The Principle of Defiance (2 of 2)

Welcome to the Magnetic Marketing Podcast. This episode is part 2 of the principle of defiance, where we're going to defy industry norms, break away from false beliefs, and set ourselves apart from every other entrepreneur in our field. Now, if you're jumping ahead, stop, rewind, definitely go back and listen to the last episode. But if you know why you're here and you're ready to listen to part 2, let's dive in.

I don't think there's anybody that has had a bigger impact in the field of direct response than Dan Kennedy, the legend of Dan Kennedy should be ignored at your own peril. They're not really lessons, they're kinda laws that you live by.

Dan opened my eyes to what small business marketing looks like.

Dan teaches strategic direct response that is timeless. His ripple effect touches people who don't even know his name.

The world as we know it was changed because Dan Kennedy became obsessed with marketing.

Welcome to the Magnetic Marketing Podcast with your host, Dan Kennedy. Last of the big ideas before we break. Take a little break. Because nothing is final and nothing is inevitable and nothing is permanent, business and life is all about your what's next. Now, from the narrow marketing standpoint, you guys already know this, right? Because it's in a bunch of our stuff and it's been talked about and, you know, the smart marketing system always has a what's next. There is no dead end in a marketing system. So when they buy something, what are they going to buy next? What are we going to buy next? And if they say no, what are we going to do next to get them to say yes? And if they buy this, what's next? And then when they buy that, what's next? And if they sign up for this, what's this? So that's narrowed to the marketing principle. But the big general principles are this: attempting to postpone what's next, not smart, because not only is there going to be a what's next, but there should be a what's next, and all your opportunity is in the what's next, not the what's now, and certainly not what has been. Resentment of what's next. This is the biggest thing I've been dealing with with my clients since the recession. Biggest thing is a thought that they were entitled to having things continue as they were, that everything was gonna be okay if we just waited, and then a resentment of having to do different things. If you have felt that, it's perfectly understandable, but it's not particularly useful. So resentment about what's next, not smart. Then last, investment in what's next. It's why it's disturbing to me sometimes when I name names and people don't know them, because it tells me they're not invested enough in study of the profession they're in, which is marketing, the business they're in, which is marketing, the success field, but the investment in what's next. So the smart people, like who come here, are looking for what the next opportunity is, what the next set of tools is, what the next— the not smart people aren't looking for that. And so it's always about what is the next thing. So as you walk out of here, you hopefully are going home to affect change, to get ahead of change, to do different things. And one of the things that we always try and do is bring you entrepreneurs and people at these events who embody these kinds of principles, right? So, last thing I want to talk about is this one-thing business. You know, the thought of 15,000 products, but it sort of leads into this. This one-thing business. And back to the one secret. One thing can be enormously valuable, but. So I really want to talk to you about this last thing about the idea of complexity versus simplicity. And I think it's important, I think it's, useful in going to make a lot of money in whatever it is that you do to decide that you are not going to lust after or search for simplicity, but instead you are going to embrace complexity. So one thing can be real important. In her case, her celebrity initially important. I suppose you could say the socks important. In Disney's amusement parks, we know that the one thing that was really, really important was the idea of one price, ride anything, and come in and out through one place rather than open access so that you can march past all the souvenir stands on the way in and again on the way out. A very important one thing— Amazon and, and Zappos, which Amazon bought— one thing really important: unlimited selection. So you can go down through great business after great business after great business, and you can find One thing that sort of is a trigger. So my most successful clients, for one, the idea of conversion franchising. For another, Guthrie Renker was the first company to put a celebrity host in an infomercial, changed the entire industry. One thing, very important. But, and the but's the key word, the but is, is that every one thing conceals a myriad of little things. Everything that appears to be simple is actually extremely complicated, and it's all the little things that matter the most. And what most people are always trying to do in their business is simplify everything. And there's many reasons you don't want to do that. One is it eliminates barriers to entry and barriers to competition. The simpler what it is that you do is, the easier therefore it is for other people to do it. And to do it perhaps cheaper, to do it faster, to throw more money at it and grow it faster, etc. So I thought I would show you an example of a one thing that was very important but is actually very, very complicated and encourage you to do the same kind of analysis with what you do. So one thing for me that was very, very important— how many of you have heard the basic magnetic marketing stump speech, the speech that sells magnetic marketing. By the way, it's more instructive if you look around at them than if you look at me. Okay, how many of you made your first purchase as a result of that speech? Now that's very instructive, by the way. So that speech, I call that a million-dollar speech because that speech That speech is not only one thing that created well over $1 million in net worth, it created $1 million of income every year for a number of years. It's responsible for many of you being in the chairs that you are in this moment, so that one speech. Upstairs at Bill's lunch today, Harry Williams, unusually smart question for an attorney. And by the way, I didn't know he was in your group, Bill. My condolences. So Harry said, asked, what's the, how did you phrase it, the best, the most? Best sales letter that I've ever written. And this may surprise you, but it's not a question I don't think I've ever been asked before. And it's a good question. And so I didn't have an answer. I didn't have a stock answer for it because I hadn't been asked it before. But in thinking about it, of course, best, like expensive, is a very subjective term. So best of show is pretty arbitrary, for example. Best in a race is not, however. You either finish first or you don't. Best sales letter, see, how do you answer that? Why do you like the one you like best? I said, because best results. So I am, I did give them the answer based on most money, but that's a specious thing because one sales letter might be written for a total universe of 5,000 people and it could only, and selling a one-time thing, and there's a, it could only produce so much, whereas another one has evergreen life with millions of people and can produce much more, and yet the 1 to the 5,000 in other measurements, percentage of response, market share, ratio of number of people who responded, etc., it might have been much better than the other one. So there is no good answer to your question when you have been as prolific over a period of time as I have. And actually, the key to being that prolific is, of course, abandoning any idea, any commitment to quality, excellence, any of that, so that further muddies the water of giving him an answer to his question. But in total raw dollars, if you just looked at it as what piece of work have I ever done that produced the most amount of money, it would be the script for that speech. I don't think anything I've done has produced as much money. There's some things that are produced more, but they're pieces of other things, and so you can't really quantify them. I wrote a 3.5-minute call to action for a Guthrie Wanker infomercial, and the infomercial probably has done, I don't know, $100 million. But, you know, it's a 28.5-minute show, and I only did 4.5 minutes of it, so who do you attribute that money? So the best answer I have is that million-dollar speech, which, by the way, also works as a sales letter. We mailed it almost word for word as a transcript-based sales letter to non-buyers. So that's one thing of enormous importance. It kept me on a speaking tour for 9 years. It generated millions of dollars of revenue. It created a lot of customers, et cetera, et cetera, et cetera. So it's just one thing. It's just one speech, right? So I was analyzing it for a speaker that I was doing some work with about a year ago. I went back and found my notes. So here's the list. So in the one thing, I wonder which one of these things was indispensable. So host and audience mattered a lot. Okay? Who was in the room mattered a lot. That speech, by the way, at one place managed to sell zero. Hard to zero, by the way, but zeroed. Totally wrong audience. But every place else it killed. The speech itself, okay? The style of delivery, the speed of delivery, an introduction in advance tactic invented for the Success events. The first 5 minutes which kept which stopped people from streaming out— well, it didn't stop people streaming out of the room, it stopped some people from streaming out of the room. The product that the speech was selling. The way the product was packaged so that it showed better held up in the front of the room. The price choices. The bonuses. The use of a standalone order form. At the success events, I was the only speaker who had an order form. Everybody else was on one big giant order form with all their stuff listed together and it was all back at a store. I'm the only one who had who had their own order form. And G, which thing— so an order form, so that's one thing. Here's the old original order form. Here's what it looked like. So that's just one thing. It's an order form, right? Well, even though it was the Peter Lo Success Events, the top says, "At the Zig Ziglar Dan Kennedy Seminar." Now that's there because Zig Ziglar's name is much more powerful than was or is Peter Lowe's name. A lot of people in the room thought it was Zig's seminar, and I didn't have Zig's endorsement, but this looks like I had Zig's endorsement. So the use of Zig's name was sort of important. There's an A/B offer, two different price points, two different offers, so that's something. The order form actually has a description of each of the products on it because I say the description of the product really, really, really, really, really fast. And so now people are standing in line and now they can reread the description. There's a price drop built into the order form and there's even— here's a little thing, funny for its time— there's an American Express cardholders bonus. In this order form. So if you use your American Express card, you get an extra bonus gift. You know why that's there? Well, because sales don't matter if they, if they can't be processed. So American Express cards at the time pretty much had no limit. MasterCards and Visa did have limits, and you were much more likely not to have a problem running this sale on an Amex with a guy who had just bought 22 things all day long and everybody was hitting his credit card at the same time than if you tried to run it on a MasterCard or a Visa. So quickly figuring that out, we invented an American Express cardholders bonus so that we would get more American Express cards and less MasterCard and Visas and be able to process more cards. So that's 5 things on the order form alone, but it's just an order form. Relocation of the sales activity. So any of you who were there know I was the last speaker of the day. There were usually, because we were in a sports arena with 20,000 people, so there were usually, not like here where you all go back to one area, there was like 8, 10, 12 areas scattered all over the place on level 1, on level 2. Well, while the last famous speaker was speaking, at my direction we shut them all down and we consolidated everything to the one big order form area right on the floor. So I could— how many of you were here when Ari Galper spoke? Is Ari here, by the way? Ari, are you around? I can't— I cannot believe— I gotta tell you, I'm ashamed of you. Here you are, the kind, gentle, no pressure, using the Ted Thomas Wright Thurston March Pied Piper to the back of the room still yakking into the microphone after you've left the stage close? Aren't you a little embarrassed by that? I mean, really. So I did the same thing, right? So by relocating everything to one area, I could march back with everybody to the area. If they were going to 10 different areas, right, I couldn't do that. Incentivizing the crew at the sales tables, I'm the only one who did that. So we mostly had volunteers and Mary Kay people who had been told they could come to seminar for free if they worked the product. Well, no, they were told the truth. They could hear the seminar for free because they were out and they weren't— they thought they were going to see it, but they were actually at tables all day. So by the end of the day, these people had been on their feet on concrete for 12 hours. They've been eating cold pizza for lunch. They're not in a real good mood. But any other speaker could have done it. I went around and, "Well, here's how many units I think we're going to sell today. If we sell this many, everybody gets $20. If we sell this much more, everybody gets $50. And I'll be back at the end of the day to give you all cash before you go home. And here's the upsell script to use. Here's the 5 things to say." So there's an upsell script to move them from the $99 item to the $278 item. So I'm the only one who paid out commissions, right? I'm the only one who went around and schmoozed them and got them in the mood to do things well. I figured out the upsell. I figured out the bag. So the upsell, by the way, two-thirds of the people came to the table to buy the $99 item, one-third of the people came to the table to buy the $278 item, 90% of our sales were the $278 item. The upsell script was, "Gee, we're out of the $99 thing, okay, but we have the whole kit in the bag you can take with you today rather than waiting." Real simple upsell script, okay. The bag was magic, okay. Good visual. It's all in the bag. Okay, incentivizing the sales supervisor who worked for Peter Law. Not only did I incentivize the temps, I paid him too. So he went around and made sure he did a good job keeping them all motivated. AV crew, AV crew. See, you guys, hopeless, but AV crew. So I used to schmooze and incentivize the AV crew because they could hurt you or help you. We hit this number, everybody gets $100 and you guys can all go have a nice dinner tonight. Just make sure you stay with me, there's no time up here that the mic's not working, you know. So these guys are killing themselves for me, checking all the details the day before, my own competitiveness, etc. So here's the deal. Another popular book, just as dumb if not dumber than Non-Manipulative Selling. So there was a real popular book called Don't Sweat the Small Stuff. Right? Right? It was on the New York Times bestseller list for a year and a half. Yeah, I'm not going to say that word because we have young entrepreneurs in the room. It sold a bazillion books, and it's utter crap. Okay? It's— of course you sweat the small stuff. The money's in the small. There is no one big thing, ever. The one big thing conceals a ton of little tiny details that are all important. I've told this before, but it's a funny confession. When I started in speaking, A, there were no fees for me because I wasn't very good, for one thing. And so all the money was made from selling stuff. And so I booked myself to speak free in order to sell stuff. And at the time there were several places you could get booked pretty easily to speak free. Real estate offices, insurance offices, car dealerships, because they had sales meetings and the sales manager didn't want to do them. And small local, but seriously, that's all you had to do was call up and they said fine. And small local network, what, called today network marketing groups. So the local Amway group, the local Herbalife group, you know, 12 people in a living room for the sales training meeting, at best 50 in a hotel meeting for the, for the monthly thing, you know. So the local coordinator would let you come in and speak for free and sell stuff. So the first thing I figured out which every one of those companies, there's a couple things that are really important to everybody who belongs to one of those companies. One is the origin story of the founder. They're dedicated to a person. Second, color. Color. They're like, you know, college universities, and I mean, color matters. So Mary Kay, the color's pink, right? And so that's a big deal. Pink Cadillac, pink clothes, pink hair, pink everything. Herbalife, it's green and gold. Amway, it's red, white, and blue, and so forth. So the first thing I figured out was that the color of the product mattered. All right? It was a little detail. You didn't change the product, but you just changed the COVID on the product to match the company colors of the company you were going to go do the speech for. You got more sales. So I had the same product, but I had a different color cover for every group I was going to do. The logical deduction from this is if the color matters on the product, the color matters on the person. So, and by the way, it does. Okay, so I quickly deduced that if I was going to go to an Amway group, if I dressed in a blue suit and a white shirt and a red tie, I sold more stuff. If I went to an Herbalife group, I had a green suit with little gold pinstripes in it, You saw green alligator shoes, and you saw more stuff. Mary Kay groups. Oh yes, I did. I had a shocking pink sport coat, a white shirt, a pink tie, pink alligator shoes, white pants, pink socks. I was slick. Okay? Everybody has a line that they draw that they won't cross for money. We've not yet found mine. Little tiny details. I discovered almost every one of these companies has some sort of product that you can carry in your pocket. And find a reason to use while you are giving the speech. The result matters. Amway at the time had a breath freshener, so that was easy. Mary Kay had ChapStick, you know, the equivalent of ChapStick, lip gloss. So you could do that sometime during the speech. Sales went up. Lots of little, tiny things affect the outcome. Hardly anybody's willing to do this work. It's an enormous advantage if you're willing to do the work. I was gonna show you, there's a famous David Ogilvy ad, it was an ad for the Rolls-Royce automobile that made David Ogilvy famous. It didn't do that much for Rolls-Royce, but it made David Ogilvy famous. And David Ogilvy spent 5 weeks at the factory interviewing engineers, people on the assembly line, everything assembling, as much information as he possibly could, every little picayune detail. If you find the ad, it's buried in this, but you can find it. Just go Google Ogilvy and find an Ogilvy book. You'll find it. It's worth finding the ad because if you find the ad, it's a copy-intensive ad for an automobile. It's not a pictorial ad for an automobile, and you will find the detail about exactly how many layers of paint are put onto the car and that they are hand-rubbed between every layer and on and on and on and on. In fact, by 5 weeks 5 weeks at the factory assembling the information with— that he was going to use to then write the copy for this ad. You don't even put 5 weeks in to write the copy for the ad for your own business, let alone for somebody else's. But hardly anybody is willing to do the work to get all the little tiny details right that lead up to the one big thing. Never think it's one big thing. It's a lot of little tiny details. Here's one of the great mysteries, right? The great mystery is when you do everything right, why don't people buy? Right? So you execute perfectly, right? So you execute perfectly. And you get them to raise their hands, right? They express interest. They're qualified. They need what you got. They want what you got. You've done everything right. Maybe they camped out at your site. They came to your showroom. They called. They responded however it is they were supposed to respond, and they still haven't bought. Now surprisingly, that doesn't bother as many people as it should. So I worked with a client a couple years ago for 2 years. They're exactly in that position. So qualified prospects, good execution, the prospect has to raise their hand, the prospect is sent information, the prospect has to respond again from that information. They have to make an appointment. They have to then get in their car, come into an office. They have to go through a diagnostic process, and then finally they are permitted to buy something. They've been invested now for between review of the information and time at the office, maybe up to 4 hours, and they're selling to 2 out of 10, 3 out of 10, 4 out of 10 maybe at best. And when the question is asked, well, under those circumstances, why aren't you selling to any— to all of them? The answer is, well, our closing percentage is better than our competitor. But, but I mean, really, a lot of people don't— aren't as frustrated by this in their businesses as I actually think they should be. So they sort of accept an outcome After a whole marketing— well, starting with advertising— advertising, marketing, and sales process that still leaves fewer people buying than logic says after everything you've done and everything they've done should happen. After all, if you're in the restaurant business, pretty much everybody who goes to the trouble of responding to your advertising, getting in their car, and coming to your restaurant, pretty much 100% of them order something and eat it. I mean, it's not like 2 out of 10 order something to eat, and the other 8 come, sit there, read the menu, get up, leave, don't do anything. So why does that happen in other businesses? There is a reason, and If you really understand and apply yourself to dealing with the reason, and there is a reason, then you can substantially improve the results of every other dollar you spend and every other minute you spend. So at the risk of— are the young entrepreneurs still all at their pizza party? I hope. So here's the example. Oh no. So two guys are at a bar. Alright? Alright? The only reason they're there They're there for one express purpose. And so with a real number instead of just zeros, here's what they see written on the wall. So the conversation is overheard. Did you call? Were you looking? So, did you call? Nah. So the only reason these two guys are there is to find somebody who will sleep with them. Here's a sign on the wall saying, "I'll sleep with you free, no strings, here's the phone number," and they don't call. Why wouldn't they call? You got it. You got it. Who said that? Aren't you married? Is she here? Oh no. You are not supposed to know why they wouldn't call, dummy. Okay, of course, of course, of course, they don't believe it, right? So they say, "There must be a catch," right? The other kid says, "She's probably fat and ugly." Another one says, "Probably going to tie me up, steal my kidney." Another one says, "Might be a revenge deal. I'll wind up getting the crap beat out of me by her biker boyfriend." It's all, they don't believe the offer, right? And so ultimately, ultimately the first and final barrier to every sale comes down to belief. If they went through all the gyrations to get to the point of purchasing and they aren't purchasing, there's only one possible answer. It's a belief issue. Now that's not necessarily a simple issue, it could be a complex issue because there's belief in you, there's belief in them, there's belief in product, there's belief in proposition. So here's why this doesn't get handled well. You think that your proposition is rational, safe, easy to understand, and that you're an honest and likable fellow, right? That's your premise. That you're coming from. Their premise is you're a liar and a thief and your proposition is nonsense. That's the place they're coming from. Now it's very difficult for you or I to think about where they are because we think we're good guys and we've done a good job and we've got a good product or service that will really help them, right? But, but Think about the mindset of this person who is now confronted finally with having to reach into the pocket. I call them the almost persuaded. They almost, almost, okay? But they've been conditioned almost since birth not to believe you when you put this proposition in front of them. They've been told strangers are dangerous. More often than not, they've been around people who have a negative view of salespeople. Odds are that's true. They're currently being told by any media they might pay attention to that business people are evil. So this is the environment in which we step to try and get people to exchange their money with us for our goods and services. And it is so very hard for us to get this one important fact: every proposition, and any proposition, is preposterous to the person who has been disappointed before and who has little confidence in their own ability to make good decisions over bad decisions and to follow through and use what it is that they buy. Who does that describe? Every prospect. Sure, every prospect. So since that's where they are, every your proposition is preposterous to them. But to you, your proposition doesn't seem preposterous at all. You two are as far apart as if the Grand Canyon was between you. So when you critically analyze copy, as I do a lot, and you see people leave out things, reassurances, proof, evidence, guarantees, full names and places of testimonials, all the things that we know to do to try and convince people that we and it are real. Often they're leaving it out because they don't feel like all that's necessary for their perfectly ordinary, perfectly rational, perfectly safe proposition delivered by a perfectly respectable and credible source. For a brief period of time in the infomercial business, it's about 20 years ago now, pros, big companies invaded. You may or may not remember, but big companies pretty much wanted nothing to do with sleazy late-night infomercials until everybody was making a lot of money. And then Phillips Electronics, the company that makes Electrolux. There were about 5 big— Sony, I think. There were about 5 big companies that all came forward and they all spent a ton of money. One of them actually paid Francis Ford Coppola, I think, to direct their infomercial. They spent a ton of money producing infomercials, and it was entertaining for those of us in the business to watch because they left out like all the proof. Why? Well, they're Sony. They don't need to prove anything. They're Sony. They're a respectable company. These other people doing these infomercials aren't respectable, but we are. We don't have to go through that. And so they didn't feel like their proposition was preposterous and they weren't credible, but they don't understand that every proposition is preposterous. Preposterous and nobody's credible. So one, if you get that every proposition is preposterous, then you do everything possible, of course, to help people believe what it is that you are putting in front of them. So to get exceptional numbers, to get exceptional results, it requires you to get that your prospects who aren't buying find you and your proposition preposterous, and therefore they can't quite bring themselves to believe. Right? So belief is where it's all at, and that's why you want to study people. So I've often taught the National Enquirer principle, right? So the National Enquirer principle is you want to study the ads in the National Enquirer. Why? Well, because typically it's an ad for some stuff that you can sprinkle on pizza and sundaes and then you can eat as much of it as you want and you won't gain weight and actually it cranks up your metabolism so somehow you'll lose weight while you're eating it. Okay, so it turns eating pizzas and sundaes into an exercise program. Okay? So Duquesne's over here trying to sell you sell lifting heavy balls, and these guys are selling a packet of stuff you sprinkle on pizza and eat, and the pounds roll off. They're back selling— I'm sure you've seen it, John— they're back selling the vibrating belt, right? This thing, they trot this out about every, you know, 5 or 6 years. The current commercial for it actually shows a person lying in a lounge chair with this thing on, and, and there's thermal, thermal complete proof that shows that this is going to give them these incredible abs laying in the lounge chair. Okay, now, okay, so we all laugh at that stuff, right? Why do we laugh at it? Well, because it's preposterous. It's clearly incredible, clearly unbelievable, right? Nobody would, but, you know, they sell a bazillion of them. Well, that's who you want to study. You don't want to study somebody selling something that you think is credible. You want to study somebody selling something that is ridiculous, that is clearly preposterous, because whatever it is that they're doing to successfully sell the ridiculous and preposterous, if you apply it to something that is not quite so ridiculous and preposterous, you will get even better results than they do. So the ones that are fun to study historically and currently are the marketers who are putting across the most difficult-to-believe things in the world.

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