Since we launched back in 2017, our focus has always been on the nutraceuticals industry. Here’s why we decided to ditch niching down.
It actually started when I realised a problem after a morning conversation with one of my VAs:
VA: “Sal, Mark called again”
Sal: “What do you mean, I told him that we do not deal with department stores”
VA: “He insists, as he comes referred by our accountant!”
Looking back to 2017 when I transformed my consultancy to an agency, I decided to follow the wisdom of older marketing giants and niche down.
So I thought, I am most familiar with supplements. And what is the biggest problem with supplements? Nutraceutical manufacturers.
If you are a supplement brand owner and you are reading this line, you are probably nodding your head right now.
Try to contact any supplement manufacturer and you will be met with indifference. I mean, send an inquiry via their form – no reply. Call them and wait. Most likely they will tell you to call back or they will call you back – which never happens. Send them a message on Facebook (wait, what?).
So we decided to jump in and solve their conversion and marketing problems.
And boy, was that a ride. In the short years from 2017, when we started – we were the ONLY marketing agency in the entire world working with nutraceutical manufacturers exclusively – we managed to acquire huge clients from Germany, Belgium, Italy, Hong Kong and of course, the United Kingdom.
So eventually, managers and business owners referred us when they have a friend who needed help.
And we turned them down. All of them.
Whilst my wife (who is also a partner) was sceptical, she remained silent except for the hours we had our we-time.
“Do you think it’s a mistake to turn these people down? I think we are going to regret it eventually”.
“Nope, our market is within the nutraceuticals industry. How clients are going to react if they hear we are now taking customers from every direction? We stop being specialised and we lose our competitive edge”
“Ok, you are the expert.”
She was right.
I was the expert. But I made mistakes before.
Fast forward to COVID-era, we noticed a trend. People start losing their jobs. Business executives working at major firms are getting fired.
And then what happened?
They started their own marketing consultancies or “agencies”.
We start to feel the pressure.
Prospects we qualified and nurtured for months told us that they would go with a cheaper alternative, despite our warnings that people with no knowledge of the supplement regulations are going to burn their ad budgets and get their social media accounts banned.
But they didn’t listen – when you have the option to get a “Facebook consultant” to manage your Facebook ads for $200 per month whereas Centis was asking for $750, at best – what would you do?
You would try your chances with the cheaper option.
A few months later, I took a big decision.
In the middle of summer 2021, I announced the split of Centis into an e-commerce focused agency and the launch of NutraceuticalsMarketing.com
This was an effort to diversify – accept more customers from other industries and still serve our old and new supplement customers who wanted to know that we still specialise.
But this generated several new major problems.
Four Reasons Why We Took the Decision to “Kill” Our Agency
- We spread ourselves too thin. At Centis, before 2022, hiring people was a very difficult process (not because we want to be difficult people, but we owe to our customers the most quality possible). Ok, we are not Facebook or Google, but to hire someone means weeks of interviews, background checking, proof that our interviewee knows their stuff, plus training. Lots of training. In fact our new hires spend their entire first two weeks in getting trained, and then they start to slowly be deployed to customer accounts with the help of a surpervisor (and most of the times, this is me:-)
So we asked our current employees if they can handle more work and less “specialised” work – eCommerce.
They said yes.
They made a mistake too.
Our team of 35 people, previously trained in supplements and nutraceuticals marketing had to “adjust” to marketing eCommerce companies from every field imaginable – electronics, clothing, food, even vaping.
This meant that they had to figure out what worked in each industry and adjust by writing SOPs (Standard Operating Procedures), creating templates from scratch and more.
How we solved this problem:
After September 2021, we started having second thoughts about the whole idea of opening up and offering a multitude of services to eCommerce AND nutraceuticals.
With the previous month’s experience, and having a new model at hand, we sat down with everyone, put benchmarks and completely revamped the service offering.
We now offer just three services for our core offering (web design, ads and email marketing) and completely streamlined our processes, hired a training company to provide to also revamp our training process, making the training faster (but more efficient) and now we do not have a limit on how many customers we take. The sky is our limit 🙂
2. We lost the ball in promoting our own agency. Ever heard the proverbial saying “The shoe maker’s kids have no shoes”? Thist was us. With two own brands to promote, centis.net and the now merged nutraceuticalsmarketing.com that meant we had to post content into two of our own websites, update eight different accounts on social, create an additional email sequence, automate everything from scratch tailored for eCommerce clients and much much more.
But wait, Sal, is that what would you do when you have customers? You are correct. The truth is, we didn’t invest in our own marketing, saying “Nah, I will post an article later”. We didn’t really care as our priority was, and will always be, the client
Bottom line? We did the bare minimum and we lost credibility by not promoting ourselves regularly.
How we solved this problem:
For starters, we merged the two sites into one and repositioned our offering to just three services, not fifty as before. This allowed us to split our team into two groups: the people who will handle the core services and the people who will handle the Full Stack.
Then, we simply hired and trained more people AND placed three people to write and promote our agency. Problem solved.
3. At the nutraceuticals niche, the prospect pool was too small. We eventually hit a point where we ran out of prospects so we had to go back to past prospects, pestering their inboxes. A big no-no.
How we solved this problem:
By repositioning our agency to accommodate more businesses that need our help. Creating a product that really is affordable, is streamlined and nearly anyone can buy was a big, internal win for us. At the end of the day, we stopped niching on industry and we niched on services.
4. The nutraceuticals industry is too secretive and we couldn’t show our work. With every new client, we signed an NDA, which means that we couldn’t publicise our work. This eventually came back and bite us in the #$%^s, as EVERY client wanted to see examples of our work. When we finally found a way to actually create screenshots with redacted brands and products, they thought they were fake!
How we solved his problem:
By repositioning our agency, NDAs are a thing of the past. We no longer accept working with an NDA and we also make an effort to publicise our work, which in turn, really promotes our agency culture, ethics, and effort.
So I had enough. But I was scared to make a change and I didn’t know what to do.
Until it hit me.
Centis was already a productized agency, meaning we didn’t bill on a per hour basis, but clients would select a package (with some necessary negotiation of course) and then we delivered our services on a fixed fee.
So far so good.
What I didn’t know is HOW I could expand our services to more people that needed them, since we were already an expensive agency (hence, the cost of specialisation).
So I spent the entire September, November and December working on different business models but it all came back to the same conclusion:
Centis should stop being so specialised and expand to whoever needed its services.
So, at the beginning of December, I presented my team the view for the business:
Scrap the point-based fee, enter the monthly fixed, max-three-services fee
For a low monthly fee, instead of shelling out thousands of Euros for a website, clients will be able to have a beautiful website and very specific marketing growth actions, like a newsletter, a CRM, as well as Facebook and Google ads to help them grow.
We had to tell our customers about it.
Of course some people will be disappointed.
But what we did is that we kept our legacy clients as they were – and in some cases, we lowered our fees.
Without a doubt, some clients will hate working with us. Whilst nothing will change from our end, some clients specifically came because we are (were) so specialised.
But having a very clear 12-month goal makes our decision much easier.
Centis was capped by the small volume numbers of the nutraceuticals industry. The new goal is to be able to help 10,000 businesses by the end of the year, so we need to innovate and keep our resources focused on that goal.
And as much as it hurts to change the entirety of our website, our business model and our product offering, we need to.
How To Implement Change In Your Business As Well
When you have worked your ass off for a few years to perfect a business model that works, and then your reality changes (actually, everyone’s reality changed since 2020) – it is extremely difficult to accept that you have to erase from the map what you have created and re-build.
But with adversity comes opportunity, and this is an opportunity for you to really look hard on your product – and your clients and ask yourself:
Does your product or service:
- Deliver substantial more value to your new customers than if they were using a competing product?
- Clearly have a direct impact on you meeting your goals as a business?
- Clearly have a direct impact on client’s lives and businesses?
If the answer is “no” to any of the above, maybe its time to make some tough choices.