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How are you going to acquire new customers at a reasonable cost?
That—more than anything else—is the question you need to be able to answer as an entrepreneur looking to launch a business that will survive and thrive.
Customer acquisition is everything. It is the lifeblood of every business, be it nascent or fully-developed. Without consistent and reliable new customer acquisition, a business is living with one foot in the grave.
Contrary to what most entrepreneurs think, customer acquisition doesn’t need to be a profitable enterprise right off the bat. In fact, the most successful customer acquisition campaigns are quite often breakeven, or even negative at the front-end.
Think of it like this—if it costs $1000 to acquire 100 potential customers (leads) for a company, and only 10 (10%) of those leads convert into customers (purchasing a $25 per month subscription-based product), the acquisition cost at the end of month one puts the business $750 in the red.
The customer acquisition cost is NEGATIVE at this stage.
But by the conclusion of month four, the company has reached the breakeven stage, and at the end of the month five the company has made a 25% profit on its initial $1000 investment. Plus, the company gets to hang on to (and continue to market to) the other 90 leads that haven’t become customers yet.
This idea that it’s OK to not run an immediately profitable customer acquisition campaign is just ONE of the many MASSIVE takeaways shared on this week’s episode of Making Bank, where host Josh Felber, sits down with marketing funnel master Todd Brown, of Marketing Funnel Automation.
Inspired by a single piece of direct-response copy he got in the mail, Todd catapulted himself into the world of marketing 15-years ago and never looked back. Today, he’s enamored with the idea of salesmanship multiplied through readily repeatable, automated means that any entrepreneur can use to grow a healthy business.
Listen as Todd and Josh talk at length about a number of incredibly valuable marketing concepts and strategies that every entrepreneur—be they a seasoned veteran or new arrival to the game—needs to know, including…
- The danger of having ONE of ANYTHING
- Reasonable customer (lead) acquisition
- Mom N’ Pop lead acquisition versus savvy lead acquisition versus professional acquisition
- Why elite marketers are more like prosecutors than salespeople
- The under-appreciated value of numbers-knowledge
- And the THREE indispensable keys to a successful front-end funnel build
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Josh Felber: Welcome to Making Bank, I am Josh Felber, where we uncover the success strategies, the secrets of the top 1% so you can transform your life and your business today. I’m really excited today, I have an awesome guest. I think you guys are going to love him so make sure you get your notepads and your pens out. I want you to consider the authority on creating profitable marketing funnels. Todd Brown is the funnel expert other experts go to when they need help with their own funnels. His list of clients is the who’s who’s of the A-list marketers, as well his agency creates the campaigns for the biggest direct response marketing companies online. I want to welcome Todd Brown to Making Bank.
Todd Brown: Hey, hey man. Thanks for having me dure.
Josh Felber: Cool. Yeah, I’m excited, I follow a lot of your stuff that you do, the different live videos, your webinars, everything, so it’s really awesome to be able to have you on the show today and really dive in deep on some of those really cool back end strategies that you’re doing and some of even the thought process and the psychology that goes behind what you’re marketing out there.
Todd Brown: I love it and I’m honored to be here man. Like I said I’m an open book so let’s dive in and rock and roll man.
Josh Felber: Cool. I guess let’s start back, how did you get into the whole internet marketing side of things? Because I know you came from a whole different background and it wasn’t just out of the womb, in the internet and computers and all that right away.
Todd Brown: Yeah. I’ve been at this game now for somewhere between 14 and 15 years in terms of direct response. The way I got into this was kind of a fluke. I was working for a health club company in New Jersey. I’m a New Jersey boy now in South Florida, a wife, two little girls, not so little anymore but two girls. When I was working for this health club company I got a direct mail piece and it was a long form copy, post card, big oversized postcard.
At the time it was marketing and selling fitness marketing and sales course. I had never seen anything like that before, I was running a department for this health club company, several locations. I asked the owner, I said, “Hey, I’m going to expense this, are you cool?” It was about $300 or something like that. He said, “Yeah,” and in the mail arrives this monster home study course. I’m talking, this was pre-membership sites, pre digital product, so everything was binders and …
Josh Felber: CDs or DVDs. Not even?
Todd Brown: No, this was before CD.
Josh Felber: VHS?
Todd Brown: This is cassette tapes.
Josh Felber: Nice.
Todd Brown: Certainly my original stash of info products is VHS, which I still have in my garage as a piece of memorabilia. I got this thing, dove in and I was enamored. I was enamored with the whole idea of salesmanship in print, of salesmanship multiplied, of the fact that you could take what you would do face to face, one on one with prospects and you could multiply it with direct mail to sell something. I was enamored by it.
I took that training, implemented it at the company I was working for and my department skyrocketed over the next 18 months. What we were doing was tremendous. I grew my department to a multimillion dollar a year department, the shining star in the company. Then I got an itch to share what we had been doing beyond what I had learned, because we adapted it and tested stuff. Some stuff worked and some stuff didn’t work.
I didn’t want to do anything inside the fitness niche because I didn’t want there to be a conflict of interest with the company I was working for. I decided to share with massage therapists because it was somewhat of an affinity with what I was doing. We worked with massage therapists and chiropractors. Very quickly, I would say within 24 months, I had grown the biggest publisher in the massage niche of marketing, practice building, sales training material. Also sold our first home study course, had … I don’t if you remember the little hard diskets in computer?
Josh Felber: Yep.
Todd Brown: Remember those?
Josh Felber: Yeah.
Todd Brown: Yeah, I’m dating myself a little bit. Then it got to the point where my wife, she was in my ear, she’s like, “Why don’t you do this full time? Let’s move down to South Florida,” that’s where my family had relocated, my mother, my father, at the time. Then that’s where I went, I started full timing the information publishing arena. Then from there I ended up going into multiple markets, I worked with chiropractors, dentists, martial arts school owners, carpet cleaners, and then the rest is history man.
Josh Felber: That’s awesome.
Todd Brown: Yeah.
Josh Felber: It’s like you’re like, “Hey, I want to do this to advance my job career,” that you had, and dove in and really took off with what you learned. I think a lot of people out there that they’re in an employee role somewhere and they’re like, “I would like to … ” They have the entrepreneurial itch in them somewhere but they don’t know how to actually implement. I think that’s a phenomenal way, is be that shining star within your company. Go out, figure out how to make that seven figure department or take that department to that next level, and then look where it takes you now.
Todd Brown: Yeah. I would say this, let me give a piece of encouragement to the folks that are listening that sill have a full time gig. There’s a couple things. Number one, I had a full time job, I had a full time gig and it was a demanding gig. I was in a position where a bulk of my compensation was bonus driven, commission driven. It wasn’t necessarily a nine to five gig, but I start my business on the side.
Early in the morning, late at night and on weekends I worked on the business. I made sure that when I was working during my work hours, the hours that I was allocating towards the company that I was working for, that I was giving 100%. You do right by the company that you’re working for. Even if you’re not in a position where you can utilize your new marketing chops, your new marketing knowledge, your sale skills, that’s okay.
You work your job with diligence, focus, on the side you can build your business. The other thing that I tell people that surprises them is two things actually. When I started my business I only started with $850. I never invested another dime of my money. I decided it was $850, which is used back then to form a corporation and get a merchant account, crazy stuff.
Josh Felber: Which was the bulk of it probably.
Todd Brown: Yeah, which was the bulk of it, exactly. I never invested another dime of my own money to this day actually.
Josh Felber: That’s phenomenal.
Todd Brown: Everything was bootstrapped. The other thing was that for a year I did not take any money out of the business. For an entire 12 months every dime that we generated, that I generated, went back into learning and growing the business in terms of traffic. It was reinvested back in for 12 months. I wasn’t trying to go full time in a month or six weeks. I knew that I was playing the long game and I was willing to put in, and then when the time was right, which you’ll know it, then I was able to walk away from a great job to a great business.
Josh Felber: I think that’s some excellent advice because sometimes I’ve talked to people in that same position, they feel trapped, “How do I get out of that?” They feel that they’re doing a disservice to the company that they’re at because they don’t want to take away from that, but I think that’s some great advice for sure.
Todd Brown: Yeah, you don’t have to. If you work a nine to five, if you work an eight to six job, whatever it is you work that job with diligence, with 100% focus while you’re there. There are a lot of hours in a day. There’s a lot of hours in a day, you could invest 45 minutes in the morning, 45 minutes at night, you get 90 minutes everyday, and then of course you’ve got the Saturday certainly to invest a bunch of time in your business, a lot of time. Today it’s never been easier, especially online, to start a business, with all the tools and technology and resources. It’s never been easier, more efficient today than … it’s never been. Today it’s so simple.
Josh Felber: Tell me, as you’re growing this, you said you’ve got 14 plus years in it, what was one of your biggest challenges to actually overcome?
Todd Brown: There were so many.
Josh Felber: Yeah. Maybe that one where you thought, “Hey, I might not get through this,” it might be that.
Todd Brown: Oh my Gosh. There were a lot to be honest with you. Let me say this, I’ve been in situations before, I was in a situation not that long ago actually, just a handful of years ago, where our primary traffic channel was turned off. Look, when you have a business, when you have a web based business your traffic generation, your flow of visitors to your website, to your marketing, to your funnels, that is the life blood of your business. That, coupled with your conversion vehicles, your marketing funnels, marketing campaigns.
When your traffic gets turned off that’s the equivalent of having a store, a retail location, and having nobody come in anymore to your store, no way for people to come in. What I’ll say is the valuable lesson, without getting into the nitty gritty, the weeds of that … Look, I’m going to say two things. One is, I learned the valuable lesson that you never want to have one single source of new customers. You don’t want one single source of traffic, one single source of lead flow, one single source of customers. You don’t want one really of anything in your business because with one of anything your business is incredibly vulnerable.
When you’re dealing with third party platforms like Facebook advertising, Google AdWords, Twitter, or any of these other third party platforms, at any time they could change their terms of services, they could institute new terms of service and make it retro. I’ve seen over the last decade and a half some crazy things that you would never think of. Same thing with many, many moons ago, there was fax broadcast and one day people building their business on fax broadcast, and then it was illegal. There was voice broadcast, where you didn’t permission, you know, robocalls, and then those were gone. You’ve got to have multiple channels of acquisition for your business. One of anything is really bad.
The second thing that I’ll say for everybody is you’ve got to recognize that problems, obstacles, that’s a natural part of what we do. As entrepreneurs our chief role really is problem solving. Whether it is solving the problem of not enough traffic, not enough customers, not enough cash flow, too many expenses, or we’re missing somebody on our team, or we’re inundated with tasks, or we have an angry customer, or we don’t have product delivery emailed, or the cost of our product is too expensive, or we need to figure out a membership [inaudible 00:12:54]. Whatever, these are all problems that we need to solve. Don’t be surprised when issues come your way. Deal with it, recognize mentally that you’re going to come face to face, you’re going to have some battles, but recognize that everybody does at every level of the game.
Josh Felber: Right, that’s the truth. I think that’s a great way to really take a look at it, is one of anything is bad. Whether it’s traffic, whether it’s not maybe having additional suppliers if you’re a product based business and things like that.
Todd Brown: One location for your passwords, one location for your files, just thinking of what people [inaudible 00:13:32]. If you’ve got one place where you’ve got your list of emails, your customer list, if that’s in one place you are incredibly vulnerable. Something, God forbid, happens to your … You just don’t know and so one of anything is always a very dangerous position to be in, especially when it comes to third party traffic, especially when it comes to traffic generation, no bueno, no good.
Josh Felber: Cool. Can you stick around for a minute? We’ve got to take a fast break.
Todd Brown: Absolutely.
Josh Felber: Awesome. I am Josh Felber, you’re watching Making Bank and we’ll be right back.
Josh Felber: Welcome back to Making Bank. I am Josh Felber. We’ve had the privilege today to speak with Todd Brown, the expert to the experts of funnel making and driving traffic and all sorts of internet marketing solutions. Todd welcome back to Making Bank.
Todd Brown: Thanks so much, super pumped to be here man.
Josh Felber: Cool. We left of telling us a little bit of challenges that you ran into, some different ways that you thought to really bypass that and eliminate some of those things. As entrepreneurs we are the problem solvers as you said. Now you’re building your business and I guess as entrepreneurs like myself, my wife has product company, Primal Life Organics, it’s a skin care company, and my daughter just launched our company about a month ago now, it’s Paleopet, it’s all pet care products, organic. She’s eight and so I’ve been teaching her how to drive traffic.
Todd Brown: That’s awesome.
Josh Felber: Facebook Live and all these kind of things. Let’s say you have somebody starting a new business like that, where would you say, “Hey, here’s the best place to start generating traffic,” because one of the things I had to explain to her was, it doesn’t just come, don’t just open the doors and traffic shows up. Where would you point people into starting to grow and build that flow of traffic for their business?
Todd Brown: Yeah, I think two things. One, typically, nine out of 10 times Facebook is the place to go. Not Facebook from a social perspective but Facebook from an advertising perspective. Facebook advertising, it’s not only incredibly simple to get started, you not only have full control over your budget, but they’ve got arguably the deepest targeting options of any third party platform. We can pinpoint the exact target audience in 99 out of 100 businesses.
Facebook advertising is typically the platform to begin with. The thing that I would say even first before you think about the traffic platform is the single most important thing for every new business to understand, to develop, to optimize is, what is the system, the vehicle that you’re going to use to acquire new customers at a reasonable cost? Let’s unpack that a little bit. That’s the answer. That’s the question really I should say, that is the million dollar question for every new entrepreneur, every entrepreneur starting a business.
That is, how are you going to acquire new customers at a reasonable cost? What does that offer look like? What does that pack look like? What does that message look like? What is the first web page if you’re a web based company that you’re going to send people to? What are you going to have them do on that page? What’s the sequencing of the message that you’re going to expose them to that’s going to allow you to acquire new customers from cold traffic.
Cold traffic is there’s no relationship to you. They don’t know you from Adam. They’ve never heard of you before, before this one contact. It’s traffic that we’re going to generate by running an ad or an advertisement on a platform like Facebook. First and foremost, how are you going to acquire new customers? Until a company, until an entrepreneur has that nailed, nothing else matters. Don’t worry about buying office furniture, don’t worry about a printer, don’t worry about a virtual assistant, don’t worry about logos.
Don’t worry about any of that stuff because at the end of the day what provides the stability and consistency within your business is what’s called the front end, is the ability to acquire new customers from cold traffic at a reasonable cost. And to finish unpacking that little nugget for everybody, when I say reasonable cost this is what we teach all of our clients at Marketing Funnel Automation, we let them know that when you are acquiring customers, which is the front end. The front end is all the marketing that you do with prospects in order to generate customers. It’s all the marketing that’s done to acquire a new customer, to generate that first transaction. Back end is all the marketing that gets done with existing customers to generate profit and increase life time value of a customer, what that value is worth to us.
When it comes to the front end and designing and marketing campaign for customer acquisition, it’s very different from designing a marketing campaign to grow life time customer value. The whole goal of a front end customer generating funnel is maximum new customers at break even. That means, to keep things real simple, if we invest $1,000 in traffic, $100 in traffic, whatever the number is. If we invest $1,000 in traffic all I care about is that I recoup that $1,000. That’s it. I’m not trying to make 2,000, I’m not trying to make 3,000, I’m not trying to make 10,000. When we’re starting out a new venture all we’re doing is trying to break even.
When you do that, that’s the equivalent of acquiring new customers for free. It’s the equivalent of acquiring leads for free. If I generate … Let’s say I’m selling a product for $100, and let’s say hypothetically we invest $1,000 in Facebook traffic, $1,000 in expense and in investment in Facebook traffic. Let’s say we generate 100 leads. We generate 100 leads, out of 100 leads, to keep things real simple, 10 buy. 10 buy at $100 a piece, that means I’ve recouped my $1,000 of ad spend.
But what that really means is that I’ve just acquired 10 new customers and another 90 leads for free. My bank account is no less than what it was the day before, now I have 10 customers that I can plug into the back end, that I can expose other offers to, other funnels, other marketing campaigns, promotional offers from affiliates or joint venture partners that I feel are valuable, and I’ve got another 90 leads that I can also expose to other front end customer generating offers. All at zero expense because I recouped my ad spend.
Josh Felber: With that, is there ever a point when you say, “Okay, let me ramp this up so instead of just a break even I’m making a profit on that front end?” Or is it, “Always our whole focus is always just to keep ramping it up but stay break even?”
Todd Brown: No, it’s interesting, it’s a great question. I’m so psyched that you asked this. Nobody asks this question. The fact that I’m getting to talk about that on your show pumps me up.
Josh Felber: Awesome [crosstalk 00:21:20]
Todd Brown: The funny thing is, is that if anything you go in reverse. What I mean by that is this, there are three levels … Let’s back up for one second. There are three levels of entrepreneurs or marketers, or the way marketers invest in the acquisition of customers, in the generating of customers.
The first level is what I refer to, what we teach our client, it’s the mom and the pop. That’s the way the traditional business owner invests. They say, “If I spend $100 on an ad, on a small space ad, on direct mail, on Facebook advertising,” whatever, they want to generate profit. Meaning that if they spend 100 in order for them to have a winning campaign they need to generate at least $150 in sales, maybe even $200 in sales.
That’s because the typical mom and pop, they don’t understand the difference between front end and back end. In their mind everything is a transaction. To them a transaction, whether it’s the first transaction with a prospect or the tenth transaction with a customer, in their mind every transaction is designed to the same thing, and that’s to generate a profit.
Then we’ve got savvier direct response marketers. Savvier direct response marketers that understand there’s the front end, there’s marketing that you do strictly and solely to acquire new customers, and then there’s marketing that you do to generate profit, which is with existing customers. That’s break even. When you’re just starting out that allows you to … You invest a dollar and your goal is to get back a dollar plus a new customer, plus leads.
But the most advanced direct response marketers, the marketers that are able to grow the fastest, like often times when average entrepreneurs, average marketers wonder, “How did they grow so quickly?” They are actually going negative. What that means is that means that … I’ll tell you the two things that you really need in order to be able to do this because we start all of our clients at break even because it’s the safest place to be.
You have a thousand bucks, we just want that thousand bucks back. This way your bank account is not going down, you’re acquiring customers, leads for free. When your company, when your business matures a little bit, and let’s say for example Josh, let’s say hypothetically you were selling a magazine subscription, a high end magazine subscription that was $100 a month, right?
Josh Felber: Okay.
Todd Brown: It’s 100 bucks a month, now let’s say that on average the average subscriber, the average new customer that you get stays with you for five months. Let’s use this same example that we did before, we spent a thousand bucks on Facebook ads, we generated 100 visitors, 100 leads let’s just say. Out of those 100 leads, 10 people bought. That means that we just generated a thousand bucks, we recouped 100% of our ad spend, we still have 90 leads.
Now we have these 10 new customers. In this case, in this example, those 10 new customers will now stay with you on average for five months. Some might stay with you for eight months, some might stay with your for 10 months, some might stay with you one month, but let’s say that when we look at our metrics we see that the average customer stays with us for five months. That means that the average customer is really worth $500 to us.
When you know your numbers, when you know your lifetime customer value, when you know on average that a customer is worth 500 to you, and you’ve got the cash flow to float, you would probably most likely be willing to invest more than $100 to get a $500 customer. If I said to you, “Hey Josh, for every $100 that you give me today in five months I’m going to give you back 500,” you’d flip. You’d say, “Of course I’d do that.”
Josh Felber: Sure.
Todd Brown: What if I said to you, “Would you give me 200 today for that 500 in six months?” It’s called going negative because I might be willing to spend $200 to get a customer today even though they only spend $100 with me today, because I know that in a month I’m going to get that 100 back and be at break even, and then the month after, the month after and the month after I’m going to be in profit. Does that make sense?
Josh Felber: Definitely. One of the things then, and I know it was important that you said it, was part of when you go negative though is also have to have the cash flow to float it.
Todd Brown: You have to have two things, and that’s why this is …
Josh Felber: Yeah.
Todd Brown: Look, you can build a monster business, a very successful direct response based business by just running your [inaudible 00:26:22] campaigns at break even. If you don’t go negative at all you can build a monster, monster business, because the mistake that most people make is trying to generate a profit on the front. If you’re willing to go to break even, you’re going to have more money that you can invest to acquire the same customer that somebody else, a competitor who’s not willing to just go to break even, they’re going to have to spend less so you’re going to be able to do a lot more.
When you become mature, your company, and you’ve got the cash flow to float and you know what that float is, like you know, “All right, I have to be able to float $100 for every new customer for the next 30 days to get to break even.” You have that and you know your numbers, that’s the thing. Let me say this, tag this on, we’re in the numbers business. We are in the number, we’re in the arithmetic, mathematic business.
This is not brand institutional advertising, this is a quantifiable business that we’re in, where when done correctly you know what a visitor to your website is worth, you know what a lead is worth, you know what the average new customer spends with you today, you know what the average customer spends with you over the next two months, three months, four months, five months, six months, depending on the age of your company. Therefor you’re not making decisions subjectively, you’re making decisions objectively with data and metrics that are black and white, there’s no gray area there. That’s what we’re talking about. Cash flow, you have an objective number, and lifetime customer value, your metric’s an objective number. No gray area there.
Josh Felber: Definitely. Yeah, because I don’t want people to be like, “Oh cool, I’m break even so let me go ahead and start going negative.”
Todd Brown: No.
Josh Felber: We want to make sure we know and I think that’s really important too, is knowing what your acquisition costs, knowing what your lifetime value, what your lead is worth. Actually having those set numbers because then it’s just plugging those numbers in and looking at, “Hey, if I buy this much more traffic coming in, then this is how much more I’m going to be negative for this time frame.”
Todd Brown: Yes, absolutely. That’s why this is a topic that we could talk about for hours. But really you nailed it man, you said something that I hope that everybody really, really grasps and really takes to heart. That is that you need to know these numbers. For example let’s talk about one of the most valuable numbers that everybody should know from every traffic source for every funnel, that is average visitor value. Average visitor value tells you what is the average dollar value of a single visitor to a particular marketing funnel. In an ideal world it’s per traffic source.
If you were spending some money, if you’re investing money in Facebook advertising and you’re investing money in YouTube advertising, you would want to know what is the average visitor to my funnel? If you have one marketing funnel, one marketing promotion, what is the average visitor, an individual single visitor from Facebook, worth in that, through this funnel? What is a single visitor from YouTube worth in this, with this particularly funnel?
The way you can simply figure that out, by taking the total amount of revenue and dividing it by the total number of visitors per source. Now, the value of that number is enormous because it tells you exactly what it is that you can afford to spend for those two traffic sources to get a single visitor. This is why, Josh, this why for everybody you don’t want to just track what an average visitor is worth combined from all your traffic sources, because a visitor could be worth a dollar to you from Facebook but maybe from YouTube it’s only worth 20 cents. You should only then spend a maximum of 20 cents to generate a visitor from YouTube and you could spend a maximum of a dollar to get a visitor from Facebook.
When you know those numbers that’s a beautiful thing because there is no more guesswork, there is no more operating in the dark. Now you’re able to go over to Facebook and spend a dollar, go over to YouTube and spend the 20 cents. If you can’t because YouTube wants to charge you 48 cents, then you know that you shouldn’t be using that source of traffic for that particular funnel because for that particular funnel that traffic source is only worth 20 cents a visitor.
Josh Felber: Right. Yeah, that’s one of the biggest things for us up until recently, even probably five, four, five months ago, is we’re always guessing on the numbers. We implemented a company called Fully Accountable which gives us up to the minute daily stats of exactly where we are with everything, all of our traffic, what’s happening, our traffic sources and overall profitability of the company.
Todd Brown: Are you kidding me? Remind me when we’re done here, I’m going to set you up with a ConversionFly account, and for everybody listening if you’re interested you can go check it out. About I would say maybe two years ago I started on a question to find the perfect tracking application that reported every number that we needed, that tracked the type of funnels and marketing that we do.
We hired a development team and ran it through a … Oh my Gosh, and about I would say six months ago, maybe seven months ago, something like that, we finally launched it to the public. You remind me, I’ll have you setup with an account on me. You go in and enjoy, you’ll be baffled at what you see and what you can do with ConversionFly. It’s crazy. I love hearing the fact that you’re tracking
Josh Felber: Yeah definitely. You know I was going to tell you, and my question was coming up in a few minutes, I have, we got ConversionFly probably about a month or two ago, but I haven’t had a chance to get it implemented in there yet. We’re getting ready to relaunch one of our funnels so we’re going to make sure that’s all plugged in and everything is well. Yeah, the other one’s a whole CFO back end system [crosstalk 00:32:37]
Todd Brown: Got it, okay.
Josh Felber: But no, ConversionFly is awesome and from what I remember seeing and watching the videos and stuff, and the webinar and all that. It’s just getting it implemented with this new funnel. Yeah, definitely guys, ConversionFly. Todd’s got some great stuff going with it. If you want to have a link or throw it out at the end for everybody, that’s awesome.
Todd Brown: Cool.
Josh Felber: Cool. Let’s see, give me real quick, we got some really great information so far. Tell me a couple quick things, say somebody’s getting ready, we got our numbers now, we know where we are, we’ve been doing some testing, what are maybe three real good strategies or something that we can take an implement today with launching our funnel or that behind the scene stuff that direct response marketers use that maybe nobody else knows about?
Todd Brown: That’s a biggie, that’s a good one. I’m going to throw out in rapid alarming pace a few things. If there’s one that you want to talk about more cool, if not … First and foremost, one of the things that I would say, the first of four things that I’ll throw out is that, you really need to work on the hook for your funnel, what I typically refer to as the big idea.
One of the most valuable lessons that I’ve ever learned in the last decade and a half, that I learned from my buddy Mark Ford over at Agora, you guys may know him under his pen name, Michael Masterson. He really said to me one day, “We’re in the idea business.” We’re really in the idea business. We’re in the business of developing compelling interesting ideas, ideas that grab attention, ideas that peak intellectual curiosity as well as they’re emotionally compelling. I believe that far too many marketers settle for a mediocre hook, a mediocre idea. You’ve got to have something different, something unique, something interesting, something that your market has not heard before. That should be the basis of your funnel.
Second thing that I would say is, we often hear marketers are often taught that great marketing is all about benefit, benefit, benefit, benefit, benefit, benefit, right? What’s in it for the prospect? And it is, at the root, at the foundation of every great marketing funnel is, what does this mean to the prospect? What is the primary promise? You’ve got to have a primary promise that is big enough, bold enough, audacious enough to excite the prospect. You can’t have a weak promise, you’ve got to have a big, bold, audacious, compelling promise.
One that is big enough to excite them. However one of the most valuable things that you can tie into that promise is what is called a unique mechanism. What that means is you’ve got to convey that your product, that your service is going to deliver that promise, is going to fulfill on that promise, is going to give the prospect the result that they’re after with a unique method. Whether it’s a unique ingredient in your supplement, a unique algorithm in your software, a unique process that you use in your therapy, a unique approach to dog food or whatever it may be. You have to have a big bold, audacious, exciting promise that is delivered to prospects by a unique mechanism. The third thing that is important for everybody, I don’t want to cover the same old things that other people [crosstalk 00:36:24]
Josh Felber: I know this is awesome, great stuff.
Todd Brown: The third thing for everybody to really understand is today more so than ever it’s important to recognize that you need both the emotional reasons why a prospect should respond. We’ve heard, anybody that studied sales or marketing for any length of time, you’ve heard, “People buy out of emotion, so it’s all about emotion.” It is, but it’s not only about emotion.
What that means is that the way I approach every funnel and the way my approach varies wildly from the majority of other marketers is, I don’t look at myself as a sales person, I look at myself as a prosecutor presenting a case. My job is to present a rock solid, air tight emotional and logical case for why the thing that I’m about to offer prospects is the absolute best solution to them. In other words, I’m presenting a rock solid argument, an argument that at the end they’re like, “I get it. I see that this is what I need.”
If we were selling, let’s say a paleo diet or something for pets, I would lead prospects to the point where they realize, “Any other diet would be doing my pet, my dog,” and my dog is sleeping next to me over here so I can relate, “would do him a disservice, it’s not the healthiest thing. I understand it. I understand why other food is not the way to go. I understand why paleo is right for him. I understand that it’s a certain type of paleo diet prepared a certain way, it’s not just any. I get it.” That’s where I’m going to lead them, before I ever even say, “Here’s my product.” The beauty is that get to educate. We get to lead the prospect to a point where they’re sold before we even sell, if that makes sense.
Josh Felber: Got it, right.
Todd Brown: Right?
Josh Felber: Yeah.
Todd Brown: That’s what we call the marketing argument. Two other things.
Josh Felber: Sure.
Todd Brown: I’ll throw in two more. One is the offer. The offer in the world of direct response marketing is really more important than the copy. It goes list, offer, copy. List, who you’re talking to, who’s the audience, offer, copy. You’ve got to go the distance when you are structuring your offers. Your offer truly needs to be irresistible and superior. Superior to what everybody else is offering. You’ve got to look at competitors, you’ve got to look at what they’re offering in terms of what are the features advantages, benefits, what’s the price point, what are the terms, what’s the risk reversal, what are the premiums or bonuses, what is the offer?
It’s your job to put together an offer that is superior and irresistible, an offer that makes prospects say, “Why the heck wouldn’t I do this? It’d be crazy.” Most marketers today, they settle for a mediocre plain vanilla. They settle for an offer that’s like, “Here’s my product. It’s 50 bucks. Get it now, if you don’t love it you’ll get your money back in 30 days.” That’s not an offer that makes somebody say, “Wow, I’d be crazy to pass up on this.”
The truth is that changing the offer, tweaking the offer, leaving everything else the same, everything, all the copy, all the headline, the idea, the argument, leaving everything else the same but changing the offer for example from a hard offer, “Pay now and then get the product and if you don’t love it you get a refund,” to a soft offer, for example, “Pay nothing now, get the product and only if you love it will you be billed 50 bucks or 60 bucks in a month.” That’s the kind of thing that can double, triple response. Double, triple response, you hear a lot of marketers talk about button color, background color on a page, those things can maybe impact conversion rate 1%, a percent and a half. The reality is your offer can double, can triple your response by changing it if it’s that good.
The last thing that I’ll say is you’ve heard people talk about adding on a one click upsell. A one click upsell is somebody buy, they go to your order form, they enter their credit card information, they press submit and then they come to an upsell. What the typical marketing expert recommends is to have an upsell that’s three times the price of what it is that the customer just bought. The customer just bought something for 100 bucks, they tell you to offer something that’s 300 bucks or up to 300 bucks. What I would tell you is to test just the opposite. Test what I call a reverse add-on. A reverse add-on is an offer that is anywhere from 60% to 80% of the price point of the product that your new customer just bought.
If they just bought something for $100, offer them something of additional value that helps them get quicker results, easier results, faster results that’s $60 to $80 in this example. If we just sold them something that’s 100 offer them something that’s in the ballpark of 60% to 80%. The reason for that is because that falls within typical consumer experience. That’s what consumers are expected, they’re accustomed to having. It’s like I say in trainings, “Where in the freaking world do you go, where in the world of commerce can you can where you’ll buy something and then they offer something that’s three times the price of what you just bought? Nowhere.” You go into the Apple Store, you buy an iPad, they don’t offer you an iMac. They offer you a charger, they offer you a case. That’s what consumers expect, that’s what they’re okay with. I would recommend that all of your viewers and listeners test that.
Josh Felber: That’s awesome.
Todd Brown: There you go, those are my bullets.
Josh Felber: Cool, that’s loads of information. I hope everybody’s taking notes here or rewind and watch it again. Todd just filled us up with tons of information to allow you to really start to transform what you’re doing online as well as maybe take a slightly different approach than what others are doing so you can actually take advantage of what you’re doing in the market, not just waste your money out there, spending it not getting the traffic, not connecting with the right type of clientele that you’re looking for your business. Todd I really appreciate that information. It’s exciting to hear that new spin, of what some of our people might see a new spin on it.
Todd Brown: Very cool man, my pleasure. I think that one of the things that I constantly think about, I constantly hammer into my team, and is appropriate for everybody to think about, it’s just differentiation. With marketing why do we invest so much time to come up with a great big idea, a great hook? Why do we spend so much time creating a superior offer? Differentiation is key. My buddy, a good buddy of mine, Rich Schefren, once said that better doesn’t always get attention but different does. Sometimes it’s when the market zigs you zag, because different will get attention. Don’t copy what everybody else is doing without making sure that you understand why it’s being done, what is the strategy behind the tactics, because that’s where the real gold is.
Josh Felber: Awesome. I’m excited, I’m glad you could come on, share a lot of wealth of knowledge of your marketing background. I really appreciate your time. Where can people find you? Where do you want them to go check you out at?
Todd Brown: Yeah, they can go to marketingfunnelautomation.com and check out the blog there. Certainly check out conversionfly.com, you could probably get a free trial over there.
Josh Felber: Cool.
Todd Brown: Yeah, that’s it man. It’s been my pleasure, dude, my honor. I love your passion for what you do man, I feel it from you brother.
Josh Felber: Appreciate it.
Todd Brown: My pleasure, any time man.
Josh Felber: Awesome. Todd, thanks again for coming on Making Bank. It was an honor to have you and I know our guests are going to love it so we’ll probably have to have you back at some point in the future.
Todd Brown: Any time. Any time dude, any time.
Josh Felber: Cool. I am Josh Felber, you were watching Making Bank. Get out and be extraordinary.