This is the unfinished 1st draft of a book I started writing on the Key Person of Influence course.

Like most things that you leap into without a real reason for (other than fame and cash) it whithered before it was done, but there’s some useful ideas that I might expand on in other posts.

If you ssee anything good, let me know and I’ll drill down a bit more. My guess is there’s one good idea in here that’s actually worth writing a book about.

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Introduction 

Start with the customer’s problems

Broken SEO promises

No time to create constant new content

Fluctuating results

Websites that look nice but don’t make sales

Needing to please everyone with one page (Steve Krug quote about homepage is the first casualty of war)

 

The “If I had a dollar” question that inspired this book

I guess every industry has one.

A question that makes you want to say “if I had a dollar for every time I’ve been asked that question….”.

The thing is, you can tell it’s usually the wrong question. If not the person being asked would have got rich off answering it long ago.

For me, as soon as anyone finds out I know anything related to marketing online, the question is:

“Do you know how to get websites to the top of Google.”

I never answer it directly.

“Why do you want to do that?”

“For the free traffic”

Free traffic. The most dangerous two words in marketing.

No matter what it costs in time and effort, even real cash, when that click finally comes from Google, you haven’t “paid” for it, so it’s free.

Never mind that the economics of “free traffic” are anything but positive, there are some very good reasons why the traffic from Google is NOT what you want to be chasing and this book sets out why. 

It tells you how this huge myth came about, and it tries to show you what the successful digital marketers know about how to get website traffic, and what to do once you have it.

If you can grasp this, you’ll immediately have passed the velvet rope into the tiny percentage of marketers who can tell the difference between good and bad traffic, and are set to profit from that insight for years to come.

You’ll be bullet-proofed against the whims of a corporate super-power who has both made and broken businesses overnight with its algorithm changes.

And most of all, you’ll learn that the most valuable media owner on earth….is you.

Read on to find out why.

How I learned all this

Back in 1995 I got my first taste of the power of online marketing, way before it became the “next big thing”.

I was working for Longman English Language Teaching – an educational publisher in the UK, and our big news that year was our launch of an Interactive Encyclopedia.

It was a great product. An encyclopedia and dictionary rolled together with audio to help you pronounce each word correctly, video snippets about the entries in the encyclopedia. It was getting accolades not just from educators, but in the tech press as well. It was a great example of the capabilities of “multimedia computers”.

Back in 1995, the average office computer was a huge beige monstrosity, and colour monitors, CD-ROM drives, and loudspeakers were a rarity.

This presented a problem.

Longman had aimed this product at language teachers, but other than the very top end of the language schools that I’d seen in London, none of them had the equipment to run this product.

I’d even had to do some pretty serious arm twisting to get the budget for a new PC in Longman’s own marketing department so we could demonstrate the product ourselves.

I was convinced, like everyone that the product had great promise, but unlike the rest of the business – firmly entrenched in selling to schools –  thought it lay elsewhere.

I just need a way to prove it. 

I managed to convince the product manager to put a short feedback card in the product under the guise of being able to sell updates to private buyers.

Then I sat back and waited for the first cards to roll in.

To this day I remember the first email address I ever added to a marketing list.

It was a technical sales representative from IBM in Sao, Paulo in Brazil.

Not a language school, not a teacher. A sales guy at computer firm.

Someone with a real need to improve his English skills. Someone with big budgets behind him to do it, and with enough personal interest in this problem that he may well have paid for it out of his own pocket.

In many ways he was one of the most perfect prospects I ever found.

Over that week I collected about two dozen more cards, and only a couple were from educators of any sort. The rest were from people in technical industries where English was the common language, trying to perfect their skills for their own personal development and the success of their businesses.

So, I had an email list and they were mostly business people, who had bought a quite generic English teaching product.

I figured we should send them something that would be more appropriate for their particular situation.

 I had a trawl through the publishing catalogue and turned up some products that were ideal for these prospects.  A set of cassette tapes for learning business English. 

Language courses were fairly expensive in those days. Probably two or three hundred pounds, I think they were. I pulled together a short sales letter saying, “We’ve seen you bought this CD-ROM product. Well done on the work you’re putting into learning English, and we notice that you’re operating for a business. We think this product might be useful.”

 I did a second page which had an order form that they could send a [inaudible 00:00:54] or fill in with a credit card, put it in a Word document, and I was going to email it out to the first guy.

Now, something you should know about me, something I should have mentioned, is that I work quite hard. I put a lot of hours in. I really study what I do. But in some things I can be really, really lazy. 

One of those things is anything that involves any kind of repetitive task I just don’t want to touch. I looked at this list and thought, “God. 25 times I’ve got to put the email address in, write the letter in the email, attach the document, send it off, go back.” Even doing that half a dozen times is too much for me.

There was a little programme you used to get with Microsoft Windows in those days called a keyboard recorder. 

You’d do one set of actions, cut and paste the email from a spreadsheet, put it into the email tool, cut and paste the letter out in Notepad, put it into the email tool, attach the document, hit send. Do that once, then you hit, “Go,” and it just repeats it again and again and again. 

We had nothing like MailChimp in those days. This was about as close as you could get to automating that list.

I fired off, went and made myself a cup of tea, came back, and my campaign was done. The thing that really astonished me was, I had the first order back by the end of that day. No waiting for your mailing to sit at the post office for three days. No getting sorted things. No trans-Atlantic delivery to Brazil and back again. It was there. Sent the order out, came back by fax, had each one of the sales girls type the credit card details in, that was it. Order went out the next day.

For somebody who’d been brought up in burrow mail, where you might have to wait a month for this, that was a real revelation for me. The speed of this is what really hooked me. 

I love fast, fast feedback. Where I can see that I’ve done something right there. 

Over the course of that week, almost half the people who I sent that email to responded back and I made over 2,000 pounds, which at the time, was a big chunk more than my monthly salary, so I paid for myself in an afternoon’s work. 

The cards kept coming in from the product, and we had a stable line of business, which was paying for the person to do it, even though it took me 20 minutes to type in the email addresses and a minute to send the campaign out itself. Then, maybe an hour or so for the girls in the sales office to process the orders and send the tapes out. 

That was my first foray into email marketing. Anybody who sent out a campaign of any size at all had a payment back within a few hours or would know the excitement [inaudible 00:04:06].

That 2,000 pounds still stands out as the most … Some of the most enjoyable money I’ve made online because it proves that you can do it. I can tell you, if we can do it without any other tools, without people being used to email stuff, without people being used to put credit cards into websites, and all the things we have now. If I can do it with all those disadvantages … You know, people are much more used to transacting online now, you can definitely do it from whatever sphere you’re in. 

To be fair, back in those days, there weren’t even that many people that had email addresses. I didn’t have my own email address for work for this thing. I had to sign up for a CompuServe account just to be able to send the email out. There was no work email address at [Longman 00:04:57]for me to send stuff out from or to get it back to. It was only people that worked in IT businesses or really big corporate … That were able to do this. 

It took awhile for the market to arrive. For the number of people with email addresses to actually sell to, to turn up on the scene. About the mid-90s, the dot com thing happens during the tail end of the 90s. In the early 2000s, I’m working for one of the first big email service providers in the UK. A company called E2 Communications, who have since been bought up by a company called Bluestreak, who do advertising selling. 

We had some really good technology there. We had a thing that was called, “Adaptive Sequenced Messaging,” ASM, which is the forerunner of what people call, “Marketing Automation,” today. Fairly basic. It could trigger off an email when you filled out forms, that was a kind of early auto-responder. It could trigger off emails if you opened or didn’t open an email within a certain timeframe, and if you clicked or didn’t click on an email in a certain timeframe. That was all you had at the time. 

We started doing some work for a company called ASOS. 

If you’re in the UK, you probably recognise ASOS. They’re a huge online clothing retailer, big fashion retailer. They’re probably the biggest online-only fashion business in the UK. Back then, they were very different. In fact, the initials ASOS stand for, “As Seen On Screen.” They were selling outfits that people had been seeing in the movies. They did a lot of … They moved into fashion, where they started selling outfits that celebrities had been seen wearing out and about. That’s how they became what they are now. They were very small in those days. 

We took on their email because they’d been running off a rather shaky in-house system not too unlike the one I described that I had at Longman. They wanted us to get their emails out much quicker, and with all the reporting that we could get them on if they were actually active. We took on their first campaign, sent it out to their list, and they got a fantastic response. I bit too much, in fact. There servers crashed with all the traffic that came in. Partly because we were capable of sending out millions of emails in an hour. It all came in in one go. They recovered the site, we carried on sending out the rest of the emails. 

Then they had another problem, which was that it was so successful, they started selling out of the products that were in the email. There were people getting it, going to the site, couldn’t buy the thing being promoted, which wasn’t great. Then they had another problem. Which was that they sold so much that they didn’t have the stock to handle it within their normal delivery promise. They had to pull in a lot of expensive temp workers and then, for the next few days, the home page of their site was full of products that were sold out. Not good all around. I mean, it was good that they had a lot of cash in a very short space of time, but planning-wise it was terrible.

We took on … We started using the sequence messaging for them. We had a few campaigns that we could send when somebody first signed up to the list. This gave them a much steadier set of income. We would also send it out at a period after somebody had purchased from them. We knew that if somebody bought from them, they probably wouldn’t buy for a couple of weeks, so we had a follow-up campaign. That follow-up campaign was to ask for reviews and all sorts of things. It was a much more even service. No big spikes in inventory. No big spikes in stocking the warehouse. No big spikes that we had to cope with with the website traffic. It was much better all around. Much more stable, much more predictable, much more stress-free. 

Then that also appealed to my somewhat lazy side of my brain, which says, “Set these things running. You can set it and forget it.” The reality is, the minute I’ve got something like that in place, I sit back, have a coffee, pat myself on the back, and then have another bright idea of something else I can layer over the top so it just keeps building. It’s fantastic because you’ve got this income coming from this steady set of campaigns that all of your new customers come from and nobody gets overlooked. 

That’s really the first start point of when I started using automated campaigns. I built this … I built lots of these for other retailers. I build them for Debenhams had one for their wedding list that was based off when somebody’s wedding date was. Built one for a company called Blooming Marvellous that were a maternity company that we would send out emails based on when their due date was. They had information about things you should be doing, things you should be planning, things you should be buying, all this stuff. There were also other companies as well. We had some from a lot of publishers that would go out based on the publication dates of their magazines or when people’s subscriptions were about to renew. 

All these businesses had an automated set of messages that would go out, make sales for them, without them having to touch it. Those were the early days of automated marketing, and I’ve been building on that ever since.

Part 1 – The myths of marketing, and how they came about

How Google really works

Google’s job, is to help you find any information on the web, no matter how arcane.

You want to find a blog about making crochet models of Japanese comic characters? Google will give you a choice of dozens.

It is a simply amazing tool that has democratized information and put it at the fingers of anyone with the resourcefulness to make use of it.

But here’s the kicker.

Google doesn’t create that information. You do.

In order for Google to function, to be of any use at all, when someone asks it a question, it needs someone else to have  answered it.

In this sense it is the most parasitic business on the planet. Making nothing, but profiting from the efforts of others.

So why do we continue to feed it?

Well, if we get it right, and our content appears at the top of Google’s results, for a phrase that a lot of people search for, then we get traffic.

We get clicks to our website and maybe, an opportunity to get a fan, a lead, a buyer, a donor. Whatever the lifeblood of our business is, that’s what we’re after.

Now that logic was good in the early days, especially when competition was lower, when the billions of pages created each day hadn’t quite drowned out our little voice, but there’s something else Google has got really good at in the last few years.

Smelling money.

To google there are two things people are looking for when they search.

1. They want to know something
2. They want to buy something

and Google’s whole model is about serving people who want to know something for free, and who want to buy something, at a profit.

Take a look at some of what Google pushes to the top of its results

Products

Shops

and above all – ads. 

The number of ads on pages looking for any sort of product or service have shot up in the last few years, from 2-3, to as many as 10 in highly competitive industries, pushing all other results down below the “fold” (the bottom of the visible area on a typical laptop screen.

Look for a product, and expensive one like a camera and you’ll see plenty of review sites in the listings – free information.

Change your search to “buy digital camera” and the number of ads shoots up from 2 to 6 (your results may vary).

So, more and more, the traffic from Google is either not free at all – you need to pay for it using their Adwords programme, or you can only get it for terms which don’t relate to buying anything.

I.e. Google has become adept at separating buyers from tyre-kickers and pricing them accordingly. 

Google’s secret army – the SEO industry

So how has this myth endured?

Well, like any myth, it’s usually perpetrated by someone with a vested interest.

Enter the SEO (Search Engine Optimisation) industry.

These are people claiming that by spinning technical wizardry on your website, they can take you to the promised land of a #1 spot on Google.

It’s a game of what I call “cowboys and indians”.

Slick western salesmen, fronting armies of cheap offshore labourers, churning out low quality website content, and creating links from valueless websites.

And the lure is so great, that almost every website owner falls prey to it at some point.

To be fair. At the top of this industry are some great marketers, getting really good returns for their clients, but they are well out of reach for most small businesses.

Typical budgets start at at least $2000 per month, usually involve a lot of website development on top of that, and you won’t start seeing any significant results for around 6 months, let alone paying back your original investment.

$15,000, just to find out if it works for you.

That makes a paid ad campaign look pretty cheap now, don’t you agree?

Facebook – the new prince of traffic

And so we turned to Facebook – the rising star of media.

Brands pumped millions into building up their “fan pages”, only to find that Facebook followed the same pattern and became a pay-to-play model.

Much like Google, Facebook is expert at becoming the go-to destination for people looking for certain types of content.

In Facebook’s case it’s not knowledge, but interpersonal connections, entertainment, and escapism, from whatever it is they were really supposed to be doing before they got there.

Gary Vaynerchuck – a world renowned social media expert – has said [quote about zuckerberg being an expert at arbitrageing attention]

And Facebook knows that if it does nothing but flood your feed with adverts, it will quickly lose that attention, so it also has a strategy based on promoting content which is entertaining, original, distracting form the day-to-day of life, and pushing purely commercial content out of sight.

Unless it’s paid for.

Current estimates are that a post on a business’s Facebook page gets seen by less than 6% of their followers.

Imagine if you only got a 6% open rate on your emails? You’d be horrified.

New tactics tend to get a short burst of attention to get traction and have brands investing in them.

Videos were first, then Live video, and also private groups rather than pages.

But we know, and are resigned to the fact that Facebook is only pushing users to these while we learn our craft, and while Facebookl works out which items keep people on Facebook longest.

And then we’ll have to start paying.

Pens, cameras, action, the rising bar of attention

The internet is a global opportunity, but it also represents global competition.

Where I’d once decide on suppliers by networking and going to trade shows, now I turn to Google and recommendations on social media.

My first agency only had one overseas client. Now over 80% of my clients are people I’ve only met face-to-face over Skype. To win my last client I was competing against other competition in Los Angeles and Germany.

Just deciding not to compete on a global scale and to focus on your market isn’t enough any more. International competition, sometimes operating from much lower cost countries, is getting through to your customers already, through Facebook, Linkedin, email, virtual seminars and webinars, podcasts and many other channels.

The clamour for your prospect’s attention is getting louder, and so the bar is certainly rising on what it takes to get the user’s attention as well.

Where once a snappy blog title would do the job, we have become an increasingly image-literate society.

Gorgeous Instagram filters, the ability to create beautiful inspirational images, and the rapidly falling costs of broadcasting live video. These all help the sense of escapism which Facebook lives and breathes

And we all need to get better at these media.

The media owners of tomorrow will not be huge TV studios. They’ll be travelling twenty-somethings with an iPhone and the ability to shoot and edit video on the fly without a truck of broadcast equipment. We are already seeing that in news, speed beats quality.

In marketing the same is becoming true.

Search actions vs the Facebook feed

Together, Google and Facebook present a virtual duopoly on how we discover new products.

Google, search-driven, uncovers solutions to problems we know we have.

Facebook, driven by deep knowledge of it’s users, uncovers problems we either didn’t know we had, or which weren’t top-of-mind at that particular moment.

They are both powerful forces and great marketers know when and how to use each one effectively.

Working with giants

A lot of people have all but given up on Facebook pages right now after brands spent literally millions on building up likes to their fan pages. The numbers for the number of people seeing posts that they put out has dropped to about 6% of their audience. That is the equivalent of you sending out an email and only 6% of the people even seeing the subject line, never mind actually paying any attention to it.

Word had got out that really fan pages are, you know, you can only get access to those bases of fans by paying for adverts to them. Yet Louise Kang, who brands herself as the High Protein Cook, has a completely different experience. Louise shares food photography and videos on her Facebook page and she makes quite interesting recipes using things like the protein powders that gym fanatics and bodybuilders use in recipes like pancakes and porridge and all sorts of other things. She does gorgeous looking food photography of quite unique recipes, and she puts those on her Facebook page, and they get likes, they get shares, they get enormous numbers of views. Now, when Louise came out with her recipe book, which is what this was all being photographed for, she could put a couple of posts up on that, and that would get liked and shared by the same people. She would get people often going and searching in Amazon and wherever else she was selling it and did fantastically well on all that. 

Now, what this points to is how Louise has figured out what it is that Facebook wants. Things that work for Facebook, they will get behind. What Facebook wants is interesting, attention grabbing content that will keep people on Facebook. If your strategy has been to repost links to your YouTube videos, post links to your blog, your Facebook strategy has all been about trying to get people off of Facebook onto your website, that doesn’t work for Facebook at all. Facebook will not be giving you free traffic for things that don’t work in its own interest. If you want to take people out of the Facebook environment and put them into your environment, maybe get them onto your email list, you’re going to have to pay for it. 

You can build up that audience and get people to effectively put their hand up as being interested in you by putting out content that Facebook does like. Interesting, engaging, entertaining videos. The recipe that Louise has found, which is more valuable than the recipe for her foods, is to put out things which get shared. That way it gets spread amongst the Facebook community, Facebook can see the stuff being shared about, can tell it’s interesting. They can tell it’s grabbing people’s attention, and they will push that out to more and more and more people. Okay? The friends of friends of people will see it. Her recipe is to find things that make people look good when they share them. She puts interesting recipes out, people share them, and that says, “Look, I’m into this stuff, and I’m cool because I found it.” 

By doing that, she’s creating content which Facebook benefits from, people spend more time on Facebook, more time in their feed, get more addicted to the Facebook feed. Then when she wants to sell, she can get a certain amount of that audience off of Facebook, as long as she doesn’t overdo it, to Amazon or to her website to build up a email list, and it works in her favour. She gets way, way more than that 6% number, and it’s all about working with Facebook on the things that benefit Facebook. 

The same thing is true for Google. Google works slightly differently in that Google wants to get you off of Google and onto other content. Google survives because it has found content which meets the need that you have when you search for things. Google is a media owner, just like Facebook is. If you’re driving somebody to information type content, so in Louise’s case how to cook high protein pancakes, then Google will reward that. They will reward those informational searches. Free content given away on pages which are a good user experiences and which don’t just try and suck people into landing pages purely to sell or get them to sign up to emails, are what it rewards. As soon as you start overtly pushing things that are going to move them onto your email list, Google doesn’t like that. Google does not like good content hidden behind pay walls, hidden behind opt ins. 

Now, that doesn’t work very well if your business is selling content, but you can push a certain amount out of it and have a relatively lighter call to action. You can pixel your audiences. That means you can flag them up to Google and Facebook, so that when they go back they will see your advertising. You can build those audiences of very, very targeted people by giving Google what it wants, which is free information. 

Rather than doing well off of SEO businesses and Facebook gurus talk about, which is trying to crack the code, trying to work a way around the algorithms that these guys use to decide what content gets shown and what brands get exposure, don’t do that. Figure out what drives those businesses. Figure out what drives Google’s business, which is giving people free content and then paying them for content which leads to a purchase. Facebook’s is all about having entertaining and attention grabbing content that will keep people within Facebook. Create the kind of content that those platforms like, that benefit them, and you will work far better by working in sync with them rather than trying to crack their code or somehow game the system. 

Not all traffic is created equal

So, hopefully by now you’ve seen that not all traffic is created equal.

In fact Google’s rules for the pages it will give “free” traffic to are making it harder and harder to convert that traffic into leads and sales.

In a world of global competition for our attention, we need to be laser focussed on our potential prospect, understand what they particular pain is, and how we can solve it, and be single-minded in continuing that message throughout our marketing, from first contact to sale and beyond.

Above all we need to move our prospect from a channel that neither of us controls, into one where we can both proceed at our own pace.

Watch, don’t ask

Until late 2006, I used to run an online loyalty scheme called Ipoints, so if you’re familiar with things like Nectar in the UK it was similar to that but with working just with online businesses, so you’d shop at these people and for every pound spent you’d earn points that you could swap for Amazon vouchers and things like that. We had a very wide spread of partners, so we had some retailers, we had some research businesses, and we had some people in gaming, so anything from poker and bingo and slot machines, things like that. They were very, very lucrative crop clients that used to pay us quite a lot of money for getting them new members. We were known for giving a bit of extra kickback on new members that signed up so we had some quite high rollers that used to come through us.

Now when somebody signed up or Ipoints we started off by asking them a survey that had 15, 20 questions. It was quite long but they got given some points for it and it was almost enough to earn their first reward off that, so it was quite popular filling it out. We would ask people what kind of emails the wanted to get. Did they want to get them about shopping, about fashion, about electronics, music, DVDs. All the different partner types that we had and one of those was all about gaming and gambling. Were they interested in getting those kind of emails? Really hardly anybody ever said yes on those, less than 5%, and so we would segment up the database and pull people in and out based on what they said they would do.

Now after a while we were struggling to find new members for these gaming things but we knew that once somebody had done one of these offers they would do lots of them because they were so lucrative and I don’t think that people realised that, so we started taking a slightly different approach, and we would send out two or three emails when somebody first joined the programme which would tell things like how to get points for free by doing surveys and things, what the top retailers were that you could get points at, so people like Amazon and John Lewis and other big, well-known retailers in the UK and then we had what we call the high points email, which was how to get the maximum number of points quickly, and that included quite high ticket products, so things like televisions and hi-fis and washing machines and things like that and some finance products that had quite a big reward on them, but also some of the gambling clients, so we had a bingo one in there, a poker one, and a couple of other clients as well.

We would send these out and we would ignore … Everybody would get these and we would ignore the results of the survey until all of their stuff came in, so this pushed up our numbers quite a lot, so we had a lot of people that suddenly started doing the gaming and gambling offers because they realised that there were quite big introductory bonuses on these things and they were quite good fun and most of the time you would get given back almost the same amount as your stake in bonus, so you were evens going in and you might win something so it was a no-brainer for people who were reasonably disciplined who would just play their bonuses and then walk away from it. Some would carry on and be long-term players of these guys, so the people we were dealing with were quite happy with us.

Now after we’d been running this for a couple of months, and we had a lot of data going through, I used to acquire about 50,000 new members into the database each month through a variety of advertising campaigns, and we looked at the people who had actually done the gaming and gambling offers and over 90% of the people who had done those offers had said in the original survey only a day or two before that they were not interested in that kind of offer, so we had, by listening to our customers, been reducing the number of people who could potentially take those offers up by about 90%, by only 10% of the people we were hitting with those.

I think a lot of this stems back to a misunderstanding of what’s meant by permission marketing in a lot of cases and the idea that you can ask your customers to look into their own future, which just does not happen. If you asked people what they wanted in life, we would never get any innovative products. We would never have had the iPod, which led to the iPhone and all those other fantastic products, fantastic breakthroughs. People just cannot see those in the future. They cannot see what they haven’t experienced already. Sure, survey your customers, but ask them about things they have done recently. Hard facts, where they are now. Age, gender, income, all those things. Hard facts about now, and have you bought, or have you done this, that, or the other in the last three months. Absolute tops 12 months.

That’s the kind of stuff you should be asking about. The rest you should be testing and watching, because people will say that they don’t do things when actually they do. If we ask anybody, “Oh, do you click on those pop-ups that come up on website?” “Absolutely not!” is their response, and yet that’s one of the best-converting routes that we have for getting new customers onto a list. When we talk to clients about it, they always turn their noses up until we’ve run a test and then they totally change their opinions, because their opinions about what is right and what people actually do are miles apart. We’ve seen this so often recently in government elections around the world, where people will say that they’re voting for left wing and liberal parties and then they vote with their wallets and vote for the more right wing parties that are going to give them the bigger tax breaks.

People either lie about what they’re doing because they want to impress you or they just simply don’t know what they’re going to want to do in the future, so the answer is watch. Our emails that we sent out, we watched what people clicked on, we watched what kind of offers people took up, were a far, far better predictor of what was going to happen in the future than that survey asking them what they wanted ever was. 10 times more people we got into this very lucrative niche by just offering it up and seeing who responded, so that’s my tip. Be very careful about what you ask customers and be very vigilant in watching them at every opportunity.

Summary – The 7 Traffic Myths

opposites of

Product led	products for markets
Data for later	products that get results
the next big thing	being everywhere (but only where they are)
relying on SEO	working towards paid
The only X you’ll ever need	having follow-up products
turning vanity metrics into sales	tracking long term numbers
“that didn’t work”	testing

Part 2 – What the experts know

Market knowledge

Creating Products for markets

Undoubtedly the biggest difference between successful digital markets and those who are struggling is their approach to coming up with product ideas.

We all have ideas for products, things that would make our lives better, things that are “cool”, things we can’t believe that noone has thought of before.

We get giddy with excitement at the process of creation, of designing and crafting our product, branding it, building websites to promote it, and then we burst into tears when, on launch day, noone shows up to buy.

With our bank accounts emptied with the expense of the product creation, we then spnd years scartching around trying to find people who want what we have. Even the best products suffer at this stage as the salesman’s voice cracks with the tone of desparation. And noone buys out of sympath except a few close friends & family.

Successful marketers take an entirely different approach.

Finding products for markets

Let me introduce Gary. Gary is an old client of mine. He runs a business that sells t-shirts and hoodies and clothing that’s all based around vintage cars and motorbikes. He’s super passionate about this stuff. He’s got this amazing, old 1960’s bike out at his back garden. Loves all this. He’s got posters all over the walls of these things. He’s a great artist and illustrator himself. He’s actually a catalogue designer by trade, which is how I came across him in my direct mail days.

I helped Gary to create his e-commerce site and [inaudible 00:00:49] the email marketing for this product. We launched the site, and the site featured a bunch of quite rare vintage bikes and illustrations of those. There was one that was ridden by Sir Lawrence of Arabia, all kinds of interesting stories behind these things. It really struggled to start with, and Gary couldn’t really work out why. Sales weren’t good. He’d spent a lot of money on obviously getting the site and the marketing together, but also spending a lot of money on stock which wasn’t moving at all. He was scratching his head about what he should do about this.

Now, I’d worked with a sort of competitor of theirs, somebody who also sells car related memorabilia, models, posters, things like that. I knew that they were selling stuff related to a lot more mass market product, so things like Volkswagen Beetles and the original Golf GTI, which was a brilliant first car that people of my generation would have lusted after and probably owned once they’d earned a little bit of money.

Gary sat down and he created a short run of products that were based around Volkswagen campervans and the Volkswagen Beetle. He did that because there’s a big Volkswagen exhibition and rally just up the road from us. There’s a big racecourse that gets taken over for about three days, and it’s full of weird and wonderful customised campervans and Beetles and there’s a traffic jam three miles long of VW Beetles throbbing away, queuing up to get into this thing over the whole weekend. Gary created these products, had a few printed up, sent them along to his stands and he pretty much sold out of it. On top of that we set him up with a little iPad so he could capture email addresses of people that maybe weren’t ready to buy, didn’t have them in their size, he could run these things out. Made a huge lift in his email database.

Despite the financial success of this, Gary’s a little bit disheartened because VWs weren’t his passion. His passion was really the Triumph motorbikes and things like that, which was what he’d originally set out wanting to celebrate with this brand, but he plugged away at it and little by little realised that that wasn’t necessarily where the money was, that motorbikes, and vintage ones in particular, are a much more niche product than cars. He slowly came round to realising that what he’d actually managed to do was to step into an existing marketplace, so that VW rally was a really big deal. Thousands of super keen buyers and owners of a particular product, who would … Their homes would be full of Volkswagen memorabilia, and Gary could just step into that stream of traffic at that show. Then subsequently, he found magazines, other events, and those are really what was driving his business.

I’ve seen this so many times with people creating products around their passions. It’s really, really important that you don’t fall in love with your product and what you do fall in love with is the customer. That you find a big enough segment of customers with a common value that you can get in front of. That was the critical bit, that one day at that rally really turned his business around, because he managed to get in front of thousands of enthusiasts for that product on a single day when they were there. A lot of them expecting to spend a bit of money indulging in their passion, and buying the-shirts and clothing is a great way to show off that they’re a fan of the product.

The idea that you should find a market and create a product for it is infinitely more successful than ploughing all your energy into a product which you might be passionate about, but which you are going to struggle to find a market for. To sum that up: find products for hungry markets, not building products and then trying to find a market for them.

Sell what they want, serve with what they need

People are, by their very nature, by human nature, impatient. They want results quickly, and with the bare minimum of effort, which is why training programmes like weight loss programmes, like P90X are so appealing because as promised getting fit in the least number of days and the least amount of time spent exercising in those days. I

n fact, they’re very painful if you do them properly. 

People overlook that. They just see the bodies of the people who have gained fantastic results from the the programmes. They hear how many days it took them, and they want it. The sad fact is that in order to have the conversation about what people should be doing, the conversation about long term changes in their nutrition and exercise, you’ll never get to have that conversation if that’s the first thing you open with. 

People don’t want to hear it. You need to get them some results before they’ll actually listen to you.

However good a teacher you are, most people won’t pay a blind bit of attention to what they hear until they have a chance to experience it for themselves.

Our job therefore becomes a bit like a parent, creating a scenario where they can “fail” in a non-critical way before heading out in to the big wide world.

The best clients are ones who have tried and failed to do things themselves, realised it’s not that easy and come back for expert help.

I came across the same instance in the marketing world. In online marketing, people are absolutely obsessed with the choice of tool, before they even have a product available. It’s quite scary how difficult it is to have a conversation with somebody about what campaign they should be building before you’ve [inaudible 00:01:42] what tool you should use. Of course, the tool [inaudible 00:01:45]. I tripped up on this when I created one of my first online courses called the Foundation Funnel. Which is a fairly quick and easy strategy about putting together [inaudible 00:01:59], and selling a digital product. To be honest, when it first launched it did not do well at all. I found it really hard to approach sales, people just weren’t interested in the strategy. They wanted to know all about tools.
Then sort of by luck, I came across a software tool called [Mortech 00:02:24]. [Mortech 00:02:27] a free open source email marketing tool that helps you build out a lot of the things that you can do in the Foundation Funnel course. I made a quick training course of how you build this thing out, literally over the shoulder watching me build up 90 pages of emails, using this tool [Mortech 00:02:51]. So it appealed to a wide audience because it’s free software, and it got people a result very quickly. They had a set of amount of pages, they’ll have the email to follow up. What they built from the copy, the design wasn’t necessarily that great, but they had a result. Then people that had bought that course and followed it through, based on traffic, realised that their [inaudible 00:03:21]. Realised that that funnel wasn’t amazing and needed to understand a little bit more behind the strategy to get these things to convert to hit the kind of figure that I’d been talking about getting in my course.
I had a lot of those people come back and purchase the Foundation Funnel to understand some of the theory and strategy behind it, to the extent where I was selling the [Mortech 00:03:51] Masterclass, which is all about the tool, very heavily discounted rate because the people that came in from that would then buy the much higher-priced complete course. Some of those then came on to become clients, but it wasn’t until I had the conversation about what people wanted, which was the tools, that I could have the conversation about what they needed, which was the strategy and the deeper understanding about how conversion really works.

Finding willing buyers

Finding a river to drink from

Product creation

Before you start

Pain > promise product

As you go through the research steps and start to get ideas for product you could create to solve your prospect’s pain, there is an enormous temptation to dive in and start building something right away.

It’s entirely natural. You’ve seen someone with a problem, you care about your market, so you want to get as fast as possible to helping them.

But take a moment here  to make sure what you’re about to create is going to be both appealing and genuinely useful and usable for your market.

Is the product format right for them? Different people are served by books, videos or 1:1 coaching. What is your market’s preference?

Are you using the exact right language? Tiny changes in the phrasing of your offer can have a massive difference in results.

Is the price point right? Too high and your market may not afford it, but conversely, too low and they won’t be spurred into using it and getting the result they need. Pricing needs to cause just enough pain to spur action.

So, have your big goal in mind. Know where you want to take your client in the ultimate version of your product, with every layer of help and support you can give them for the most complete result.

But under no circumstances try to build this product before you start testing real market interest.

Your research so far should give you the best possible chance of meeting your market’s needs, but like Mike Tyson once said.

“Everyone has a plan until they get punched in the face.”

There is no substitute for meeting your market head on, and no truer feedback than sales to see if your product is a good idea.

So how do we balance the two?

Plan from the back, execute from the front.

Look at it like this. Every contact with your customer needs to deliver value to them, and in return there will be a transaction.

That’s not always a financial transaction though.

In today’s market, with every inch of physical space covered in billboards, and every pixel of each web page built to accommodate more advertising, there is one commodity that your prospect has that is more valuable than anything else they can give you.

Their attention.

In the late 80’s when I first started to study marketing, we were taught an acronym about how to move prospects to become buyers – AIDA

Awareness

Interest

Desire 

Action

Writing this, 25 and some years later, that first A for awareness is of no interest except to a handful of truly mass market products like fizzy drinks or washing powers.

These product take no commitment on the part of the customer to get a result.

They are bought without thought, and consumed without effort.

That’s not the case with most digital products. They take time to consume and continued use to get the result they offer. That takes effort.

The A for awareness has now changed to A for Attention.

Our first step is to get attention this means advertising, video, or shared content that is interesting enough to stop our prospects from whatever they are doing (usually scrolling mindlessly through their facebook feed), and pay attention just long enough to hear what we have to offer.

We might get their attention through shock, curiosity, humour, whatever suits your brand, but we have to get it.

[ note on pattern interrupts]

Once we get it, we need to hold it. We need to recognise their attention has a value and reward them for it.

We need to give some value.

Now the word value is bandied about by marketers with no real explanation, and a lot of experts take it to mean “teaching”. They give away the farm too quickly and train their users to consume their free material which, as it has taken almost no commitment from them is never acted on.

The best balance of value at this stage is to give enough to help their understanding of their problem, without presenting our unique solution in full.

Help their understanding. Still too vague?

An “A-Ha!” moment.

This going to be tough but very very effective.

You need to put yourself back in their shoes, when you were as confused and misled as they are right now. That’s a really hard thing for an expert of maybe a few decades of experience to do, but it’s essential.

What was the moment when the penny dropped for you?

The moment when you realised that the way you’d been doing things before was all wrong?

You’ll probably find there were a few of them. Your experience is a jigsaw of little truths you’ve uncovered throughout your career. There are probably some exciting stories of wild successes and dramatic failures that surround them.

Let me give you an example. 

My first job was for a company that sold English Language Teaching products to schools worldwide.

In the mid 90’s they released a truly exceptional CD-Rom product that combined their encyclopedia with audio, video and images to give a really immersive way to support your learning of the English Language.

But I’m ever the cynic, and amongst everyones excitement about the product I foresaw a problem. In those days a multimedia computer – one with a CD-ROM drive, speakers and a colour screen, cost about £2,000. That’s close to £4,000 in today’s money.

And I didn’t know many schools who had that sort of money.

I’d had to twist my boss’s arm quite hard just to get a couple more in the marketing department.

So I put a little card in the product to get some feedback on who was buying the product.

I remember the very first email address I ever collected. It was from a technical sales manager at IBM in Sao Paulo, Brazil. Not a school.

Over the first few weeks I collected about 25  of these cards, and they were nearly all form businessmen in technical industries like IT or engineering, trying to speak better English for their jobs.

Right there the penny dropped about just how wrong you could judge the BEST audience for your product. Sure, we sold a few to schools, but businessmen trying to close 7 and 8 figure IT deals would do anything to make sure their English was better. It could make or break their careers.

This story led to my first ever email campaign, where I had a few more A-Ha moments, but more of that later.

So your first contact with your customer needs to be attention grabbing and deliver value in the form of a lesson, maybe a little entertainment also.

This needs to be freely given. No opt-ins, demands for email addresses or other data at this stage.

For that we need a second layer of content, one that needs a little more commitment from them, but also gives yet more value from your end.

The pillar product. [needs a name]

The pillar product does one thing – it demands sufficient attention from your prospect that they can see the differences between you and the rest of your market.

Anything from an hour to a day, it depends on what you are selling as to how much you need to invest in this product.

That’s right – invest. 

Whilst we call this a product, it may not even be for sale, or if it is the money is only there to guarantee attention.

If I ever make any profit from these products I plough it straight back into advertising budgets to grow the business. It’s a product, but it’s a marketing effort.

After all, if your prospects are willing to pay for your marketing, they are definitely going to be prepared to pay for your core product.

Some examples of a pillar product might be a webinar (make sure you don’t just sell, it’s a an online seminar, not a sales meeting), a book (like this one), a workshop, or even a full day conference.

These all do the same thing.

They give you opportunities to 

1. Show your capability in solving their problem
2. Demonstrate your authority in this area and how your method has got results for others
3. Show distinctions between your methods and those of others they may have come across in trying to solve their problem.

A blend of teaching, with stories about other clients who have followed your path and had successes is an excellent mix for this product.

[Justin Devonshire quote about content being used for authority – also Debbie Owens (Todd’s content person)]

Testing the core product

So, you have some up-front content to use in social media channels, and that you can maybe push with a small advertising budget.

That leads into a small commitment product like a webinar, or short workshop, where you give some more learnings, and maybe solve part of their problem, but in a way that certainly doesn’t take any hands on time from you.

Next is to present your core solution.

You’ve not built this yet. But you’ll have your plan for what will be there.

Your aim right now is to get feedback and judge interest. You can get feedback in two places. Before and an after they receive your pillar product.

The pillar product takes time to consume so it’s unlikely that will happen soon as they buy.

That leaves them hanging for a moment, so take this moment to ask where they are at right now, what they might have tried as a solution already (this is a great question to find seriously frustrated prospects) and what they feel is getting in the way of them achieving the resulst they want.

I put questions like this on the confirmation pages of all my webinars and workshop bookings. It’s some of the best feedback I ever get that I can use in copy and to improve my products. I usually get about a third of the people who sign up to a webinar giving me feedback of some sort.

Presenting your core offer for the first time.

This stage usually presents some ethical dilemas for many people which I’m going to help you through.

A fair few marketers I know will actually try to sell a product that doesn’t exist at this stage, then rush madly to create it if demand is enough, or simply refund if it isn’t.

I’m not a big fan of this. The let-down of your best early customers is just too big a waste, and if I’m selling a product at £1,000 or even much more, I don’t just want it to be good enough. I want it to be world class. And that takes time.

Instead, what I’ll present is an abbreviated contents of the product, with the main features it will cover and its benefits.

I’ll present the price up-front, I don’t want to waste time on people who are going to get sticker shock further down the line.

Then, quite honestly, I’ll let the first audience know that as it’s the first round of the product I’m going to be giving an exceptional level of support to the first round of buyers to guarantee they get the result they’re looking for. 

This means that I have to have people who are going to take action, as without their results I can’t grow the programme and help others.

I then give a substantial discount from the normal price in return for a promise from them – that they’ll give me one of two things

either a five star review and testimonial, or, if they don’t think it’s worth five stars, that they tell me exactly what I would have had to do to give that kind of feedback and give me one chance to do that before I refund the full amount.

Because of the limitations on my time I ask people to apply to be in the first round.

No money changes hands, but the application reiterates the promises on BOTH sides, and gives me more detailed feedback on who the are and where they are on the journey I’m trying to take them on.

This will buy a little time, and if I’m rejecting people I can do it with grace, saying they are too far ahead or behind the level I’m aiming the course at and they wouldn’t get value from it.

From here you absolutely have enough feedback to know if your product is likely to be a success or not, and to start building it.

This is mostly esigned for educational products like video or coaching courses, but it will work with software too.

It’s very much like the “crowdfunding” model established by firms like Indiegogo and Kickstarter for physical products. Show a rough prototype and get commitment upfront, rewarding earlt adopters. If there’s no interest, peopel are refunded and it simply doesn’t go ahead. 

No, deceit, the numbers are there for everyone to see, so if it doesn’t go ahead it’s seen as the fault of “the market”, not the business.

Market sophistication

Market sophistication is a concept that was developed by Claude Hopkins in his book “Breakthrough advertising”. It’s a concept that has gained a huge amount of attention as with the evolution of the internet, and social media in particular, the market has become much more knowledgeable, often more so than the salesmen who until the last decade, held all the power in the relationship.

[description of the levels]

The unique delivery method

In a sophisticated market, how the result is delivered becomes a crucial differentiator.

We’ve already soaked up new media like online video courses and apps, so now we need to take this even further. 

If you had to win a baking contest, what would you be most likely to do.

1. Find an entirely new ingredient that noone had used in food before?
2. Mix in ingredients that people knew, but hadn’t seen in that combination before.

Heston Blumethal made a worldwide name for himself with Snail Porridge at his Michelin starred restaurant.

We know the French started the idea of eating snails, we know porridge, but together?!

The highly sophisticated market that dines regularly at Michelin Star restaurants want, even demand innovations like these, so it was a brilliant move.

Another way if to simply go back to products being sold to your market 30 years ago and see if they can be revitalised.

Ben settle – a copywriter who is famed for his email copywriting – his core product, selling on subscription at $97 a month, is a printed newsletter.

In a market where the product is being served by online video, apps and high tech products, he has gone “old-school” and within his market that method is unique.

Following formats

In 2006 I started a digital marketing agency, and in it’s early days I drummed up a lot of business from local companies by going to networking events. 

I live near London so there’s no shortage of these.

I noticed that the clients I met at these were incredibly demanding of face to face time. They’d want meetings where a phone call would have done the job. They never touched the training videos we’d make them or read the documentation on how to run their websites.

I started to notice that people I’d met in other ways, particularly ones from outside London, were far happier to work by email, phone, skype or other ways that allowed us to be much more effective.

People who had been sold to by phone, wanted support by phone, people who had found us online and filled in our enquiry forms or sent an email, were happy to get email support.

People have their own preferred media for dealing with other businesses.

The same goes for the products they buy.

I’ve probably bought more video-based training via webinars than any other medium.

I know marketers that still sell printed courses, sent by post.  They sell them by direct mail or via inserts in subscription magazines.

Whilst you can vary the delivery method of your product, make sure your selling matches the way the core of the product is delivered. It will be far more successful if you let people operate in its preferred medium.

Putting your customer in control

I’ve had some interesting conversations with very confident sales people. Marketing and leads, marketing and sales quite often clash. Sales people criticising the marketing guys for providing them with leads that aren’t more qualified, and the marketing guys criticising the sales guys. They’re saying that they can’t close the leads that they’re providing, and one of the things I hear the sales guy say is “No point getting me email addresses, but get me phone numbers. Because when I can get them on the phone, When I get them on the phone, I close nearly all of them.” And it takes a long time for us to demonstrate how the world really works, which is that, when somebody is ready to buy, that is the point when they will call you or when they will answer the for you. It’s really not the same thing.
So,if you ask for phone numbers at the same time you’re trying to build their email list, it will dramatically reduce the number of people who come into your [inaudible 00:01:35]. So, the people that the sales guys describe as tyre kickers, which are merely early stage leads who aren’t committed to making a purchase yet. Those people will not give you their phone number. They will give you fake phone numbers or they will turn away. They do not want to have a conversation with a sales person at that point. They are gathering information. They feel, they feel weak in that conversation. They feel nervous. They don’t feel like they are in control. They don’t want to talk to you until they have done some research of their own and they feel a bit more confident about their options.
So every single time that I hear somebody saying something on the lines of “What we want our customers to do is X.” I know we are going to have problems. We have to turn that conversation around to what this [inaudible 00:02:37] customer wants to do at that point and how to [inaudible 00:02:44] some of them.
You can turn tyre kickers into buyers by serving them with what they want, which is information that will help them make a buying decision. I had a light bulb moment talking to a very successful sales person who had worked with Unilever or a huge FMCG company and she said that the way that she turned great marketers into great sales people was just to see them as that.
Sales is just a process of educating your prospect you are the right choice to fulfil whatever solution their after. You teach people around your way of thinking. So this is what we do, we help to provide the prospects information about how to make a good choice. What makes the difference between cheap supplier and premium supplier. What you’re missing out on. The kind of questions you should be asking.
We get around their side of the table. We get on their side. We talk about how to spot poor suppliers. We talk about the differences. We talk about why we’re special. We talk about why we charge so much more than our competitors do and how you benefit from that in the long term and we get better customers as a result of it. Because people who are just shopping on price we’ll never win that conversation anyway. By the time people come to us they already know why we charge what we do and so they are comfortable paying it. Can’t say happy. Nobody is really happy paying high prices. But at least comfortable and they realise they are going to get [inaudible 00:04:34].
But we couldn’t have those conversations. Those sales conversations. Without first educating people why they need us. What the alternatives are. Which is a risky strategy sometimes, because they might take those and why we’re the best. So we’re happy if we educate them that another choice exist, if they take that it’s a better choice for them. We’ve actually done them right and at the time that they need a more premium supplier they’ll come back to us and, you know we’re honest about it. We don’t bend those discussions around for our benefit. We do it to find the better matching customers.
I have a great set of clients. I have clients that I enjoy working with. Who have the money to pay the fees that I demand. Who can afford to do that, have the right size of business. Get well with them. That’s similar value for me. Stayed at some of their houses. That comes from being honest. Having a conversation with the customer about our marketing and letting the right ones come to us. Letting the right ones come to us.
So we don’t ask for phone numbers from our client teller. We give them the opportunity to call us when they’re ready to do it. And they bring us out ready to buy. We don’t have sales guys. Just have people who can talk to them about whatever we like to work with, so we, they talk directly to one of [inaudible 00:06:15], so we separated that role out, someone who is good at manipulating. What we’ve done is giving our customers the tools to put them in control.
We’ve taught them that they are not going to constantly be put on the back burner waiting for some kind of trickery while we wheedle more money out of them. We’ll work for their best interest and provide them value and we expect to take a chunk of that value back for our own business in return. Not a greedy amount, not a tiny amount. But an amount that they’re quite happy to pay at the end of each month. We put the customer in control and we appreciate and we have understood that customer does not get involved in the sales conversation until they’re ready to.
Not trying to push them into calls. Push them into strategy calls which everybody knows is just another word for sale pitch these days. It’s just going to leave a bad taste in their mouth. We don’t like clients arriving with a bad taste in their mouth the first day of working with us.
Let your customer in the driving seat. Try and point them in the right direction for them and it will be a lot easier.

Building your customer into the product

It goes without saying that your customer is an incredibly important part of your business, but they are more than just a source of revenue, they become part of the product itself.

Their feedback drives the product itself, their success becomes the foundation for the the product’s success, but how about if they became part of the service itself?

It’s no secret that the biggest frustration or people selling any sort of education or instruction is that a huge percentage of people simply don’t put the new learning into practice.

It’s a huge problem. And not just for the customer.

Fewer people taking action means fewer success stories, means a harder job convincing others that the product works well.

So the unique delivery method for many of the best products includes the customers themselves.

Most university courses include elements of group work. They understand that the peer pressure to not let others down drives up the quality of work across the board, and that groups will put in much of the extra work needed to pull the weaker members up to their level.

Online this is harder to achieve, but there are a few innovative courses doing it.

Derk Johanssen’s “Copy hour” course is a quite demanidng product, getting you to write out and analyse top-performing sales letters, video scripts and other copy for an hour every day for 60 days.

One elemnt of this is the Coach.me app, a mobile app where you just check in each time you’ve done your daily task. After a few days you want to keep going to avoid breaking your “streak” of successes. It’s a great tool to try if you’re trying to build a new habit.

What I didn’t expect though was the number of other members in the group liking my check ins, asking questions and giving support.

A truly engaged audience will start to take some fo the support burden off you.

A more recent trend is setting up private Facebook groups to provide support alongside education product or even amongst software tools.

Seeing the way more advanced users are getting results fomr the tools is a great motivator to stick with it through early frustrations, and as soon as you join you can see whether the tone of the group towards the business is a positive or negative one.

The value of the network effect

The effect of this shouldn’t be underestimated.

The “network effect” where a product becomes more useful the more people that use it is one of the criteria that venture capitalists use when they are looking for the next big thing.

Being the one person with a phone, a fax machine, or the first person on Facebook is little use. But add a few thousand people to any of these systems and they become embedded in their users lives and they start to actively recruit other people for you.

Media Buying

The value of paying to play

A while back I was called in to a consultancy who were concerned that their website wasn’t doing a good job of pulling in leads.

The site was managing to persuade less than one in every hundred visitors into an email subscriber, despite having quite healthy traffic each month.

When we dug into the numbers, I found that just one blog post, about video marketing,  was massively distorting the numbers, getting thousands of views each month, but almost no email sign-ups.

I asked the owners if they had any good follow-on material that could lead someone from the blog post towards their core service.

“Not really”, they answered, “we don’t do video marketing for our customers. We just wrote that because it was topical at the time. We got picked up by a couple of other sites and now we get ranked well on that one phrase in Google.”

We sat down and looked at the rest of the site’s data and without this one page they weren’t doing too badly.

We found one other blog post about using LinkedIn which was much better at converting visitors into email subscribers and confirmed that they had, after all, won some quite valuable business from two clients who had first come into contact with them here.

I asked them why they hadn’t been willing to pay for traffic to this particular page when it was doing so well for them.

“Well we’d looked at the typical cost of getting a visitor to the site, and converting less than 1% we couldn’t make the campaign work.”

With the knowledge about what can be achieved by paying for very specific prospects to visit very specific content, the business is now running a small, but very effective online advertising campaign, of which the LinkedIn blog post is an important part.

They’d fallen into a trap that many businesses like them have done, and will continue to do – spending time on unpredictable traffic, when they could be spending money on predictable traffic.

The owned audience

From the point of view of how much control you have over your message there are three important types of media – Paid, earned and owned.

They are defined by two variables. How much they cost to get your message to your prospect, and how much control you have over that message.

Paid media

This is the world of “traditional advertising”. You have total control over the message you give out (within the boundaries of legality of course), you decide what is said, to whom, and when. But you pay for the privilege.

Owned media

This is the world of in-house mailing lists, email lists and CRM contacts.

Again, you decide what the message is, who gets it, and when. The costs are typically much lower here, although there is always some overhead in running an email system, a telesales team or in sending direct mail, the cost are much lower as there are people who have, hopefully, already expressed an interest in hearing from you.

Your social media contacts are also a form of owned media, although this is becoming a grey area. many businesses spent the late 2000’s building up social media followers on Facebook and Twitter, only to find that less than 10% of these ever see the posts they put out now and that they are increasingly having to turn to paid advertising to guarantee reaching these audiences.

To my mind, social media audiences are not so much owned as ‘rented’ and a databalse of email or postal adddesses is far more stable in that respect.

Earned media

Trading places

Poaching from the competition

100 starving fans

Their product ecosystem

The first question – “What’s next?”

where most businesses fail at the first hurdle – the first sale is to create a customer, not to create profit

“Do you want a Big Mac with your fries?”

One of the most profitable phrases in marketing is “Would you like fries with that?”

Seriously, this one tiny add-on has the capacity to more than double your profits.

Let’s take a quick look at the maths.

[maths about profit on the fries]

When most small businesses look at their profits, they look at the transaction, not the customer. But when you start with teh cost of getting your customer to make their first purchase, and then the likelihood that that customer will buy from you again, an entrirely different picture appears.

The profits on that second purchase are way out of proportion to the profits on the the first purchase.

In fact some businesses are so aware of this that they are happy to operate as a loss on the first sale, knowing that the custmomer will return again and again at a profit.

I learned the power of this many years ago when I was helping The Saville Row Shirt Company with their online marketing.

Jeffrey Doltis, the owner, had built the company mainly from press advertising in men’s magazines and the Sunday supplements of UK newspapers, and I was keen to know how our results compared to his “offline” efforts.

“Well, a typical print ad makes us about an 80% return.” Jeffrey told me.

“Wow, so one of these ads at £3,000 will make about £5400 in sales?”
I was impressed – at the time that profit was a good monthly salary.

“No”, he corrected me, “It makes about £2,400 in sales. That’s what I mean by an 80% return, not a 180% return.”

I looked at him, confused at why anyone would carry on placing adverts that consistently lost him money.

“But…”

and here comes the lesson…

“Half those customers come back within a year, and the ones that do, typically buy 4 shirts in the next year.” 

This was more like it. 

Understanding those figures meant Jeffrey was turning a £600 loss into more than £4800 extra sales each year, whilst more short sighted competition completely overlooked the same media as “loss making”.

And that wasn’t the end of it. Most of these repeat purchases were at full price, not the “3 for the price of 2” offers he ran in the adverts, and I’d seen plenty records in his database of customers who had been buying a half dozen shirst form him each year for over a decade.

As long as Jeffery knew his numbers, he could just keep going to the bank to finance that £600 loss for a few months, and would turn it into a very health return.

This approahc needs deep pockets or a sympathetic bank manager until the second sale happens, but as you learn the numbers in your business it ensures great stability and the ability to out-spend competitors who need to make a profit on every transaction.

Know your numbers, and invest in loyalty.

From Air-freshener to Rolls-Royce

There is some argument about the order in which the sales are made.

Talk to a tailor and he won’t try to sell you a belt, then a suit. A car dealer won’t sell you an air freshener, then a car. 

But they are somewhat missing the point.

The process is to fulfil a need, then to carry on serving that need, or whatever immediately follows it.

For example, lots of people I talk to about automating their marketing get hung up on the technology they are going to use, often even before they have the product in place. It’s a relatively simple problem for me to solve, I just show them the “toollkit” I use on both small projects, and which I’ve used to grown client product sales to over $1million a year.

The Foundation Funnel Toolkit is a free piece of content that shows what tools to get started with.

The Foundation Funnel is a very cheap course that shows, click-by-click and how they fit together to created an automated system.

Problem solved. But now they have other problem, they have an email tool and they’re ready to start collecting emails, but when the first email lead comes in, the effort of creating a newsletter for one person is too much. So then I show them how to create a welcome series of emails that EVERY customer will get.

Set it and forget it, 5 emails.

The next problem might be getting more traffic, or converting more of the leads they are getting and I have products for those also.

 So why not sell an all-singing all-dancing course that covers all these things?

Well, for an individual like myslef, many of my new email subscribers had never heard of me before that day, so I need  to build up trust.

Baby steps. Prove I can get them the result they want, then move on.

If you’re Rolls Royce or a Saville Row tailor, you don’t need to worry about that. hundreds of years of tradition and millions of customers have gone before you, creating that trust and reputation, but I need to start from – relatively speaking – ground zero.

Trying to sell a course which would   probably cost $1,000 or more is a big ask, never mind asking them to make the commitment in time that they’d have to do to get the “full” result.

Especially when in their minds they “just need an email system”.

Taking 15 minutes to watch a valuable video series is a fair start on both sides, then $47 to solve the next problem isn’t too big a jump.

By the time a customer has gone through 2-4 products, they know I’m the real deal and can get them a result if I make that promise. From there the jump up to $500 and $2,000 products is much easier.

[other examples – Nic Rixon’s  rule of 4’s]

If you’re thinking of launching a new car brand, maybe you should run a taxi service and try to upsell from there?

What Britain’s two biggest sex-toy stores taught me about converting traffic into sales

I probably learnt the most about converting traffic on websites when I was working in affiliate marketing in the early and mid-2000s. Affiliate marketing is a model whereby if you’re selling something online or gathering leads online, you let other people promote that offer to their email lists and their website traffic. If you make a sale or get a lead, then you pay that person a percentage. Okay? So it’s a performance based marketing model.

The early 2000s were a very formative time for the affiliate marketing industry in the UK, and if you ever get to hang out with some of these guys, they are some of the hardest working and most innovative digital marketers that you’ll ever come across. Because they’re very innovative, some of them do, I’ll admit, sail a little close to the wind on some of the legals and ethics, but that’s how they discover new stuff.

Now, the way that the industry used to work around that time was that agencies and affiliate networks and the technology providers would put some money behind a bar in London, and the affiliates and the merchants … The merchants are the people selling the product, the affiliates are the people promoting it. They would all turn up, have a get together, do a load of business, and then as more drinks went down, people would discuss the little tips and tactics that they’d learnt, particularly around search engine optimization, which was fairly easy to game back in those days.

I got talking to a young lady from Ann Summers, and for the non-UK readers, Ann Summers sells lingerie and sex toys, marital aids, things like that. It’s a high street store. It’s not a porn shop. It’s quite famous in the UK, mostly for a product called the Rampant Rabbit which is a vibrator which was featured in Sex and the City of all places. I get chatting to this lady, asked her what they had, what products they had, what was selling really well, and she let slip that they had a new version of the Rampant Rabbit coming out in a few weeks’ time. She gave me, under press embargo, some details about this product, a couple of photos, videos, and told me about how it all worked.

I went out, I saw this as an opportunity, and I went out and I bought a domain name that was close to the product name as I could get without infringing on their trademark. I put up a little review site and built a couple of links to it. I was helped by the fact that the Ann Summers website was not the best site in the world from an SEO perspective. Quite quickly, my product ranked number one on Google ahead of them. When the product launched, I started getting traffic and the traffic converted quite well. It had a big PR launch behind it. I would have a look at my traffic and sales statistics and I was making a 5% commission on a 50 pound product. I would see 2 pound 50, 2 pound 50, 2 pound 50, rolling into my account several times an hour, so happy days for what had taken me a couple of hours to build.

Now, before long I got a call from a guy who worked at a competitor called Lovehoney. They rang me up and said, “I see that your website ranks very well for this product name. Would you like to try to make some more money out of that website?” I thought, “Yeah, that sounds good.” The guy, Richard, said, “Well, we’ve got the same product. It’s made in the same factory in China. We’re selling it 5 pounds cheaper and with free shipping, and we’re also giving an 8% commission.” Now, I hadn’t really heard of Lovehoney. This was a long time ago, before they started doing TV advertising and became a much better name brand. But I knew that guy, I’d heard about him before, and I knew he was a good marketer. So I thought I’d give it a try, so I swapped half of my traffic out to his page.

Then I sat back and had a look at the stats. They were very, very different from the ones I’d got from Ann Summers. I should’ve been making 4 pounds, 4 pounds, 4 pounds each time a sale was made. The first thing was I was converting almost twice the number of people into sales. It’s exactly the same traffic coming in from Google looking for that product name, clicking on the link, and finding a page with that same product, although theirs wasn’t even called the Rampant Rabbit because they couldn’t call it that because of trademark stuff. First of all, it just shows that price is a big indicator, whatever people might tell you. If you can buy the same product cheaper elsewhere, that’s where the traffic will go.

But it wasn’t just 4 pounds, 4 pounds, 4 pounds. I’d get 2 pounds, 8 pounds, 12 pounds, 23 pounds, 1 pound. Nearly all of them were above that 4 pound mark, but they were very random. So I called Richard and asked what was going on, and he said, “It’s simple. We’re just better at upselling our customers. We’re better at getting them to buy one product and then buy two or three more as they go through our checkout. We do lots of deals selling related products, free shipping or coupons if you buy more than a certain amount.”

He said, “We’re just much better at that. The other thing is, we have very loyal customers, so when somebody buys through your link they come back and buy again quite often within the month. Because we pay you for all sales up to 30 days after that back click, you’re getting commissions from those sales too.” I sat back and looked at these numbers, and this site kept going for quite a long time until the product went out of vogue. For the sake of a couple of hours’ work, I made something in the region of around 5,000 pounds from that website in commissions.

Now, I learnt some very important lessons from that site. The first one is that brands don’t count for that much. The Ann Summers brand name, according to them, would be the thing that would give people the trust and make them more likely to buy from them online. That clearly wasn’t true. Their website just did not convert as well as Lovehoney’s. The second thing is that you can make big differences to what your customers buy and present multiple products to them if you do it in the right way and make a lot more money out of the exact same traffic, even if they came in with the intention of buying one particular product.

The third thing is that if you look after your customers they will come back and buy repeatedly from you, and that’s second sale. Typically you’re not spending money on Google AdWords or Facebook ads. They’re just coming back in, usually through your emails or your social media. Those second sales will cost you far, far less. Having some products like they did that were repeat purchase sales, consumables, things like that, are an essential part of the mix. The profitability of that business is just astronomically higher than a brand website who would try to convince us that their brand would make that product convert. Think about that.

When you’re looking for ideas as to how you can convert traffic better on your website, don’t just look at the big brands. You really need to understand the numbers behind the scenes of the successful businesses to see what’s going on in their upsells and in their repeat purchase patterns from their customers, because that’s where the real money comes from.

Unstoppable sales machines

I’ve said before that relying on word  of mouth and referals isn’t a great way to grow a business.

On it’s own it’s too unpredictable and leads to boom and bust.

You can only get referals when you have lots of happy customers. Tragically this is when you least need them.

So as a way of getting started, it’s not great, but once you have a steady flow of new leads, it’s definitely something you should be trying to work on.

Leads that are referred convert at a far higher rate than cold leads, they usually stay longer and are, in turn more likely to refer you on to others.

Your cutsomers themselves are your most unstoppable sales machines, but, just like “real” sales teams, you need to give them the tools and incentives to help them work at their best possible level.

I have two reliable ways to do this, and you can use them together to great effect.

1. The reviews & referals campaign.

The reason most people don’t get enough referals is that they simply don’t ask for them. 

I set up a campaign that runs whether I remember or not. It goes like this.

• The trigger
  Each time we finish up a project for a private client, or we can see that they’ve reached a ceratin point in one of our DIY courses, we send them a quick email to get some feedback.

The feedback is a single, very structured scale – in fact it’s a standard question that you shoudl be familiar with if you’re at all interested in customer staisfaction – called the “Net Promoter Score”

The question is “Based on your recent experience with [your company name], how likely would you be to recommend them to a friend or colleague?”

The response is a scale from 1-10

1 is terrible, 10 is super-happy

Now, if you’ve run this, and you’re patting yourself on the back about your scores, there’s a catch.

Most people are quite generous in feedback. For most people a 5 isn’t a great score. So we score as follows:

[replace with hi-res image

]
So 7’s and 8’s score 0

9 scores a 1

10 scores a 2

Here’s how to handle these responses

Anyone replying 6 or less – get on the phone – see what you did wrong, see if you can turn it around.

This is valuable feedback even if you can’t fix the issue or if the client’s expectations weren’t right going into the project.

And usually customer dissatisfaction isn’t so much with the problem – we all screw up once in a while – it’s how you deal with the problem.

7’s and 8’s are just ‘meh’. Email and ask them what you could have done to get them to score a 10.

9’s are definitely interested in saying nice things about you – you should ask them for a review. There’s a specific way to do that which I’ll talk about later

[experience-based reviews]

10’s are definitely going to refer you. So certain in fact that they probably have someone in mind. So ASK them.

That’s it, simple.

Think about when the best time to send this is.

In my agency, we have a process for closing off a project which involves recording the final invoice number in our CRM system. If a customer hasn’t been sent the final invoice, the project isn’t finished yet. When the final invoice number is raised, this is the trigger for sending the survey.

I even forgot we were doing it for a while, the process is so smooth, then I looked at a report where all our leads are analysed and was pleasantly surprised to see I had a dozen or so which had been thrown up by this process.

It’s a powerful, self-sustaining sytem which gives us some of our most profitable customers at the lowest cost.

Turning your customers into salesmen.

So, asking for referrals is a great way of turning your customers into apart of your sales process, but sometimes just asking isn’t enough.

Our customers are busy professionals, with their own businesses to worry about and their best intentions about passing on leads are often forgotten as they return to their own bursting inboxes.

But rewards can be powerful reminders.

If your product or service is one that is sold online, or you have an easy way of tracking where your sales have come from then you might want to turn your customer into a form of sales associate called an “affiliate”.

Affiliates are rewarded with a percentage of the value of a sale that they refer to you.

If you’re selling online, it’s likely that your shopping cart already has a way to register affiliates, give them a link that  they can pass on to other prospects, and that will track who has been referred by them and how much you need to pay out each month.

There are a few things to be aware of, like making sure you don’t pay out on refunded sales, and making sure your affiliates don’t badly misrepresent your brand in order to make sales, but generally your own customers are your best affiliates, to the extent that you should seriously question letting anyone else into your programme., 

Optimising for sales

The expression, “You get what you pay for,” I don’t really like because it’s usually trotted out by salesmen to justify a higher price, but doesn’t actually say anything about the product you’re getting and why it’s any better, but there are a couple of places where it is most definitely true. When you are buying customers, i.e. paying for advertising to get customers into your business, the big media owners Facebook and Google, are getting very savvy about buying lead that will turn into customers rather than just freebie hunters and tyre kickers. They are good at this because they have the tools to tell them who the buyers are. Anyone who is running a Facebook campaign that can result in a sale online is slightly crazy if they are not using the tools that Facebook gives them to report back on the sales that those campaigns made. Same thing with Google. 

Google has Google Analytics on just about any site of note in the western world and it can tell through that who the people are that but it, and it knows about individuals because a lot of those people are logged into Gmail and other Google services, just like we stay pretty much constantly logged into Facebook on our phones and computers. Both of these organisations know who the buyers are and that’s a huge difference. Blah, blah, blah, of [Agora 00:01:52] once told me that about 95% of the people in any given market just don’t buy. The internet has created an entire culture around getting information and even tools for free. I know who the people at the top of that market know that to get quality you need to pay for it. Because if you don’t pay for it, the quality people will go out of business and you’ll be left with free rubbish. The trick is finding those 5%, and often they don’t look that much different from the rest of the world.
There are quite wealthy freebie hunters out there who got rich because they never pay for anything, and not a lot of them, it has to be said. They know who these are. When I go to a client and I hear people, advertising agencies, gloating about how cheap they’re getting fixed leads for their customers and not having a conversation about sales, then there’s usually a difficult conversation to be had, but one that will usually result in quite market shift. I took on a client who had been paying $1 per e-mail lead in a quite competitive market, or self development. When we actually got their tracking in place and we showed them who were the people that were they were making sales from, there was a tiny niche of people who had been costing about $5 a lead who were the ones driving all the sales. Because all the good advertisers, the ones that optimise and track the sales, were competing over these people and driving the prices up. They were the buyers so they were worth paying for. When we started buying these $5 leads, our sales went through the roof.
Although our advertising costs went up by five times overnight, the sales went up by almost 10 times. The worst extreme I’ve seen of this was probably in the days when people were still thinking it was a good idea to pay for fans for their Facebook pages and running competitions to get likes. They would get very excited if they were getting fans to their page for cents. Then their e-mail marketing campaigns cost them a fortune because they had tens of thousands of people they were marketing who just would not buy. Competition buyers, competition entrants, are some of the hardest people in the world to get to actually open their wallets. They’re people who want something for nothing. They don’t even have a sense of urgency about the thing they’re competing for because normally a competition will stay open for several weeks, if not months. They will actually hold off making a purchase in the faint hope that they might run the competition that you’re running. By definition these people are terrible, terrible prospects. The people who you want are the ones who have sense of urgency and some pain surrounding whatever product or service you’ve got.
If you can promise to take that pain away quickly and effectively, then you’ll have a happy customer. When you are creating your campaign … Oh okay, so but optimising for sales is not that easy. You get a lot more clicks on your adverts than you get sales. You can gets tens of thousands of clicks resulting in a few thousand leads, resulting in a few dozen sales. It’s always a lot easier to optimise your campaigns around getting more traffic, getting more leads on the front-end, than it is to optimise it around getting sales at the end of the process just because there’s more data there to play with. My advice is get your numbers straight, learn how to recognise where a sale is coming from, because the buyers and the non buyers are a different people. Once you start telling Facebook, “Look here is what my customer looks like,” they can get very good at delivering you buyers but they will cost more. The overall profits will be way, way higher. It’s very difficult to send out an e-mail for example, unless you have tens of thousands of people on your list.
If you want to test which subject line is the one that drives sales, I’ve seen so many campaigns where we run tests, try two different subject lines out. One of them has got more opens, more clicks, but actually when we’ve looked back over the data, it was the other one, the less enticing one, which has driven sales. It’s very easy to get people to open and read your e-mails or look at your Facebook page when you’re being entertaining, but not so much when you’re selling. It’s very easy to optimise your campaigns for clicks and leads and be getting the wrong people for your sales process. If out of 10,000 clicks you get a few thousand leads and a few dozen sales, that’s often not enough to work out whether subject line A has beaten out subject line B. You have to do it consistently and not many people have the luxury of enough people on their databases and enough traffic to do that, but it’s something you really, really need to push towards. Have more patience with your campaign that may look more expensive, but they are capable of driving actual buyers and not just tyre kickers.

Data is an asset, testing is an investment

Have you ever seen the Google coupons that give you £75 or $100 worth of free traffic when you open up a new AdWords account? If you’ve read any internet marketing related magazines, in particular, you probably have come across these. Google may even have offered you one if you’ve opened up an account and haven’t used it.

Well, I’m amazed that these are spread about so widely because to my mind, they look like one of the most damaging things that Google has done for its own business. I say this because when I talk to people about paid traffic and ask them what people have done, are they doing any AdWords advertising, the number of people that come back and say we tried that and it didn’t work for us is astonishing. You would think from the number of these conversations I have that AdWords only works in a very tiny niche of businesses.

Now, when I dig further and say, “Okay, so what have you tried? What did you do?” Normally people clam up with embarrassment, to be honest. More often than not the response is, “Well, we tried one of those ads from Google, and we spent our $75, and we didn’t get any results back at all.”

Now, let’s not go into even details about whether their ad-copy was any good, whether they were choosing keywords correctly, whether they’d set up landing pages for these. I think that I can usually assume, and this is backed up by the number of campaigns I’ve actually looked at, that if you’re only prepared to invest $75 into trying out whether AdWords works in terms of media, you’re probably not employing a copywriter to write your ads, a copywriter to write your landing page, a developer to create the page, a developer to add all the tracking codes and make sure that you can see how many leads you’ve got, and all the other things that go around operating a campaign at scale.

The investment it needed to get paid marketing to work is not pocket money. It doesn’t have to be enormous. A couple of thousand dollars in getting your campaigns set up, getting the followup set up, getting your landing pages set up, and having somebody start that campaign off with at least a few hundred dollars in media spend. That’s not a lot to start an advertising campaign. That is comparable with one day on a stand at medium sized trade show, and most people will expect that they will get some names back from there but not necessarily some business out of one show. It’s about the same as a couple of months of a retainer from a PR company. You might get some exposure from that but you wouldn’t expect to be hitting big leads from it. 

I think too many people have looked at this $75 and think that that’s all it takes. Now, it would be nice if Google could give the amount of traffic that it takes to actually get somebody a sale and then they would have the confidence to carry on with this. I imagine we would probably be awash with amateurs trying out free traffic if that was the case.

Now, we see a lot of people selling courses on online advertising techniques, saying that you’ll make $5 back for every pound you put in, and some people can achieve that. Let me tell you something, they did not hit that number on day one. Most of the well-respected media owners that I know and with the clients I’ve worked with, you’re typically looking at four, five months to get really solid consistent results back. You get some small wins in that stage, scale those up, but you’ll also be spending money that doesn’t give returns, and you have to do it to see where things work and where they don’t. 

A good experienced media buyer and a good experienced funnel builder will be able to get you to those results quicker, because they’ll have tested things in other markets that they know will be worth testing in yours. They’ll understand the intricacies of how the different AdWords platforms set up, which is why you have specialists in Facebook, and YouTube, and Google AdWords. 

More importantly, they will have tested lots of different images, copy, landing pages, follow up emails, even bonuses and up-sales to the main product itself. They wouldn’t have hit these and then we tried different search words in AdWords or different audiences in Facebook. We won’t have got to those numbers so we worked out what the differences are between people who see your offer on a mobile and people who see you offer on an office desktop machine. 

Let’s look at that statement again that paid advertising doesn’t work for us. If you’ve done your research and you found competitors in your market who are growing their customer base through paid advertising source, and you can see that they’re doing this, that a number of them are doing this and have been doing it for months or years, have been repeating AdWords, you can make a reasonable assumption that this is something that works for them. Not just from one player who might have been wasting money on ads because they’re not tracking things properly and they’ve just throwing mud at the wall, but from looking at a reasonable number of competitors that give you that insight.

Ask yourself honestly and brutally what is so special about your business that means that you can’t access the same pool of people and make sales out them. If it’s because you’ve got some special sales process, maybe that sales process is actually working against you. It’s more likely that you simply haven’t tested enough different variations if your AdWords, and landing pages, and [inaudible 00:07:34] to work out the one that really works in your market. 

Now, sometimes the changes can be quite subtle. A couple of weeks ago I was talking to a friend of mine, another agency who had been working on a service for IT contractors. We were sharing some results on a test because I was working in a similar but non-competing market.

We were looking over some things that they’ve tested, some copies and colours, different layouts on each page. The thing that had made the biggest single difference and had helped them cross the line from being a loss making campaign through a break even campaign to a profitable campaign, was a single photograph. They’d started off with a hero image on the page about young successful city worker because most of their clients are contractors who work in the city of London. Actually, the IT contractors didn’t really identify with this character at all.

We didn’t want to show some nerdy guy with a pen protector in his pocket, but by swapping that to somebody who is hard working at their desktop, we found somebody that they identified with much more closely than somebody flouncing a Rolex watch in front of a flashy office building, which they saw as being much more like the characters who they worked for, rather than them and their peers. With one of my clients we actually saw sales go down over the first three months, because one of the advertising sources he’d been used to was drying up, it was a site that wasn’t getting much traffic anymore, but he could see the efforts we were putting in elsewhere to find traffic from Facebook or Google were going up and would eventually counter this.

It was a lot slower than he wanted, but he knew we were doing the right things, he could see the tests we were putting in place were by and large creating improvements. When he spoke to a few other people and got some honest answers, he realised that our hit rate on tests, i.e., the number of tests that we did that resulted in an increase in his revenue, we were actually doing quite well, and that he would just been starting from a lower base than he’d led to believe some of his competitors were. We kept at it and we kept at it, and the line kept growing. Every once in a while we’d do something that would do a big kick up and we’d think that we’d reached the hockey stick, then the next test would be flat and then flat again. You could see our client was a bit browbeaten, but still had confidence in us. 

After about nine months we turned a major corner in some of the targeting of our customers, because we then have the data to go back into our campaigns and find out about the people that actually were buying. That opened up a whole new bunch of avenues for us, whole new set of copy, whole new set of bullets in our copy, that would target those individuals specifically. Now we’ve gone from a campaign which was barely break even to a campaign which makes six times the revenue and 10 times the profits of the original campaign. 

Put in a subtitle here about gathering data.

Our experienced marketers know and expect that it will take a while for their campaigns to reach profitability. One of the reasons why they don’t get downhearted at seeing money flow out of the door and into the pockets of Google and Facebook, is that they do know they’re getting something back. What they’re getting back is valuable data. If they get £1,000 worth of sales that’s cost them $2,000, they’re not looking at that as a £1,000 loss. They’re looking at that as £2,000 worth of market research. They now have some buyers, they can go back to those buyers, find out what they found interesting. They can get testimonials from those buyers, they can use the data about those buyers to find other people who look like them. It’s an enormous step forwards.

The testing process is not just about trying to reach profitability. It’s about understanding your customer better, in order that you can understand where they hang out, understand how to market to them, and understand their buying triggers. The difference between just having an email list and having buyers is as wide as the Grand Canyon. Sure, if you’ve been spending thousands and getting no sales and no leads whatsoever, there’s definitely something wrong. If you’ve been running a campaign that is making sales but isn’t making profits, you are definitely bringing an asset into your business with those customers, that you can use to refine and increase the size and scope of your campaign in the future.

You need to take a different viewpoint on the first few campaigns that come in. The things you can do when you’ve built up 50 to 100 customers of a specific product, are totally different from the things you can do when you have 500 email addresses of people who are merely interested in your topic area. Those people who will actually spend money on your product are gold, whereas the rest are really just rubble. A big email list might make you feel good, but it’s not going to pay the rent. The big marketers understand the mindset of gathering data, of building a customer list, which is more valuable than just hitting profitability straight away. 

The big numbers

The true cost of a customer

Acquisition costs

Content production costs

Support costs

Wins and assists

The challenge of attribution

Until they buy or until they die

Lead velocity – how quickly do they become customers? How long is your payback on paid media

Selling dollar bills for 90c

Why gross revenue figures are such bullshit

One of the last things you’ll learn really is a closely guarded secret in most businesses which aren’t publicly traded businesses with shareholders.

And that is the phrase “sales for vanity, profit for sanity”.

The internet is full of wild claims about sales figures being bandied about.

7 and 8 figure launches, 10’s of thousands being made in an hour on webinars, pushing a button and making more than a month’s rent from a single email.

I’m sure you’ve seen these types of claims, and I hope you treat them with the type of scepticism they deserve.

Digoital products in particular are a very competitive area. With almost no cost to produce and distribute, and no worry of ever running out of stock, they are a great business model, but as they are SO easy to get into, the barrier to entry is alsmot nothing, and that means the competition is enormous.

To get noticed in the hubbub, takes a lot of effort, and that effort costs time or money. As we all know the phrase “time IS money” we can rephrase that as effort takes money or money.

A few things you’ll need to pay for to sell a mllion dollars of product:

Investing in a video setup, or time in a studio

Design & branding

An email system, shopping cart and membership site to store the content

A webinar system like GoToWebinar or Webinarjam

A website, hosting and maintenance to keep it secure and up-to-date

Most of all you’ll  need to factor in around half the product price in advertising costs or affiliate commissions.

Add it all up and it looks less attractive (although still way better than trying to shift $10 iPhone covers on ebay, for example).

The huge launches you hear making millions on their first month often take away less than 10% in profit for their owners.

Now, don’t get me wrong, a $100k payday isn’t to be sniffed at, but it can take you a year to pull the product and marketing together for a lunach like that, and many go broke before they get there.

The real value is in the customers you now have in your list that you can sell to again, and again, and again. Just like our shirtmaker, Jeffrey.

Know your numbers

Know your pricing, your advertising costs and your profit.

Know how much of that profit you need to take out, and how much you can re-invest to grow.

Top poker players talk about their “bankroll”. The amount of money that have to gamble with, and they have very hard limits as to how much they’re prepared to risk in a single session, and how much they need to keep in the bank even if they want yo buy a house or a car when it gets big enough.

Blow it all on a car, then lose a game the next day and you’re broke, with nothing to play with.

Profit is sanity.

In the first dotcom boom everyone was hell-bent on getting traffic to their websites. It was a huge landgrab, except noone had factored in that unlike a real-world land-grab there was an infinite amount of land to be had.

Some supposedly very smart people started the philosophy that you could “afford to sell dollar bills for 90c, as long as you could make another 11c in the process through advertising.”

They couldn’t of course, and the dotcom crash of the early 2000’s sent these people out of business.

Eyeballs, likes, shares, and the biggest vanity measure of all – traffic – won’t pay the bills on its own. They are all just indicators of how you are progressing towards the only goals that matter. Sales, and ultimately profits.

Summary – The XXX Lessons

1. Products for markets, not markets for products
2. Paying for precision – paid marketing gives you control
3. Learning before earning – first sales are for data, not profit
4. Product ecosystem – upsells & downsells
5. Lifetime customers – what to sell next – move to continuity
6. Perfect targets – how to mine your own customers for data
7. Competitors – your best JV sources

What to do – pillars

audience understanding

The first of our pillars of creating a really great product and a really great funnel that will convert the maximum number of our customers, of our prospects into customers, is really, really understanding our audience. My aim in this phase is to find at least a dozen named individuals who I think are likely to want to spend money on the product. The reality is that actually getting those first 12 people to buy the thing is quite difficult, so what I’m normally actually trying to do is to find the first dozen people that I can invite to be testers of my original product. If I can’t find 12 people who are prepared to at least commit the time into going through one of my products, that’s a serious red flag that I might be barking up the wrong tree, that I’m pursuing a project that there’s no real demand for. That doesn’t also.

This process will normally take me … I’ll probably really embed myself in the market as much as possible for at least a month, unless it’s something that I already know a lot about. If I’m selling to one of my other online marketers, I really understand that audience already, so I don’t need to spend as long in it, but if I was entering a new market and doing this for a client where I maybe wasn’t as familiar with their market, then I really need that time to spend digging around and finding people who have a problem and understanding the words that they use, understanding other influences on them, things like that.

The first place I usually start … I’m going to go through a number of places where we can find people, see some of the language that they use, find out what other products might be out there, find out what might be missing from those products so that we can really help create a better product than the ones that already exist. The first place I usually start is in Facebook groups. Facebook has become an amazing place to find little niche groups of people. Once upon a time, I would probably have looked for forums. Say if I was looking for example in the weight loss niche, I would look for weight loss forums, dieting forums, keep fit forums. So much of that activity has moved into Facebook now, just because that’s where people spend all of their time.

Even if we’re looking at a business-related subject, I would still use Facebook. I find that LinkedIn groups are very stilted. People aren’t very open in them. People are professionally guarded. They’ve got their suits and ties on, and you don’t get the same kind of honest language out of LinkedIn groups that you do from Facebook. I have a dig around in there, join up, just read through as many threads as possible, and try and find common themes.

When I find an individual that says they have a problem, I just make a little note of that individual’s profile, and maybe ask them for a little bit more detail on the issue, try and offer a little bit of help if I can. The more helpful you can be, start building up an audience, but generally speaking, start by listening, not by jumping in and solving people’s problems. That’s the first one. That’s probably at least half of the research I’ll do in most areas, is within Facebook.

Other places, there are sites like Quora, which is a questions and answers site. That’s quite useful for you’ll see questions that are being asked, but quite often it’s a bit rigged. There are people who will get a friend to ask a question on Quora just so that they can reply to it and link back to their own website. The questions themselves you have to take with a pinch of salt. 

It’s very interesting on the long threads to see the suggestions for solutions that people will come up with. If somebody is looking for a great piece of accounting software, for example, you’ll get loads of replies to that, some of them in quite good depth. Some of them people will ask for clarification on. That’s a good place to go looking, and it covers all sorts of different areas.

Forums, I will go looking for those. If I’m looking for accounting software example, I might look for small business forums, marketing forums. I don’t know if there are accounting forums, but ones that will look for words that will call out the kind of customer. You wouldn’t necessarily go looking for an accounting forum because it will be full of accountants, but if you look for small business forums, you’ll be following people who are your customer.

Okay. The next two things I look at are review websites and specifically Amazon and Udemy. Udemy is a bit like the Amazon of online courses. First of all, I go looking for products in my area on Amazon. To carry on with the accounting example, you might look for do it yourself small business accounting books. The first thing is that you need to find some. If there are no books in Amazon on a topic, that’s a big, big red flag that you could be looking at a subject area that nobody’s interested in. There are thousands of books on all sorts of subjects on Amazon, ranging from really good quality bestsellers down to trashy little 99 P kindle titles which are really just there to try and get you to buy it and then sign up to an email list.

I will try to find a book on Amazon which has got at least 20 or 30 reviews, which is not difficult to find. Some of them have hundreds of reviews. What I’ll do is I will ignore the five star stuff, because they don’t normally have anything constructive to say, but I look through the four, three, two, and ones, because what they will normally say is, “This book was great, but.” That but is a fantastic pointer to tell me what might be missing from that product, and it’s usually that it didn’t go into enough depth on one or other particular areas.

Amazon, I’m doing two things. One is to make sure that there’s a market there, and the other one is to try to find gaps in the bestselling products and to find out what we might be able to provide to the market that’s not already there.

Udemy is a similar thing. Most of what I get involved in is selling digital products, either software or training courses. Udemy is fantastic for that. There’s not quite the same volume of sales on Udemy, but some of the top sellers certainly do that. I have clients who are selling literally tens of thousands of units every month on that. There’s a handful of areas on Udemy that are really popular. Very technical training courses, like how to build an iPhone app, those things are very popular. A lot of things in self development. There are a lot of topics in business-related topics, particularly marketing, some accounting type things. They’re very specific tactical products on there. It’s very good for those.

Again, I go to the reviews, and I’ll be most interested in the ones that gave less than five stars, because I’m looking for the gaps in there. The five star reviews are good. If they consistently say, “This had very clear examples,” or something like that, then you know that’s important to the market. Don’t ignore them completely, but in terms of product development, I’m usually trying to find the holes.

What I will do then is I’ll take all this information that I’ve gathered about what other products are out there, what problems people have, the questions they have, and the holes that are left by other products, and I’ll create what I call an empathy map. My empathy map is all about putting myself in the shoes of my confused beginner prospect, which is very tough. If you’re an expert in an area, it’s really, really hard to put yourself back in those shoes again, and this tool is there to help you do that.

It’s basically six squares. The first two talk about what pain they have at the moment that try trying to move away from. It might be they’re wasting time on their bookkeeping, that they feel unhappy because they’re overweight, that they have a product that they’ve invested hours into creating and they can’t get anyone to buy it. Then I try to understand what they’re trying to move towards, so free time, feeling good about themselves, having more sales. It might be that that’s if somebody’s trying to sell their product, it might be for the money, it might be for self-validation. It might be that they want that feeling that other people value the knowledge that they have. There’s all sorts of motivations people have other than health, wealth, and happiness are the three big ones. Maybe elaborate on that.

Those are the two big things. It’s what we’re trying to achieve with the product. Around that, I’ll try and come up with four sets of characteristics about my customer, which are things that they think and feel, things that they’re hearing from other people, things that they’re saying and doing, and things that they’re seeing. Thinking and feeling will be things like they feel confused, they feel exhausted, they feel overwhelmed, they feel frustrated. It’s worth ticking off some of the seven deadly sins. Do they feel envious of other people? Do they have greed for money that other people have? Things like that, that’s a strong one to look at. I’d very much recommend doing that.

Then there are things that they’re hearing from other people. These might be truths. They could be myths put about the industry. They could be hidden agendas that are put out by people who have something to sell. They may be the words of other authority figures. These are important, because you may need to overcome some of these. One of the reasons for writing this book is I see all sorts of rubbish that people have pitched to them by SEO companies promising easy traffic and sales, and I just know it’s not true. I need to spend a lot of time re-educating clients on getting focused on quality traffic and putting their efforts into converting that traffic and being much more specific all the way through, which is what this whole book’s about. What are they hearing from other people? What are the myths you might need to either crush or maybe go along with and then steer them in your direction?

The next one is what are they seeing. Are they seeing evidence of success elsewhere, and is that success real? Are they seeing what I call the Facebook fantasies, i.e. somebody claiming to be a fantastic life, fantastic business, but in reality they’re on the brink of divorce, on the brink of bankruptcy, sleeping on the beach in Thailand, not living in a lovely hot hotel like they claim they are? There’s a lot of frankly serious bullshit out there, and uncovering some of that can be quite interesting, because that might be what your customer is trying to move towards and it might not be realistic.

If there’s evidence of success, does that match up with what you’re recommending? Even if somebody’s not a client of yours, if you’re seeing somebody using similar methods and getting success with it, you can talk about their story and back up their argument, so things I’m saying.

The last one is, what are they saying and doing? Do their actions match their words? Are they saying they want to lose weight but eating three donuts every morning? Are they saying they want to earn money but goofing around on Facebook all day at work? Do their actions and their words actually match? Have people tried things before? That’s a really big tell-tale sign as to whether somebody’s a good customer or not. I used to build websites for people, and our best customers were always people who had tried once and failed. They understood our value. They’d put some effort into it. We were more likely to get some success, and they understood our value because they tried and failed, and they valued our expertise. Is somebody an absolute beginner on this step? Is this their first foray into your market, or have they tried a couple of other people first? Are they just talking the talk, and will they actually follow through?

That empathy map is a very important part of the customer research, and I absolutely would not skip that. With all these together, the very best way of getting audience research, not asking them what they want but definitely watching them. The best way to do that is to create a very small version of your product that you can see if people bite on at all. It might be a short course delivered over three or four emails. It might be an ebook of no more than 5000 to 10,000 words. It might be a teaching webinar where you give some of that information away for free. By doing that, you can build up an email list.

You can create a very quick landing page offering these things, drive a little bit of Facebook ads to it or Google ads, whatever it might be. You can pitch stuff in social media. Start building a list around these things. The process of building your list is a part of the research process. You’re not trying to make sales here. All you’re trying to do is to see whether people are prepared to make the minimum investment in your product, which is giving up their email address and a little bit of time.

That email list will really help with the next stage of research. There are some fantastic tools inside Facebook where you can load up your list of people and get feedback on who they are from Facebook. I’ll give you an example. I was running a product which we had been aiming at MBA students. It was around rapid learning. We originally pitched it at postgraduate students who were about to spend a lot of money on an MBA course and needed to keep on top of the amount of reading and learning they were doing.

We built this product, and started building a list around it. When we put that list into Facebook, we discovered that there were a lot of people who were beyond doing that postgraduate education who wanted this, particularly lawyers who need to consume a huge amount of information on a daily basis, and be able to recall it in court, and doctors, who same thing, need to be able to remember an enormous number of medicines and dosages and symptoms and all kinds of things, and be able to recall it very quickly when a patient comes to visit them.

We created two sections of the course specifically for these guys, and we can promote it as being designed for them. It gave us a fantastic insight into who our real customers really were. Who were the ones who were actually biting on that bait of the webinar we did?

If you do a webinar, there’s a fantastic tip I can pass on as well, which is that webinars are slightly odd in that somebody signs up, and then there’s usually a delay before you deliver the content to them, particularly if you’re doing your webinars live. That landing page, that thank you page, which is a bit of dead end, can be a very valuable place to ask questions about what’s their biggest problem at the moment and what have they done so far to try and get past this problem. You will get some amazing insights from that, and I can tell you that the people that fill those questions out and put the most effort into answering them are usually the people that go on and buy. There’s a very high correlation between those. You can see, if you’re getting lots of people putting lots of detail in those questions, I would say that you’re on the way to having a fantastic product.

With those in mind, you then should have a great idea about the problem that your product solves, about how your product is different from other products where they have failed to deliver against the market. You should be able to talk to the real pain points of your customers, and you should have the beginnings of a list of people who you can give your first product to or send it at a very small discount and get them to test it, to get the results that you’re promising, and use their testimonials in your marketing as you go forward.

The ability to do that, and taking the time to do that, will absolutely separate your course into something that’s worth thousands of dollars from the massive, low-quality products that end up selling as 99 P Kindle books or get sold in $9 sales on Udemy. It’s a really big part of what makes a successful product, and I really urge you to not skip this part of it.

product that gets results quickly, then deeply. range & continuity

Now it’s time to start putting the product together. I deal mainly in digital products. That means software and online training. It’s the latter one that I’m going to focus this process on, but it can work equally well for software. The first thing I’m going to cover is the difference between short-term and long-term education in training products. The people that will pay the most for a product are people who have immediate need to solve a problem and are prepared to invest into that or people who can see pretty much a guaranteed increase in their income, health, wealth, happiness in a permanent, longer term. Those are the two kinds of people we’re trying to look at.

Education, as in the kind of education that we get at schools and universities, tends to deal with the long-term education. It’s more generally skills, understanding theories, and things that will allow us to approach a variety of problems in the future and have a way of solving those problems. In the short term, the people who have an immediate problem, like they a weight problem and have been told by their doctors it’s going to kill them in six months if they do nothing about it or the person whose wife has just threatened to leave them or the person who has just got a terrible performance review at work and is potentially going to get the sack if they don’t improve, those short-term problems where they need to get a fast fix to get started.

In order to appeal to both of those groups, you need to cover both angles. You need to cover the base theory and the general education that will help the people to get the long-term understanding of how to make long-term, large changes, but you also need to include things which will solve a short-term problem for the individual who have a very urgent, what we call a burning house, problem. If your house is burning down, your only problem is how do you get out of it, how do you get out of that situation quickly. That’s what I mean by burning house problem. That means that the way we structure our calls is really in two parts.

We have the education section, which covers the why are we doing this, what’s the theory that underpins it, why is this correct way of approaching things. Then you need some very practical sections, which will cover checklists, fill in the blank, things that people can go to straightaway without necessarily having a [beef 00:03:22] understanding of the theory behind your solution. In weight loss, it might be a meal plan. They can just do it. They don’t need to understand their macros. They don’t need to understand how the body functions. They just need to eat the right stuff for six weeks, start losing some weight. After that, they can go back and start to adapt, learn more deeply, make those long-term changes. 

It’s very important to understand that some of the things that you will offer as part of your product, some of the bonuses, some of the add-ons, they’re not just there to ramp up the perceived price of the product. [inaudible 00:04:06] an extra $1,000 value on each of those and then give them away for free. Those bonuses are your best shortcut to the results that you can offer. 

Learning is hard, and a lot of people, if then forced to go through the learning process before they apply it, would just lose interest. If you want to learn a language, you don’t start off by learning about tenses and how to conjugate irregular verbs. What you want to do is learn how to get directions from the airport to your hotel, order dinner, order a drink, find directions to the sites you want to see, and pay for things. A relatively small set of vocabulary will carry you a long way. You don’t need to understand why there’s a particular ending to a particular verb. You just need to know that that’s the right words for that situation. You get in, you get a result, and then if you need to repeatedly go back to the same learning, then you start to understand the principles behind it. That’s the way that people really actually get motivation to continue to learn is by getting some quick results.

It’s very important that you don’t look at these bonuses and shortcuts as short-changing your customers, that you don’t get too precious about the educational process, but that you do get precious about achieving an outcome for your customers. Covering short-term education needs and long-term education needs in the product would appeal to both of those kinds of people and will give you a much higher quality product and something that will get results for a wider range of people. You need to include teaching. You need to include what we call the magic bullet bonuses that will get them to those results quickly. 

What you also need to do, particularly in the more theoretical part of your courses, is to include check your understanding quizzes. This is really feedback for you so that you can make sure that you’re teaching is clear and that the people going through it are getting that long-term understanding that they need to, and you need to include reviews at certain points in the course, as well. Usually, when somebody has completed a large chunk of the course, and this again will give you the ability to work out in the [first detractions 00:06:54] of your course, whether it includes all the things they need, it gives you very valuable feedback, and it might even spring a few people up who can provide reviews and testimonials for the product that you can use in your marketing and possibly even refer other people into it, as well.

The reviews are very powerful. It gets the customer … If the customer says something positive about your [inaudible 00:07:17] that will engrain that feeling about you in their head and they’ll be much more susceptible for you to ask them for a written review for your marketing or to ask for a testimonial afterwards. The thing that will really set apart a high quality and high value training programme is accountability. It is quite astonishing how many people will buy courses costing $1,000 and more and just don’t put them into practise. I’ve seen courses selling on this. In online courses, we can see how many people have watched how many videos. We can see their scores in the checking understanding. 

It’s heartbreaking to see people buy these courses, do the first few videos, and then just lose interest. It does happen. That’s fatal for your course. That’s fatal for your product because if people don’t go through the course, they don’t do the exercises, they don’t implement, then they won’t get the results, and if they don’t get the results, you won’t get testimonials and you’ll find it much, much harder to bring people in.

One way of attacking this is the cohort base course. Rather than allowing people to sign up when they want and go through the course individually, you set start dates for cohorts or classes of people going through where they go through together, you create some interaction between them, introduce them in a Facebook group, get them to check in on apps like Coach.Me, things like that, and get the group to create a dynamic where they’re pushing each other on and where individuals will feel guilty for not following that programme. 

In a live environment, where you’re mixing up live workshops, it’s much easier to do when people have met face to face, so you want to do as much as you possibly can to create that same kind of environment online. Group video meeting calls that you can do for free using tools like Zoom and using more Skype calls, using webinars where you switch the camera around when people are asking questions so that people can see each other, see there are other real people on the calls and frankly feel a bit guilty if they’re not pulling their weight and getting the results. Any way that you can build that in and build some of that live connexion into your course is going to ramp up the number of people that complete it and the number of people that will say good things about the course. 

This brings up the next question, which is one of the amount of contact that your students will have with you. Many people find it appealing to do online courses because they can [settle 00:10:13] and sit right there hours from time. They don’t need to be there to deliver the calls every time, but for a high-level course, people will need some kind of feedback. As an absolute minimum, you can expect to have to provide some kind of group coaching calls or webinar as part of any course that’s costing probably more than around $500 and definitely for anything that’s more than $1 or $2,000.

High value courses above there generally are more expensive because they have more contact with the course leaders. For people who want more depth, more of you, you need to start thinking about your product ecosystem, what do you sell them next. You’ve had a lot of expense bringing these people into the course, a lot of expense giving them support, and you need to work out how you can maximise that, but also maximise the value that you’re giving to your customers. Having a premium priced individual coaching type course over and above the main one is a very good way of doing that. It’s there for the people who need more help, but it also gives you an opportunity to maximise your profits around the individuals that sign up to your course and gone a long way through. 

Similarly, some people will find that your courses may be too big, too overwhelming, and just need a small part of it, so there is a possibility that if you fail to sell somebody on your core product that you can break little bits off of it, small chapters, small chunks that will help somebody get part of the way to their solution and then come back for the next piece. Generally, you’re charging higher prices for things which require more content and lower prices for things which only cover part of the solution, but you’re not leaving them hanging. You’re just giving them one step and then you sell them a second step later. Typically, those smaller products won’t have much in the way of interaction with you. 

For the people who want to make long changing differences in their work life, their relationships, the last part of the ecosystem is a continuity product. A continuity product is one where your prospect is allowed to come back to you on a regular basis, regular group coaching course. If you’re dealing in an area where you’re content is updated frequently, then rather than having to keep going back in and updating the product for the benefit of people who have already paid once, maybe charge them on a subscription basis and promise that that product will be updated. For example, I have a friend, Ricardo Lopez, who runs a course on Facebook advertising that’s a very fast evolving area. They’re constantly bringing out new features, new tactics, things that worked six months ago now don’t work so well, things like that. He has the opportunity for a continuity model where somebody can stay with him for a few hundred dollars a month, and they’ll get access to new revisions, new features, and updating their knowledge of the initial training that he gives them.

That product ecosystem, again, is high value content with more contact with you, the course leader. It’s lower priced products for people who don’t go for your core product, which gives them a little bit of the solution and less contact with you, and continuity products where people can get updated information and can carry on practising , refining, and getting better at the thing that you’re training them in.

Thinking about what you can provide to your customers once they’ve got their first result with you is an essential skills for the long term health of your business.

Once you know and can increase the lifetime value of your customer, all sorts of avenues for acquiring customers – sometimes at a loss at first – become possible and you can make serious strides against the competition.

content marketing for authority, objection handling and pre-enforcement of your model.

Now we know what’s in our product. We need to start thinking about content, and the content, before we start rushing out, hammering out blog posts, we need to have a little think about the objectives of our content. Now, first of all, let’s just define content. Content is any information that you put out into the marketplace on your website, on other media platforms, which is designed to get people back to your environment, possibly onto your email list and buying your product. It can be as small as a short snippet of advertising copy, it could be a sales message, or it could be something less overtly sales-y, so a blog post that describes the problem that your prospect’s having and leads them towards the solution. Or a series of videos that does the same thing. It can even be interactive tools like quizzes or a software tool that will help them to achieve an objective.

We’re going to separate out our marketing content, the stuff that we give away in order to lure people into our selling environment, and the product content itself, which is strictly paid for. Let’s have a think about the objectives of our content. We’ve already said that the end game is obviously to get these people closer to us in a selling environment and to eventually buy the product. For higher ticket items, there are other layers that we need to get through before somebody will buy from us. Those layers largely consist of trust, trust that you are capable and that you can do the things that you say you do, but also familiarity and your much your prospects will bind to you and your way of doing things. Two copywriters might claim to get the same results, but you’ll choose one over the other and actually the choose will be more emotional about the person you trust most, the person you feel most comfortable working with. Same thing with two chiropractors or two personal fitness instructors. The choices will be more than just their capability.

Let’s look at some of the different types of authority that you can display in your marketing. The first one is what I call academic authority. These are people who have got qualifications or who have studied a subject over a long period. That would imply that they have some kind of skill in it, particularly if they’ve got some kind of qualifications which are recognised within the industry, that would be the same thing. It’s a little weak because it doesn’t necessarily show that they have got results for other people. The next one, again, which is a little weak is what we call the halo of authority. This can be useful when you’re first entering a market and you don’t have much or maybe anything in the way of case studies yet. 

The way this works is, you say, “A well known entity does this, follows these same routes as us and look at the success they’ve got.” This is why you see people saying, “This is how Apple became a multi-billion dollar company. This is how McDonald’s became a multi-billion dollar company. This is how Google became a multi-billion dollar company.” What they do is describe how they believe those companies found success and map out those same steps for you. Again, it doesn’t have the true stamp of authority, which is that they’ve achieved those results themselves for other people, but it’s a very compelling argument.

The next one is authority through their role. For example, somebody who worked at Facebook or Google, example would be Noah Kagan who talks a lot about being Facebook’s, check this, third employee and the second employee at Mint. Both successful startups. The implication is that if he works on something and he’s an early stage founder, it will be successful. Now, the absolute best of all is demonstrated authority, which is, “I’ve done this and I got these results.” Or, “I directly helped this other person and they got these results.” Being able to give case studies and testimonials, which show what you yourself have managed to achieve in the thing that you’re teaching.

When we talk about testimonials, these are a very, very powerful part of marketing and it’s worth a moment to stop and look at how these work. Really, there are two kinds of testimonials. One is that experts in the market endorse what you’re saying. You go to the people who are well known, certainly famous, otherwise those names won’t be recognised, and they say, “This is an excellent …”. You see it in the books market all the time, where people will get quotes on the back cover from either famous critics or other people in their industry. That’s more like an endorsement. 

The other sort, which I think is very powerful, is what I call the redneck review. This is taking somebody who your prospect considers to be of lower status, intelligence or ability than themselves, and show that you got the results for them. The story you’re creating in their mind is, “Well, if this guy could help the 300 pound truck driver to get down to a weight. I’m only a little bit overweight, he can definitely do it for me. If this guy can get this high school dropout to understand and execute a good marketing campaign, I’m brighter than him, he should be able to do that for me.” Those two types of endorsement or testimonial, you need to think about exactly where you use them, who your prospect is, which one they’re most likely to be swayed by.

Let’s start looking at some of the content that you can create. I think a very powerful way of looking at this is to think about the stories you’re trying to tell your prospects, because stories instantly make an individual engage and reimagine the story with themselves in it, which is a very powerful psychological trigger for them binding themselves towards you. Some of the stories you might want to tell in your content, first one is the, where you learn this, so what’s your backstory, what set you up to learning this stuff, what were the failures you had before you learnt the techniques you know now, what were your epiphanies, what were the aha moments where you realised that the wisdom that was being passed on by other people wasn’t working or that the way you were approaching things weren’t working, because you will find that those stories are what will put you closest to your prospects. That’s the situation that they’re in now, and they will then be more likely to follow you. Look at the monomyth and the hero’s journey as a way of telling these stories.

Another sort is what I call tear down teachings. Tear down teachings are where you can go and look at another person who’s in need of your teaching and show in public how you dissect that. It’s used a lot in people examining marketing campaigns. I’ve seen copywriters do it, where they’ll dissect a sales letter, show where the problems are, the pit holes in that. It can get a bit too close to hard teaching, so stick to principles. When you get too much into the how to, that’s the kind of stuff that becomes your page content. 

The next one is objection handling. Other than price, which is always an issue, there will be reasons why people will say that they can’t use your product, that they don’t have the time, that it conflicts with other things they’ve heard. They’ll come up with a lot of reasons. Mostly because they’re fearful of taking the steps forward and they’re trying to push onto somebody else. Objection handling, the form of this content goes like this: our case study, our person, Bill, we’ll call him, thought whatever the problem was, they did my plan and they got these results. It’s, here is a person who had the same objection as you, was acting in accordance to those objections, changed the way they did things to the way I walk about it and got these results. 

Somebody like Ben Settle, who espouses daily email campaigns, will do this a lot. He will talk about people who thought that sending email campaigns would push away his prospects, would result in people unsubscribing from his list, and damage sales. He quotes numerous examples of people who came round to his way of thinking, started emailing more frequently. The people that left his list were the tyre kickers who weren’t really interested in him, but the real prospects became more closely bound because they were seeing the more frequently, and sales actually went up. That’s a great example of an objection handling piece of content. Emails are a fantastic place to do that. Drip out those case studies, drip out those stories, and you’ll see people coming round to your way of thinking eventually.

Channels, being everywhere, multiple formats, owned, earned & paid, acquisition & contingency

Now, our next step is understanding channels. Channels are the different routes that we can use to reach our prospects. Here we’re typically talking about different digital channels, different platforms, websites, types of websites that we can use to reach our prospect. We might include live events as well as one of the channels we can use to contact our customers. Our first step is to break these down into three types of media that we can use to reach our prospect. The three types are paid, owned, and earned media. Let me go through what each of those means and what the impact of that is on your business.

The first one is paid media, and this is what most people think about when they think of marketing or advertising. It can be print media like magazines or newspapers where you can take out adverts. It could be websites like Google where you can use their AdWords platform. YouTube where you can show your adverts before some of the videos that are played. It could be the adverts in news feeds on Facebook. It could also be you paying somebody to feature your product in a newsletter. Media owners can be very slow, niche, well worth approaching if they do [inaudible 00:01:59]. They market you, or they can be the giants of Facebook, Google, and the huge media moguls. Paid media is a necessity of building a business that people need to get their heads around. The reality of getting free traffic from places like Google, who are in business to sell advertising, is in my view only something that’s going to work with increasing amounts of work and could be entirely a blip that we’ve benefited from over the last decade or so.

The same people do run what I call as earned media, so let me describe that and then come back to how we use the two together. As we talked about earlier on in our working with giants discussion, we … Google gets people to its search engine because it’s able to then pass them off onto good quality content on other people’s websites. So if you work on creating good quality content and promoting that so that Google can see it, then you will earn some of that traffic. Likewise, if you come up with great engaging, interesting, unique video, post that on Facebook and demonstrate about something that people want to see, Facebook will reward you by giving your content more exposure and in tern Facebook will benefit by having people stay on their platform for longer. The same thing with PR in newspapers and magazines. If you have an interesting and unique story, you’re more likely to get free coverage from the newspaper or magazine, because that’s what their people want to read about than the more run-of-the-mill product, will be forced to spend money on advertising.

These two can work in tandem, though much the content that you put in the work and hours for can be there to identify your audience, but then getting a more sales message across is typically where you have to pay for the privilege. You can use your good quality free content to cast the net wide but typically you’ll have to pay to get somebody into a more sales environment. Links that go directly to opt-in pages, or sales pages, or product pages of an e-commerce website, or checkouts, people will typically have to pay to get that kind of traffic. Google and Facebook are getting much better at identifying which clicks are leading to sales, and which are just to content. Just as magazine editors will take away some of the control of your message and push you towards paid advertising when you’ve got a message that wants you to come and buy, but will give you editorial space if it’s more informational. 

That’s how you use the two of those together. The earned media gives you broad reach, helps you identify the people that are interested in your message, and then use paid advertising to get them to the specific sales message. Now, owned media I would say there’s really only one owned media, and that is your email list. You can have a large following on Facebook, Facebook still has control over who you can talk to. You may have people subscribing to your podcast, that’s still really controlled by iTunes, but your email you have much more control over. A large step in all of this is moving people from paid and earned media into your own owned media. Getting them onto your email list where you can then control the pace of the discussion and have one-to-one conversations that are not really possible through other channels. 

You can combine these to give the impression of being everywhere. Once you’ve nailed down who your prospect is and the kind of things that they read, then with a relatively small number of platforms you can be in front of them almost all the time. You can be in their emailing box. You can be in their social feeds. You can be a guest on podcasts, and blog posts, and other things that they’re reading, and you can appear at live industry events that they attend. That’s only maybe four-five strategies that will give you the appearance of being in your market, being inescapable and being entirely bound up in the market place that your prospect deals with. It’s really important right back at the start that you find out, what are the channels that your prospects use? Not just when they’re in work mode, but when they’re relaxing, when they’re just browsing the internet killing time. 

It does mean that you’re also going to have to master multiple formats for your content. It means that as well as writing you need to become more image savvy for platforms like Facebook, Instagram, Pinterest. It means that you probably going to need to master video for Facebook, YouTube, and possibly overcome public speaking fears to deal with joking at live events as well. Whereas one’s checks throughs are primary medium on the internet, it’s not very much become a much more visual place to live. The generation of millennials, if you watch them on their phones, are driven much, much more by visual and particularly video communications with each other than by writing emails to each other, which is what people of my generation are most comfortable with. 

We’ve talked about getting paid clicks to our websites, and really those come in two streams as well, so this is about acquisition and targeting. We have the paid clicks to our website which we use to acquire customers, either as customers or onto our email list. Moving them from those paid and earned media into our own media, but we don’t get these people all the time. We don’t get 100% of the people that arrive on website opting into our email address. We certainly don’t 100% of them purchasing our product, so what we also need to master is contingency and re-targeting. Contingency is, what happens when things don’t go to plan? What happens when somebody visits your landing page and then clicks away again without opting in? What happens when somebody comes to your product page and doesn’t buy? And laying out the content that you need to get a second bite to the cherry is a very important part of making sure you’re not leaving a load of money on the table in your acquisition attempt. 

Re-targeting is much cheaper than typical acquisition campaigns. Although your cost-per-click might be a bit more you’re dealing with a much more targeted audience who have already shown some interest in your product, so going back to them a number of times is usually a very worthwhile strategy. Right back in my direct mail days I was told the maxim ‘six till it clicks’. Which means it takes at least half a dozen contacts with your customer before it clicks, before they understand what you’re about, before they have the trust in you to spend money with you. Laying out that content that you might need to get somebody to come back to your website is very important, and from about objection handling content, and case study content is very in doing that.  

Know your numbers: Measurement, tracking,, sales optimisation

The final thing that the top digital marketers do that most others don’t, is around understanding their numbers and testing different alternatives in their marketing to move the dials on those numbers. Let’s deal with the numbers that we’re tracking first, so we understand those, and then we’ll talk about some testing. The first thing is, that we need to be optimising for sales. The best marketers are not content with likes, opens, clicks, shares, really. They’re looking at how any of those contribute towards sales. Under no circumstances will they look at things like shares as being valuable in their own right, unless they can see a correlation between content that’s shared a lot and sales that come from those.

Actually understanding that whole customer journey from the first piece of content they see with you, to coming inside your environment, your website, opting onto your email list and eventually making the purchase, is one of the biggest challenges that marketers have. It’s a complicated journey. For all our talk of sales funnels, very few people go straight through a prescribed route. They find out about us from references on social media, old content which they stumble across on Google, it’s not the neat planned route that we would like to think it is. Understanding those steps and understanding which parts of it are contributing to sales is the first part.

The next thing is understanding your cost per sale, i.e., how much does it cost you to get each customer from not knowing you to buying from you? There can be multiple costs in that. Somebody clicks on a Google Ad, they come and look at your website, maybe even opt-in to your email address, and they don’t buy. Maybe they see another Facebook ad, click on that, come through and buy on the second attempt. You’ve got multiple costs before you get the sale. I’m always incredibly wary when I hear agencies crowing about having got some incredibly cheap leads for their customers. I’m not interested in the cost of leads, only the cost of sales. I can get cheap leads all day long. I can run competitions, I can run Freeview websites, I can offer giveaways, and get leads for less than a dollar any day of the week. Getting those people to buy is nigh on impossible. 

I would far rather spend more money in the right places where I know that buyers, people who are prepared to take action towards solving their problems live, and spend that money, which can often be $5, $10, and in some financial markets sometimes three figure sums, on acquiring those leads. Be wary of cheap clicks and cheap leads. They’re great if you can get them, but make sure that they’re leading to sales and understand the total cost of sale. Give an example of cheap clicks, low conversion rates, expensive clicks, high conversion rates.

They avoid vanity metrics. We’ve already talking about opens clicks, but likes and shares in particular have become too dominant as a measure of success. It indicates popularity, and as any high school movie will show you, that popularity is not always a measure for the best in the market. Other than sales, some of the metrics that you should be looking at are, your customer satisfaction and the rates of referrals. These are things which genuinely drive sales, which have high correlations to people buying from you. 

When it comes to reviews and testimonials, these are actually quite important because you need to attract the right kind of customers who will leave those reviews and testimonials. Have you ever actually rejected a customer because they know that they’re not going to take the actions that’s needed for success? I’ve done that in service businesses because I know that every time I get a successful customer I usually get a referral, and the ones that done refer me, roughly balance out the ones that refer two or three people. Without a success at the end of a project, I’m not going to get those referrals and my business will stall. I’ve rejected customers in the past because I’ve known that they’re not going to put the work in on their side, they’ve got high expectations but their story at the end of it all will be that what I did didn’t work. Have a think about the message that your customers are putting out in the marketplace about you and those satisfaction ratings and what they will do for you, because they’re a very visible part of today’s marketing. 

The other thing that the better marketers will do is to understand lifetime value. This is bound up very tightly with the comments I made before about the product ecosystem and needing something else to sell to them. Give the McDonald’s maths here. Having spent maybe half of your product price on marketing to get that person in, in the first place, can dramatically increase your profitability when you sell them something else, because it costs far less to get clicks from emails and your own content, your own audience, and get them to buy, than it is to go out looking for new customers. Understanding that lifetime value can create another dynamic in the business. It leads to what’s known in grocery shopping as lost leaders. Lost leaders would be an incredibly cheap product that a store would advertise on its windows, people would go in to buy that and invariably buy the rest of their week’s shopping at the same time. By taking a small hit on the first product, the business would benefit from the rest of those sales.

It’s the same as our story about Jeffrey Doltis losing 20% on his advertising spend but knowing he was going to get that back over the course of the year. What it gives you is the ability to have a far higher cost of acquisition per customer than just your first sale. If you’re trying to make money out of each and every sale, life’s going to get very difficult and people who are better able to take the hit on the first sale and make more profit by selling more product are always going to win this game. It will open up advertising opportunities. It will open up the ability to spend money in places which were previously just not acceptable in their pricing. 

If you know that these are people that you can turn into repeat buyers further down the line, you can beat out the other smaller players in your market who are trying to make a profit off of every sale and can only afford very small advertising costs, of which there is a dwindling number of opportunities. Understanding the lifetime value of your customer and doing everything you can to create more products that will help them, more services that will help them, and build up that value, is a very important strategy that all of the top guys know. It gives you an allowable cost per lead. Rather than talking about cheap leads, have in your mind how much you’re prepared to spend to get a lead. Have a hard and fast ceiling on that. You make great profits when you get cost per lead of lower than your threshold, and you get customers who you can make profit on further down the line. Jeffrey’s allowable cost per lead was about 120% of the cost of his first shirt, because he knew he’d make back that 20% and more later on. 

The last number, it’s really worth keeping an eye on as a small new business, is lead velocity. Lead velocity is the speed at which somebody moves from into becoming a lead that you’ve gathered to when they buy. Our ideal scenario is somebody clicks on an ad and they come to our page, they buy. That would mean our lead velocity is within one day. The reality is that we normally need people to interact with us a few times before that trust builds up. You have a gap between when you’ve spent the money on your lead, on your advertising that gets your lead, and when the money comes in from the sale. How long that gap is, is how fast your business can grow. If you have a lead velocity, which is, say, 25 days, it typically takes 25 days for somebody when they click on your ad to when they buy, you’re in a great position, because the likelihood is you’re only paying your ad expenses monthly, you might be able to absorb those on a credit card, and by the time you have to pay them the cash has come in from your advertising.

Imagine that stretches out to 35 days. All of a sudden, you’ve got a problem. You might be having to pay for your advertising before the cash has come in. It has a big impact on your ability to finance your advertising. Somebody like Jeffrey who knows he’s got a couple of months worth, that’s not a credit card bill, but he can go to his bank and because he can show predictable return on that advertising investment, they will lend him the money to cover that two or three month gap until the second sale comes in, and Jeffrey’s making profit. It’s relatively short term investment. As long as he has enough cash in the bank to cover his monthly bills he knows he’ll get the profit back next month. 

Were the worst to happen and it was going to take him the first two sales to make profit, he still has enough data to go back to the bank and say, “Look, I need some money for another quarter, but it will come back. The business will be slower, it’s not as profitable as it was, but it’s still going to make that money back with predictability. That comes from selling a consistent product to a consistent market over a long period and having that data at your fingertips. It’s something you should certainly be looking at building up from day one, so that as your business develops you can see how you’re improving on those numbers. Talking about improving on our numbers, that’s going to take us onto our next subject, which is testing to improve those numbers. 

Beta Testing

The last thing that we really need to master is testing, which we use to continually make our marketing and our product better. More experienced marketers know that the first attempt at landing pages, emails, products, websites, and anything we do, is never the best that we can do. We’re delivering these right at the start of the project before we’ve really had a lot of feedback from customers. Only putting our website, our marketing, our content out there, in front of our prospects, can we get some feedback that we can then start to improve. 

Typically, testing goes in two rounds. The first round is user testing or, what we call, beta testing sometimes. That’s where we take the first iteration of our products, and our marketing, and we put it in front of some people and see what kind of reaction we get. 

There’s a few ways of doing that. My particular favourite for testing just the marketing finals, so testing out what people think of our ads, our pages, the emails that come out, is a tool called WhatUsersDo. We can show somebody an ad, let them click on it, and they’ll just talk through what they’re thinking about as they go through, things that confuse them, things that make them stop in their tracks, things that make their eyes light up. It’s really good if you can actually get in a room with somebody while they’re doing this, but you do, also, have to be careful of them trying to please the person who is running the test, which is just a normal human tendency.

Now, the really best way of doing this, is to push lots of lots of people through and see what people click on and what they don’t click on, but to make some early changes, getting about half a dozen people to go through [final 00:02:07] and just talk through, particular things that they found confusing, maybe copy that wasn’t clear, bits of the offer that weren’t clear. Once you’ve done half a dozen or so of these, you’ll start to see a few common problems which you can go back and iron out.

The same thing with the course. You really want to try and find those dozen people that I talked about, right back in the beginning when we were talking about getting user feedback, try to get ahold of those people and get them to go through the course. 

This can be a challenge. Lots of people will say that they’ll do a course because they want to sign up for free. They won’t necessarily go through it. What I’ve quite often done is said, “Okay, there’s a bonus if you complete the course,” so they have to do a bit of work for it, and if they hadn’t finished in a certain timeframe, then that bonus goes away. I’ve done things like offering to pay for some WordPress plug-ins to help people build their landing pages. I’ve offered to give them email templates for follow-up after they’ve got … So they get at a certain point in the course and you offer them, whatever maybe the next step is, as a bonus. That will give people the spur to go and actually do it, and then get some clear feedback from them.

What I’m usually asking for at the end is, I say that I want one of two things, either a five star review and testimonial or, if they don’t think the products good enough, then they need to just tell me what they would have wanted me to change about it in order to get that five start review. But normally people are quite positive. They’ll point out a couple of wrinkles that will make it better, and you can see where people are actually getting stuck in the course, where they have lots of questions to ask. 

That’s your beta testing. I would suggest doing that before you really start spending significant advertising sums. 

Once you do start marketing the site and you have some traffic going through, the next thing you want to do is to start running, what we call, split tests or A/B tests. This is taking different versions of your landing pages, different versions of your emails, different content in your webinars, even different parts of your product, and try them out one against the other. 

Your user test will give you more of an idea about what people might be interested in, give you some ideas of things to test. Start with the big things. Start with the headlines, the big offer, proposition stuff. Lots of people talk about testing red buttons against green buttons and really tiny stuff like that. Test big things. That’s how you get the big changes. Once you’ve done two or three big, significant landing page tests with lots of different things to change on them, pick the best one and then try and refine on that big [offer 00:05:14]. Don’t try and work your way up by making small changes, because it will take forever and you might be missing a really big step.

There are tools running those that you can try out different versions of your ads, different versions of your landing pages, different versions of your emails, and all of that tracking that you put in place, to optimise for sales earlier on, will tell you which ones of those are being the most successful.

Ads, landing pages, webinar content, sales pages, email follow up , checkouts, pricing