10 “Million Dollar” Marketing Secrets sleepless nights here? here? Yeah, yeah typical reaction at live live events, which which Bill: Good morning. Do we have some sleepless were very proud of you know. Anything we can do to inflict inflict discomfort discomfort I’m very happy about because give you an opportunity to think about your business and to look for things to take back in order to implement right away. And what’s what’s really really amazing amazing after after we do these types types of events events the kind of feedb feedback ack that that we get, get, Bill, Bill, implemen implemented ted just one idea I learned learned there that put an an extra extra $600,00 $600,000 0 in my bank bank accoun account. t. Wonderful Wonderful to see see that. that. And who who here would like to know the 10 million dollar marketing secrets to instantly transform any business or sales career? Mr. Kennedy continues continues to amaze me. me. Every time he puts puts together one of these talks I’m in in the back of the room glued to my chair figuring out, trying to get every word and then I go back and listen to them over and over and over again, which also reminds if you haven’t yet done so you can get the CDs of this entire day and half for I think just $97 $97 dollars. So if you haven’t filled filled in that form then do so. Your about to hear those 10 million million dollar marketing marketing secrets. So Mr. Dan Kennedy…
Dan: Morning. CNN reported this as a true story a handful of years ago. I’ve since been told by some people it is not a true story. It does negate my love for the story so I prefer to continue to believe it’s a true story. And after all if CNN reports it it’s got to be true right?
So this was on CNN some morning, I forget the city I was in. And as a speaker I found it entertaining. In Europe they still have the classic three ring circuses where there’s something going on in all three rings. There’s a main act in the the middle. There’s a side act over here. And there’s a side act over over here. So you know the trapeze artist might be in the center ring at the same time as the lions over here and the clowns in the clown car over here. So there’s this circus performer in Europe, Franz the Midget, who has been, his family’s been in circuses. He was born and raised in the circus and he’s been a circus performer for some 30-years and his act is a trampoline and trapeze act. And because he’s so small and dense, the little little guy, he can get going on a trampoline and he can shoot himself like way up in the air and catch a trapeze and swing back and forth and drop back down on the trampoline and go sailing even higher up in the air. So that’s his act. So he’s over in the side ring ring on one side. There’s something going on the main ring and over in the side ring is the hippo act where the hippos get up on bicycles and stuff. So Franz is over here doing the same thing he’s been doing day in in day out for for 20 20 some some odd odd years years doing this trampoli trampoline ne act. act. And just just about about the time time you think think you’ve done something so many times that it’s like impossible to screw it up…so he’s doing his deal and he’s getting higher and higher and higher and he comes down and he like misses the middle of the trampoline and he hits the edge and he flies up, his mouth flies in an arch instead of straight up and he flies over the center act into the open mouth of a hippo.
Now the hippos are used to be being thrown fish as rewards. So the hippo gets up on a box, he opens his mouth and the trainer throws him a big fish and he swallows the fish whole. Well Franz coming in at about 35 miles per hour feels to the hippo like one big fish and he swallows him whole. So Franz goes from trampolines through the sky into the hippos and down the hippo’s throat. The circus people of course rush, grab the hippo and rush the hippo off stage behind, a veterinarian but it’s too late. So Franz has died in the stomach of the hippo. Now the two things that immediately occur to me neither one is sympathy for Franz by the way. But it’s just how I think. That actually didn’t occur to me for hours but the two things that immediately occur to me are number one like any time you like think your having a bad day doing whatever your doing, I mean, this guy gets up does the same act he’s been doing for 25 years. By now nothing could go wrong and this guy, I mean, he gets eaten by hippo. So I mean whatever is happening to you in your office or your sales calls it’s nothing compared to this. I mean how do you even call the relatives? I mean what does that call sound like? The second thing that occurs to me as a performer, somebody who puts on events is the massive problem you now have with your word-of-mouth advertising because see the audience thinks they have just seen the greatest trip in the history of circuses. This is like incredible. The guy sails through the air, goes into the mouth of the hippo and disappears. I mean this beats the two guys with the lion in Vegas. This is real magic here right? So they are all now going home at night telling everybody you’ve got to go to the circus before it leaves town because this thing, the midget, the hippo he disappears. It’s incredible. So what do you do now? Do you try and find a midget a day? I mean exactly how do you deal with this marketing/public relations problem? This was my reaction to the CNN story. It has absolutely nothing to do with what were going to do here this morning by the way. I just thought it might loosen you up. So something that does have to do with what were going to do today. You all probably know this story but it was a starting point from the…I mentioned it yesterday, in the way I approach things and the story is that on the proverbial dark and stormy night in 1917 specific date has long escaped my memory a young writer, Napoleon Hill, has gotten an interview with Andrew Carnegie, possibly America’s first billionaire. There’s some dispute about that but certainly one of the first billionaire’s in America and Carnegie takes a liking to him and essentially hands Hill a pet project that Carnegie has had in mind for some time. Carnegie believing that there is actually set principles of becoming wealthy and successful that can be cataloged and learned and taught and that somebody ought to compile them all. And so basically Carnegie says to Hill, “I can open every door. I can call everybody. I can get you in to see everybody who’s anybody who’s achieving great things in our society if your go spend whatever time it takes to go interview them all and figure out what the commonalities are.” The things that they all do alike, not the things that they do differently and put it together in some kind of an encyclopedia and I’ll make the contacts for you.
And there’s a lot more to that story but that was the set up for them 20 years at work by Napoleon Hill but spawned, well the encyclopedia was called Laws of Success but then the book Think and Grow Rich, which really is a condensation of Laws of Success. And so Hill spent 20 years going and spending time with and interviewing Henry Ford and Thomas Edison and Heidi Firestone and the list is long and long and long and long. And the frame that Carnegie gave him was the important frame and I mentioned it yesterday and that is that the differences amongst all those people just like the differences amongst you. The differences between Sam Walton and Donald Trump, the differences don’t matter although the differences are what are abundant. The only thing that matters is the very few things that they might all do alike or least similarly the very few things that they might all believe identically or similarly. And so Hill spent 20 years looking for those things and ultimately cataloging 17 of them and I’m sure you’ve read it. The same approach has been taken again and again and again over the years. Tom Peter’s original In Search of Excellence book was essentially Think and Grow Rich about companies. What do these great companies have in common? It turns out that picking became a little more difficult and so if you go get In Search of Excellence today unfortunately about five of the excellent companies are now non-existent companies and so they were excellent only briefly, which is a whole other topic of conversation. But still the process used was the same. Gene Landrum’s work which is not as familiar to a lot of people but if your not familiar you should look him up GeneLandrum.com. Gene’s work in the behavioral psych of highly successful entrepreneurs is the same approach. They round up a bunch of them and put them under a microscope and interview them and talk to their mothers and their sisters and the people who work with them and try and figure out what are the five things or the seven things or the 12 things or the 14 things that they all do alike? The same approach has been mine but unlike all of what I just described to you is fundamentally, academic research meaning through anecdotal evidence and interviews and observation only we draw conclusions. My work I’ve had the great benefit of being immersed, for more than 25 years, in hands on work with people who are, for the most part, first generation rich, meaning they didn’t inherit the money. They didn’t the start with a pot of money. In many cases they started with little or no money or a negative pot and made their money through entrepreneurial and marketing and sales efforts. And my private client base over the 20 some odd years has included about 250 now, 270 people who fit that description. So they’re first generation. They’re from scratch. They started some kind of business and they went fundamentally from zero to a million dollars a year plus incomes and multi-million dollar a year net worth’s through their own entrepreneurial efforts. And rather than just interviewing them after the fact I’ve been working with them like from when they started with the real small pot to when they now have a real big pot, working with them when they done consulting work for 20 years for…two guys for example who started a company that did $10 million dollars it’s first year and last year did $1.6 billion. The other commonality is a lot of my people do it fast. And so it’s quite common for the people I’m working with to have the zero pot today and have the million dollar income 12-months from now, not 12-years from now. So same process of observation but observation from inside and as they went rather than observation
from outside after the fact. And by the way interviewing people about it after the fact, sometimes they don’t remember or choose not to tell the true story of exactly what they did in order to get what they are. It’s called revisionist history and so we tend to change that story to make us sound better or more interesting or more palpable or more acceptable. And so if you will my research that led to the Renegade Millionaire System, which is roughly $500 million, $600 million dollars worth of people’s achievements that led to everything that’s in my Renegade Millionaire System was hands on, in the trenches, armpit-to-armpit with them, figuring stuff out and applying it as we went along. Many of these clients, by the way, have been with me continuously for 10, 12, 15-years and so we’ve been together from their beginnings to where they are now. I don’t mean to discredit Hill or any of the others. I just make the point that it’s different. Now the commonalities, and were only going to talk about the marketing related ones today, of the commonalities all of what I call Renegade Millionaires have again this handful of things in common. They have many differences but they have a handful of things in common and these are the categories of the commonality that I talk about a lot in the system. So, for example, they have all have a particular philosophy. They have a world view, a view point that is very different from the masses, from the majority of folks. Were not going to talk about that all today. The other ones we are going to talk about is how they defy industry in the [inaudible], their overall approach to marketing, which again is very, very different from just about everybody else in their businesses, how they approach turning ordinary businesses into extraordinary businesses and how they change the way businesses are done in their category. So within that framework we’ll talk about 10 big marketing breakthroughs you can borrow from them that are their commonalities that you can apply to your business and that you can get some spectacular results from. So number one is that they turn ordinary businesses into extraordinary businesses. Now what does this really mean? It means that most people approach business and even come to a seminar like this with incremental improvement in mind, meaning I’m in a coffee shop business. How can we get more customers into the coffee shop? How can we compete more effectively with the coffee shop across the street? Can we inch up our prices by a dime? How can we get more people to buy two donuts instead of one donut? They approach it from an incremental improvement standpoint. The folks I work with approach it from a very different standpoint. How do we take this ordinary business and make it something entirely different than what it is now? Although it still sells coffee that is infinitely more profitable and has unique competitive positioning and so forth. Changed the entire business. By the way the most common thing, and some people who’ve had the experience, the most common thing that I hear when I wined up doing one-on-one consulting with clients is that I got here at 8:00 in the morning thinking I was in business ‘A’ and I left at 4:00 in the afternoon now in business B-C-D-E-X-Y and Z. The complaint attached to that is Dan you’ve created a whole lot of work for me, which is like my best skill. So if you approach your business with the question of how can I make it better, how can I make it more
profitable? How can I increase its sales? How can I make it bigger? I submit to you it’s the wrong question. Because the questions themselves have limitations. The questions themselves have an incremental improvement mindset. I have a client right now, very large company that, also a very dysfunctional company, which somewhat goes together. I say the bigger they are the dumber they are. And big companies tend to get bigger and bigger and bigger and dumber and dumber and dumber until they’re like this giant dinosaur that can’t get through the woods anymore and it’s bumping it’s head on every tree and very slow and ponderous. And it’s sort of where they are but what they said to me at the beginning of the relationship is, “Were doing 30% better than our next closest competitor in our category.” And I said, “Yeah.” But they dysfunctional too. I mean it’s like bragging about being the world’s tallest midget. You still got to wait for somebody else to push the elevator button if you want to go to floor five. So you don’t want to be comparing yourself to that. You want to be looking, for example, at what should I market share be, what could our market share be? Not, “Oh were doing 30% better than these other idiots.” Also we take comfort in the fact that they’re more dysfunctional, screwed up than we are but that’s how a lot of people approach business. We don’t approach business that way. So some of my favorite examples are Disney and Starbucks. I mean Starbucks imagine being in the meeting. Imagine being in the meeting where everybody gets together and says, “Here’s what were going to do. Were going to sell coffee for $8 bucks a cup and were going to sell it in paper cups that are so thin. Well we got to give them a little paper wrapper to put it under so they don’t burn their fingers. And were going to put a bunch of really slow kids behind the counter so they got to stand in line a long time to give us the $8 bucks so they can enjoy the ambience of the European bistro environment were going to create. And were going to complicate the menu so much that just to come in and order [inaudible] were going to create. You need a degree from MIT. You need to take a memory course and it may take you a half an hour to make the decision. And were going to open so many of them that you literally can walk out of one, cross the street and walk into the other. “In fact our goal is to get the point to where were opening Starbucks in the men’s room’s of Starbucks.” Now get out your checkbook and invest this puppy. Imagine being in the meeting. You’re going to do what? It’s coffee. And imagine now being in the meeting at say the big dumb company Dunkin Donuts when they see these guys start. Can you imagine this? Everybody is like walking around celebrating the morons over at Starbucks who think they are going to get people to pay $8 bucks for a cup of coffee. And they’re still befuddled. I guarantee you their meeting yesterday was, “We got better coffee.” And they do but they don’t get it. See it’s not about that. So Lynn’s in the coffee shop business but Schultz’s only like barely in the coffee shop business. That’s clearly not what Starbucks is about. You could spend hours talking about what it is about but we could all agree it isn’t about getting a cup of coffee because clearly there’s a lot of places you could go faster, cheaper, better to get a cup of coffee. Dominos, that other favorite of mine, Monahan. See it isn’t about the pizza. Everybody’s got, you
know…Dominos originally ESP was fresh, hot pizza delivered in 30-minutes or less guaranteed. It didn’t say anything about good pizza. Well there’s a reason for that. Well what? Everybody knows you can get better pizza anywhere in America. Will that be in Chicago? I mean you can be in a middle of cornfield in Iowa, there’s a better pizza available than Dominos. They just started their 10,000th store. He reinvented the whole business because he made it about the delivery and the delivery time, not about the pizza. Everybody else get in the pizza business they’re also talking about the pizza. They’re all having meetings talking about our crust is better than this guy’s crust and we got a better recipe. And I said, “No, no, no, no. Let’s just…,” and by the way brilliantly, something people don’t know about Dominos, all the original locations beginning with the failing one that he started with, were around college campuses. So the deliver ESP was really cool because you got a lot of people in them dorms who have smoked a bunch of funny stuff. And at some point in time they are desperate for carbohydrates. They are completely incapable of going out and getting any. They want them fast. They could care less about good. Very capable of discerning good. The guy pulls out of the kitchen cabinet, sits on the floor, eats the box of Corn Toasties and the box. So it doesn’t make any difference. So the 30-minutes or less was perfectly matched to the market. Well that’s how you take an ordinary business, an ordinary mundane business in a saturated cluttered field. So when Howard Schultz’s started Starbucks was there any place in America that there was a shortage of places you could get coffee? Everybody’s sitting around saying, “Man we're 500 miles from coffee. I wish somebody would open up a place here we could get coffee.” When Dominos started was there any place where there was a shortage of pizza? Everybody’s sitting around saying, “Oh my God, you know I haven’t had a good pizza in 30 years because you can only get one in Chicago and Italy. If only here in Cleveland there was some place we could get a pizza.” It’s the biggest section in the Yellow Pages, biggest one. Pizza, [inaudible]. Those are the two biggest sections. So there wasn’t any shortage. It’s mundane, ordinary business made into an extraordinary business. Not an incrementally better business. That’s a big shift in thinking. I have a quick list here of some people in our group that demonstrate the principle in different ways. Two people in the restaurant business who are both clients of a client of mine, Rory Fatt at Restaurant Marketing Systems. Rene Norris has a kind of restaurant but in a very small market, very small. Diane Kotu has a pizza place that isn’t even dine in. It’s take out or delivery. It’s gourmet pizza. Now here’s what the two of them have done. They’ve implemented continuity in their restaurants. Continuity meaning [inaudible] big money. Those of you who are Inner Circle members are very familiar with this concept. You just wouldn’t expect to find it in a restaurant. I forget Rene’s numbers. I know Diane’s. You join the club and then on the first day of every month you get your credit back for $29.95 until, unless you say, “Don’t do that anymore.” And you get in the mail $39.95 worth of coupons that could be spent during the
month on different and sundry products at different and sundry times all incidentally requiring you to spend more money in order to use them. You get the newsletter, which really the business should send anyway. You get some special offers during the month that are for members only and you get a special phone number, this is the Disney shorter line plan. You get a special phone number that’s for member’s only so that like at peak times when everybody’s trying to get a pizza…so like Super Bowl Sunday the regular line, of course everybody’s getting a busy signal. So you can use the member’s only line and wait in line for a shorter period of time during the busy signal in order to get in, in order to order your pizza. That’s what you get for $29.95 a month. Now if there’s 200 members there is $6,000 dollars a month of income on the first day of every month before a pizza oven has been turned on, a box has been pulled off the shelf, a piece of crust has been made. That’s $72,000 a year of locked in, automatic income before anybody sells or delivers a pizza. Furthermore it forces everybody because now they’ve got these coupons they’ve paid for to spend money all month long. It increases their frequency of purchase. It increases their repeat visit. It increases word-of-mouth advertising because they can’t use other coupons so they give some of their coupons to somebody else. So really the coupons don’t cost anything. None of it cost anything. The $6,000 dollars a month is 100% net. So there’s $72,000 dollars a month of 100% net created in this business that yeah it’s a restaurant but you understand it’s no longer an ordinary restaurant. It’s really about something very different than an ordinary restaurant. Rene who has a banquet room in her restaurant sells now the memberships in her club, which she has two levels, the way I sell product from the front of the room to you. She invites people into the banquet room in a group or does a group presentation and sells them all in the restaurant business. This is how you turn an ordinary business into an extraordinary business. You leave the core business there, okay were in ‘X’. But now there are a lot of radical things we can do that nobody in ‘X’ would ever dreamed up. Paul Johnson and Bob Higgins was here. Bob’s in a painting business and Paul was in the back yard shed business. You can’t be any two more mundane, boring, ordinary commoditized…pick something. I mean a back yard shed. If you go over to Home Depot or Lowe’s there’s a bunch of them sitting out in the parking lot on skids that you can buy to take home and put up and you can buy them pretty cheap. Paul’s sheds are selling for roughly the equivalent of a room addition. And he’s in northern California. They’re selling for as much as $20, $25,000 dollars for a shed. I think the average sale price is about $8,000 bucks. It’s a shed. But what’s different is the marketing. And so for example somebody calls up any other shed company and says, “Send me some information.” They send him a price list and then they send him a little crappy tri-fold brochure with little drawings of their sheds in it, the specs. Paul sends a DVD that is a half hour show room aid interviewing happy people in their back yards with their sheds showing what they’re doing with their sheds. And one person has it as their doll house because they always wanted a doll house when they were a kid and their parents would never give them one, so now she’s got a full size dollhouse. It’s a little creepy but…
It’s not like I was going to date her just there to shoot the show. There’s a book that goes in the package which is all stories of shed shovers, shed lovers. We call it…got new glasses now my teeth don’t work. So this is like the book of Chicken Soup for the Shed Lover’s Soul and it’s these big emotional stories of these people who are, who say, “We got out of this shed business. We got into the emotion business and we made price irrelevant. Doctor Charlie Martin was on my list, he’s a cosmetic dentist in Richmond, Virginia and Charlie’s average case size last year was over $35,000 dollars. His biggest case I think was $112,000 dollars last year. You could go into any dentist in Richmond, Virginia, probably any cosmetic dentist in Virginia, quite possibly any cosmetic dentist in the tri-state area and get quote ‘the same work’ unquote done for 30 to 50% less. Now the first requirement to set across the desk from a patient and quote a $70,000 dollar fee is the same requirement the copywriter fees. It is the ability to maintain a straight face when you quote the fee. But you have to go practice that in front of a mirror. It’s a thing you don’t take for granted. It’s the same skill that injury lawyers have when people come into the office and five members of the family have been hit by a train and they’re telling them the story of how the lawyer has to go into the men’s room, lock the door in the sound proof room and go, “Ca-ching.” He can’t do it in front of the client because it follows them. So there’s a certain thing you want to do with your face. But beyond that I don’t think; now Charlie is a very good dentist. He’s an outstanding cosmetic dentist and I’d go to him as my dentist. I get on an airplane every time I go to the dentist in order to go there. And I hate getting on airplanes. But I don’t think he’s a 100% better than the next closest cosmetic dentist, I doubt it. But his practice is an extraordinary business. The way the patient is handled, the environment from the grand piano playing in the lobby when you arrive to for the female patients, the paraffin treatments, the massage chairs, the on and on and on and on. I mean how do you know you’re in a dentist office until the first time, you know. Painless dentistry by the way means it’s painless for the dentist. Bill who spoke to you yesterday, so I won’t be labeled the point, but see by the time he got done with the meetings, with all the marketing for his menswear stores the only thing they had in common with every other menswear store was they happened to sell men’s clothing. But the business wasn’t about that. The business was about by appointment selling. The business was about direct marketing. Now the remaining story of the business is about a membership that people have to pay for the privilege to be able to come in and buy things. Darin Garmin, I’m going to talk a little bit more about Darin but Darin’s an interesting guy because he’s a, fundamentally a commercial real estate broker in the middle of Iowa. He sells apartment buildings and commercial properties in Iowa, which is probably the least exciting place in the world that you could be selling real estate. I mean like Vegas, Florida, high rise condos, water, 400% appreciation, celebrities, Florida real estate, 80% of which he is selling to investors from California, Florida, Las Vegas, Tokyo and last year 73% of every commercial transaction in his marketing area went through his office.
Why ordinary business to extraordinary business by going from local to national, by selling what it is that he sells to people from outside of his market area instead of those inside his market area. Everybody has some kind of rule about their business. All of our customers come from four square miles around our place. Everybody always tells me their rules. All of our customers come from four square blocks around our place. All of our business comes from within our city. All of our business comes from within this demographic. Well that’s how you keep an ordinary business and make it incrementally better. You figure out how to get a few more of those people within that four square blocks and do business with you. And you figure out how to stretch the four square blocks to five square blocks. But if you figure out how to stretch the four square blocks to the globe now maybe you can do something. Don’t have time to talk about Al. Second big idea – define industry norms. Now I’ll tell you something about this, not only do the most successful people I work with defy them, they take a perverse personal joy in doing so. So not only does it have practical payoff, there’s a certain psychic satisfaction from driving everybody else in their industry, profession or niche stark raving mad, befuddling them, having them aggravated. These people take a perverse joy in this. But here’s why it’s so important to any industry norms. Here’s what conforms to industry norm’s guarantees – average results. Because industry norms are all based on the average, the median, what does everybody do? So here’s how everybody gets in a business by the way. So whatever business you’re in here’s what happened when you got in. The same thing that happens if you’re in junior high school or high school that you transfer from one school to the other. You spend your first few weeks looking around to see how are things done around here. What do the cool kids do? How do I conform in order to be accepted? That’s what everybody does when they join a business. So when you got real estate and you got in dog grooming or you got in whatever it is you got into you pay attention to what everybody else in that business was doing and you made a point of conforming. Every real estate agent in the office has their picture in the top left hand corner of a business card. Guess what your business card looks like? It’s got the picture in the top left hand corner of the business, business card. And if you get in ambitious about making that better you get a better picture. You don’t decide, “I’m not even going to use business cards. Screw them.” So that you don’t think about that. You just think about, “How can I make the business card better.” Not, “I’m not going to have a business card.” I haven’t had a business card in 25-years. Everybody always ask me for a card. I say, “I don’t have a business card.” When I spoke with Zig on the tour always be a clump of people afterwards and I would always offer product because I [inaudible]. And so there’s a couple of people afterwards asking questions and there was always a couple pushing their card at me and can I have your business card? And I say, “I don’t use business cards.” Huh? I don’t use business cards. I haven’t had a business card in 25-years. How am I supposed to contact you? I said, “Well you just heard my best 90-minutes. It’s the best I got. You got a chance to get the lowest price thing I offer. If after my best 90-minutes you’re not going to get the lowest price thing I offer to start a relationships why on earth do I want you contacting me and clogging up my office later? That’s why I don’t use business cards. Well seriously that’s why I don’t use business cards. Now about half the people walk away shaking their heads, you know, thinking I’m an idiot and the other half walk away PO’d
and offended and irritated but see everybody’s got a business card. What do you mean you don’t have a business card? How could that possibly be? I know tradeshows have business cards. [Inaudible] business card. No I don’t use them. I’m going to make you write it down on a piece of paper. It’s like a test. Because if they can’t manage to follow-up with me without me giving them a business card I don’t want them as a vendor because they’re going to screw other stuff up later. Let’s find out first if they can follow these instructions before they try to get them following instructions when I’m giving them money. Let’s try this one all right? That’s all it is. So industry norms. Everybody who makes a lot of money defies them. Everybody who makes average money conforms to them. In fact if you want a good exercise here’s a great exercise. Here’s a great strategy – here’s a take home. Go home, get a pad. If you need help get some of your employees or your peers or your buddies together and make a master list of everything that is an industry norm in your business - how things are priced, how things are sold, how things are delivered, how things are advertised, how things are marketed, what contracts are used. Just try and identify and isolate and annunciate every industry norm that people in your business conform to. In most businesses you should be able to compile a list of hundreds of items. Then try and figure out how you can defy as many of them is as humanly possible. You will transform your income in direct proportion to the number you manage to violate. I’m deadly serious. I’ve done it all my life. Started in advertising business. The norm in the advertising business, here’s the industry norm, the norm in the advertising business, just had a conversation the other night with somebody from Sache and Sache about this who’s still doing this after 20 years trying to break him of it. He went onto the advertising businesses, company calls up and says, “We’ve decided to change agencies and we need some new advertising and we need some new marketing.” And they tried like 30, 40 different ad agencies and marketing guys and copywriters through there and then everybody does presentations on spec, meaning for free everybody goes back and creates ads for this company and then they all come back and show them to him. Some of him who are really smart then keep the agency they got but take the best ideas from everybody’s free work and hand them to the guys they already got. But everybody else works for free. I did it once. I said, “I don’t like this.” I kind of was planning on getting paid. So my norm immediately became - here’s how a new client relationship begins. You come for a day of consulting. You pay a fee for that day. At the end of the day if we go forward with project work the fee for the day applies to the bigger for the project work. I don’t do free lunch. I don’t do free breakfast. I don’t do free phone. I don’t do free anything. You pay. You come. You pay currently $12,800 dollars essentially for a full day sales presentation so that I can figure out what you need and sell it to you. Now this is unheard of in advertising. And immediately everybody says, “Well you may be able to do that with entrepreneurs but you’re never going to be able to do that with corporate clients.” I don’t like corporate clients but I’ve had lots of Fortune 500 clients over the years. I sat in a boardroom at Weight Watchers, they were owned by Heinz, and they had their ad agency there. They had two other ad agencies doing a bunch of stuff on spec and they had me who they were paying $9,000 dollars
to be in the room. And the other ad agency folks found out about it they were like, one of them comes to me in the restroom and he says, “I don’t understand this. How are you getting paid to be here?” I said, “Because I wouldn’t come if I wasn’t getting paid.” Well then he says, “That’s not the way things are done in the advertising business.” Get it. Get it. He’s not the only guy in a men’s room today saying, “That’s not how things are done in our business.” But I’m the one with $9,000 dollars in my pocket. You’re the one working for nothing. Maybe mine is better. All right? There are two great examples. Ben McGowan who started MCI. When Ben McGowan started MCI there was a belief in this country, a law everybody thought, that long distance telephone service was a monopoly granted by the government to AT&T and the Bell companies. So no one ever tried to get in the long distance business. McGowan said, “Show me the law.” I hear all the time from clients, “Oh we can’t do that, it’s against the law in our business.” Nine out of 10 times I say, “Show me the law.” There is no law. There’s a belief there’s some nitwit trade association somewhere who’s telling them, “This is the way things are done in our business.” But there isn’t any law. Then McGowan said, “Show me the law.” And nobody could find the law in a week. He said, “Were getting in the long distance business.” Initially the FCC called up and said, “You can’t be in the long distance business. We got that deal with AT&T and the Bell companies.” Well show me the deal. Nobody could…they didn’t have a deal. But I’m staying in the long distance business. For better or worse revolutionized the telephone industry. Here’s some quick things. I’ll mention a few clients and I’ll mention a few things. When I started doing a lot of work in chiropractic in the late 70’s teaching marketing to chiropractic, prepaid was unheard of. Prepay means that when you come into a chiropractors, how many of you have been to a chiropractor? How many are chiropractors? Got to be a few. Okay. No offense intended. You know I love you guys. I wouldn’t be up here without a chiropractor. I’m serious. But so the chiropractic drill is you go to the chiropractor, they take some x-rays and they fill around with you and then they bring you back and they put the x-rays up on a light box and they show you how your spine’s falling out. And you got to come in 14 times a week for the first three weeks and nine times a week for the next 62 weeks and twice a week for the rest of your life deal or you spine’s going to fall out and pretty soon your going to be crawling around on the ground like an ameba. That’s called, by the way, the report of findings. That’s what that’s called in chiropractic language. And then here’s where the whole thing falls apart. Then most of them say to you, “Let’s schedule your first appointment.” And you come and go as you please fundamentally. So you pay as you go, you show up, you don’t show up, everybody’s got a bunch of missed appointments. You got an appointment, you don’t show. Everybody’s chasing you. Well, you create a prepay. Prepay is...chiropractor says to you, “You got to come in 46 times a week for the 14 weeks and that all totals up to $18,642 dollars. You can take care of that by
prepaying it or you can pay it in thirds. Which would you like to do?” At the time you would’ve thought we had proposed branding the Bible. I mean it was like people marching with torches to stop prepay in chiropractic. It became a norm. It became a norm. The people who got good at it could take a practice that was doing $10,000 a month and go to a $100,000 dollars a month in a month. It’s only 10 sales. It isn’t that big a deal. There’s magic in transaction size and incidentally better now, better for the doctor, better for the patient because guess what? When you prepay $18,600 bucks you tend to show up. You tend maybe actually do those exercises they give you to do at home every morning because I mean I gave the guy eighteen-six. Maybe. Maybe I should pay attention. Closed door medical and dental practice. Those are becoming common. It’s going to change the whole health care system in America. It’s having such an impact the AMA is having meetings now trying to figure out how to get it outlawed because it’s not democratic. You shouldn’t actually be allowed to say, “I’m only going to take 120 patients and I’m going to hand pick them.” Because what about Barbara who doesn’t get to be your patient? That’s the AMA’s current position by the way. They’re racing to try and figure out how to make this law because these things are catching on. And the way a closed door practice works is you have to pay a fee, $3,000, $5,000. I have one client he charges each patient $15,000 dollars a year to be allowed to be a patient and he only takes a hundred. And now he’ll actually spend 40-minutes with you. You can actually get him. He’ll actually go to the hospital and make sure they don’t kill you if you happen to be in there. That’s a very useful service by the way. Continuity versus subscription. Core thing in our business, now spreading to all kinds of other businesses but see in the newsletter business if you get other newsletters most newsletter companies, even the successful ones are still clueless about this. They’re still actually selling you a two year subscription and then trying to renew you with another duffle bag and another 46 pieces of direct mail. See we get you once and we just charge you for life. There is no renewal when you do continuity. It changes everything. Some folks on my list. Tracy Tollison is here. I don’t know if…all the way in the back. Tracy’s in the back. Tracy’s a mortgage broker. He deals only with realtors. That’s the first defy industry norm and most mortgage brokers by the way will tell you they [inaudible] with realtors, and they are but he deals only with real estate agents. Turns his cell phone off everyday at 5:00. Won’t talk to a borrower until they have been prescreened by the agent and explained how you do business with Tracy. And most importantly doesn’t take any calls, doesn’t return any calls, doesn’t check any e-mail, doesn’t communicate with anybody in any way over a weekend. Now real estate agents are sitting at open houses over the weekend. They have in their head if they got a hot prospect they got to like get them financed like right now. Everybody’s got a jump through hoops right now but he’s trained his real estate agents who all have to join a club in order to be allowed to do business with him, how to do business with him in a way he wishes to do business. Everybody in the mortgage industry will say you can’t do it. But in fact we’ve proved that we can. Don’t have time to tell you the rest of the stories.
Number three – positioning. Positioning is simply about you have to stake out some territory in the market place that you can own. My Renegade Millionaire clients look for a piece of space in the market that they can own. Sometimes they have to completely reinvent their business in order to do it. My favorite current reinvention story, the big example, is Subway. I admire them immensely for pulling this off. They have managed to take a fast food place and make it a weight loss business. They are actually showing people giant loaves of bread. Huge loaves of bread dripping with some kind of sauce and convincing people they’re running Jenny Craig over there. It’s incredible and brilliant. Didn’t occur to them, by the way, you know the kid went to them. They didn’t find him. So don’t give the big company too much credit but at least enough credit to think about it when they saw it. They’re in the weight loss business with four of them sandwiches for $12.95 if you buy them before 4:00 on Sunday. So yeah Jared’s like eating the little four incher one. See I don’t see too many people eating them. I see them going in there buying two of them big hunkin ones and eating both of them. With two bags of chips and two 412 ounce Cokes. They ain’t exactly the Jared Plan. But think about it, they put, they’ve staked out territory. None of their competitors have and now it’s extremely difficult for any of their competitor to get into it with a radical position in the pitch. For years the lingerie business was all about Fredericks of Hollywood and 90% of the customers were men and 10% were professional exotic dancers. Regular women didn’t buy the stuff. Fredericks of Hollywood’s entire marketing approach did not appeal to most women and in fact most guys gradually discover it’s not even particularly welcomed as a gift. One of two things happens – it goes into a drawer and disappears into a black hole and you never see it again and at some point it dawns you, “Hey what happened to that. It’s gone.” Or you hear, “That’s a gift for you, not for me.” That’s in the wife play book. It’s on page 12. Victoria Secret came along and repositioned the business to be pleasant and acceptable and palatable to women. Now they’ve screwed it up lately. Their sales are suffering and now they’re trying to fix it. Here’s what they did. Look at the stupidity of this. To incrementally grow their business they’d go hire people from Fredericks who come in in Frederick’s eyes, Victoria Secret. Now that’s no good. The whole plate was that it wasn’t Fredericks. And all the women know exactly what I’m talking about. So they created a different environment. They created…the catalogs look different. The stores look different. The presentation looked different. Different position, same position, different position. Carnival Cruise Lines is a doing a great job right now with an advertising campaign to make cruises not about
old people with walkers. Because typically that’s the cruise customer, historically the cruise customers been save up my money for my entire life and then take the cruise of our life and everybody’s in a walker. Some have actually surprised me; they have buffets because it’s like difficult you know. However this is true because I saw it on a Celebrity Cruise. I don’t know where they got it but it’s apparently a common problem. I saw people with a tray that clamps on the front of the walker that they can put the stuff on and then push their walker over to the table. I didn’t know it existed but I made a note because at some point in time I’m going to want to eat too, you know? But Carnival’s doing a great job repositioning the cruise with the jump off the boat, use the jet skis, climb the rock wall, take an adventure. They’re trying to carve out a different place in the market. Here’s some of the ways you can do it – there’s a long list. In my Renegade Millionaire System there’s 52 different ways to position or reposition a business. Sometimes you only use one, sometimes you stitch them together. Here are a few good quick examples. Bill Hammond is a client of mine. He’s been a client of mine for years. Bill is an attorney and I always; I typically don’t like to work with him. First of all I feel guilty about helping him. And…but we had him in my coaching groups, in seminars I always say like…in one of my coaching groups for two years we had three of them and they all sat together because no one wants to sit with them. But still he’s…of all the attorney’s in the world he’s like one of the least offensive. Bill’s positioning is what I call extreme specialist meaning there’s a category in law called Estate Law, which attorneys typically deal with doing estate plans. Then there’s sort of a related small sub-section category called Elder Law, which has come about kind of in connection with the baby boom generation becoming elder. So sometimes Elder Law sometimes includes estate planning but it also has to do with Medicaid issues and nursing home issues and all that. He’s created a sub-section of a sub-section of the sub-section and his law practice is Alzheimer’s family law. And so it is only working with families who have had that elder in the family who either has been diagnosed with or who they believe is soon to be with Alzheimer’s and all the stuff you’ve got to do, which is essentially Medicaid planning, nursing home planning, wealth rearrangement, estate planning, it’s all the same services that are over here provided more generically but they become worth four times the few when they’re positioned as coming from an extreme specialist. Ron LeGrand who you’ll have an opportunity to hear tomorrow, it all becomes a blur to me. Ron one of his great positioning in the get rich in real estate role, which those of you who are from southern California, and I know there are some here who are driving back and forth from southern California, there’s like what 10 get rich in real estate seminars a day in L.A.? I mean flip the dial. I mean while I was getting dressed this morning Bob Allen’s infomercial’s on one channel. This guy’s infomercial’s on. Russ Whitney’s on another one. You don’t see Tom anymore, the guy in the hot tub with the babes in the bikini because he’s in jail. And they have a rule about running the show while your away but it’s a very crowded, cluttered field right? And so Ron’s positioning in the field brilliantly has a lot to do with what he’s not about. That’s a positioning device. Rather than talking about what you are, you talk about what you aren’t. So Ron, for example, is all
about quick turn real estate which means he’s not about buying and holding it. He’s not really talking about the real estate business. He’s talking about the cash business. The last thing he wants to see anybody do is like own it. It’s like barely touch it. So his positioning is what he is not about. Reverse of norm is another positioning technique. I have a Platinum member who’s doing very, very well in another crowded category, the sale of information, training, coaching, etc. to single men who need to know how to connect with women. In case you didn’t know it this is a very crowded, cluttered field. There’s seminars just like this, $3,000 dollar seminars, $5,000 dollar seminars, people fly in for $15,000 dollars coaching. There are books, there’s tapes, there’s famous gurus, there’s websites and all of the positioning is how to pick up women. It started with a guy by the name of Eric Weber from southern California some 25 years ago. All the positioning in that industry one way, shape or form is how to come up to you and convince you to do something from the polite end of the extreme, let’s go have coffee, to the very impolite end of the extreme, let’s go do something else. All the positioning is that. John’s positioning is a reverse. And so his business is WomenApproachYou.com. So his business is all about how you get women to approach you. Reverse position. Craig Proctor’s USP don’t have time for. Okay number four – process change. I’m going to touch on this very quick to bring myself a little time. Process change – within every business, within in any sales career there are a bunch of processes being used. Another good exercise, it relates to the use of this idea is you need to go home and make a list of all the processes that are being used in your business. So for example there’s a process in your business for how the phone is answered and a new customer, new client or new prospect is treated when they call. You have such a process. ‘A’ you may not have been aware that was a process and you may have just been letting it happen however it happened. Or let Betty do it however Betty does it or you may know it’s a process and actually have diagramed out a little process for what’s supposed to happen and have a script. But it probably isn’t happening the way you designed it. Or it may not be as good a process as could be and you haven’t really spent a lot of time on it but nevertheless it is a process. There’s a process for what happens in a retail store at the cash register when somebody comes up to pay for their goods. There’s processes upon processes upon processes upon processes. There’s enormous opportunity in focusing on process change. What’s the process? How can we do it better? Should we substitute an entirely different process for it? Got a list here of just some examples. In the 1950’s a different process was created at the retail level for how people pay for merchandise. Retailers figured out a way to get people to pay for it in advance with installment payments instead of buying it and then paying for it later with installment plans. It’s called lay-away plans. Now they’ve just about gone away today but in the 1950’s and into the 60’s they were huge. The way your
parents bought a washing machine or bought a new couch is they went down and they picked it out at Sears. They opened up a lay-away plan and they paid $25 bucks a week into their lay-away plan account until the $400 bucks for the couch was in there. Then they picked up the couch. It was a revolutionary thing in it’s time. It changed the process of how people buy and pay for things. It didn’t change the business. They were still selling the couch. One step selling to lead generation. A lot of businesses their process is run an ad, get somebody to come in. Buy something. Problem with that is the only people coming in are the people ready to buy something this weekend. So all the people who looked at the ad and have some level of interest to maybe buy that something they aren’t ready to buy it right now. They were wasted. You paid money to put an ad in front of them. You paid money to get them to look at it but you don’t know who they are and you have no relationship and you can’t follow them. You can’t follow up on them. So the change to lead generation kind of advertising that says, “You don’t got to be ready to buy anything right now but if you have some kind of interest call this number, go to this website and we’ll send you a bunch of stuff,” and then you can start a relationship with them. That’s changed many, many businesses for the better. A simple thing like the free recorded message. So you’ll see in the Yellow Pages ad now, you’ll see the regular number so like a plumber ad. You’ll see the ad to call if you want to talk to a live human being in the plumber’s office. So like my toilet is stopped up and I need a plumber right now, I’m calling a plumber. But maybe I’m in the Yellow Pages because I’m thinking about remodeling the basement that I’m going to put in a shower and a toilet down there and I’m sort of looking and getting information. Well now there’ll be a second number for that. You can call our toll free recorded message and hear the seven mistakes people make when they buy new bathrooms for their basements. And you can get a free report 27 Smart Questions to Ask a Plumber Before you Permit Them to Enter Your House. Okay? So that’s the use of a toll free recorded message to double, triple, quadruple the power of an advertisement. Single sale to continuity… 10 Million Dollar Secrets to Instantly Transform any Business or Sales Career
All TV these days, the infomercial business where I’ve done a lot of work. You know the annoying shows that at 2:00 in the morning when your resistance is down sell you things that you’ll never use, never…the mixer, the ab chair, which is the funniest. I like Jake but it’s the funniest of any. It’s a lawn chair. I mean the ab chair. You set in the chair and you bend over. I could do that in this chair. I mean really have we gone so far. The thing’s got a little spring in it that as you start to pull forward kind of pushes you. Really have we gone so far? What amazes me is, the big mistake he made is he didn’t put a cup holder in it. Should’ve had a cup holder. Well look in case you don’t know this, this is a rule if you ever get in the fitness equipment business. All
fitness equipment sold on television, all of it, it must have handles that point your curve up. You know why? It’s not federal law. It’s because if they curve down when you hang the clothes on them they fall off on the floor and people are unhappy with the fitness device that they bought. The other thing is a fitness device must fold up to slide under the bed because that’s where it’s going to go and you want it under there so it doesn’t get returned. See if it’s sitting up there staring at you eventually people like to return it. Anyway in the infomercial business huge breakthrough was continuity. So like my client Guthy Renker, see you can’t buy a box of Pro Active, the acne block from the TV show. You can’t do it. You have to join the club and get auto shipped supply of glop. Now what we…it’s a professional term glop. It’s an insider language. So you can’t just buy one thing of glop. You can sign up for glop for life. Now you got to stop the glop. A lot of people don’t. I shot an infomercial years ago for another acne product, a skincare product rather, the regular skincare stuff and we were looking for testimonials. We find a three generation family. And so grandma’s using this stuff, momma’s using this stuff and her daughters are using this stuff. They’re all in Tennessee. It’s a great story. Fly them all in for the shoot. Well grandma, grandma’s in her 90s and so first of all grandma has shrunk. She’s really small. And her skin is…she looks like a Sharpe dog all right? I mean grandma’s just got [noise] and so I’m doing a preview and grandma says, “I’ve been getting this product every month for 14-years. And when I started my daughter used some of it and then my granddaughters started to use some. But then my daughter signed up and gets her own supply and now my granddaughters they get their own supply. It keeps coming every month and I don’t go out as much I used to and my face is smaller. I don’t need as much of it.” She said, “The closet’s full and I’ve got some down in the basement next to the jelly jars.” It’s all I can do not to say, “Hon you can stop.” But my client is this skincare deal and grandma’s getting a shipment every month for $39.95 and she’s going to get it until they close the door baby. So a lot of people won’t stop, choose to do direct response business on TV but it’s just a process change. Were still selling glop. The only thing we changed was from optional, you can join the club to you are joining the club. That’s all that changed. Options in the second sale after the sale. I’ll do this real quick because it happened to me the last time I bought a car. I didn’t see it before. I’m sure now it’s; a lot of car dealers do it. I just wasn’t aware of it but it’s brilliant. It used to be when you bought a car they pitched you on all the options when you bought the car and bundled it all into the financing. So a few years ago I go by. I’m not a new car a year guy. I was when I was young. I’m not now. So I’ve had the same car for like eight years. So I hadn’t seen this. So now I go buy new Ford Explorer and I go to pick it up at the dealer and before they let you have it they take me back to the after market specialization consultant. You have to have a meeting with them. It’s not a choice. Back you go. This guy now sells all the options you didn’t buy when you bought the car. It’s the Pimp Your Ride stuff. It’s
the better wheel covers. It’s the better stereo. It’s…I mean it’s the, “I see you didn’t get undercoating. Do you realize in Ohio without undercoating two years, long before you’ve paid off the car it’s going to be a Fred Flintstone car?” “You’re going to have little feet and your going to be pedaling down the road through the [inaudible]. You don’t want to do that do you?” They sell like five; $6,000 dollars worth of options after the whole thing’s done. Then you go back to pick it up, second sale after the sale. Brilliant, incredible. Think of all the businesses that could apply to. Okay here’s a biggie. This is like the biggie of the day. This is something that went on almost with no thought. It does require some kahoonies but almost with no thought. You can go home and immediately increase both the income and the value of your business. Here’s all you got to do – the strategy is price change. That’s all you got to do. I made more people more money by getting them to raise their prices than by anything else I’ve done. Make a note. Every marketer grossly underestimates the elasticity of price and neglects the percentage of their customers who will cheerfully buy a higher priced premium option of what they sell if it is offered to them. They leave a lot of money on the table by not offering a leather bound addition of the paper bound addition or some version there of; a blue door you can walk through in the back instead of the red door in the front. In 1978 when I moved to Phoenix there was a very popular nightclub in Phoenix, big long rope line in the front where you could buy a card for $500 bucks a year that allowed you to stand in the rope line in the back. Well who’s going to buy a card for that? A lot of people based on the length of the rope line in the back. In fact some nights the rope line in the back was longer than the one in the front and I walked around and got in around the front. People will buy a premium option. Price is also very elastic. Most people don’t understand how elastic price is in part because they do what I talked about earlier, how do you set your prices? How you figure out pricing your business to start with? Here’s what most people do. They look around at what everybody else in their business is charging. And then if they’re really gutsy they try and be a little higher than the average or if they think they can buy volume they try and do a little more than the average. Here’s the power of transaction size. It’s a very simple example but you ought to put it up on a wall where you see it. How do you get to each million dollars your business produces? Well you can get there with one transaction if you can sell somebody something for a million bucks. If you’re going to sell somebody something for $100 bucks you’re going to need to make 10,000 sales. Making a million dollar sale is not 10,000 times however; it is not. I’m not saying Starbucks could figure out how to make a million dollar sale. They have figured out how to sale a cup of coffee for $8 bucks. They didn’t do that by saying, “Let’s see Denny’s is $0.55 cents, Dunkin Donuts is $0.72 cents. Oh boy let’s be really courageous and try $0.79.” That isn’t how they got there.
Omaha Steaks – how many of you buy from Omaha Steaks? Good for you. Everybody ought to get good steaks. They’re come in Styrofoam box delivered right to your door. How many of you, you Omaha customers, how many of you buy hamburgers from them? How many of you buy hot dogs? This is instructive by the way, if you’re looking around at them instead of me. If you want a sucker list you want to get the names and addresses of the guys buying the hot dogs. Okay Omaha prices are roughly I don’t know double, three times the best stuff being sold maybe at the supermarket or the butcher shop in your area. They maybe five times Costco. They do deliver it. But a steak is a steak. Now for a long time when you told somebody you were buying Omaha Steaks that you got the old [noise], “Oh I can’t believe you’re paying them.” Anybody here buy from Allen Brothers? Awe you got to switch. You got to switch. It is honest to God and I was an Omaha customer for years and I like the guys and I still use Omaha to send client gifts because…but for me Allen Brothers it’s a…you can’t even believe how much better it is. It’s twice the price of Omaha. These guys got in the same business, catalog selling steaks, hot dogs, hamburgers. And they have the gall to double Omaha’s prices. And were switching like there’s no tomorrow. Price elasticity. There’s a whole thing in this month’s…we have a newsletter called Marketing to the Influent, in case you don’t know. There’s a whole thing about a subscriber wrote in out rage at what Williams-Sonoma was charging for cookies. He don’t get that it isn’t about the cookie. He didn’t understand it’s not about the cookie. It’s about all the emotional reasons attached to why you would buy that particular cookie from Williams-Sonoma and there’s lot of reasons for that. Lots of people on my list here I’d like to talk about. I talked about Charlie. Ron Caruthers who may be here, he’s in sunny California. He’s in the college planning business at my urgent he’s increased his fees four times in the past 12-months and in total nearly tripled them, no suppression whatsoever in any meaningful statistic in his business. By that I mean no difference in the number of leads converted to clients, no loss of clients, no negative changes. But four fee increases in 12-months leading to nearly triple the fee. Don’t make any difference. Doctor Fairfield who’s got a cosmetic practice in the Philadelphia area and he does seminars to bring in new patients, I got him to test at his last seminar offering a $25,000 dollar membership in the practice for the patient to have all the cosmetic procedures they want or need for three years. So you want to come there every day and get a Botox shot you can, $25,000 bucks prepay. Five out of a room of 150 and three of the five were brand new patients with no relationship to him. They came in off a newspaper ad and were sitting in the seminar room, $25,000 dollar membership. That’s price elasticity. It’s everywhere. I promise you and most people underestimate it, most people don’t understand it. Number six – Immunity to criticism. When you conform to the renegades rather than to the majority of people in your business, in your profession, in your circles of influence, in your community you will be the subject of derision and attack. I have a client; come back to this…this is a great story. I have a client who owns a big chain of furniture stores.
Does very well. His wife, lovely lady but basically a social climber. She’s very involved in the ladies clubs and the country club and all of that. He’s basically a blue collar guy who got rich. If he could, their living room would be like the one on the Frasier show. It would be elegantly decorated but with his old ugly recliner in the middle of it. So that’s the dichotomy. All of his marketing for his stores is the kind of stuff Bill showed you yesterday. It’s our kind of stuff and so to her it’s ugly and embarrassing. He can’t, for example, go home and say, “Look at his mailing we did last week that did a 48 to one ROI and brought in 600 new customers.” All she says is, “I hope my friends didn’t see it.” So here’s what he started to do for peace at home. Every year he has designed for him a beautiful normal looking four color 12-page brochure about the stores. He has to print 10,000 of them. He then throws out 9,700 of them because they’re useless. He gives her 300 so she has something she’s not embarrassed about to show her mother in-law and her friend and she lays off of criticizing him all the time for the stuff he is doing. He just tries for her not to see the newspaper ads. Second great story; we had a chiropractor. Years ago we got to do prepay. The guy was starving. $3,000 dollars a month. He wasn’t even paying the rent. Second month doing prepay he had a seventy some odd thousand dollar month. He made the mistake at the Sunday family dinner of telling the family of how well he was doing. Two mornings later the parish priest arrived at his office dispatched by mom to sit down and counsel with him because you couldn’t possibly be doing that well that quickly without doing something illegal or immoral. You laugh, he never recovered. The next month he did $6,000 bucks and four months later he was working for another doctor in his office for a salary. He never recovered. A key common characteristic is enormous immunity to criticism. The renegade millionaires have in common this – they don’t care what anybody thinks of them except those who give them money. That’s the only vote you get. They know their spouses’ opinion doesn’t count. Their mother in-law’s opinion doesn’t count. The trade association they belong to, their opinion doesn’t count. The peer across the street opinion doesn’t count. Not even their opinion counts. We got to learn because were often wrong. I’m the highest paid direct response copy writer in the country. I’m pretty good at it but every once in a while I do four different things for a client to test and the one he and I both love and think is going to kick butt and take names is the dead bang loser. And the one we were all suspicious of, “Awe but let’s test it anyway.” It’s the hero. I know my opinion can’t count. The only thing that can count is results. Interesting thing about this list is it probably wouldn’t be happy about being paired with Jerry Springer but nevertheless. The other thing I’ve got a few things that haven’t made Zig all that happy. There’s a profound commonality between the two of them. And here it is. They don’t care what anybody thinks about what they do except the people who respond to what they do. So Zig does a very bad thing as a speaker. He does it in every speech.
You couldn’t get him not to do it. He gives you his biblical testimony. I can’t tell you when he started speaking the number of people who took him aside and said, “Zig you can’t be doing that. You’re going to offend a lot of people. You’re not going to get a lot of corporate gigs. You’re not going to…” This guy for the three of the four decades now has been the single most successful motivational speaker in the history of all time. And by the way I may not want to hear it, you may not want to hear it, make any difference. What he cares about is the people who respond to him. Jerry Springer think of all the…let’s see Donahue’s gone, Sally’s gone, and Montel’s hanging on by a thread. Umpteen numbers of them have come and gone. Who are the two longest running, most successful daytime talk shows in the history of day time TV? Jerry and Oprah. And probably the two of them wouldn’t necessarily like being put at the same banquet table either. Springer’s show actually one of their slogans is, “The Worst Show on Television for 27 Years.” And he’s gotten rich with that gig. And Jerry, you know, checkered little past there. I mean Jerry was one time the mayor of Cincinnati by the way. He failed to get reelected because he engaged in a real bad habit of paying for the services he was using at the local brothel with his personal checks. You don’t exactly want him with his thumb right above the red button do you, you know? Judgment problem there. But immunity to criticism he’s got it. Doesn’t affect him in the least, doesn’t. Doctor Atkins during the entire time with the Atkins brand was built there wasn’t a day that Atkins wasn’t under mammoth attack medical profession, media, you name it. I never saw him once in an interview that was positive, not once. Even on Larry King, Larry’s like the softball interviewer of the planet. I mean the joke about Larry is he could have Hitler on the show and he would, “Tell us about your stamp collecting hobby,” you know what I mean? I mean you know Larry isn’t exactly 60 Minutes at its best 60 Minutes. Even you went after Atkins. Did Atkins, did it bother Atkins? Nah. Completely immune to criticism. People that make the most money are. Number seven – simple one but a big one. Systems – the tiny minority of people who are making tons of money in whatever business you want to look at have this commonality and all businesses and this difference from everybody else in their field. Everybody else in their field is getting up every morning reinventing 67 different wheels in their businesses. The proof is the thing can’t function if they ain’t there. I always laugh at all the people at our breaks at a seminar like this. Everybody’s in a massive stampede to get out in the hall because they got to get on their cell phone. What are they doing? They’re checking to see if the place has collapsed in the hour and a half that they were in the room. That’s what there doing. They figured they got to buy 90-minutes at a time and if they’re poking at it, looking at it, checking on it, talking to people it’s all going to fall apart. And by the time they get back there at the end of the day they’ll be nothing left but ashes. That’s how most people’s businesses run. Its how most businesses run. When I was traveling a lot (don’t do it anymore)…I’d been sitting in the airplane lounge, and now that everybody’s on the cell phone and they don’t have the good grace to go into the phone thing and they’re all around you yakking you can hear all of their conversations.
Right? And what are all the conversations? Day-to-day emergency stuff that is out of control that their patching back together. Why? There’s no system for anything. They’re reacting to everything on a constant basis. The most successful businesses in all America are what? McDonald’s. Think about this meeting. Here’s what were going to do. Were going to open thousands and thousands and thousands and thousands of businesses all across the country. Were going to manage them with absentee owners from distance and were going to put everything in the hands of a bunch pimply faced teenagers listening to music on their iPods and not thinking very clearly because there at like peek hormone run amok time. And were going to invest millions of dollars and perfectly good jobs. Let’s get out your checkbook and invest in that puppy. They do it. Their business is run by kids magically somehow. They get through the day. How does this happen? System. Burger King keeps hiring new ad agency. They can’t figure this out. It isn’t about the ads. It’s because of the chaos in the store. Every Burger King’s different. One of them has got the milk shake machine over here. One of them has got the milk shake machine over here. In order to get a milk shake this clerk’s got to knock down three clerks who are in between him dealing with the customer over there to get over here. The cups for the milk shake are over there. They’re not over by the milk shake machine. Yet Burger King is a mess. McDonald’s is not a mess. It is especially relevant to note McDonald’s has the worst food. They’re the most successful of all of them with the worst food. Everybody knows Burger King’s got a better hamburger. Everybody knows Wendy’s has got a better hamburger. McDonald’s is the most successful. Why? They’re actually fast. So they call it the fast food business because people want it fast. They don’t care about good. Fast. So McDonald’s has a system, everybody else has a poorly shadow of a system. It’s a mess. Go in and watch one at peak. Go watch an Arby’s at peak. “Where’s the bag?” Go watch at Taco Bell. Its horror show. It is. It’s an absolute horror show. This person can’t run the register. This one can’t find a box for this. This one’s yelling for the manager for that. They’re running into each other. Vroom, vroom. McDonald’s has a system. All [inaudible] based on system. Ford family wealth, two systems. Most people think about the assembly line, that’s one. Ford also invented the dealership system for selling cars. Without the second system the first system wouldn’t have been very valuable. Now here’s the real question – do you have marketing systems? Because there the most valuable. A lot of people in business have operational systems. They can manage to get the lights turned on in a place in the morning; they can manage to get a milk shake out of the milk shake machine. What they don’t have is a systemized assembly line approach to bring in their customers or clients to them, to handling them when they come. Our guys got marketing systems. Number eight – macro/micro. Here’s a micro example. In the 1930’s in the recession drug stores had soda fountains. People even went there for lunch. You sat at soda fountain got your lunch. A sales trick, and a lot
of people when they ordered milk shakes they got an air gun. It was like an add on. So a sales trainer whose name I forget, I get the two of them confused so I won’t need either one of them but a sales trainer figured this out. Let’s have everybody when they take an order for a milk shake not ask do you want an egg in it, ask, “Would you like one egg or two?” Elmer Wheeler? Yeah that’s what I heard a lot of them and I get them confused but if you say Elmer, I’m buying. So it’s Elmer. Very simple micro managed thing. One sentence and all the interaction that happens between all the clerks and all the customers in the store all day long change that one sentence. Save the chain of drugstores from bankruptcy, dramatically increase revenues, dramatically increase profits, why? Because everybody takes an egg. Hardly anybody says no to that question. Now it’s like Sales 101 today. But you’d be surprised how many businesses don’t use it. Now that’s a micro thing. I have a client one word in a phone script, one word in a phone script 10 times the number of people who converted and say yes. One word, that’s micro. So everybody we work with is looking for opportunities to make micro adjustments that yield big results. All right. Macro now is what the big vision is, what’s the big idea? How do we take the core business and wrap five businesses around it? Some people are really good at one and not really good at others. Bob Iger at Disney, we don’t know yet. He’s done a marvelous job since taking over for Eisner in terms of finance. I’m a Disney stockholder, I watch. And that’s up 18%. But Iger’s a very bottom line guy. He’s real good at the micro stuff. His rap is no vision. Not an idea guy. Not good at macro. Too soon to tell. Will he go get a guy who’s good at macro and pull himself with it? Will he let his ego get in his way? Will he get…we don’t know yet. But the really good ones are good at both. They do both. They take a look at their business every day from the big idea side. Some time this week could somebody give me, can I get a big idea? And they pay attention to all the little nitty gritty tiny stuff. Number Nine. This is huge and regrettably I don’t have time to convince you of it. I only have time to tell you about it. The way the vast majority of people approach advertising and marketing is the opposite of what you see on the screen. They’re all trying to figure out how to spend as little as possible to promote their business to get their customer. So were all worried about if were going to do direct mail we can’t put anything more in an envelope than we’ll mail for a stamp. I don’t want to wait to shove me over into two stamps. I got a client who’s testing right now, does a lot of direct mail; testing 90,000 FedEx’s this month. He isn’t worried about two stamps. Excuse me. Should’ve apologized to start with. I’ve been fighting a little throat problem for the last week or so. 90,000 FedEx’s he sending this month. He just adjusted the economics in the business to allow for the FedEx. Not one of his competitors, all of his competitors use direct mail. Nobody sends FedEx’s. Nobody’s going to send. Incidentally this business of his is a seminar business that puts on seminars for the recently bankrupt. Dan: I promise you nobody’s sending him a FedEx box to sell them anything except him. So the vast majority
of everybody, all of your competitors that come to the table with the mindset, “How can we spend less?” The questions are always, “I’m doing pretty well with my Yellow Pages ad this big. Can I buy the next smaller one?” Not, “Hey I’m doing pretty well with my Yellow Page ad this big. Do you think I should buy eight pages?” I never hear that question. I always here the other question, “How I can do less? How can I spend less?” Except for my winners, because my winners know the ultimate competitor advantage is being able and willing to spend more to acquire a customer than anybody else who is talking to them. I will pick a category in business [inaudible] routinely now. I’ve taken people from zero to million dollars a year incomes. I’ve got them spending $6,000 dollars a piece to make a sale. I would say that the average in their business is maybe spending $500. We just choose the pricing and the economics to allow them to spend $6,000. They’re selling something that normally sells for $4,000 for $30,000. They can now do things nobody else who was talking to their prospects can do. So the strategy is be able to spend more, don’t strive to spend less. The normal question is, “How can I spend less?” The renegade question is, “How can I spend more than anybody else who’s talking to my prospects is spending?” If somebody’s sending them a FedEx how could I send them a big FedEx? There’s a financial guy, investment guy been a member of ours for many years in Chicago. He targets, he only does business with people who have invest able assets of $10 million or above, they’re running family owned businesses, etc. Bill probably showed you the trash can mailing yesterday. Did he show you the trash can mailing? The little aluminum trash can. Let me tell you what this guy does. He picks 50 prospects every month. He has delivered to them by messenger a full size trash can. The one you buy over at Home Depot or Wal-Mart. Full size aluminum trash can, hand-cuffed to the wrist of the messenger. Somebody has to sign for it. The sales letter is inside the full-size trash can. Two things, the gatekeeper ain’t throwing it out and even if she was bold enough to do so into what is she going to throw it? It won’t fit in the wastebasket. Awe the mental picture of, you know, Bertha the hun, the real determined gatekeeper, try it. She is going to force this into this wastebasket no matter what. Yeah. 100% get the sales letter. Over half call. Over a third book appointments. It’s his whole marketing system. It cost a lot of money. Trash can, the messenger, hand-cuffs, guy’s got to go back three, four times to get the right person to sign for it. It’s expensive. Pretty much everybody who ever sees it thinks he’s an idiot. He’s doing very well. Number 10 – personal behavior. I have a saying, “There are no business failures. There are no business successes.” It’s all personal. My personal investment strategy is to not pay so much attention to the annual report. It’s to pay attention to the people running the show. I think personal behavior matters enormously. There’s proof of it, the Disney example. Eisner was a fabulous CEO until his personal behavior got goofy. Then he had to go. Personal behavior matters a lot. The business is driven by you. And what’s important is it is about behavior. It’s not about so much attitude or positive thinking. I think all that stuff is in nice and useful and there’s no doubt if you want to call it a positive, negative, it does have a physiological affect on you. All that’s true but…I
was driving around in a car with a cassette player next to me and I was thinking positive and I was driving in the $25 dollar car and I was dead broke. But I was positive. But the behavior wasn’t right. So it’s behavior. Now here’s a secret, here’s what my Renegade Millionaire System is really all about. It’s the thing I call about behavioral congruency. And so going all the way back to the beginning, if we identify a key list of things that are extraordinarily successful entrepreneurs and business leaders and marketers do, not so much what they think, and by the way there’s big differences in how they think. If we talk to Zig and we talk to Jerry Springer big philosophical differences. Big. There’s significant philosophical differences between Zig and I. But there are a few key behavioral commonalities. They do certain things exactly the same. We do certain things. It’s about what we do, not so much what we think. Not so much our attitudes. It’s about behavior. Now here, so if we identify the behaviors what do these people who are getting the kind of results we want do? So everybody that has to run out on all the breaks and jump on their cell phone right away and check to make sure that the place hasn’t fallen apart in their absence, and checks their e-mail 36 times a day. I do a four day seminar, set up here. I only take one bathroom break a day because I got a good prostate. And I don’t have a cell phone and I don’t use email. And, I go four days without checking with anybody. My place doesn’t fall apart. Everybody else is out there worrying about if their place is going to fall apart. So who’s behavior is people, it’s a pet peeve of mine; they’re at the urinals on their cell phones. I mean, you know, women if you don’t know guys are doing this you can’t go into a public restroom now and they’re not talking on the phone while their peeing. Now really. If things are so out of control in your life that you can’t find five minutes to pee in peace, you know, you got some real issues. And for the egotistical numnuts now that you think that makes you look important. Please. It does not make you look important. It makes you look stupid. But you got to look at the behavior of the people who are getting what you want. Some people say all the time to me, “I envy the way you do business.” And then they keep doing the behavior of the people who don’t have the results I got. If you identify the behaviors of the people who are getting the results you want, the behavioral commonalities of enough of them that you can call a principle, that you can call a strategy and you mimic the behavior. You don’t even have to believe it. If you mimic the behavior, if you bring your behavior congruent here’s what happens almost magically, almost miraculously, automatically the results happen. When you have behavioral congruency you have result congruency. If you really like the results, for example, that Trump and then find somebody like Trump. If you like the results, if you like the fame, for example, if you like being famous and you want to be famous and you want to be on Big Idea and you want to be on Oprah and you want, just find 10 people who are on there all the time and figure out what they all do the same. There’s guys they have this company called 1-800-Junk. You know this company? People now pay them to come and haul the crap out of their garage. Very funny. Got a love that. Those guys got on Oprah. They’re
on Oprah. They sent stuff to Oprah’s show - all the producers, all the talent scouts, everybody, day-after-day, week-after-week, month-after-month for over a year. They sent little 1-800-Junk trucks. They sent Styrofoam doohickeys. They sent all sort…they were just relentless. Finally one day somebody’s desperate for a story idea and they got the 1-800 Junk truck sitting on the thing. They’re using it as a pencil holder. That’s how the guy’s got on Oprah. Someone said, “Well that’s a fluke.” No that’s a system. That’s a behavior. And if you probably, if you could find…if you went and took a close look at the last hundred people who got on Oprah who weren’t already famous and you went and looked and commonalities you’d find that the vast majority of them had that behavior in common. They were probably relentless. They probably got the names of everybody who was working there and they started sending them stuff and they kept sending them stuff and they kept sending them stuff and they kept them stuff and they didn’t give up until somebody called from the Oprah show. So behavioral congruency is where it’s at. Your objective should be to get in-sync mentally, emotionally but most importantly behaviorally with the people getting the kind of results you want so you can get those kinds of results. It’s called, there’s a psychological term for it, and it’s called mock modeling, meaning we’ve modeled the behavior of the people who are getting the results that we want. One of my earliest mentors said that his earliest mentor was a very wealthy old guy who walked with a limp. And so for four years he walked with a limp because he wasn’t sure maybe that was it. He’s more right than wrong. That’s what modeling is. Now so you got to look at how do they handle opportunities. How do they handle problems in crises? How do they do their advertising and marketing? How do they approach their business differently? All the different things they do to build a model that you can follow. Now doing it physically, going and hunting them down and like doing what I just said about all the people who maybe got on Oprah and weren’t famous; that’s all very time consuming and very complicated. I got a shortcut for you, which I’ll tell you about in a minute. But first the last thing I want to tell you about, two quick things, one is there’s a thing called phenomena. The first time I heard about it I was very young. I heard it on an Earl Nightingale, a home recording. And Earl said, “There will come a time in your life when you [inaudible] the opportunity to accomplish more than 12-months than in the previous 12-years.” Now what I discovered is if for most entrepreneurs this thing occurs at least once. And so in most cases we look at somebody and we think that they got rich quick. They did but there was a lot of time before the period of time in which they got rich quick. And that time can be eliminated or reduced if you know the factors that trigger this. It happens for just about every entrepreneur. Everybody has at least one time in their entrepreneurial career where like everything clicks. And they get more cooperation, more results, more money, more stuff comes to them, they stack up more cash, they had more income in 12-months than they had in the previous 12-years. Happens to everybody. However most of the time it happens through an evolutionary process. Not through a process of consciously
pulling triggers. All of the work I’ve done with the hundreds of Renegade Millionaires I finally figured out what the trigger is. Well we can now like trigger it. So we can routinely take somebody, for example, take them for a $100,000 a year to a mil a year. The other thing I wanted to tell you very quickly about this system is that it is not just about making money. And also making a lot of money is not that big of a trick. For someone who’s not making a lot of money that sounds silly and arrogant but if you are making a lot of money you know it to be true. Once you’re doing it you realize it’s not that big of a trick. Making a great deal of money though in a way that is satisfying to you, pleasing to you, that has you in control, that doesn’t have you selling your soul now or later, that’s a much bigger trick. There’s a principle I teach in the system called autonomy. Autonomy is about doing business, doing what you want, when you want to do it, where you want to do it, most importantly with who you want to do it meaning not accepting anybody, any client, any customer who comes down the pike. Most business people complain about their customers and their clients, by the way, and I say, “You got him. There’s no law you had to take Charlie.” You put certain things in motion that attracted these customers. They didn’t materialize by accident. You have nothing to complain about if you’re not willing to fire them and replace them with something better. So with whom you want at the price you want at the terms you want. That’s autonomy. You’re able to do business entirely on your terms. When you have the trigger factors, the strategies that we talked about this morning and there’s another 30 some odd in the system, when you have those all in place you get to do business this way. I don’t care what business you’re in. If you’re a pet groomer. You can be a consultant. You can be a real estate agent. You can make them stand in line they’re going to do business with you the way you want to do business. You can exercise control like you cannot imagine. Let me give you one quick example; this is, this is Darin Garmin I mentioned to you earlier. This is the letter I got from him actually a couple years ago, November two years ago. I sent a little gift. Let me tell you about a typical recent week thanks to my implementation of your strategies. This all happened this week. We purchased $867,000 dollar commercial property. I placed another property under contract for a client for $3.1 million. I purchased an apartment property for $3 million and some odd. I got three apartment listings worth over $1.8 million. A client called and sight unseen bought a $245,000 apartment building and another client sight unseen had me submit a $16 million dollar offer on a shopping center. I’m working from home, out of the office 60% of the time. Every new client must complete application forms and pay a fee before I will talk with them.
As you know I have invested personally more this year than ever before. Thanks to you we advertise nationally and have investors coming in from all over the country. On the phone yesterday a new investor from California asked me to put $400,000 dollars into deals, signed the application and exclusive forms and paid me to represent him. One of the biggest things I have gotten from you is not to be afraid to push industry norms out of the way and run a business like I want to to suit me. Many people believe this can’t be done and that’s good news for the rest of us.
Now here’s why it’s so important to get it. Here’s a number. This number, anybody know what it is? Average life expectancy of the American male. Female number I believe is a little longer. We could have a long conversation about my theory about why that is but that’s really, really, really long. However that’s the average life expectancy of the American male. When I write this I said I was in direct response so I wasn’t 50, I was 49.95 or 49.50 but when I wrote this, it was a couple years ago, I had 28 left. There’s a sobering thought for you. How many you got left? I have 28. Now 20% of that’s going to go to sleeping even in defecating. There’s nothing you can do about it. The amount that doesn’t defecating is an enormous amount to do and how much goes to eating. 10% of it’s going to go to paying taxes, paying bills and miscellaneous accounting. Nothing you can do about it. You got some forms you got to sign. 10% is going to go to what I call unavoidable time suck. You’re going to do everything right and your still going to wait for two hours at the airport. It’s unavoidable. That left me 16.8 years. That’s all I got. I don’t know what your number is that’s mine. Here’s the big question – how much of that time, whatever your number is, do you want to spend dealing with people who annoy you, aggravate you, irritate you? How much of that time do you want to spend not having it your way? I had friend who said one time, “You act like you think the whole world should revolve around you.” And I said, “And your point?” I got 16.8 left. Yeah that’s exactly how I act. I stopped several years ago; I was on the road all the time. So I said, “I don’t want to be on the road anymore.” Just radically changed my business. I want to race my horses. I got to be home to do that – Monday, Tuesday, Wednesday, everyday, got to be there. So everybody’s got to come to me. You all got to be done by 4:00 in the afternoon because I’ve got to get to the track, Blow the breathalyzer, put on my clothes and be ready to go by 6:00. So I arrange my business for that purpose. You think you can’t? Yes you can if you put these strategies in place.
