048 - Increasing your margin with David Braun

Agency Highway
Agency Highway
048 - Increasing your margin with David Braun

David Braun has been in the agency game since 2002. Yep. Two thousand and freaking two. He’s also a co-founder of TemplateMonster, Weblium and Drafitum, and speaks at 70+ conferences. So to say he has learned a thing or two is a massive understatement.

In this chat, David and James talk about how to increase your digital agency’s margin and profit. Most people focus on getting more clients and hiring more staff - but this doesn't mean you’ll actually make a profit.

There are much simpler ways to make more profit - by being more efficient and leveraging the clients you already have.

We talk about several ways to increase your margin, including:

  • Properly tracking project expenses
  • Not using fake conversion rates
  • Upsells and cross sells
  • Tools and processes

David has been kind enough to offer Agency Highway listeners 50% off the annual pro plan of Draftium using the code CS-DRFT50. This gives you full access to Draftium premium features for $49.5.

If you leave a review on any of the platforms - itunes, stitcher etc. Just screenshot it and email it to [email protected] and we’re giving away a full year of access every month. Let’s just say you’ll have pretty good chances because we’re not a huge podcast and there won’t be hundreds of entries

Resources mentioned in the episode

Connect with David


James Rose:                       Welcome back to another episode of Agency Highway. I am so excited about today's guest. I have with me, David Braun of, I want to say TemplateMonster but really it is a lot of stuff. You do a lot of stuff David, thank you so much for joining me.

David Braun:                      Yeah, thank you for having me.

James Rose:                       I'm just looking through your profile here and it's like a TemplateMonster, Weblium, Draftium. And obviously TemplateMonster has been around forever, and you've been around in web development forever. And I guess I was introduced recently to Draftium and when I saw it on Appsumo and I was like, Oh man, like there are so many sort of connecting dots here. And you know, we've got a little, we've been doing some joint promotions of Content Snare and Draftium lately, so that's been really exciting. So I thought it made sense to get you on the podcast. So why don't you give people a little bit of background in case I butcher it?

David Braun:                      Sure, sure. Absolutely. Yeah. Hello everyone. My Name is David Braun. I am a co-founder of TemplateMonster. It happened... I'm a dinosaur in internet I think. Before the Google, you know, like it was in 2002 and we were growing, you know, like crazy. We all started in a two bedroom apartment in Ukraine basically. So, like it grew up to 650 employees, 17 offices around the world. And then in 2015 we did a large exit, to a private equity company firm. Right now, I'm almost 40 years old and we kinda, with my partner felt retired because we made a lot of money, you know. So we started to think, what are we going to do next? And then you know, like, so we wanted to do like a totally different thing from web development cause like all our life was around web development.

David Braun:                      And then when we started to kind of look for alternatives and it kind of boomed in my head. I felt like, you know, what if we start doing some AI or machine learning or you know, CRM system or you name it. You have no competitive advantage because we spent 16 years of our lives learning how people make websites. So the next project should be definitely around making websites. Otherwise, you know, we kind of be on the same conditions with any starter. Who just came in, has no sense. You know. So we wanted to capitalize our experience and that's how we started. Because the behavioral habits changed a lot. Now people are lazy. They want one click for everything. One click solution for having a website, one click for running an ad campaign, one click for making a sale and so on.

David Braun:                      So we started to think, okay, we have to kind of propose people one click solution for making websites. And that's how Weblium idea was born. And you know what, like our mission was to create a McDonald's of web design industry. Like to have 1000 websites a day, like custom websites in a day. And when we started, my first feeling was that the main challenge would be how do we acquire 1000 customers every day. And it turned out to be that not the production process was the biggest challenge. So we fortunately partnered up with a couple of banks and they started to send a lot of leads to our way. And I found that the main challenge was how do we actually fulfill the project because the customers are tough, you know, like they promise you to bring them some content.

David Braun:                      But in fact, I'm sure a lot of agencies is actually listened to us and they know that the main job for an agency is not to sell, but actually to beg for content from a customer. You know, they send you a logo one day. They send you a one paragraph of text, another day. They promised to send a couple of pictures another day and then instead of making websites within 48 hours as we promised, we end up with having, you know, projects completed in two weeks and it's not scalable. Right. So I said, okay, now we have to kind of reconsider the whole process from the beginning. And most of the expensive agencies, what they do, they prototype first. Approve the prototype with their clients and only then they start the production. So I bought a lot of, I signed up for thousands of dollars you know, worth of subscriptions with Balsamique, you know, UXPin, you know, Moqups.com, you name it. Every possible mockup tool.

David Braun:                      And the biggest issue was actually to prototype using this tool to prototype a five page website. It takes you, you know, same amount of time as you actually build it. So it's not scalable at all. So that's how we, how we came up with Draftium, which is the turbo prototyping tool. I'm sure you use it already, and it's like takes 10 to 15 minutes and you can do it online simultaneous with a client on a conference call and it creates a wow effect, you know, cause like lots of people say wow you are, my website is actually building up right now.

James Rose:                       Yeah. As we're on the call. That's awesome. And it's funny, almost, to go back right to the start there before we dig into this. Because you said you started before the days of Google. I have to ask, how did you even get clients before Google and Facebook?

David Braun:                      Yeah. You know what like actually funny cause it was a DMOZ.org directory. What we did was like a super simple and stupid strategy. So we came to this DMOZ get one vertical for example, pizza shops. So you get all the websites for pizza shops and send an email, just direct cold email saying, Hey, I found your website. Honestly it sucks in terms of design. Take a look at our, you know, templates, we have like 10 or 15 designs for pizza shops. It's cheap, you know, it's easy to make it. And we were sending like 1000, 2000, 3000 emails a day and a lot of people that actually came back and they started to converge. You know, and then I created an affiliate program. We had that 2000 to 200, 205, I don't know, like 300 almost 300,000 affiliates.

David Braun:                      When you Google for anything website template related, first five to six pages were ours or our affiliates.

James Rose:                       Yeah, I remember and that was kind of like the affiliate heyday there. There's so much going on in affiliate marketing back then. But, I know that's not like super helpful anymore because it's not 2003. So, yeah man, like you guys are doing so much now with Weblium and Draftium and obviously you covered Draftium there a little bit. So, for listeners who aren't familiar with it, I mean we've got a pretty good description but already, but it's a great, great little wire framing tool. And I can't emphasize the importance of that "Wow" factor enough when you are,... It's basically a quick win, right? Like one of the best ways to impress your clients.

David Braun:                      But the main value I think for an agency to use it actually to increase their margin. Because like most of the agencies they do not really calculate properly their prime costs for the project.

David Braun:                      And this is like, what really hurts their margin. Like when you take a look at the yearly margin, average margin, you know. They usually have like 30% margin versus they should have at least 50 because they do not include enough. All the expenses that they did not include the tools that they bought, you know, to operate. Do not include the licenses for stock photos, you know. Do not include those back and forth communications. So if you can decrease the back and forth communications because the agency only sells their time, right? So this is the only limited resource in the agency businesses, is their time. So that's why the agency business is super hard to scale because the time is not a salable resource. But then you know, like if you want to scale, the only thing that you could do is you only,

David Braun:                      More efficient, in using your time, right? So if you decrease the time spent on the client, we call it, discovery phase, because the content discovery phase, the brief discovery phase. So if you can decrease the two times, that means that their margin is actually increasing around 30% you know, for the total time spent on the project. So that's why I always like talk, a lot of agencies in the beginning they are kind of skeptical. They say, Oh yeah, yeah I know that's a lot of, you know, mock up tools around there. We don't spend all this time. We just like ask the client to create a brief and then we start from this. You know, point. And then I said, okay, let's have a bet. I give you five years Draftium for free, If you win. If you don't win, you just go and buy it for five years okay? Sounds like a deal, let's do it. So, and then we get two projects simultaneously, you know, we get randomly two projects by an agency and then I supervise the process and then I can prove easily that using Draftium they can decrease the time spent on the discovery phase, 30% at least in most cases, 50%. Not to mention that they actually kind of clarify a lot of points, which kind of decreases the number of revisions afterwards because revisions, that's what hurts our margin the most.

James Rose:                       Yeah. And I mean, you said, one of most important things that I took out of that is, it's just that time is the most precious resource that agencies have. And this doesn't even apply just to agencies. You know, this is a really, really big passion area of mine. Like saving time and doing less work because I travel a little bit in the digital nomad community. Like people who are doing remote work and the amount of times I've just seen people like having to be on their laptops, like constantly to do this thing and that thing and that thing. When some of us who have got better processes and automation in place are able to go and hang out and sit on the beach. Like I know that's Cliche as hell, but we literally were sitting on the beach in Bali while some people had to do work and like, that drives me insane because it only takes a little bit of time and sure there might be some costs involved, but when we're talking like let's say a tool is like 20 bucks a month or 50 bucks a month, but it saves you all this time.

James Rose:                       And I know Draftium is way cheaper than that too. So it's, It's just funny the, I guess the attitude to saving time. I think to me it's like so important and I just really want to emphasize that.

David Braun:                      Plus, you know, like most of the agencies they feel like if they do not, you know, save the time, they actually have no ability to sell their time. So they do not consider the time as an asset. They consider it just a resource. But if you take a look and see that your real time costs, you know, certain amount of money depending on how much you charge per hour. Right. You can always sell this time if you cannot sell it directly by approaching more clients or you could do like, you could sell it as a subcontractor. I know like for example on Weblium when we do not have enough orders to fulfill and we have time left, we sell this time cheaper to other studios. We basically have a service called studio for studios. Most of our people sitting in Ukraine, it's like much cheaper than US or Australia or you name it.

David Braun:                      And so we can, what we can do, our retail price is about 20 bucks an hour. But when we have some time left, we sell this time 10 bucks an hour. But we still, you know, capitalizing and monetizing this time instead of just having an empty time. So this is like another way to kind of look at your ways, how to increase the margin for an agency. So if you do not have all the time sold, you sell it for a cheaper rate to other agencies. So this way you do not have a price down dumping strategy. All the retail pricing stays the same. But then you have like kind of B Two B pricing. Right. Which is also works.

James Rose:                       Yeah. And I guess it's, almost like the white label model. Some people make that their entire, but you know it's funny cause, you mentioned that, because I've had this experience when we were quite heavy in the web design space with our agency. Sometimes I would have, you know, maybe two or three projects end at the same time. And I'd literally just jump on Facebook cause I've got a pretty sizable network of business owners and just say, look, I've got two of my guys are gonna be available for like two weeks. If you guys need any stuff done on your websites and I'm just going to give you a cheap rate. And it kept them busy and like every time someone would come back and be like, Oh yes, I need some help. So it was kind of like a mini version of that. You know.

David Braun:                      The important thing is actually to track it properly. So we have like a CRM system, project management system. We, because I was inspired by The Founder movie. I'm not sure if you watch that. Yeah. The McDonald's guys. Remember when they were planning the kitchen, you know, and they, or optimizing all the positions of the people on the kitchen and then everything, so like to minimize the time to prepare the food. So we kind of have execute the same strategy. So our first step was to actually kind of chronic, you know, with a chronometers. We were tracking the time for every single operation. And I was so much surprised, even after 15 years in business. I was not really seeing how much, you know, wasting, time waste operations we have in the processes. For example, a brief, the brief by itself, is dead. You know like, cause a brief does not engage, you know, the customer.

David Braun:                      So a lot of customers approach two or three agencies at the same time asking about their project. And all of those do not jump on a call or do a prototype. They just send you a brief. So eventually the customer gets bored by, you know, filling up all these forms, and he says, Okay, whoever calls me the first, I will work with this guy. So this way a lot of agencies actually, you know, dropping their leads and they're killing their conversion every time they sent to someone a brief. I always like saying, if you send the brief, you already 50% killed your conversion.

James Rose:                       Yeah, I can see that making sense actually because I mean I was never one to send briefs cause I know there's like all this time goes into them. I mean I think it's okay to maybe do a brief if you're getting paid for it, but then it's more of a discovery at that point, right?

David Braun:                      And I think it's your job. It's the job of an agency to complete the brief. So you talk to a client and you'll ask him proper questions. And during these questions, he provides the answers and then you kind of submit the brief and then you have an overview and a summary and send for approval to a client. Our winning strategy is, we do a draft in a Weblium Studio when someone wants to have a website. We do a draft for free and then we send it over to a client and say, now you are free to go and ask for a quote to any other agency because we are hundred percent sure we provide the best pricing available. And you know what? 90 per.... It creates a lot of trust and 90% of the customers, never go elsewhere, never ask anyone else. They say, okay guys, since you already built a prototype, you know, I like it. You know, I want you guys to complete the project for me. I don't want to go elsewhere. You know like, and start talking to random people. You know, I want to work with you.

James Rose:                       And how long would you spend on a prototype?

David Braun:                      20 minutes. 20 minutes max cause on Draftium, we got plenty, 350 templates. So basically like the first draft you just change a logo, company name, you know, do a couple of slogans and the personal already sees that you are capable to do the job. And then you know like you get the prepayment and you start working. So it's really like 15 to 20 minutes of your time. But you sell your attention to a client and the client really like, starts feeling the trust and you know, this is how it starts. So I think that this is like one of the most valuable conversion optimization advice, you know, I can get, cause like it really works.

James Rose:                       That's awesome. I, my brain's kind of spinning here. So, this is something we talked about offline. You mentioned conversion rate a couple of times, about like the way people calculate it and then, and not like it's kind of like a fake conversion rate.

David Braun:                      Yeah, sure. So I found that the most agencies, they have like a fake conversion rate because they kind of feel, you know, bad when they realize that their conversion rate is so bad. So they tried to kind of, start calculating not from the first top funnel, you know, top level of the funnel. But from the second one, when customers already deeply approaching you, asking you for your rates, asking you for your brief and you know, like things like that. But the top level of the funnel, is actually your first contact with the customer. For example, you went to a workshop or you went to a local meetup or the businesses and then somebody approached you and say, Hey, my name's David was your name?

David Braun:                      I give you my business card, you give me your business card. You say, I'm an agency, I do a lot of work for your niche or your vertical. This is your top level of the funnel, right? So when you go back, you'll have to immediately put this contact in your CRM and start calculating the conversion rate. Most of the agencies don't do it because they say, this is just a meetup. You know, this is my contact it's not a lead. So the lead starts when David will call you back and say, Hey, I want to project, you know, like I want you to make a project for me. This is not true. You know? And so when you start calculating your first level conversion rate, it kind of drops you, you know, your conversion rate 30% or more. So when I had the same, you know, when they started to train my sales department in Weblium, they had so many contacts. They had thousands of contacts, but they were not considered as leads. Because they see, this is the difference between proactive approach in reactive approach.

David Braun:                      Reactive approach means that somebody should approach you first and then you start, you know, kind of answering. The pro active approach means that you already establish some contacts and now you have to approach them proactively and actually start, you know, trying to make a project out of it. And a lot of agencies are too shy for some reason. I have no idea why you know the agency business. I think that because the agency business is most in most cases is the founders business. So the founders are making the business. So the founders is kind of feeling, I think, VIP for himself. You know, he's already too important to kind of proactively do the stuff. So they're waiting when someone will come in and ask for help. I have in Weblium, already 75 people to feed. You know like so I have no pride for, you know, for myself.

David Braun:                      Like I'm VIP guy. Although I sold the company for 100 million plus. You know like, I could be on an island with Richard Branson and listen to this, you know like, bullshit about the leadership and stuff like that. I said I'm working on the field. I go to the field, I meet my clients. Even if they are not feeling my clients yet, you know, like I'll start talking to them. I'll start engaging with them, I'll start proactively showing my expertise in earning the trust and after that they become my clients. So a lot of agencies don't think this way.

James Rose:                       And how would you say is the best way to I guess go through that phase of earning their trust? If this is someone you've met at like a local networking event, which is where I know a lot of agencies get their first leads. How would you start building that trust?

David Braun:                      I just talk to this guy and say, Hey, you know, like I actually like very, you know, open minded person. So I ask people sometimes strange questions like, so you say for example, I'm in an agency business. I say, okay, what would you consider like top result for this, by the end of this year? What should happen that if you are like super, super great, you know, achiever by the end of the year. And usually these question opens up their mind and say, oh, I did not really set this ambitious goals for myself. But I said, but what if you start right now? What should it be? And then you say, okay, I would feel proud, if I engage, I don't know, Walt Disney as a client. And say, okay, what should happen? How do you approach it? And then I start on the brainstorm together with you. Saying, to engage you can go to LinkedIn and find all the people responsible for digital media, digital presence. Start engaging with them.

David Braun:                      Build a LinkedIn campaign, show your expertise, maybe you should publish in Entrepreneur magazine or somewhere to show that you are an influencer. And then you could do a retargeting, personally to these people. So they see your face and that you are an expert. So I get to help them, you know, like formulate their strategy and then I say, okay. If you don't know how to do it, we could, for example, do a great landing page for you as an influencer. We could try to pitch you to the media and so on. And say, Oh yeah, that's great idea. Let's do it. You know, so you create an opportunity first. It's called future pace thinking. So, you are kind of putting the customer into the future and it should be great future or you know, like it should be maybe, best future or whatever. And then you show that during the path to this future, you are nearby. And if the customer kind of sees that you are nearby during this path to the future so you can help him to reach this future point, Then, you know, like he usually wants you to be, you know, together to share the risks.

James Rose:                       Yeah. And you've led with a ton of value too. Like you've given them a bunch of stuff and said, this is kind of what you need to do.

David Braun:                      Yeah, yeah, sure, absolutely. You're not really like selling the bullshit. You really like kind of feeling that you can contribute, you know, to this future path.

James Rose:                       Yeah. Awesome. So let's talk a little bit more about, increasing margin coz I know that that's kind of like our overarching topic of this interview. And we talked about, you know, sort of increasing margin through, I guess I would call it like getting more value out of the clients we already have with, without sells and cross sells. Do you want to talk about that for a bit?

David Braun:                      Yeah, sure. So many people consider agency business as a sort of a boutique, you know, a boutique lifestyle business. And that prevents them to see the business from, you know, from a digital business perspective. Take a look at the e-commerce. In e-commerce, the only thing that you make money actually. So you have the lead magnets or it's required products and then you have a main product to cross-sell and up-sell. So I started to think from the same perspective to the agency business. And say, what we could up-sell and cross-sell? So this is how we came up with cross-sell and up-sell strategy. So we up-sell a lot of additional services from our partners, and you make a commission as an affiliate. Also you can up-sell this, we sell this pre-packaged webmaster hours.

David Braun:                      For example, you complete the project already, right? There is a great rule called zero invoice rule. Let's say you charge the client $3,000 and you already charged him. You deliver the project and he's happy. Then after one week he comes back and say, Hey David, you know what? I need to change this little thing, I need to re-color on this button. You know, so it's a little work. You do not have a moral right to charge the customer because you just charged him $3,000. So you don't want you to look like a moron, right? So you say, okay, I'll do it. Then you give it to your guy and your technician right now spends, I don't know, one hour or one and a half hour to actually change this button. After two days he comes back and says, David, I also like, we have a trade show tomorrow.

David Braun:                      Can you update our newspage or do something, you know, like little stuff. And then he comes back again and again. And you still cannot, you know, charge him more because you want to retain this client, you know, relationship. And I found a way to do it. When he asks to do this little thing, you send him an invoice. We call it zero dollar invoice. Where you put a charge, the price that you would charge any other guy who would come, you know, if he wouldn't be your client and you say, okay, I will charge for this, I don't know, $50 and then you say your discount is 100% and your invoice is zero. Second time, you also do like, this would cost you $150, but you have 100% discount as a loyal client and your invoice is zero. Third time when he comes back, you say, you know what, I see that you will always need our help. Let's sign a contract for support of maintenance work, $200 a month. You know, you'll always have our guys ready to help. So this creates, you don't look like a moron. You've already given him away free work, but he already recognizes the value of this work, right? And when he repeats it, you already opens, It opens up an up-sell opportunity for you easily and in a very polite way. One-way to do it, right?

David Braun:                      This is like a little trick that you kind of learn it and it's like super, super easy to implement. People value it a lot because if you do it for free, people do not really feel devalued at all. They see, okay, so he continues to send you a lot of work and this time could be sold to other clients. So this is how, what, how it hurts your margin because you could sell this time for money instead of your work. Instead of this you work for free and we already discussed it. The time is the only limited resource that you have in your agency, right?

James Rose:                       Yeah, absolutely. And yeah, I mean this is the classic up-sell for Web developers is to get them onto a support and maintenance agreement. I really like this idea.

David Braun:                      And a cross-sell, What could be a cross-sell, you research the vertical of the client. You ask for his challenges, then you find tools. Like we discussed automation tools but not automation tools for yourself, but automation tools for the client's business. Then you reach out to this vendor of automation tools and say, Hey, I'm an agency. Do you have an agency plan? You know like usually they give you a special discount starting with 30% in most cases, 40 to 50% and then you implement this and then you can charge also set up fee for a client to atleast, you know, set up all this automation tools within his business. And this way you differentiate greatly from other agencies because most of the agencies they will do what they do the website, they do the coding and they have no differentiate point.

David Braun:                      The only differentiation point you you might have in this case is your pricing and the pricing never works because there is a lot of people in India and Pakistan, even in Ukraine that would, you know, would charge cheaper. So you cannot differentiate on pricing. It never works. You know like because markets changing. I can give you an example that people do usually forgot about it. But in 1980s, Japan was the place for cheapest engineering, you know, workforce. So people use Japan as we use China right now for cheap engineering labor. Now you see Japan is one of the most expensive, you know, labor cost country, right? So, markets are shifting a lot. You never, you can never predict, if your business, you know, a business usually. You know, you can be in business for 10 to 15 to 20 years. You never rely on pricing, never, you know, you have to differentiate. So you have to be, you know, experts in some niches. So that's why the cross sell, you know, strategy usually is in automation. You help to automate processes for your client and this is your differentiator point.

James Rose:                       That's a great point. With the automation and stuff. I think there are a lot of agencies. I see this pretty regularly in our community, is people taking on more and more services where you know, a client goes or they see an opportunity to offer Facebook Ads and next minute they're doing Facebook Ads and Google Ads and design and, like there's a massive list of services. But something you said earlier about working with other partners and taking like a commission on other work, you know, I think is a really good idea in a way to get out of needing to do, like to back yourself into this hole of having to do so many different services. And the next minute you're back to just working all the time. Like as an example, I'm doing a little bit of automation work at the moment, so, but like more like videos and showing people how to do automation.

James Rose:                       I don't really want to do it one on one for businesses. It's just not where my passion is. I like creating sort of videos and helping lots of people. And I met a lady at a conference recently who does exactly the stuff that I don't want to do. So it's like the perfect partnership, right. And I can go, okay, someone wants help with this, go and talk to this lady, we're done. And I can kick back, you know, I don't think in this case I'm going to ask for a commission. But you know, I've seen a lot of people do that and I have other people like web developers that when I send them a lead, they will pay us 10% of the jobs. So I think there are ways to, to add more services and cross sell without doing the work yourself.

David Braun:                      Yeah, exactly. Yeah. Because like eventually you are, you know, ending up with your time slots are super busy, you have no time to think about your strategy. You have no time. A lot of agencies actually convert. I think your story is like that. Right? So you started as an agency and then you created the product based on your experience. So most of the agencies they end up with creating the product because they realize in their head that it's never ending stories not scalable. So in other way to look at this, what in Weblium, we do a franchise. So we do a franchise agency. You never had an agency, we give you the tool to build sites. We give you a prototyping tool, we give you a business processes and then you can start running your agency. And so this is the way we scale.

David Braun:                      Otherwise, you know, like we would end up with already, okay, I have 70 people, I will have 200 people and this is going to be my end. You know, like there's gonna be a lot of, a lot of you know, things. For example, if you drop the project in the middle, you have a developer, WordPress developer and he's starts working on the client's project. And then you know, like you lose the developer, I don't know, he changed the job. She decided to leave the company. What happens next? You hire another guy always in 90% he says, oh, this previous guy did it wrong way. We have to Redo it.

James Rose:                       That is a classic developer.

David Braun:                      And then you know what, you pay double. So i's first your margin. In Weblium, let's say you dropped the project on 75% completion date, you start with 76% immediately because we use the same system behind. You can give it even to us and say, guys, you have to complete it because I have other projects to do. Right? So that's why we have to create the Weblium as a system which consistently can, you know, like work the same way. There is no other way to build a website. You use only one way with WordPress, we have so many issues, you know, when you change people, you know, like so many issues. We always were thinking at the beginning that we would make 50% on this project and we ended up having, at least, you know, 15% or 20%. This is not the business. This is a hobby.

James Rose:                       And basically touching on another great way to increase your margin, right? And having these rock solid processes. I didn't know that you guys were doing like the franchise model with like, with processes given to people as well. Coz that's really important. Right? Like that's, especially when you're trying to be more efficient with your time is having the right tools and processes in place to reduce your costs essentially. Like, you know, whether that's cost of switching a developer or using your own time or whatever.

David Braun:                      Yeah. Also like another thing, like people are spending a lot of time by, you know, trying to select the proper stock photos for people. Like I know, like the couple of pages that came to us and we were willing to, we started to track their time. They say, oh, we spending like two to three hours and they charge these, you know, amount of time or included to the project cost to find the proper clip art. Why don't you do, why do we do it? In the first place, why don't you ask your client? There is, I don't know, Shutterstock. Give him a Shutterstock website, and say, please can you find the pictures that you like and then you kind of offload this job to your client. And if he cannot do it, he would value this job, you know, if you would do it. Otherwise the client does not really recognize that there is a job behind it, right? So I always like, prefer to have a transparent way to kind of offload all the job to a client site. Yeah. And when his brain is blown up and say, hey, I don't want to do this shit and you say, okay, we'll do it for you, but we will charge for it right? And now, he's ready to pay. Otherwise, he's not ready to pay.

James Rose:                       That's a great example coz looking through stock photos can be such a pain in the ass. And that's what we ended up doing actually, is using basically just asking them to send us a link in Content Snare. Like send us a link of the photos you want and then we would go and buy them because we've got the account to deposit photos or Shutterstock or whatever. Right? We'd say these are the sites you can use, and then when you pick your link, like just literally send us the link, find the picture, copy it out of the URL bar, put it in this box in Content Snare. Hit that you're done. And we will go and buy it and use it on the website.

David Braun:                      Right, right. That's a good strategy.

James Rose:                       So I think, I mean is there anything else you'd like to cover? Like around increasing your margin before we start to wrap this up.

David Braun:                      Another thing that I would cover is actually when you start having this tracking triggers in place. You track all the possible jobs. There is a framework called service blueprint, just Google for it. So basically service blueprint is actually your not paying all the processes with your time. What you have to do with as an agency and what actions customer has to do in order to, you know, work within the project. And then you realize all the actions that both sides are doing. First effect, you actually eliminating some of those because you see that this is unnecessary. This could be dropped off, you know, like, and things like that. And the second you realize who is doing a particular job. In some cases your most expensive people doing, you know, a dummy job. Like, the main developer who gets there, you know, like the highest salary has to, for example, copy and paste a lot of content. Why do we need it? Get a junior assistant for this, right? Have him he prepare everything and that way you minimize the time of the highest paid person in company. So take a serious look at the people and their salaries and identify their internal rate, hourly rate and you know, analyze what you could do is actually, you know, to have a minimum spend internally on certain operations and it will help you to increase your margin 10 to 15% too.

James Rose:                       And I think when you're doing that process, it would make sense to include an hourly rate of your own time. I know the tendency is for people not to count their own.

David Braun:                      Yeah. And it happens, you know, at the end of the day you say how much is your agency making? And he says, Oh, I'm making a hundred thousand dollars a year. They say, do you pay yourself a salary? they say no. I say, okay. What if you would go have a job, a daytime job, how much would they pay for your expertise? Oh about $150,000 a year. So you basically have a loss.

James Rose:                       Yeah. Right.

David Braun:                      So like this is important thing. Like you'll have to pay a salary and market salary to yourself or at least include this, you know, into the calculation and then see how much is your agency really making.

James Rose:                       Yeah, absolutely. And I think this is, I mean it's quite difficult to do to track project costs to that kind of detail, but I think it is important because it helps you find where those areas for massive improvement are. Like you said there, you've got the highest paid person in the company doing like menial tasks that a junior could do or even like a virtual assistant could do. And that's, where you make massive savings and increase your margin. It's just, right. Exactly. So, look, if you guys want to get a hold of Draftium. I see that we've got a little code here because. I mean this is a classic great tool to fix up your processes or improve your processes, especially in that early stages during the discovery. And like David said, wowing clients straight up, I mean this is one of the most important things that I've found you can do getting little quick wins for clients. So, I see that you guys, David have arranged a little deal here using a CS-DRFT50, oh man, that's complex. I will put that in the show notes as a coupon code to get Draftium premium for, it's like 49.50 a year, which is insanely cheap, but I know, it's free anyway, right? To sign up and start playing around. So guys.

David Braun:                      The thing is like the paid version, why people ask for a paid version, they want to brand it by themselves. So they want to use their own domain for, to host those prototype, right. If you don't want it, you just can use free version. You know, like it's completely available. Enough to actually start playing with this. And I would suggest you also like to have a pair, but I think we have a perfect match, Draftium and Content Snare. So like you build a prototype, you approve it with your customer and then you use Content Snare to collect all the pieces of content needed to start the production. And this way you minimize your discovery phase. You maximize your margin, you make enough profit. Then you could be the next guest on this podcast.

James Rose:                       Boom. Mike drop. We're done. Yeah. Honestly, that is such an awesome combo. That's why I mean I started off talking to you guys because I think it's just, it's solves two of the biggest issues in web design. Like, I feel like I'm big noting myself here, but I mean that is literally the reason we built Content Snare is because it was a big pain in the ass for us. And it sounds like that's the reason you built Draftium cause it was one of the biggest pains for you, right? So that's classic. yeah. Thank you David. Thank you so much for joining me man. This has been awesome.

David Braun:                      Yeah, thank you guys. I wish you have highest possible margins by the end of this year.

James Rose:                       Absolutely, and remember jump over to the show notes at agencyhighway.com. Search for David or Draftium and this episode will show up. And just in case it's CS-DRFT50 to get Draftium premium for basically 50% off. So, and that will be in the show notes, so you don't have to remember it or you write it down, if you're driving or something. Please don't do that. One little extra thing I'd like to do this week. If you leave a review of Agency Highway on any of the platforms like iTunes, Stitcher, whatever, just screenshot it and email it to [email protected] and we'll give away a full year of access to Content Snare every month. Let's just say your chances are going to be pretty good because I'm only just doing this and it's not a huge podcast. So there's probably only going to be a few of you in the drawer. So send those screenshots of your reviews over to [email protected]. Love you guys and I'll see you in the next episode.