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Eureka! How to Generate Leads Using the Lighthouse Client Strategy

Over the years, one of the most requested topics that agency owners seek my opinion on is how to generate more leads and grow their business.

Whenever they ask me that question there’s always one thing I tell them. I tell them that of all the issues that agencies have, lead generation is one of the easiest issues to solve. 

(The hardest challenge, by the way, is retaining clients as your business scales, and keeping operations tight.)

When it comes to lead generation, here is the strategy I recommend to all agency owners, regardless if you’ve got an established business or are just starting out on your own.

It’s called the Lighthouse Client strategy.

What is a Lighthouse Client?

A lighthouse client is a client for whom marketing agencies can always deliver results because they’re easy to work for, provide the most revenue, and fall in sync with the agency’s expertise.

This strategy is all about how companies can hone in on a particular niche that they aim to serve. Your niche could be anything ranging from restaurants to dentists to real estate agents.

When it comes to choosing a niche, it’s common among new marketing agencies to not choose one and instead take any leads that come their way.

A person has to start somewhere, right? So, most new agencies take any client who approaches them. Such a practice is also common for agencies that are not seven-figure businesses.

Here’s the deal-breaker. If you say yes to everything, you’re hurting your business in the long run. It puts you further away from being able to have perceived authority in a particular area.

One of the best methods for agencies to determine their niche is to do the X-Y-Z exercise. In this exercise, you fill the blanks for a simple statement that reads:

“I help X achieve Y through Z.”

The X-Y-Z Framework

Agencies that completely own a niche will always have more perceived authority as opposed to those that cater to all markets.

For instance, between the two statements below, which do you think will have a bigger impact on a prospective client?

Statement 1: Restaurants are what I focus on. I’ve done this many times and I’ve got lots of restaurant owner references.

Statement 2: I cater to restaurants, chiropractors, real estate agents, eCommerce startups, etc.

Statement one positions an agency as a company that has more domain knowledge and can provide proven value to their clients as opposed to a company that’s a “jack of all trades and master of none”.

And with the X-Y-Z framework, agencies can:

1. Figure out who they’re targeting.

2. Determine what they want their clients to achieve.

3. And choose the strategies they want to execute.

How does the Lighthouse strategy work?

Finding a lighthouse client is like finding the “why” of your existence. Finding the why gives you a purpose. Having a clear purpose makes it easier for you to get more clients.

It goes without saying that the amount of effort an agency puts towards servicing five random businesses would be colossally more compared to servicing, say, 50 doctors.

What I tell every agency owner I meet is that there is tremendous power in the concept of perceived authority, irrespective of whether or not agencies are actually better at a service. 

When businesses have that authority, they can actually charge more too. For instance, if a patient goes to a family doctor, he/she would pay less when compared to going to a specialist who treats a particular medical condition.

So, how does one find their lighthouse client and solve the lead generation issue? Here’s how.

Step 1: List all your clients in Google Sheets or Excel.

Step 2: Create three columns next to your clients so that you can rate each of them on a scale of one to five with five being the best. The categories for rating are Ease, Fitability, and Differentiation.

The Ease column determines how easy it is for you as an agency to get work done for your clients. If you think that the work is really easy, then put down five. The higher the number, the better it is for you. Lower the number, the more difficult it is for you to service the clients.

The Fitability column helps agencies determine how much money they can generate from a client on an average deal size. While some clients might only be worth $100 a month, others could be worth $1,000 a month. Again, the larger that number is, the better it is for you.

And finally, the third column, Differentiation, states how much perceived differentiation you as an agency have with that client. A perceived competitive advantage is one where you credibly are better. This isn’t whether or not you actually are good at a service, but whether your client will believe you if you say that you’re the best at that service.

For example, I’ve spent over a billion dollars on Facebook and Google Ads in the last 15 years. And even though I’ve spent more money on Google than Facebook, I have more perceived authority when it comes to Facebook and social media since that’s what I’ve been talking about more in news outlets and on conference stages.

Step 3: Look at the results and decipher which client among all of your clients is your lighthouse client.

The maximum score you could have for the ideal client would be 15 points because you have five points, five points, and five points. Add that up, and then see what kind of pattern you have.

This method is an objective way of determining how agencies should pick their lighthouse client. Think of it as a recipe to help choose what content to start focusing on and who to direct that content towards. 

For example, let’s say you determine that your lighthouse client is a restaurant owner. As an agency, you can show new restaurant leads what you’ve done for similar clients in the past, and the leads can see that you have the authority in the field through the examples and content you’re sharing.

Common agency struggles

The process of determining your lighthouse client is not tough. What agencies and their owners struggle the most with is the fear of limiting their options after choosing a lighthouse.

I’ve done this for a few hundred agencies and it goes without saying that most folks struggle. However, the more you expand and say that you do everything, the less business you can actually generate because then you try to become an agency where you say yes to everything.

Many agencies find themselves in situations with prospects where they feel that they have to say yes to everything because they really want the deal. But, such a practice is counterintuitive. 

Can you build my website? Yes.

Can you manage my social media? Yes.

Can you mow my lawn? Yes. Wait, what? No.

You have to get one client where you’re really on top and get 10 or 100 more in the same field. Don’t get me wrong. This does not mean that you have to fire other clients just because they’re not in the same category as your lighthouse client. You can still keep them.

When you do find that point of differentiation and you get more and more of those clients, you want to start being as specific as possible.

Take the restaurant owner client as an example again. Once you determine restaurants as your lighthouse, you must go deeper and determine the type of restaurant you’ve had the most success with. It could be a coffee shop, a chain, or maybe a bed and breakfast.

The pain point of generating more leads and driving business won’t be a problem if agencies can become more specific and then tune all their content and templates accordingly.

I have my Lighthouse, what’s next?

Once agencies have determined their lighthouse, the next step is to align what they’re doing for that business, which is WHY, HOW, and WHAT, with their own personal goals. 

This is where a video marketing strategy comes into play. When you're a small agency and you're the figurehead, you know that people are buying from you and not from your company.

I often see agencies wasting their time on their company logo, name, and website. I always tell them that customers are buying from them and, therefore, need to trust them as a person.

Using videos, you as an agency owner can talk about things that are important to you and why you like working with your lighthouse client. It doesn't have to be some crazy story, but it must be impactful enough to build trust and show leads that you can take care of them like a family.

The WHY Videos

Using the WHY videos, agency owners can infuse their own personal mission into their company's brand values. It helps them capture the why of their lighthouse clients.

The goal of these videos is not to push a product or a service, but to develop awareness. By sharing personal stories through these videos agency owners can connect better with leads.

Here’s an example of a WHY video.

Click here to get a detailed template and some script examples about how to create the WHY video.

The HOW Videos

Then come the HOW videos. These sets of videos specifically need to be made with an aim for your marketing agency to share their expertise online with prospective customers.

Furthermore, these videos not only help in driving up the engagement levels, but also help in establishing you and your agency as a trustworthy source of information among leads.

Here’s an example of a HOW video.

Click here to get a detailed template and some script examples about how to create the HOW video.

The WHAT Videos

Finally we have the WHAT videos. The what is where you're making a pitch. These are the call-to-action videos where agencies get to talk about the product or service that they’re selling.

One of the biggest mistakes I’ve seen agency owners make is start their lead generation process with the WHAT videos. That won’t work if you haven’t already established trust with the WHY and the HOW videos.

Here’s an example of a WHAT video.

Click here to get a detailed template and some script examples about how to create the WHAT video.

Smart remarketing for better impact

Now that you have your videos, the best way to get the most out of them and move prospective customers down the consumer funnel, is to have a proper remarketing strategy in place.

Since the core idea behind converting leads into customers is to nurture them and move them "down and across" the consumer funnel, agencies must ensure that every consumer only views relevant videos at each stage of their current buyer journey.

Through remarketing, as soon as someone watches 75% of the first WHY video, they should be sequenced to watching the other WHY videos and be nudged towards the three HOW videos.

The next remarketing sequence comes into play when the prospect consumes 75% of a HOW video. At this time, they must be served the other HOW videos, as well as the three WHAT videos. From this point onwards, they must be totally removed from the WHY videos watching list.

Conclusion

When it comes to generating more leads, combining the process of determining your lighthouse client along with creating the WHY, HOW, and WHAT videos is a powerful strategy for agencies. 

Going back to the restaurant owner example, when other restaurant owners see you sharing personal restaurant-specific experiences, they will connect more with you since they would feel that you’re one of them and someone who understands them.

In fact, this is the major reason why I believe that lead generation is one of the easiest problems to solve. Using the magnified power of creating videos against that one target can help you create a ton of content and absolutely kill it.

If you’re worried about how to start creating these videos, don’t be. You can download a walkthrough document that contains a detailed template and some script examples about how to create the WHY, HOW, and WHAT videos.

So, what are you waiting for? Find your lighthouse client, make those videos, and get started on generating leads for your business to thrive.

About the Author

Dennis Yu is the Chief Technology Officer of BlitzMetrics, a digital marketing company which partners with schools to train young adults. He has been featured in The Wall Street Journal, New York Times, LA Times, National Public Radio, TechCrunch, Fox News, CBS Evening News and is co-author of Facebook Nation – a textbook taught in over 700 colleges and universities.

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