The Secrets And The Mindset Of The $100m+ Man w/ Joel Marion #BrandBuilderPodcast

Everybody wants a bigger business and they want it as fast as possible. And while there is no secret sauce, I'm going to teach you a little bit about what I've done and how I've been able to scale multiple businesses very, very quickly.

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 product 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 capitalists. Before we jump into today's episode, I actually want to brag on myself for a second. I've got a podcast episode that I think got overlooked. I think is one of the best ones I ever did. For those of you who sell on Amazon or those of you who run e commerce businesses and it's called Only Invest in Multipliers, I would highly encourage you to go look that up if you haven't heard it before. In it I argue why you should not fund your own inventory. Because if you're funding your own inventory, you are tying up all of your money into a place that you could be otherwise using for advertising and people and growth. And I explained how to use other people's money in that episode. What I wish I had back then was access to more resources for capital. Back then when I recorded that episode, there were only a few sources that lended to Internet business owners. But one of my backroom members just launched a business that exists only to fund inventory orders for physical products brands and it's called Sellers Funding. This is something that I wanted to do for a long time. In fact, when I used to cast my vision for capitalism.com it included a lending source for physical product owners. But one of my backroom members beat me to the punch and he actually did it better than I could have ever done. So that business is called Sellers Funding and they loan to e commerce sellers to allow them to free up the rest of their capital to invest in things like advertising so you can actually grow your business. I would highly encourage you to listen to that episode called Only Invest in Multipliers and then to look at other funding sources, especially sellers Funding, because they're in my network and I know what they're up to and they're doing cool things in the world. You can check them out@capitalism.com funding. And I think this is a game changer for your growth as a business.

Hey, capitalists, buckle in. This is c money from capitalism.com and today we've got a really great talk from Joel Marion at the Capitalism conference. If you don't know, Joel is the co founder of BioTrust Nutrition, a hundred million dollar plus supplement company. But he really caught Ryan's eye when his own personal brand just seemed to blow up overnight. So to listen to more Joel, check out his earlier podcast on the capitalism.com podcast network. It's called 100 million in sales, 1.2 million followers and 1.7 million emails all in 12 months with Joel Marion. But really, whether you're building a personal brand or a supplement brand or any kind of physical product business or info product business, you're going to get a lot out of this talk. Joel talks about what it really takes to stand out from the competition and how to develop the right mindset around advertising, marketing and brand building today in 2019. For more information about future upcoming events, visit capitalism.com events and all right, onto the show. What's up everybody? How you doing today? We'll get right into my presentation here. Yeah. My name is Joel. I am. It's an honor to be here. And the title of my presentation is how to scale your business and your message 10 times bigger, 10 times faster. How many people would say that that's something you're interested doing? Okay. 10 times bigger, 10 times faster. Okay. Everybody wants a bigger business and they want it as fast as possible. And while there is no secret sauce, I'm gonna teach you a little bit about what I've done and how I've been able to scale multiple businesses very, very quickly so that you can take some of these strategies and you can go back and implement them in your business and maybe mirror some of the success that I've had. Okay. By the guy who actually did it. So I'm not just up here talking.

This is something that I've actually practiced and put into place. I've actually just recently started speaking and more often anyway. I've been speaking for a long time, but more often and sharing some of these things because I've been behind the scenes doing this stuff for just over a decade now. So you can be comfortable that you're learning from somebody who is not just up here talking to talk. But I have walked the walk far before I ever stepped on stage to talk to talk about it. I just want to take a moment and thank Ryan for having me. I'M also I feel very fortunate to be sandwiched in between two of my best friends.

Craig Valentine and Bedros, who will be speaking after me. It's a pleasure to be here with both of those guys. And then there's of course a great lineup of amazing speakers here. But I just want to express my gratitude to Ryan and also just give a shout out to Craig, who just spoke, did an amazing job and Bedros will be coming after me. Two of my longtime best friends for about 10 years now. So I'm very excited to be here and look forward to hearing Bedros in a minute. The proof is in the results and I just share some of this stuff here. None of this is to brag, but just to so that you understand who you're, who you are hearing from today and maybe get you a little comfortable that maybe I know a little bit about what I'm talking about.

So I was the guy who did the very first My very first ebook Launch was in 2019 and my very first ebook launch was also the biggest ebook launch in fitness ebook history at the time. My first launch and the biggest one of all time. Okay, at the time we did $461,000 in three days, which was a milestone at the time. That was back in 2009. It was a milestone at the time for that particular industry.

We went on to do the first million dollar launch of fitness ebook history a little over a year later, about 18 months later, and then repeated that four, four times. One of the individuals that I did one of those launches with, I partnered with a friend of mine, Josh Bazzoni and we did $1.2 million in about six days, less than a week. And then ultimately he became the individual that I co founded BioTrust Nutrition with. I built a $10 million a year while I was doing this ebook stuff. I built a 10 million dollar a year lifestyle ebook email marketing business with one part time employee. As you can imagine, if you're bringing in $10 million a year and you're selling people digital downloads with no hard costs and you have one part time employee, the margins are pretty sweet. And then.

I got approached by Josh Bazzoni and he pulled me into this whole supplement thing and I very quickly this whole thing about lifestyle went away really quick. So we went from 0 to $100 million with BioTrust in our first full calendar year. I think it was about 16 months in that we hit 100 million. And then every calendar year after that since then we've been over 100 million. We've been as high as 138 million in one year. We did that again. 2012, we launched. Late 2012, we launched, and by the end of 2013, we had surpassed a million 100 million in sales. Recently, just about a year and a half ago, I got back into the ebook business. I had a remnant email list of about 20,000 subscribers. We very loosely kept in contact with them While I was getting BioTrust off the ground for about five and a half years, I only sent maybe one or two emails a month to them. The list was a couple hundred thousand people.

When BioTrust started, it dwindled all the way down to about 20,000 active people who were actively engaging with the emails. I took that list and I grew it to 1.7 million email subscribers in about a year. I think It's. It's over 2. I think it's like 2.2 million now. I gave this presentation a couple months ago in November at Craig Ballantyne's event, and it was at 1.7. And two months later, I think we're at like 2.2 or something like that. So again, we're talking about moving fast here, right? I added 500,000 names since this. I did this presentation two months ago. How many people would like to add 500,000 subscribers to your email list in the next 60 days?

I'm actually going to teach you how to do it. All right. And then it's going to be up to you. Do you want to execute it and do you have the confidence to pull it off? Okay. So I also went from not even having a social media account on any platform to 1 million followers on Instagram in less than five months. That one is just goes in line with everything else that I've done in business. I move extremely quick. I want to impact people as fast as possible. I want to move at lightning speed. My good friend Dan Fleishman is in the back. He's. He's one of the individuals, if you have a moment to chat with him, who helped me accomplish growing my Instagram platform so large so quickly. Dan is a master when it comes to networking with social influencers, and he has just a tremendous network of people. So if you're interested in growing your Instagram, trying to get in touch with Dan, to the back, at the very back table there. If you want to pop by and say hello and pick his brain a little bit, I'm sure he'd be happy to chat with you. Born Impact podcast. I launched my podcast on tub. Raven has been ranked in the top 10 of iTunes off and on since day one. We were just ranked last week number one in the category. So you can see here I have a track record of doing things big. My very first. This is my very first. I sold my first ebook and my 5000th ebook on the very same day. So if you think like you have to take a long time to.

Get established or to be have. Oh, let me just sell the first 10 ebooks. Well, yeah, I did that probably in the first three minutes. And then we sold 5,000 ebooks within the first day. So you don't have to take a long time. Of course there's preparation that's involved. You got to get all your ducks in a row. But I'm going to teach you that's. That's a lot of. What am I teaching in this presentation? All right, so I want to start by talking about this debate that's kind of going on, impact versus income. I want to hear from some people in the audience, maybe one who's on each side of the argument. Some people will say, oh, you get. Just go for the income, worry about the impact later. Other people will say, if you just focus on impacting, forget about the dollar, then the income will come. So let me hear from somebody what you. Somebody who's on the. Raise your hand if you're on the impact side and you want to share quickly what your viewpoint is on that. Why would you say impact? One person, Come on, is there one person in the entire audience who. Raise your hand. You don't have to speak. Okay. Raise your hand if you feel that impact is more important than income.

Okay? Now raise your hand if you feel that you should really focus on the income and the impact will come later.

Okay, interesting. Look, not everybody participated, but we about of those who did it was about 50, 50. So let me just give you my thoughts on this. Okay? Again, many people will tell you focus on impact and the income will come. And to that I say wrong. Okay? That's not the way that it works in the real world because I see so many people that have amazing products that can really potentially help a lot of people. Maybe it's a fitness ebook. And if somebody did that workout program or somebody did that diet program that you have all the expertise in the world to put that together an ebook for. Maybe it's a really quality product. Maybe it's beautifully designed. Maybe you spent a lot of money.

Recording videos and had a very high production value in the end product. And the products amazing. Can really help people. But if you don't understand marketing and you can't generate income, you're not going to be able to help anybody with that product. Okay? And the reverse of that is also true. If all you got is really good marketing. And there's a lot of shady marketers out there, black hat marketers out there, super aggressive, especially in the health and fitness space that will tell people that they can lose 30 pounds overnight and all this type of stuff. And people buy into the marketing and maybe the marketing is good, it's good copywriting, all that, but they don't really care about the customer. And once that customer accesses the product, it's not a lot of value there. Do you think that customer is going to go back and spend money with them again? You got them once with some great words on a sales page that got them to hit add to cart but you didn't deliver value on the back end. You didn't have any impact with your product. It's going to be short lived income. The customer value is going to. The lifetime customer value is not going to be much more than when they first came in the door. So both are equally important. You can't have scalable impact without scalable income, okay, is generated from marketing. The marketing has to be there. You can't just have a great product. You need distribution, you need traffic, you need conversions, you need people pulling out their credit card and saying, yes, I'm going to spend money. This is a great value, I need this. And then that's when you begin to help people. You can't have scalable income without offering value adding products and services that impact customers. So you have to have both, have to have great marketing and great products. When you do, you can bring a lot of customers in and then at the same time you can impact people for the long term because they're going to rebuy over and over and over again. Okay? So the question is, Joel, how, How did you do that? That was great. What you shared on that first slide. All the things that I've been able to do and accomplish. Again, it's not to brag, it's just to show you who you're listening to. How did you do that? How did you scale something? And that's what I want to share with you because I just stand up here and talk about.

How great I am, all that I accomplished. Look at my house, look at the cars that I drive, and all this like some of these other speakers will do to you without giving you true actionable nuts and bolts that you can jot down and actually go and apply to your business, then I would have failed standing in front of this room. That's not the type of speaker I am. I may not be the most dynamic speaker. I may not be able to deliver and make you laugh like some other people will. But I promise you that my goal is to give you more actionable strategies from this presentation than anybody else delivered this entire last three days. The secret here is that the lion's share of the traffic goes to an individual who can pay. How many people are selling something online?

All right, so it's like everybody.

The lion's share of the traffic, which everybody needs traffic in order to convert them to customers. Right? The lion's share of the traffic goes to the individual who can pay the most for it. Every time, always, without fail, traffic is an auction. Okay? If you can pay more than the next guy, you're gonna get the traffic. It's just like, if I'm a big email marketing guy and I can promote other people's products for a commission, which products am I going to promote? Well, number one, of course it's going to be products that I believe in, that I think are ethical, that I think have value and would be of value to my email list subscribers. But assuming that's true for all the products that are presented in front of me, valuable products, it's ethically marketed, which one am I going to choose to promote if I'm making commission? Which one? The one that makes me the most money every time. Okay. The one that gives me the greatest commission is the product that I'm going to promote to my email list every single day, 365 days of the year. I'm going to say what's going to make me the most money when I hit send now, And I'm going to pick that one because I'm running a business, right? I need to generate income to cover my ad spend and all these other things and to be profitable and to have impact. So it's an auction. And every single time, the winner of the auction is the person who bids the highest. So. So let's talk a little bit about that in more detail. So there's two sources of scalable traffic. What are they? Well, I'll tell you what they're not. It's not search engine optimization. It's not organic growth. Organic growth. I don't even know what that is. It's like if I wanted to build a business and maybe in 20 years have something to talk about, then I would go organic. How Many people know somebody who grew their social media following commercial completely organically. Not many people. And even those who did, like we interviewed on Born to Impact, we interviewed one of the only females that has been on so far, Amanda Bucci. And she, I think she had. She achieved 100,000 YouTube subscribers in something like six months, which was pretty, pretty remarkable. But I have built email lists to 300,000 people. I think we averaged about 400,000 new, new email acquisitions per month. In just one of my businesses right now, there's no way in the world, no matter how good I am, no matter how good I look, no matter how great my videos are, that I'm organically attracting people. And there's going to be that much social sharing and things go viral, you know, it's just not going to happen. And it's not a repeatable way to do business. So if you're trusting on organic growth, a lot of times you see on Shark Tank, somebody comes in and they say, oh, we did 10 million last year. And then this year we're. It's July and we're only at 2 million. And they said, oh, what happened? Well, we got on Oprah and then this went via, you know, on Oprah's book list or whatever and thing went viral. But it's not sustainable, right? Because organic comes and goes. It's based on what people are sharing, whether something happens to catch and go viral. But what I'm going to teach you is how to have a sustainable business that's very, very scalable. And you're in the driver's seat in your own control. The only scalable sources of traffic are those that you pay for. That's it. Okay, there's two types of traffic here. There's warm, warm traffic, which we call affiliate traffic, or maybe social influencer traffic. We're talking about social media where you pay that person a commission or you pay them a flat fee to get in front of their audience. Okay? They endorse you. Maybe they send an email on your behalf, they make a commission for referred sales. So there's that. I am an affiliate for many companies with my email list. If you have a product that can generate that is of value to my customer base and you pay a great commission, you got a great conversion rate, and I'm going to make good money with that. I'll certainly consider promoting the product. Okay, so warm affiliate traffic, where you're paying a commission and then you have cold media.

Or also known as pay media, which you're paying a cost per impression or A cost per click or a cost per sale? The cpa, cpm, cpc. There's a lot of different ways that you can skin this cat. But bottom line is you are paying for your advertisement to get in front of people. You're paying on a click basis, on an impression basis, or on a sale basis. Okay, Both of these are. Go back to that whole concept of an auction. I'm going to promote the product that's going to make me the most money 365 days a year. I'm not looking at it at all the products that I have available to me to promote. And I say which one's going to do just about average for me today? I'm going to send that. Okay. Or which one is going to do below average? I'm definitely not even considering sending that, which is it has to be above average. And what I think has the potential to generate the most revenue on any particular day. And that's how all the traffic sources, all the affiliates think the same way. And all of the people in charge of paid media think the same way. Facebook, Instagram, all these places, places where you can run ads on social channels. It's all an auction. If I can pay a dollar a click and I have the same click through rate as somebody else, and they only can afford to pay 60 cents a click, guess what? My ads show way more than their ads show. Their ads probably don't run because I'm outbidding them. So you have to be at the top of the food chain when it comes to paying for traffic in order to get almost all the traffic. If you're somebody who can't compete with, with, at the, you know, at the top 5% of bidders, you're gonna have a really difficult time getting traffic. Same thing with affiliate plays. If your offer earns below average for people, people are not going to promote that. Even though you are paying them commission and maybe you're paying them, you know, what you feel is a generous commission. We need to look at some other areas and that's what we're gonna do. Traffic as an auction. And traffic always goes the highest bidder 100% of the time. Everyone understand that concept? That's the concept for everything else that we're going to talk about. So then the question is, well, how can I afford Joel to pay more than everyone else? I'm not rich. The money that you have in your bank account has close to zero to do with this. Okay? You don't have to be rich. I'm not talking about giving Away money and just.

Paying for traffic that doesn't make business sense. I'm saying, hey, how can I roi the traffic that I'm paying from and how can I be that guy who's willing to pay the most? So, maximizing two critical areas of your business. What are two areas of your business that have to be dialed in in order for you to be extremely successful and grow? One is acquisition, customer acquisition or lead acquisition. That's the front end, right? You bring people in, you have to funnel people in. Then once you have them in, they're a customer, or on your email list, they follow you on social media. Then you move into the next part, which is the monetization aspect of it or the backend. So you're bringing people in and then you're monetizing that group of customers or leads on the back end. Everyone's probably very familiar with this, but let's look at it a little deeper. When those two things are completely dialed in and you know your numbers, you see, I bolded that because this is the most important thing here, you can confidently outspend the competition. You have really great front end, a really great back end, and you understand what a customer is worth, what a lead is worth at certain time intervals. 30, 60, 90, 120 days, 180 days, three years, whatever it is, whatever data set you want to look at, you know your numbers. If you asked me, you know, Joel, what is an email lead worth from XYZ affiliate, I could very quickly look that up in my database that I have that were my all the reports that my reporting guy puts together. And I could say, well, when so and so refers me a lead from their email list, I see that it's worth this at 30 days, this at 60 days, this at 90 days, this on average at 180 days at a year or whatever. That helps me gauge what I can pay that person, right? What I can afford to pay that person for. Most lead acquisition, we pay $2 a lead. But there's some. When I look at the numbers, I say this is backing out very quickly for me. If my goal is to be at 90 days break even and at $2 paying them, they have really good traffic. Maybe it's an all customer list and it backs out at 30 days. What's my reaction to that? I'm going to go back to that affiliate and say, hey, I can pay you more if you can send me more traffic. I'm always negotiating deals. I'm not just going to say, hey, I'm just going to pay you more, right? There's going to be something in it for me. A win win. I will pay you more. I can bump you up to $3 a lead if you can. If you can commit to sending for me at least once a week. Okay? And I know that the numbers will work out because I have the data in front of me. To know that at $3 is where I need to be to break even at 90 days, which is my goal. And now I can get more traffic from that person if I bump them from $2 to $3. And the mailings did well at $2, what do you think's gonna happen? They're gonna mail more for me, right? They're gonna mail more for me. This is how you get more traffic, guys. So another big question is, do you know your numbers? Do you know your cost to acquire a customer? How many people will say, you know your cost to acquire a customer down to the dollar? Okay, that's, that's a really poor showing for a room like this. Okay? And you have to know this, if by the end of this presentation you, you take one thing away from it, it's gonna be this. You have to know your numbers to run a business. Otherwise you're just kind of flying in the blind. You're just, just shooting in the dark and you're just hoping for the best. Okay? You have to know your numbers in order to grow and scale a business. So some of you did raise your hand and said, yes, I do know the cost to acquire a customer. Maybe it's $30, $50. Maybe you have a really high ticket product and it's a couple hundred bucks. Okay, but then a follow up question to that is, do you know your cost to acquire a customer for every traffic source? I know my cost to acquire a lead for every single affiliate that promotes me. And it's on average around $2, but it could be as low as a dollar, up to maybe $3. Okay? So I know, I also know that on this particular channel on social media, I can get leads for 80 cents. On email, I have to pay more because they're higher quality subscribers on what we call paid email, which is like renting other people's email lists and they send on your behalf as a sponsor. See the message below from our sponsor. Those tend to be a little bit more expensive for me, but I still know my numbers so that I know if I can back it out or not. Okay? So you have to know your, your cost to acquire a customer or a lead. And you need to Understand it from every slice and dice it from every single traffic source.

Do you know the value of that customer at 30 days? 60 days, 90 days, 180 days. This is where the real magic happens, right here. Because I know that if I, let's just say I'm comfortable going in the hole 60 days up front and I know what a customer is worth at day 60, that's what I can start paying to get customers. My goal is to break even at day 60. If I know the value of that customer at day 60, that's what I can start paying to get a customer. If I don't understand my 30, 60, 90, 180 day lifetime value of the customer. Now I'm just stuck paying at maximum break even on the front end. Let's say I have a $30 ebook that I'm selling. The average order value value on that funnel is 30 bucks. I can pay 30 bucks and then I don't know what the customer's worth after that. So I can't say, ah, can I pay 50, can I pay 60, can I pay 45? Whatever. You don't know the numbers on the back end, so you can't confidently make that judgment call. Okay, we're going to talk about knowing your numbers a lot more. So let's talk about acquisition leads versus customers. There's two different groups. You can acquire leads, which I've gotten really good at, acquiring lots and lots of leads and then converting, converting them to customers, or you can just go straight for the customers. Lead acquisition casts the widest net. You can have a free report, a quiz, you can have.

Some sort of assessment or something like that where you're dumping people into something, collecting an email address and giving away something for free, like a digital download. We, we do free reports. We found work very well, video courses, all these types of stuff.

That's the widest net. But it's also requires the largest investment because when you're giving away something for free and you're paying for traffic, you're relying entirely on the back end to monetize or ROI that traffic. Okay? To get a return on investment. If I'm paying $2 for a lead and I'm giving away something for free in exchange for that lead, which I'm paying $2 for, now I got to make up the $2 on the back end. So you're, you are always in a position when you're acquiring leads of losing money up front. A lot of people are not comfortable with that. So let's just talk about starting baby Steps here. Let's focus on customer acquisition. How do you maximize a sales funnel? Again, how many people here are selling something online? Okay, your goal as an online advertiser is to have the best marketing, the best conversion rate, the best average order value, all that stuff. So you can maximize that entire funnel and you can get the highest average order value with the highest conversion rate. So you can get the most customers in and you can be in a good financial position when you're doing that.

That comes down to what, your marketing copy. Right, Your marketing. If I could just improve my marketing copy, I can improve my conversion rate. Maybe it's look and feel of the website, maybe it's.

Making your advertising more authentic and transparent. More transparent. Whatever it is, you're taking a look at your marketing copy, that'll increase your conversion rate. All else remaining equal. If I have a higher conversion rate, I'm going to be able to pay more for traffic because I'm getting more people actually paying money. Right?

And then you have your upsell flow and the marketing copy that's in your upsell flow. How many, again, out of those people are selling something online? How many of you show that customer upsells after they buy? Immediately after they buy, they go into an upsell flow, raise your hand. Okay, that's like maybe 10% of everyone is selling something online. For us, we see that through upsells, we add 50 to 100% more revenue immediately. How do you think that changes the game for what we're able to pay for traffic?

It dramatically changes the game, right? Because let's just say my ebook costs 19 bucks on the front end. $19, and then that's it. Thank you. Here's your Receipt. I made $19. I can spend 19 bucks to acquire a customer, and that's about the best I'm going to do. Even if I knew my numbers on the back end, maybe I could spend 25 bucks or something like that and go in the whole 60 days. But still, I'm only able to spend 25 bucks to acquire a customer. And if all the traffic is going the highest bidder, $25 isn't a whole lot. If I can increase my funnel, we have an E book funnel, that's $19 front end. And the average order value is 35 bucks on that funnel. So I think it's about, you know, it's about 75% more revenue on that. And now what can I pay for a customer?

35 bucks and break even. Right? And now if I say, okay, 35 bucks, number one, they're a better quality customer because they're spending $35 with you, as opposed to 19. So they're already raising their hand and saying, you know this. I'm likely to spend more money. And you're training them to spend more money from the very beginning.

And by doing that, by having that 50 to 100% more money now, I have a lot more money to play with. Now I could spend 35 bucks instead of $19. And if I want to go on the whole 60 days, I know that on that particular funnel, I make another $12. So now I can spend 47 bucks as opposed to 19. If I can spend $47 to acquire a customer, and that guy with no upsells with the same conversion rate as me with a $19 product can only spend 19, who do you think is going to get most of the traffic? I want to dominate that dude every single time. Okay? If you can pay 19 bucks because you're scared to sell people after they buy, and you don't want to have upsells, and I know how to do it tactfully and ethically, and I can get my. And I can go a little bit in the hole and spend $47, guess what? I'm gonna. No one's even gonna pay attention to you. I'm gonna get all of the traffic. And that's what it is. When it comes to.

Is an affiliate gonna mail for me? Is Facebook gonna award me ad placement? Are my ad scalable? Will my ads even run? Okay, it's all an auction, and you have to find ways to. To be able to pay more for traffic. So upsells is a great way.

You know, some. Some people have the mentality that, look, Joel, I don't want to sell too hard. I just want to put, you know, my good product in front of people. I want to charge a fair price, and then I want to leave them alone. I don't want to bother them with a whole bunch of upsells and all this stuff. I used to have a very similar viewpoint on selling. I thought selling. You know, there's a couple different ways to sell, right? You can sell like the used car salesman, or you can sell in a responsible way that gives people great deals on products that will add value and solve problems for them. If you're doing the latter, then you should want to sell as much to them, because you know that every time they invest with you, they're getting 10 times the value of whatever you're charging. So reframe your way and Your mindset on selling. When I started out, I started as a personal trainer. When I was in college. I was interning at Gold's Gym and me, the guy who's, who's building $100 million companies and email it and acquiring 300,000 to 400,000 emails a month and selling, creating, converting all these people to customers. When I was at Gold's Gym, I was the lowest revenue producing trainer in the gym because I didn't want to bother people when they were working out. I didn't want to, you know, feel like I was annoying people and trying to get them to sign up for services. But guess what? Most people in that gym were not getting results. They would come in, they would waste their time doing some workout that doesn't really get results. And I'm the guy who had a solution for them. I'm the guy who said, hey, I got a great program. I see you've been in here for the last six months. How are your results coming along? Well, slower than I had imagined. Well, how about we just, I give you a couple complimentary sessions. I'll take you through some really challenging workouts that are, you know, we'll do an assessment and I'll make sure that you have a workout that's tailored to you, that's actually going to get you the results. So that when you come to the gym and you're spending time here and you're investing time and money in this membership, that you're actually going to see the results in the mirror that you want to achieve and in your health.

For me, I didn't think that way back then, but today, if you put me in that same goals gym today, I run circles around any trainer in there. I don't care who you are because I understand the value that I'm bringing. I can solve your problem and I can exchange something extremely valuable for you results for, you know, a good price. That makes sense. Okay. So don't worry about selling too hard. If you have complementary things that you can upsell after somebody comes through your funnel, then sell them that they need it anyway to make their life easier to solve their problems.

Then you have average order value and you have cost of goods. Right? If I can increase my average order value, I lower my cost of goods. I can add more money through upsells. Now I can spend a lot more money to acquire a customer. And when you can spend more money to acquire a customer, you're going to get more traffic every single time. Okay, so what's the point of front End optimization. You have the highest conversion rate possible. They have the highest average order value possible. You have a great conversion rate, and then you have a really high average order value. Put those two things together and you can start comfortably paying for more traffic. Again, that $19 ebook, if all I can afford to pay is 19 bucks, that's not going to be it. But if I increase my conversion rate now, I can pay a little bit more because I'm acquiring more customers, I'm collecting more revenue, I can increase my conversion rate and then also increase my average order value through up upsells. Now I can pay. You know, I gave the example of how $19 can turn to me paying $47 for a customer very quickly. I'm gonna get way more traffic. All else being equal, the guy who can spend $100 to acquire a customer will always get exponentially way more traffic than a guy who is only willing to spend $30. Okay, that makes sense, right? If somebody is willing to give me $30 per sale, all us the same, the conversion rate's the same. They're both quality products. Someone's willing to pay me $30 a sale to refer them a sale, and another guy's willing to pay me 100. I'm going to promote the guy who's willing to pay me 100. Everything else is pretty much the same. They're both great products, both convert the same. You're going to pay me 100 per conversion, and you're going to pay me 30 per conversion. All right, I'm obviously going to pay. I'm going to go to go with the guy who's going to pay me more, and so are all the advertising networks. All right, this is not just. It's not a personal thing. These are people running a business and they rely on revenue coming in. And to maximize that revenue, they're going to give the ad placements and the mailings and all that to the person who can pay the most for them. All right, so here's an example. Here's a $50 average order value digital product funnel. Okay? This is an example. How much should you pay an affiliate? How many would say that 75% commission is a pretty generous payout? I have a 50. I'm collecting $50 from the customer. My average order value is $50. Again, this is a digital product, so there's no hard cost, 75% commission. How many would say that 75% commissions are pretty fair commission to pay? Okay, how many people would say that 100% commission is a better commission? To pay to the affiliate. Yeah. But you may say, well, for me, for a business, it's not better for me because I'm giving away more. Yes, it is better for you. It's always better for you to pay more as long as you can afford to pay more because you're going to get more traffic. Right? So let's look at this. This is 100% commission. This is the absolute lowest you should ever be willing to spend to acquire a customer. Whatever your profit margins is. Let's say you're selling something. Again, assuming this is digital, if it's cost of goods, just subtract your cost of goods out of it. Say it's $50 and your cost of goods is 10 bucks and you got $40 to play with, you should be at least spending $40 to acquire a customer. If you're spending less than that, then there's room to buy more traffic. Okay. Or scale your campaign larger. So the absolute lowest you should ever be willing to spend is 100% commission. I'll give you an example of somebody who just did not understand this concept. And they lost out on me mailing millions of people for their offer. I had an offer. I heard it converted. Well, I contacted them. I said, hey, I'm interested in promoting your product. We require at least 100% commission. I'll test it at 100% commission, and then based on the results, I'll let you know if the numbers work. If not, we can try and work some sort of bonus structure out or whatever for. For volume. They said, oh, I'm sorry, the highest that we pay is 85%. So. Well, I have a email list of 3 million people that I would love to send your offer to pay me 100% commission. It's a free customer. I will test it and then depending on the results, we can talk about specifics after that. And came back and said, oh, I'm sorry, the highest we pay is 85%. Maybe you hear me when I said I have 3 million people that I want to send to your website, and all I'm asking you to do is not lose any money at all. Just give me the commission that equals what you're collecting, and then you have the customer for the rest of your life to monetize and make money from. Okay. He came back and he said, that would make our other affiliates mad who we only pay. I said, I don't know them. I'm not going to tell them.

I'm trying to work out a deal here. Do you want the traffic or not. And I said, let me just end with this story here, okay? Let me just end with this example, and you tell me what your thoughts are. If I said, let's say the guy's name was Steve. Hey, Steve, I want to send you 5,000 customers for free. Okay? I actually, I just took 5,000 of my best customers. They recently opened emails, they clicked on emails, and I even told them all about you. I endorsed you. And I said how great of a guy Steve is, and he has great products and services, and you should be expecting to hear from him because he has some free stuff to send you. And I just went all out for you, endorsed you. And then I put those 5,000 customers in a spreadsheet, and then I emailed them over to you and said, steve, here you go. I told these guys how great you are. These are my best customers. They all recently opened emails. I click on emails all the time, and they even buy things or customers, 5,000 of them for free. Here you go. What are you going to do with that? Are you going to take that spreadsheet and upload it to your email list and start marketing to them and making lots of money from them? Of course you are. You'd probably be like, thanks, Joel. You're the best ever. That's all I'm asking you to do here. Same thing. Let me send you a bunch of customers for free, and then you can monetize them for the rest of your life. And he came back and said, the highest we can do is 85% commission. And then I was very tempted to just shoot myself and put myself out of my misery, but I didn't, and I promoted someone else's product instead. The real magic here, real scale, comes from dialing the back end, knowing your numbers, and being able to comfortably lose money up front. Comfortably lose money up front. You dial in the back end, you know your numbers down to the decimal point for your traffic sources, then you can start to comfortably lose money. The key word here is comfortably. No one wants to lose money. But if I know I'm going to make it up over time, I can comfortably spend more than I'm bringing in. Say my average order is 50 bucks, right? If. If my. My average order value is 50 bucks, if I'm here and I know that at day 60, there were 70 bucks and I can spend $70, I know, like the back of my hand, they're worth $70. I see the numbers over and over again at $70 on average at day 60, and I can spend 70 bucks. How much more traffic can I get when I'm spending 70 versus 50? It's a lot more. After you acquire a customer, you go to the back end. When's the best time to start selling them more impactful products and services at a tremendous value? When's the best time after you acquire a customer, when's the best time to start selling them more stuff? Immediately. Right away. Right immediately. Where is the best place to start selling them? Where exactly is the best place to start selling them more impactful products and services? So they came through my funnel, they purchased my ebook product and it's. The funnel is now over. Okay, their credit card, they saw all the upsells done. Where's the best place after that to start selling them more impactful products? How many people have a a receipt, an order confirmation page or a download page? If it's a digital product, how many people have a receipt? If you sell somebody, you show them a screen that says your order is confirmed. How many people have that? Everyone. Everyone. Okay. Every single person has one of those. And guess what? That's the best place to show them another offer. Okay, here's the thing here. Impactful products add a tremendous value. If I can give them something that's going to add value, add a great value at a discount at a no brainer cost to them, I should do that immediately. Here are some places you can do that. The order confirmation page, the order confirmation email and the shipping confirmation email. How many people, after they buy something from you online, you send them an email with their order confirmation? How many people send an email with their order confirmation? Here's your receipt, here's what you spent, right? Everybody gets that. You get that from Amazon, you get it from everywhere. Everywhere. You buy something online, that email has like a 95% open rate. You know when the next time I'm going to see a 95% open rate on an email is never. It's never going to happen again. So if I don't maximize this order confirmation email and this shipping confirmation email which probably gets like an 85% open rate, if I don't maximize those two things, I am really missing the boat. Because it's the highest open rate emails I'm ever going to get. If I can put in front of them another great offer that makes sense, maybe get them into coaching or something like that, that's a premium, premium placement to do that right away, then what you have back end email marketing, social retargeting, stuff like that on the back end so they go through your Funnel, Then you have your confirmation emails, your shipping confirmation, you have your order confirmation screen. All those are great places to offer them value add products. And again, everything that they buy.

That you can get on day one through that order confirmation email, maybe you can add a couple bucks per customer through the order confirmation page. Maybe you can order at a couple bucks through the shipping confirmation. Maybe you can add another dollar or something. Let's say altogether you can add another five or six bucks. Now you can be comfortable paying another five or six dollars for traffic. And when you can do that, you're going to get the lion's share of the traffic. Okay, so what's the point of backend optimization if you understand the value of a customer by offer and traffic source? Okay, because it's always different at specific time intervals. 30, 60, 90, 120, 150, 180 plus days. Okay? When you understand that, then you can comfortably lose money on the front end. So let's look at this example. I have a $35 average order funnel with great conversions from warm affiliate traffic. Okay? And in this example I'm comfortable going 60 days in the red, meaning going 60 days in the negative, which is conservative, and paying the affiliate $50 to acquire a customer. Because I know that at day 60 they're worth an additional $15. I also know from my data that at 36 months they are worth another $50. Okay? So I'm paying $50, okay? And I know at City at 36 months they're worth $100. Can I afford to pay $50? They're worth $100 after 36 months. Can I afford to pay 50 bucks? Yes, of course I can. I'll do that all day long, right? All day long. The problem is most people don't know this number. They don't know. They don't know this number. What is 60 days? What is my 60 day value of this customer? Some comfortable going 60 days negative, but I don't even know what that number is. So how can I pay that? I don't know the number. And then what's my three year value? I have no idea. I have no idea what a customer from this affiliate is worth at 36 months. So how would you know? How could you gauge what your profit's going to be if you're going in the red up front? But it's almost required these days to go in the red in order to be competitive in the marketplace, in the auction to get the most traffic. Okay, so this is the whole point, guys. If I know beyond a shadow of a doubt that customer is going to be worth 100 bucks. I'll pay $50 for it all day long. Why does this matter? What happens when you're able to spend 42% more? So instead of $35, I'm paying the affiliate 50 because I know my numbers at 60 days. If I didn't know my numbers at 60 days, I couldn't comfortably pay $50. Right. But I know like the back of my hand, it's, they're going to be worth $50 after 60 days. Okay, another 15 bucks and I can pay this. What happens when you're willing to pay 42% more? If you do the math, that's 42% more to acquire a customer. How much more traffic are you going to get? 42% more traffic. You're going to get three to ten times more traffic. In general, if you're able to increase by 42% of what you're spending, you only have three to 10 times more traffic than you're getting. When you're at the very top, you get pretty much. That's when you scale offers and you get almost all the traffic that's available. That's how you have a company that starts with eight people and you do $100 million in revenue within 16 months. Because we put the best marketing out there. We understood our numbers, we knew our back end, and we're very comfortably losing money on the front end. And we scaled that. And you think by the time that we hit a million, a hundred million in revenue, that we were profitable? Yes, we were very profitable. Okay. Because at any given point in time, I'm only paying for the traffic in the last 30 days, but I'm making money from everybody else that came before that. Right. So now you're not. In six months, nine months, a year into a business, you have all these customers that you've already paid for the traffic. You've already made up what you lost on the front end, and now you're profiting from the lion's share of your customer base, and you're only paying for that acquisition cost on the most recent customers. All right, so here's exactly the situation on a trade. Hey, Joel, did you say you're going to give me $100 or if I came to you, I said, look, I'm going to give you 100 bucks. Okay, I'm going to give you a hundred dollars. All you got to do is just give me 50 right now, and two months from now, I'm going to give you 100 bucks, and you can do that as many times as you want. I'll give you the opportunity to do that as many times as you want. Right now. Give me as many $50 bills that you can find that you can dig up, maybe go to the bank and pull some money out of your account, as many $50 bills as you can give me. And in two months from now, I'm gonna give you $100 bill for each one that you give me. How many of you would do that? If you believe that I was really going to give you the hundred bucks, right? And maybe I signed a contract or whatever. If you believed and you knew with confidence that I'm going to give you $100, you do it over and over and over again, okay? But again, so many people are scared to lose money on the front end because they don't know that eventually that customer will be worth $100 and win. So why are people not doing this? And this is what I call the fear certainty scale. You can see on this scale as. Let's pick any point on this line. Let's say right here, where certainty is very high. Where's fear? Fear is very low. When you're very certain about something, you're not that scared about it, right? Because you know, you know, you know, you know your numbers, you have a high degree of certainty. You go down to the fear scale, it's very low. When.

In this situation, fear is very high. But where is certainty? I don't have very much certainty. So now I have a tremendous amount of fear. I can't comfortably invest $50 to buy a customer when I'm only collecting $30 up front. I'm fearful that I'm never going to make up the Delta, the $20 Delta. Right? But when you know your numbers and you have a high degree of certainty, then the fear goes down. Same thing here. The complexity and comfort scale. Okay? Pick. Pick a point on this graph at the top. When things are very complex, most people are not very comfortable. Okay? When things are very comfortable, complexity is low. But when you put yourself in complex situations over and over again, you become more comfortable with complexity. You may say, joel, it sounds like a lot of work. Like, I have to know. I have to have this database that you're talking about, and I need to have a reporting and an analyst, and I need to know my numbers at 30, 60, 90 days. I don't even know how to start. You think I knew where to start? I didn't know where to start. I had to Learn it. I had to figure it out. I had to ask questions, I had to talk to people. I had to get on LinkedIn and talk to an analyst just to wrap my head around what needed to be done. Then I had to hire somebody. Then I had to put a database in place, all this stuff. Now I have the numbers that I can use to scale my business though. Was it worth it? Of course. 100% it was worth it because I would never be able to grow a company to $100 million without knowing my numbers like the back of my hand. I would just be guessing. And you cannot run a company and scale a company like that. This is what you ultimately want it to look like. Next slide. Okay. At any level of complexity, not very complex, my comfort is high. You know, average complexity, my comfort is high. Very complex, my comfort is high. And how do I do that? I constantly put myself in uncomfortable positions and I figure it out. No matter what the complexity is, I figure it out and then the next time I'm put in that same position, I'm more and more comfortable with it. Okay? You have to get used to complexity and you have to be very certain. When you can be certain in complex situations, then you're going to be very comfortable with spending money. The money that you should be spending in excess of 100% commission, going in the negative to scale your business. All right, so four steps to scale any business here. Maximize your front end offers through testing optimization. Refining your marketing skills. You may say, but I don't want to do the marketing, I want someone else to do it. How many of you say I'm the face of the product, I'm not really the marketing guy. I want somebody else to run my marketing. I just want to create good products. Okay? A lot of people fall into that category and that's fine. But you need to have somebody in your business, a business partner or something, somebody who's a partner in the business, invested in the business to do the marketing. If you're trying to outsource marketing, it's never going to work. These people have too many clients. They're never going to think about your product as the most important like you would as an invested owner. So some one of the owners has to be doing the marketing, okay? And that's what I am for BioTrust. Dial in your back and know your numbers. Know your numbers. All right? Know your numbers. Just write that down. 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. Where's 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 in negative up front. Okay. Number three, do the work and get comfortable with complex backend reporting. Got to 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 upfront to outbid your competition and get the lion's share of the available traffic in your industry. Going negative up front is, is something that most people are not willing to do because they're fearful that they 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 the 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, Bottom line, responsibly pay as much as your cash flow allows to acquire new customers up to 180 days negative up front gradually increase as your certainty and cash flow increases. So maybe you're starting off and say, joel, I can't afford to go 60 days in the hole because. And scale and offer because I'm just going to be way too far in the red and then I still have to go 60 days to make it up. That's fine. Maybe just say you're going to go two weeks negative first. Okay. And most, most of your terms on, on ad spend, you can pay for this stuff 30 days later. So just Start gradual and as your cash flow improves, you can, you can now you can go 30 days negative. Then you can go 60 and maybe go 90 up to 180 days. I wouldn't recommend going more than 180 days in the whole on customer acquisition. Although I do know some companies that take a year to back out their ad spend. But you know, the market's just too volatile, especially with the Internet to go that deep for me even so up to 180 days. But if you can responsibly pay as much as your cash flow allows, acquire new customers up to 180 days negative, gradually increase. This is how you scale your business, your message, your passion and your income. Thank you.

I do have a one more thing. Real quick. If just just one, one moment. If you enjoyed and got value out of this presentation, I asked that you can help me in just in a couple ways here. Number one, you follow me on Instagram at Joel Marion. It's all for impact. I don't monetize it in any way. Number two, you go to itunes. Subscribe to the Born to Impact podcast. It's my favorite thing that I'm doing right now. It's what I'm most passionate about and I believe it is the thing that I'm doing that's having the most impact and have tremendous guests. Ryan, we're Ryan on the show in the next couple of weeks. Just had Grant Cardone on the show and in the next week I'm going to LA right after this. I'm recording with Jim Quick, Tim Story, Ed Mylett and a bunch of others. Share the podcast if you enjoy it with at least one person. And then lastly, my partner and I, Josh Bazzoni have really been helping companies who understand Amazon and retail, but they don't understand direct sales very well to scale their businesses. We're obviously masters at this and we've done it at a very high level where we sell only we just got on Amazon maybe a year ago, but we've sold over $500 million in product direct to consumer through our own website. Most people don't understand how to do that. Maybe they figured out Amazon. A lot of people in this room may fall on that. If you're somebody who says hey I have a really good product, a really great Amazon based business or retail based business, but I want to sell more online direct to consumers Consumer send an email to support Transformation Insider that'll go to my team and they'll forward me anything that they think is that I would, that I would like to see from this event and I'll give them a heads up that they're coming. But we've just invested in three companies recently, Josh and I, where these companies are very established on Amazon and or retail and they're looking for help to go direct to consumer and have their own website where they can generate their own here's the problem with Amazon. It's great in some ways, but it's terrible in other ways. One, you don't get the customer information. It's very difficult to remarket to them and you're just relying on them coming back to Amazon. Amazon does some of that work for you, but they're never going to do it like you would if you own the customer and the customer information. So if you're interested in that, shoot an email supportsformationinsider.com right. Thanks guys. Get up for Joel. Thank you.

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 Kerwick 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 Studio, these covered topics explored, or frankly, just any questions about branding in general, just shoot me an email@maxmaxrandbuilderstrategy.com again that's maxrandbuilderstrategy.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. These things really do make a big difference in helping us book amazing guests.

And then also helping people just like.

You find the podcast.

So thank you.

Thanks and we'll see you next time. There are two kinds of people in this world. There are members and non members. If you are enjoying this stuff you have got to join us inside the 1%. 1% members get access to our courses on building businesses and investing the profits. They get access to experts who are bringing in lessons on a regular basis, some of the best in the world and they're joining regular calls with myself or members of my team to keep the community growing. The 1% is a community of entrepreneurs who are actively building businesses and investing the profits. And every month you get a community newsletter to see what's going on in your community and what the opportunities are to create the ch change that you want to see in your world. Join us at capitalism.com the number one that's capitalism.com one.