How To Start A Product Business That Succeeds

Ah, welcome to Capitalism tv. It's my favorite thing, hanging out with people who like to make money and build business. So grab a seat, let's have some fun.

Today we're going to be talking about building online businesses, specifically E commerce businesses. But I want to clarify something first. When a lot of people talk about building a business, especially on the Internet, what they're really talking about is making money. And there's a difference between making money and building a business. Now here's some good news. You can start out looking for an opportunity, even if it's just doing it for the money, and ultimately make a pivot into turning that into a real business. My buddy Aubrey Marcus kind of did this. He has a hundred million dollar company called Onn & Onnit. Started as just a small little supplement company where I think his first product was selling hangover supplements. And then he created a nootropic that Joe Rogan loved and started talking about. And it made enough money for him to make the pivot into saying, okay, I'm gonna build this into a big lifestyle brand. And so he went from pursuing the money to building something real. Ultimately you will make the most money. And I wish someone had told me this, if you start out thinking, I'm going to build the business I want, I want to own this business, I want to hold this for a long time, I'm going to pay myself from this business. That's how you become a full time entrepreneur. That's how you build something great, that's how you ultimately get wealthy. And so that's going to be the focus of this episode. Most people, when they are thinking about what kind of a business that they're going to start or that they want to be involved in, will sit and think about what's a good product or what's the best idea. And they often try to force it. It's been my experience, and the experience of a lot of some of the most successful entrepreneurs that I know, that the best ideas come in a moment of inspiration when you see a problem that there has to be a solution to. So, so if you take ownership of a problem that someone else has and you create the solution to that problem, that's where a lot of really good ideas and businesses come from. One of my friends, Susie Batiz, founded the company Poo Pourri. You've probably seen their ads, they're pretty.

Funny. You would not believe the motherlode I just.

Dropped. But here's the story of Susie and how she came up with a solution that ultimately Became a multi hundred million dollar.

Business. I was at a dinner party and essential oils were always my hobby. And my brother in law said something about bathroom odor. And we started talking about, can it be trapped? And I felt alive. Like I felt like a zing. And I was like, oh my God. I saw it all. I was like, oils floats on water. And I just said, I can do that. And he very sarcastically like, oh, you think so? And I was like, yeah, I do. And it took me nine months. But the difference, Ryan, wasn't that I was creating so that I could get something. It's so this is this kind of movement. I was being pulled in by this curiosity if I could do something right. It was like a painter. Can I paint the sun? You know, it's like a Rembrandt, you know, he wanted to paint that skyline. Exactly. So that's where I was at. Can I do this? Never, ever, ever thought about being product, business marketing. Nothing. Just for the act of creating. It took me nine months, ironically. Right. And I create it and then it was like, it's so good. You have to share it with the world. Just like I would if I wanted to share the avocado toast with you this morning.

Right. And it was really.

Good. It's really good. But when you make something really great, you want to share. So that's the energy with which Poo Pourri.

Started. And that was the first.

Formulation.

Yeah. Really the original.

Formula. It's the original, yeah. And.

Still. And you started using it and.

It'S the base of everything. Yeah. Still, we still use that same formulation as our.

Base. Now. Susie created her own solution. She literally like made it herself by hand. And lots of entrepreneurs do that. But that doesn't need to be how it is. You can simply have the idea and go have somebody else make the product. That's what we teach. That's all we talk about. If you have an idea or you have a group of people who have a problem, you can go out to groups and manufacturers who then make that product. And if you do that well and you serve a very specific target market, you will do just fine. One of the best people that I personally know who does this is my friend Catherine Lavery. Catherine has built a few businesses, her most successful being the best self company. And this is a business that creates productivity tools and different opportunities for you to be more efficient. And they have a great journal that has become really, really popular. It's actually used by some of the sharks from Shark Tank and they've built a variety of different products that people really love. And her secret is knowing the customer so well that they can create products that serve them. They know exactly what that person wants and they give them a beautiful customer experience. Catherine gave a keynote at one of our events in which she talked about how they developed this customer experience. And I want you to watch.

This. So how many people here, how many people here have ever bought a product from Apple?

Okay, most of you. How many people here still have their boxes that they bought?

You know that feeling when you open a new Apple box and it just feels so good? You have that whole unboxing experience. Like, I live in New York, which means I essentially pay rent to store these things, but I just can't throw them away. And that's when I have that unboxing experience. Everyone knows the Apple experience. And so whenever we started working on Best Self, that was something that I put a lot of time and attention into. Not like when we were successful and we had a store, but back when we did the Kickstarter or what about Harry's? So.

Apple, you know, they sell cool products, but Harry's sell razors. I mean, like tonight if you met someone and they were like, I work for a razor company, you'd be like, okay. But they would say, I work for Harry's. You'd be like, you just like want to ask them so many questions. You'd be like, how do I also work for Harry's? Because that is the difference between building a brand. It's not just about customers and the experience, but people respect it more. And hiring is also going to be easier. So it doesn't have to be just a cool product. It's just creating that cool experience. So I want to talk now about what it is to create an experience in three steps. So with everything from Apple to Harry's to the muffin thing, there's a visceral start. There's a feeling that you get when you see a product or a service or whatever it is something. It's either the look, the taste, the smell, the color, the texture, whatever it is. It's like that first 10 second feeling you have when you see something that you can't really describe but you know you like it.

And then there's the behavioral. This is the part where is the product easy to use? Do you know exactly what you're doing? Are you confused by it? Do you have questions? Or is everything seamless? And then the end is the reflective. This is kind of more the woo woo stuff, but this is the difference maker between an experience and just selling a product or a service. So this is, does it speak to your self image? Does it help you express yourself more? Do you have positive memories from the experience? This is the stuff that when you think of creating a product and delivering a product, you want to think of the stuff that they're going to pick up right away. So what's the first like two minutes of them opening that product or service look like? And then how do they think about it after? What do they tell their friends? If you were to ask one of your customers, what do you think of my brand or what do you think of our product, what do you want them to say? And it's helpful to think of that first and then build the experience experience from.

That. Because they make such great products that serve a very specific group of people. They're not dependent upon any one platform or system sending them all their money. So they don't just sell on Amazon.com they don't just sell on Kickstarter. They don't just sell on their own website. They do all three of those and they do really well at all three. One of the mistakes that I see a lot of entrepreneurs make is in a pursuit of money, they get married to a platform. So they only know how to make money on Amazon or they only know how to make money on Kickstarter. And when that's the pursuit, you get short term results but you don't build long term wealth. The really cool thing behind all three of these examples, Onnit Poo Pourri and the best self company is that they've built brands that serve a specific person. They own a business that creates value that serves other people. And because of that, people show up and they show up on Amazon and they show up on Kickstarter and they show up by buying on Facebook ads and they show up on buying on your own website. They'll show up in retail stores if they really want your product. The secret is not in the platform. The secret is not in the hack or the strategy or the manipulation or the sales process. The hack is in owning a business that creates value for a very specific person. I know I sound like a broken record. Build an audience, building the audience. I don't know how to build an audience. Audience is the distribution play. Audience, audience, audience. That's it. But it's what works. It's the strategy that works to build a real business that you're proud of that lasts for a long time and ultimately makes you a lot of money. One of the questions that Comes up when people think about this is, okay, well, I don't want to fail, so how do I sell my products? How do I, and how do I sell it in a way that doesn't force me to be dependent on a specific platform like Amazon.com or wherever you take sales? And some of the best advice that I've seen on this comes from Joel Marion. Joel Marion is an influencer. Actually, he's like one of the real influencers who built a $100 million company first and then he went out and built an audience. And Joel has done some really cool things in business, including building the $100 million company BioTrust. And Joel talks about the secret behind his success is in the marketing strategy that allows him to outspend everybody else. So this doesn' throwing money down the drain. It means having so much money to invest in marketing that they can communicate why the customer wants their product so they get the right people that they can serve for a very long period of time. Here's a clip of how Joel walks through his marketing strategy that allows him to beat everybody who's trying to compete with.

Him. If you don't know your numbers right now, you know your homework assignment, go home and start figuring out how you can know your numbers. Because you're never going to be able to scale a business otherwise. What is my customer profit at 30, 60, 90, 180 days? So you can confidently spend more to acquire a customer with certainty. The more certain you are, the more comfortable you're going to be with spending money and going negative up front. Okay.

Number three, do the work and get comfortable with complex back end reporting. Gotta get comfortable. It doesn't mean that you have to do it, but you have to build a team and put the pieces in place and they can do it. Okay. I don't. I'm not the one actually running queries on the database and generating reports. I hired somebody to do that, but I had to hire the right guy, tell him exactly what I wanted to be specific to get the numbers that I wanted to get. Okay. And number four, be willing to go negative up front to outbid your competition and get the lion's share of the available traffic in your industry.

Going negative up front is something that most people are not willing to do because they're fearful that they'll never make up the amount that they're investing. If I'm spending $50 to acquire a customer and I'm only collecting $35 up front, most people are not comfortable with that because they feel like I Don't know if I want to make that $15 up, and if I do that a thousand times, 2,000 times, 10,000 times in a month now it's 10,000 times 15. And you're losing a lot of money. It looks like you're losing a lot of money in a single month. But if you know that in 60 days, you're going to make that up, and then everything after day 60 is all profit from that point forward, and you can get 10 times the customers and you know with certainty, then you can truly start to think about playing this game of.

Scaling. Okay, I've said this several times now, but the way that you get wealthy is through ownership first, taking ownership for yourself and taking ownership in a business. If you have ownership, that's how you get wealthy. I also believe that's how you get happy. If you own the problems that you have, if you take complete ownership for the results you get in your life and you don't blame other people and you don't blame your past and you don't blame your parents, you take ownership for this is my life, and I'm going to create something awesome out of this. That's when you're free. That's when you get to be happy. That's when you can really create something amazing. We've talked about Suze Batiz and Poo Pourri in this episode already, but Susie did more than just start a company. Susie took ownership for all of her failures and all the pain that she had, and she used that as leverage. She used that as data to be able to create something different. And I want you to hear the real story behind how she started this business and became.

Successful. I grew up in a really. I checked all the dysfunctional boxes. If any of you guys know, you know, I was molested as a child. My dad was a bipolar alcoholic. My mom was addicted to pain pills. I was molested by my stepfather. I was married at 19, divorced by 20, tried to kill myself when I was 21, and abusive marriage at 23. So I'm serious. Like, all those dysfunctional boxes. And what I realized through all of that is that I stopped feeling because of all that, because of what society tells me, because it's cultural, you know, suck up, take it, just push forward, go ahead, like. And I believed all of that again. After my second bankruptcy, I went to a therapist, and she said, where do you feel that in your body? I literally said, what body? What are you talking about? Where do I feel that in my body? And she started teaching me about that there's feelings down in me that I had literally cut off because of trauma society. Because I knew that if I would just push through and make it and somehow do all of that, that I would end up being somebody and then I was going to feel good. That was the plan, right? The subconscious part plan. If I just push through, then once I got rich, then I was going to feel good. And this therapist started working for me. I started noticing and the more I started feeling, I'm like, there's my wonderland in here. And not only is there a wonderland, there is a GPS system that I have inside of me that I had no idea existed. This is alive and it's happening and, you know, I need to activate it and use it. And I don't need all those outside people to tell me what to do. Like, I literally have my body as an ally that can help me go through life. And I had literally cut off my body and just said, you know what, mind? Let's go. We're going to tackle the world and we're going to do this thing. And then when I started realizing that my body that I could feel and that emotions were good, the more I felt sad or angry at that same level was the amount of good feelings I could have. I had no idea that cutting off all of those negative emotions we call it, was keeping my pipe constipated right to where I wasn't able to feel that amount of love and joy and happiness. So my goal has been feel.

More. I know it can be really easy to look at people who are really successful and say, must be nice or they had some sort of an advantage or what was their strategy? Let me reverse engineer that. The reality is, once you just take total ownership for every result that you get, what your body looks like, what your income is, that's when you're powerful, that's when you're free. That's when you get to create the rules. That's when you get to live happily ever after because you get to set the course of the game. It's when you get to play the game and you're not playing by someone else's rules or the rules that you made up in the past. That's really when you're free. You take ownership for your own results. And ownership in a business, then you create something, you create a business, you create the life you want. And usually you get all of that by serving other people. That's capitalism in its purest form. If you're ready to start your journey, head over to capitalism.com start we have some free resources to serve creators who want ownership. And I hope that's you, because we'd be happy to serve you. Thanks for watching. If you're not subscribed, do me a favor and click that button. Ring the bell and I'll see you on the next episode.