The Off-Amazon Funnel Finally Worked

Oh, well, hello there. Good morning you good looking person who hangs out on Facebook and YouTube watching Ryan Daniel Moran. It is Thursday, August 6, 2020 and it is a great day. It's a marvelous day. Did you know that all data suggests that we're on the other side of the curve when it comes to COVID 19 this the states with the highest concentration of cases are on the downslide. There is new innovations happening in the marketplace to ensure that we are kept safe. People are going back to school, the death rates are down, the economy is up, the stock market is up. New innovations and new money is pouring into new technologies. What a world. Aren't human beings amazing? Don't we do just some absolutely amazing things? It's a great day. It is a wonderful day. If you're watching live, please say hello in the comments. Hello, Junid. Hello, Joanne. Good morning, Rhino. Good to see you. Good morning, Jay Beckham. Hello, Adolphe. Is it Adolphe or Adolf? Adolf. Adolf or I'm gonna call you Adolphe just because that's a badass name. Thank you for all of you who left comments before we went live. Good morning, Matt Ohms. We'll talk about him and why he's awesome here in a second. Good morning, Greg Johnson. Hello, Randy Roon. Hello, Susan Anderson. My favorite person on the planet. The smartest, best looking.

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Oliver. He says hello and he's purring. Can you hear him? I'm holding a cat up to a camera so that you can hear him purr. I'm pretty sure that borderline's on illegal in Texas. Anywho, let's kick this things off. Good morning ladies and gentlemen. Welcome to capitalism and coffee. My name is Ryan Daniel Moran. We got a lot to talk about today. We're going to talk about the funnel that is finally working and how that applies to physical products, brands and businesses in general. Especially if you are starting something new or you are selling successfully on Amazon. Now before we kick things off, we do a little bit of an homage every Tuesday and Thursday when we're live on here as a salute to someone who has inspired me greatly. His name is Scott Adams. If you don't follow him, you should. And what we do here is we do something called the simultaneous sip. He does it at the same time we do. And the more people who do the simultaneous sip, the better the world gets. So all you need is a cup or a mug or a glass or chalice, a stallion, a tankard of thermos, a flask, a vessel of any kind. You fill it with your favorite liquid. Today I've got mud water with four somatic mushrooms and MCT oil. That's what I got. And then you join me for the unparalleled pleasure that we call the simultaneous sip. Go.

I can feel the chaga mushrooms and turmeric and MCT oil flowing through my veins. I'm doing a little bit of a low carb experiment. I do these about once a year or so as kind of a metabolic reset when I haven't been on my game, if you will. And so I've been kind of off kilter a little bit with my diet and I can. I'm really good at resetting them when I do a little bit of a.

Low carb period for a while. So I'm in that right now. It's good to see you all before we dive into when I want to chat with you today. Today's capitalism and coffee is sponsored by 12 months to 1 million on Audible. You heard it right, folks. Go over to Amazon.com right now and you search 12 months 1 million. And the audio version of 12 months to 1 million is available for pre order and it'll show up in your audible account in, oh, 600 days. That means five days. It doesn't mean five days, but I felt like saying it. So, audio version, if you would like to hear me read you the book as my sweet podcast voice LS you into a deep state of understanding and financial success, then just go over to audible.com right now, type in my name and buy it on Audible right now. Do it now.

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There was like some nlp in that. Did you notice that? Just kind of flowed out of me. The neuro linguistic program. Hey, by the way, let's just do this. If you actually go over. Sorry, we're in NLP mode. When you choose now to go to Amazon and to purchase 12 months to 1 million the audio version, I would like to say thank you. So would you please.

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Thank you, Adolphe, for ordering the book. I really appreciate it. Okay, so, man, I got the best news. I just got the best news this week. And the news was that a funnel that we have been working on for several months is finally starting to hit pay dirt in one of my brands. And I want to explain to you why this matters and why this is important. Because for those of you who have brands, this I think will simplify the process quite a bit. Thank you, Jay, for buying the book. Thank you, Brad, for getting the book. I appreciate it. Hello, Kara. You make my morning. Good to see you.

So in on Tuesday. If you didn't watch Tuesday's Live, it was really, really good. I walked you through our plan of how we'll take my next brand and build it into a multimillion dollar business. And I also go on a really fire political rant for 30 minutes. That was awesome. But in the first 30 minutes, we talked all about how I have these kind of three stages for my business launch, which are launching on Amazon and then moving over to a funnel and then tapping into influencers and other traditional forms of advertising to scale the foundation from there. And for a lot of you, there were questions that came in on that second stage about how do you build the funnel that is successful and profitable. Now, it is extremely rare that I see Amazon sellers make a successful pivot from selling on Amazon to having a profitable funnel. It is extremely rare. And the reason why it is rare is because the two mindsets between Amazon and Shopify or a funnel or cold advertising or click funnels or Whatever you're using, they're two very different mentalities and they do not work on each other's platforms. So with Amazon, if you come from the funnel world, you're super frustrated because on Amazon, there's no upsells, you can't follow up with your customers, and people are like, wtf are all these people doing on Amazon? And the Amazon sellers know you have to break even for a while until you get a certain amount of review velocity and eventually you start to rank for keywords, and then you get all this organic traffic and you get to live off the organic traffic. Amazon sellers can't understand the paid traffic side because they're sitting here going, what are like, the costs to acquire customers are astronomical. Like, I can't just like, sell more of what I just sold them in an upsell flow. What, like, what the heck do I do in order to make this work? And so the two mentalities are very, very different. And it's rare that people succeed at both. But there is a way, if you understand the mentality of how each of those two systems work. Now, on the cold traffic and funnel side, what you have to do is be able to acquire a customer at about break even within about 60 to 90 days of having the customer by selling them additional things that they bought after their initial purchase. Most people do that through an upsell flow. Now, there's another way to do this, which I have been preaching to y' all for years and nobody listens. No, but none of you actually do it. And it is around audience building and audience partnerships. So let me walk you through the model that we're using so that you can see the overall strategy and then you can see how we applied it and actually used it to hit paydirt this week. And it looks like this. We've got a series of products that sell on Amazon and do just fine on Amazon. Some sell better than others. But what's important in a funnel is that you don't have multiple products selling that you have one product that is the focus. If you can put all of your focus around your ad budget, around your. Your advertisements, around the sales page, around one product, one pain point, or one solution, then in doing so, you're able to get higher conversions and then keep that customer for a long time. But when you have a slew of products, a lot of people just choose one and then front end it. That's not what we did. What we did is we took our products and we packaged them into one solution. You kind of think of this Like Proactive. Proactive Solutions is actually four products in one kit. But if they were to sell each individual product, they wouldn't be able to have the margin that they have on selling it as a complete kit. Now, when you buy Proactive, you're buying one product, but it's four individual steps in the system and that's in acne. Right. You might consider something like a bulletproof coffee. Something similar to this. Bulletproof coffee is the beans, it is the butter, it is the MCT oil, in some cases it's the bulletproof blender, and then it's the collagen bar and it's all of these. But when you buy bulletproof coffee, you're buying a packet of pre made bulletproof or, or you're buying the beans combined with the MCT oil combined with the butter. You're buying a package, but you're really buying one product. You with me? So what's important is that when you are going from one sales platform to another sales platform, that you have the margin to be able to run traffic or ads to that one product. But that one product can be a kit or a series of products. For example, there was a question that was put in the comments about how would you do this in yoga? The way that you would do this in yoga is not by selling the yoga blocks and then upselling the mat and everything else. It would be by front ending the kit, the yoga starters kit. And now you are very targeted to people who are beginning their journey in yoga because they need all three or four of those products. And so if you sell the, the mat on Amazon for $30 and the blocks for $20 and the towels for $10, that's $60. And then if you bring that into a package, that is 49.99. And that is the first transaction in your funnel. You're running all of your traffic to acquire the $50 buyer, not the $30 yoga mat. Buyer, Buy buyer. So this is the first part of the magic is that the funnel is around one product, but it has to be one product that has enough margin for us to be able to run traffic. Now.

Do what I look at, what I do, not what I say. You see me documenting the business that we're launching called Switch Switches. Nootropics company.

Not quite ready for launch yet. Should be by the end of the month, but switch work. We're trying to come out of the gate with three products right away. Why do I want to do that? I want to do that because each individual product is going to be $50 or you can buy the whole thing for either 99 or 129. I haven't decided yet. What I really want is not people to buy $59 products, they're $49 products. I want people to buy $99 a month. That's what I want. I want thousands of people paying me $99 a month and getting the whole system, the whole kit, all three products. Now when that is the case, now I have the margin, I have the very targeted focus to go out and get a lot of customers and put them into this pipeline where I can, I can scale this business. Whereas if I was just on Amazon selling nootropics, then I would be looking at, okay, well these people charge this much and these people charge this much. So I'm going to try and price myself in the middle somewhere. And Now I'm selling 28 nootropics and I'm trying to grease the wheels so that I'm, I have Amazon rewarding me by giving me higher rankings and I'm running pay per click ads and I'm trying to break even. And now all my attention is getting reviews and I'm playing the Amazon game. Now even if I win that a year out, if I try and take that same strategy and apply it to a funnel, the only thing I know how to do is what, sell $28 nootropics by running a Facebook ad. That isn't what I want. I want $99 a month customers. And in order to do that, you have to be able to take what you've got and create it into more of a system where you have the margin to be able to acquire customers, run ads to acquire those customers. And then you can talk about upsell flows and all the things that you can do in order to get the numbers where they need to be. But the real secret happens way before you start the funnel. It's in thinking about the business like a brand rather than another sales system that you were bolting on to what you got. When an entrepreneur is doing well on Amazon and they're like, now I want to start a Shopify store in order to diversify my sales, I know they're going to lose because, because it's, it is not a defensive play to build a funnel, it's an offensive play. But most people treat it like I'm going to diversify and hedge my bets. And this just is just not how it works. It's just as much of a business having a funnel as it is taking sales on Amazon, the, the thing that makes it easier is when you have an integrated mission, meaning you're growing the business, you're scaling the brand rather than trying to manipulate different sales systems. And so this week one of our, one of, one of my funnels in one of our brands finally hit pay dirt. Oh my goodness, what a relief. I have a business that I purchased a few years ago that has been, has just struggled and it's been a real ouch financially. It's been, it's been my, my struggle bus and you know, I, the only reason I ever talk about it is so that we can kind of humanize the experience a bit because this one financially, it hurt a lot. But I don't really have anything to share about the business that would be helpful. And at this point until now, because our funnel has really started to hit pay dirt to the point where I can see us accomplishing 1 to 2000 people at the end of this year paying us 60 to $100 a month. And that completely changes the business. You know, that adds, if it's 2,000 people at $100, that adds two and a half million dollars in run rate very, very profitably and completely changes the valuation of the business. Especially since monthly orders have higher valuations than just front end sales. If you've got people on auto ship, that raises the valuation of the company more than profit does. So that's really exciting and a huge relief. Now that's the overall strategy. Now I'm going to tell you the, the sweet sauce behind it all first.

Hello Wes. Hello Desmond. Hello Andrew. Good morning Brian. Good morning Noel. I'm glad you listened. Good morning Drew. Good morning Tiffany. Hello Matt. Brad, thank you for purchasing the audiobook on Amazon. I mean we all just all owe Brad some hashtags. Thank you. Thank you Brad. You're my favorite person of the minute. You as of you are my Favorite Person at 9:21am in Austin, Texas Central time. You're my favorite person at 9:21. At 9:22, who knows? I don't know where you're gonna stand at 9:22, Brad, but as of 9:21 you're my favorite person. I'm a favorite person of the minute. No one can compete with Brad at 9:21. Don't know what happens in 19 seconds. But for now you're my favorite.

Hello Bram. Good to see you. Hello Shella. Hello Andrew Oliver. Hello John Wesley. What a great name. Good morning Tom Sullivan. Hello Michael. Hello Chantal. Good to see you.

I'm really enjoying this beverage. This Morning.

Nate. You have to show me your face first. I've never seen your face. You're hiding behind that really creepy photo of you on Facebook. Super creepy. Absolutely creepy.

Hello, Ali. All right, good. I'm glad you guys are enjoying this. So let's keep going. So that's the strategy behind what I do now. The sweet sauce on the other side of this is something that I've been talking to over and over and over again about audience building and audience partnerships. And we created a partnership with an influencer about a year ago that.

They'Re compensated on equity. So it's an equity partnership. We don't pay them out of pocket. This person is compensated by having ownership in the company. And what this person has is a very responsive, not huge, less than 100,000 followers. Because followers doesn't really matter. You can gain followers. Engagement is what matters. There's a very active but small audience that this person controls. And when they talk about our products, they sell more or we sell more. So the.

What has happened is as this person talks about us, our sales get a nice spike. Well, what we have been trying to do in the past was use this person's audience to boost our Amazon sales. And it really did help, but it only helped in the short term. It didn't really help in the long term. We never picked up that. That momentum, that, like, liftoff, where there were a lot of repeat customers. It was more like this person would talk about us, we'd get a surge, but we were never able to sustain that momentum until now.

What has happened now is that when this influencer talks about us, we send them over to the funnel, the kit, the package, the complete solution. And the complete solution is the one place that we want people to order. So one place that puts people on a monthly commitment. It gives them a discount, and it gives them our best products, so they're having the best experience that they could possibly have within our. Within our company. So as a company, we could put all of our focus into optimizing the customer experience and the results that our customers get from that primary place that we want them to experience us. And so if we put all of our attention from the influencer side, from the ad side, and from our product and packaging perspective, then what's going to happen? Well, that's going to grow. We're going to get a lot of positive feedback. We're going to get referrals, and we've just started talking about it through this other person's audience. You know what that means? It means the Traffic is free.

Now. It's not free because this person is an owner in the company, but in the when it comes to cash flow, this is free traffic. It's free traffic. We're not paying for any ads. This person is talking about it organically to their audience. And what's happening? We're getting hundreds of people for free, not paying an affiliate commission.

Hundreds of people are going over and ordering our monthly auto ship product that is going to add millions of dollars in value to the company.

So run these not. Here's, here's the numbers for things. This is something I need to talk about much more often. Sue, clip this next rant. You have to think about your company as creating something that is going to be sold one day and calculate your decisions on the value that is produced, not just the short term cash flow. When you run the numbers on putting people into Auto ship, for example, if you have a thousand people paying you $100 a month, that is boosting the cash flows. Yes, but you're also boosting the valuation of the company because people on Auto Ship are worth more in a valuation perspective than just simply short term sales. So sometimes entrepreneurs are resistant to punting the short term cash flow or even punting the equity relationships that can be created because they're trying to control the entire pie. What they need to be thinking about is how do I make the biggest pie possible? And that means creating the most valuable asset possible. So I build relationships with influencers and give them a piece of equity in the brands that I start or acquire. And some entrepreneurs are really resistant to this idea of giving up equity, giving up a piece of their baby. Well, think about this for a second. If you can create a relationship with an influencer that you don't have to pay and that doesn't take an affiliate commission, but they have ownership in the company and as a result of partnering with their audience, you're able to take your auto ship numbers from zero to a thousand people per month. A million dollar business that creates about $5 million in value for when you sell the company. And if that person owns 20%, yes, you just gave them a million dollars and you have $4 million that you didn't have before. And you could have never built on your own. And even if you could, would have taken you three years. People so underestimate the value of partnerships because they're looking at things in the short term rather than looking at the total value potential, the asset valuation of what it is that they're creating. We're doing this new initiative@Capitalism.com called the Capitalism Incubator. Some of you are. Some are already in there. Matt. Matt Ohms is my favorite person of 9:28am Central Time. Good work, Matt. We opened up 25 spots. Five of them are already gone and we're closing. We were going to close at the end of August, but I think we're going to end up closing them earlier because there's 60 applications for 25 spots and I've barely talked about it. But I'm teaching this model in the incubator, which is creating partnerships with people so that you are not funding the whole business yourself. You go out and you create a partnership with somebody who is providing, putting up the money. You don't have to go build the audience yourself. You go partner with somebody who has the audience and by doing so, you now have multiple people who are contributing to the valuation of the business without you having to carry this entire thing on your back. If you want to be a part of that, go over to capitalism.com Inc. And you can be on the waiting list for when that opens up. Or you can apply for an early spot. Hey Emilio, good to see you. Dude, where do you even live in Austin anymore? Are you hiding for quarantine?

Don asks, would you create these equity partnerships when your business is starting in the earlier phase or when it's established and already running pretty strong? Great question. So Don, we talked about this a bit on Tuesday, but it makes, it makes no sense to me why entrepreneurs are so willing to give up 10 to 15% of their company when they sell it by going to a broker or an M and a firm at their highest valuation. But they're not willing to give up 10 to 15% at the beginning of the business when they're at their lowest valuation. The sweet spot for creating partnerships is when you are either about to or just after launch. So you have some sales or some demand and you have a prototype or pre sales. So right at those early stages when things are starting to pop, that's really the magic time to create these partnerships because you've shown that you are not raising money on an idea. You've got a prototype and you've got some momentum. You've at least got people following you. You've at least got a partnership with an influencer, right? So still early stages and your valuation is low, but you've got some momentum. So people aren't just buying an id, buying it on an idea. So that's really the sweet spot of the time to do this. And it also gives you the most opportunity to choose what it is that you need because you know that you've got the product, you might have the influencer, the audience, and now you know you need the money and so you can go raise the money based on the momentum that you've got with the assets that you have.

Amanda says, does the audience and the influencer have to be the same audience who are building your brand to. I don't quite follow, but it should it. What I think you're asking is, does it need to be the same type of audience to complement the two? And the answer is the person that the, that the influencer speaks to needs to be the same person that your product would be a fit for. Otherwise you're trying to do a bait, bait and switch and that's going to be difficult to do.

Tom Sullivan asked about the structure, the structure of partnerships. That would be a conversation for another day. I also have some content that I put out there about it. So that would be a long, a long, a conversation one for another day.

So what's happening for us is we are now getting profitable sales through our free traffic, that is a few hundred people, it's only been a few days. So the funnel is really starting to pop and build some momentum. We'll continue to stoke that fire until it's a solid thousand people over the next probably two months. And then we'll, we'll then bring on other relationships that we might pay for, optimize the funnel and run ads. Where we go from, you know, a thousand of those people to 2500 of those people to 3000 of those people and 3000 people at $100 a month. It's a multimillion dollar business with a very high valuation because they're all on auto ship. Plus you have the spillover of those buyers coming back and buying other things, buying on Amazon and the snowball starts to build. Momentum builds and builds and builds. This is why having that kickoff of partnering with an influencer or having your own audience is so important and gives you such an unfair advantage. Whereas most people are going out, putting it on Amazon, running pay per click traffic and starting to build the snowball. That's great, that works. But it's faster to create a partnership with an audience and then to go from there.

Isn't this fun? Isn't it fun?

We are probably going to wrap here. That's all, that's really all I got for you today. A couple house cleaning things. If and when you want to start this journey, we have two places where you can start. Number one, capitalism.com start is where all our free resources are. Go there, enter your email address and you'll get access to our best free resources. Just do it. Number two, if you're ready to get off the sidelines and actually build one of these businesses, we have this thing called the Capitalism Incubator. Our next round closes at the end of August. We're taking 25 people. You'll be working closely with my team. That's at capitalism.com inc.

Question from Randy. Are influencers suspicious that you're looking? No, they are not because I spend a tremendous amount of time building relationships. Hey Sean. See you tonight.

And there was one more. Oh, and this coffee hangout has been brought to you by. 12 months to 1 million. Now available on Audible. Go over to Amazon.com and search 12 months to 1 million. And as you choose to select the add to cart option, it'll be pre ordered and in your audible account this August 11th exclusively from Ryan Daniel Moran. Thank you to all of you who have supported the book. It has been, you know, it's, it's interesting writing a book, like writing a book the way I wrote it. You know, I took 18 months to write the best piece of content in my life to make six bucks a sale just for the joy and pleasure of it. And it has been a joy watching, I mean, as of right now, 113 reviews and 108 of them are five stars. That's amazing. How fun is that? And to see so many people reading it and having the light bulb come on and see that it's going to start them on their journey is such a rewarding thing. So thank you to all of you who have supported the book, who have bought the book, who have talked about the book, who have shared the book, who are buying the audio version now. I just, I just so appreciate it. Thank you, Michael, for reading it cover to cover. I hope you like the audio version as well.

I don't know who this is, but person saying, asking about the equity piece of working with influencers. Yeah, like equity is the most expensive way to compensate somebody in the long term, but the cheapest in the short term. And so when entrepreneurs are, when until entrepreneurs are at 5 million, they can't afford the talent that they need to get to 5 million. Equity is another way to compensate people. There's a great video on YouTube if you, if you look up my channel, there's a video called is equity that Important? Go watch it. It's, it'll be a really, really helpful nine minutes of your life.

Chantal yes. Is available on audio.

All right, friends, thank you for hanging out with me on Capitalism and Coffee. If you're watching on YouTube, please ensure that you're subscribed. We go live every Tuesday and Thursday to talk about business and investing and personal growth. And I would love to hang out with you on the next one. So thank you all for being here. And I will see some of you. Oh, some of you this Sunday when we go through how one of our members gets 10,000 reviews on his Amazon products. It's going to be a really good one. So that will be here on the channel inside the 1% this Sunday. So I'll see some of you then. I'll talk to you guys soon. Take care.

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