SFR 162: Scaling Buyers...
Boom, what's going on everyone. It's Steve Larsen - This is Sales Funnel Radio...
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And today we're gonna talk about how to acquire a mass of qualified customers.
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I've spent the last four years learning from the most brilliant marketers today. And now I've left my nine to five to take the plunge and build my million dollar business.
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The real question is, how will I do it without VC funding or debt, completely from scratch? This podcast is here to give you the answer.
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Join me and follow along as I learn, apply and share marketing strategies to grow my online business. Using only today's best internet sales funnels.
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My name is Steve Larsen and welcome to Sales Funnel Radio.
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What's up, guys? Hey, today, I'm actually going to toss in another recording from the Science of Selling Online Facebook group.
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I was reading from a book, showing them strategies from these various books.
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Not only how to acquire a mass of qualified customers, but when to acquire them. \xa0At what stage in your business it's important to do so and when is it not.
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When's the best time to actually go try and get a huge amount of customers? There is a time to do that and a time not to.
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You might be thinking, "Stephen that's stupid, why would you not just want tons of customers?"
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There's a lot of reasons why you should and why you shouldn't do that.
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In this episode, I'm actually gonna cut straight over to a Facebook live, but watch carefully because I'm using the very same strategy inside my business right now.
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I've created the main product for my business, so now that it's there, what front ends do I create to amass a huge list of qualified buyers, not just random people?
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Anyways hope you enjoy this, we'll cut over to the episode now. Talk to you guys later, bye...
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What's up. How's it going, everybody? Hope everyone is doing fantastic! I need to be asleep right now but... you know, some nights I just can't get relaxed.
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Yes, I wear glasses. I've had glasses and contacts since second grade. My eyes are terrible.
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I barely made it into the army - my eyes are so bad that I'm only a few points away from not being allowed to join... like isn't that funny?
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So anyway, yes I'm wearing my glasses right now. And I have been jumping on my tramp right there and listening to music and thinking a lot.
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I don't know why, but every once in a while, I just get in these zones where I just walk around, and I can tell that to everyone I kinda seem like a zombie - you know what I mean? \xa0My head's just spinning going through tons and tons of scenarios; it's fun. I absolutely love it. It\u2019s like a Beautiful Mind, "vroo, vroo" all over the place.
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I wanted to share a lesson with you guys real quick - because it's actually something that I'm doing right now. It's something that I taught a solid six-seven months ago. And it's interesting; what's happened.
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*REPLYING TO FB COMMENTS*
\u201cWhat's up guys, how's it going Ross? "Like your glasses, the real you." "Yeah, yeah, right. I cannot wait to get LASIK...
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I was at the eye doctor a little while ago, and he told me that I have clinically large eyeballs. I was like, "Oh. It's not like I can do anything about it. Thanks for making me self-conscious for the rest of my life!"
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I want to share with you guys something that you need to understand.
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We talk all the time about going at the core of the value ladder, right! That is the place where you start your products.
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You start your business at the core of the actual value ladder. The reason why is because everything else kind of spiders out from there. What I want to do is - I want to tell you why. I wanna tell you why everything spiders away from the core of the value ladder... it doesn't have to do with creating the back ends.
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The market's gonna tell you what to do, all that because yes, yes, yes, yes, but another big reason has to do with one of the principals from the book, Ready, Fire, Aim.
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I was flying back home from speaking at an event in January, and I ended up doing a few Facebook lives in the airport, and one of them was about this very principal right here. It has more to do with the way the cash actually moves inside of the business.
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A little while ago, a customer was frustrated, and she came up to me, and she said "Hey, do I really need to go create products? Do I really need to go make..." Anyway, she was being whiny.
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And what I said to her was "Look, a customer is purchased regardless. You will buy a customer whether or not you want to. There's a cost to it."
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Most of the time when we think of average cart value and cost to acquire, \xa0those are the only two numbers that we really care about in a marketing funnel.
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However, cost to acquire we typically always assume means money. It actually can mean time as well.
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So what I want to do real quick is, I want to talk real fast about the realities of what it actually means to acquire a customer. And when it's best to go and... Let me step back.
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There's a thought; I keep trying to get it out for you guys, so you understand what I'm trying to go for...
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Somebody was probing me, they're like "Stephen, why has your funnel not hit passed a million bucks already?" And I said, "It's because it's not scalable yet." And they're like, "What do you mean?"
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There is a podcast episode coming out about this soon. I "out-revenued" the systems in my business. Does that make sense? My revenue was growing faster than the business.
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This has happened multiple times; I would build a freaking awesome funnel, then we put it out there, we'd launch it:
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Day #1: They're excited. They're like, "Oh my gosh, this is so cool. Look at all these sales coming in!"
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Day #2: They're like, "Wow, that's a lot of sales!"
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Day #3: They're like, "Turn it off, turn it off, you're going to bankrupt us!"
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I remember the first time that ever happened to me, it was well before I ever worked for ClickFunnels. And this company, I almost bankrupted them.
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And I was like, "What? That doesn't make any sense? \xa0I've never met anyone ever who wants fewer sales!" I didn't understand what happened until later on when I was working for ClickFunnels.
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I was sitting next to Russell, doing all this stuff. He and I were building a funnel for FiberFix, and the exact same thing happened. We basically, two and a half, 3x-ed their revenue in a couple days. It was like "BAM!" Really fast. Same story:
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Day #1: "Wow!"
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Day #2: "Whoa!"
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Day #3: "Stop, turn it off, or you were gonna bankrupt us!"
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I was like that's so weird. And I don't know why but until that time.... I mean, I knew that funnels weren't businesses. A funnel is NOT a business, right? Funnels are not businesses. A funnel is a way to sell stuff, right?
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I am a master at the funnel building side, however, I know I'm not a master at the building the business side. I've had to learn that stuff as I go along - because my revenue was outpacing my business.
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So let's go back. Let's think about this; when we think about "cost to acquire," there are multiple costs to acquire:
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#1: There's a cost to acquire as far as money goes.
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#2: There's a cost to acquire as far as time goes.
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If you're not willing to pay ads to acquire a customer, you're gonna pay with your time, right?
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I'll go do that with my podcasts, right? That's one way I'm purchasing a customer with my time.
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I don't like doing methods where I have to do the same strategy over and over and over again; meaning, I'm not good as the guy who's like gonna spend time doing the same pitch to tons of people. I'd rather do the pitch one time, and automate it through a funnel to leverage my time that way.
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#3: There's also a cost to acquire as far as your business goes and the
stress that causes on the actual structure that you've built.
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If you don't have a structure \xa0- if every single support ticket is different - If you handle a support ticket differently every single time...
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If you handle a customer complaint differently each time...
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If every time somebody purchases from you, it's a different scenario every single time...
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YOU'RE GONNA DIE!
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That's part of the stuff that I was running into the first three months of this year.
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I was selling, selling, selling, selling, selling.
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I did over 200 grand real fast, bam, real quick. \xa0I was kinda the sole operator, and everything slowed down. I was like,"What's happening? Holy crap, a lot more people still want this thing, how come I can't push it forward even harder? How come I can't... " \xa0\xa0I had to step back.
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And while I'm a funnels guy, I needed to become a business systems guy too.
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And so what I've been doing a lot lately; I\u2019ve been setting up systems that allow my funnel and my revenue to become scalable.
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We're just about hitting that point right now.
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We just tested this SLO, it's doing really well. It's converted, last I checked, \xa0around 15%, which is great. That's great for a self-liquidating offer for a webinar. It's good enough anyway - at least to take the edge off. It's going good, going really, really well.
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What I wanna do real quick is I want to, first of all, put my glasses on, 'cause I really can't see you guys. My vision is that bad. What I wanna do real quick though, is I wanna read to you why this happens.
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I'm at this phase right now... I wanna show you guys one thing real quick here. I do not regret building it the way I have. I don't believe you're an entrepreneur if you don't go actually create something of value.
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Like, alright there are business owners, and then there are entrepreneurs. They're not necessarily the same thing.
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A business owner comes out of college, "Hey, I'm gonna go build a business." They get VC funding to fund the structure that they're putting together. Rather than go create value first to make money to build the structure. Right?
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I believe an entrepreneur goes and makes value. They get paid for it, and then they use that cash to build the system to let them go sell more. That's what I've been doing.
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And so, what I'm trying to get at here, what I'm trying to share with you and show, is this phase that I'm entering. I'm really excited.
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There are a lot of phases all over the place, but the ones I'm talking about today are:
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#1: Does the market even want what I'm freaking selling? Do they want it?
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Answer: "Yes" I'm making cash from it. We don't even have ads running right now, and there's still sales - which is awesome. It means it's selling by word of mouth which means there are ravenous buyers and ravenous evangelists. Which is awesome. \xa0
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So is it selling? \xa0"Yes." Is the market telling me they want it? Yes, they are. Okay. Next phase...
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#2: Let's turn it up. Boom! "Oh my gosh, my business structure can't handle it."
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- Too many support tickets
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- Too many things coming in
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- I'm the sole operator, "Oh my gosh, I am drowning." I'm now working "in" the business instead of "on it."
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- I need to turn down my revenue and turn up my systems.
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Does that make sense? 'Cause that's what I've been doing. But now that I'm about to enter this other phase, and it's part of the reason why I'm doing Affiliate Outrage.
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I wanna share with you why I'm steering the ship the way that I am.
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Is this cool? First of all, I hope this is cool? That's what I mean when I invited you guys to this group... "the deep dark secrets of Stephen's mind."
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This is the stuff that just rocks through my brain. And I'm just connection, connection, connection...
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I'm linking together several different books right now, and what I wanna do is read a section here to you guys from Ready, Fire, Aim, and tell you why I'm doing what I'm doing:
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Anyway, you guys ready? Here come the glasses. I think my vision is like negative 6.5 or something like that. I mean it's REALLY bad. I think it's 7.5 was like the army cut off, and I barely made it. I cannot wait to get LASIK. I will be a life changing event. I mean, I'm serious, I'm so blind.
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My hand is in focus finally, when it's about right here. Barely, isn't that nuts? Anyway, I'm actually quite blind. And no it's not because of all the computer screens. I started when I was in second grade.
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This is a section, this is a chapter here from Ready, Fire, Aim. This is on page 118. Fantastic book! If you've not read it, I recommend it completely.
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- The first section is dedicated to the systems on the marketing side and even on the business side that you need to put in place to go from zero to a million.
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- The second part of the book is one to ten million.
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- The next part of the book is ten to a hundred million or fifty million - and then goes beyond that.
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I've only read the first part, 'cause that's all I care about with this funnel right now. And while I have a 2 Comma Club award, it was with Russell, and I want my own. So that's why I'm documenting my journey along the way.
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Check this out, pg 118, this is how I read books, and this is the reason why it takes me like three months to read a book if I'm being active about it.
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Alright, so here it is. \xa0Check this out. Right, where my thumb is\u201d
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"So although your primary focus should always be on customer service, your quantifiable goal at this stage of an entrepreneur should be to acquire as fast as possible what we call a critical mass of qualified customers.
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The number of loyal customers you need in order to make all or most all of your subsequent selling transactions profitable."
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English, what does that mean?
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Let me read it again real quick, and then we're gonna dive into this.
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"Although your primary focus should be customer service, you need to acquire as fast as possible a critical mass of qualified customers.
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The number of people in order to make all of your transactions profitable."
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Let me keep going here.
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"Once you have a good number of qualified customers, you'll be in a really good position where almost every new product you come out with will be successful because so many of your existing customers will buy it."
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Does this make sense? Follow me here. Let me keep going, one more part here.
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"You need to understand the dynamics of generating long-term profits through the development of large circulation, low-cost products, sold at a loss on marketing by upselling high-end products to this larger base."
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This is a lotta crap, right, this is a lotta crap. Follow me though. Now, let's go through and let's read my squiggles.
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Let me flip this around here again, real quick. Here's my squiggles...
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If you think about this, what this is saying is:
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#1: \xa0Acquire as many customers as fast as you can. As fast as possible acquire a critical mass of qualified customers.
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#2: \xa0Once you have a lot of them; every single subsequent transaction will be profitable because so many of the existing customers will buy your upsells. That's saying use freaking funnels.
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#3: \xa0The way to do that is by producing large circulation, low-cost products that you sell at a loss.
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Does Russell Brunson actually make that much money by selling his book alone? No, he doesn't. What actually makes it profitable? All the upsells in the back.
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Here, let me go full circle. Follow me here ...
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Think about where I am in my business. I know the market wants my product.
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I've actually completely shifted who I'm selling to.
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Just recently, in the last two weeks, I realized I'm selling to the wrong person. So I'm redoing a lot of stuff, I'm changing the vernacular, I'm changing ads, I'm changing a lot of stuff, and I'm readjusting and realigning for the right person. "Oh, my gosh, you were here all along."
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Markets are discovered, they're not created. New markets, blue oceans, purple oceans are discovered.
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You don't set out and go, "I'm gonna create a brand new niche." It doesn't exist! How can you measure it? You discover niches.
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I have been discovering this new niche because I'm actively selling inside of it, and the market is telling me how to move.
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Now that I know that the market wants me to sell it, that product, and I'm like, "oh my gosh, my revenue is outpacing my actual business." so I stopped for a while and fixed the business, and now I'm turning the ads back on. The engines are turning back on again.
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What I'm really doing now is exactly what Ready, Fire, Aim is teaching. Which is I am creating low cost, low price, high circulation products. Does that make sense? Those are the qualifiers.
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When you figure out the core of the business, which is what I've done now, the core of the actual business that you have, your role, right,
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I've gotta a sweet back end product that we're gonna go create here soon, I want my own event. I think it'd be super cool, and I really think it can help a lotta people. So that'd be a lotta fun. The cool back-end product for me is events and consulting.
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Front-end though, low cost, low priced. So they're low cost to you, they're low priced to the consumer, but they are high circulation.
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Do you guys know that when somebody buys a book, on average, it gets passed around up to nine times? Nine times! So when you sell a book to somebody, there's a high potential that it actually gets read by nine people.
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That's the reason why we sell so many books. It's the reason why we do so many FREE + shipping things. So the FREE + shipping CDs, info, information, right? Little knick-knacks here and there, funnel graffiti - stuff like that.
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It's not to make money, it is to acquire a critical mass of qualified customers. Precisely what Ready, Fire, Aim is talking about. Does that make sense?
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But the problem is is that most people, before they know what the core of the business is, they start with low cost, low price, high circulation products. That's why I don't usually recommend going into things like e-com right out the get-go.
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You can do e-com by bundling it with info, and then suddenly you're margins go really high again.
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So if I now have a critical mass of qualified customers, they're buying everything... The second "yes" is easy, once the first \u201cyes\u201d happens - they're buying a lot of my subsequent products - everything you're coming out with your existing customer base is buying it.
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A low price, low cost to acquire equals a big customer base for your back-end products. Those are the three categories though. Low cost, low price, high circulation potential. That's really what you're going for at those phases.
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If I go and I create a critical mass of qualified customers in the middle of my value ladder...
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I was drawing a value ladder; I was on an airplane, listening to dubstep, \xa0there was caffeine in my system, and I was at 30,000 feet, which usually is when I have all these epiphanies. I need to take more flights ;-)
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I have a critical mass of qualified customers right there in the middle, so I was looking at this, and I was looking at some of my different numbers. And what I figured out is that for me to hit a thousand buyers at $1,000, right, that's a million bucks, I was working backward...
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If I have a 15% close rate on live webinars, let's say that's high though, right? I would need to spend somewhere around $166,000 to make a million.
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Now, my product is worth way more than $1,000. So what I'm doing is I am actually gonna double the price of it, I'm really excited.
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Actually, no, no, no. It's a different product I'm doubling.
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I'm gonna raise it $500. And it's because one of the issues that I've been finding is as I narrow it down on what it is I'm actually doing is selling to the wrong person. And the wrong person was coming to me.
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They would say things like, "What's a funnel?" And I was like "Psh.. oh my gosh, I am probably not your guy to start out with if you don't know what a funnel is, right? Go read some books, go read Dotcom Secrets, Expert Secrets and then come back to me." In fact, that's my recommendation to everyone. Go read:
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- Launch
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- Dotcom Secrets
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- Expert Secrets
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- Ready, Fire, Aim,
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These are my go-to books always. They're always on my shelf. Actually they're not on my shelf, they're all around the room, 'cause I reference them so much.
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Trying to remember what the others are? I just reorganized everything, which means I can't find anything anymore. You guys know what I'm talking about? Anyway, Ask, that's an awesome book.
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*STEPHEN ANSWERING FB COMMENTS*
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"Terran, yes. Yep, I am referring to that. MLM Hacks, that's my main webinar right now.
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I have a second insanely awesome product I just finished building it today. Oh my gosh. Right, 'cause not everyone's an MLM. And I totally get it. And if you don't wanna be, and I still have sick funnels for you. So how do I go serve you guys then? So anyway, so I'm super pumped about it."
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So that's the whole lesson... 'cause I know one of the things that happens to a lot of entrepreneurs is what I'm talking about right now.
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They're going out, and they're saying things like, "I'm selling like crazy and then all of a sudden, the sales kinda seem like they slowed down."
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#1: You probably have ad fatigue.
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#2: \xa0Did you just sell to your hot market, and the warm really isn't that attracted to it?
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And I had to figure out a little bit who my real customer was. But then I voluntarily slowed my revenue down. Hard. Hawd, HAWD.
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Way back, I turned it off - I didn't slow it down - I turned it off. It's been off for a while. And it's because I'm doing this massive overhaul.
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Here check it out. Alright, check this out. Wrong side, okay, this side of the whiteboard right here. Right, I've been redoing all that. It's a freaking huge funnel now. I didn't start that way. You don't need to start that way. But this is what I've been building.
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I've just finished the SLO, it's converting like crazy, it's doing fantastic.
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Next I'll be building out a product launch funnel inside the replay sequence.
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Then I'll be going in like this awesome, insanely amazing success path, it's 30 days, it's 30 videos showing them after they buy, how to be successful with their purchase.
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Very key, it's not enough to just sell 'em, you gotta show 'em how to use it and be successful with it, or you're dead in the water. And so, that's how we do it.
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When I realized like, "Oh my gosh, it's all working," then finally I was like okay, this makes total sense for me to go and let's try and acquire as fast as possible even more qualified customers and buyers. And so what I've been doing.
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That's one of the major reasons, (cat's outta the bag), for Affiliate Outrage. Now there's nothing paid in there, upfront. But it leads to paid things.
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All it's doing is widening the net - and it's being really, really open. It's teaching anyone how to be an affiliate for any product.
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\u201cYou guys want the rest of the strategy? \u266a Yeah \u266a Everyone say... \u266a Yeah \u266a You gotta give me the... \u266a Yeah \u266a Like that.\u201d
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Everyone was making fun of me on the 2 Comma Club coaching stage, 'cause I guess I do a lot of sound effects. I didn't know that.
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You guys ready for it? 'Kay, check this out, alright. If you listen to my podcast, you know that the only two things on my calendar. The only things on my calendar are events and launch dates.
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I've got Affiliate Outrage; then I've laced together like six different campaigns that I've seen make that really fast, usually.
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Who's got my money, hey, Love Grant Cardone. \u266a Who's got my money \u266a So anyway, I laced together six different campaigns and I'm going one by one by one through all of them. So just watch carefully to what I'm doing here because now that I know the market wants what I'm selling, "oh baby, now we get to open the freaking floodgates."
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I feel like the other thing that happens too; a lot of the times in this community, people spend so much time building the funnel. That's just the first piece of the pie. Next, you get to go do a lotta cool things like Dream 100 stuff.
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We've been reaching out to massive people, and they've been reaching out back. And excited to promote it.
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*FACEBOOK COMMENTS*
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"What do you think of Sam Oven's 20 million dollar webinar funnel?"
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"I think it's awesome, and I think it's proving the exact point I'm talking about, Kenny. When you actually know what the heck you're selling, ] when we actually know, then man, stop messing with the funnel and start figuring out cool ways to just put traffic into that thing. And that's what these campaigns are. Campaigns are not ads."
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Anyway, so how about that for a rant? That was a late night rant. I was jamming out, I have a playlist called Pre-Stage, it's my pump up mix.
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That's the lesson tonight, guys. Go figure out how - after you know the core after the market actually said that they want what you're selling - go figure out little tiny things that bring in the low cost to you, low price for them, high circulation potential. And then just open up those floodgates.
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Honestly, is super fun. It's the reason why we have so many awesome front-ends at Clickfunnels.
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*FACEBOOK COMMENTS*
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"What do you say to someone who is getting great front end conversions but leads are not buying? Referring to affiliate.\u201d
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\u201cWhat do I say to that? Terran, that's a great question, great question. If you look in Dot Com Secrets... I don't think the funnel is complete. If you look on page, I think it's 93, I don't remember, I'm not gonna take the time.
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Anyways, one of the seven phases of a funnel is, it sounds like you're qualifying the subscriber, which you need to, but you also need to qualify the buyer. That's the very next step.
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That's step number four of the seven steps, I think. And so, sounds like an incomplete funnel.
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So it's not to say that lead funnels are not complete funnels, but if you're trying to make sure there's an up, like they're actual... If you know you're gonna lead them to something that's expensive in the back, or even buy something later on, the funnel isn't done, in my mind, until there's cash in your pocket.
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So that might mean that the funnel goes offline. That might mean the funnel goes on the phone. That might mean going and saying 'Hey, we gotta meet in person, or come to an event.'
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So the lead might be captured on the internet, but you might be capturing and actually closing and actually getting cash in your pocket, offline or different places. I know there's different scenarios for that. But you're talking about affiliate marketing. So what do I say to someone who's getting great front end conversions?
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What usually is happening is some confusion. There's a disconnect... Here's the story:
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John Parks was talking to this guy... \xa0he was critiquing his ads, and this guy had great conversions on his ads, and all these people were clicking on this ad. But no one was buying. And this guy goes to John Parks, \xa0(who is Russell's traffic guy), and says "Hey, can you look at my numbers, look at my ad, what's going on here?"
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John was like "Wow, you're getting a lot of clicks on this thing, how come nobody's buying?"
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And he goes in, and he starts looking at the numbers, the conversions, and he had like a 15% click-through rate on that ad, that Facebook ad. And John was like, "Whoa, like that's really high."
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Then he looked at the numbers for the next page, and there were no conversions on that page. There were no purchases at all. And he's like, "What's going on here?" He hadn't looked at the ad yet, when he looked at the ad, he knew why immediately!
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The ad was a picture of this incredibly sensual woman just dripping sensuality. \xa0And sure enough, it's guys that have been clicking on the ad.
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He clicks on the ad and goes to the next page, and the very next thing people see on this ad is this middle-aged, overweight white guy saying, "Hey do you wanna opt-in for X, Y, and Z?"
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That's not why they were clicking on your ad, buddy. Like right! So weird example right? But that's typically in some form what's usually going on.
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There's some disparity between what's actually going on from the ad, and to the actual page.
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One of the things that I like to do is to make the headline on the ad the exact same as the headline on the page they'll see. That way there's not a new concept that they have to accept. And it brings them straight on in.
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*NEW QUESTION*
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"If we are building webinars, three things to focus on?"
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"Yep, only thing you should focus on, and only worry about ever, for a long time, is just your story, the actual sales message itself. Don't worry about anything else.
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Once you know people are trying to give you money, then put together an actual offer. And then once you have a story, or sales message, I call them one in the same, you've got a sweet offer, then go obsess about the funnel.
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I mean there's a reason why I haven't gone in depth on thing yet at all. Like my funnel is limping along on one leg. It's broken. My funnel's broken, I know it's broken. And I haven't cared.
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It's like trying to fix a leak all the way down a pipe when there's actually a leak further upstream on that pipe. Does that make sense?
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It doesn't matter you fixed that other leak, you gotta go fix the one in the beginning, right?
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I don't know if that makes any sense at all. But like, anyway, that's how I think of it that way."
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*NEW FB COMMENT*
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"Thanks for all the value."
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"Love the geek out over this. Awesome stuff. "
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Anyways, hey guys, hope that was helpful to you. I'm sorry that was a long Facebook Live there. Actually I'm not sorry, that's freaking awesome! I'm gonna download that.
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Anyway, so hopefully that's helpful to you though.
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So just recap from the book real quick here, real fast, all you're gonna try and do is
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#1: "Acquire a critical mass of customers."
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The existing customers buy every subsequent product you ever come out with which is why you just acquire as fast as you can.
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#2: \xa0You're gonna make low cost, low price, high circulation products, which is why I am doing things like Affiliate Outrage.
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We got a ton of front ends that I'm gonna come out with here shortly. Salesfunnelbroker.com as it currently is, like oh my gosh, it needs to be completely different.
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salesfunnelradio.com, oh baby! \xa0I've built so many funnels for so many other people, it's fun to like turn back around and finally do my own for a while.
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Awesome guys, talk to you later, have a good night.
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If you like this, please let me know. Keep inviting your friends to this page. I am trying to pull over people who like really freaking love why funnels work and who really geek out about this stuff.
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Alright guys, talk to you later. Go crush it.
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Ah yeah! Hey, wish you could geek out with other real funnel builders, and even ask questions while I build funnels live?
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Uh-oh, wish granted.
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Watch and learn funnel building as I document my process in my funnel strategy group. It's free, just go to thescienceofselling.online and join now.