With all the tools and software available, marketers have more data than ever about their prospects and customers. They’re drowning in it.

The trick, says John Durham of Catalyst, is wading into that data, finding out what works, and turning it into action that gets real results.

That means figuring out why people buy – and who they are. Marketing 101, right? But John says not all clients get what it takes to do that. We talk about that, as well as…

  • The low-cost, high-quality alternative to Salesforce for startups
  • How to identify – and get rid of – bad clients
  • The first person you must hire as a one-person startup
  • The advantages of a project-based business model
  • And more

Listen now…

Mentioned in This Episode: CatalystSF.com

 

Episode Transcript:

Steffen Horst: Welcome to the Performance Delivered, Insider Secrets for Digital Marketing Success Podcast. Where we talk with marketing and agencies’ executives, and learn about how they build successful businesses and their personal brand. I’m your host, Steffen Horst.

Today, I’m happy to welcome John Durham as my guest. John is the CEO of Catalyst SF, a brand strategy firm that provides strategic marketing services rooted in media for startups and brands. In addition, he is the co-founder of Republic Project, and since 1992, passes on his vast marketing and sales knowledge to students at University of San Francisco. John, great to have you on the show.

John Durham: And thank you, Steffen, very glad to be here.

Steffen Horst: John, I think where we’d love to start off is to find out how did you end up in marketing and sales?

John Durham: Well, it’s really interesting. I started out undergrad in Washington, and I wanted to be in foreign service. In my Sophomore year, I took a class in political advertising, and this teacher changed my life, and I decided I wanted to be in marketing and advertising. So, my undergrad and masters are in Political Marketing. I get out of grad school and go to work for Coca-Cola. And so, I’ve done it ever since grad school. I’ve been in the agency side, publishing side, and the brand side.

Steffen Horst: That’s very interesting. Was there something particular with that professor that kind of, made you move toward the advertising side? Something he said, or?

John Durham: She said it’s the business marketers’ job is to get people to buy something, and there’s nothing better than the election, because either they win or they lose. And you just learn to create marketing and messaging that drives people to do something, and that lesson stayed with me. And I was just intrigued because she talked about campaigns and had some people in about how they were using insights and data even before it became fashionable to do that.

Insights and Data in Marketing Campaigns

Steffen Horst: You mentioned insights and data. Do you think, these days, that agencies have figured out how to use data and insights to create better campaigns and strategies for their clients?

John Durham: I think that they do. I think that they do, if not, they have no choice. I mean, you know, talk to a lot of CMO’s, and they’re just saying, we don’t need thousands of points of light. We just need four or five insights we can actually act upon during the year, and if we got that, that would be gold. You know, I think we are drowning in data, and I think agencies that are worth their weight are really finding those nuggets, and those insights, and in doing so, they deliver tremendous worth. Not only to themselves, but value to their client.

Steffen Horst: That’s really interesting. Obviously, agencies, from my perspective, are a little bit pushed to using data these days because, you know, how do you make decisions? But from a brand perspective, when I read what brands do these days, I still feel they still lack a lot in  using the data they already collect, segmenting them, and getting the right information out. Do you think it’s more bigger companies, or enterprises, are doing a better job than smaller companies? Or is it the other way around?

John Durham: I don’t think anybody is doing a great job. They hide it really well because they don’t want anybody to know about it. I think there’s some that are doing a really good job, and there are some that are doing an average job. The problem is, they’re trying, everybody is trying to be cute. Too cute. What brands need, they need to do stuff, they need to sell things, they need to do something along the journey continuum. And they just need those one or two insights that are going to help them fashion a creative, fashion a media plan, fashion that customer to do something.

It’s not rocket science. I think we’re making it hard. I think we make it hard because people are trying to justify some of their existence. And I mean, the companies that are doing it really good, they’re under the radar and they’re just delivering those five or six meaningful insights and bringing them to life in all forms of media and messaging.

“I think we are drowning in data…

and I think agencies that are worth their weight are really finding those nuggets, and those insights”

Steffen Horst: Would it be right to say that one of the big challenges for agencies is using using data correctly? In the best way?

John Durham: Yes. And having people who are trained in how to take data to knowledge. That’s the most valuable insight. Most people can take data and play with it, but how do you take data into actionable knowledge, to do something? That’s the winner.

Steffen Horst: I have to chuckle when you say that because I quite often have conversations with our team here, to talking to clients about the monthly report. You know, and it’s like, don’t write down impressions increased by X, or CPC increased by this. They can read that out of a reporting sheet, but what does it mean? Why is it? Have they a better messaging, and if so, what are we recommending, as a company, as a marketing service provider, to the client to do in order to overcome the challenge that messaging might create?

John Durham: Well, you create a massive point of differentiation when you do that. Because that will separate you, because most people are doing you know, like, clicks to conversions, and they’re doing this data reporting. Data reporting is easy, you can read that on a spreadsheet.

Steffen Horst: Yeah.

John Durham: If a brand manager, a project manager, a CMO, or a CFO, is ever looking at it, okay, what does this mean? What can we do with it? How is this, knowing that we’ve got a bunch of twenty-five to thirty-four year olds that are converting, they’re actually going to the conversion page, but they leave, wonder why that is? You need to look at that.

That is stuff you just need to pick up and you need to drive. But again, that separates you because you’re delivering smarts, and people want knowledge to help them make intelligent buying decisions.

Steffen Horst: Yep. I couldn’t agree more on that statement. So, as we wanted to talk today about, someone found out, you found an agency, how are you becoming successful? Whatever someone defines as successful, whether they say, you know what, I can have a certain salary that satisfies my needs, or I want to build out a hundred persons agency. I mean, there are many things in-between those two scenarios that people might strive for. But, what you just said I think is really important, that this going the extra mile, and actually providing the service beyond just the obvious, that would be the first thing to be successful.

John Durham: I agree. And I think in 2019, if you’re approaching that last mile and working backwards, you will be ahead of the pack. I think we get so caught up in process that we forget that, you know, we’re still a bunch of women and men tasked with getting people to do stuff. And you know, we have all this intelligence and insights, and we get to, you know, play art and science and get people to do stuff. And I think that’s fun. That’s why I think of the last mile, and I think, you’re building an agency today, you’re really driven to get solutions for the customer.

Marketing Tools to Use

Steffen Horst: Makes sense. We all collect data, but obviously one key is to slice and dice the data to be able to come up with the smart suggestions for the client. From your perspective, are there certain tools that agencies should use in order to make it easier on them?

John Durham: You know, obviously, having the person on board who knows how to look at those blocks, that hey, wow, look at this insight. And then, you know, hey look what I’ve found, what does everybody thing? Gut check it. I think there’s a lot of great companies out there that are providing tools, I don’t think there’s a one-answer company. I think Salesforce probably does some things.

Several companies come to mind, but there’s nobody that just grabs at me, that just like, wow, this company does it all, and does it right.

Steffen Horst: Would you say, I mean, with a normal, I don’t promote this product, obviously, but with a normal Google Analytics set up, with proper dashboards created, you know, event tracking, goal tracking in place. I mean, that could be the first step to get a handle of all the data, right? And get an easy overview of things.

John Durham: Yes. Yes.

Steffen Horst: It’s almost like a prerequisite.

John Durham: Yes. I really like that.

Steffen Horst: If you don’t want to go to Salesforce, which obviously, is a really expensive platform, right, and as a small agency or a one-person agency, you might not be able to afford to buy a Salesforce license. Having at least Google Analytics in place for your clients, and making sure that’s properly set up, that it connects the data.

John Durham: Google Analytics is a great tool.

Steffen Horst: Yeah.

John Durham: I mean, I think it’s a great first step. I think it’s a good education, it’s a good gut check. And I can’t imagine, honestly, anybody not having Google Analytics.

Steffen Horst: I mean, you know, we both run agencies. I have a good number of clients, or had a number of clients, that had Google Analytics tags in place, but they were obviously not properly set up. And then, you don’t collect the right data, or don’t collect complete data, which in itself creates a problem, because then even if you would go in and use that data, it clearly is giving you a complete incorrect picture. But you know. So, only having the system-

John Durham: I think you bring out, I think that’s actually an interesting point, is the efficacy of the data. This is where I think the power of the agency really comes through. Because the agency is going to be that neutral observer to really look at things from an unvarnished point of view, versus somebody internally. And why I think it’s important that people, I mean companies have people internally, this is where I think agencies can deliver real value. Because if they’re bringing that unvarnished individual, that, to me, is a real powerful business. I mean, I just think it’s a real strong business.

Steffen Horst: From your perspective, how would you go out and sell that, then, to a client? Because they will come to you and say, well, you know, we don’t need someone who provides us data insights because we have this data person in-house, and that person tells us everything we know. How do you respond to that?

John Durham: I think that, you know, and they do. And I argue then, you have an agency, an external agency that you use to present creative, and you use to present media, and that, at the same time, you take advantage of all their services. It doesn’t mean that you don’t utilize all your in-house people, but you have people who are looking at the marketplace. They’re looking at a, God, I can’t really ever use this word, a very holistic view of a market, versus a very myopic view, and a frame of reference of the client. And I think sometimes, that objectivity can be very powerful, particularly in consumer brands.

Steffen Horst: Because that individual in-house might have an internal view, by looking at data points.

John Durham: Right. And they do, their lens is, no, I don’t think that they’re bad, by no means. But I think their lens is a bit guarded, or jaded, because they’re looking at it from the lens of the brand, and the agency is looking at it from the lens of the marketplace, and I think those two can be very powerful. So, to me, you’re trusting the agency for your creative, you’re trusting the agency for strategy and for media, you should do the same thing and trust them for data insights.

Steffen Horst: That’s a good point. We talked about data being kind of, this important thing in 2019. What other things can agencies do, or individuals do that want to build an agency, to set themselves apart from the players that already are in the market?

John Durham: Great question. I think it’s a great time to be in the agency business. I think everybody says oh, the agencies are dead. I mean, they said television is dead, radio is dead, newspapers are. Newspapers may be dead. But I think everything else is alive and kicking. I think the agency business is great, because what’s happening is agencies are inventing themselves to really carve out what they do well. We do brand strategy, you know, you do very actionable X. Some agencies focus only on creative and different articles and different categories. I think the world today is the art of the specialist, is even more powerful and more opportunistic. And from a brand perspective, you’ve got a such better menu to pick the right providers, because there’s so many people that are thinking, they’re just thinking smart and thinking right.

Steffen Horst: Okay. It kind of feels a little bit like that we would have come full circle, because I’ve been in digital marketing fourteen years, you obviously have been much longer, but I feel that when I started off, there was a lot about specialists. You know, you have a special search agency, you had a specialist affiliate marketing agency, and you name it, right? And then, we moved into, let’s have full service agencies that can do everything. Doesn’t matter whether they are two people sitting there and doing everything, but they’re full service. And what you just said is, basically, if you want to go into the market now, you want to come out of your full-time position, maybe an agency wherever you are. Think about finding a specialist topic where you’re really good, and offer that, instead of saying I can do all of this, but maybe I’m more generalist.

John Durham: And you know, I think that’s a really good point. I like strategy because I think strategy gets lost. Brands want strategy, they just don’t want to pay for it. So, we work with agencies to provide white label strategy, and we work directly with brands, and then work with their agencies to help bring it alive. So, we’re both. But I like strategy. I respect the men and women who are in media, respect the men and women who are in creative, I’ve worked in all those environments where you have all of that. But you have a point of view that becomes one-sided, and sometimes, B to B, B to C, is, you know, are never the same. And even in B to C, there’s so many different types, that sometimes you need that external voice that has a sense of objectivity.

Building Your Marketing Team

Steffen Horst: That makes sense. So, it’s the idea, you see a lot of collectives popping up. This group of people where someone of strategy background, someone with creative background, someone with, I don’t know, research background, you can kind of fill the list. Is that the way to move forward?

John Durham: That’s one way. That’s one way. I know firms that are doing that, they’re putting these collectives of brainpower. I tend to like to work with media shops that do media. I tend to like to work with creatives that do creative. B to B creative, B to C creative. And, you know, I know all the people who play and I know all of my competitors, and I know, for the majority across the country, what they do really well, and I know how we compete against them, and how they compete against us.

And I think big is just not cool today. No, not that I think holding companies or, you know, they’re going to go away, they’re not. But if you’re an emerging brand, and you’re a brand that needs a better share of voice, you’re a brand that needs to write your story, tell your story, you need a fresh perspective. There’s far more choices, far better choices, than just being in New York. There’s, across the country, so many great people to work from.

You have to create that work-life balance.

Steffen Horst: Yeah, absolutely, absolutely. And what I also want to add to that is, it’s probably also a question of the fee that that brand has to pay for the service they receive, right? I mean, I work for big global agencies, you worked for Carat, as I saw on your LinkedIn profile. You know, our only rates for even juniors at big holding companies, they are high. You pay two hundred and fifty, three hundred and fifty dollars for someone who has less than a year experience just because the office is on Madison Avenue in New York, and office space is expensive there. The deed they had needs to be paid, and you name it. So, when you work with someone that is, or with a company that is more streamlined, that maybe has a more virtual approach to things, where overhead is lower, you might even get better people, because you’re not stuck with someone who has a year experience.

I don’t want to say someone who has a year experience is not good, there are exceptions, you know. But the reality is someone who has been in that field for four or five years, they have worked on different projects, they’ve seen different scenarios and had to overcome different situations. So again, much more experience, and know what to do.

John Durham: I agree. You know, to paraphrase, the Uber, the grit gig economy, there’s a lot of smart people out there that, in 2019 are looking at their life in a different way. And sometimes, touching in and bringing those people in on projects, I personally love projects. You know, it’s challenging, there’s the economic model projects makes business challenging. But we’ve been project-based for ten years, we started out as a modicum of retainer end projects, but the world’s gone to projects, retainers are moving away. Projects are measurable, projects are actionable. Doesn’t mean they’re cheap, to me they’re more accurately reflecting the marketplace.

Steffen Horst: I agree. I totally agree. On another topic, so, when it comes to building an agency, obviously, having the right people in place is quite important. Unless you start off your agency and bring in a big client, you know, you usually start off with having one small one, or maybe if it’s one person, maybe if it’s two people. When you grow, what people should someone hire next? Should they go for someone that’s an execution person? Should they go for another senior person to offload some of the work that has to be done from building the agency perspective?

John Durham: It’s one I think about all the time. My first criteria is curiosity. I want people who are curious. That doesn’t define them by age, that doesn’t define them by education, it defines them more by their lens into experience. I have hired people right out of college that have just been rock stars, then I’ve hired people that have burnout and I didn’t see it because they didn’t, you know, they talked the game. To me, curiosity, how you view the world, how you see the opportunity, how, you know. I think people is the hidden joy in our business. Steffen, I’ve hired many, many, many, many people. And I’ve been very fortunate, so many have worked. There’s been about fifteen, eighteen, twenty, that have been disasters. They’d take down the Golden Gate Bridge in an earthquake.

But, you know what, and I went back, why didn’t they work out? It’s because the criteria that I look for, EQ, IQ, AQ, CQ. AQ is asshole quotient and C is cultural. I didn’t see the four of them blending well together. I think that’s important. But I’ve been very lucky, I’ve really got to work for and with such good people. I get so proud when people who work for me get hired away. Some people really freak out over that, I consider it a badge of courage. It means I’ve hired well.

Steffen Horst: Yeah. So, let’s say you found an agency. What things would you do yourself, and then obviously, your day has twenty-four hours, and a week has seven days. And which other things you would delegate. Is there something that, say what, do the things that you’re best in, and focus on that, and for everything else, bring contractors out, whoever you want to hire. Or would you approach that differently?

John Durham: I love going out, getting new business. I know what I do well. I love getting new business, but I love hunting. I love the hunter going out and prospecting and talking and asking questions. That part gets me very excited. Fortunately, because I know my strength, and I know the things I’m not good at, I tend to make sure that, surround myself with people who are better than me in the other areas that we need to be a complete team. That’s how I think about it.

Steffen Horst: I think that makes a lot of sense. I mean, you mentioned you have hired people from college, I have this question written down. Cheap Juniors or expensive Seniors? What’s your view on that when it comes to hiring? Does it depend on the position?

John Durham: Somewhat, but I’ll tell you why it’s worked for me, because when they’re in class, and usually I get them when they’re in their Senior year, I see how they present, I see how they write, I see how they interact with people. So, I’m already ahead of the curve to see how they are as people, and more important, I’ve seen the writing and the presentation skills, which I think is very, very important. So, I have a little leg up on that. And I’m also willing to give them a chance, and a lot of people, hey, I want somebody with three years’ experience. Three years’ experience in this, you know, is one, you’re going to tend to overpay, ’cause they’re going to think they’re worth a lot more. And they’re usually not. And if you’ve seen them in college, you know how they handle risk. And I think that’s a good thing, I really do.

Steffen Horst: So, that’s a big, like you said, you get a leg up there. How would you recommend other people approaching that scenario? Cheap Juniors, or expensive Seniors? The ones that don’t teach and therefore, you know, don’t see how the students kind of hold themselves up in stress situations, how they present, how they write, those kind of things.

John Durham: It’s just instinct. I’ve just been lucky. But it’s just instinct in conversations. I tend to hire more younger because I think it’s better, and you have a better change of their eagerness, their curiosity. And then when I hire very Senior, they usually have a real nuanced expertise.

Steffen Horst: You mentioned earlier, it’s like making two statements on processes. If you bring in Junior people. Obviously, for you, they’re a little more vetted because you’ve seen them in a classroom.

John Durham: You were dead, I can’t hear you.

Steffen Horst: Oh, can you still hear me? John?

John Durham: Yes, sorry.

Steffen Horst: Okay. Let’s give it a few seconds so they can stick it together.

You mentioned earlier, you talked about processes and had a slight negative comment on processes in regards to importance. Since you are hiring people, I don’t expect you’re hiring everyone from University, but some of them who are Juniors and probably no prior experience, how important for this scenario are processes, to make sure that they do the work in a way how you envision it and how you want to provide it to a client?

John Durham: Great question, and usually the people that they work for, at least in town with them to make sure they do the right, appropriate hand holding and they spend time. You know, we take very young people to sit in with clients and observe so they see how clients are, and they see how we observe and handle. So, they don’t get shut out at the door, they get to see and they’re like, immediately thrown into the ocean, and I think that’s a good thing. And then, you know, there are times that you need to have a conversation with them. You can’t be too enthusiastic, but you can be too much of a noodle, at times. You’ve got to sort of always stay diligent.

Steffen Horst: And is there something like, I mean, too many processes? And are there certain processes you say and what you should have at least these five processes in place, to make sure the basic operation runs smoothly?

John Durham: Well, I definitely think they need to know all of Microsoft skills. They need to know how to complete a sentence, they need to know how to talk on the phone, talk to people. You know, we spend time on body language, how to read a room, how to read people. We go through a lot of that, what I call people quotient. People understanding how to read people, that’s what we do in our business. So, that’s, to me, very important.

Steffen Horst: Is that something from your perspective that is something natural, given? Or that you can also teach someone, and a person can be as effective as someone that naturally might have that capability?

John Durham: I think it’s a combination of both today. I think digital does many things, I think digital does many things right, but you’ve got to make sure you temper people being obsessed with the screen by also understanding human nature. And then you create systems that allow them to dabble in both. See how they function.

Is Marketing Specialization a Good Idea for an Agency?

Steffen Horst: Yeah, yeah. I wanted to briefly come back to offerings, service offering. I mean, we haven’t talked about it specifically. But earlier, when we talked about whether someone should specialize in something that they do really good, or whether they should become a generalist. One question that I see in forums where we provide feedback is, should I provide a service that I normally don’t provide just to keep a client, because there is a danger of another agency coming in and they also provide the other services we already give to that client? Does that make sense.

John Durham: Yes. Well, which is one reason why that I like what we do. Because a lot of agencies, oh, we have a brand strategist, and they’re nothing more than a cost planner. And I don’t want to do what you do, I don’t want to do what creative agencies do, I know what we do best. We developed systems, process, methods to get to the essence of a brand. And I like that. Do we weigh in when we’re asked about, how would you take that to life? But only with the caveat that we’re not creative. We’re not media. But we will spend time with the creative and media shops and figure out, how do we come to this play?

Like today, I was with a firm’s PR agency, going to our new brand positioning, and the PR firm said, oh, this is really good, we need this for tone and voice, this is our new boilerplate. And so, we didn’t write it as boilerplate, but it ended up being the language that they can now work with. Because they’re sort of stuck in, how can they better tell the story?

Steffen Horst: So, basically, to kind of summarize what you said, it’s like, be confident in what you’re doing. Provide a great job there, if you do so, there most likely is no danger in losing a client, but if you overextend, there might be danger that you lose the client because you’re not able to deliver the solution as well as you deliver the other service that you give.

John Durham: And I argue that, you know what you do well. That’s what the client buys. And if you say, all of a sudden, you become Staples, hey, we can do that, you begin diminishing your work. That’s not a good thing.

Cash Flow For Marketing Agencies

Steffen Horst: I have one question on finances. I read an article today about cash flow and loans for small businesses, but I think it applies to agencies, too. The key line there was, you know, it doesn’t matter whether they have a positive cash flow in your small company, you should go and take out a loan at this point because you don’t know how long you’re doing well, and when you’re not doing well, it might be harder to take a loan out. Do you have any view on that? Would you say, you know, go out, you have positive cash flow, go out, get a loan, and put it aside, pay it monthly off, but just have the money for bad situations?

John Durham: I’ve talked to a lot of agencies who have done that, and they’ve been more happy than not. There’s so many people who are doing that, but because we’re so prided in time constraint, we sort of stay on top of what we need to do. I’m not going to tell you it’s easy, I’ve thought about it, but I’ve talked to some people who are very glad they did that. So, I guess there’s an answer to your question, a greater feeling about it being good today, than in the past.

The Future of Agency Specialization

Steffen Horst: Okay, good. So, we talked very early in the podcast about what is important in 2019. We talked about data, but what’s your vision for the agency in general in the future? Especially taking consideration, you know, that AI, for example, is becoming such an important, or such a strong solution in the market that might, you know, in two, three, four years, is able to create paid search campaigns, or buy autonomously programmatic campaigns, or paid social campaigns. Or, Google is improving their platform to literally almost to a point where there’s no human input required to buy media. And then obviously, cost is also a huge factor. So, what’s your view on the vision of the agency in the future? Is there a particular area where you think your agency will move towards?

John Durham: I think the agency is going to create this sense of bifurcation that brands are going to hire specialists, they’re going to hire us for this on projects, they’re going to hire you on continuing media, they’re going to hire somebody else for creative, they need it. And then, they’re going to hire someone who can help them understand mobile commerce, and help them understand artificial intelligence and drive it into marketing. Sweet. I think the agency of the future is going to be a collection of intelligence offerings geared toward what you do best. And you scream that loud, and when you do so, you’ll win business. You’re not everything to everybody.

Steffen Horst: That’s a good point. If you had one last advice, or one advice to people out there who either founded an agency and are on their early stages or are thinking about founding an agency or a freelancer, what would that advice be? Something that they should do, or something they should really focus on?

John Durham: If you got a bad client, get rid of them. Nothing destroys culture more than a bad client.

Too many of us sometimes will keep that client because of cash. But I have seen that can be devastating to culture, it can be devastating to the humanity of our business. That’s a lesson that I learned the hard way, but one that I subscribe to. Get rid of bad clients.

Steffen Horst: I think I can attest that, that’s really a point that you should not forget about in the future. Get rid of bad clients, they will just cause you too much headache and it doesn’t matter how much you earn with them, it’s not worth the challenges and problems they create internally.

John Durham: They take away the soul of your team.

Steffen Horst: Oh, yeah. Oh, yeah, absolutely.

John Durham: That’s what we sell. I agree. I’ve gone through it, I learned the hard way, and boy, I tell you what. It’s now the easiest lesson. I don’t do it often, but when I do it, I don’t, you know, I go through the analysis. But I know if I’ve reached that point, then I know they need to go.

Steffen Horst: Great, John. I mean, thank you so much. We’re unfortunately at the end of the podcast. I really enjoyed the conversation.

John Durham: Same here.

Steffen Horst: How can people find out more about you and Catalyst SF?

John Durham: Catalystsf.com. Easy website. The S and F stands for strategy fundamentals, not San Francisco. So, you know, we’re fundamentally a strategy agency.

Steffen Horst: Right, right. And we’ll put the e-mail address and everything else in the information for the podcast. Thanks everyone for listening. If you like the Performance Delivered podcast, please subscribe to us and leave us a review on iTunes or your favorite podcast application. If you want to find out more about Symphonic Digital, you can visit us at symphonicdigital.com, or follow us on Twitter at SymphonicHQ. Thanks again, and see you next time.

 

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