Meet The Director of Marketing Tasked with Growing His Company to 25,000 Doors
Today, on The Profitable Property Management Podcast, I’m talking with Spencer Sutton, the Director of Marketing for GK Houses, an ambitious and high-growth property management company now based in Birmingham, Chattanooga, and Nashville.
In our chat, we dive into why GK hired a Director of Marketing and what exactly Spencer plans to do to help them reach their goal of 25,000 doors.
- (01:03) – Spencer’s background before teaming up with GK Housing.
- (01:13) – His experience running a Home Vestors franchise in Birmingham.
- How he met the future founder of GK Houses.
- (01:49) – Left the housing market after the 2008 crash.
- (02:18) – Started a non-profit called, “Never Thirst”.
- (02:47) – Turned “Never Thirst” over and joined GK as Director of Marketing.
- (01:13) – His experience running a Home Vestors franchise in Birmingham.
- (04:41) – The growth of GK Houses.
- (04:41) – Where the company is today.
- (04:46) – Occupied houses versus non-occupied.
- (05:38) – Head count by location.
- (06:02) – GK’s infrastructure model.
- (06:11) – Departmentalization.
- (07:04) – GK’s growth goals.
- (08:52) – Anticipation of parabolic growth versus linear growth.
- (09:39) – Strategy to build team leaders.
- (10:39) – The process for finding and training team leaders.
- (09:39) – Strategy to build team leaders.
- (08:52) – Anticipation of parabolic growth versus linear growth.
- (12:33) – GK’s visual identity and brand message.
- (13:12) – Process of developing the ideal customer avatar.
- Mike the Investor and Susie Homeowner.
- (13:38) – Building their message based on these two ideals.
- (13:12) – Process of developing the ideal customer avatar.
- (15:35) – How GK produced their lead magnets.
- (18:06) – Where these lead magnets are today.
- (20:42) – 2018 Owner Happiness Survey.
- (22:26) – Making infographics.
- (23:30) – Discussion on transparency.
- (25:31) – Non-metric driven lead generation and marketing.
- (26:04) – Interviews and PR.
- (26:04) – Spencer’s response to the NARPM conference.
- (04:41) – Where the company is today.
- (27:51) – Spencer’s role as Director of Marketing at GK Houses.
- (28:09) – Oversight in the sales department.
- (28:13) – Spencer discusses GK’s sales funnel process.
- (30:03) – The details of response time.
- (30:45) – When and if Spencer get’s involved in the sales process.
- (32:03) – Further details of the sales process and who is involved.
- (32:24) – Duties and responsibilities of their main owner sales leader.
- (36:24) – The performance review process for the sales department at GK.
- (36:43) – Four question process.
- (37:23) – Reviewing the closing percentage through Lead Simple.
- (38:00) – GK’s Passive nurture email drip campaign.
- (38:36) – What success looks like for Spencer’s role as Director of Marketing.
- (38:51) – Lead generation.
- (39:28) – GK’s lead commit.
- (38:51) – Lead generation.
- (40:30) – GK’s successes and what has worked for lead generation.
- (41:06) – Paid leads via Google Adwords.
- (41:35) – Focused use of keywords.
- (42:50) – In-house management of pay-per-click.
- (44:58) – Pros and cons of All Property Management.
- (48:40) – Marketing core competencies.
- (50:15) – Opportunity for growth within the investor community using Facebook advertising.
- (50:24) – Use of a robust consumer focused content platform.
- (41:06) – Paid leads via Google Adwords.
- (52:23) – What is the number one challenge for you to succeed in your role?
- (55:15) – How much is too much for client acquisition cost?
- (56:20) – What advice do you wish you received on your first day as Director of Marketing?
- (57:20) – What is the number thing you see property management companies doing wrong when it comes to marketing?
- “Who” – The book where GK got it’s hiring & interviewing strategy. (11:08)
- Owner Happiness Survey Infographic – Showing the results of GK’s yearly survey. (22:50)
- The GK Houses Process (GK eBook)
- How to Rent Your Home – A Step By Step Process (GK eBook)
Where to learn more:
If you want to learn more about GK Houses and stay in touch with developments there, head to their website GKHouses.com.
Jordan: Welcome closers. Today we have another episode of the Profitable Property Management Podcast. Coming at you. Season one. Still on marketing. I’m your host Jordan Muela, and every week I interview world-class property management entrepreneurs and industry experts who share actual insights to help you grow your property management empire.
Whether you manage 100 units or 1000, this is the show that’s going to help you see the big picture and give you the tools and tactics that you need to achieve your goals.
So, if you’re tired of hearing the same recycled strategies and content everybody else is talking about, this is going to be a fresh take to help you take your business to the next level.
Today, I’m talking with Spencer Sutton, the Director of Marketing for GK Houses. An ambitious and high-growth property management company now based in Birmingham, Chattanooga, and Nashville. In today’s chat, we’re going to dive into why GK took the step of hiring a Director of Marketing and what exactly Spencer does to help GK win.
Welcome to the show Spencer.
Spencer: 0:01:00.3 Hey thanks Jordan, thanks for having me.
Jordan: 0:01:03.2 Absolutely. So Spencer, I want to start here. Tell me a little bit about your background. How did you end up working with GK? What were you doing prior to that?
Spencer: 0:01:13.1 Yeah, sure. Well, it goes back quite a ways. Back in 2003, I bought a franchise here in Birmingham, called Home Vestors. We’re the – we had big yellow billboards all around the city. Says, “We buy ugly houses.”
So, I was the house flipper, and I sold a house, a couple of houses to a guy I got to know. His name is Mathew Whitaker. Back in 2004. And he bought a franchise. So, they’re about four franchises here in Birmingham. We were buying and selling houses, it was a hot market.
0:01:49.9 Mathew and I became very good friends, and when the crash hit in 2008, I had probably about 30 rental houses. Mathew and his group, his partners, they had about 30 rental houses and I made the decision to go and do something different. And Mathew said, “I’m going to stick it out.” So, he started GK houses in 2008 with his 30 houses.
0:02:18.8 I started a non-profit called, “Never Thirst”. So, I would literally travel around the world and mostly in some really developing countries. India, South Sudan, Cambodia, Nepal, and we were providing clean water for remote villages.
And so, 0:02:37.6 I couldn’t have the hands on that I used to when I was in the business, so I handed all my properties over to Mathew 0:02:44.9 sometime, probably late in 2008,
0:02:47.9 Fast-forward, I turned — Never Thirst was turned over to a good friend of mine, I was doing some marketing on the side, so I, you know, just started to talking to Mathew one day. We went and had lunch, and I remember sending him an email on a Saturday saying, you know, “I’ve looked at your site, I see what you’re doing, you really need some help.” 0:03:13.8 He was struggling.
And so, we went and had lunch, and this was back in probably October of 2014, and he just said, “Hey listen, we’ve got some really ambitious goals. We want to grow this thing to 25,000 houses. We want to be in over 30 markets and we need somebody to help us get there. So, why don’t you come work for us.” 0:03:42.1 And so, with that prior relationship – I have a lot of respect for Mathew. I had a lot of respect, still do. So, I signed on in December of 2014. So, that’s kind of how I got here.
Jordan: 0:03:55.3 And so did you sign on to your specific role, your current role of Director of Marketing, is that where you started?
Spencer: 0:03:59.8 Yeah, it is. It is. That’s kind of my background. Marketing back in college, but then, even doing Home Vestors, I was buying and selling houses. Most of the selling is what I was doing. When I did my non-profit, I was involved with so much of the marketing – I mean so much of the messaging that it was just kind of what I did.
So, I didn’t have any desire to be a property manager, and I didn’t really have a desire to do any other role. What I really wanted to do though was – I got behind Mathew’s vision of growing this thing to 25,000 houses. So, I signed on as Marketer, as Director of Marketing.
Jordan: 0:04:41.9 So where’s the company at today? How many doors are you guys managing and what’s the head count?
Spencer: 0:04:46.4 Well, we used to count Jordan, we would just say we manage 1000 houses, but in reality, we probably only – at certain times, only had 800 houses occupied, or whatever. Because we had houses in turn, we had houses that were inactive, you know how it goes. So, probably about six months ago, we decided just to talk about occupied houses. Because that’s really the only time we make money, is when houses are occupied. 0:05:10.6
Jordan: 0:05:12.0 Sure, sure.
Spencer: 0:05:13.5 So, right now, we’re at 1500 occupied houses. Almost, yeah go ahead.
Jordan: 0:05:20.1 Well, I was just going to say, can you divvy that up by market?
Spencer: 0:05:24.8 I was about to do that. Around probably 850 here in Birmingham, and another 150 in Nashville, 500 in Chattanooga.
Jordan: 0:05:38.6 Awesome. And what’s the company’s head count by location?
Spencer: 0:05:42.3 Here in corporate, we probably have 20. A little over 20 people including maintenance. And then in Nashville, we’ve got two plus an intern. In Chattanooga, we’ve got three I believe right now.
Jordan: 0:06:02.4 And what is the model? When you talk about corporate, what do you guys have a back office infrastructure that’s servicing the other markets, and if so, what does that look like?
Spencer: 0:06:11.5 Yeah. So it’s really interesting, because when I came on at GK Houses, something that Mathew had to explain to me is we’re departmentalized. So, we’re – it’s not a traditional portfolio management style.
So, we have a leasing department. That’s all here in Birmingham. 0:06:30.1 So, our leasing department handles everything for all markets. We have owner communication. Owner communications handle out of Birmingham. Tenant communications handle out of Birmingham, and so, really, we’re very, very departmentalized. All of our accounting and finances handle here out of Birmingham. 0:06:49.1 So, statements are prepared and sent out from Birmingham, and then really, on the ground, we just need these property managers and we also have team leaders in each city.
Jordan: 0:07:04.5 Ok. Awesome. That makes sense. And what is the company’s growth goal in three to five years? And before you answer that, you guys reached the Fortune 5000 list. Congrats on that. Hats off. As part of that, there is some revenue reporting.
So, you guys reported 2015 operating revenue 2.7 million. Three year percentage growth up to that point of 302%. So, some pretty significant and meaningful growth up to that point. Obviously, the numbers are out of date. We don’t need to talk revenue, but let’s just stick with doors.
0:07:42.5 You mentioned that the growth goal was – was that, did I hear 25,000 doors, is that what I heard?
Spencer: 0:07:47.9 That’s right, 25,000.
Jordan: 0:07:50.1 Put a time-frame on that for me. Is this a ten year, 20 year or five year goal?
Spencer: 0:07:55.2 That’s a great, great question. It is a ten year goal, but we’re already into that buy a couple of years. 0:08:03.0 [Edit Out] So, yeah we’re looking at – and I’m going to pull it up, because I’m going to tell you exactly. We have a – this all set out for us, so – hold on one sec. 0:08:24.1 [Edit Out] So our ten year target it is 12.31.24. And the goal is to have 25,000 occupied houses and a goal – a revenue goal 75,000,000.
Jordan: 0:08:42.1 Fantastic. I like. I love the ambition. So, that’s where this company is trying to get to. That is officially what we would call a bhag. A big, hairy, audacious goal. But what I want to get into, is how it’s going to happen.
0:08:52.1 And one question before we get into all the minutiae, do you anticipate that growth being linear or parabolic? Is it going to be steady, steady, steady, steady or do you think there’s going to be an inflection point somewhere along the way where you expect the growth rate to ramp?
Spencer: 0:09:16.0 Yes. I think, I think that’s exactly how it’s going to happen. So, we’re slowly building here in the – out of the corporate office, also we’re experimenting in our other offices. But essentially, we’re building team leaders.
So, this is probably the biggest strategy that we have, is to build leaders. 0:09:39.8 Young entrepreneurs who want to own their own business one day. We’re going to give them the opportunity to do it on our dime. And we’re going to send them out into these markets.
And so, really, the two things that are going to hold us back, is really the people to do it, and the capital. 0:10:00.0 And so, we feel like probably over the next – we’ll be continuing to build over maybe the next two years, and then we’ll be able to grow at scale.
Jordan: 0:10:12.5 Alright. I like it. So what I’m hearing here, is that you’re building a partner model. These people that are home green, hustlers, they’re motivated, have an entrepreneurial bent, you’re wanting to do intrapreneurship, find an opportunity for them to grow and expand inside the organization. 0:10:30.5 And presumably, take that pretty far and maybe some day use that as the staging round for going off and establishing their own ventures. Is that the kind of angle I’m hearing?
Spencer: 0:10:39.4 Yeah absolutely. We want people who want to – who are most definitely entrepreneurs and see this as an incredible learning opportunity. So, and we’re very, very open. So, we’re a very transparent company and we talk to all of our candidates about this.
0:10:58.6 So, when they’re interviewed here in Birmingham, let’s just say we have several candidates here in Birmingham, we put them through something we call The Grinder. Which is our interview process that we got out of the book, “Who”, 0:11:08.8 [Resource Mentioned] which is a great book by the way.
Jordan: 0:11:13.8 Absolutely. The book was written by the son of the guy that wrote, “Top Grading”.
Spencer: 0:11:18.3 Oh, ok great, I’ve heard of that. I’ve heard of “Top Grading”. 0:11:21.9 So, and that’s one of the things we’re very upfront about. You will not stay here in Birmingham. Our goal is to mobilize you into a different market.
So, if that’s not something you see yourself doing in about 24 months, then this is probably not the place for you. 0:11:40.7 So, today we’ve deployed two team leaders here in Birmingham. One to Nashville and one to Chattanooga. And we’re learning. So, this is a learning process as we go, but it’s worked well so far.
Jordan: 0:11:52.7 Yeah, it absolutely makes sense. Clone leaders and send them abroad. So let’s get into the nuts and bolts. I have followed GK for some time. Not out of a personal relationship with either you or Mathew, but purely on the basis of the fact that the company has been a bit of a novelty in the sense that the brand identity has clearly been intentional for some time.
0:12:17.0 And I’ve probably followed the brand for, let’s say two, three years. You’ve been around for at least that long, so maybe that is some of your influence. But for me, even just starting with visual identity, I collect sales collateral as a hobby. 0:12:33.1 You guys have invested in visual identity of the company. Let’s lead off with brand.
Describe for me, on a consumer facing level, in language that the consumer would understand, what is the brand identity? What’s the story, what’s the message behind GK?
Spencer: 0:12:48.7 Yeah. You know, when I came onboard, I don’t know if there really was an outward facing identity all that much. And I’m not saying it’s all me, because it’s definitely a team effort. But one of the first things that we did was, we wanted to identify who that customer was.
0:13:12.0 And so we went through a process of building out our avatar for our perfect customer. And so we came up with Mike the investor and Susie homeowner. They’re two totally different people, we have a lot of investors here in Birmingham, and then for Susie homeowner, they’re typically the accidental landlord, or maybe they want to do it as a little bit of a hobby.
0:13:38.2 So, we really wanted to build our messaging to speak to those two people, and the website – and I think this is kind of what you’re getting at, but we wanted out website to be very simple. And, of course I’m speaking a lot of owners, because I do so much marketing to owners, but tenants as well. But simple, very elegant, easy to navigate, and we really wanted to give them as much information as they felt necessary to help make them a decision.
0:14:17.0 I will say, it’s not necessarily a conversion based website. Our websites aren’t necessarily conversion based, but we do a lot of – we have a lot of landing pages for that. So, we kind of address some of those things.
Jordan: 0:14:32.4 The fact that we’re even having the conversation about differentiating between the two, conversion focused versus design or UX or brand focus means there’s a level of intentionality that many companies do not apply.
0:14:42.4 Let’s start off with sales collateral. So, I’ve collected sales collateral from property management companies for many years now. GK is probably in the top three of the robustness of the offerings. What’s interesting is not all of these are even available on the website currently as I can tell.
0:14:52.4 But I’m referring to things like ebooks. “Five Keys to Mastering Rental Property in Birmingham, Alabama”. Looks like this is a 17 page ebook. Well produced, slick, content rich. It’s an ebook, it’s a lead magnet. Another one: “Five Turnkey Manipulations That Could Cost You Thousands”. “Ten Curb Appeal Tips to Help Rent Your Fast”.
0:15:35.6 All of these are lead magnets. They can be gated or they can be not gated. You can give them away just to educate people, or you can gate it. 0:15:46.6 I know this is getting into the minutiae.
But walk me through the production through those content assets. Did you do it yourself? Did you use it? Did you go with a third party? How did the process go in producing the asset, and then how did you feel like the ROI was on the investment in those content asset pieces?
Spencer: 0:16:05.3 Yeah, great questions. So, we did those pretty much in house. And so, having been in real estate for so long, buying and selling houses, so we’re really tapped into our customer from an investor profile.
So we – the ebook about the manipulations, the turnkey manipulations just came out of frustration of seeing people buy houses here in Birmingham and struggle. And then a lot of times they would blame a property manager, when it was really a bad buy on their part.
0:16:42.9 So, we – it’s really – Mathew and I would sit down, we’d – I might write out a general outline, we both sit down to put this thing together, and then I would send – just for the technical stuff, I would get it all in a document, a Google Doc, and I would send it off to somebody, a designer, and have them make it look as pretty as possible, and design a cover, and then bring it back.
And at that point, probably when you downloaded those, I was using a landing page called Clip Tunnels 0:17:19.3 [To Be Confirmed] and it’s really a lead, it’s kind of a lead magnet, so we capture people’s information, and drip market to them from that point. So that’s kind of the way we did it.
Jordan: 0:17:33.0 That makes sense. What I like here, is there’s really a couple things. The first is it’s a demonstration of empathy. You’re putting yourself in the consumer situation. What do they want to know? What issues are resonant with them? That primary orientation. Secondly, your care about packaging. And I cannot overemphasize this. You take the same content from the same mind, the same expertise, the same ideas and thoughts, you package them differently…exponential difference in return. You took the time to invest in design.
0:18:06.7 But, what’s interesting to me is that not all of these are available on your website anymore. What’s the story there? Did this work for you? Was it a success, and if so, why is this content no longer being leveraged at the moment?
Spencer: 0:18:19.2 Yeah, let me – I’ll be real transparent about that. We were using that, it was on our website, and we were – we had, I think some good success with it. And definitely, when people would call us and talk to us about our management, we got time and time again, “Yeah, you know, I saw your ebooks, I watched your videos.”
We probably produced 30 or 40 other videos, talking about similar type subjects. Then we switched our website. 0:18:53.3 So, we created a whole new website with a different interface, and at the same time we were doing this, we were also 0:19:04.6 [Inaudible – Recording glitch] Nashville.
So we were buying a company in Nashville, and really I started working on a lot of Google Adwords, marketing, advertising, and really got away from our content rich focus. But it’s something like — Mathew and I sat down literally on Friday and had a very long discussion about all of our content and the need – we desperately need to keep producing it and make these types of things available to more and more people.
So, our landing page for these lead magnets that would capture information that we were using at one point and we now switched gears and we’ve been using Google Adwords to get out in front of people. 0:19:52.6 So to your point, we are – we’re retooling all of our content and bringing it back out over the next several months.
Jordan: 0:20:00.0 Make it work for you man. You’ve got some gems here bro. These are really underrated. Get them out, make more videos.
Now an interesting question is, do you gate or do you not. Meaning do you put it behind a lead capture or the general rule of thumb we tend to follow, is that if the content is talking about the service offering in any way, do not gate, meaning let’s lower funnel, if it’s higher funnel, there’s an opportunity to gate.
Alright, I appreciate the answer there, that makes sense. I know things are in flux, things are in change, but you guys deserve some props for that. I want to see that content. The next thing, because we’re still talking about sales collateral guys. 0:20:37.6 Massive opportunity here. This company’s done it 0:20:39.2 [Inaudible – Recording glitch]
Now I want to talk about the 2018 Owner Happiness Survey. What’s interesting about this one to me Spencer, is that you could look at this and you could say this is a bunch of boring, banal numbers that are going to bore somebody to tears. And yet, with the graphics, with the vision, with the investment and presentation, you’ve made a lot of operational numbers and KPIs, in some ways presumably have nothing to do with the customer, interesting. Accessible and rich. Tell me about the thought process. Where did that idea come from?
Spencer: 0:21:19.7 Yeah. That’s a great one. You know, when I started at GK Houses, I was – as the Director of Marketing, I needed to know who our customer was. Like, who already does business with us.
And so I asked Mathew. I was like, “Have you ever done a survey of the owners?” And he’d been building this thing literally by a long time and he just never had done it. And I think the tendency in our business also, we hear from owners when they’re mad. Right?
So, that doesn’t – you don’t necessarily want to put out a survey just to get more bad feedback, but I asked him, “I think it’s important for us to do this and then let’s package it up 0:22:06.4 [Inaudible – Recording glitch] …graphic and regardless of what the information reveals, we need to share it”.
Because we’re all big believers here of just being very transparent and if we can help an owner make a decision. If they don’t like something and they don’t want to do business with us, we’d rather know up front than invest a lot of money to onboard them only to find out later.
0:22:26.9 So, this was all information. There was a bunch of numbers, we got it back. All we did was put together a Google Questionnaire, I think they have a Google Quiz or something like that. Google Forms, that’s what it was. It populates to a Google spreadsheet, I took all that information and I decided exactly how I wanted to present it or whatever.
22:50 I sent it off to somebody. Either on Fiverr or Upwork, I can’t really remember. Probably Upwork, but I was just looking for somebody who could build an infographic. It’s a painful – it can be a painful process, especially if you want to get it looking the way you want to get it look, but I think it’s been very useful. We do use it. We link to it and show people, “Hey this is what we do.”
And now it’s become a thing at GK Houses. 0:23:11.9 Every February, we send out a survey. Because we want to know. We want to see what people would like – what are we doing well, what do we need to improve. And we’ve received some extremely valuable feedback.
Jordan: 0:23:30.7 Spencer, I’ve got to tell you, this is a pretty shocking piece of content for me on two levels. The first is on the levels of a property management company, people don’t want to have transparency. They don’t want to be exposed. I’m using air quotes here. To have their numbers put out there. And what’s really interesting to me, is that the average owner happiness came back from the survey, which this is effectively an NPS, a net promoter score 0:23:52.7, they don’t 0:23:53.0 [Inaudible] back, go Google NPS.
The thing is, the rating was 7.7 and that puts your average rating within the brackets of what are called passives 0:24:03.9 meaning that number could be better. Ideally, you’d like it to be an 8 or a 9. It’s still, it’s still strong, but it could be better.
The point being here, there is even a little bit of vulnerability here. The number, it wasn’t a 10. This wasn’t an obvious, in your face, we killed it. So that’s, on the consumer side, what’s shocking to me, is you’re sharing, and even exposing yourself to criticism.
0:24:28.5 What I think from a consumer perspective 0:24:30.3 [Inaudible – Recording glitch] company is an order of magnitude more transparent than an other company, they’ve already won my trust regardless of the results. Simply because of their willingness to be open and transparent.
0:24:44.0 Because that crosses all areas of business, all customer interactions. Transparency enables consumers to make their own decision if the company that’s providing services is willing to be vulnerable. Transparency.
Last thing with sales collateral, you also bring it into the process with the GK Houses’ process, it looks like to become a customer, to work with you guys, that’s also been turned into an infographic, both in long form and in summary. Fascinating stuff. Guys, go check it out on the website. We’ll set up a link to where they show that 0:25:21.4 [Resource Mentioned] in the show notes this episode. 0:25:24.9 But I had to start there, because sales collateral is just something that I find fascinating. And you guys have really set yourselves apart in investing there.
0:25:31.9 But let’s transition to talk about other things that you guys have done. I kind of, I don’t want to say superficial, but the less — the harder to quantify level. For example, PR. Mathew’s around, he’s doing interviews. You guys pursued the Fortune 5000 designation. How do you guys think about the less, the less metric driven pieces of marketing that PR and interviews relate to? How do you think about the value add, why is that worth Mathew’s time to invest in those sorts of activities?
Spencer: 0:26:04.6 Yeah. I think that it’s not something that we spend a ton of time on. The PR side of it. We just look for certain opportunities where it may be a fit. I came away from NARPM 0:26:25.0 in Vegas this past year, in April. This was my first time going there, and I listened to all the speakers, I went to several different breakouts.
So we had a big recap meeting in our hotel room before we left and that was one of the – one of my big takeaways. I was like, “You know, Mathew, I think you could speak at some of these events.” We’re trying to grow to 25,000 houses and part of our strategy for doing this is acquisition, so why not let people see what we’re doing and we can see it as an opportunity to allow Mathew to go and speak at different places. We can help other property managers in different markets. 0:27:17.7 PR is, you’re right, a lot less quantifiable, but we think it’s important. We don’t spend a lot of time on it.
Jordan: 0:27:27.5 Awesome. Makes sense. Exploring the low-hanging opportunities as they come. Building some personal branding for Mathew, which makes sense because it’s not forced right? You guys are actually doing legitimately interesting, innovative things and therefore it’s a little bit more downhill skiing than if you’re pushing PR hard and it’s lipstick on a pig. Makes sense to me.
0:27:51.8 Let’s transition to the sales side of things. We’re going to go back up funnel and talk about marketing, but I want to go lower in the funnel with the sales process. So your title is Director of Marketing. To what degree do you interact with sales? Do you have oversight over sales? Is that a different department head? How does that work?
Spencer: 0:28:09.4 Yeah, I have oversight over sales.
Jordan: 0:28:13.9 So the two are integrated, which totally makes sense to me. Talk to me about the sales funnel process. What do you expect to see happen in an ideal world? When I say an ideal world, what you’re actually enforcing through management and oversight.
What do you expect to happen to a lead that fills out a contact form on your website? From form submission to close. Just kind of walk me through that process and who’s involved.
Spencer: 0:28:36.4 Yeah. So, we have a sales person here in Birmingham that handles Birmingham, Nashville and Chattanooga, and so their responsibility, the first thing – and we use Lead Simple as our CRM to run everything through, but I’m just a huge believer in first contact all the way to – we feel like somebody needs ten touches before we would say they’re inactive or they’re either going to tell us they went with someone else, or we’re going to touch them ten times.
0:29:18.0 Even then we’re going to put them on a passive nurture. So, Alex Fortenberry, right now, is in that position. Now Alex is just like anybody else that went through what we call The Grinder. He’s training to be a team leader. He just happens to be starting in sales. But it is a very, very important role for us because of our growth, our plan.
We want to grow through – we’re going to grow through acquisition, but growing organically is very important to us as well. 0:29:51.8 So, first thing is – for us is, when that lead comes in, his responsibility is to get back with them as soon as possible. I think…
Jordan: 0:30:02.4 Put a number on it for me man.
Spencer: 0:30:03.7 Oh man. I would say immediately, is what I want to say, unfortunately, we have – we’re involved in different meetings throughout the day or he can be on the phone with somebody. If he’s on the phone with somebody and a lead comes in and I need to take it, I’ll do that. They’re not my normal role, but I’m more than happy to pick up the phone and talk to somebody.
But literally – I really want to see his callback time be less than an hour. Ideally, within three to five minutes is what I want to see. But I know that’s not always going to be possible.
Jordan: 0:30:45.8 Got it. So if he’s not responded within the first few – how long does a lead need to sit before you’re going to get involved.
Spencer: 0:30:55.7 Well, I just want to get – I’m not – I trust Alex, so I’m not looking over his shoulder all the time, but for example, we came in this morning, and one of the things I asked him was, because I saw we got several leads last night.
We got about three or four leads last night, and I was like, “Hey what’s your plan for getting back with these people?” Because I know he has a busy day, I’ve got a busy day, and he was like, “I’m going to knock it out, I’m going to do it first thing this morning.”
I said, “OK.” You know, if he asked me to get a call, and he’s really proactive – and that’s a good thing. If you have anybody in the sales role, they need to be, I think, somewhat of a bulldog. And I told Alex this. I’m like, “I need to see you be a bulldog on these leads.” They’re expensive right? They’re not free, especially if they come through Adwords or Facebook or some other paid source. They’re very expensive.
I’ll hop on it if he asks me to, but usually I’m not looking over his shoulder. 0:31:59.4 But we do discuss it.
Jordan: 0:32:03.9 Got it. That makes sense. So, next – so step one is speak to contact. Step two is multiple follow-up attempts. At what point does it get kicked over to somebody else? How broad, how deep into the sales funnel is Alex’s role? Does he take them all the way to going to the property and signing the contract or where does handoff happen? Who else is involved?
Spencer: 0:32:24.2 Yeah. So, when I came on, I ran sales for a little bit and it was very draining on me, because I was involved in the whole on-boarding process and so much stuff. So we shorten it up for Alex and for other people.
So he is responsible literally, when he gets that management agreement signed and turns it over to our operations coordinator who handles all the owner com, he’s done with it.
0:32:51.7 Now they do have his email, so people will email him and he’ll respond. He’s very gracious, but we really want them to then contact operations and just be – just let our operations department handle it from there.
So I really want him focused on following up with leads and making sure they have a great experience as they first get on. Then after that he’s passing them off. He doesn’t walk them through the entire on-boarding process.
Jordan: 0:33:24.6 So he’s handling this process for all three markets correct?
Spencer: 0:33:29.4 That is correct.
Jordan: 0:33:31.7 So that means he is not doing onsite visits, is that correct?
Spencer: 0:33:34.6 That is correct. Yeah. So we have team leaders in each of those – so in Chattanooga and in Nashville, which is really interesting, Jordan, I think every market is a little bit different. 0:33:45.5 We found this — for Birmingham, we didn’t need to go out to the property. We could just – I could have a conversation with somebody and get them to sign on the – sign up just via email.
A lot of times, and a lot of the people in Birmingham are out of state investors, so they weren’t around. 0:34:02.3 They didn’t have to meet me at the property. They didn’t need to meet Alex.
And so, then when we moved into Nashville we realized it’s a little bit of a different game. Much different market, people wanted to meet at the property. Probably more Susie Homeowners than Mike the Investors in Nashville.
And then in Chattanooga, we realized that people would rather – I would say 50/50 they want to meet at the property and so we have our team leaders who are prepared to go out and meet with folks.
Jordan: 0:34:34.0 So is it fair to say that Alex’s role is effectively an ISA. And the differentiation being an ISA, Inside Sales Agent, is really butt-in-chair, doing calls and emails where the BDM function, Business Development Manager, tends to be doing a combination of in the office and outside of the office. Is Alex – what is his functional title within the company?
Spencer: 0:34:57.0 He’s Owner Sales. Well that’s his title. I think he’s a little bit of both. For these other markets, absolutely, he is hammering the phone, inside sales. For Birmingham, he does go out. I’ve seen him, probably over the past week, week and a half, he’s had six or seven appointments out of the office. Which is great. But for these other markets, most definitely he’s on the phone.
Jordan: 0:35:26.1 Now why do you have him carry that load of doing onsite visits in Birmingham? Why not have the Birmingham team leader handle those?
Spencer: 0:35:33.1 Because Alex is probably started that conversation with them, it just kind of makes sense because he’s on the phone with them and instead of trying to coordinate schedules with our Birmingham team leader, it just makes it easy for him to do that. I think that – the vast majority of the time, he doesn’t do it. The vast majority of the time he just says, “Hey, sign a management agreement, we’ll send a PM out there, they’ll walk through the property. What we’re going to give back to you Mr. or Mrs. Owner, is a inspector’s report. It’s going to have everything you need to know on it.” And so, he essentially sells them on the phone, gets them to sign a management agreement and then the PM goes out there and takes care of all that. 0:36:21.7 Most of the time, that’s what he’s doing.
Jordan: 0:36:24.3 So what does performance reviews look like in Alex’s role? I’m sure generally, culturally, you have some process for performance reviews, but specifically, in light of the fact that he’s handling sales, what kind of benchmarks or standards do you set for that role? In terms of your expectations for somebody in sales?
Spencer: 0:36:43.3 Yeah. We do. We have a monthly one-to-one. Alex and I do, and we ask pretty much the same questions every month. What did you accomplish this past month? What are you going to accomplish this next month? What areas do you need to improve? And are you embracing our core values.
So those are the four questions I ask every single time we sit down. Now I’ll bring to that meeting different things that I’ve noticed.
So, I’ll spend a good amount of time in Lead Simple, just looking at – the thing that I’m probably looking at most is closing ratio. 0:37:23.1 Like, what’s his closing percentage. In Birmingham, historically, we’ve been around 30%. And that’s just because people know who we are and we got a lot of – we get a good amount of referrals. In the other markets where we’re fairly new, it’s a little bit different.
So, we’re constantly talking about that. I’m also looking at – like we mentioned, his touches. So I want to see number of touches before somebody moves to do an inactive nurture – I’m sorry, a passive nurture.
0:38:00.7 So we have a passive nurture, an email team that goes out over the course of twelve months. It’ll drip on them. So I want to see how many touches. 0:38:12.9 So those are the things that I’m mostly concerned about with him. 0:38:16.4 And then I share an office with Alex, so I know if he’s making calls. I know if he’s following up.
So the performance review, we talk about those things, but we have conversations throughout our week that are all regarding sales and those types of things.
Jordan: 0:38:36.6 Awesome. So let’s move one step up. What about for your self? What does success look like for you in your role? How do you quantify that in a way that is specific and concrete?
Spencer: 0:38:51.3 Really, from my role, Mathew and I talk a lot about just lead generation. You know, as ambitious as we are, I need to be producing leads, especially in these newer markets.
So, we’re constantly talking about, what are our goals for the month. What are our goals – so we look at it on a weekly basis. 0:39:16.2 So we have a level ten meeting every single week and in that level ten meeting, every single time, in front of the entire team, we go through our company’s score card. We call it a score card.
0:39:28.9 We got most of our operational ideas out of a book called, “Traction” which has been a – great for us. So we’re looking at the score card, and the score card that pops: What are the leads versus our goals. 0:39:43.8 So if our goal is 40 leads a month per market, then we need to be averaging somewhere around ten leads per market. So that’s what Mathew and I talk about all the time.
Jordan: 0:39:54.5 Excellent. That’s what I wanted to hear, a lead commit. That’s what somebody, a director of marketing and sales in a CMO function should be doing. A lead commit. Interviews, PR, good looking ebooks, all that stuff is awesome, but it boils down to a lead commit.
So, let’s talk success, wins, failures, with lead gen. What have you tried over the years? What’s worked for you? What hasn’t? How are you feeling about organic versus paid? Work me through your thoughts on lead gen.
Spencer: 0:40:30.7 Yeah, lead gen. I love lead gen. I study it all the time. One of the biggest difficulties I think we have as property managers, just anybody out there, is when – especially when you’re looking at any kind of SEM, search engine marketing, paid advertising, is you’re dealing with – you’ve got two sets of customers, and one greatly outweighs the other. You’ve got ten to one tenants versus owners looking for your services.
At least that’s what I’ve found, and so. 0:41:02.9 I’ll talk about paid first, then I’ll talk about organic.
0:41:06.1 Paid. We’ve both lost and won with paid. And we’ve learned a lot along the way. So, just getting into Google Adwords over a year ago. Found out real fast that tenants really don’t care, as long as they find your contact information. They’ll fill out a form, they’ll call, they’ll do whatever, they’ll waste your money. Because we don’t – and not saying that tenants aren’t important, but we don’t have a problem finding tenants.
0:41:35.0 We get a lot of traffic from people who are looking for houses. What we – what my whole goal is to focus on owner leads. And so, we spent a lot of money. I mean, we committed a lot of money and spent a lot of money figuring out how do we, you know, really just focus these key words, and Google Adwords is what I’m specifically talking about. 0:42:02.8 How do we structure our campaigns, our ad sets, and our ads, and then our landing pages such that it’s extremely obvious.
0:42:12.5 First of all, the front end. How do we exclude certain keywords that we know tenants are searching for. So, how can we hide our ads from tenants and how can we show it to owners. Inevitably, you can’t do that. You can’t – 100% there’s no way, but over the course of twelve months, we’ve done a pretty good job of figuring that out. So, we love paid ads. We really love our paid ads, as opposed to All Property Management 0:42:47.2, where there’s…
Jordan: 0:42:50.7 [Inaudible – Too quiet]. You’d rather control it, I totally get that. With pay-per-click though, are you managing that in-house or have you worked with any agents just to help you with that?
Spencer: 0:42:59.4 I have done this in-house for over a year and I managed it myself. Love it. Recently though, having said that, recently I talked to a group and I have outsourced our Adwords to them. Probably, actually less than a month ago, we started this. So, we’re in a – we’re seeing how it goes without me controlling everything. 0:43:31.2 And if I’m not doing that, then I can be freed up to explore different avenues of paid search.
Jordan: 0:43:39.3 Interesting. Interesting. I like it. So, this is a higher angle attack approach here. The approach is first understand the nature of the service or the function. Get your hands dirty with it. Come away with a baseline understanding and then outsource it. I did the same thing myself. I was steeped in Google Adwords, deep, deep, for awhile.
What I found was, it changes – I would say it changes as much as SEO in a sense that the nature of campaigns are run, the new features Google’s running out – rolling out, all change very rapidly. 0:44:16.0 If you understand what are reasonable performance benchmarks because you’ve done it yourself, if you understand what this person is doing so they can’t BS you right? You don’t want to be the guy that’s going to the mechanic and getting told that you need, you know, tail light fluid or headlight fluid. Right?
Spencer: 0:44:37.1 That’s right.
Jordan: 0:44:37.1 You need to be able to differentiate between BS and real value added services. That’s the way I’ve always looked at working with paid professionals. I want to grasp the service, the outcome, the result, and then on a more narrow basis say, “I want you to help me with this specific thing” and be able to define the performance you expect.
0:44:58.5 So, I hope that works out well for you. But you did transition and segue. You mentioned APM, All Property Management. A lot of people have used this service. At the end of the day, what I find is, a lot of people have a negative emotion towards it. A, because leads are harder to close because the leads are being re-sold. They’re up front about that. They don’t make any bones about that fact, but at the end of the day, either it works or it doesn’t. 0:45:22.3 So for you guys, is it something that you have found was viable?
Spencer: 0:45:26.3 Well, we’re still using them. So, I’ll bring it up, we have a leadership meeting, we have it off-site every two months. So those of us – there’s four of us on the leadership team, we go off every two months to have these meetings. And this is something I bring up a lot. Mathew has a hard time letting leads, any leads go. So, he’s always going to fight for it. “No, I want to keep APM.” Which is great, I understand that. But the data has proven that they are more expensive.
I mean, I think coming into June, we hadn’t closed one, and we had spent $2000. And so, you know, we want our costs per acquisition, customer acquisition costs to be around $500 if we can get it there. 0:46:19.8 And so, I was kind of ready to let it go, but I think we closed three over the past month and a half.
So, we’ll re-assess that. I think if anybody’s listening out there who has APM leads, to me it all boils around how fast you can get back with those people. Because most of the time I don’t think they’re really looking to get a ton of quotes, they really just want to find somebody they trust.
And so, that’s why I’m telling Alex, you’ve got to be a bulldog. In Birmingham, in Birmingham, it’s interesting. We can call back – a call can go out ten minutes – the lead can come in, we can call them ten minutes later, fifteen minutes, 20 minutes later, we’re still the very first one to reach out to them. In Nashville, you better call within ten seconds, because there’s going to be three other managers who are calling them. It’s extremely competitive. 0:47:13.8 So, might depend on your market how successful you are with APM.
Jordan: 0:47:19.0 I’m sure that’s absolutely the case. I enjoy hearing you talk about that, because this is in the context of a company that can close. Most of the time, when I hear people complain about All Property Management, my sympathy level is low, because I don’t know, and I have to assume that they have a fairly dysfunctional sales process.
But you guys have somebody in that designated role, full-time, this isn’t somebody that’s juggling a full property management portfolio, acting as the broker, and oh yeah, part time doing sales. And if you guys are – you’re right on the fence, right? Like, if you found a more profitable, maybe you’d switch, but you mention a $500 customer acquisition cost. That’s marketing only right? 0:48:03.8 That’s not loaded with your sales labour costs as well, correct?
Spencer: 0:48:07.3 Yeah, that’s correct. Right.
Jordan: 0:48:09.6 Ok, that makes sense to me. So, the thing that I like to point out, is if you’re focused on high growth, you have to cobble together multiple channels. There’s not going to be any silver bullet. If your goal is to grow by, net, 50 doors a year, then maybe you can have the luxury of just focusing on one channel.
Like Adwords, for example. 0:48:29.9 But if you have really ambitious growth goals, you have to cobble the things that are working together very, very well with the things that are working just kind of so-so in order to hit your growth targets.
0:48:40.5 When we talk about the ambitious growth goals that you guys have, tell me how you think about the infrastructure that you view as being necessary to get there. What core – what organizational core competencies, what pieces of infrastructure are you going to need to build up that you have right now in order to maintain and sustain high growth goals over time?
Spencer: 0:49:04.1 Are you talking about from an entire organization standpoint? Or from a marketing standpoint?
Jordan: 0:49:11.8 From a marketing standpoint. Let’s ignore the on-boarding and service function.
Spencer: 0:49:16.6 Yeah, yeah. I think that’s a great question.
Jordan: 0:49:23.4 Maybe you’re still figuring it out you know.
Spencer: 0:49:24.9 Well, there’s no doubt we are. I mean, you know, a year and a half ago we jumped into Nashville and go beat up pretty bad trying to figure out. We’ve gotten a lot better this year.
And then Chattanooga, we jumped in with a totally different perspective, but we’ve learned a lot in Chattanooga, and so I think we’re still putting those pieces together. 0:49:48.7 I think there’s certain, probably foundations that we want, that we want to develop in every market and something that I’m excited about, and I don’t know if this is what you wanted to hear, but I think there’s a great opportunity for growth within the investor community in all these markets.
50:15 And I believe that it can be achieved through Facebook advertising. 0:50:17.3 And so, this is – that’s the component that we’re trying to build out.
Jordan: 0:50:21.9 Cutting edge.
Spencer: 0:50:24.8 Yeah, absolutely cutting edge. Like, extremely cutting edge. I think that content creation, to kind of go back to the ebooks and the good information that is extremely helpful to people. I think building out a robust content platform is going to be extremely important.
0:50:44.5 So that’s something we’re working on in the background. Not only with the ebooks and videos, but just blogs, you know, anything that can help people make decisions, give them opportunities to be successful in their rental endeavours, I think will benefit us going into these markets. 0:51:08.3 So, I mean, is that some of the things that you’re talking about?
Jordan: 0:51:13.3 Yeah, absolutely. So this relates to some of the experimentation that you’ll do with lead generation, so you want to find new channels, and channels that are scalable. What’s interesting about the investor play, is that it’s less focused on arbitrage, and it’s inserting that brand presence.
Because at the end of the day, you can make arbitrage scale, but it is not what I would consider a true competitive or strategic advantage. Having a brand relationship with a core constituency like investors. 0:51:44.9 We’ve seen people do this. I’m thinking guys like Chris Clothier 0:51:46.9 of Memphis Invest, guys like 0:51:49.2 [Inaudible – Recording glitch] Douglas Skipworth over at Crest Core, I believe Douglas Skipworth’s average properties per owner is 6.2, which is a good four times higher than your average property management company. That right there is – that’s leverage. That’s competitive advantage as you’re trying to scale.
0:52:13.0 I want to transition now with some rapid fire questions, Spencer. We go over these at the end of each show. We’re just going to work through these quickly and I just want some guttural answers.
0:52:23.0 First one is, what is the number one challenge for you to succeed and crush it in your role Spencer?
Spencer: 0:52:29.7 Being able to enter a market without an acquisition and grow to a sustainable point. I think that’s the biggest challenge.
Jordan: 0:52:43.4 Got it. So the cold start.
Spencer: 0:52:46.2 Cold start. Guess what, we’re moving to Indianapolis, and we’re starting from scratch. We’re going to put a team leader there that obviously has overhead and we’re going to make this thing work. In a year, we’re going to have x number of houses. That’s a challenge.
Jordan: 0:53:02.3 Where are you at in terms of being able to give that person leash? As you go into a new market and you’re still struggling, you and Matt, you’re still trying to figure it out, you’re going to have a little bit more patience and grace.
At some point, you’re going to know very clearly what the standards are to expect and that is directly going to hold this person to. Do you guys feel like you’re still in the process of figuring that out? Or do you have benchmarks that you feel like you can really dogmatically hold a new team leader to when they break into a new market?
Spencer: 0:53:37.2 Well, you know, I think that – for team leaders that go in via an acquisition, so like we did in Nashville and like we did in Chattanooga, it’s extremely easy. They have a scorecard just like everybody else and they’re expected to have a certain performance and they either – and they do really, really well, so – and there’s a lot of trust, because we’ve groomed these people from within GK Houses, they absolutely have been in all of these different roles within our company, so we move them through these different stages before we send them out to be team leaders.
So, I think when we move into acquisition, it’s fairly clean cut. 0:54:30.5 Moving into a market where there’s a cold start, as a fresh start, they’re going to have to be a part of the marketing program, and so we just put together – like this is one of the things I’ve been working on. I worked on it this month actually. Was just putting together a marketing plan for team leaders, because although a lot of it comes out of the corporate office, there’s going to have to be boots on the ground, and so I think we’re still figuring out what that looks like, so how many meetings have they had, how many investor meet ups have they attended. Things like that. We’re putting those pieces together.
Jordan: 0:55:15.6 So, you’re still cracking that nut. I’m confident you guys will figure it out. You told me a second ago. CAC, customer acquisition cost. Marketing only. That’s not packing in sales labour. $500, that’s the target.
But, my question for you is, how much is too much? What is the breaking point? You uncover a new source, the new all property management and you figure out that you can sustain a $750 customer acquisition cost, do you keep it on? Do you throttle it? Is it too high? What’s the breaking point for you guys?
Spencer: 0:55:48.2 Yeah, we keep it going at that rate. I mean, you know, we get kind of nervous at $1000 I think. Or not nervous, but we really start to evaluate, “Is it really worth it?” Around $1000 is that number.
Jordan: 0:56:05.3 $1000.
Spencer: 0:56:08.7 Yeah. And I think Adwords, at the very beginning, if — we were very patient and so, it was probably over that, but we dialed it back. We were able to fine tune it.
Jordan: 0:56:20.6 Awesome. Next question. What advice do you wish somebody had given you on your very first day in your current role?
Spencer: 0:56:30.4 Hmmm. First day? What advice do I wish they had given me? My goodness?
Jordan: 0:56:41.3 What have you learned man? Like, what’s the insight? What were you doing different then that you’re doing now that has defined success for you?
Spencer: 0:56:50.1 I think, you know, in my role I think I would have really probably jumped on Google Adwords sooner than I did. We probably waited a year, a year and a half before we really dove in and gave it a shot. So, I think looking back now, day one I would’ve started, I would’ve figured it all out a year sooner and been able to scale a lot faster.
Jordan: 0:57:20.5 Pushing hard on paid. Alright. So, final question for you Spencer. What is the number thing you see property management companies doing wrong when it comes to marketing?
Spencer: 0:57:31.6 I’ll start with just the most basic thing. When I look at the landscape of property management companies out there, I pull up their websites and I think, “Man alive!” Most of them are just brochure websites, and I think there’s so much – for your brand, for something you’ve put so much sweat and blood and tears into, I think you – people can do a lot better with their websites, and what I mean by that is, when people come to your website, they don’t necessarily want to hear all about you. They don’t care about you. What they want to know is what you’re going to do for them. What benefit would they get from doing business with you. So I would say one of the biggest mistakes is just having a brochure website. It’s a basic mistake that I think people make.
Jordan: 0:58:25.6 Awesome. So really, that’s a proxy for empathy. Right? Putting yourself in the consumer’s shoes and actually caring. Well said, and this is coming out of the guy that actually practices what he preaches.
Guys, if you want to learn more go to the website GK Houses, but then go click in at – GKHouses.com is basically a landing page, go check out some of their local market specific websites. Go to the owner’s page, download some of the resources. They do really interesting, innovative stuff. And we’re going to keep an eye on these guys. Track you as you are on your way to 25,000 doors. Spencer, thanks for coming on the show today.
Spencer: 0:59:09.0 Jordan, thanks so much I really had a good time. Appreciate it.