we say yes to all of those things, we’ve made the decision to take on work that is likely not our sweet spot. We’ve decided to take on work that is probably not going to be profitable, and we’ve decided to take on work that is going to take more effort than if we were to stay in our sweet spot.
ROB: What does the journey look like? Sometimes we intuitively know our sweet spot, and if somebody says it back to us eventually, it’ll sound right. But sometimes we don’t know how to say it. How do you help people uncover what they should tell someone else their sweet spot is that’s actually going to make sense, going to fit, going to be the right engagement, going to be profitable, going to be the business that they can actually build and scale?
ERIK: There’s a lot of different ways to go about this. There’s one that I prefer. When it comes to finding a niche or a target market, there are lots of folks who will do a SWOT analysis. They’re going to do an addressable audience audit. They’re going to go and look at past clients and see what it is they’ve done really well. They’re going to see which clients are profitable and all that. I love those. Those are great opportunities to be able to educate yourself.
The problem I see most often is that at the end of getting all that information gathered, someone is still sitting there going, “I could go 18 different directions. I could still serve all these different audiences in all these different ways with all these different pain points.” Yes, you should do that information gathering, but I would recommend asking a couple of questions instead.
Number one is: What’s your superpower? What are you really good at? What do you love to do? Number two is: Who do you love to do that work for, that you actually care about doing that work for? That’s your “why” in many instances. I was going to use a more adult term for how to look at it, but I want to make sure that this remains friendly for everybody. [laughs] Anyway, I would approach: What am I really awesome at? Who, and why do I care about serving that particular audience?
Then the third question which I think is really important is: Am I going to be able to make a great case study off of that client? If the answer is no, then you’re probably not going to be doing great work and you’re not going to be able to leverage that work into future work. It should act as a really great filter of “Can I make a case study from this client?” If you can do that, for most people, that clarifies a lot of where their niche and where their flag needs to be.
There are some other analogies which I can also recommend. One is if you serve multiple industries, each one of those industries is like the leg of a stool. But it doesn’t have a top, so sitting on that stool is going to be pretty uncomfortable. Really what you have is a series of sticks. What you want to do if you serve multiple industries is find a common problem that all of those industries share that you’re really good at solving. That’s the top of the stool. That’s what you actually sit on. If you have one and not the other, it doesn’t really serve you to be able to narrow down who it is you’re serving and how it is that you’re serving them.
ROB: That case study question – is that more important simply as a mirror that you hold up and look at? Or do you have a held belief that case studies are a key part of growth? I think that would be my question off of that.
ERIK: I do think case studies have a really interesting position in an agency’s growth. One, they put a filter on your biz dev efforts at the very beginning so that you’re not saying yes to everybody. Because if you don’t believe that you can do great work for them, you’re not going to take them on. That already changes most agencies in a pretty significant way.
The second piece is it forces you to be documenting your work in a meaningful way to be able to tell a story. That’s useful both externally, which I’ll get to in the third point, but it’s also really useful when you’re talking to your client to be able to say, “This is the work that we did; here is the evidence for that work.” Which is, again, uncommon for a lot of agencies to want to have that conversation, that are excited about having that conversation because they’re prepared for that conversation.
The third piece is, what better way to be able to present the sort of things that you do than to be able to use social proof from others to say, “We’re great, and we don’t have to say it about ourselves. Here’s what other people say about us.”
ROB: That definitely makes sense. Erik, if we rewind the clock a little bit, how did you get here? How did you end up being the co-owner of Predictive ROI? What led you into the business? What led it to grow? What’s the journey here?
ERIK: I had an unusual upbringing. I won’t dive into all of that stuff, but I was fortunate enough to be around a lot of business owners throughout most of my life. My family own their own business; my brother and I started our own businesses fairly young. We had several of those. I was really fortunate to run across excellent mentors at the right time in my life, and I had the tremendous fortune in finding the right business partner. For anybody that has worked alongside a business partner, it’s a really important relationship to get right. If you don’t get it right, I cannot imagine how much stress and frustration that would cause on a daily basis.
So, I was really lucky. I actually met my business partner, Steven – I was going to school at the University of Wisconsin–La Crosse; he was working in small business development at the time, helping with businesses and their business plans. I had a question about a business plan that a friend and I were doing through Duke University, and he helped me do that. But he did it in a way that really impressed me. He actually sat me down with potential investors. He tapped his relationships in order to be able to say, “Hey, here’s a student who really needs help. I’d like to get him in front of the right people to be able to give him the right feedback.”
From that day forward, I was really impressed with what I saw from him, as far as his ability to step above and beyond for those who he was helping. And he was apparently impressed with the way that I handled everything as well. He likes to tell this story; he went back and later talked to his wife that day and said, “I don’t know when, I don’t know how, but Erik and I are going to do something together.”
Fast forward a couple years, and he had just started to get Predictive off the ground. He gave me a call and he asked me if I wanted to be a part of it. He and I had some good conversations. I specifically asked him to start off as an intern within the agency and to grow with it, and we developed a five-year path for me moving forward that led to ownership, and the metrics that I needed to hit, and the criteria and the milestones that needed to be met. So that was the journey. It’s been closing on 12 years now.
ROB: Wow. That’s a lot of trust to put in someone else, to say you’re going to start it together, but to start from a position of non-ownership and have to earn it. I guess you’d had a chance to get to know him a little bit, because if you didn’t know somebody, there’s a lot of ways to get messed over that way.
ERIK: Yeah. I wouldn’t suggest that it’s the only path forward for people to consider. [laughs] But I do think for anybody that currently owns a company and is looking to bring on someone to step into an ownership position, that’s risky on their part too. So there has to be skin in the game on both sides, and depending on how you want to structure that – it’s completely up to you. There’s great advice on that from a lot of folks. I wouldn’t consider myself to be the best person to ask about that.
But I would say there is a critical factor in that both parties need to have skin in the game on it. If they don’t, it’s easy to go, “I want to be an owner!” and not really understand what that means, not really understand the impact. There’s been times when Steven and I have made the decision not to pay ourselves and make sure the team gets paid.
ROB: That’s part of the owner’s job. That’s not the attractive part of it.
ERIK: But if you have someone that doesn’t understand that and hasn’t been part of the agency in a meaningful way long enough to know that that is part of owning it, when that decision comes, they’re going to rebel against that pretty hard.
ROB: Yeah, they’re not going to be thinking like an owner in that moment. It is very notable. I’m sure that Steven had plenty of choices of people he could have – he was seeing a lot of people in their businesses, so it’s a very special position that you hold.
You also highlight it’s an interesting thing about services businesses apart from others, where you have this progressive path to ownership. You have your startup world where there’s vesting of equity over time, it caps – it’s very different from the way that people can grow into a partner role. Do you have any insight? What is it that’s special about services – even law firms, consulting firms? What changes in that world that makes it make sense to tip over and grant partnership? Because that’s not always the case in let’s say an air conditioning firm that scales or something like that.
ERIK: Yeah, absolutely. Anything to do with the service industry is all about relationships. Now, that’s true to a certain extent in all businesses, but more so. When we think about agencies, agencies live and die on their relationships, whether that is the relationships they have with their team, the relationships they have with vendors and partners to be able to provide certain products or services, the relationships they have with their referral sources or the ponds they fish in as far as where they get their business, or the relationships they have with their current clients.
In order to be able to tell the difference, we have a couple of factors that we consider. We’ve talked about this pretty extensively, just because of obviously the journey towards ownership for me years ago, and obviously the journey since, because we do get asked about what that looks like from other agency owners who are considering that path.
One thing is you absolutely have to treat the person as an owner from the very beginning. They may not have the opportunity to leverage all of that power, but they need to be treated as an owner from the beginning. That includes things like transparency about finances. That includes how to have difficult conversations. That includes being there when strategic decisions are being made, etc. I think a lot of people shy away from that and they want to hide so much of the business from a potential partner for a really, really long time. Then all of a sudden they’re like, “And boom, now you’re an owner! Look in the closet, here’s all the other scary things you never knew about.” That’s not a great way to set someone up for success. So, I think that’s one thing to keep in mind.
A second thing to keep in mind is that when we think about bringing someone on for a partner, we need to really make sure that the values are in line with who we are. Eventually someone is going to be making decisions for the team, for your clients, for your products, for your services, and your job as an owner is to multiply yourself as best as you can. But it’s not just multiplying of tasks. You’re moving up in tasks; you’re not trying to multiply those tasks. You’re trying to hand off other tasks, but you want those tasks to be done in a meaningful way that aligns with how you want the business to be conducted. So doing values checks along the way – hugely, hugely important, and making sure that everyone is in alignment on that.
ROB: Right. Those values, much like the value proposition of the firm, it’s far preferable to drive those from authenticity rather than something aspirational. You talked about looking for a market position and expertise, but really, I think quite often people have something far better within them. It’s about finding it.
ERIK: Yeah. Another thing that I think is useful for that is – we’re big proponents of five-year career paths. When someone comes on, we develop five-year career paths with them so that they know what the journey looks like. There’s nothing more frustrating for an ‘A’ player in an organization than not knowing what moving forward looks like. That’s a good way for agencies to lose their ‘A’ players.
Finally, we have different levels of decision-making. We actually structure the decision-making process. We have Level 1, Level 2, and Level 3 decisions. Level 1 is “I’ve made the decision. I’m letting you all know.” Level 2 is “I want input, but I will be making the decision ultimately,” and Level 3 is “This is a group decision.” Starting off the conversations with the right tone and saying, “Hey, I want to let you know this is a Level 1,” or “This is a Level 2,” or “This is going to be a Level 3 decision” sets the tone for what others should expect from an outcome. That can help prevent a lot of frustration, too, if they’re really invested in that outcome. If this is a Level 1 decision, they don’t emotionally invest that same way. They go, “Okay, good. Level 1 decision. It’s been made. I just need to be able to take it in.”
ROB: Yeah, versus someone thinking that it’s a group decision and it’s an owner decision, and just the loss of morale, the loss of investment, a little bit of loss of trust. Certainly challenging. Sounds like some good lessons there.
When you reflect on the Predictive ROI journey, what are some other key learning points / lessons you have that you would extract from the business and that you still think about, maybe?
ERIK: You got like six hours? Because we could go a long time. [laughs] I think if there was one overarching lesson that I would really recommend or that we keep front and center all the time, it’s niche faster and deeper. That’s it. The faster and the deeper you niche, it makes every other decision in the company easier. No better way to put it.
ROB: There’s a clarity and consistency to your message. One of the things that you shared when we were scheduling this was about a book that might be interesting to our audience. Talk about that. I think it’s very aligned with what we’ve been talking about.
ERIK: I appreciate you bringing that up. For us, one of the things we talk about is peanut butter & jelly relationships. It’s this idea that you’ve got to have the right relationships and keep your audience at the center. Business is hard. It requires a lot of sacrifice for those who go down this path. The right relationships, teachers, and resources make a world of difference. If it’s you against the world, that really sucks. [laughs] It isn’t even against the world. You just have to look for those who will help without strings attached.
When you were talking about the book, we talk about authority positioning, we talk about niching down, and we talk about all of this coming from a position of being helpful. We try to demonstrate that concept in a concrete way with our audience to teach what we mean. We’re happy to do that with yours, too. Anybody who wants a copy of our book, it’s Sell With Authority. Free of change, you can get one. There’s no weird shipping costs, there’s no quick pitch when you get it. It’s just a free paperback copy of the book. And we mean it. We actually spent hundreds of dollars recently to get a copy to a participant in our free weekly Q&As because that participant lives in South Africa. That’s a whole other story. [laughs]
But if you’re on this journey to being an authority, we truly want you to succeed because the world needs more meaningful content and thought leadership and a whole lot less noise. So, for anybody that does want that, that’s at predictiveroi.com/free-book. Pretty simple. Happy to send it to anybody that wants it. If you’re struggling with niching down, if you’re struggling with how to really leverage authority and turn it into a monetization stream, if you’re struggling with your content, feeling like “I know we’re supposed to do it but I don’t know why” – it dives into all of that, and we reference it all the time. It’s pretty good use.
ROB: That’s excellent. I love the no strings attached part. We will get that into the show notes for sure. I think there’s probably an inception layer here. Is a book a way that you would, for many clients, potentially recommend establishing that authority and that positioning? That seems like it’s one of the tools in the toolkit for sure. What are some of the core pillars?
ERIK: A book is what we would consider to be a tactic. It’s definitely not a strategy. When we think about authority positioning, there are a couple things to keep in mind: your expertise, your point of view, and why you care. We talked about that a little bit earlier. All of that drives into this idea of niching down and planting your flag.
From there, what we recommend is coming up with a core promise, like “We promise to do this. As a company, we promise to give you a return on investment.” That’s our core promise. If somebody’s working with us, that’s our core promise. Everything that we do is driven by that core promise. Then we look at the three levers that have to be pulled time and time again for someone to be able to achieve that core promise. Those are the strategies that you’re aiming for from a content standpoint. Everything needs to lead up into those three things.
For us, we know that you’ve got to grow your audience, you’ve got to nurture your leads, and you have to be able to sell. If you’ve got those three things down, you’re going to be running a really nice profitable business. If you forget any of those, you’re not going to be running a business. [laughs] So we dive into those a little bit more.
But when it comes to how to do some of this, a book is generally the product of having done a lot of that work already. Rob, let’s put yourself in this position. If you wanted to, you could take all of the interviews that you’ve done, you could find a common theme because you’re controlling the theme of these podcast interviews, because you had a clear goal in mind of what this podcast was going to deliver.
This podcast is what we consider to be cornerstone content. It is regular; it is meaty enough to be sliced and diced; and it’s not a one-trick pony, meaning if you wanted to – let’s say iTunes closed down, no more podcasts. It’s still on Spotify, it’s still on Libsyn, all those other places. So, you could take your cornerstone content, which you had a strategy behind in order to create, you had a goal with it – what would it look like if you took 30 of those interviews and turned them into a book? By the way, somebody literally just did that.
ROB: Yeah, our writer for our episode summaries regularly campaigns to do this very thing.
ERIK: In fact, one of our books, Profitable Podcasting, half of it was written from podcast interviews and episodes. We wrote half a book without having to write half a book. That’s the difference between when we think about the content that we put forward in order to help us plant a flag. Every time you put forward a piece of content, whether that is social media, email, blog post, book, podcast episode, video series, research series, case study, eBook, streaming – the list goes on and on and on. Every time you do that, you’re taking a hammer and you’re either pounding that flag deeper into the dirt of where you are, or you’re flailing that hammer around somewhere in the air.
It’s your choice on how much of your effort you want to waste and how much of your effort you want to put towards your position of authority.
ROB: There’s a lot to think about there. That’s good. Erik, thank you for that. Thank you for the book link. Again, that’ll be in the notes. When people want to find and connect with you, Erik, and with Predictive ROI, where should they go to find you?
ERIK: You can obviously connect with us through all the usual social media suspects, like LinkedIn and Facebook. Honestly, though, if you actually want to get to know us, go to our website, predictiveroi.com, and join our free weekly Q&A. Literally, it’s a group of awesome people and business owners that get together; we do 10 minutes of teaching, and then it opens the floor, everybody asks questions about whatever they need to, to solve business problems. Again, our audience is agency coaches and consultants, so you’re going to be surrounded by agencies, coaches, and consultants. I really like that because it’s a great low-key way to get to know who people are without any sort of commitment or anything along those lines. And it’s a cool way to learn something at the same time. So that’s what I’d recommend.
ROB: We find the weekly thing through your website, sign up, show up, open Q&A.
ROB: Excellent. Thank you, Erik, for coming on the podcast and sharing your expertise and where you have planted your flag. We are very grateful for it.
ERIK: Absolutely. Hopefully, this was helpful. Rob, if there’s anything else that I can provide afterwards, just let me know. If anybody’s got any questions, happy to help. This was fun.
ROB: Much appreciated. Thank you. Take care.
ERIK: You too.
ROB: Thank you for listening.
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