Finding The 5% of Customers Who Will Increase Your Revenue By 90% w/ Steven Black #BrandBuilderPodcast

It's that easy. That's listening, that's getting people to talk. Because you're basically consistently surveying the entire market to continually improve your brand. And when you do that, you're also learning what kind of content they want to consume. So feed them what they want in terms of content and your product and you own them.

Welcome to the Brand Builder podcast presented by capitalism.com I'm Max Kerwick and I advise physical product brands to find their story.

I'm Ryan Daniel Moran and I invest.

In physical products brands.

A physical products brand is arguably the.

Most predictable path to a seven figure business.

And we advise them, build them, buy.

Them and sell them.

The show goes behind them, tracks their success and hands you the keys to what's working.

Let's dive in.

Hey, real quick. I'm doing a test in my business right now that I think you'll be interested in. We have a training called Million Dollar Brands. And and it helps business owners and entrepreneurs get clear on those first three to five products that they're going to build that will get to 25 sales a day at 25 to $30 and thus be a million dollar business. And we sell that for $297. And I recently had the idea of what if at the end of that training when somebody completed it and they filled out a form saying they know what their three products are going to be, they know how they're going to launch the products, let's refund them the cost of the training, let's incentivize the action of actually making some decisions in your business and getting clear on your business. And I did this because someone challenged me with the thought of what would I change in my business if I only cared about my customer's results and I didn't care about profitability. And I immediately said, let's incentivize action. And then I said, well, would I really spend however many thousands of dollars a month I spend on Facebook ads or would I take some of that money and put it into a scholarship fund and then fund some of the cool ideas that came from my training? And it was like this whole world of creativity opened up for me. So this is a test right now that we're running. If you are starting a new business or you are still under that million dollar threshold or even that 25 sales a day threshold, then we have this training called Million dollar brands. That's $297 and it's refunded to you when you complete the training. And I figure if you walk out of that training, you're going to leave with such a clear business plan that you're going to want to work with us on ongoing. So you can find this@capitalism.com brands. And depending on when you sign up, we're also opening up strategic windows where you can qualify for a scholarship and have your business funded. So this is all an experiment. If I lose my rear end on it, we'll probably shut it down. But for now, you can find it at capitalism.com brands.

Hey, guys. So on this week's episode of the Brand Builder podcast, I brought on Stephen Black. And the interview that follows is going to be really helpful. We'll cover a lot of different topics, but the main reason that I wanted to bring him on is because he talks a lot in his group and the content that he creates about this idea of social listening, and that is the idea of going and finding your customers where they are and just kind of observing them and engaging with them kind of in online areas and learning more about them and what they care about in areas that are specific and relevant to the niche that you're in. And I talk a lot about kind of more traditional market research techniques, you know, going out and actually doing interviews and doing surveys and actually talking to people. And I truly think that there's no replacement for that. But social listening is a great place to start if you're maybe not in a place where you have the time or budget or whatever to actually find people in your niche and go talk to them. And I also think even if you are at the point where doing traditional kind of market research, the stuff that I normally talk about makes sense that you still should be doing social listening.

On top of it.

So I asked Stephen to be on the show today. He is a really, really great marketer. He really, really understands Amazon and how marketing can feed into Amazon. And he's really kind of a no bullshit guy too, and has some great stories and some great techniques that he shares in this episode. And I think you'll get a lot of benefit out of it. So without further ado, we will get started.

How you doing, Stephen?

I'm doing very well, Max. Thank you for having me.

Absolutely, absolutely. You are the head of one of my favorite groups currently on Facebook. We just met recently at a conference in Vancouver, the ECOM Hub Summit with Tom Wang. But why don't you tell me a little bit about yourself and kind of what you're about?

Okay. So I have been marketer for a little over a decade, probably 12, 13 years now. And I have done. I started in the brick and mortar world and went from there. Did lead gen for some of my, some of my clients were fellow business owners and they were like, how are you doing this? So I did lead gen and then I got into E Comm and I have, I'm straight E Comm now. I did agency work for a while last year. In 2018, I worked with six different eight figure companies and one nine figure company as a consultant. Awesome. And my brands have taken off so much that I can't split my time anymore. But everything that I do is based around brand experience and driving repeat business like all the biggest businesses in the world do.

Love it, love it, love it. So this is going to be a great, great addition. And one of the reasons why I'm excited to have you on is because I think that a lot of the principles you talk about are useful for any size business. Right? Yeah. So a lot of times in E Comm and with Amazon specifically, we get caught up in chasing sales and this idea of focusing on customer retention is something that can transform your business. Whether you're just starting out or, you know, if you're already in the eight figure range trying to get to nine figures, it can be absolutely transformative. Transformative. So I would love to, you know, just from the conversation that we had before we started recording here, you have a very interesting origin story. So tell me a little bit you know, you talked about. Okay. Went from brick and mortar to started doing Legion to got into E Comm. What kind of brick and mortar business did you have?

So.

I, I had a hobby which was, which was dancing and ballroom dancing and I turned that into a career. I was a professional ballroom dancer for 20 years.

And so when, when I got to a point locally, I wanted to open my own business. I didn't want to work for anybody else anymore, have to rent floor space. So I opened a business. Had no idea about business principles or anything like that. But I had a pulse on the dance community. And if I wanted to open a business, my thought was it's not like everybody else that's going to come into the hardware store where I have thousands of people, I have a market of only a few hundred people and I need to get, I need to find a way and make a model to get them to buy again and again and again. And so what I set up was a tiered system to where I could get people in the door and then based on their engagement, they would raise their hand basically through, through, through the amount of Lessons they would buy to see who my 80% revenue generators were. But the only way that I did, yeah, I made them come to me. But the way that I did that is I based everything on, on experience. I wanted the, the entire way that things were taught, how they could apply it, how they could digest it in their home in between lessons. I wanted that whole brand experience to make it attributable to where everything that they were happy about had something to do with dancing. That was the idea. Because if I gave them that, I knew that they would chase me as opposed to me having to pay to have their attention.

So there's a lot to digest there. Tell me a little bit about when you're talking about brand experience.

You know, that's something that I think a lot of people who sell physical products have a hard time with. Right. You know, you think about dancing, you think about the experience of going into a physical store and you say, okay, yeah, I can, I can see how you would, you know, create an experience that once gets people wanting to come back. Right, right. How do you, how do you take those same principles and apply them when the experience is, I'm buying a product online and it's getting shipped to my house?

Right. Well, when you buy a product online, you're buying it either for utility purposes, like maybe you're buying extra trash bags or maybe you're buying kitchen utensils or something like that. But most of the stuff that we buy online isn't utility. It's based on an interest or a hobby. So let's say we're buying kitchen utensils. Okay, well, you like to do something in the kitchen. What most people don't understand is one of the biggest human needs that we will all pay through the nose for is inclusion. Nobody wants to feel ostracized. Nobody wants to feel like a dork. So if you're buying something mundane, like kitchen utensils, well, instead of me just selling you kitchen utensils, what if I have these social media, you know, channels, maybe YouTube, Instagram, Facebook, where you can go and you can be enriched and validated in your interest in that hobby. If you're, you know, a stay at home mom and you're buying kitchen utensils, people think that that's going to be pretty mundane. Well, how do we get you more excited about me being the source to fuel your interest and to validate your hobby? Okay, well, instead of just buying kitchen utensils, hey, we have recipes. We have a group of people that share recipes. We have a Group of people that are sharing cooking tips and mom hacks and everything else. Well, now I have a much bigger brand experience than just, I'm going to sell you some kitchen utensils. And so what I'll do is most people think about the purchase and E comm, I call that the bottom of the funnel. How do I control your perception before you get there? Let me have a social media presence, Let me have some content and value adders on my website. Because once we find source of information that we like and we can relate to and people are driving conversation and peaking our interest, we're not going to go to 47 different social media accounts. We're going to say, hey, I like this group, let me join it. I like this page, let me do that. And if you continually give to people, the purchase is not the end of the end of the line. The purchase is simply your customer raising their hand that they want to be part of your club. So make a club for them to be a part of. And what will happen is now if they want to buy something else, if you have a sale, you can sell it to that captive audience or if they want to buy again on their own, they know where they're going to buy from. You're the source. That's the idea. It makes life much easier and allows people to connect through social media and through, you know, the web, when otherwise they would live miles apart and perhaps live in isolation. You know, I don't have a mom club that I can go and talk kitchen stuff to that's inconvenient to my time. But if I can go on social media on my phone while I'm in the kitchen and I can follow a recipe that, you know, I'm in Arkansas and you know, Joan from New York made this cool chicken dish I want to try with the kids. Cool. Yeah. Great. And as, as, as the brand owner, I'm going to get myself or micro influencers or somebody to help me make content, perhaps even featuring my products to help drive conversation in that group. So everything is around content gen and giving and being the leader in keeping their interests moving in their hobby, validating their interests so that they'll buy from me.

Got it. There's a lot to a lot of things I want to go back to on that because that is, but that is some really, really good stuff. But I actually want to go back to one of the last things that you said, you said perhaps even featuring my product. So this is something that, like a huge mistake that I see, you know, physical Product sellers in general, but especially people on Amazon. Right. Who? There's this. The Amazon seller. You know, the negative stereotype that I'm going to play into here is that just like copying the playbook of whatever worked for someone else.

Right.

You know, and doing it quite literally.

Yeah.

But I see a lot of people who are like, okay, I'm going to. Okay, I need to make a group. I need to make some sort of community. I need to have some content. Well, every piece of content should be related to a product I'm selling.

No.

And then they don't understand why it doesn't work. They say things to me like, content doesn't work. Right. Content marketing doesn't work. Right. So talk to me about the. Maybe it has my product in it, maybe it doesn't. Tell me.

So this is actually very, very simple to explain and correct. Extremely simple. It's only. It only requires a few sentences. So get your. Get your notepads out, friends.

So, number one, your social media channels should not double as a secondary sales page.

Oh, my God, Preach. Say that again one more time.

Your social media channels should not double as a secondary sales page.

Do you guys hear that? Do you guys hear that? Okay, continue.

So, so if, if I go to your social media channel and all I see is.

Is products, products, products, and you're pushing products, okay, it's just another sales portal. I'm not interested. And what you've done in doing that, you have relegated yourself.

I'll use a term that all the Amazon sellers use. And in content terms, you've raced to the bottom. You've done the minimal work necessary, and now it is up to the customer. You're leaving it up to the customer to decide how they want to digest the information and perceive your brand. I think that's one of the dumbest things you can possibly do. You have to control their perception, shape their perception. Customers do not know what they need to know to buy from you. That's not their job. So it's your job to help shape their perception and connect why your product fills their need. They may not even be aware of your product or that they even have a need for it until they see some of the content that you put out. Now again, we just said that the first part of that is don't make your social media channels a secondary sales page. But what they should be is. It's one of those things. Let's see, how can I put this? If.

We'Re in a group and I give, give, give, give, give. If I just have like, say if I have a kitchen brand, I'm going to use that. I'm going to use that again if I have a kitchen brand or even better because this one's a little closer to home because I have family with this one. If I'm selling art supplies, paint, brushes, simple stuff. Okay, well, if my social media channel is just me selling my paint stuff, that's kind of, that's not going to get me anywhere. I'm the same as everybody else on Amazon. Instead, if I have a YouTube channel of tutorials.

Okay, that's much different if I have a Facebook channel of, you know, drawn out, step by step breakdowns. And that's what I do. And every so often I say, hey, by the way, guys, if you need more art supplies, go check this out. Because I've provided so much value, that group that follows me is, is infinitely better or infinitely more willing to buy from me versus everybody else. I want to control their perception and be there for them in their mind well before I ask them to make a purchase. Because if they know that I'm there and I'm going to give well beyond what the purchase is, they're going to stick with me. Everybody wants that kind of brand experience. Everybody wants that. It's like if you buy a Toyota and you go to buy a Toyota, okay, well, you might contact the guy ahead of time. You're going to set an appointment, you buy the car, he sends you a thank you and asks for a survey. Sound familiar? In the E Comm world? Yeah. Walk into a Rolls Royce dealership. Not kidding. Even if you have no money in the bank and you are nowhere near able to buy a Rolls Royce, walk into a Rolls Royce dealership, see what happens. The customer experience is infinitely different because they know it's a longer sales cycle and they're going to nurture the fire out of you.

Yeah. I think that's a really huge concept that people really struggle with when they're selling because they think it's a pretty linear path. Right. Okay. I show, you know, these features, they have these benefits. Here's why I'm better than my competitors, and here's the price. You should buy. Right. But that's not the way buying works.

Buying.

And especially, you know, when we're talking about building a brand, Right. There's this idea of, you know, you're essentially talking about if you're not actively branding yourself, you're allowing your customers to brand for you.

Yeah.

And why would you.

Silly, right?

Why would you surrender that control of this company that you're building of the products that you're taking all the time to develop and source and ship in and all of the things that you're doing, why would you then cede control of that story of.

I have an answer to this question, by the way.

Please have an answer.

The answer is that most business owners, be it E Com or be it brick and mortar or be it, you know, a service based industry, most people are what's referred to as artists. And Tony Robbins talks a lot about this. People are really good at doing their thing. So if, say you're a chiropractor, you're great at. You have this cult following locally of helping people.

Get over back pain, right? But maybe you're not the greatest marketer. Maybe you're not. Maybe you have no idea how to talk about why it helps so much versus the technicals of what you can do. Well, it's either they're an artist or in the E comm world, most people are lazy and trying to make a quick buck. And that's it.

Yep, absolutely. And I'm, you know, I kind of, I'm kind of on record on this podcast saying if your only goal is to make money, right? That is, there's no problem with that. There's no, you're not deficient, you're not inferior or whatever. There's like, that is a very noble goal to, you know, create money for your family and all that kind of stuff. But you cannot expect to have the same results as someone who is out there truly trying to make a difference in someone's life, truly trying to add value beyond the products that they're selling.

Right.

It's just, it's not an even playing field at all.

Well, it's like everybody's, I guess this generation's, you know, the younger generations, everybody's favorite entrepreneur is Gary Vee. And if you actually listen to Gary Vee, beyond his cursing, which I love by the way, because he's genuine to himself, but what he talks about over and over and over again on every TV show he's been on for the last eight years at least, is my business model is caring, giving a crap about people, give them a better experience beyond the product. And one of the things he talks about that I'm huge about is, well, before I get into a product or if I'm establishing a brand, I hold so hard to his $80 rule, it's insane.

I will find the $80 rule. I know what you're talking about. Familiar.

If you have a brand Whatever your niche is.

If it's art supplies, if it's.

Cooking and kitchen utensils and home goods.

If you're a chiropractor providing pain relief, it's not about what you do, it's not about the function of the product. People can read a brochure, your customers are coming to you because they need help connecting, why your product fixes their need. So the $1.80 rule, you find social media accounts to follow, be it Facebook, Instagram, whatever, and you leave your two cents, your reply on 90 posts a day.

Every day of the week. You do not take a day off.

Think about it, it sounds like so much work.

Well, if you're not willing to work, you're not going to make any money. Go get a job working for someone else.

Love it.

Love it.

Okay. Yeah, no, it is the truth. It is the truth, but sometimes you need to hear it again. Right? Okay. So that's really great. And that kind of takes me a little bit into the intended topic for today, which I wanted to talk to you a little bit about social listening. And just to kind of preface this for anyone who's listening here, you know, we've been talking about, you know, up until this point in this conversation, we've been talking about the importance of kind of creating value and for the customer to the point where they raise their hand and make a purchase indicating that they want to join a group, that they want to become a part of your brand, want to enter into a relationship with the brand. Right. Not that they're just making a one time purchase, that they're never to come back.

Right?

You can't come, you can't create that experience if you don't understand who that person is.

And here's something that, here's a tag that people can relate to and that they should remember.

You have to be a better student of your niche than your students. You have to know your niche better than your customers.

Love it. Love it. Tell me more about that.

All right, so.

If there's, there's two ways to go about marketing or selling or branding or whatever you want. When, when you're exchanging, you know, goods that you've created or curated or whatever in exchange, you know, for money from someone else, you can chase the market and try to figure out, okay, well, I want to sell this, I got this great idea, I think this is great. Or you can make the market chase you and that's social listening. What you do is if you're interested in building a brand around a niche that you like say you want to make a computer accessory, right? Something that will help people. You know, you want to pander to the gamer crowd because that's what you like to do. Okay, cool. If it's a passion of yours, you're going to be more likely to spend time researching it. So when I was doing brick and mortar, and I know Max does a lot of this too, you go out, you actually talk to people. It's real market research, right? Imagine that you're actually going to talk to people. You're going to go to trade shows, you're going to do all that kind of thing. For me, when I was building my dance studios, I went out and I danced where all the other dancers were. I found the salsa dance place. I found where people were doing country dancing. I don't even like country dancing. But I figured out what they wanted, why they congregated there, what each of the classes had in common, versus some of the things that I was used to doing. And I said, oh, this is what everybody wants. Versus some of the things I thought they wanted because I enjoyed them. Let me shift my model to mirror more what people want. And when I did that, I mean, I broke it. I had so many people coming to dance every single week that the landlord of the strip mall I was in, we had to renegotiate the lease because the Thai restaurant that was in the same shopping center, they had no parking on Friday night for people to even come up and get their to go orders.

Wow.

I shut the place down every single. Every single week, I shut it down. And my landlord caught so much fire from. From the Thai restaurant owner. Cause I was basically shutting down his business that we had to renegotiate my lease.

Wow, that's awesome.

And all of that was because I spent time figuring out where people were. And when I went to those places where people were, I could then see the commonalities of why they would spend time there. If you're online, you have an infinitely bigger pool. You can go to Facebook groups and join them and just contribute and listen. You can, you know, go to YouTube channels and say, okay, this is what people are liking. This is why they're subscribing. This is why this engagement is so high. Same thing with Instagram. And all you have to do to get people to start taking notice of you is don't try to sell anybody. You have to contribute in those groups on those channels consistently. And people will say, hey, you know something, who are you? And say, well, I have this and that and the Other. And if you become. And it doesn't take long, actually, it takes, you know, a couple of months maybe. But to where you're a consistent voice and people know who you are, people are going to message you, people are going to try to find you. You can even reach out to that group or channel owner because they've probably taken a notice of you as well and say, hey, by the way, I have this thing, and I think it would be a good fit for the group. Would you mind if we did something together? And now you have that captive audience that knows you, and you've already gone on your back end and adjusted your products based on what people are going to want so that when you offer it to them, it's a done deal.

Love it.

Love it.

There you go.

So, yeah, I mean, boom, I'm sitting here just like my mind's racing a million miles a minute. Even though this is also very, very similar to what I talk about so very much on the same page, just in terms of going out. But there's two portions to this, right?

Yes.

And I'm going to bring it back around to E. Comm. So you're talking about, okay, you're starting your studio and you're going out there and you're going to places where people are. Right. You're having conversations, you're talking to them, you're adding value.

Yeah, because that was the only way I could socially listen and figure out what they wanted. That doesn't happen online.

Exactly, exactly. So that's what I want to bring about.

That was specific to what I was doing.

So for in an E commerce setting. Right. So you're talking about joining Facebook groups and things like that. But what are. And also, the $80 rule is a great kind of example of ways to change. You can kind of do this, but.

How? Like, what's the easiest way for someone who's just getting started in social listening, you know, regardless of what size their business is, like, what is the easiest way to kind of get started? If they were going to take one step that would, you know, have the biggest kind of impact on their business through social listening, what would that look like?

Facebook groups.

Facebook groups, without question.

Not a YouTube channel, not an Instagram following a Facebook group. And the reason is because how people engage on YouTube.

They watch their favorite channel and they'll leave a comment, but that's it. They don't really interact with each other. Same thing on Instagram. We have a short attention span. I can comment, but you don't really get to Know, the repetitive comments. Some people listening to this will remember, some people won't. But, you know, 20 years ago, before we really had gigantic Facebook groups, we had online forums.

So if like, you.

If like you had a car that you were interested in and you wanted to. To modify it or wanted to meet people with other kind of cars to kind of validate your interest, there were forums on how to repair your car, how to modify it, different things people were doing. Now it's Facebook groups. So if I go back to the example, to keep things consistent, say you were going to do, you know, you were interested in branding some, some version of computer part, right? I'm not talking about like a new computer or a graphics card. I'm talking about like a case accessory or something like that. Something simple. Right? Well, okay, where do those people hang out?

Where does your audience hang out? If you're going to go and hunt an audience, where do they hang out? You know what I mean? If I'm going to chase down the computer crowd, okay, what are the gaming forums? What are the PC building forums?

What are the.

Oh, there's this thing they like to do called water cooling. Where are the water cooling forums? Oh, well, they buy from these guys over here because they do custom work. Well, let me follow them too. And you just start listening in the groups and commenting and asking questions and offering ideas. And it doesn't even have to be amazing. It's not like you have to knock people's heads off with your insight. You're learning on the fly. And just by contributing and commenting consistently, they're going to see that name come up over and over and over and over again. They're gonna reach out to you. That's how it works. And if you want, if you get in, you know, good enough with the page owner, the group owner, have this happen all the time with some of my niche groups that I have. Somebody will come along and say, hey, I know you offer this over here. I offer something like it. We're not. We don't offer the exact same thing, but we offer complimentary items. Do you want to run a group promotion together to your group? Yeah, sure, no problem. It's super duper easy. So you can be on the other side of that. Instead of having your own big group, you can say, hey, you know, you guys offer this and I offer this accessory that you don't offer. You know what, what can we arrange? Can I pay you a few hundred dollars or whatever it takes to run a promotion in your group and, you know, whatever and it, nine times out of 10, that works. People like money. Yeah, that's one of the things. People with these big Facebook groups, a lot of them don't know how to monetize it. So if you approach them and say, hey, you have, you know, you have some thousands of people here that are engaged. What if I paid you this and we promoted our stuff together in the group and offered it like a bundle deal, maybe they'd go, oh yeah, that's a great idea.

Sure, yeah, love it.

That's, that's the whole idea. I mean, and just to keep the example going, because I've looked at it, let's say you wanted to sell those computer accessories. That's, that's the niche, right? Yep. Well, okay. If you look at some of those pages and those groups, those guys aren't selling everything. And most of the time they're not promoting their products, they're saying, hey, I'm doing this custom mod to my PC. Hey, here's the progression of this water cooling loop I'm doing. Hey, I painted this. What do you guys think about that? And they're engaging with the community and giving people content to consume because that content is going to inspire people to do something with their interest in their own life. That's how you hook people.

Yes, yes. And I love the example of PC gaming too, because that's an area, and to an extent ballroom dancing as well, where it's not a mainstream hobby. Right. That's not something that everyone is going out and talking with all of their friends about every time they're in public. Right.

It's something, it's the whole point. Because the reason I like those two is because those two examples are like, they're off putting like ballroom dancing, I think tail suits and old person music and my grandmother and like PC gaming, those are the nerds that you know are pimple faced and sit in their mom's basement and obsess over frame rates on their monitor like weirdos. No, they're like by the thousands online. And that inclusion in a common meeting place without me having to physically go somewhere because we're all connected digitally. If you can capitalize on that. And it's not hard to do that. Men, do you win? You can take anything and do that.

Well, there's two elements to that. So the first is right when they come in and you give them a place and a community. Right. You get both connection, connection and belonging. Right. Which is something that's lacking if you.

Do that, if you can give them that. I Promise you, even with a decent product, you're going to sell the hell out of it.

Yeah. Because the emotional connection that they're making is not with the product, it's with. This is the place where I got, where I found that connection and belonging.

Well, also, their perceived value of the product itself is going to be tied to how vested they are in your group if they think that you put out quality content and you provide a quality experience. Well, what you put into your product must also be quality by default.

Yes. Which. Ding, ding, ding. Let's talk about higher prices and not being price sensitive and not racing to the bottom and all that kind of stuff. What Stephen just said is the key to protecting your margins as categories get more competitive. Yeah.

Well, here's the thing. Let's talk about competition and why pricing people race to the bottom.

There's a couple of things here I guess we should chew on because it's come up recently for me. Number one, most people that are new to business, you're going to feel funny asking people for money.

It sounds so simple, but it's so true.

I have a fix for that. Stop apologizing for being in business.

Do not make customers decisions for them. Let them spend their own money how they see fit. Do not apologize for being in business.

Yes, exactly. Yes. Love it.

So there's the part of that, the first part of it. As far as pricing goes.

I think of pricing wars a lot. Like a relationship, A man is only insecure if he knows his woman can do better. So I'm only insecure about my pricing and needing to drop my price and desperation. Because that's what price dropping is, is desperation. Because I don't believe in my product enough to ask people to buy it. So I'm going to drop my pants and do whatever I can to maybe get people to buy it. So maybe I recoup my investment. Maybe I even make a little profit and I can live a little bit of a different life and not hate my existence so much.

Yes.

That's what price dropping is.

I. Yeah. And I always tell clients that if you are competing on price, it's because you failed to create value in the minds of your business.

And the thing is, people think. And that's. That's another. Like, that's another one. We should, we should, we should dig on. Value is not price bundling or price manipulation. And people, people think value means like offering like a two for one. That's not value. It's not value at all. Like, I'm going to go back To Rolls Royce. They don't discount those cars. Not a big deal. Never, never, never, never, never, never. But the thing is, do you know the common lifespan of somebody that buys a Rolls Royce when they buy a new car?

I'd love to know that.

18 months.

18 months. Same thing with other exotic cars. And the dealers are set up that way. They know they're going to have a small client base, you know, probably 50 people, and they have to sell them a new car every six to 12 months to keep in business.

Wow.

That's how that works.

Yeah. We're talking about cars that cost $400,000 starting price, right? Yeah.

The Phantom i1 is actually 565, but.

You get Dallas Auto show last week.

Gracious mercy.

Oh my God. It was a beautiful, beautiful, beautiful idea.

The idea is you don't have to have some gigantic thing. You don't have to have some monster premium business. It doesn't have to be hoity toit. Just, you know, a premium, A premium user experience is you actually talk to people. Here's the easiest way to provide a premium user experience while you're figuring out content. Super simple. But oh my God, it's going to win. If somebody purchases from you, send them a thank you video. Ah. That's all you got to do. Like, I don't get to all of my purchases because I run so much volume, but I do about. I mean, I have a generic thank you video, but I do about 50 personal videos every morning.

Wow.

First thing, it's 4 in the morning, so. Hey, I'm Steven Black, CEO of XYZ. Thank you so much for buying. Blah, blah, blah, blah, blah, Whatever they actually bought. And I say their name on the video, say, I just wanted to thank you. If you have any problems, please get a hold of us. The link is below. We'll make it right immediately. We'd love to see you. In our Facebook group. We have a bunch of people, they all talk about all this kind of stuff. And because you're giving them that experience, they go. They're going to do one or two things. They're going to go, holy crap, I love this. Or number two, they're going to go, this guy's full of garbage. And they're going to go to the Facebook group and you'll say, there's no way. And they're going to see how active you are with your customer base.

Yep.

And then you own them. Because nobody does that.

Nobody does that. And it takes a lot of work. I mean, that's the thing that's why nobody does it. Right. It's because it takes a lot of work. But the advantage of that, over an.

Hour every single morning.

Yeah.

And you know what? If you increase it's. And Max, I know you did a huge, your background is huge amounts of market research. You can confirm this. But the big gigantic research firms that have like millions of dollars for market research have done studies on this. And I was telling you this earlier. If you increase your customer retention rate by 5%, you can increase your revenue by 90 and it'll be at least 25%. So whatever you make per year by increasing your customer retention rate even 5%, if you keep five people out of 100 sales and you keep your brand in front of them, you're going to make a quarter more money this next year.

Yeah. Which is mind blowing.

Right?

That is that it sounds. Those numbers sound made up. But they are true and they are true in every business that I've seen that focuses on lifetime value instead of just acquiring sales. Right.

Yeah. Acquiring sales is entirely too expensive. I'd rather face me.

Yeah, exactly. Exactly. And that's, you know, coming back to our conversation earlier. That's the power of getting someone to raise their hand and opt in. Right. They want to give you that money. Right. They want to buy the product. They want to become more engaged because they see value in what you're providing, both in the products that you sell.

So one of the things that I do if we're going to keep it to E comm is if you add to cart or initiate checkout.

I'm not worried about the buying part. What that says to me is, hey, I'd like to talk to somebody. I need a little more information to go across the goal line. Oh, okay. Your abandoned cart sequences. Like if you're an Amazon seller, you can't do abandoned cart sequences. You're losing 30% of your revenue. Yeah, like that's a lot. If you're making a million dollars a year on Amazon, you should be making a million three at least. But you're not doing abandoned cart sequences. You don't control that. So when I have my regular E commerce stores, my Shopify stuff, my abandoned carts and my initiate checkouts. Okay, cool. They need to be nurtured a little more. They need a little more information to get across the goal line. Maybe they're hesitant. Maybe it's the first time they've bought something like this. They need to know that we're not just another, you know, they need to know they're not just A number. And okay, great. When they buy something cool like we've talked about, they're raising their hand, they want to be part of the club. We got to give them a part of the club to be. To be a part of. You got to give them a club to be a part of. And those videos in the morning that I talked about, that's me telling them that the club exists. It's like, hey, it's really this great. Come and find us, you know, we'll be happy to talk to you and make your life even better. So when you can provide people that experience. Okay, cool. And people talk about, oh, it's a lot of work and I got to do this. Okay. But if you make an effort every single day, if you say, look, maybe I'm not going to do a million thank you videos, maybe I'm going to have one generic thank you video that I mail to everybody, that's great, great place to start. But if you make an effort to post.

Or to make a little bit of content and schedule the post in your Facebook group, have something going up every day doesn't have to be massive, just something that sparks interest. And the thing is, if you're hesitant because of creation, a lot of people are like, oh my God, what do I talk about?

Yeah, this is what I was going to ask you about.

I don't know what to create. Great. Don't create. Curate.

Yes.

Go to blogs, go to other places in the industry. Go to Pinterest, go wherever and find an article. Link to it in your Facebook post. But tell people, hey guys, let's talk about the computer niche.

Right?

Like I was talking about before, because that's an easy one to kind of jump down. Hey guys, I found this article. Have you guys seen, you know, they, they delidded this thing over here and they got some pretty wild results and they're talking about how it's going to affect some of the games coming up and blah, blah, blah. You guys should check it out. It's not that you wrote it. That doesn't matter. It's that you were the guy that they look to to bring more attention to their interests. Oh, yeah, I should go check that out. That's pretty cool. Now I know now I can have another conversation with my fellow geeks if I'm a stay at home mom and I'm doing kitchen stuff. Oh, man. Hey, it's Friday night and we're doing Mediterranean month this month. So every Friday night we're going to feature a new Mediterranean dish. Okay, cool. I'm not going to invent the damn Mediterranean dish.

Yeah, exactly.

I'm going to go on Pinterest or I'm going to find somebody, I'm going to say, wow, this is amazing. And I'm going to give them credit. I'm going to post it. Hey, guys, here we go. I found this. I've tried it. It's easy to make. It doesn't take too long. Your kids will probably love it. Check this out right here. And they're gonna go, oh, man, that was the greatest dish. Can you put that in the unit section? And even though somebody else wrote it and made the content, because you were the one that brought that to them, now you're the source. You care. You're not asking them to buy something to get access to that information. You found something they didn't. You are leading them deeper into their hobby, being more enriched. And the more they spend time in their hobby, the more stuff they're going to need to buy for that hobby. And if they buy it from you, you win.

Yep, absolutely. And I think that, I think that's huge. Huge, Huge. You know, if you're, if you're listening to this, go back and rewind, you know, three minutes and listen to that again. Because the real, like in a perfect world, obviously the entrepreneur is someone who is, you know, hugely interested and invested in the product area and knows a ton about it and everything. But the reality is, especially when you know a huge portion of the people listening are Amazon sellers. And a huge portion of the people who sell on Amazon don't actually know that much about the area that they sell it.

No. And I know you've dealt with people that sell huge amounts, but they have no idea who their audience is.

Exactly. Yeah. Because Amazon, that information, they don't want you to know. Right, right.

And their only presence is Amazon, because you can make good money on Amazon. But it's when you get off of Amazon and start building that bigger thing, that's when the brand happens. If you have the goal of building something and selling it, it's not going to happen on the Amazon platform. You have no assets, you have no customer base to give people. You have no system of business. You don't have no social channels with engagement. Somebody wants to buy that business, they want to pick up a ready to go, cash generating asset. Not something that, you know, kind of works in your head and on a single platform because it'll be shut down tomorrow. Exactly, exactly. Exactly. So you don't have to be overly creative. I know A lot of people that aren't. But if you can curate and you can put a spin on it as to why people should be interested in it and be the source of the information, you're gonna get more sales. And guess what? If you're an Amazon seller, having a group is the best way to launch. Because you can launch at full price.

Yes, exactly. You don't have to again, you're creating value so that you can justify the price that you're selling at. You don't have to give things away at 90% or whatever, which no business would ever be sustainable at. That.

I never do that. I think the 90% giveaway thing, it's a holdover from four or five years ago when you could do 90% off giveaways. And just the sales velocity itself is what drove ranking. Whereas now.

Here'S the thing we talked about lifetime value and all that kind of thing. Here's what you need to know. The higher priced items and the more, the more monetization you can drive with your sales velocity to the Amazon platform, the faster you're going to rank and the more stable your rank is going to be. The reason is because Amazon is a drug dealer. They're capitalizing on lifetime value. The prime program that they have set up is they're going to lose money on shipping to keep you on the platform. That user experience is insane. And what happens is they know based on your average order value, how much lifetime value you're going to have as a consumer on the platform. So if I'm sending people to the platform and they're getting 90% off and not really spending much money, well, they're not going to be very big lifetime valued customers. I'm not going to get as rewarded for that on the platform as if I'm sending people full price secondarily to that is, if you are giving people a huge discount right out of the gate, where do you go for your sales for the year? Where do you go for Prime Day and Black Friday?

Yeah, yeah, exactly, yeah. And if you train someone that something costs some ridiculously low amount of money, you're never going to get them to come back and pay, you know, five, five, ten times that.

No, there's no way. Here's something interesting for you. Let's talk about.

Let'S talk about why higher priced items get better reviews.

There's one for you. So if you sell your item at full price or even a higher price and you can justify that and get people to buy it, people are more likely to leave A review because one, they have more value for it and number two, they have to talk about it to validate in their mind what. Why they spent that much money on it when there was maybe some version of an alternative. I like the Sonos line of home theater speakers.

Yep.

A Sonos play bar is $700. Okay. You don't think I can't find some version of a WI fi speaker for 100 bucks? Probably. But if you go look at what everybody says about Sonos, everybody rants and raves about it. Perhaps it's because they have amazing quality. But. But a lot of that is because, hey, I had enough value to spend money on this and I need to tell people and convince other people to spend money too, so I don't feel insane.

Yes, absolutely. And we could probably do a whole nother podcast on kind of the consumer behavior, the consumer psychology behind why that happens. But it is absolutely true. And all you have to do is go look at higher priced items. And especially, you know, the kind of name brands like Tonus. Right. Where you're buying, you really are buying into a group of people. It says something about you as a human being that you choose sonos instead of $100. Random brand speaker.

Lily Pulitzer is my favorite example of what you just talked about. I love Lily Pulitzer and how they do this. Lily Pulitzer sells $400 dresses and they never have a sale except for one day a year and it's usually Black Friday. Okay. If you can't afford it, they don't care. They'll find people that can.

Yeah, they don't want you if you can't afford it.

It's something about being able to afford that $400 dress and have that tag on you that makes you feel like you've accomplished something almost. That's the idea. You've done something to where you can say, hey, I can do this. And you're going to show it off and you're going to tell everybody how much you love your Lily Pulitzer dress. Even if you have a Target dress that fits you better.

Yep. I have another brand that is actually not exactly on price that they differentiate this way.

Yeah.

But I only know this because my wife sometimes shops at the store, but it's a store called Brandy Melville. They only sell one size of clothing.

Oh, wow.

It's clothing. And the size is between a women's two and a four. And if you don't fit that, they don't want you.

I love that.

I know, I hate it as a human being, but as a marketer and a brander. I'm like, God, that is fucking genius. Yeah, it's great. So, I mean, there is nothing quite like that in terms of planting a flag in the ground and saying, this is who we're for.

Yeah. And so we need to talk about this too. Especially for the Amazon and E Comm guys, when you talk about differentiation, it is not about adding more of the same crap. It's not about adding a trinket. It's controlling their perception before they get to the product page. So if we stick with Amazon as a platform, when they get to the product page, if that's the only information you're giving a customer to make a buying decision about your product, well, it looks the same as all the other ones and you're leaving it up to them as to how they're supposed to interpret the information. Whereas if you have some version of outside content, you've already tainted their mind to lead towards your brand. I always say that by the time I get somebody on the Amazon platform on my product page, I want my product page to just serve as a last little checkpoint to say, oh, yeah, okay, that's what I want. Check out, done to my mailbox in two days. I don't want them to have to make any version of a decision, because all that's going to happen if that's the only presence you have will now reviews as your currency. And that's why it's so important in the Amazon community, because if you're not making content, you're leaving it up to people. And people don't want to think they're going to look at the reviews and say, what did everybody else do? Well, they bought this one. Yeah, I guess I'll buy that one, too. They need to be led, so lead them properly with your own content. And here's the thing, here's something nasty. If you're not making content, I might make content for you. Don't think that if we're competing and we're neck and neck and we're really going at each other, I'll buy you a drink at the bar. But if we're in business against each other, I'm gonna take your head off. I might quote, unquote means I will.

Theoretically, yeah.

Oh, no, I'll go ahead and bid for this because I'm just the guy. I might run a piece comparing your product to my product and how good your product is, but how mine shines just a bit brighter, and I might farm that out to four or five or ten influencers. And have them run the same piece. Now, who controls the perception?

Nasty. Nasty. But yeah, yeah, you are, you're, you're, you're controlling the narrative there. Right?

Because that's content. People are going to want to think, oh well, I seen this one and I seen that one. Do I do Listerine or do I do Scope? Which mouthwash do I do? Well, I'm going to compare them. Oh well, some objective third party person is going to compare them. Who do you think paid for that review?

Yeah, exactly, exactly.

And it doesn't have to be that cutthroat. And honestly, people think about the competition and all that kind of thing. I don't worry about my competition. I don't care what they're doing. It doesn't bother me. I never, ever, ever think about my competition. I, I might find out what angle they're taking to sell to the audience so I can take a different segment to the market or I might do it better. But I'm more worried about what my customers want, what that segment of my audience, what they're talking about. Oh, hey, we'd like to find something like this. Really? I bet I can make it.

Yeah, exactly.

Let me offer that. So if you always focus on improving your customers interests with, with your brand and your product and you drive content that way and everything is about customer, customer, customer, you have no competition.

Yes. I love it. And that, that brings it back around to, that brings it back around to social listening. Right. And this idea of like you can listen to what they want from a product perspective. You can listen to the messages and the content that they're responding to positively and use that as the starting point for your, your messaging. You can listen to the way that they talk and the words and phrases that they use and that becomes a jumping off point, copyrighting.

And here's, and here's something for you as well. Do not be afraid to put an idea out into the group for negative feedback. Do not buy into a product until you have asked the market what they need and what they want. I have many, many times that, oh, I see an angle, I'm going to get this product going. This is going to be amazing. I'm gonna make a ton of money on it. And I go and I ask before I even prototype and I say, what do you guys think about this? And everybody goes, that is the dumbest thing I've ever heard of. And here's xyz. And it's all this stuff in the way that they use their, their, the stuff in their interests. As to why they'd never ever use a product like mine. And I go, thank God I asked.

Yes, yes.

They don't have to know that I was gonna have a product. What if somebody did some. What if someone did something like this? What if someone, you know, that they.

Yeah.

Yeah. What if someone did something like this? You know, maybe I should check something like this out. And everybody jumps on you on social media because everybody needs to be a keyword warrior and say, no, no, that's, that's dumb. Or it should be like this. Okay, well, let them, let them talk and come to a consensus. And when they figure it out, you say, hey, you know what? I know you guys are talking about this. I'm going to offer something like that. And I, based on what you said, I figured out a way to improve it. Bookmark the thread, make your own little save on Facebook. And you say, okay, cool. Now this is kind of the angle I need to take here.

Love it.

It's that easy. That's listening, that's getting people to talk. Because you're basically consistently surveying the entire market to continually improve your brand. And when you do that, you're also learning what kind of content they want to consume. So feed them what they want in terms of content and your product, and you own them.

Love it. Love it.

There you go.

Okay, Stephen, this has been really great. Where can people find more content from you? Where can they follow you?

Pretty simple. All you have to do is look up Unstoppable FBA on YouTube and on Facebook. Simple as that. I have a group for Amazon sellers. All we do is talk about marketing. It's called Unstoppable FBA. It's marketing hacks for Amazon sellers. We have about 4,000 people in there currently. Everybody from brand new people all the way up to people that have sold eight figure businesses. And so that's an easy way to do it. And I put a ton of content out on YouTube. It's very different stuff than what you're normally going to hear about Amazon because it's actual marketing stuff and business talk.

But I mean, I write articles, I put stuff out. I'm just happy to help whoever wants to know. So there you go.

Awesome. And I can attest I'm in that group and it is one of my favorite. Just in terms of content. Stephen does some really great stuff.

Hey, brand builders. We hope you enjoyed this podcast by capitalism.com. check out our website for upcoming events and additional content about building businesses, building brands and investing.

My name is Max Perwick and My.

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