Effective Ads with Paul Rakovich

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let’s play this is George G. And the time is right welcome today’s guest strong and powerful Paul racquetball. Are you ready to do this? Let’s go. Let’s go, John.

Paul is the CEO of clicks and clients. They’re a digital advertising firm. And he’s been doing digital advertising, wait for it before Google even existed. So Paul, excited to have you on, tell us a little bit about your personal life’s more about your work and why you do what you do.

Paul Rakovich 0:42
Sure, thank you so much for having me on. It’s a pleasure to meet you. I’m, the kids have convinced me to take them skiing again today. So we’re up in the mountains.

So it’s a big part of our life’s living here in Colorado, but in between them doing laps, you’re working on a couple of client accounts. So sneaking, sneaking away and having a chat with you. And just kind of a great, a great thought. In terms of the phone calls. Even having this morning, my brother in law started marketing for his business. And that’s like one chat this morning. And then we take a couple apps, and then we’ve got a Facebook client that spends a million dollars a month and we’re trying to figure out, it’s like really sophisticated. Problem issue gray area challenge. And so that’s that’s the morning so far. Nice. That’s, that’s a quite a bit of diversity. I imagine your brother in law is probably not looking to start investing a million dollars a month at this point. Not he gave me his credit card. So we’ll see how far it goes. But

george grombacher 1:40
got it. So what is I mean, how do you even it? Are those two absolute opposite things? Are they closer than then than one might think?

Paul Rakovich 1:52
Yeah, they should. I think they should be closer. So what’s interesting, what I what I see across clients, I would say there’s three tiers. So there’s the budget driven advertiser, and this would be my brother in law initially, where you know, fits. Everyone wants to make money, and they want it to work. And hey, if it works, we’ll spend more like that’s kind of course to given default, that’s almost sometimes something when someone says that that’s almost a little scary. Like, it’s almost a little too wishful thinking. But in his mind, like budget driving, at first, it was, you know, if you can spend $2,000, instead of $3,000, that’s better, I want cheaper leads, we’re on a budget.

And that’s kind of where like, I’d say people tiptoe into this. So initially, for him, it’s,

you know, spend less money. And where I got him kind of to the next step of was, we’re gonna run some ads, we’re going to track phone calls, we’re going to track people inquiring about private charters. So they’ve got this boat in the in the St. Thomas in the Virgin Islands, and St. John’s.

And these charters are like $5,000, a day for charter and day trip kind of thing. And so the first step is we’re going to spend some money, we’re going to see if we can get the phone to ring, get people to fill out the form. And then we’re going to measure what it costs to get that phone to ring. And so he’s kind of on board with that. All right, that makes sense. We can track this, it’s not necessarily just spending a budget. So that’s kind of step two. And step three, where are these big spenders are they’re looking at, you know, I spent 3000, a million, but my brother in law’s case, right, they spent $3,000, we got 30 increase for charters, 10 of those turned into $5,000 trips. And so that’s getting a little more sophisticated, I would say the ultimate sophistication would be if he were to look at it, and say, I got these $5,000 trips, but 30% of these people will come back and book again, you know, once a year, once every two years. And that’s really what these big spenders at the highest level are doing. They’re looking at lifetime value. And so to get a lead, of course, is important to get an initial sale, of course, is important. But what we find a lot of times and these more sophisticated measurements is stuff that seems kind of cheap on the surface, usually is probably pretty cheap, and not great. And sometimes things that are more expensive, on the surface, actually, are better. So, you know, initially we looked at it, he was like these clicks in Google are really expensive. I hear Facebook’s cheap, which is kind of sort of not exactly true. But the Google clicks are more expensive because people are looking for a charter specifically. You know, we know they’re going to spend some money. And so that’s kind of, I think, where the spectrum is across the board.

george grombacher 4:48
Nice. Well, I think that certainly makes sense. That’s that’s a that’s a good way to think about it. So how long? Well, how long have had people been been doing ads on Facebook and Google has been 10 years now has been longer

Paul Rakovich 5:05
initially. So when I got started it was overture, an overture. You put a keyword in, and then you would bid for that specific keyword. And you could find all these little pockets of like misspellings and funny stuff. But basically, if I bid $1, and you bid $2, you would pay $1. One, so you pay a penny more than the person above you. And it was just a matter, sir, below you. So it’s just a matter of like, could you spend the money, then you could have a top spot, and we kind of play this game throughout the day of, you’d bid $2. So then I’d go from $1 to $1.99, to make you pay two bucks, then I’d log back in, and you’d undercut me at $1.98. So then I would be paying two bucks. And it was just this game that didn’t have any real measure quality to it. Just pay pay pay. And it was a lot of fun. And it was kind of silly, but Google really changed the game on the quality side of things. And Facebook’s obviously followed suit as well. And so look at it from like, the impressions, there’s so many impressions, Google wants to maximize impressions, if my ads gonna get clicked on out of 100 times, out of 100 searches 10 times, I’m gonna pay Google 10 bucks, they’re gonna make 100 bucks, if your ads gonna get clicked on two times out of the 100, because your ads not as good that you’re willing to pay 15 or even 20. Google’s gonna show me preferential treatment because your ad isn’t quite as good. So there’s an interesting massaging of quality, quality and price and bid that pays a piece to this. Interesting. Yeah. And over the years, I would say it’s gotten a lot more sophisticated. Google and Facebook are especially before iOS, it was almost getting like, too easy with Facebook, you could just say, target a ton of people that take this action. And Facebook would just by and large figure it out, or a heck of a lot easier than it used to be. So that automation, these data points that we can’t see just writing an ad are certainly way different than where we were back in the day just you know, getting a buck than two bucks on the book and then a buck 50 Then three bucks kind of thing. Got it. It’s gotten exponentially more complicated, I’d say.

george grombacher 7:27
So you mentioned that ads weren’t as good is, is that still a thing?

Paul Rakovich 7:34
I’m certain ad I think the cheap stuff isn’t as good. Maybe that’s the part. I’m thinking of, like a good example. So we have got a client, big spender, and the desktop leads on the surface are more expensive. But when we look a couple of steps down, those leads are worth about 50% more. So someone not looking at that. How those leads turned into actual paying customers would say, desktops more expensive, you know, go to mobile, if they’re even tracking that. So I think what I see a lot is the cheap stuff is cheap, because it’s not very good. And someone’s usually has this figured out in a competitive marketplace. And I feel like there’s a little bit of probably a probably a stupid tax of like, we’ll just pay a bunch. But I think there’s also folks that are pretty savvy and figured out. And we have a water restoration client, those leads are 500 bucks apiece, this clicks are 100 $200 apiece, because your basements flooded. Do Google search, click on it. 200 bucks. You want someone there in an hour? And that’s worth a couple 100 bucks for that click. No question about it.

george grombacher 8:44
Yeah, I’m probably not just casually searching. How do I get water out of water

Paul Rakovich 8:49
history? Yeah. Probably well. Yeah. Even that that would be a difference, right? So if you were searching how to that would be different than like Water Restoration company near me. And so how to search, like, maybe you’re looking for a company, maybe you’re looking for like, where do I place the fans because I spilled, you know, spilled my drink on the floor. So even that might be a differentiator, and the how to search we might pay 1020 bucks for but the companies near me ultra specific. I need someone to show up today. That can be 200 bucks for that just for that click not even a phone call. But just that quick.

george grombacher 9:30
That’s really makes sense. So the click, and then how do you win? How is the phone call part different? does Google know that? They’re taking an action and calling?

Paul Rakovich 9:40
Of course they call? Yeah, of course. Yeah. So either the, the calling directly from the ad, which of course they’re measuring. And then there’s part of that, or they’re going to a landing page or website. And then we’re tracking that with call tech tracking technology as well to figure that out. So Google may or may or may not do that.

george grombacher 10:00
Got it? Yeah, that’s a great question. Which certainly makes sense. So when you’re talking to people, even if it is, we’ll just keep using your brother in law, your brother in law who’s just getting started? Is it a conversation of, yeah, I totally get it, you’re just getting started, you want value, you want to see if this is going to work. But if I can get you to, to broaden your horizon a little bit and stop, not stop, but also to start thinking about, these folks are going to go with you once they’re gonna have such a good experience that they’re also going to buy from you in the future. So this more of this lifetime value? Is that a conversation you’re having with everybody?

Paul Rakovich 10:42
Yeah, I think with him, especially it was let’s see if the phone can ring. Because if we can’t get the phone to ring, and we can’t calculate lifetime value, because it doesn’t even matter. So that’s kind of the first hurdle to get through. And so to me, that’s do we have, there’s a strategy and execution? Right. So do we have the right strategy? Do we have the right keywords? If is that working? And then we run it, are we getting phone calls, they seem decent, let’s take it to the next step. So I did that. And then the other part of it with him was just some realistic expectations, you know, were a really, really good project, I would say, if they’re getting three to five return on adspend. And these are folks that are like tracking, optimizing, you know, they spend 1000 bucks, they know they make 5000, that’s getting pretty good getting past that, like seven, you know, seven, eight, like, you’re doing something really special. And so we talked just from an expectation standpoint of, if you give me three grand, and we get 10, grand and charters, like, that’s pretty awesome, you know, and you’re not going to give me three grand, and you’re probably not going to get $100,000, in charters, like we’re not going to get a 30x return. Let’s not have that. With this, let’s have realistic expectations. The other thing I said was, you know, if the charter is $5,000, we’re probably going to need to spend 10 to $15,000, provided things are set up correctly, right? To get a feel for how this is doing. Because we’re just not going to spend 300 bucks and no get a four $4,000 sale. So some expectations around testing what it’s going to take to get enough information, but also not being wasteful, you know, blowing his budget, pissing off a family member and not being invited to Thanksgiving.

george grombacher 12:31
Right, that’s maybe

Paul Rakovich 12:34
those families are, this can be this can be tricky.

george grombacher 12:37
Evidence that you’re confident in your work that you would take on brother in law.

Paul Rakovich 12:43
Worst case, worst case, it gets a refund, but but also, I looked at the project, I said, I know we can do this, people are looking for these things. And it’ll make sense. So let me just prove to you I can get the phone to ring, then we can get more sophisticated. So

george grombacher 12:56
yeah, I appreciate that. And so managing expectations, three to 5% return, but then it’s also going to take time and money and attention and patience to to do this testing and to figure out what the correct strategy is and then how to actually execute it. You need to understand that going into a relationship like this as well.

Paul Rakovich 13:17
Yep. Yeah, I think even that example of like how to get out of the carpet versus you know, you could spend money on Google AdWords going in putting those keywords in 15 bucks a click, you get no phone calls. $2,000. And it’s like, well, this stunk. And, you know, Paul, and George told me spend some money on it. And now I have and it stinks to that. I think it’s hard starting out. When there’s a strategy issue like that, that’s maybe missing. Same thing on the brother in law, there’s, there’s keywords like boat rentals, and things that are there, they’re close, but they’re just not quite right. And that that could that could tank that could take an account. On the Facebook side of things, the creative is so important that you could have the perfect ad the perfect targeting, but if the creative isn’t rockin, then the account might not work. And so it can be hard when something isn’t working or brand new to keep putting new stuff in putting new stuff in knowing like, am I getting closer to the gold? Or am I going down? You know, a hole that’s has no promise. So I think that’s where those initial like sanity checks of like, let’s just see if we can get some phone calls. And if we’re a week or two in and the phone’s not ringing, and it’s time to kind of reset but but we need to get 3040 50 100 clicks to this before we can even kind of start to think that. So I think that’s the other piece to it too is do get enough clicks to really see if this is to give this a go.

george grombacher 14:50
Yeah, that certainly makes sense. Now, are there certain things that that you see pretty commonly when people come to you and they say, Hey, I want to start running ads. And you say well, let’s see. load down and make sure you’ve sort of gone through and cleaned up some of your processes or systems or first.

Paul Rakovich 15:07
Yeah, I think the, I think the landing page is the easiest place to do. So I think by default, people want to send people to a website. And people just get lost. You know, they’re very add. It’s very, who’s this guy? And what’s George’s website? Where did he go to college, and what’s this other leader, and they just get lost. So I think narrowing it down to one or two objectives, and then having a page on the site that’s dedicated to that is super important. Those, generally speaking, always do better than just the regular website, I’d say the flip side of that is, no one thinks that their team or their staff, like does a bad job handling leads, I would say eight times out of 10, we submit a lead form to a client initially, and, you know, doesn’t get called back for 234 hours to three days. And so that’s another piece of the strategy portion that can completely tank it. So we’ll definitely do test leads to find out is the store manager that even trusted answering this phone like doing their job. And I know you think they are and I know that they’ve been with you for 20 years. Best employee ever but we had a we had a client there a gym client, a gym equipment, client, phone would ring sales guys would hear the whisper that was from Google that hang up on the leads are like, what are these? What are they doing, and we were spending a pretty good amount of money. And they basically wanted someone to walk in the sales room by the primo treadmill, get the warranty, you know, get the commission walk out. And so even just identifying that we said, Alright, we’re going to get these guys we’re gonna create a we’re gonna install a piece of software calls the stores, we’re gonna force them to answer the phone, let alone call leads back, right? Just answer the phone. So we install the software. And the software tells us they’re still not doing it. So the Director of Marketing had to go and kind of a roadshow to train these guys and gals and hold them accountable to just answering the phone, let alone calling the leads back quickly, let alone calling them back more than once. So that process structure, if the lead sit for a long time, if they just get called back once the probably less less than half if if I would say the 25% can be 20% as efficient as it could be just answering the phone, just calling back twice and just calling back quicker. So there are pieces that like we can bring the horse to water, but the clients less to handle and I would say the processing and handling of those leads is rarely handled as well as folks think it is until it’s tested kind of secret shopped. That’s a big piece of the puzzle too.

george grombacher 17:58
Yeah, that’s that’s surprising, but certainly not shocking, that you want to trust but verify that what you expect is happening is actually taking place and you know, in a time where we have every advantage in the world as marketers and to drive sales. You can’t totally replace the whole sales piece. You still have people following up, listen, answering the telephone when it rings, and then actually following up with folks that have

Paul Rakovich 18:29
expressed interest. 100% Yeah, yeah, there’s a study about seven times. There’s a couple different studies out there mortgage leads a lot of data and mortgage very competitive, but only a small percentage of the mortgages are closed on the first attempt, first call the call right away someone answers. It’s not until they get to that 6/7 attempt where you’re getting into most of the deals that end up closing recontacted between the first and the seventh attempt. So that speed are really important in these competitive marketplaces, the Water Restoration folks if the phone’s not answered, like they’re on to the next, you know, forget, you don’t get a second chance. No, I mean, and in fact, we’ve heard a couple of phone calls or the call and they’re like, Yeah, we someone’s already on the way. And that’s it. You’re toast. So got it.

george grombacher 19:18
Paul, people ready for that difference making tip? What do you have for them?

Paul Rakovich 19:23
I think no one’s got it figured out. I think that there’s a lot of best practices. There’s a lot of great stories of when it all works, but I don’t know that anyone completely has it figured out and I think it’s just really nice to know that everyone, each account is different. Each projects a little different. Everyone’s doing the best they can the miraculous stories of million dollars a month. There’s 10 behind it that that struggled. And so I think knowing that that’s a normal part of the process is a big paradigm shift.

george grombacher 19:55
I think that that is great stuff that definitely gets come up. Oh, thank you so much for coming on, where can people learn more about you? How can they engage with clicks and clients? Sure, George.

Paul Rakovich 20:04
So clients at clicks and clients.com or clicks and clients CLI CK S A and B. CLI e n ts.com.

george grombacher 20:17
Have it if you enjoyed as much as I did show, Paul your appreciation and share today’s show with a friend who also appreciates good ideas. Give us the website again, Paul.

Paul Rakovich 20:26
clicks and clients calm.

george grombacher 20:29
Alright. And that’s CLI c ks. andclients.com.

Paul Rakovich 20:36
That’s it. Perfect. Thanks, George. Yeah,

george grombacher 20:39
thank you. And until next time, keep fighting the good fight. We’re all in this together.

Transcribed by https://otter.ai