Is it safe to trust small biz clients for your performance numbers?

Good point! Business partnerships generally involve a written agreement and sometimes multiple agreements, depending on the arrangement. The ability to audit, see the books, financial and tax statements is expected and commonplace.

We won't get into what might be required personally.

This thread hasn't even scratched the surface regarding what's involved in assuring for successful business relationships That's a study unto itself.

I've had my teeth kicked in (figuratively) a few times by some real pros, but it always comes back to my own lack of due diligence. I had some experience going in. The fault was entirely mine.

But you learn, and the scars are there as a reminder.

I have learned that there is no easy. And my experience bears out what Jay Abraham has said about partnerships and joint ventures. ""Don't start the deal until a "contract of agreement" is fully discussed and signed. Don't start to reveal too much. Don't make your assets available. Don't make your operation open to the other party until you have an irrevocable, binding, and fully stated agreement. Take my word for it, you will regret it if you don't."

The world of business is a serious place. The players are playing for real money.

Learn to protect yourself. Hire the best legal assistance you can find, if you need help or don't understand something. It will be the cheapest and probably the best investment you could make.

Ron

Personally, we simply ask buyers what brought them in the door. I assume that they are telling the truth about 80% of the time. So it's accurate enough to allocate marketing funds.

Most people simply brought in the ad that they had seen.

When I was doing local online marketing for retailers (mostly), I made their online ads and videos so that there was something to mention to get a free gift, or discount. like "Mention you saw this video and get a free set of sheets with any mattress". Not perfect, but it let the retailer know that the work I did was paying off.

It's always fascinated me that even rather large businesses, doing a few million dollars a year, have no idea what ads are working, or if they are just wasting money.

They not only don't know how to track ad performance, but the entire idea is foreign to them. In fact, the idea that advertising should pay for itself and generate a profit is almost as foreign an idea to most business owners. Of course, ad reps aren't going to suggest them tracking ad effectiveness, because ad reps have no idea how to advertise in a way that generates a profit.

I've given talks to advertising company reps, and the idea that ads were bought to generate an immediate profit for the advertiser....was very hard to sell to them.

So it was a great relationship. As reps didn't know how to advertise, and ad buyers had no idea that ads could generate an immediate profit for the company.

We do packages which are named. In order to buy, they have to ask for the package. And this name is programmed into the POS system, so reporting is automatic.

If client is still in the abacus and quill pen and parchment era, then you'll need to work with what they have. Use coupons which are thrown into a box and counted up at the end of the week.

A little trick is to always price them uniquely, then a sort on the accounts for the price will tend to show up anything that's not your named package.

Having said that, I can't think of a time when I've ever been suspicious of a client...

Contingency fees have made me rich. I don't have to wear out my shoe leather or dial for dollars on Xmas eve to feed my family... My longest running deals are coming up to four years now. I've always been paid.

Clearly contingency deals are not for everyone... I suggest that you mix and match. Do some fixed fee and some contingency and find out which works for you...

[quote=Ron Lafuddy;11159416] Ron:
We are only talking about a few deals that I can recall.

But these performance deals are different from joint venture deals. In a joint venture, the orders can easily be counted from both parties. And one party is providing the product that the other party doesn't have. Much...much more likely to be successful.

But doing online marketing work to promote a business is different. All the work is done up front. So you are seemingly doing nothing after the first month, but the client is paying progressively larger fees. Psychologically, it becomes ever more difficult to justify paying fees.

This is based on my limited experience working with sole business owners. My suspicion is that it's different with larger companies where the checks are written by bookkeepers and not the business owner.

Another factor that may be the single most important part, these deals were made because I couldn't sell a single fee...and decided to accept a contingency basis.

I didn't go in with the idea of accepting a certain percentage. I did go in with the prospect thinking it was a contingency fee basis though. I just couldn't convert them to a single fee. And there was no way to really track the sales directly attributed to my work.

So don't use my example as gospel. It's just my experience. Another factor is that these deals were sold cold. There was no prior business arrangement...no history between us.

By the way, there has to be a way to track sales that come from your efforts. Animal44's idea of unique pricing would solve the problem, as would bringing in a coupon. With these triggers it would be hard to cheat, except for outright fraud. And most people won't defraud you outright.

The problem comes in where you charge a percentage of an increase in sales across the board. It's very murky as to what caused the increase...it could be seasonal changes, a competitor folding up, increased demand, any number of things.

Well hell, why didn't you say so earlier.

This is a genius idea.