How To Charge Higher Prices & Attract Your Best Buyers w/ Max Kerwick

So storytelling and brand stories are the things that allow you to command higher prices. Right. And this is the thing that we're implementing and the brands that I work on with Ryan. Right. And this is the thing that has allowed us to increase prices by around 40%.

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 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 my business if I only cared about my customers 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 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.

Please give a huge round of applause for Max Kerwick.

Okay, cool. So, like Jeremy just said, I have experience working in a lot of different industries. I'm a brand guy, brand consultant, and I work with a whole variety of different companies and a lot, a lot, a lot of E commerce over the past couple of years. And so I met Ryan, God, probably a year and a half ago, and I've been working with him pretty consistently ever since. And so this presentation is called how to charge higher prices and attract your best buyers. Because that's really the dream, right? When you bring the exact right people to your business, to your store, to your online retail environment, right? They will willingly and happily pay a premium price to buy from you, right? They will share with their friends, they will come back for more. They will buy everything that you sell, right? And that's really the dream. And so what I'm going to do is I'm going to walk through kind of the process that works across all of the industries that I've worked in, right? It works in E commerce, it works in finance, it works. Doesn't really matter, right? And it's the process that the best brands in the world use to create a story that resonates with their ideal customer, right? And this is the same process that we're using. I consult with Ryan on a lot of his businesses. It's the same process we're using there. And it's the process that we've used to, you know, we've been able to raise prices by up to 40%. We've been able to decrease the number of discounted sales we have by over 50%, all while either maintaining or improving profit margins. So this isn't going to be a traditional case study in that sense. This is really the process by which you can create a brand story that then informs all of the experience stuff, from creating the product experience to the retail experience to all that kind of stuff. So before I get started, I'd love to get a sense because I honestly don't know how many people here sell on Amazon as their kind of their primary sales channel. Okay. That's kind of what I thought. But I wanted to make sure I'm going to kind of poke fun at Amazon a little bit during this presentation. And I want to say up front that I firmly believe that Amazon is the best place in the world still to launch products profitably, to acquire cash flow and to scale a business at the start, right? But I also think it's probably one of the worst places if that's the only place that you sell to build a brand, right? And because Amazon is very, very intentional about incentivizing you to chase acquiring sales over acquiring customers, right? They don't give you access to customer data. They make it very hard to form a relationship, and they standardize everything across your listings, right? So you're basically reduced to a commodity, right? You're competing on price. It makes it very hard to charge those premium rates. And so what I would like to do is kind of walk through the things that you can do to build your brand on and off Amazon, and then I'll kind of go through some specific things that Amazon is doing and how you can kind of push past that. And the example that I like to use to kind of show how Amazon does this, or the proof point I like to use is how many of you, when you buy something from Amazon, right, You have this cool new product, say it's a supplement or skincare product or a jade roller or whatever it is, right? Someone says, hey, that's really cool. Where'd you get it?

Right?

They never say your brand, right? They say, oh, I got it on Amazon, right? And Amazon gets to steal all that equity. And so the whole prop. The whole point of brand, the whole point of going through this process is not only to command the higher prices and to attract your buyer, but really to start forming that relationship so you're not dependent on them for acquiring those sales.

Okay? So as someone who brands companies for a living, I get asked about the same brands all the time, right? Apple gets brought up all the time. Nike gets brought up all the time. More recently, Lululemon gets brought up all the time. And the. Do you think that these brands have those same problems that we just talked about, like not knowing who their customer is, not having a relationship with their customer, competing on price, like, obviously not, right? And it's easy to sit there and say, okay, yeah, those are billion dollar companies. That's billion with a B. That's not really a fair comparison. But the process that these brands use to form those relationships and to create those brand experiences is something that you can start doing immediately. So what is it that makes those brands so successful? Is it supply chain? Is it great design? Is it a logo or a fancy tagline? I mean, yes, it's all those things, but all their competitors have those same things too. Reebok has all the same things that Nike does and Adidas and all that kind of stuff. The thing that makes the best brands in the world stand out is that they know exactly who they're selling to, right? They know everything about their customer from basic demographic stuff to behavioral to like motivations, what they're trying to achieve, how they see themselves as people, how they're trying to present themselves to the world, right? And they're able to take that information and create a brand story that resonates in the hearts, minds and most importantly, the wallets of those same customers, right? And then the last piece is taking that story and applying it consistently across everything that the customer comes into touchpoint with, right? And that's really where the stuff that Katherine was talking about comes into play, right? Because you're creating a consistent experience. Every time that a customer comes into contact with your business is an opportunity to either strengthen or weaken that relationship. So that's customer service, that's your follow up sequence, that's the listing, that's the ads that they see. Everything. If you go super direct response and you just are always doing sales, always doing sales, always doing sales, always doing sales. And then you know, you're trying to sell this really high end image, right? There's a disconnect there, right? And that, that weakens that relationship, that weakens that brand experience. So this is what the best brands know and this is what the best brands do. So the first part of this equation is attracting your best customers. And I know at the beginning, you know, it said charge higher prices and attract your best customers, but you can't charge higher prices unless you attract your best customers, right? And so the first rule is identifying your best customer knows requires knowing everything about them, right? I don't know how many clients I've sat with, specifically in E Commerce, where we start out and we're sitting in a room and I say, okay, who's your ideal customer? Who is the customer that is going to be most predictive of your success going forward, right? And they say something like, oh, well, we like to sell to busy moms. Okay, what does a busy mom look like? I say, oh, well, it's women. This is usually a dude talking, by the way. It's women age 35 to 55. They have 2.3 kids probably live in the Midwest, really crunched for time and they have enough money to buy my product.

Thanks for that last point. That was really helpful. But that is a very limited set of attributes that doesn't tell you anything about who that person is. That's not even very useful for targeting purposes, right? I don't know what that person is interested in. And that could be. There is a 55 year old professional mom that has a 20 year old and a 22 year old that are both out of the house, right? And a 35 year old with 4 kids under 6 that are included in that same thing. And you cannot tell me that that person is trying to tell the same story about their life, right? So what the best brands in the world do is, is they go deep on who they serve, right? And they really think about it as serving. So they find out all that, the long list of demographics and all that kind of stuff. They track their behaviors online and see what they respond to and see what they don't. They have actual conversations with them and try to figure out what motivates them, what causes them to make a purchase decision, what is the story that they're trying to tell about their life, right? And that goes into the second rule, which is people use brands to tell a story about themselves, right? In a vacuum, if no one else exists, you wouldn't give a shit what clothes you wore, right? You'd probably just walk around naked. But because you're around a bunch of other people, you very carefully curate this selection of brands so that you can signal to others, this is what I'm about, this is who I am, right? And so the best brands realize that they go after their customers and they figure out what is that story that our core customer is trying to tell to other people, right? They figure that out and they figure out what is the role that we can play in that story. And then the last rule, and this is pretty basic, pretty marketing, one on one, but it still has to be said, if you try to serve everyone, you will end up serving no one, right? And this is especially, I run into this all the time with E commerce clients, right? Because it's so tempting to say, well, I sell spatulas and everyone needs spatulas, right? Well, if you try to sell everyone, you're basically trying to be like the folgers of spatulas, right? And who wants to be the folgers of spatulas, right? You want to, you want to go after a very specific market. You want to be for a specific person. And so this, you know, this is pretty hideous PowerPoint graphic here, but the thing that the best audience or the best brands do is they build for a core audience, right? They realize and go about this very intentionally that if they target the people who are the most interested in them, who have a story that bonds with the story that they're trying to tell as a company, that there's this outer ring of people that are interested and inspired. They might not look exactly like that core customer, but they look like 50, 60, 70% the same. They have some shared attributes and they're going to respond to the message anyways. You don't have to target those people specifically. You target the core. And then you have this other group that's going to kind of see that as aspirational and they're going to join. And then that outer ring, the uninterested and uninspired, you get them or you don't, but you don't waste time, you don't waste money getting, right?

So then that's the part about acquiring audience, right? You go deep, you have conversations, you figure out who it is that you're serving, you figure out the story that they're trying to tell about their life, right? And you are very intentionally pursue that and very intentionally pursue serving that person so that they can continue to come. Come back to your brand, right? So then how do we charge them higher prices, right? You can do all of the customer work in the world, and then if you just try to sell them a product, right, you're still gonna. You're still a commodity, right? You're still gonna be in the same price battle that everyone finds themselves in when they do that, right? So storytelling and brand stories are the things that allow you to command higher prices, right? And this is the thing that we're implementing and the brands that I work on with Ryan, right, And this is the thing that has allowed us to increase prices by around 40%. So this is going to kind of get into my core methodology of branding, right? But great brand stories address every level of their customer need, right? And that's why we start with that ideal customer piece, because we need to know the customer, because we're coming at this from the customer perspective.

I'm a consultant, so I think in pyramids, I just can't help it. And this pyramid, the brand value pyramid, is. Is modeled after Maslow's hierarchy of needs, right? So you probably took a Psych 101 class at some point. And at the bottom of Maslow's hierarchy are kind of the baseline needs that you need to satisfy as a person to live, right? Food, water, sex, sleep, shelter, right? If you are not satisfying those things, you're going to be pursuing them and you won't be able to focus on anything else. Once those needs are met, you can move up the pyramid and you can go to things like community, you can go to relationships, love, things that make life more fulfilling. And then once those are satisfied, you can get into the really kind of existential stuff and like, what makes me me, right? What makes me Max and not Jeremy? And brands behave in much the same way, right? For whatever category you're in, there's an ante to get into the game, right? There are things that you need to offer as a brand in order to play in that category, right? If I'm a car and I don't have wheels and I don't have a chassis and I don't have a windshield, I no one is going to buy from me, right? If I'm able to trick someone into buying a car without a chassis, that's only going to last until they figure out it doesn't have a chassis and then they're going to defect, right? So there are boxes that you need to check, right? And these are features. These are things, you know, if you're selling supplements, right, you're selling skin care, whatever, there are things for that category that you need to offer once you've satisfied that you can then go on to the emotional benefits, which in this case are kind of things that you offer that are above and beyond what your competitors do. So let's say like options packages, right? The first time I got a car that had a Bluetooth in it, I was like, that was a really cool experience, right? It was like this new thing. I knew that the car would have it, but the first time I had to stop fucking around with the aux cord and it just connected, right? I was like, damn, this is awesome. Like, I can call hands free, I can listen to music. This is great, right? Made me feel a certain way. And the same token, like, it can be product features, it can be part of your customer service. It can be something like with toms, they built a whole brand around this idea of, you know, you buy a pair of TOMS shoes and they give a pair of TOMS shoes to underprivileged children, right? That is an emotional benefit. That is something that provides. It's an options package. It's something that you don't have to offer that makes people feel a certain way Right. And so we market those things, we message those things, but we don't build brands around them because they're inherently copyable.

Right.

I would be hard pressed to find a new car right now that didn't have Bluetooth as standard equipment, right? So if you build your brand around something that is an options package today, someone is going to make it standard equipment and then you're pretty much screwed. So.

Again, we market around those things, we message around them, it's great. But once you, once you've established that you have those and you've figured out what they are, then you can level up to the very top, which is what makes a Mercedes Benz a Mercedes Benz and not a Tesla, right? These self expressive benefits are based on kind of the core values and beliefs of that customer. And it says something about them that they choose to buy your product, that they choose to buy from your brand. You know something about Ryan as a person because he owns a Tesla, right? He does videos in it, he likes driving around, all that kind of stuff. You know something about him as a human being because he chose that and he didn't get a minivan, right? So the best brands in the world realize that they need to hit every level of this and they tell a very consistent story.

That addresses all of these things. And at the top, once you're able to kind of ascend to the top of that pyramid, that's where all the good stuff waits, right? That's where the high prices wait. That's where the customer loyalty, where they'll come back and buy from you again and again and again. The positive word of mouth, all that stuff is at the top of the pyramid. All right, So I told you earlier that Amazon's kind of devious. They plan a lot on disincentivizing you to brand. So I flipped this pyramid upside down, just mainly to be dramatic, but also so I realized where I was in my presentation. But let's think about the functional benefits that a consumer gets from going on Amazon, right? They're looking for keywords. Those are features. Amazon will give you those keywords all, all day, right? You can stuff them in your title, you can stuff them in your bullets, you can stuff them in your description. Great, take that. Compete with everyone on a feature level. Amazon will let you do that, right? The emotional part of shopping on Amazon, the thing that gives you confidence to actually make a purchase.

Ranking and reviews, right? You might rank very well, you might have a ton of reviews, but you don't own those, right? Amazon owns those. Amazon gives Those to the customers, and they feel confident. They, oh, this is a good purchase, right? But all that equity, all that kind of positive emotion doesn't go to you.

It goes to Amazon, right? And so if you're just doing this, if you're literally only driving traffic from Amazon, if you're literally only playing that game, right? You're basically commoditizing yourself. And then I did this to be dramatic, but here's three pictures of Jeff Bezos laughing because he is taking your money. And there's really no sustainability, right? So if we go back to that. That pyramid that we had before, right? There is, you know, there's the different levels, and if you're able to ascend to the top, right, you can find that story. You can find that thing that, what does it say about me as a human being that I buy your product instead of any of your competitors, right? And then you use that to tell a story, right? And the most important part is your brand story is told from your customer's perspective, not yours. This is the easiest hack, and it's something that I run into a lot in E commerce, but way more in tech, especially when there's kind of like this engineer founder that's put all his time in developing this product. They just want to talk about the product. They want to talk about everything that they did as a company, right? People don't really give a shit. People care about themselves. They care about what you can do for them, and they care about what you can do for the story they are trying to tell other people. So your brand story needs to be told from your customer's perspective, and it needs to address those core values and beliefs that we just talked about. So I like to use Lululemon as an example, right? This is Lululemon's brand manifesto. That's what they call it kind of lingo term. But you see these statements, right? Creativity is maximized when you're living in the moment. Sweat once a day to regenerate your skin. Friends are more important than money, right? Do you see the word we up here anywhere?

No.

Right?

Because these are shared beliefs between Lululemon as a. As a brand and the ideal customer that they're going after, right? And so it is really tempting when you're writing marketing copy, when you're like, especially when you're early days entrepreneurial founder, you're diving in there and you're like, oh, we are this, we are this, we are this, we are this, we are this, we are this. People don't care, right? Flip it around, tell it from the customer perspective, right? What are the shared beliefs that you have with that customer, right? That becomes the foundation of the story that you tell, right? And then the last piece is customer relationships are built on consistent experiences delivered over time. So once you have that manifesto, once you have that core set of statements, right? That core set of beliefs.

You need to deliver on that, on every single touch point, right? Anything from a customer service to email marketing, to an ad, to a listing page, to the product itself, to the packaging, to the insert. Any experience that a customer is going to have with your brand, right? Needs to consistently hammer on that experience, right? And that's the thing that big brands do really, really well. And that's the thing, the main takeaway I had from watching Catherine, right, Best self company has done a fantastic job, right? Their core promise, they're not selling a product, right? They're selling an ability to hit a goal. And everything that they do is designed to deliver on that promise from the customer perspective, right? From the design, from the web experience, from the other products that they offer, right? It's, it's a extremely consistent experience. I was opening the box last night and I was like, damn, this is really well designed, right? It gives you an emotional experience just to open that. So. And again, the Lululemon example, right? I like to use their, their manifesto because you've probably seen it literally printed on the bag when you leave the store, right? That's a good way of taking that stuff and kind of bringing it to life. So how do we take this stuff and apply it to our own business, to e commerce businesses, to if you have a seven figure brand or even if you are just starting out, right? Going from a business that isn't really a brand, that's generating cash flow to a true brand that you are able to command high prices, that you are able to consistently and predictably attract your best customers, That's a little bit of a challenge. But those same principles, that same process that I just rolled through, you can put into practice on your brand today if you want it, right? And I'll give you an example of this as we're going through, right? But the first step is going to talk to your customers right now. And it does not matter how you do that, right? It doesn't matter if you're responding to comments on social media, it doesn't matter if you're reaching out via email list, it doesn't matter if you're calling them, doesn't matter if you're getting on video Going to where they hang out in real life. I highly advise the latter set of that. I highly advise actually talking to people and if you can talk to them in person, that's even better, right? Hear the words that they use, pick up on the non verbals, all that kind of stuff is huge, hugely valuable. But the more you reduce people to a set of attributes, right, the harder it is to truly create a brand, to truly get creative that is going to move them to find the message, that's going to motivate them to make that initial purchase, to stick around, all that kind of stuff, right? And so I told you I work on some of Ryan's businesses and we had a brand, the first brand that I worked on him with, we acquired a skincare brand. And we started out our understanding of the customer was essentially that attribute list, right? We were working with a woman that was 30 to 50.

Starting to be concerned about aging, bought natural and organic products, but that's not a whole lot to go off of. And it was a bunch of dudes sitting around a table talking about it. So that's not going to be very helpful. We're not going to be able to market very effectively. And so we sent out a survey, talked to a couple hundred people off that recruited maybe 50 people for phone calls. And over the course of two weeks, every night we're on the phone talking to customers and we're not asking satisfaction, we're not, hey, how happy are you with the product? Hey, how, how likely are you are you to buy again, Right? We're asking them things like what are you trying to accomplish as a person? Like what are you obsessed with right now? Like what are you trying to do here? Like what is, what is your purpose in life, right? And like asking these squishier questions and then kind of working our way into like, okay, and how does your beauty routine play into that, right? And kind of leading them down a path where eventually we're talking about products, right? But we start out very open ended and try to get a sense of who they are as human beings. And so what we found from talking to these people is like our attribute list wasn't wrong, right? But there's so much more richness in that, right? These women were for the most part new to natural, right? They had been using, you know, kind of skincare products that had additives and they had just kind of found out that hey, these additives, like I don't know, maybe they cause cancer, maybe there's something wrong. I don't really Know, I just want to look into using natural beauty products, right? So they're kind of new on this journey and they weren't very sophisticated.

So that was the first thing. The second thing was they were also a little worried that those additives were the things that made the products work. They're like, okay, I know that I don't want to use these, I know that they're potentially bad, but I've been having good results. If I switch to natural, will it work? And all that kind of stuff. And then the third was, these are not people that had two hour beauty routines who were super going through and using 100 different products. They wanted a fairly simple routine that would allow them to wear as little makeup as possible.

And that they could go to the store with no makeup, feeling good. And so that presented a much richer picture of who we were serving. And in order to serve that person, we knew that we could tell stories, right? We could show results that other people had had using similar products. We could give them education on what ingredients were bad and which were good and what to watch out for and what to care about. And it just opened up a lot of marketing avenues, right? So the next step is to, once you talk to that customer, figure out what they care about and what they want. And then the sweet spot is kind of that Venn diagram on like what the customer wants and what you can credibly deliver on, right? If you can't promise someone that they're going to lose 50 pounds, don't promise that they're going to lose 50 pounds, right? But if you can create an experience where they're going to feel better about themselves, right? And you can kind of figure out a way to articulate that that's going to resonate with the customer, right? That's, that's kind of the sweet spot. And so for us on this brand.

The core promise was kind of natural. That actually works, right? It hit on their need for, we're looking for a natural product, right? But it also hit on their concern that maybe this won't work. Right? And so that came the grounding promise. And then we had a whole set of kind of core beliefs and everything that flowed out of that. Very similar to, you know, what I showed you for Lululemon, right? The core, core values and beliefs that were shared between us and our core customer. And that becomes the foundation for the brand experience. And then what we've been doing since then is taking that and applying it across every channel, right? So that includes, we stopped selling some products, right? We reformulated some so that it fit that natural that actually works. We're redoing the website. We've done updated ad campaigns and everything like that. So that has allowed us to focus in on a very specific customer, serve them in the way that they're looking to be served. Right. And because we've done that, we've been able to increase our prices by around 40% now. Have we lost customers along the way? Yes, but profitability overall is higher. And the reason is because a lot of the people that we're losing along the way are the ones that, you know, maybe they're deal seekers. They have a very functional relationship with the brand.

Right.

And those are the people that you're not going to keep around anyways. Right. They have a very low lifetime value compared to your ideal customer. And so we're really focused in on who that is. So, anyways, that is kind of my spiel. Thanks for your time and. Yeah.

Hey, so, Max, hang out with me for a second, because I just want to publicly brag on and edify Max for a second, because how many of you have had a difficulty making that switch? We talk about from product to people. How many of you have had a difficult time making that switch, at least mentally? Like, we talk about the other side of it, of what it looks like when you can charge higher prices, when you can really dial in who you are, who you are serving. But making that switch is often a big pivot for small entrepreneurs, and Max has been the person who really helped me with that. So thank you for that. I mean, the first time we sat down and just went through a branding exercise of really dialing in who the core customer was and how to target them? The shift that happens when you're in that bullseye is like, oh, right. Did any of you see the video of he and I sitting at a table going. Going through this exercise with my own personal brand? Whenever you have, like, you can see the bullseye, it's like, oh, that's my person now. I just go out and get more of those people, and all of a sudden, everything starts to flow much more effortlessly and easily. So Max is the guy I've been calling lately, and I'm like, hey, is this a bad idea or a good idea based on, like, where I want to go with. With my brand? So I just wanted to publicly edify Max for what he does. I know you work with only, like, two or three people at a time.

But where can people bug you?

And, well, immediately you can bug me.

Out in the hallway and then in.

The bathroom for selfies.

In the bathroom for selfies. Yep. And then, you know, find me Instagram Max Kerwick. You can hit me up. I'll have cards and email and all that kind of stuff.

Like Max is like, I work directly with Max and I'm very grateful for what he has helped us do with our brands and even my own personal brand. So I just wanted to publicly endorse you.

Thanks, man.

Cool. Give it up for Max Kerwick, everybody.

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 Furwick and my mission in life is to transform businesses into brands. If you have any feedback about the show, any guests you want to see, case studies covered, topics explored, or frankly, just any questions about branding in general, just shoot me an email@maxmaxrandbuilderstrategy.com Again, that's Max brandbuilderstrategy.com and I'd love to hear from you. One quick note, if you could subscribe to the podcast or even leave us a review on itunes.

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