Jeremy Weisz 11:48
I want to talk about the decision to create your own platform is not an easy decision. It’s time and energy-consuming. Before I get to that, I would love to know how did you get into this agency world because you start off in kinesiology really? So I don’t know what you were planning on doing then? What was your idea then? How’d you land in an agency?
Alex Porter 12:08
So a long time ago, I moved out to Colorado from Maryland because I wanted to snowboard for a winter. And along the way, I ran into a college associate of mine who told me the internet was going to be big. And I should come work with him. I was on the cusp of going back for a PhD in sports psychology become a sports psychologist is what I was thinking of doing at the time. And the appeal of kind of a one-person company and getting in very early on something was exciting. And sometimes I look back and say what would have happened if I gone the other way. Because now everyone has a sports psychologist back 25 years ago, no one had it. But maybe when I retire, I’ll go back and get that and have that as my second act of my career. But I use a lot of sports psychology things all the time. It’s about peak performance and mental training and getting the most out of yourself and others.
Jeremy Weisz 13:15
A lot of leadership, how is your responsibilities changed throughout the courses of your positions raising up from Vice President, President, Chief Strategy Officer to CEO.
Alex Porter 13:30
So, along with kind of the growth of the company in size and scope, there was just a lot of needs to be met along the way and our founder Andrew Backman was still actively involved in the company as our chairman and chief ambassador. But as we progressed, it was really the transition from into the franchise space and into developing our own technology, that I’ve moved into the CEO role that was a little bit more outward facing than inward facing. We have a great team here that is really doing a great job of running the business. And I’m looking at, what are our next opportunities? Where do we go from here? What partnerships do we need to put in place much more involved in the technology development and what we’re doing from that perspective? We’re currently and have been for the last year and a half just and this is where kind of our relationship with Todd came into play is what is the capital opportunities for us as a company as an agency if we were to look for capital to accelerate our growth in technology and to gain more market share? So that’s something that’s top of mind for me right now, as well.
Jeremy Weisz 14:53
Talk about the decision to create your own platform, right. I mean, most agencies don’t. It’s a big undertaking. I’m sure that a lot went into that decision.
Alex Porter 15:03
Yeah. So a long, long time ago, before a company called Yext existed, we were doing listings management, so location data management, and we started to build our own platform for that tool. And it really started as a database. And then with along with the database, let’s kind of visualize some of that data. And so that was even before the focus on the franchise space, that’s when we’re really focused on the multi-location space. Then with the franchise space, the franchisees wanted their information in a platform or a dashboard. And instead of just building maybe an Excel dashboard, or Google Data Studio, or something along those lines, we really realized the value of hosting all of that data, and then also interfacing with the various technology platforms and their API’s from a push and pull perspective to be able to optimize those campaigns. And more so it was around aggregating the data across the various channels. So Google versus Instagram versus a programmatic buy versus in the future connected TV buy, all those pieces of information, need to be fed into kind of a marketing optimization platform, to be able to get the best ROI out of what you’re doing on that local level. And then add into the fact that your data is somewhat limited, because it is on that local level. So statistically significant results, and etc, etc. So why did we build the platform? It was because our clients were asking for it. There wasn’t a solution to the marketplace. And we also thought that our company would be more valuable if it had this technology component to it and not and go away from just a services-based business to really a technology-enabled services business to more and more technology-focused as we go through this process. I mean, we’re not going to out Google Google, we’re not going to optimize better than Google can. But we can throw in that layer on top of it, where we’re taking into account organic traffic and social referrals and these sorts of things. And how does having negative reviews impact your conversion rate on paid and things like that? There’s a lot of technology plus kind of artificial intelligence that takes some of the guesswork out and really make sure that we’re getting the biggest bang for our buck, at that local level.
Jeremy Weisz 17:40
Tell us what type of new hires do you need to start to implement that? Right? Because it’s like, yeah, it sounds great. It’s a big undertaking, right? Well, who did you need to have to put this in place?
Alex Porter 17:54
Well, we built out our own software engineering department. And so you’re going to need a database person at a UI, a middle layer, person, Director of Product project manager, and then a lot of kind of data analysts and data scientists that help us understand how this works. And as AI and machine learning have exploded over the last few years, there’s a lot of opportunities to incorporate these new findings and new opportunities into our data. So you kind of feed the machine the data and it does the rest.
Jeremy Weisz 18:34
It’s a big decision. We were talking before we hit record about different products that you offer. And I think always as a company, there’s products that a company has that they feel, should have quicker adoption and more adoption. Right. So I’d love to have you walk through one of those products that you think you know what, this should be exploding more than it is.
Alex Porter 18:57
Yeah, I mean, the software just as a whole, the Local Act software platform as a whole is an amazing tool for any franchisee that would definitively 100% drive them customers at an effective cost per acquisition. And why we don’t have 50,000 people on the platform instead of 5000 is something that I’m working through and have been working through to understand and I think a lot of it has to do with the franchisee is not a marketer. It’s not their full time job necessarily. They have a lot of things that are going on. And you know, maybe they are still doing all direct mail. Or maybe they’re still doing all something else.
Jeremy Weisz 18:57
Can they use it as like a self-serve model for them?
Alex Porter 19:06
Yes. Yeah. It’s 80% sort of and we still kind of make the sausage in the back end, but for the setup and things like that they do it all themselves. And even will go back to like, let’s say a Wild Birds Unlimited. Like, let’s say we have 95% of the locations in the platform. Still that 5% that aren’t there still is like a head scratcher to me. But more frequently, we’ll have, you know, 400 locations out of 1000 location platform. And so where are the 600 others? What are they doing? So to really go to this next level of growth is really trying to unlock the roadblocks that might exist for the adoption of the platform.
Jeremy Weisz 20:46
It’s really interesting. Other people approach you like other types of businesses want to use it.
Alex Porter 20:54
Like non franchise businesses.
Jeremy Weisz 20:56
Yeah. Like agency. I mean, I don’t know, there’s a lot of applications for that outside of franchises. But I know you’re focused really on franchises.
Alex Porter 21:05
Yeah, we are exploring other revenue opportunities beyond the franchise systems. Right? For sure.
Jeremy Weisz 21:13
Yeah. It’s really interesting. But I guess one of the things you’re thinking about is how do you eliminate any obstacles for people to be using it? How do you think about like increasing growth in general for this product? Or any?
Alex Porter 21:28
Right? Is it the obstacles for using it? Or is it a lack of understanding? Or is it like a lack of trust in it, because you don’t tangibly touch it and see it. Who knows, or I don’t know, for right now, it’s like, you put $1 in and you get, let’s call it $8 out, you would think that anyone would want to do that all day, every day. So that’s a challenge that we’re trying to solve for right now. But we’re basically, at the end of the day, we’re kind of reselling the leading digital marketing platforms that exist right now. So it’s not like we’re selling something that is unproven. So we’ve had steady growth and steady adoption of the platform. It might be a generational thing, a lot of franchises or maybe on the older end of the spectrum, and as the next generation takes over, it will be more adopted. But that’s unlocking the growth is probably priority number one for us right now.
Jeremy Weisz 22:43
Yeah. Love it. I know, for you, one of the main things you’re thinking about is growth in general. And you mentioned the outside capital, how are you thinking about growing? What are the different channels that you think about growing, and one of them obviously, being outside capital?
Alex Porter 23:02
Yes, I would say right now is the possibility of potentially doing some acquisitions of companies that are maybe similar to us, but don’t have the technology platform, some other technology platforms that would bolt into our platform very seamlessly. And those are probably the two main channels other than investing more in sales and marketing and getting more brands and getting more touchpoints, with senior leaders at the bigger maybe the top 300 franchise systems. I only say that because that’s, if you engage with a 500 location franchise system, it’s much easier to get 200 of those locations than if you engage with 100 location system and you get 10. Right? So there’s just those economies of scale that are more available.
Jeremy Weisz 23:55
Who’s an ideal client for you? Is there a certain location, size that makes sense?
Alex Porter 24:02
Right now, we’re focused on any franchises that has more than 50 locations. And I use that 50 number, because typically, around that time is when that franchise system kind of levels up from whether their management team or their technology investment or their ad fund kind of matures. But we do really, really well with franchise systems that have high customer lifetime value, whether that’s elderly care or early childhood care or learning and things like that. Those are definitely been a sweet spot for us over the past few years.
Jeremy Weisz 24:45
As of late, I mean, recruitment is always top of mind for companies hiring, especially with what you do. I mean, they’re probably constantly hiring. I know, I love to hear how do you handle digital recruitment?
Alex Porter 24:59
Yeah, so this is definitely a pandemic-born idea where everyone was having problems hiring. And our clients, we were hearing it over and over on our discussions with the client, what keeps you up at night? Well, I would love to get more customers, but I don’t have anybody to service the customers. And we thought to ourselves, we were already have these hyper-local campaigns set up for B2C. Let’s go ahead and do this for recruiting. So we built out some great campaigns across search and social and retargeting. And essentially, the idea was, let’s reach these people directly, instead of maybe relying on an indeed, or something like that, which was pretty expensive, and you would get a resume, but that same resume would go to fifth year of your competitors. Let’s go and try this one-to-one connection. And if you’re a senior care facility and unique qualified nurses, like let’s go out and try to find them directly, and that said that the cost per recruit was significantly lower. And the volume wasn’t tremendous. But it didn’t have to be right if we could fill a couple of open positions a month or a quarter at a fraction of the cost and get that relationship directly, it was really successful. So it was a creative solution to a client’s problem that we had already kind of 60% done, we just needed to switch the targeting of our marketing, it would be really valuable for our clients.
Jeremy Weisz 26:34
Alex, I just want to be the first one to thank you. Thanks for sharing the journey. Thanks for sharing. It’s really remarkable what you do at Location3 with all the team members and all the locations that you serve over 50,000. So I want to encourage people to check out location3.com to learn more, more episodes of the podcast and Alex I really appreciate you. Thanks, everyone.
Alex Porter 26:57
Thank you.
