300: Building Trust with Customers, with Jim Tracy

The most important detail of the customer experience is building trust, we must start on day 1.

We are kicking off Season 3 of the Conquer Local Podcast with Jim Tracy, President and Founder of EZlocal. Jim manages a sales force that’s spread all over the United States, and they continue to grow. He explains what the first thing he teaches his sales force, trust. We have to listen to our customers, if we’re not listening to our customers, if we’re not paying attention to them, if we’re not communicating with them, they will leave. A simple question during the initial welcome call can solve it. Jim sheds light on his unique compensation model for his sales teams and how that leads into their customer service and success.

Jim is a graduate of Loyola University Chicago, Jim served as senior vice president of National Translink Corporation and, over a span of 10 years, worked with thousands of entrepreneurs and small business owners looking to grow their businesses and reach more customers. Over the years Jim had witnessed countless small businesses going out of business as a result of heightened competition from big corporations and online retailers. This led to the inspiration in creating America’s Best Companies. Jim strives to bring the issues of the small business owner to the forefront, while leading a dedicated and professional staff working to make a difference for the small business community.

 

Introduction

George: Well, it is another edition of the Conquer Local podcast. We are kicking off season three. What a fantastic year last year was. We have some excellent episodes, and we appreciate everybody’s support. We truly are reaching people all over the planet. It’s quite humbling sometimes, when producer Coleen and I sit down and look at the stats, and see where listeners are coming from. You go to a convention, you walk into the room, and you’re standing there were four people, and they’re like, “Hey, I love that podcast that you did with Patrick Campbell.” Or, “I love that podcast you did with Sandy Delore.” There was a need there for something that was speaking to salespeople around the craft of being a salesperson. We are going to take it up a notch this year. We have some amazing guests that we have lined up. That’s the fabulous young lady sitting next to me, that has done some great work in recruiting some amazing people, that we will be talking to, around the whole business of conquering local.

George: To kick off season three, we got an old friend of mine, Jim Tracy. Jim Tracy has been in the sales business for quite some time. Over the last four and a half years, we’ve become good friends and business partners. We’ve been growing a chunk of business with Mr. Tracy and his salespeople, which are in every state in the union. EZlocal as the name of the company. It started out as an online directory, transitioned into selling a full stack of digital products. EZlocal is one of those directories, if you’re doing syndication with Yext or with Uber All, they’re right in the list. You press a button, and it syndicates at the headquarters there, at EZlocal. Before EZlocal, Mr. Jim Tracy was in the payment processing business. We’re going to dig into that with him and find out what parallels are there between the early days of selling payment processing. How it used to be, where you had the credit card, and you had that thing, ch ch. It went across the credit card, and it made the imprint and everything else.

George: Then, this machine came out, where you just put the credit card in, and it’d just process the payment immediately. You didn’t have to take the statements into the bank, and the money just arrived in your account the next day. Jim was at the cutting edge of that business, three or four iterations of his career ago. We’ve talked at length how the early days of that business mirror where we are in digital today. We’re going to definitely ask about that. Also, Mr. Tracy is one of the most rigorous people I’ve ever met. He runs an amazing business. He expects a lot from his people, but he also has people for him for, like, eight, 10 years, and speak very highly of that regiment of, “We’re here to work. We’re going to do a great job. We’re going to enjoy what we do,” but he has very high expectations. I want to ask him how he accomplishes that. Then, how do you manage a sales force that’s spread all over the 50 States of the United States, and continue to grow their business? They’re growing this business of EZlocal at a very good clip, year after year.

George: Jim Tracy, my good friend, from EZlocal in Chicago is coming up next. Our first guest on season three of the Conquer Local podcast. Well, super pumped about this edition of the Conquer Local podcast. One of the things that I really like, is getting people that fight the good fight every day. Are talking to salespeople, working with clients, making sure that what’s sold is being fulfilled. I think that those folks are really in touch, what’s happening on the street, and what are the pain points that either salespeople are experiencing, or customers are experiencing, or even the greater organizations that we work in on a whole. When producer Coleen said, “We should get Jim Tracy from EZlocal on the podcast.” You and I have had a couple of dinners since that time, because I had the privilege of coming out to your headquarters in Chicago here, a couple of weeks back. We’ve been talking over the last few years. This whole local business of dealing with local customers, it really is a bit of a challenge. What do you think, in your experience, is one of the biggest challenges that you see your people having, as they speak to those local customers?

Jim: Well, I think the biggest thing that they’re trying to deal with, is showing a customer a quick enough result. These small business owners struggle every single day. If they’re going to put their good, hard-earned money into something, they’re looking for some kind of result. A lot of what we do, some of it occurs right away, but a lot of it takes time. I think that’s one of the biggest challenges we have.

George: I’ve given a bit of a preamble in the intro about your experience, but I want to go back, before EZlocal. We’ll get to when EZlocal was created. Before that you are in the payment processing business, again, dealing with local business people. What was that experience like in that space?

Jim: That was an incredible experience. I started in that business 27 years ago, when nobody was in that business, or almost nobody was in that business. There were pain points similar than there are today. The pain points were going out to see a business owner, where they were doing the old-fashioned method of accepting credit cards. Or, maybe they didn’t take them at all. They were exclusively a cash business, checks. They didn’t want Uncle Sam knowing about what they were doing. We were trying to explain to them that this was going to become the norm. This was going to be something that they were going to need in their business. I see this industry a lot the same way, because one of those pain points you talk about is going out there and explaining to these business owners, especially those that have been around awhile, and they’re doing okay, that they need to invest in their business online. A lot of them give us the same objections that they did 27 years ago. “I don’t think I need that. My customers know me.” We tell them, “No, they don’t know you.” The next generations of customers to come isn’t going to know you until they look you up online. There are a lot of parallels, and that’s why I selected this business.

 

EZlocal Beginnings and Transformations

George: I identify you as a pioneer because in those early days, you were pioneering the space around payment processing. Imagine, where you’re walking in trying to convince a business owner that they need to accept a credit card. That, today, would be insane to open a business if you could not accept a credit card. You’re absolutely right. Even though we’ve been challenged in the digital space for 10-some odd years now, it still really is in its infancy with a lot of business people, where they don’t know what they don’t know. They don’t know that if they don’t syndicate their listing data across a wide array of sources, and have it correct that, they’ll get more business from that action. Now, we move to the digital space. EZlocal, what’s the age of the company?

Jim: Well, we started EZlocal 13 years ago, but it didn’t always start as a digital marketing agency. It started more as a directory.

George: Directory, as in … You weren’t producing a phone book. You started a digital directory, which is a really interesting business model.

Jim: That’s correct. ezlocal.com is a directory, like a Yelp or a Yellow Pages place for customers, consumers to get information about businesses in their area. We had a marketplace where business owners were coming to us and saying, “Hey, how can we expand upon this?” It just became a natural entry point for us to start doing more for them.

George: The interesting thing, if we go 13 years back, I know that your listing source is in the Yext stack. You were talking to Howard, CEO of Yext, a long time ago about this.

Jim: That’s right. We were, I think, his first client. He used us in all his early demos, because we were way, way, way ahead of the curve in the ability to allow him to put live listings in, and have them immediately be updated in our directory, and they still love us today.

George: Then, from the directory business, and I’m sure you were selling ads on that directory, priority listings, and things like that, you started to expand your digital marketing stack. I think that’s where we met. That was four or five years ago, at that point in time. What was the go to market strategy at that point, when you were working with your salespeople and sending them out to see customers? What did that stack look when you started to expand what you were offering?

Jim: In the days before Vendasta, we were just doing a lot of local distributions. We were Google partners doing AdWords, and building some websites, but we really wanted a complete package. This isn’t meant to be a commercial for all the great things you do, but it was a natural transition for us when we found you, to get a full stack of benefits for the customers.

 

Trust and Business Relationships – The Whole World Is a Sale

George: You and I are both straight shooters, so I know we can talk about this. I remember when we were on our first couple of calls, I want to explain this story for everybody to understand that the whole world is a sale. We had to build that level of trust. Then as time went on, there were some things that we brought to you, and you were like, “Yeah, let’s try it.” Others, you were like, “No, that didn’t fit.” Really, that evolution of that partnership and that trust has brought us to this point. It’s interesting to me that that’s one thing that I find that young salespeople need to be taught. You can’t walk in and hit the grand slam, home run customer right out of the gate. You have to earn that trust before you move forward. Do you still see that’s something that you’re having to teach your reps when you’re sending them out?

Jim: Yeah. The first thing I teach my sales reps, if they want to make a sale, business owners have to like them and trust them. Then, like you said, when we first met, I had to like you, and I had a trust you, because I was basically putting some piece of my business in your company’s hands. In the credit card processing business, going back there, we had Visa, MasterCard, and the banks that were really in charge of what we were doing. We were a full payment processor. All of a sudden, regulations started getting tighter, things started happening. I had that fear, going into the relationship with you. I’m like a business owner out there, when a salesman walks in, and they’re saying, “Hey, we can help you. We can do this.” Well, you’ve got to build that trust, and you got to like the person you’re working with. If you don’t like them, you’re not going to trust them. I teach my salespeople that every day.

George: It’s interesting, in our relationship, how it grew, in our partnership, how it grew, it also became a bit of a sounding board. I was with a customer that I’ve known for a number of years for lunch yesterday. I like going out and talking to business owners. This gentleman’s family owns about 20 car dealerships. We really got down and dirty. I said, “Tell me what you hate about your media reps.” He’s like, “They don’t listen. Every time they walk in, all they’re about is trying to sell what’s in their pocket that day. They’re not listening to what I really am looking for. Then, when something inevitably happens wrong, they don’t take ownership for it.” I’m like, “Oh, my God.” It’s sales 101 in 2019, those are the things that you just can’t do anymore because you need to keep those customers. I’m leading into your industry-leading churn numbers. The fact that you have such low churn, there’s got to be something in it, the way that you’re offering your solutions. Let’s dig into this. Your churn is super low. When you get a customer, they stay around for a long period of time. How have you been able to… That’s the holy grail. How have you been able to accomplish that?

Jim: Well, you’ve got to listen to the customers. It’s what you just said. I think you naturally led me into this answer. If you’re not listening to your customers, if you’re not paying attention to them, if you’re not communicating with them, if you’re not showing them love … We find all kinds of crazy ways to communicate with our customers. A lot of people just do it through phone, or through email. One of the things we found, is we want to talk to those customers right up front, in what we call our initial welcome call, and we want to ask them, “How often do you want to hear from us?” Then, we follow through with that. That’s one of the biggest things. A lot of people sign up people, have that initial impact, and then forget about them.

Jim: We continue to contact that customer, at the pace they want to be contacted at. Plus, we do unusual things. We send them cookies, we send them brownies. We do little things, just to make sure that they know we’re out here thinking of them, working with them. We’ll have our people write a handwritten note. “It was a pleasure speaking to you today. Here’s a brownie. Have this on me.” Or, sometimes it’s just, Hey, I want to let you know I was working on your account today.” They write a little handwritten note that they get in the mail, with a cookie or something. The customers really seem to appreciate that. That’s just one little piece in the whole battle against attrition.

George: It’s really interesting to me, that handwritten note thing. My sales manager, 1989, made me do those, and I’m still doing them to this day. I’ll walk into a customer’s office and there will be my little handwritten note, with the Thank You on the front of it. It’s just those little touches that. Again, it has to be genuine. You have to truly appreciate the client. Now, where I wanted to go with this, in telling us that story, is I think it’s a really unique model. When your salesperson goes out and makes the sale, you just want him to go make another sale. The ownership of that client lives within your four walls, at the EZlocal headquarters in Chicago. Is that something that you learned over the years? Have you always done it that way? I don’t see a lot of landlords in your organization. It’s like the rep gets the deal, moves onto the next one. You folks internally take care of everything else.

 

Build the Right Model for Reps and Clients to Thrive

Jim: Yeah, that’s right. That’s the way we’ve always done it. That’s the way we did it all the way back in the credit card processing business. It allows us a) to really have a large sales force out there. We have salespeople in all 50 States. We have customers in all 50 States here, in the US. It enables us to keep control. If we allow those salespeople to be communicating with those business owners every day, then the salespeople are calling in every day with this issue, that issue. Then everything gets watered down. We want to have that relationship with the customer, and we want that salesperson to have the relationship with the word “next.” Now we used to have a blinking sign in our office, it was a neon sign, it blinked “next”, and it was huge. We finally removed it because it was giving people headaches. That’s the way we want our salespeople thinking. Think about the next customer. We’ll take care of the customer from there. They have every confidence we will, because we’re paying that rep 20% of that ongoing revenue. It’s an unusual model out there, but those reps have confidence. They’re saying, “Yeah. EZlocal has to take care of these customers. They have to keep the money coming in. They’re giving me 20% of it.” It’s a big part of what we do.

George: Let’s lead into this. Not that this is a paid announcement for EZlocal, but we have 10,000 unique listeners that are all salespeople out there. I had talked to people all day, they’re like, “I’m running an agency. I really don’t want to do the customer service stuff. I really just like going out and selling.” You’re telling me that you would hire a salesperson, pay him 20 points of the ongoing commission, and all they got to do is bring you a deal, and you take care of everything else?

Jim: That’s it, and they get all the money upfront as well. Whatever they charge and set up fees or upfront fees, that’s right. We give them all that, and 20% of the billing every month. The residual is there on the deal. It’s a real interesting model. Now, let’s break it apart. I’m an individual agency owner. I’m out selling to customers, and doing all the fulfillment myself. All the things that Jim’s team internally in Chicago do for their reps in all 50 States. There’s going to get to be a point where … You’ll start breaking stuff first. You won’t be able to deliver the level of customer service, you won’t be able to add more revenue. I think it’s really important that we break this apart, and set some realistic expectations for these agency owners that are one, two, three, or five people. There is a growth ceiling, if you’re going to do the fulfillment yourself. You’re going to have to figure out how to scale that fulfillment side of things.

Jim: Then, the next piece is you’ve really figured out that you have that acquisition model. You put walls around it to make sure that they’re laser-focused on acquiring, and they don’t get bogged down in the other stuff. Some really good lessons in that. I had a really good dinner the other night with you. That was a great place that we went to. Thank you so much for that. I like asking this question. You seem to be one of the most driven people that I’ve ever met, but you are at work all the time. You are on the floor actively running your business. How much does that lend to the success that you’ve had?

Jim: That’s a good question. George. I don’t like to take really a lot of the credit for my success. I am here every day at 7:00 AM. I welcome every person as they come through the door. I make sure there’s hot coffee going. I usually bring in donuts. All I am here, honestly, is a servant to the people that work for me. I’m here to give them the things they need, the tools they need to do their job the best. That’s really the way I look at it.

George: We were fortunate to have a number of our top agency partners arrive at Conquer Local, in beautiful San Diego. Pretty hard not to come there, because it’s one of the most beautiful places on earth. I saw you hanging out with some of the other top producers. If I look at the pedigree of all of those owners of those businesses, it’s very similar. It’s extreme ownership. It’s treat your people really well. You have two VPs that have been with you for, like, 15 years, or 12 years, or something like that.

Jim: Yeah. Dave has been here 17 years. Derek has been with me for 13 years. Dave obviously predates even this business, but our average employee here has been here about seven and a half years. We do build some loyalty in the employees here.

George: The one thing though, we got the flashing neon sign around “next.” I do know that you have very high expectations of your people, and you don’t apologize for that.

Jim: No. Yeah. We’re looking for success, and I get it. I want to go back to something you said, just for a quick second. You talked about that rep out there, that once they reach a certain level of customers, they hit what we call the Peter principle. They get to a point where it’s hard to add more before they start losing the service, and they start getting to a point … We were there a couple of years ago ourselves, and we had to think outside the box to really build our business to set new records.

George: Well, I’m glad you brought that up, because that’s the pivot. The pivot is such an important part, in today’s business world, to staying successful. We internally, at our organization, have decided to start interviewing around, “Can you handle change? Are you change adverse?” If the answer is, “I don’t really like change, I like to …” If you had to move desks three times in the next three months, how would that feel? They’re like, “Um …”, you just see their eyes pop open. They’re like, “I couldn’t handle that,” then it’s just not going to work for you if you’re in a fast-paced space, which digital marketing is one of the fastest-changing industries on the planet. Now, there are a number of others that are like that. FinTech, healthcare, there are a number of them that are like that. Digital marketing, there is a new startup in digital marketing born virtually every second. If you are not on that curve of, “I need to be pivoting all the time,” you’re not going to be successful. How many pivots, in the 13 years that you folks have been in business, have you experienced?

Jim: Countless. Just from the products, to the services, to the way we work with the customers, to the billing programs. There’s pivots every day, as you know.

 

Conclusion

George: I’m starting a season three here, and Colleen was giving me hell the other day. She’s like, “You’re all talk business. You don’t talk about anything personal with these folks.” You and I have known each other for a while. What do you do to unwind, Jim? What does Jim Tracy do when he is not at EZlocal? What are you doing to separate, and have a little work/life balance?

Jim: Well, number one, I’m an unusual cat. I’m 54 years old today, George, just so you know.

George: Happy birthday.

Jim: Thank you. You’re the only one I would do this for on my birthday, to be honest with you. One of my big hobbies is pinball. I’m an older guy. In the late 70s, I was a teenager. I loved the game, played at the local arcades, the local bowling alleys. As you get a little older and you have success, you try to relive that glory from your youth. I’ve got a nice collection of pinball machines. I love to play them. We have a local league of 32 guys here in Chicago that all play. Each of us has 20, 30 games or more, and we go to each other’s house once a month. We keep scores, we play for a little money, have some fun. That’s my big hobby.

George: You also are refurbishing pinball machines. We’re not talking to machines, folks. He’s got, like, 30 of them, in a room full of pinball machines. That’s unbelievable. When you talk about having a vision board as a salesperson, I think all successful salespeople have the vision board with the, “I’m going to earn the commission, I’m going to get that thing, and that thing, and that thing, and that thing.” If you walk into the sales rooms that we have in my organization, I’ve done this for years, they all have vision boards. This is the thing that drives you forward, isn’t it, sir?

Jim: Yeah. I teach the same things to all my salespeople. I want to know what motivates them, what drives them. The day they start with me, I want to know why are you here? What are you doing this for? Some guys, they’ll give you an honest answer and say, “My wife wants me to go back to work.” Or, they’ll give you some kind of cheap answer. When the guy says, “I got to put two kids through college. I want to pay my house off, I want to do this,” you know you got yourself a winner.

George: Well, I really appreciate taking some time off on the birthday to join us in the studio here, for the Conquer Local podcast. We appreciate your support. If you are a salesperson out there, and you’re looking for a home, EZlocal sounds pretty damn good to me. Jim is currently accepting new salespeople. You’re on LinkedIn aren’t you, Mr. Tracy?

Jim: I am. An easy way to learn about us is to go to ezlocalpro.com.

George: Fantastic. Well, enjoy your day, and thanks for calling us from the Chicago land area. We’ll see you soon.

Jim: All right. Thank you, George. Take care.

George: Wow. There are so many nuggets in there from Mr. Jim Tracy. This guy eats, lives, and breathes that business on a daily basis. Obviously doing quite well, because he’s got that collection of pinball machines there. There is something there. I’ve been looking inside a little bit, talking about my work/life balance. One of our young people at the company of the day said, “Hey, what do you do for hobbies?” I’m like, “Well I get up early and come to work.” Having that work/life balance is pretty important. The small touches go a long the way. I’ve been doing a bunch of reading about this. There are all sorts of sales leaders and trainers out there that are talking, reminding people. We live in the days of the challenger sale, and we live in the days of the solution sale, and we live in the days, but I really believe that people do business with people that they like, and they do business with people that treat them well. They do business with people that make them feel like they’re top-of-mind. That’s what Jim was talking about, with those little touches.

George: I think it’s a really important piece. It’s not just sell it and forget it. You’re not going to keep the customer that way. You need to keep yourself top-of-mind with that client. That compensation model is aggressive: 20 points, just go out and keep bringing me new business. Then, behind the scene, Jim’s team keeps the business. I will tell you they’ve got an amazing group of people in their customer success department, that is making sure that everything that the salesperson said comes true, and then some. They under promise and over deliver every single day, and that is a big part of the success that they’ve had. Now let’s look back at keeping it simple with the client, just like in the early days of payment processing and selling that, but then, delivering the value. Making sure that that moment, from when you make the sale, to the customer seeing the value, that’s how they’ve been able to keep that amazing, ultra-low churn number, and the retention of their customers.

George: We continue to add folks to the Conquer Local community. It is on Slack, and you can get the link right on the Conquer Local website, which is at conquerlocal.com. We really appreciate the comments that have been coming at us on LinkedIn. It’s unbelievable to me. I know that people are listening to the podcast at all hours, because I’ll go to my LinkedIn, and then there’ll be like a message that came in at 1:00 AM from this person, say, “I just listened to this episode with so and so. It was fantastic.” What I really like, is the suggestions that are coming along. If you want to say that we’re doing great stuff, great. You want to give a suggestion of how we can improve? Even better. As you reach out to us, we read every single message that we get. Please, make those suggestions of possible guests that you’d like us to bring to the podcast, and possible topics that we will be covering. As always, my name is George Leith. Thanks for joining us. It is the Conquer Local podcast. I will see you when I see you.