Aligning Marketing with Business Goals seems like a challenge many companies face. We talk to Andrew Deutsch about how to accomplish this objective, the benefits of a fractional CMO and all things sales and marketing. You can listen to the episode here or look for “Bowties and Business” on your favorite podcast service, Watch on YouTube, and if you haven’t done so already please subscribe to “The Weekly Sales Leader” to get the latest posts, episodes, and special content to make selling a more rewarding and enjoyable profession.
Transcript from Aligning Marketing with Business Goals
Tim Kubiak 0:00
If you ever wondered what your marketing department is doing, the results are driving and whether or not they’re aligned with sales. We talk about all of that today in our conversation with Andrew Deutsch. So stay tuned. And thanks for listening to bow ties in business. Hi, everybody. I’m Tim Kubiak. Thanks for listening to bow ties. And today Andrew George is our guest. He’s a multi lingual, global strategic marketing and sales consultant. He successfully driven business growth in more than 100 countries. His extensive global travel experience, creativity melding strategic business concepts with solid psychological theory. And they’re behind his bold and innovative methods. This company is fangled technologies. It’s a strategic marketing consultancy with services, including fractional Chief Marketing Officer leadership, in depth research beyond the financials for m&a. In addition to total branding, and go to market strategy creation, you could find Andrew at fangled tech.com. Andrew, thanks for being on the show.
Andrew Deutsch 1:08
Thanks so much for having me. I appreciate it.
Tim Kubiak 1:11
So before we jump into everything, can you talk a little bit about fangled tech and how you started?
Andrew Deutsch 1:16
Sure fangled tech is actually the second iteration of my consulting company. I originally began in the early 90s, and had moved the company to Brazil. And when I came back to the States, my company at that time to Deutsch group, someone had already registered my name. So we decided that it was time to not get sued. And, and, and wanted to come up with a name that really said who we were. And the old expression, you know, there’s new fangled and there’s old fangled, we’re, we’re tech right in the moment for marketing and sales, to grow a business. And it’s, you know, when you look at name recognition, nobody forgets that we’re the fangled guys.
Tim Kubiak 1:58
That’s beautiful, that name recognition is huge. And being a marketing, it’s a good play right? Now. So today, we’re going to talk about sort of the benefits of a fractional chief marketing officer. And we’re going to talk about aligning sales, and marketing a little more closely, because it’s an area we’ve seen a lot of companies struggle. So just kind of starting there. If you’re assessing your existing marketing, and you go in, and you’ve helped clients, right, define, redefine or expand what they do. So if someone owns a business, or is leading a marketing organization, where should they started looking at what they’re doing, and whether or not they’re getting their money’s worth?
Andrew Deutsch 2:39
The so many, so many marketing guys will want to set their their performance indicators based on things like how many people can they drive to a website? How many connections do the employees have? How often the blogs of the company, and none of those really matter? If the company isn’t growing, its sales, and it’s brand recognition. And all of the things that actually matter to the bottom line of the company are happening. So you know, I’m fascinated by what I always call the the SEO whiz kids in the market, who come to you and say, Look, you should hire us as a marketing company. We can drive all these people to your website, we can do all of these different things, but you never hear. And we will measure that by how sales grow within your organization. How many leads are generated, they’re actually quality leads that are in your industry or potential customers, that those are the kinds of things that need to be measured.
Tim Kubiak 3:37
How do you start to define those metrics?
Andrew Deutsch 3:41
Well, you have a baseline, what are you doing now? How many, for example, if you’re going to look at metrics in terms of creating campaigns for lead generation, currently, the sales team is getting X number of leads. And of those leads, a certain percentage of them are actually valid. So if we implement a new program for lead gen, and the leads are coming in, we can measure from from the response, how many of those leads are turning into actual pieces of business? If we’re looking at dollars, how many dollars are we in total sales each month compared to the previous year? actual data? Not, you know, fallacy based on on traffic. I don’t know about you. But last year, I went to the supermarket and I tried to pay for my food with likes, they wouldn’t take him. I told him how many connections I had on LinkedIn didn’t matter. They wanted to see how much I had available in my wallet.
Tim Kubiak 4:37
Yeah. Yeah. And that’s actually a really good comparison. Do you think that the crossover is you hear about celebrity culture and the whole social media influencers? And do you think businesses have maybe bought into that, instead of hardcore old school metrics?
Andrew Deutsch 4:54
Absolutely. You know, in a lot of this sort of consumer brand, we’re really what you’re also trying to do is to I’ve awareness of your brand, because there’s so many thousands of consumers who eventually might be there. There’s merit to it. And if you’re a YouTube influencer, the number of people who like and subscribe, determine how much money you can you can get from from what you’re doing. You’re. So it does matter in those spaces. But most of our focus is in the business to business environment, where what we’re looking for is sales, we’re looking for ways of increasing margin, improved profitability, and sales. And, and those other metrics are kind of guidelines, but they’re not the key to growing your business.
Tim Kubiak 5:39
Talking about keys to grow your business? Can you talk about what a fractional cmo is and why you consider one?
Andrew Deutsch 5:45
Absolutely. So most companies in the category that would want a fractional cmo, the fractional cmo is basically a Chief Marketing Officer for your company where you determine how many days a week in terms of the hours that that person is going to put in. So when you get a guy, typically for a small company, let’s say a $10 million, and smaller company, which is really the sweet spot, although we have clients up to 50, and 50 million 80 million also. But when they go out, and they look to hire talent, typically, the budget doesn’t allow for a sea level marketing executive who really understands how to build a strategic plan, should you go to market and those types of things. So so they’ll go to an agency, which is a different topic will have to cover during this time. Or they’ll hire somebody who’s making maybe 60 $70,000 a year because that’s a typical budget. So you’re getting a guy who probably has a good background in tactical marketing, they know for example, how to drive traffic to a website, they have some basic understandings of the tools. But when you really want to build a marketing campaign tools come later. First, you really want to build a strategic plan based on your customer, and what your customer’s needs and desires are and how you differentiate. So when you bring in a fractional cmo, you’re getting a guy First of all, who’s seasoned, who’s got a history of success in moving the needle for companies, and the ability to very quickly evaluate, get involved and make things happen. So the the go to market speed of a fractional cmo is usually two to three times faster with a much better plan than you would ever get by hiring someone with less experience. But the thing to keep in mind with a fractional cmo is eventually the goal is to grow the business to a level that they can hire a seasoned person and take over the role, typically a fractional cmo position that we’re looking for, if we’re with a company for longer than maybe two to three years, there’s probably something wrong in the dynamic, because the goal is to grow the company to a level that they wouldn’t use us. So so one of the key points in terms of what is a fractional cmo is a guy with experience who comes in and immediately is able to dig into the into the situation and determine what the company needs, then they have a pool of the vendors that they would use, who are already pre vetted. And they can control the cost because when you’re hiring, for example, agencies, every time they bring in a vendor, they’re taking their cost, and they’re adding project management, which is a fee, you never know what it’s going to be until you find out at the end of the process. And they’re also up charging. So when you bring in a fractional cmo who’s responsible for the finances, they’re they’re bringing in their pool of talent at a fixed rate that’s already pre negotiated significantly saving the company money. At the end of the day, you get sea level, it what is it the champagne life on a beer budget? Is what with with better performance.
Tim Kubiak 8:52
So you talk about tools coming later. And I’ve seen this in businesses in the last I’ll say 15 years, certainly in the last five, where marketing wants to constantly bring in tools. You know, how do you begin to evaluate the tools you need?
Andrew Deutsch 9:12
To choose the tools you need it there’s the most common sort of metaphor that’s floating around, is if if all you have is a hammer, everything starts to look like a nail. I always joke that if you have a screwdriver, everything was like a screw and trying to screw in a nail. That’s kind of tricky. But but at the core, I don’t know that I want massive traffic to my website unless the strategic plan goes for that. So it really depends if you’re if you’re in that business, the business world, let’s say for example, a capital goods manufacturer, which is a great example, that a company manufactures a piece of high tech equipment that’s used for making a specific component just for lack of a specific industry. So that specific component is only used the Let’s say in aerospace. So now we’ve narrowed it down to that. And in aerospace, that typical component is, is part of an assembly for a wing of a plane. So we now know, a very specific market that we want to go after. So now, what tools? Who are those people in that market? Who are all of those those players that are that are doing that? What what are their specific needs? Who’s Who are the competitors? And what, what are their real pains that exist in the market for getting that component made? And there can be a multiple of answers to those questions. But as you narrow that down, and you start to talk to them, you can really understand who they are, who are the decision makers, what’s the buying process, and then build an actual campaign to reach those people to help solve the problems that they have? Now that we know that we want to do that, what tools do we need to get there? So we’re gonna build, we’re gonna build a stool in the woodshop. What tools do we need to make a stool, if it doesn’t have any round components on it owning a slave is probably not useful. So so we’re going to pick the tools that really will get us to that specific end user. And, and sometimes driving huge web traffic, does nothing more than just flood, the lead gen component to where you spend 90% of your time sorting through to find the gold among the straw. Sometimes, you know, if you’re if you’re if you’re out in a gig where you’re looking to get, you know, people to buy a $20 novelty item, that huge traffic to the website, the old story of the numbers game makes sense, the tools have to fit the strategy, you don’t build the strategy to fit the tool.
Tim Kubiak 11:41
So along that line, on web traffic, since you brought it up a couple of times. So basically, in a business to business sell or capital goods manufacturer sell, buying traffic Pay Per Click right may not be the best strategy. Because you’re going to get cast too wide. And net when you know it’s a VP or director level acquisition, you’d be better targeting, maybe content development or some other means it’s going to draw on people that are truly looking for and have decision making power.
Andrew Deutsch 12:16
Is that fair? Extremely fair. For example, also, if you’re in an industry, where the name of your product could mean different things, I’ll give you an example, I worked for years with a company to manufacture 55 gallon steel drums. So now you’re going to build your pay per click, are you going to pay per click for people to click on drums? Because what’s going to happen is every every guy in a rock and roll band is going to be on your website at your expense. Yeah, so when you’re building those pay per click, depending on the industry you’re in, you got to be really careful as to what it is many times the pay per click campaigns can be more focused on what it is that they want to accomplish, rather than your product. Okay. And again, that’s a whole other Strategic Concept as to whether or not that’s worth it. If if you’re in an industry where you have a relatively low margin on your product or a low, every time you sell, you make 10 bucks, and you’re paying a buck a click. That’s huge. That’s a lot of money. Now, if you’re in a business where you’re selling, you know, million dollar pieces of equipment, you’re paying a buck a click, that’s not so bad. So there’s again, you have to go back to the core and really look at what is your core strategy, and what you’re what you’re going forward with. Because all of that is going to matter in how you’re going to align with your sales team. You’re at the end of the day, who is the marketing team’s customer, it’s the sales guys. If they’re not happy with with the company they’re doing business with, it doesn’t matter how much marketing work you do, they’re going to do their own thing anyhow, and never really grow the business as a team.
Tim Kubiak 13:48
So how do you begin to aligned? C suite exit objectives, right? We want growth, we want more sales, we need marketing to help drive that where does that really start?
Andrew Deutsch 14:02
Well, for example, one one of the big the big bugaboos right now in the market is people who hate their CRM. Yeah, because the sales team sees it as the electronic babysitter that’s making me do 10 times more work. Because who has who designed it, either the IT team or the marketing team without involving the sales team. So so the marketing team needs the information that comes out of that sales team. And they the sales team needs a system that they can document a sale very quickly and keep themselves up to date on what’s happening. So so we do quite a bit of work in designing CRMs around the sales team first, in a way that the marketing team can can pull out the information that they need. So instead of these, most of the CRMs that we’ve installed for are implemented for customers, whether it be Salesforce dynamic, or whichever flavor they go with. A sales guy is able to document his or Her sales visit in in less than a minute or two. Why? Because they have simple dropdowns. They can dictate by voice, get into the system and understand what’s going on. The sales teams love them because the marketing team builds in reminder systems and automation. So and I’ll give you an example one that I use years ago, I had a massive customer in Venezuela, we were doing a million dollar equipment sale, I had been traveling, I got back and there was an alert saying, hey, you didn’t follow up on this. I picked up the phone, I called down to Venezuela. And sure enough, they were making the decision the next day and needed one more piece of information from me, and hadn’t contacted me, we got the deal. If it hadn’t been for the automation built into that thing, my irresponsibility of not following up, would have cost me a massive deal. By the way, it was a million dollar piece of equipment that consumed half a million dollars in in material every year. And it wouldn’t have happened. So I love the CRM, why because it acted as is having my own virtual assistant. So So when the marketing team gets with the sales team and understand what do you guys really need? So something that’ll come out of the sales team, hey, when I send a quote, is there a way for this thing to remind me in 48 hours? And can I adjust it, can it have a default, because I typically follow up in two days. So now they have that built in because the sales team side at the same time, as campaigns are happening, the marketing team can keep up. So let’s say we’ve got a product launch, we’re launching product x, and the sales team is going to go out to every customer and talk about the new product launch x, we can create for them, not only the materials based on the research that we did to our customers as to what really matters about x and how x solves their problems. But we also can track and make sure that every time somebody has a contact and otherwise we get the feedback so that we can adjust for the future. Same same concept with you know is your is you’re looking at the CRM for the sales guys. How are they going to be alerted? You know what there’s that one customer I forgot about the marketing team with the sales team can set up and say, You know what, we’ve discovered that when we contact a customer at least once every 90 days, we’re able to keep the competitors out, we’re able to do it. So we can set up a system so that the sales manager can look at a heat map of the territory and see what’s going on. So now the sales manager instead of saying to the sales guy, what’s going on in your territory, it’s Hey, you your pipeline is looking for this type of information, whether it’s it’s new leads, or conversions, or whatever. And I’m noticing on the map that you haven’t been to Pittsburgh, where you have three clients, you haven’t talked to those guys 120 days, maybe that’s so that there’s it can create that whole coaching thing, because the marketing teams work with sales to make that happen. So
Tim Kubiak 17:56
all of that is funny, I’ve deployed a bunch of MRP systems have deployed a bunch of CRM systems, some of the major brands, some smaller ones. And marketing has never been at the table, to have those kind of conversations.
Andrew Deutsch 18:11
It’s the guys who who best understand who knows the customer, or the sales guys. Yep, the guys who have dug in deep and understood because they’ve interviewed those customers, and really looked at their needs beyond what the sales team is the marketing team. And that voice of customer is the core. I’ll give you an example in the drum industry. One, one of the companies that we dealt with, they were out marketing, that they used American steel, they can do all of their testing in house for D o t, which is you have to drop test to make sure the drones are going to not let those chemicals get into the, into places they shouldn’t be besides inside the drone. And, and all of these things. And when we went back and did the voice of customer, why do you do business with this company? And we asked these questions. You know what, none of that was important to the customer. What was important to the customer was number one, when we call your company, you guys answered the phone, your competitors Don’t I know my salesman and can get him anytime. I’ve waited as much as two weeks for the competitor salespeople to contact me. Number three, and this was a big one was you know what, sometimes we get we get a run on a product and we need drums. We wait a month to two months with a competitor. You guys have this flexible manufacturing, you get it to me within a week. It’s incredible. And by the way, when you guys screw up, which they did, and we have a defective product, you you’re responsible for it and replace it immediately. It’s no I don’t have a headache. So that became the reason to do business with this company, not because they were making this product everybody else saw as a commodity.
Tim Kubiak 19:51
That’s and that’s the kind of insight companies often lack. Right? I think too often companies go into theoretical, instead of actually I don’t Understanding truly what the customer wants and needs.
Andrew Deutsch 20:02
Yeah, imagine you just you’re going to buy a new cartoon. And the salesman says, you’re really gonna like this model, because we make it out of steel, it’s got four, four tires, it’s got a steering wheel, and glass windows,
Tim Kubiak 20:15
you’re gonna love it.
Andrew Deutsch 20:17
Well, that’s, that’s the misalignment between what the customer really wants and what that sales guy seemed to think they want. The marketing team is the is the guys that go out and really figure out at the core, what what are these customers problems that we can solve? What What differentiates us from the competition? And how do you bring all that together? So that the sales team has the best pitch in the world as they’re out listening? And, and dealing with, with those issues, knowing the right probing questions to get to the core, and assuring them that we’re the guys that can solve their problems that were the guys was stuff to buy?
Tim Kubiak 20:54
Yeah. If I can circle back, sure. In your introduction on the benefits of a fractional cmo, right, one of the things you talked about is how agencies act versus having a person with experience in their own list of vendors. Can you talk about the kind of things because so often, I think small business owners, medium sized business owners think they’re going to hire, whether it’s at $60,000 a year or $80,000, a year person right out of school, or somebody even as an internal marketing director, they think they’re going to be able to do everything. And the truth is that skill sets not a single person.
Andrew Deutsch 21:33
Yeah, I’ve even seen it where they don’t hire the marketing guy, because he doesn’t have a graphics background. Yeah. And it’s kind of like, you know, if, if, if you want a guy to do graphics, first of all, it’s not a full time job. Typically, in most companies, unless you’re really paper intensive that everything needs associate or otherwise, what the difference between having a fractional cmo and an agency, let’s let’s go back, typically, and there are some great agencies out there. So don’t, I’m not anti agency. But the typical scenario is an agency will tell you that they have experience in your industry, and chances are they don’t. So they have they have employees within within the facility, who are probably very skilled at what they do, they typically have a guy who does graphic layout, they got a guy who, who has some expertise in branding, but not across the board. They’ll have a guy who is really good at maybe implementing CRMs, building websites, those types of things. But you’re, you’re typically looking when you go to an agency that they’re going to want to use their internal people first, before they would look outside. Typically, a fractional cmo has a pool of an eye in my case, there’s 92 different guys that we can go to depending on the project. We don’t fit the fastener to the tool, we look for the tool that fits exactly what your need is. So, so an example that and this is this is an extreme example, but I know that it happened. Company, so yeah, we’re experts in b2b marketing. Most of their clients were lawyers, doctors and dentists. That’s who they had been marketing to. And someone came to him. So immediately, they said, Oh, yeah, we’ve done lots of b2b. And we can help you sell your machinery. But what did they do, they went and talked to these guys and houses that we got to figure this thing out, you guys got to do some research, rather than what we would have done, which is going to our key b2b marketing teams that have done and understand that commercial space for industry, and how to build that. The other thing is, agencies typically have huge overhead, they’ve got the fancy conference room, they’ve got real estate, they have their own their own internal types of things going on that have costs including employee salaries, fractional CMOS, we grow and shrink based on the projects that we’re doing. So at the end of the day, we’re fully responsible and we own the strategic output and and the KPIs and what what we intend to do for the customer. But we have this this great pool of French freelancers that we reach out to, and build a team specific to your need. You know, if you’re if you’re going to have a brain surgery, you want the proper you don’t want just any nurse in the you want a nurse who’s done neurology. You want a surgeon who’s done lots of brain surgery, and and you want the proper suite to go into one office, the same thing with with the marketing team, I will only put together people who are specific to that industry, or in full transparency, say, you know what, we’ve got someone similar. So there’s going to be a little bit of a lag until we get that guy up to speed to understand your industry.
Tim Kubiak 24:46
And that’s part of how you manage scope, creep and cost creep.
Andrew Deutsch 24:50
Yes, that’s that’s the other part that the kind of the ugly story about agency. We because we’re the fractional cmo, we’re actually part of the team project. management of the total project is what we do. Whereas I’ve seen projects where you know it, we’re looking at $10,000 to build a new piece of your website, the collateral materials, and look at designing your tradeshow booth. And it’s agreed on, plus project management. And then at the end of the project, you can wait a minute, there’s over $10,000 in project management. Oh, yeah, well, it took a lot of time to coordinate. And here by the way, here’s the hours booked. So you owe us that? Well, with with a fractional cmo, the the cost is built in because you’re paying for that much time a week. And there’s no there’s no fudge factor. Nor should there be. And the other thing with a fractional cmo is eventually Our goal is to get the company to grow to such a level that they don’t need us anymore. We try to become obsolete. Because if we do that we’ve been successful. And we leverage that on to the next project that we do. Because we build our business on our past successes. Whereas most most agencies are kind of like interior decorators, that once once they get ahold of you, every lamp every ashtray means money. And and and as soon as you finish getting that beautiful living room, it’s a Tim that bedroom could use a little refresh, don’t you think?
That isn’t, that isn’t how we operate.
Tim Kubiak 26:20
So if you look at that, a big part of this is tying back actual ROI, right, everybody loves metrics, you’ve talked about CRM, how do you start to tie back ROI or even measure what you’ve already spent on?
Andrew Deutsch 26:40
it the the, what they’ve already spent part typically becomes a complex conversation. Because typically, we end up being brought on board after somebody has been burned. In I would I, I don’t know the exact metric, I’m going to, I’m going to guess 85% 90% of the times that I’ve been brought in, it’s been after a disaster or close to disaster from from previous previous consultant, previous agency previous otherwise. So what we what we tried to do when we come in is benchmark, where were you over the past, maybe depending on the on the company the past three years, and and chart it, and then set the goals of where we want to be. And then we can we can compare as we’re growing, because of the experience that my team of freelancers that I use, and the experience that we have, typically worth four or five times faster than hiring a new guy, to be able to get a company, there’s a certain level of intuition that you grow with being experienced in a business, where, you know, it’s kind of like you go to the old school doctor, and he looks at you, and he already knows what’s wrong with you. And then he does the exams to back it up. So with our experienced team, we really can dig in much quicker than than a new hire, and get the ball rolling faster. Because we’ve already vetted and we know who all the vendors are that we’re going to use, we don’t have that whole month of going out for bid and waiting and evaluating and then having second and third, we can really dig in and build the budget right away and get going. So all of that sort of sort of speeds up. And then the ROI at the end of the day. What was the goal? We wanted to grow the business by 20%? Did we do it?
Tim Kubiak 28:22
Yeah. I don’t know. It’s straight math. Right? That’s Yeah.
Andrew Deutsch 28:26
Yeah. And and, you know, having if if a company wants the goal to be, we’re looking for you to drive 100,000 people to our website, and I want to be able to leverage my LinkedIn to have 30,000 connections, that kind of stuff. We know who to refer that to. Because that isn’t that isn’t that isn’t the core goal, we we want to see results in terms of how your business grows, not in terms of how your ego grows.
Tim Kubiak 28:50
Right? Yeah. And there is that whole huge piece with that. So marketing, in today’s world is different. And you have a global background. So how do you have to? or How can you help guide a company? who’s dealing maybe multiple languages, multiple countries within a territory, leaving a territory? Maybe they’ve been wildly successful in the US and they’re looking to expand into Latin America or Europe?
Andrew Deutsch 29:21
Yeah, I mean, that’s really the sweet spot of what we do. I personally have sold into over 100 and 160 countries. In my career, at one time, I was selling 75 countries at the same time. I was about 300,000 air miles 45 countries a year traveling and and growing. Back in those days marketing in the b2b world was sell sheets catalogs and and you know, the occasional sample. That was that was what it was and it was really ineffective. It worked because there was no other alternative. Now we’ve got this rich bag of tools with video conferencing the the amount of wasted Company dollars on travel every year could be reduced significantly with things like this on zoom and other types of visual meetings, the trade show was the key to growing global business at the time. Now not so much. The I remember, like, for example, the newspaper industry, one of the companies I worked with, we sold to the newspaper industry, at one time, the entire McCormick Place in Chicago, all the halls were filled. Now, I think the newspaper industry trade shows in a hotel ballroom somewhere. So So things have changed that way. But the ability to dig in, and understand the customer hasn’t changed. If you’re a guy who can sit down and ask prepared, do your investigating, and ask those probing questions, and know how to dig in to understand where are the pains and the challenges that your customer has, and align that with what your products can do to resolve those, it doesn’t matter what part of the world you’re in. And the language barrier also, I mean, there didn’t used to be translation programs. I personally can can speak in several different languages. But most, most people in this country, they want to do business first when they speak English because they’re nervous. And they don’t they don’t have the capabilities. So, you know, you would started an engagement, say back in the in the early 90s, with a company that wants to grow their global footprint and go Hey, where are you currently doing business? Oh, we do business in England, Australia. And we’re in Canada. And we got a guy who works for us that that bilingual, so we’re starting to sell him to Mexico. And you go, what evaluation? Have you done? So Well, you know, these are these are people that we had access to, by the way we’re bringing on this guy in Saudi Arabia, because they got a guy that who can speak English with us. So we’re gonna be we’re gonna be the Middle East. And then the other was, because they didn’t travel and they didn’t know how to evaluate. They would have a guy in a country who’s doing absolutely nothing that they gave exclusivity to. Yep. And they will What the heck, well, that guy not only has exclusivity, but because they don’t understand the legal ramifications. He’s registered the name of your company in that country, and he owns it. Yep. So if you fire him, you can’t sell there. Yep, you’re stuck. And then you go to a trade show. And I won’t say the name of the country. But most people who do international are going to get why this is funny. You’ll be at your booth. And you’ve got your demo set up. And the first guy comes up to you and he’ll say, Hey, I’m the number one distributor of this product in my country, and nobody comes close to me. And you shake his hand and you take his business card, and you’re going to get in touch with him after the show. As he’s walking away, another guy from the same country comes up. I’m number one in my country. By the end of the day, you’ll have met 12 number ones. Yes, I think there’s just an incredible scientific breakthrough.
Tim Kubiak 32:53
It knows the algorithm on who’s really number one, though.
Andrew Deutsch 32:58
the only it’s the only thing in the world where you can have multiple number ones, well, all of that kind of chaotic stuff that I just went through. filter down is why people hire us to help them build their global footprint. Because we we’ve had the experience of how to do it and speed it up and get past the pitfalls, and make it an effective strategic move, as opposed to the way that most companies did it, which is basically we go where they speak English. We go where people reached out to us, and then we brag about it. And hope that that takes us somewhere else.
Tim Kubiak 33:34
You talk about simplifying that complexity. How has gpdr and privacy regulations and other theaters affected? What folks like you do in general?
Andrew Deutsch 33:49
It hasn’t. Okay. I I don’t know that we’ve made any changes based on that the one thing that we you know, kind of aside from that is the number one killer of international trade for American companies is believing in exclusivity. Having having exclusive players until there’s Intel it’s the right thing to do. Yeah. And and also that the having the right team members on board in those different places and being flexible, because what works here doesn’t work there. Correct. For example, in distribution, because of the the complexity of tax structures. If you’re, I’ll give you an example. But we had a customer of course, this is years before before Chavez actually stole our customer and nationalized it. We were unable to sell our products through our distributor in high volume because of the tax structure. So the distributor would import a full full container, nationalize it, add their margin and then sell it to the end user we were priced out of the market. So we created what i what i coin hybrid distribution where every distributor is also amazing. effectors wrap. So what would happen now is they would go to that end user, and they would sell direct as it as a represent representative of our company. And we would sell directly to them Commission, the the rep, and be able to avoid the double tax increase it was going on within within the process. And it’s completely transparent. There’s no there’s no, there’s nothing unethical or otherwise about it. But what it allowed us to do was best all of the competitors, because we could, we could have the quality product at a competitive price without sacrificing margin, and serve the customer because any issues they had, they had our rep right there in town. And by the way, the distributor would stock a little Overstock. So if they ran out at a premium they could get, they could get rolls. So it was a completely different take on how to grow business. And it, it took the company from when I took on, I want to say that these numbers might not be accurate anymore, because I’m It’s been a long time. But I think that they were doing around for 4.2 million in 16 countries. And within five years we were doing I think it was 11 point 8 million in 75 countries through our distribution.
Tim Kubiak 36:19
So just because I’ve got global background, did you have to create operating companies in each of those countries?
Andrew Deutsch 36:25
never you you find local partners, local trade partners in your area that want to grow their business with your product, and you coach them on how to do that I had to do that. And it’s unique in each country. There’s not a need for that we had one employee that we found this really brilliant guy that I came across in Mexico, that became our manufacturer’s rep for the for the country. And he and he eventually got so good that we added in some of Central America for his for his category, the guy just just blew the doors off of the industry down there. But no, you don’t. Unless Unless you feel like there’s enough market in a country where you would want to use that as a basis for growth. I, I don’t see the reason to have to set up an entity in every one of those countries. You can do everything from here. And it’s significantly more cost effective.
Tim Kubiak 37:22
Cost effective. Yeah. So one of the things I’ve run into is reclassification, at the borders, by customs agents of goods coming into the country. And one thing I think a lot of Americans don’t think about global businesses, the temptation to not hold inventory there, because I won’t say what governments but some governments feel the need to seize private inventories. And it’s relatively random. And I think when you say that’s an American, that used to having, you know, a warehouse in New Jersey, one in Atlanta, one in Texas, right, and you say, What do you mean, it’s going to take two weeks to get there four weeks to get the goods in the country without customs. And explaining that risk? I think that’s a tough conversation to have, with people looking to expand.
Andrew Deutsch 38:13
It’s a country by country conversation. Yes. And that’s the part that that there are countries. And the same note, for example, one of one of the countries where I’ve always sold this sort of way. Well, if I didn’t plan my trip to Morocco, where it was a stop off on my way to Argentina, it was never, it would never be within the budget to visit or away. And the reason being that sometimes the cost to get there and back is more than what the profit would be for the year and doing business there until you establish enough market yet. So that’s existing, but the reason you want local people and not you in those markets, who are responsible for those goods, when they arrive, they can choose what they need to inventory what they don’t they understand their market better than we do. The problem is that there’s this idea of you know, the we’re number one, we’re number one, as a country that somehow we know better than they do in their own country. And as soon as you get that out of your head, you can be successful. Yeah, I lived in Brazil for 10 years. And I would get in arguments, literal arguments with people here in the US telling me how the taxes work in Brazil. I’m like, I I paid them for 10 years on my company. I know how the import, oh, there’s no way that that can be. And it’s kind of like, I don’t know, you know, here’s documents from the from our government explaining how it works. Here it is in Portuguese, I can translate it for you. And they just don’t want to believe that it’s true. It’s a very complicated market. But if you’re local, and you understand how it works, it’s just how you do business. And by the way, if we have to pay those taxes, you know, the importer, so does our competitor, right? It’s not it’s it’s not you know, we’re all on the same level playing field when it comes to how it works. Because this concept of you know, that somehow there’s grift, and Brian And those things that change things. It really isn’t the case. Yeah, it’s not. I’m sure it happens often on but in big, big companies in places like Brazil don’t do that.
Tim Kubiak 40:11
Yeah, yeah. I, I’ve seen issues and some of the former Soviet things. Right. And that’s the other thing is telling Americans, as they decide to go to market elsewhere have to look at export compliance in a way that they’re probably, you know, my, my joke is, you could ship it from New Jersey to Ohio, and nobody cares. What if you ship it from Germany to x country in we can pick on Poland, the rules are very, very different, because we don’t want no specific rules outside of the EU for certain types of technologies.
Andrew Deutsch 40:45
Yeah, at the end of the day, if you’re a guy who thrives on taking shortcuts, you don’t want to be in global trade. Yeah. It’s as simple as that if that’s exactly
Tim Kubiak 40:55
Andrew Deutsch 40:56
Yeah. The the American adage, I got a guy, I got a guy who can handle that. Yeah. Not highly recommended when you’re dealing in multiple countries with multiple different political structures and different business environments. Yeah,
Tim Kubiak 41:09
yeah. Yeah. Do you find with global clients that the marketing budgets follow the country? Or do they tend to be centralized? In everything?
Andrew Deutsch 41:21
Yeah, it’s all over the board. And that’s why the global market so interesting to me, is that the very things that made me successful, for example, in Taiwan,
none of them worked in the
Philippines. It’s a very different market, different mindset, different culture. And, and they’re very different different people, that actually people in the Philippines are much more aligned with American thinking, than the Taiwanese are. So so a lot of a lot of the kind of strategies that we would use in the US are more functional there were in Taiwan, they could be insulting. Okay, so it’s, it comes from the savvy of knowing over time, and, and building slowly and carefully, not just going let’s go global. Right, you evaluate the same way you do with leads? What what are the countries that that fit within the model of an industry that could use our products? What are their needs? What’s the competitive landscape? When we get there? Who are we playing against? And there are times where you look at you go, you know, what, we don’t have a competitive advantage there. So unless somebody wants to brag that they’re buying a US product, chances are, we’re never going to be very successful. The bigger companies look at that and go, Well, this other player is winning, let’s buy them and write it that way. But most of most of my clients are not the I need to buy my competition level companies, there are companies that can beat the competition through savvy business.
Tim Kubiak 42:49
So talk about this talk about what’s a good size client, for somebody like you, you know, who should be thinking about, you know, size wise, is it employees? Is it marketing dollars spent? Is it total revenues?
Andrew Deutsch 43:02
I typically the base first we look at the revenue, if a company is is is between one and 30 million, chances are, we’re got about a 75 80% chance that we could be a right fit, when they go from that 10 to 50 million that drops a little bit by bit, you know, maybe down to 50%. And then above that, that 50, to 8050, to 100 million sort of sort of category, we’re good for many, but not all, that the other. Our other client, though, is also like a private equity or bought a company, and they need someone to come in after acquisition to completely straighten out the sales and marketing as part of, and we don’t use the word turnaround in those cases, it’s, it’s about the jumpstart of the marketing and sales for that company really digging in and looking. But we also do, and we don’t put it on the website, because it gets a little confusing for people. But we do what I call PE forensics. So a private equity group or a company is looking to acquire another company. And we’re able to with with some some interesting skills that we’ve developed over the years, we can investigate all the intangibles of that company in a way that the employees aren’t alerted that the company’s for sale. And we basically have three findings, one of three, one, this is going to be a good acquisition for you. Everything is as shown. Number two, jump on it right away, don’t let it get away because there’s huge upside that this company doesn’t even know they have. And I can give you an example of that. There was a company that made a specific product for that they were selling to Coca Cola for transport. And when we asked the sales guy who’s been there for 40 years, why why aren’t you selling to Pepsi or Dr. Pepper Snapple and these other guys and the response was, well, they haven’t reached out to us. We buy that company and get rid of him. Because there’s huge upside Matter of fact, the purchase was made and it was huge. It grew the company. I mean exponentially in the first couple of years. And then the third is runaway, don’t buy or be prepared. For example, we found a company where the head of quality was a massive racist. And they were probably going to be eight to 10 lawsuits coming down the pike, we found a company where they were making a specialty component in the stamping process for high heat environments. And there was a polymer coming down the pike, that was a third the cost, and they were already into all of this company’s customers. And chances were within six months, they would lose all of their base customers. And that actually happened. So there is a company where you discover that the key players of that company, as soon as it’s bought are going to go somewhere else. So you’re going to buy a shell, those types of things we discover, and then then decisions can be made based on those recommendations as we score those companies. So So and those typically those can be any size company, they don’t, those those don’t fall into that category of where sweet spot is for fractional cmo.
Tim Kubiak 46:07
So would they bring you in prior to offer would they bring you in, during the final due diligence?
Andrew Deutsch 46:15
typically, when they’re close to the end of the due diligence process, and they have doubts were brought in. And the beauty of it too, is because of the research that we do. When the acquisition occurs, if they buy, we already have the framework of go to market strategy, and the day one launch well in hand, so that first three to six months of discovery that they usually do before they can take action with a new company. Yeah, we’ve already got a plan in place. So so the speed to growth is accelerated significantly and much less time. In reality, why? why did why do PE groups buy companies, they buy them, because they’re there, they’re successful companies they can take to the next level, and within a specific time period, sell it to the next level purchase. That’s why they’re doing it. Well, what would happen if we could take three to six months out of that loop and get it done even faster? That’s a powerful, that’s a powerful tool.
Tim Kubiak 47:10
That’s a powerful tool. If I was, I’m just thinking on the fly here, if I’m buying somebody to expand my territory, expand my product set, even if I’m not a PE company, but I’m planning to grow through acquisition, I could use your services in much the same way. Can
Andrew Deutsch 47:27
We do that all the time yet? Yeah. And and, you know, day one, you know, which guys are really going to be a great integral part of your team. And and which guys may be able to seek a better career somewhere else? Yeah, you’ll be able to see what the alignment is, do you have the right people in the right places? How can I reassign duties and responsibilities to actually be more powerful, all of that can be done prior to the acquisition instead of having to follow through with that post.
Tim Kubiak 47:55
Yeah, and one of the things I’ve seen in my career is people that don’t do a lot of m&a. Right, they’ve got a business broker on one or both sides of the equation are cashing in on it, but they’re not really giving you impartial advice, their job is to help your buyer help you solve business about
Andrew Deutsch 48:12
Yeah, you know, we’re affiliated with a group called exit your way. And, and these guys are brilliant, what they’ve done is they’ve created a program where they go to companies before the exit three to five years before somebody is wanting to sell their company. And we build up a basically a board of directors that go in and help take that company, not just to the next level, but also in an organized way that’s truly appealing to buyers. So for example, a company that say a $5 million company today, and they’re going to go to market and sell their business, what would happen if within three years, our team was able to take them to 10 or 15. And we have examples of where the group has done that. And typically, when people are doing that, they only think about the financial, how do I fix my books to make the company look this way? rather than how do we actually build the company. So that it truly is what it needs to be at that next level. There’s even a few cases where we grew the business so well, that they decided not to sell. They Oh my god, it’s become such a profitable thing. Maybe you know, someone else in my family I want to take over. But, you know, if you want to maximize your most people, you know, the business that they started is their baby. And when they when they sell it, they want to make sure that they get the total maximum, you know, their baby’s going to meet the perfect suitor for the wedding. Yep. And bring maximum benefit to the owner. So it’s it’s similar except that it’s not just us doing the marketing and sales. It’s really savvy operations people savvy, financial people all coming together to build a plan to get that company where it needs to be to get the maximum out.
Tim Kubiak 49:51
Very nice. Andrew, what should I have asked you that I didn’t
Andrew Deutsch 49:58
I don’t know. Probably, you know, at the core, one of the things that typically comes up in the conversation about what makes the the issue between the alignment of sales and marketing. And why is it always seemed like there’s a battle between the two departments? Yeah, I was gonna say, if you’re gonna ask me something, it would be, you know, how do you truly align sales and marketing? And my first my first response to that is simple. They have to have the same goals.
Marketing doesn’t get rewarded unless sales increase
Tim Kubiak 50:33
it that’s why that’s bold.
Andrew Deutsch 50:36
Yeah, you know, to go to the board and say, like I said, earlier, I drew drove for 100,000 people to the website. We had great brand recognition, all of these kinds of things that the marketing guys are always talking about, that it results in sales. Well, no, but eventually it will. Yeah, sorry, you haven’t met your goals. If the sales team doesn’t love you, and they’re not growing business because of the work that you’re doing? You’re basically just doing aesthetics.
Tim Kubiak 51:02
Yeah. It’s funny, I’ve been on the other side of that conversation as a sales letter where people were like, well, sales didn’t put more people in our marketing database. They didn’t do this. They didn’t do that. And I’m like, What are you gonna send them? Right at the at the end of the day? That’s great names or names, but other than names, you know, what are they gonna buy? What are you gonna? What’s the messaging? Don’t talking about, you know, click through rate and open rate and all that stuff. Just because you need more people? Oh,
Andrew Deutsch 51:31
If at the end of the day, what’s in it for me?
Tim Kubiak 51:35
Yeah, exactly. I get I usually buy. I got paid on either, right. If it doesn’t grow even up? I don’t care. Yeah. Lucky, simple.
Andrew Deutsch 51:44
Yeah, you can, you can have the most beautiful party set up in your backyard with a band and everything. But if there’s no invites, it isn’t quite such a great party is you’re walking around with your one one drink in hand wondering where all the guests are.
Tim Kubiak 52:00
I may or may not have showed up to some road shows where eight people showed up for rooms stack for a cup laundered. So I know that feeling. That’s
Andrew Deutsch 52:08
By the way, that’s only happened to you. No one else.
Tim Kubiak 52:11
Never, never. And just thank you so much for your time. Again, you can find Andrew and his company at fangled tech Comm. We’ll have links in the show notes. And yeah, maybe we’ll catch up again soon.
Andrew Deutsch 52:27
Absolutely. Thanks so much for having me on. I really enjoyed it.
Tim Kubiak 52:29
It’s been a pleasure. Thanks again to Andrew for being on the show. Of course, you can find him at fangled tech. You like what you heard, please subscribe to us, tell your friends. You can also find us on our socials at bow ties in business on Facebook and Instagram and bow ties in biz on Twitter. As always, you can find me at Tim Kubiak on Twitter Tim kubiak.com