How I Built A $144K/Year Digital Marketing Agency For The Painting Industry
Hello! Who are you and what business did you start?
Hi! My name is Austin Houser, and I'm the founder of Base Coat Marketing, a full-service digital marketing agency exclusive to the professional painting industry.
Why painting businesses? Simply, the market research suggested they were an industry in need of a voice, or a face, someone to help break down marketing for the industry as a whole.
The gamble appears to have paid off. Just three months after launching, we're already on track to exceed last year's revenue under my previous agency, which at the time was 13 years old. Today we are generating $30,000 in monthly recurring revenue with roughly a 50% profit margin.
What's your backstory and how did you come up with the idea?
After graduating from college with four degrees (Computer Science, Computer Security, Math, and Business), I spent a decade moving up through corporate America. I took my first job as a Web Developer in a large organization, but I quickly realized the individual contributor role wasn't a good fit. So I transitioned into marketing, and I fell in love. Breaking down the psychology of the human mind to find new methods of consciously or subconsciously capturing an audience's attention; Yeah, it's exciting stuff!
In 2008 I founded Houser Media, which was, and still is, a successful business by all accounts. From small restaurants to international brands, our clientele ranged across all business spectrums. The problem? It wasn't a scalable business model.
A turning point came after we acquired a few painting businesses as clients over the years and noticed a common trend; we were good at generating results. At the time, unknown to me, the industry was ravaged by "marketers" selling snake oil. Many painting business owners in the mid-2010s were receiving mediocre results at best, but many were outright scammed. So in 2021, I founded Base Coat Marketing, a niche-focused agency with a drive to become THE authoritative voice of marketing within the professional painting industry.
I’m not afraid to take calculated risks, and more importantly, I’m not afraid to fail. As they say, failure is the best way to learn what doesn’t work.
Using the capital and established team from Houser Media I was able to scale Base Coat Marketing quickly. After investing roughly $5000/month I was able to reach profitability in just three short months.
Take us through the process of designing your services.
Unlike a typical agency, we group our services into three digital marketing packages. We do this for a few reasons:
- It allows us to standardize our processes and scale quickly.
- We can provide more value. Since we know which services pair best together, we can guarantee leads within the first 30 days.
- It's easier to sell.
All of our services are built around SOPs for the first 30 days. This is to ensure we deliver a consistent, positive experience for our clients. These SOPs include triggers and due dates for each deliverable and action item.
Many of our services occur simultaneously. For instance, we’ll begin writing content, building the website, and launching ad campaigns all within the first 14 days. After this “ramp-up” period we then meet with our clients and adjust our services to complement their internal processes.
We like to think of ourselves as marketing partners, not just a service providers.
Our clients care about one thing, and that's getting more painting jobs. They don't care how you do it. They just want their phone ringing. When you offer over 20 independent digital marketing services to a professional painter, you're going to scare them away. Think about it. They have likely been ripped off by another "marketer" in the past. They have PTSD. So we decided to keep it simple, and as it turns out, simple sells!
While this may all seem like common sense, it was built by trial and error. Most of the failures in my career came from my previous agency, so I had a pretty good idea of what didn’t work. For instance, client communication within the first 30 days is critical for long-term retention, and I learned this the hard way. High turnover rates make you feel like you’re stuck on a hamster wheel, but I grew from these failures.
With years of experience under my belt, I was able to build a strong foundation for Base Coat Marketing that worked well from day one. I don’t consider myself the smartest guy in the room, but I work hard, I’m not afraid to take calculated risks, and more importantly, I’m not afraid to fail. As they say, failure is the best way to learn what doesn’t work.
Describe the process of launching the business.
I need to give a shoutout to Josh Nelson. I highly recommend that any agency owner read his book, The Seven Figure Agency Roadmap. It was an absolute game-changer for me.
In his book, Josh breaks down the concept of recurring revenue, niching-down, and positioning yourself as an industry expert.
You can learn a lot from those who have walked in your shoes. If you're looking to grow quickly, and learn from the mistakes of others, hire a coach.
Yes, some digital agencies can succeed under the "generalist" model of serving clients in any industry. The problem is you're competing with every other agency in the world. For example, to rank on Google for the term "SEO Agency" requires a considerable amount of content marketing, link building, and a massive advertising budget. On the other hand, ranking for "SEO agency for painters" is a walk in the park by comparison.
Using this model, I took a gamble. I left my 9-5 and jumped in with both feet. I had stockpiled some cash from running Houser Mediaover the years, which gave me eight months to create a sustainable business, and I did it in 3.
I started with a solid website that showcased our capabilities. If your customers aren’t impressed with your website why would they expect you would do any better for them? Publishing consistent, quality content and clearly defining our service offerings was a secondary strategy to establish credibility as a new business. This helped with closing our first three clients, which all came from paid search (Google Ads).
Since I had a background in running paid search campaigns I was able to dial in our target demographics and create custom audiences from contacts we compiled. These contacts were obtained from industry associations and by manually searching Google for qualified candidates (yes this took weeks of manually building out spreadsheets).
I finally decided to try purchasing targeted contact lists and was pleasantly surprised with the results. So far the conversion rates between these three contact sources have been relatively similar across the board.
Since launch, what has worked to attract and retain customers?
Currently, we acquire roughly 70% of our business from paid search (Google Ads). The remaining 30% is a mix of social media, email marketing, and cold outreach. From the start, I knew I had a finite budget to reach sustainability, so at the time, paid search was just a short-term solution to jump-start the business.
Ranking well organically has always been the long-term strategy. I dedicate at least one full day a week to link building and content development. It's a time-consuming process, but the payoff of ranking organically for your target terms, you really can't put a price on that.
Once we acquire a new client, we hit the ground running. On the first call as a prospect, we set expectations. On the first day as a client, we work to exceed those expectations. For instance, we have 30 days to build a custom website and start producing leads, but we try to do this within the first 7-14 days. This initial onboarding experience sets the tone for the rest of the relationship and drastically increases client retention.
How are you doing today and what does the future look like?
As it stands today, Base Coat Marketing is scaling beyond all initial goals and projections. Depending on the digital marketing package, we run at a loss for the first 1-3 months. After we break even, our margins are between 55-and 80%. These high margins allow us to scale quickly, but they are not sustainable long term. I fully anticipate our margins to converge around 50% as we scale and hire.
We test everything we do. For example, if we update a button color or change the position of an element on the page, we first run a split test to confirm our theories.
Reference my previous statement about the "psychology of marketing." It's all a numbers game. If you have 1000 monthly visitors to your website, a certain percentage of those will convert into a lead. The more data you have, the more actionable insights you can derive. As a result, we test and measure which changes produce the best results to improve our primary KPIs, including CTR, CVR, and CAC.
For reference, right now, our CTR is hovering around 5% with a 7% CVR and $85 CAC. These numbers are high not by chance, but by design. We cast a wide net but with an extremely targeted audience.
We try not to waste ad spend since just one click in the lead generation space can cost over $30, and there's no guarantee that click will convert into a lead. With that said, if these KPIs hold steady, we are on track to scale to 7-figures within 18 months.
Through starting the business, have you learned anything particularly helpful or advantageous?
One of the most valuable takeaways I've learned as a business owner is an importance of providing value and being genuine. We have all been raised around automated phone prompts, chatbots, and scripted cold calls. We're taught that you have to be pushy to be in sales, and marketing is all about FOMO and clickbaity headlines. None of this is true; it doesn't work like that, at least not anymore.
Consumers are more intelligent than most marketers give them credit for. For instance, most consumers are likely to research and educate themselves before making a purchase. With the internet at their fingertips, there are few reasons someone will buy on the first interaction. This is especially true for longer sales cycles.
So how do you make a positive impression? Provide value, and be genuine. Every call doesn't have to be a sales call. It's ok to call a prospect to see how their day is going. It's ok to call with valuable data you've compiled working with other clients and not expect anything in return. Sure they might not buy from you, but you're creating a brand advocate. You're grooming someone who will recommend your business to others based on their positive, personalized interactions.
What platform/tools do you use for your business?
Initially, I spent a lot of time refining our tech stack as I knew we needed a scalable environment. We are leveraging a CRM called High Level, and to be honest, it's way more than just a CRM. This one platform powers our entire marketing suite. From call tracking and online appointment booking to website chat and email marketing, it's been a real game-changer for us.
The other tool I cannot recommend enough is Warmbox. We send thousands of emails every month, so we needed a solid plan to hit our prospect's inboxes and not their SPAM folder. After evaluating several email warmup services, I landed on Warmbox for its flexibility and reliability. It has significantly improved our email deliverability rates. Since email marketing has the highest return over all other forms of digital outreach, it paid for itself in the first month.
As a lead generation service, we have had success with Coldlytics. They produce highly targeted lists and even verify the email addresses they provide you.
On the SEO side, we use Ahrefs and Local Viking. If you are in the Local SEO space, I believe these two tools are almost a requirement to do business.
What have been the most influential books, podcasts, or other resources?
I try to find time to listen to at least one audiobook a month. So far this year, I'm averaging two books a month. I want to give Josh Nelson and The Seven Figure Agency Roadmap another shoutout. While some of the content is a little dated, the concepts hold, and anyone running a generalist agency can benefit from reading this book. Josh also has a fantastic podcast and Facebook Group.
A few others that I highly recommend are $100M Offers by Alex Hormozi, The E-Myth Revisited by Michael E. Gerber, Sell or Be Sold by Grant Cardone, and Sales EQ by Jeb Blount.
I also have found a lot of value in the Ahrefs and Backlinko YouTube channels. They're both extremely valuable resources for understanding search engine optimization in 2022.
Advice for other entrepreneurs who want to get started or are just starting out?
Two things: You're never going to be ready, and you don't know what you don't know.
To start, if you're comfortable working a 9-5, you're never going to be 100% ready to pull the plug and start your own business. Why? Because it's hard. You need to consider health insurance and how to support yourself while also investing in your business. You need to be prepared to work 12-hour days, seven days a week. It's not easy, and most don't make it, but the payoff is huge for those that do. So stop waiting for the right time and jump in.
Second, you don't know what you don't know. I've learned this the hard way several times. As a young entrepreneur running a successful business, I felt like I was on top of the world. Almost invisible. But in reality, I had no idea how much I didn't know. It's a humbling experience to fail. This is why I recommend business coaching. You can learn a lot from those who have walked in your shoes. If you're looking to grow quickly, and learn from the mistakes of others, hire a coach.
Are you looking to hire for certain positions right now?
At the moment we are still a young company in growth mode. Our next hire will be account managers, followed by an in-house copywriter. We will begin hiring for these positions later this year.
Where can we go to learn more?
We are in the process of launching a new podcast that will pair with our Facebook Group, Base Coat Brainiacs. For now, you can find us online at our websiteor on any social platform.
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