From Dell to Magnets: Small Business SEM Interview
Andrew Carpentier is the CEO and owner of Rochester Magnet, a client of mine for almost a year (one of our many Rochester friends). Andrew stepped away from his career at Dell Computers (and other large companies) and set out to buy a small business in dire need of a marketing overhaul. He found it in Rochester Magnet and this is his story.
HubShout: Tell us about your background at Dell and how it prepared you for being a small business owner.
Andrew Carpentier: I had various roles during my time at Dell including finance, marketing, operations, and product line management. My last role was senior manager of Dell.com Home and Small Business ecommerce. Dell was a great place to learn many different disciplines very quickly. It was a focused boot camp where each quarter of experience there was like a year at any other company. I was able to gain experience in a lot of areas, particularly the importance of process and metrics, that would later help me as a small business owner. My experience there taught me to define the process so things are predictable and repeatable, measure the right things so you’re sure you’re moving in the right direction and have a disaster recovery plan. All those things are critical to successfully running a small business.
HubShout: What was your motivation for leaving?
Carpentier: I loved being at Dell and wouldn’t be in this position today without that experience. I wanted to be out on my own, responsible for my own decisions, on the forefront of what’s happening. There is a certain amount of corporate bureaucracy like “powerpoint pitches” that I wanted to get away from. I wanted to get back to the world where everyone counts. I was enamored by the idea that, in a small business, every oar being rowed on a small boat has an impact.
HubShout: What was the profile of the business you were looking to acquire?
Carpentier: I knew I didn’t want a start-up or a business with a razor thin profit or in a dying market. I was looking for a B2B business with an existing cash flow in manufacturing or distribution. Ideally, the business would be one where the existing owner hadn’t optimized every part of the business so that I could bring my skills to the organization and increase growth.
HubShout: How much was “online marketing” on your mind when you started thinking about marketing your new business?
Carpentier: Quite a bit when I bought the company. We had a basic website that was essentially an online brochure. We thought about how to scale our resources -- should we do trade shows? Print magazines? Trade magazines? Internet? The obvious solution was the Internet and especially Google. We are a national and international business and I knew Search would be the most scalable way for us to reach new customers.
HubShout: What was the state of online marketing at the business when you acquired it?
Carpentier: The company had a PPC campaign that had been discontinued about 6 months before I took over. True analysis was not in place to determine if the campaign was successful or if leads were coming from PPC. The thought was that any growth was coming from referrals and word of mouth. Very little had been done to track website activity and analytics hadn’t been set up.
HubShout: So you’ve got your business, and you’re clearly thinking about online marketing. What were your concerns around SEM on day one?
Carpentier: Magnets are a broad category, and some of the search terms are very broad. We make a ton of different types of magnets. I didn’t know if we would be able to focus on the right terms to attract the right customers. I was, obviously, worried about cost too. I didn’t want to sink a huge sum of money into online marketing for this new venture and see the financials deteriorate.
HubShout: Was it fear around the size of the investment needed or fear about whether the SEM would work at all?
Carpentier: Worries about investment. What can we really get from PPC? Is it going to be a huge mountain to climb? Is this going to work? SEO seems attractive, but how long will it take? Can I wait that long? What if the only good leads come from PPC?
HubShout: When you looked at the opportunities to ramp up marketing, were they the same you thought they would be when you bought the business?
Carpentier: I was lucky that the due diligence and openness of the prior owner gave me the insight that I needed. I had access to the current employees prior to close. I didn’t find any “skeletons” in the closet. I had a fairly realistic view of where things were and knew where I needed to go.
HubShout: Was there any tracking setup? (Analytics, Adwords Goals, Leads)?
Carpentier: They did not have analytics on the website. PPC had been tried and turned off. I had very little data. Sales lead data was slightly available based on the number of emails that came in, but was not tracked in any systematic way.
HubShout: Was there a CRM solution in use for tracking sales leads through the funnel?
Carpentier: No, no CRM. The process was: get an email and call the guy to figure out what he needs. The follow-up process was not formal so I was always worried that it wasn’t happening. I really like same-day follow-up. I had to put in some spreadsheets to help this along about a week after buying the company.
HubShout: Reflecting on previous experience at Dell managing by metrics, how does the small business experience compare to the experience at Dell? What things are different?
Carpentier: Things translate pretty well. At Dell, we used scorecard dashboards metrics. Sometimes at Dell I questioned the value of all the metrics because there were so many. In a small business you use a sub-set, and it tends to be what really matters because there is no margin for error. It really helps to have metrics that turn into actionable data. Over the last year, we have identified the important metrics and defined the sales funnel. I had to figure out the steps required to get customers to the next gate in the funnel. Along with the CRM, we also have a new phone system. I have the controls that I had at a Dell call center now in a small business phone system.
HubShout: As you moved into SEM what were your biggest concerns? It seems you had initial skepticism about PPC. Why?
Carpentier: Having grown up in the Dell world, the perception was that organic search is more credible. Lesser companies can buy terms; real companies optimize for them. I can buy one of your key terms and funnel traffic to my site. There’s a credibility piece; a perception that more benefit would come from SEO. I’m not entirely sure that is true, but it seemed that way.
HubShout: A year later, having done SEO and PPC, what do you think now?
Carpentier: I’m still foggy on the PPC side. I see traffic, but wonder if there is an adjustment to make that could make the returns higher. I still wonder if PPC plays in the rankings. If I quit PPC cold turkey, do I risk dropping in the organic rankings? I’m sure you will beat me up for saying that, but I wonder.
HubShout: Do you think PPC or SEO has a better ROI?
Carpentier: I don’t know how to break that apart. Instinctively, I think SEO has better ROI. I believe that the serious buyers are looking in organic, not PPC results. The PPC terms are getting more transactional. SEO has more substantial leads. But, that is more of a gut feeling.
HubShout: Has PPC and SEO gone faster, slower or about the speed that you expected?
Carpentier: I think my expectations were properly set by you guys. SEO went a little faster than expected. I saw a rankings and traffic increase. I’m not sure what my PPC expectations were. I see traffic, but I’m not sure of the quality of the traffic.
HubShout: Did you have a timeline within which you expected to see results?
Carpentier: Six months. I wasn’t going to turn it off after six months but would have challenged the program if I didn’t see results. I saw things happen within 3 months and was happy. My bar was higher for PPC than SEO. I’ve not seen the results on PPC that I wanted. Perhaps it’s because I expected instant results. I’m getting people who are looking to buy one-off magnets vs. someone who wants a volume of magnets.
HubShout: Would you recommend that a small business skip PPC and only do SEO?
Carpentier: It’s valuable to do both. The value comes in the immediacy of PPC. If you buy a business that never had a website, then PPC gets you in the game faster since a new website takes longer to rank.
HubShout: Are you doing Social Media?
Carpentier: No. My perception is that magnets are not dynamic enough that people are looking to blogs or twitter for that latest and greatest thing. I’m not sure there would be much payoff. Often in the B2B world, I see blogs with the latest post dated 2010 giving me the impression it didn’t work and was abandoned. That looks really bad!
HubShout: Do you believe that NOT doing Social Media impacts your rankings in a negative way?
Carpentier: I think it might have some impact, but not as much as I worry about PPC impacting search rankings. (This is the mystery of what is involved in SEO ranking.) I think that social media has a place, but I question how to use it in the B2B world. I don’t think my buyers are really looking at social media when trying to find a vendor for a magnet. It is price, quality and service that drives decision makers. Social media doesn’t help that.
HubShout: Are you doing email marketing?
Carpentier: We do have an active email marketing campaign for Rochester Magnet. We have a core list of current customers. We have not gone into prospecting yet, but we try to get a monthly blast out to people who have done business with us.
HubShout: Any engagement there?
Carpentier: We see good numbers. The open rate is good. The click-through seems solid. We get some anecdotal responses that people are seeing it. But I don’t know if it is doing anything for us other than, what I call, keeping that customer intimacy going. They are at least seeing our name and thinking about us. I would hope that a cross sell or upsell comes up because we help educate customers on products. But we have not seen that yet.
HubShout: What advice do you have for other small business owners trying to get into SEM strategies?
Carpentier: Understand your business. That may seem blazingly obvious, but you have to take an outside-in view of how someone would be looking for your product or service. What are the words they use to describe your products? Be on sales calls and listen to the way your customers talk about your products. In the magnet business, we call one of our products “flex magnet with adhesive.” If I hadn’t been on calls with customers, I wouldn’t have realized that some customers were calling it “magnetic tape” which pointed us toward alternate terms to optimize on. You should also look at competition to find new ideas and then be a fast follower. Look at the terms your competitors rank on.
HubShout: Did you ever try or consider the do-it-yourself approach to SEO or PPC?
Carpentier. No. Well, let me correct myself. PPC, maybe... I would dip my toe in that. PPC would be something I’d consider doing on my own. SEO is too big of a black box to me. Particularly for a small business that isn’t going to get results doing it on their own. I’ve got the basics (meta / title / content) but I’m not versed in it. I don’t understand it and I’m not going to dedicate myself to staying up on it at all time. I don’t want to take my eye off running my business. I feel that having a professional SEO is similar to having a professional money manager watching over my portfolio. They are paid to keep current, listen to the Fed, etc. Same thing in SEO, which seems to be changing all the time just like interest rates.