July 10, 2024 • 22 mins
Join Anthony Karls and James Patterson from Rocket Clicks in this episode of Revenue Roadmap. Learn about effective measurement and tracking in paid media campaigns, how to connect marketing efforts to revenue, and ensuring you're asking the right questions to your marketing experts for optimal results.
00:00 Introduction to Revenue Roadmap
01:01 Meet James Patterson: Marketing Expert
03:49 Diving into Paid Media
03:59 Understanding Measurement and Tracking
06:00 The Importance of ROAS
06:47 Building a Marketing Waterfall
14:01 Challenges with Platform Metrics
19:03 Evaluating Your Marketing Strategy
22:24 Conclusion and Next Steps
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Anthony Karls (00:00):
All right.
Welcome, welcome.
So this is Revenue Roadmap,where we talk about sales and
marketing for localentrepreneurs.
So I'm Anthony Carls, presidentof RocketClicks.
Today, I'm with James Pattersonand I'm sorry, he's not the
author.
He is the marketer.
Uh, don't thank him for thebooks.
Uh, but so James is one of ourpaid media experts here.
At Rocket Clicks.
(00:21):
And today we're going to betalking with him.
So James, thanks for, thanks forjoining us.
James Patterson (00:25):
Yeah, it's great to be here.
Anthony Karls (00:27):
So, all right.
So our topic today is we aregoing to be in the realm of paid
media, and we're going to betalking about measurement
tracking and platforms.
So James has got some words ofwisdom here as it pertains to
that.
Like always, we are going to beconnecting.
These topics to revenue.
How did these impact drivingrevenue for your business?
(00:48):
And number two, how do you knowas a local entrepreneur, whether
or not this is being done well?
So if you work with a freelanceragency, or you got, you got some
schmo like, like James workingon this internally, you can ask
him all the right questions.
So, uh, So James, before we digin there, so what is, what's
your history with marketing?
How long have you been inmarketing?
(01:08):
How'd it get started?
Tell us a little bit aboutyourself.
James Patterson (01:11):
Yep.
So, uh, graduated college in2017.
So I've been in, uh, marketingever since.
Um, you know, it was kind ofchoosing my path.
I had an attraction towardsdigital, just knowing that, you
know, probably the place to bewith the way the world is
changing.
had the opportunity to actuallywork for a, um, really small
business.
And they basically had nomarketing Um, whatsoever.
(01:34):
So they decided to go cheap andthey hired a kid straight out of
college who didn't really knowwhat he was doing to do
marketing.
Um, but it forced me to learn alot about it.
And, um, really the fortunatething for me is I got to, um,
learn what I like to do withinit and, and where I had
interest.
Um, from there I worked for abig, um, corporation in
Wisconsin here.
Um, I was part of the digitalmarketing team there.
(01:56):
Um, kind of similarly, I had anopportunity to do kind of jack
of all trades type work,actually.
Ironically, um, now much morepaid than, than anything else.
But, uh, starting out, Iactually was doing more SEO work
than I was paid.
Ended up, uh, kind of liking thepaid side of the business a
little bit more.
So really kind of dive, divedinto that.
(02:17):
Um, kind of got to a point in mycareer was like, Hey, I'd like
to, uh, join kind of a team of,of experts realizing agency life
is really the place for that.
Um, you know, kind of the restis history.
So I've been at RocketClicksince, uh, 2021.
and yeah, it's been a greatride.
So my story.
Anthony Karls (02:36):
And why did, so why'd you pick marketing as a
career?
What, what interests you aboutit?
What's uh, what's intriguing?
James Patterson (02:43):
Yeah.
So it's kind of a funny story.
So, um, my mom was an HR andshe's kind of my role model in
my career.
Yeah.
Um, so I knew I was, I wasalways attracted to business of
some sort and I didn't knowwhere to go.
And, um, I think if youprobably, you know, surveyed a
large group of marketers thatprobably all would say this, or
a large percentage of them waslike, nah, just kind of sounded
(03:04):
good.
Um, so that's what I went with.
I went with it.
Um, you know, obviously going,uh, with the marketing, um,
degree and going through thecoursework and stuff like that,
I was really attracted to theidea of like, you know, Being
able to understand the kind ofpsychographic elements to
selling things and stuff likethat.
So, um, really when I startedgetting through those college
courses are really reinforced, Iwas in there in the right space,
(03:26):
but I was this close to, tobeing a sales guy, but, uh, uh,
stayed on the light side ofthings here and, uh, it out with
marketing.
Anthony Karls (03:35):
Nice.
Well, like we say here, salesmarketing is the same thing.
Sales is, sales is one to one,marketing is one to many, so you
still got it in the sales.
James Patterson (03:45):
Yep.
Anthony Karls (03:45):
All right, so let's jump into, let's jump into
some of this.
So, paid media, we, we talked ina couple episodes about kind of
how to think about it, what itis overall.
So we're, today we're talkingabout measurement and tracking.
So let's start first on themeasurement side.
So James, tell us a little bitabout what we.
What we think about as itpertains to measurement, um,
(04:08):
measuring success with our paidcampaigns, how do we think about
it?
What are, what are things welook for?
Just give us an overview.
James Patterson (04:16):
Yeah.
So, I mean, I think measurementis probably the, one area that I
think most clients, especiallywhen we're kind of kicking off
with them or are most interestedin, or feeling unsure if they're
doing the right things in termsof, um, you know, kind of really
understanding what, what is,what are these marketing tactics
actually doing for my business?
Um, we see a lot of tendencieswhere businesses are really
(04:37):
looking at the front endmetrics, right?
So like coming to us and like,Hey, is this, you know, is this
impression share good?
Is this cost per click good?
Um, even, you know, a little bitfurther down looking at cost per
lead or conversion rates andthings like that.
Um, those are places where Ithink a lot of, uh, businesses
start when they're looking at,um, different channels that
they're running as, as placesfor success.
(04:58):
Um, where we really see thingsworking best with clients is
going much further than justthose front facing metrics,
because it really doesn't tellthe whole story.
like in an ideal state, thesebusinesses are actually building
a marketing waterfall, so tospeak.
So seeing basically from.
Start to, to finish in terms of,um, you know, completed sale to
(05:18):
getting, you know, actuallyleads in their businesses that
are starting out as users, goingto clicks, so on and so forth,
their way through the pipelineis kind of what's the return
there.
So like how much revenue, um, amI actually generating per, you
know, customer acquisition orwhatever your business is.
Um, and tying that back to youractual CPL there.
So opposed to taking a CPL outof just Google, which is like
(05:41):
really doesn't tell you a wholelot.
You can really tie it back toROAS, make sure you're getting a
healthy return on ad spend andthen getting an actual accurate
CPL, especially as it pertainsto those higher quality leads
really at that sales qualifiedlevel versus marketing qualified
or even higher in a lot ofcases.
Anthony Karls (05:57):
Yeah.
So let's just talk about that.
Let's talk about two things.
So like first, what is ROAS?
So you threw that out there.
What does that, what does thatmean?
James Patterson (06:04):
Yeah, so ROAS is return on ad spend, so it's
really, you know, how much moneyam I putting in and then getting
back per, you know, my activityon a given channel.
So, um, you can calculate thaton, in terms of like how much,
you know, marketing spend do youhave going into this channel?
How much leads am I getting atthe end of the day?
How many customers am I gettingat the end of the day?
So instead of looking again atkind of the front facing side of
(06:26):
that is like, you can get a rowas even if you're a lead
generation business, like youcan calculate what your average
value per customer is and thingslike that.
And really tie it back to thatmarketing spend overall to
understand really what is yourreturn on all of the marketing
costs associated with runningyour business.
Anthony Karls (06:43):
Yeah.
So in that, you talked about amarketing waterfall.
So let's talk a little bit aboutthat.
You mentioned lead, youmentioned, you mentioned MQL,
you mentioned SQL, and youmentioned sales.
So like, and then you mentionedrevenue.
So like.
Yeah.
Walk me through, through thesethings.
Cause I think you also saidusers and clicks and you said a
bunch of stuff.
So like walk me through what we,what we start requesting from
(07:07):
our clients when we startengaging with them.
So we can build that and we canmove towards off platform
metrics and towards more of aROAS type scenario.
James Patterson (07:17):
Yep.
So it is going to vary,obviously, like every business
we work with may, may havedifferent levels to this, but
generally speaking, what we'relooking for is some, is kind of
a flow like this is users.
How many clicks are coming from,you know, different channels
within your different tactics,how many leads are generated
from that and which place youcan, you know, kind of determine
(07:38):
what your rate is from all thoseusers and clicks coming into
your site and then ultimatelyconverting to a lead.
Then from there, obviously thatlead is going to undergo some
process within your salespipeline, you know, talking to
the call center, maybe they'retalking to a provider at your
health spot, whatever the casemay be.
then is, you know, the, thetransition from just kind of an
inbound lead to a marketingqualified lead.
(08:01):
there, they're then talking to asales team member or maybe some,
you know, some expert kind ofdown the line in terms of your
business from there, you know,is there some type of rate we
can calculate from a marketingqualified lead to then a sales
qualified lead?
So meaning,
Anthony Karls (08:14):
So Mark, sorry to cut you off.
So a marketing qualified lead iswhat is that more specifically?
So basically I'm a lead and thenI go to a marketing qualified
lead.
What is that?
James Patterson (08:25):
yeah, so like, think about it this way.
So if, if a lead was coming intoyour business, all they have to
do, right, is either call ormaybe the, you know, a lot of
cases to fill out a form.
Well, somebody could fill outyour form and it could be a
college student.
It could be a bot, you know, itcan be all kinds of different
things.
So you still need someevaluation process from just
like receiving the contactinformation or the, or the call
from the person to evaluate.
(08:46):
This is somebody that I shouldactually have talked to my sales
team member, whoever.
Kind of the next layer down isin terms of your customer
acquisition strategy.
So it's really that first stepof, of like, um, ensuring
quality in terms of this personis looking for my service.
They understand, you know,generally what we're offering
and they can move forward tokind of the next step.
Anthony Karls (09:06):
Yeah.
So then a sales qualified leadis basically a marketing
qualified lead that sets anappointment for most of our
clients.
That's usually what it lookslike.
Is that kind of what you'resaying?
James Patterson (09:16):
Exactly.
So working, um, with a law firm,what that looks like as a
marketing qualified lead, theywould be getting into the system
and hand it off to like anattorney to actually have.
Conversation with that attorneyabout their case and, you know,
uh, interest in, in potentiallymoving forward and hiring that
attorney ultimately.
Anthony Karls (09:32):
Got it.
And then from there.
Then we're taught then it's didthis turn into a client.
Is that correct?
James Patterson (09:39):
Exactly.
Yep.
So from there, sales qualifiedlead, obviously kind of,
depending on your business, youknow, maybe they don't really
stay in that, in that, um,status very long in some
businesses like the law firm,like, you know, usually people
need to think about it.
There's a kind of aconsideration phase from there.
Um, but yeah, ultimately thegoal is, you know, your sales
qualified leads, you'reconverting those at a pretty.
Um, high rate, just knowing thatthey've kind of gone through all
(10:01):
these stages throughout thatjourney.
Anthony Karls (10:03):
Awesome.
So, and then what we wanted thenso then that's we have a sale
that sale has revenue associatedwith it, whether it's contracted
or immediate, and that's thenumber you're actually trying to
plug back into whatevermarketing platform they're
using.
James Patterson (10:19):
Exactly.
So like best case scenario isyou can look back, you know, in
time, you know, it's over thecourse of, you know, probably
two years, something like that.
I mean, it can be short if youdon't have that data, but
longer, the better to determinewhat is the value of the average
customer that we get.
and what's that average revenue.
(10:40):
Cause if you have that number.
Then you can work back all theway to the top and determine
what's actually the value ofjust that first step, just a
click coming in or the, youknow, the first step in the
inbound lead.
Um, and you can work yourselfdown there to really understand
what's the true value at eachstep.
And then what's the returnnecessary, obviously at the end
of it all to make it all makesense from a marketing costs
(11:02):
perspective.
Anthony Karls (11:03):
So when we're thinking about, so, and so we,
we talked about cost per lead atthe beginning and a lot of
people start there and that's,you're probably tracking phone
calls and you're probablytracking just like web form
submissions.
So if I have, if I have revenueback in my platform, how does
that change that number and whatdoes that give you the power to
do as a paid media expert?
James Patterson (11:27):
Yeah, exactly.
So like one of the things thatwe see a lot, just to like show
it an example is like, let's sayon average last year you're
getting like a 50 CPL and you'renot everything back to revenue
in your business.
And so here's the next yearyou're expecting about a 50 CPL.
And let's say things arestarting to increase a little
bit, right?
Now things are more like a 75CPL for a business.
(11:49):
That's not tying this back torevenue.
Sirens are going off, right?
They're like, Oh my God, what'shappening?
I can't afford this.
This is, you know, that's goingto compound naturally, right?
Well, if you're doing everythingcorrectly in terms of the tying
it back to your kind of backendmetrics in your business, can
actually, you know, show orprove that maybe I actually can
afford to spend 25 more becausemaybe those leads that are
(12:13):
coming in are actuallygenerating higher value than
let's say our average that we'vedetermined through all these
exercises.
So that's really where it comesinto, into play is like.
If you get so focused on thosefront end metrics, what you
could be is like, you know,you're saying, Oh, I want to
keep my CPL low.
Cause I'm trying to protect mybusiness and my business health
and financials.
You actually could be indirectlyhurting your business, getting
(12:34):
too caught up on rising CPLs,for example, unless you have
those metrics and can really tieit back.
Cause there, you know, of coursethere is, there is a, uh, too
expensive lead that probablyexists in your business.
But if you're not doing allthose steps.
You don't truly know what thatnumber is to make sure that
you're getting the returnthat's, that's necessary.
Anthony Karls (12:54):
From, uh, from a learning perspective on some of
these platforms, um, likespecifically Google, I know we,
we do this a lot for a lot ofour clients in Google.
Um, What does this allow us todo from a strategy and actually
leveraging the power of their AIversus like, all we have is a
call and a web form.
Like what, what's the differencein performance?
James Patterson (13:17):
Yeah.
It's, it's usually drastic.
I will say that becauseespecially if you can, if you're
using systems like Salesforce orother CRMs, or you can tie back
metrics from your system.
A lot of times you can actuallyunderstand like which part of
your campaign strategy orplatform strategy is actually
driving, you know, the mostnumber of those sales qualified
leads, for example, and thingslike that.
(13:37):
Um, so what you're going from iskind of a, uh, thumb and, you
know, finger in the wind typescenario on the kind of, uh,
first version to like, no, weknow specifically this campaign
is a big driver of our revenue.
And if we were to turn this off,Even though we're seeing, you
know, kind of normalfluctuations or the case may be
in performance front facing.
We know on the backend thatthings are really healthy and,
(13:58):
you know, it's critical to ouroperation.
Anthony Karls (14:00):
Yeah.
So, um, We got one more questionin here.
So what about how accurate arethe, the metrics that we're
seeing in the platform whenwe're measuring, even when we're
measuring return on ad spend,whether we're measuring that or
CPL or any variant there they'rein, what's the general accuracy
(14:25):
that we see?
And like, how do we think aboutthe in platform metrics and why
is it so important to look atthe offline?
James Patterson (14:32):
Yeah.
So basically the only metricsthat you can guarantee are close
to a hundred percent accurateare going to be your offline
metrics for sure.
Um, the problem is, is that alot of these platforms, right?
It's attribution is going tovary.
We have the changes in, in allof these privacy laws that have
been I'm sure a lot of peopleare aware of at this point,
third party cookies.
(14:53):
I think everybody, even peoplethat aren't in this industry
are, are, are hearing thesethings in the news and whatnot.
Um, the more and more of these,these laws go into place, um,
the, the less and less accuratethese platforms can be at really
telling us if, you know, it's,it's driving, um, you know,
leads or the performance thatkind of we're expecting from it.
(15:14):
making it more critical toreally go through the exercise
of creating a businesswaterfall.
So you can really understandoutside of what's in that
platform, what is actuallyhappening as we're spending
money in these differentchannels, or the case may be to.
Um, you know, help our businessgrow or to our detriment.
Do we need to scale back?
You know, that's, that's alwaysfun too, right?
(15:34):
It's like, we, we see sometimesworking with clients, it's like,
well, actually we're doingreally well and we need to like
take the, take the gas off thefire because we know our metrics
are working so well, so, um,yeah, unfortunately the, the
front facing metrics especiallyare going to get less and less,
um, accurate kind of, as we moveforward.
It makes really.
(15:55):
Being able to tie your backendnumbers to your marketing, you
know, um, strategy overall moreand more critical to really
understand how these platformsare playing into your business
growth and goals for the year.
Anthony Karls (16:07):
So just as like, uh, I know the rule of thumb we
typically talk about hereinternally is the, it's, it's
about 60 to 70 percent accuratewhen we look at an attribution
perspective.
And I think you talked about itreally well, um, as it pertains
to tracking, which is our nexttopic.
So just to like cap offmeasurement.
So why is it so important tolike, if you're going to be
(16:28):
entering paid strategy to, tounderstand this and to invest
in, you know, The connections ofdata for driving revenue.
James Patterson (16:39):
Yeah.
I mean, I think the biggestthing is this is like, you know,
if you're, if you are relying onthese platforms to help grow
your business, You're looking atthe wrong things.
You're, you're more likely tomake a mistake in terms of
evaluating it.
So like understanding thetracking isn't perfect is a big
part of that puzzle is like,Hey, we need to figure out how
(17:00):
we can track this with our owndata, right?
You're at the end of the day,you're, you're the business, you
own the, the customer data toreally tie that back to
understand what's working andwhat's not.
Cause if you rely so closely onwhat's in platform.
You know, it's like I said, you,you could be, you could think
you're really healthy businessand actually, you know, your,
your, your spend or strategy isnot working and driving a return
(17:22):
that's profitable for you.
And to hit your goals this yearor vice versa, you could be
putting caps on things and, andpotentially kind of shooting
yourself in the foot becauseyou're looking at these front
facing metrics or, you know, Idon't think we're getting enough
leads from Google specifically,but what really could be
happening is that maybe Googleis not getting credit for
everything that that it'sdriving.
Um, it's always fun doingexperiments and stuff with
(17:44):
businesses.
Um, being, uh, strikes out as,as an example where, you know,
front facing metrics, we wereseeing things weren't super
strong.
Um, so one day someone justsaid, Hey, why don't we just
turn that thing off?
And, you know, it doesn't reallydo anything.
Well, because we had good accessto the backend numbers, as soon
as we turned that off, all of asudden we saw, we saw something
(18:06):
weird.
We just saw our CPL, uh,continue to increase across our
whole marketing waterfall.
It's like, what's going on here?
All of a sudden we're getting,we're paying more for, for leads
than ever.
And we just took out a bunch ofspend.
We paused a whole channel.
Well, it turned out that yeah,it all goes back to this.
The tracking and attribution isjust not, not all that great.
(18:27):
looking at just the front facingmetrics, you're going to make
Decisions like this, because youdon't truly know if it's, if
it's playing a factor in, inachieving your goals.
And sure enough, um, we put Bingback on and all of a sudden that
CPL went right on back down towhere we wanted it.
So it's, always a fun, funexample to call out.
Cause it's like, yeah, if you,if you stay focused on the
(18:48):
front, you're pro, unless youhave a really strong back,
backend system to really measurethis, like you could be, you
know, causing detriment to your,to your marketing operation.
That was definitely a fun lessonwe learned.
Anthony Karls (19:04):
Uh, so, so if I'm, if I'm working with a
freelancer agency or someoneinternally, how do I know, how
do I know I'm being guidedcorrectly?
Like what should I be lookingfor?
James Patterson (19:17):
Yeah.
I, I would say a big red flag isa lot of what we just talked
about in terms of like, what,what's the data they're bringing
you, like, are they, are theycoming to your, you know,
monthly meetings or whateveryour cadence is or giving you
reports and it's all just frontfacing metrics, like, it's just
like, Hey, we drove this manyleads and it's the conversion
column and Google ads, and thisis the CPL we're getting in, um,
(19:40):
providing insight there.
Um, I would say that would bekind of a red flag to me.
Cause.
Agencies at this point in thegame, knowing all these changes
to data, privacy and stuff, it'slike, this isn't groundbreaking
that, that we really need to tieback marketing performance to
your, your business and thefinancials and understanding
values and things like that.
(20:00):
Cause if you're not doing that,then yeah, it's just finger in
the air.
So that would be a red flag.
I would say a green flag is verymuch the opposite.
If you're coming to a call, likeI always call it out, you know,
Ro we've been talking about rowas.
A lot, a lot of businesses thinkthat's an e com metric.
That is definitely not an e commetric.
That could, that is applicableto any business that exists.
If you're spending money onmarketing costs, you're getting
(20:22):
some revenue from your customeracquisition.
You should, you can tie backrevenue to the costs acquired to
drive leads for your business.
So if they're bringing thingslike that.
Despite you being a leadgeneration business, um, for
example, then I would sayyou're, you're probably working
with a pretty good partner.
Anthony Karls (20:39):
What are some of the questions that will be
asking me?
As the, as the local businessowner, like, what, what should I
expect them to be asking for me?
You're like, they're, they'reasking me for, they're asking me
for information.
I'm like, why are you asking mefor that?
But so like, what are the, Ishould be, I should be
considering as like a good, agood signal that I'm being
managed.
(20:59):
Well,
James Patterson (21:00):
Yes.
So a couple of things.
So timelines, like I talkedabout earlier, plays a big part
in this too.
I would say metrics that theyshould be looking at is leads
your whole business.
Um, categories like we talkedabout.
So you should have some, um, youknow, different differentiation
between a lead, a marketingqualified lead and a sales
(21:21):
qualified lead.
So usually you'd want to see allthree of those metrics if
possible.
And then of course, you know,funded customers or however you
want to say that completedacquisition in terms of, of the
customers coming in.
Um, the timeline piece to the,to this is huge though, too.
So like, if they're like, Hey,we want last month's only.
Um, I think there's a betterversion of that for sure.
(21:41):
We probably want to be lookingat things like up to two years,
maybe even further to really seewhat the pattern is.
Like where, where are you guysat for a business?
Um, that's going to help theagency really plug in and
determine like, Hey, what do weneed to do with our strategy?
To either stop this, you know,maybe negative pattern or on the
opposite side, not play anegative role in a very positive
pattern, for example.
(22:02):
So I really think it'd be those.
And then of course, you know,revenue coming in from, from
those levels from there,generally they can calculate the
different, um, you know, metricsthat they would need.
So like a lead to marketingqualified lead rate.
sales qualified lead rate, uh,you know, value of each of those
different lead statuses andthings like that.
Anthony Karls (22:22):
awesome.
This has been great.
I appreciate it, James.
James Patterson (22:26):
Yeah, it's been fun.
Thanks for having me.
Anthony Karls (22:28):
Yeah.
Thank you for this.
And then we'll, uh, continuepicking up next time.
James Patterson (22:34):
Awesome.
Looking forward to it.
Anthony Karls (22:36):
Thanks.
All right.
Welcome, welcome.
So this is Revenue Roadmap,where we talk about sales and
marketing for localentrepreneurs.
So I'm Anthony Carls, presidentof RocketClicks.
Today, I'm with James Pattersonand I'm sorry, he's not the
author.
He is the marketer.
Uh, don't thank him for thebooks.
Uh, but so James is one of ourpaid media experts here.
At Rocket Clicks.
(00:21):
And today we're going to betalking with him.
So James, thanks for, thanks forjoining us.
James Patterson (00:25):
Yeah, it's great to be here.
Anthony Karls (00:27):
So, all right.
So our topic today is we aregoing to be in the realm of paid
media, and we're going to betalking about measurement
tracking and platforms.
So James has got some words ofwisdom here as it pertains to
that.
Like always, we are going to beconnecting.
These topics to revenue.
How did these impact drivingrevenue for your business?
(00:48):
And number two, how do you knowas a local entrepreneur, whether
or not this is being done well?
So if you work with a freelanceragency, or you got, you got some
schmo like, like James workingon this internally, you can ask
him all the right questions.
So, uh, So James, before we digin there, so what is, what's
your history with marketing?
How long have you been inmarketing?
(01:08):
How'd it get started?
Tell us a little bit aboutyourself.
James Patterson (01:11):
Yep.
So, uh, graduated college in2017.
So I've been in, uh, marketingever since.
Um, you know, it was kind ofchoosing my path.
I had an attraction towardsdigital, just knowing that, you
know, probably the place to bewith the way the world is
changing.
had the opportunity to actuallywork for a, um, really small
business.
And they basically had nomarketing Um, whatsoever.
(01:34):
So they decided to go cheap andthey hired a kid straight out of
college who didn't really knowwhat he was doing to do
marketing.
Um, but it forced me to learn alot about it.
And, um, really the fortunatething for me is I got to, um,
learn what I like to do withinit and, and where I had
interest.
Um, from there I worked for abig, um, corporation in
Wisconsin here.
Um, I was part of the digitalmarketing team there.
(01:56):
Um, kind of similarly, I had anopportunity to do kind of jack
of all trades type work,actually.
Ironically, um, now much morepaid than, than anything else.
But, uh, starting out, Iactually was doing more SEO work
than I was paid.
Ended up, uh, kind of liking thepaid side of the business a
little bit more.
So really kind of dive, divedinto that.
(02:17):
Um, kind of got to a point in mycareer was like, Hey, I'd like
to, uh, join kind of a team of,of experts realizing agency life
is really the place for that.
Um, you know, kind of the restis history.
So I've been at RocketClicksince, uh, 2021.
and yeah, it's been a greatride.
So my story.
Anthony Karls (02:36):
And why did, so why'd you pick marketing as a
career?
What, what interests you aboutit?
What's uh, what's intriguing?
James Patterson (02:43):
Yeah.
So it's kind of a funny story.
So, um, my mom was an HR andshe's kind of my role model in
my career.
Yeah.
Um, so I knew I was, I wasalways attracted to business of
some sort and I didn't knowwhere to go.
And, um, I think if youprobably, you know, surveyed a
large group of marketers thatprobably all would say this, or
a large percentage of them waslike, nah, just kind of sounded
(03:04):
good.
Um, so that's what I went with.
I went with it.
Um, you know, obviously going,uh, with the marketing, um,
degree and going through thecoursework and stuff like that,
I was really attracted to theidea of like, you know, Being
able to understand the kind ofpsychographic elements to
selling things and stuff likethat.
So, um, really when I startedgetting through those college
courses are really reinforced, Iwas in there in the right space,
(03:26):
but I was this close to, tobeing a sales guy, but, uh, uh,
stayed on the light side ofthings here and, uh, it out with
marketing.
Anthony Karls (03:35):
Nice.
Well, like we say here, salesmarketing is the same thing.
Sales is, sales is one to one,marketing is one to many, so you
still got it in the sales.
James Patterson (03:45):
Yep.
Anthony Karls (03:45):
All right, so let's jump into, let's jump into
some of this.
So, paid media, we, we talked ina couple episodes about kind of
how to think about it, what itis overall.
So we're, today we're talkingabout measurement and tracking.
So let's start first on themeasurement side.
So James, tell us a little bitabout what we.
What we think about as itpertains to measurement, um,
(04:08):
measuring success with our paidcampaigns, how do we think about
it?
What are, what are things welook for?
Just give us an overview.
James Patterson (04:16):
Yeah.
So, I mean, I think measurementis probably the, one area that I
think most clients, especiallywhen we're kind of kicking off
with them or are most interestedin, or feeling unsure if they're
doing the right things in termsof, um, you know, kind of really
understanding what, what is,what are these marketing tactics
actually doing for my business?
Um, we see a lot of tendencieswhere businesses are really
(04:37):
looking at the front endmetrics, right?
So like coming to us and like,Hey, is this, you know, is this
impression share good?
Is this cost per click good?
Um, even, you know, a little bitfurther down looking at cost per
lead or conversion rates andthings like that.
Um, those are places where Ithink a lot of, uh, businesses
start when they're looking at,um, different channels that
they're running as, as placesfor success.
(04:58):
Um, where we really see thingsworking best with clients is
going much further than justthose front facing metrics,
because it really doesn't tellthe whole story.
like in an ideal state, thesebusinesses are actually building
a marketing waterfall, so tospeak.
So seeing basically from.
Start to, to finish in terms of,um, you know, completed sale to
(05:18):
getting, you know, actuallyleads in their businesses that
are starting out as users, goingto clicks, so on and so forth,
their way through the pipelineis kind of what's the return
there.
So like how much revenue, um, amI actually generating per, you
know, customer acquisition orwhatever your business is.
Um, and tying that back to youractual CPL there.
So opposed to taking a CPL outof just Google, which is like
(05:41):
really doesn't tell you a wholelot.
You can really tie it back toROAS, make sure you're getting a
healthy return on ad spend andthen getting an actual accurate
CPL, especially as it pertainsto those higher quality leads
really at that sales qualifiedlevel versus marketing qualified
or even higher in a lot ofcases.
Anthony Karls (05:57):
Yeah.
So let's just talk about that.
Let's talk about two things.
So like first, what is ROAS?
So you threw that out there.
What does that, what does thatmean?
James Patterson (06:04):
Yeah, so ROAS is return on ad spend, so it's
really, you know, how much moneyam I putting in and then getting
back per, you know, my activityon a given channel.
So, um, you can calculate thaton, in terms of like how much,
you know, marketing spend do youhave going into this channel?
How much leads am I getting atthe end of the day?
How many customers am I gettingat the end of the day?
So instead of looking again atkind of the front facing side of
(06:26):
that is like, you can get a rowas even if you're a lead
generation business, like youcan calculate what your average
value per customer is and thingslike that.
And really tie it back to thatmarketing spend overall to
understand really what is yourreturn on all of the marketing
costs associated with runningyour business.
Anthony Karls (06:43):
Yeah.
So in that, you talked about amarketing waterfall.
So let's talk a little bit aboutthat.
You mentioned lead, youmentioned, you mentioned MQL,
you mentioned SQL, and youmentioned sales.
So like, and then you mentionedrevenue.
So like.
Yeah.
Walk me through, through thesethings.
Cause I think you also saidusers and clicks and you said a
bunch of stuff.
So like walk me through what we,what we start requesting from
(07:07):
our clients when we startengaging with them.
So we can build that and we canmove towards off platform
metrics and towards more of aROAS type scenario.
James Patterson (07:17):
Yep.
So it is going to vary,obviously, like every business
we work with may, may havedifferent levels to this, but
generally speaking, what we'relooking for is some, is kind of
a flow like this is users.
How many clicks are coming from,you know, different channels
within your different tactics,how many leads are generated
from that and which place youcan, you know, kind of determine
(07:38):
what your rate is from all thoseusers and clicks coming into
your site and then ultimatelyconverting to a lead.
Then from there, obviously thatlead is going to undergo some
process within your salespipeline, you know, talking to
the call center, maybe they'retalking to a provider at your
health spot, whatever the casemay be.
then is, you know, the, thetransition from just kind of an
inbound lead to a marketingqualified lead.
(08:01):
there, they're then talking to asales team member or maybe some,
you know, some expert kind ofdown the line in terms of your
business from there, you know,is there some type of rate we
can calculate from a marketingqualified lead to then a sales
qualified lead?
So meaning,
Anthony Karls (08:14):
So Mark, sorry to cut you off.
So a marketing qualified lead iswhat is that more specifically?
So basically I'm a lead and thenI go to a marketing qualified
lead.
What is that?
James Patterson (08:25):
yeah, so like, think about it this way.
So if, if a lead was coming intoyour business, all they have to
do, right, is either call ormaybe the, you know, a lot of
cases to fill out a form.
Well, somebody could fill outyour form and it could be a
college student.
It could be a bot, you know, itcan be all kinds of different
things.
So you still need someevaluation process from just
like receiving the contactinformation or the, or the call
from the person to evaluate.
(08:46):
This is somebody that I shouldactually have talked to my sales
team member, whoever.
Kind of the next layer down isin terms of your customer
acquisition strategy.
So it's really that first stepof, of like, um, ensuring
quality in terms of this personis looking for my service.
They understand, you know,generally what we're offering
and they can move forward tokind of the next step.
Anthony Karls (09:06):
Yeah.
So then a sales qualified leadis basically a marketing
qualified lead that sets anappointment for most of our
clients.
That's usually what it lookslike.
Is that kind of what you'resaying?
James Patterson (09:16):
Exactly.
So working, um, with a law firm,what that looks like as a
marketing qualified lead, theywould be getting into the system
and hand it off to like anattorney to actually have.
Conversation with that attorneyabout their case and, you know,
uh, interest in, in potentiallymoving forward and hiring that
attorney ultimately.
Anthony Karls (09:32):
Got it.
And then from there.
Then we're taught then it's didthis turn into a client.
Is that correct?
James Patterson (09:39):
Exactly.
Yep.
So from there, sales qualifiedlead, obviously kind of,
depending on your business, youknow, maybe they don't really
stay in that, in that, um,status very long in some
businesses like the law firm,like, you know, usually people
need to think about it.
There's a kind of aconsideration phase from there.
Um, but yeah, ultimately thegoal is, you know, your sales
qualified leads, you'reconverting those at a pretty.
Um, high rate, just knowing thatthey've kind of gone through all
(10:01):
these stages throughout thatjourney.
Anthony Karls (10:03):
Awesome.
So, and then what we wanted thenso then that's we have a sale
that sale has revenue associatedwith it, whether it's contracted
or immediate, and that's thenumber you're actually trying to
plug back into whatevermarketing platform they're
using.
James Patterson (10:19):
Exactly.
So like best case scenario isyou can look back, you know, in
time, you know, it's over thecourse of, you know, probably
two years, something like that.
I mean, it can be short if youdon't have that data, but
longer, the better to determinewhat is the value of the average
customer that we get.
and what's that average revenue.
(10:40):
Cause if you have that number.
Then you can work back all theway to the top and determine
what's actually the value ofjust that first step, just a
click coming in or the, youknow, the first step in the
inbound lead.
Um, and you can work yourselfdown there to really understand
what's the true value at eachstep.
And then what's the returnnecessary, obviously at the end
of it all to make it all makesense from a marketing costs
(11:02):
perspective.
Anthony Karls (11:03):
So when we're thinking about, so, and so we,
we talked about cost per lead atthe beginning and a lot of
people start there and that's,you're probably tracking phone
calls and you're probablytracking just like web form
submissions.
So if I have, if I have revenueback in my platform, how does
that change that number and whatdoes that give you the power to
do as a paid media expert?
James Patterson (11:27):
Yeah, exactly.
So like one of the things thatwe see a lot, just to like show
it an example is like, let's sayon average last year you're
getting like a 50 CPL and you'renot everything back to revenue
in your business.
And so here's the next yearyou're expecting about a 50 CPL.
And let's say things arestarting to increase a little
bit, right?
Now things are more like a 75CPL for a business.
(11:49):
That's not tying this back torevenue.
Sirens are going off, right?
They're like, Oh my God, what'shappening?
I can't afford this.
This is, you know, that's goingto compound naturally, right?
Well, if you're doing everythingcorrectly in terms of the tying
it back to your kind of backendmetrics in your business, can
actually, you know, show orprove that maybe I actually can
afford to spend 25 more becausemaybe those leads that are
(12:13):
coming in are actuallygenerating higher value than
let's say our average that we'vedetermined through all these
exercises.
So that's really where it comesinto, into play is like.
If you get so focused on thosefront end metrics, what you
could be is like, you know,you're saying, Oh, I want to
keep my CPL low.
Cause I'm trying to protect mybusiness and my business health
and financials.
You actually could be indirectlyhurting your business, getting
(12:34):
too caught up on rising CPLs,for example, unless you have
those metrics and can really tieit back.
Cause there, you know, of coursethere is, there is a, uh, too
expensive lead that probablyexists in your business.
But if you're not doing allthose steps.
You don't truly know what thatnumber is to make sure that
you're getting the returnthat's, that's necessary.
Anthony Karls (12:54):
From, uh, from a learning perspective on some of
these platforms, um, likespecifically Google, I know we,
we do this a lot for a lot ofour clients in Google.
Um, What does this allow us todo from a strategy and actually
leveraging the power of their AIversus like, all we have is a
call and a web form.
Like what, what's the differencein performance?
James Patterson (13:17):
Yeah.
It's, it's usually drastic.
I will say that becauseespecially if you can, if you're
using systems like Salesforce orother CRMs, or you can tie back
metrics from your system.
A lot of times you can actuallyunderstand like which part of
your campaign strategy orplatform strategy is actually
driving, you know, the mostnumber of those sales qualified
leads, for example, and thingslike that.
(13:37):
Um, so what you're going from iskind of a, uh, thumb and, you
know, finger in the wind typescenario on the kind of, uh,
first version to like, no, weknow specifically this campaign
is a big driver of our revenue.
And if we were to turn this off,Even though we're seeing, you
know, kind of normalfluctuations or the case may be
in performance front facing.
We know on the backend thatthings are really healthy and,
(13:58):
you know, it's critical to ouroperation.
Anthony Karls (14:00):
Yeah.
So, um, We got one more questionin here.
So what about how accurate arethe, the metrics that we're
seeing in the platform whenwe're measuring, even when we're
measuring return on ad spend,whether we're measuring that or
CPL or any variant there they'rein, what's the general accuracy
(14:25):
that we see?
And like, how do we think aboutthe in platform metrics and why
is it so important to look atthe offline?
James Patterson (14:32):
Yeah.
So basically the only metricsthat you can guarantee are close
to a hundred percent accurateare going to be your offline
metrics for sure.
Um, the problem is, is that alot of these platforms, right?
It's attribution is going tovary.
We have the changes in, in allof these privacy laws that have
been I'm sure a lot of peopleare aware of at this point,
third party cookies.
(14:53):
I think everybody, even peoplethat aren't in this industry
are, are, are hearing thesethings in the news and whatnot.
Um, the more and more of these,these laws go into place, um,
the, the less and less accuratethese platforms can be at really
telling us if, you know, it's,it's driving, um, you know,
leads or the performance thatkind of we're expecting from it.
(15:14):
making it more critical toreally go through the exercise
of creating a businesswaterfall.
So you can really understandoutside of what's in that
platform, what is actuallyhappening as we're spending
money in these differentchannels, or the case may be to.
Um, you know, help our businessgrow or to our detriment.
Do we need to scale back?
You know, that's, that's alwaysfun too, right?
(15:34):
It's like, we, we see sometimesworking with clients, it's like,
well, actually we're doingreally well and we need to like
take the, take the gas off thefire because we know our metrics
are working so well, so, um,yeah, unfortunately the, the
front facing metrics especiallyare going to get less and less,
um, accurate kind of, as we moveforward.
It makes really.
(15:55):
Being able to tie your backendnumbers to your marketing, you
know, um, strategy overall moreand more critical to really
understand how these platformsare playing into your business
growth and goals for the year.
Anthony Karls (16:07):
So just as like, uh, I know the rule of thumb we
typically talk about hereinternally is the, it's, it's
about 60 to 70 percent accuratewhen we look at an attribution
perspective.
And I think you talked about itreally well, um, as it pertains
to tracking, which is our nexttopic.
So just to like cap offmeasurement.
So why is it so important tolike, if you're going to be
(16:28):
entering paid strategy to, tounderstand this and to invest
in, you know, The connections ofdata for driving revenue.
James Patterson (16:39):
Yeah.
I mean, I think the biggestthing is this is like, you know,
if you're, if you are relying onthese platforms to help grow
your business, You're looking atthe wrong things.
You're, you're more likely tomake a mistake in terms of
evaluating it.
So like understanding thetracking isn't perfect is a big
part of that puzzle is like,Hey, we need to figure out how
(17:00):
we can track this with our owndata, right?
You're at the end of the day,you're, you're the business, you
own the, the customer data toreally tie that back to
understand what's working andwhat's not.
Cause if you rely so closely onwhat's in platform.
You know, it's like I said, you,you could be, you could think
you're really healthy businessand actually, you know, your,
your, your spend or strategy isnot working and driving a return
(17:22):
that's profitable for you.
And to hit your goals this yearor vice versa, you could be
putting caps on things and, andpotentially kind of shooting
yourself in the foot becauseyou're looking at these front
facing metrics or, you know, Idon't think we're getting enough
leads from Google specifically,but what really could be
happening is that maybe Googleis not getting credit for
everything that that it'sdriving.
Um, it's always fun doingexperiments and stuff with
(17:44):
businesses.
Um, being, uh, strikes out as,as an example where, you know,
front facing metrics, we wereseeing things weren't super
strong.
Um, so one day someone justsaid, Hey, why don't we just
turn that thing off?
And, you know, it doesn't reallydo anything.
Well, because we had good accessto the backend numbers, as soon
as we turned that off, all of asudden we saw, we saw something
(18:06):
weird.
We just saw our CPL, uh,continue to increase across our
whole marketing waterfall.
It's like, what's going on here?
All of a sudden we're getting,we're paying more for, for leads
than ever.
And we just took out a bunch ofspend.
We paused a whole channel.
Well, it turned out that yeah,it all goes back to this.
The tracking and attribution isjust not, not all that great.
(18:27):
looking at just the front facingmetrics, you're going to make
Decisions like this, because youdon't truly know if it's, if
it's playing a factor in, inachieving your goals.
And sure enough, um, we put Bingback on and all of a sudden that
CPL went right on back down towhere we wanted it.
So it's, always a fun, funexample to call out.
Cause it's like, yeah, if you,if you stay focused on the
(18:48):
front, you're pro, unless youhave a really strong back,
backend system to really measurethis, like you could be, you
know, causing detriment to your,to your marketing operation.
That was definitely a fun lessonwe learned.
Anthony Karls (19:04):
Uh, so, so if I'm, if I'm working with a
freelancer agency or someoneinternally, how do I know, how
do I know I'm being guidedcorrectly?
Like what should I be lookingfor?
James Patterson (19:17):
Yeah.
I, I would say a big red flag isa lot of what we just talked
about in terms of like, what,what's the data they're bringing
you, like, are they, are theycoming to your, you know,
monthly meetings or whateveryour cadence is or giving you
reports and it's all just frontfacing metrics, like, it's just
like, Hey, we drove this manyleads and it's the conversion
column and Google ads, and thisis the CPL we're getting in, um,
(19:40):
providing insight there.
Um, I would say that would bekind of a red flag to me.
Cause.
Agencies at this point in thegame, knowing all these changes
to data, privacy and stuff, it'slike, this isn't groundbreaking
that, that we really need to tieback marketing performance to
your, your business and thefinancials and understanding
values and things like that.
(20:00):
Cause if you're not doing that,then yeah, it's just finger in
the air.
So that would be a red flag.
I would say a green flag is verymuch the opposite.
If you're coming to a call, likeI always call it out, you know,
Ro we've been talking about rowas.
A lot, a lot of businesses thinkthat's an e com metric.
That is definitely not an e commetric.
That could, that is applicableto any business that exists.
If you're spending money onmarketing costs, you're getting
(20:22):
some revenue from your customeracquisition.
You should, you can tie backrevenue to the costs acquired to
drive leads for your business.
So if they're bringing thingslike that.
Despite you being a leadgeneration business, um, for
example, then I would sayyou're, you're probably working
with a pretty good partner.
Anthony Karls (20:39):
What are some of the questions that will be
asking me?
As the, as the local businessowner, like, what, what should I
expect them to be asking for me?
You're like, they're, they'reasking me for, they're asking me
for information.
I'm like, why are you asking mefor that?
But so like, what are the, Ishould be, I should be
considering as like a good, agood signal that I'm being
managed.
(20:59):
Well,
James Patterson (21:00):
Yes.
So a couple of things.
So timelines, like I talkedabout earlier, plays a big part
in this too.
I would say metrics that theyshould be looking at is leads
your whole business.
Um, categories like we talkedabout.
So you should have some, um, youknow, different differentiation
between a lead, a marketingqualified lead and a sales
(21:21):
qualified lead.
So usually you'd want to see allthree of those metrics if
possible.
And then of course, you know,funded customers or however you
want to say that completedacquisition in terms of, of the
customers coming in.
Um, the timeline piece to the,to this is huge though, too.
So like, if they're like, Hey,we want last month's only.
Um, I think there's a betterversion of that for sure.
(21:41):
We probably want to be lookingat things like up to two years,
maybe even further to really seewhat the pattern is.
Like where, where are you guysat for a business?
Um, that's going to help theagency really plug in and
determine like, Hey, what do weneed to do with our strategy?
To either stop this, you know,maybe negative pattern or on the
opposite side, not play anegative role in a very positive
pattern, for example.
(22:02):
So I really think it'd be those.
And then of course, you know,revenue coming in from, from
those levels from there,generally they can calculate the
different, um, you know, metricsthat they would need.
So like a lead to marketingqualified lead rate.
sales qualified lead rate, uh,you know, value of each of those
different lead statuses andthings like that.
Anthony Karls (22:22):
awesome.
This has been great.
I appreciate it, James.
James Patterson (22:26):
Yeah, it's been fun.
Thanks for having me.
Anthony Karls (22:28):
Yeah.
Thank you for this.
And then we'll, uh, continuepicking up next time.
James Patterson (22:34):
Awesome.
Looking forward to it.
Anthony Karls (22:36):
Thanks.
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