Unraveling the Power of First-Time Offers with allies4me Founder, Craig Andrew

Hello and welcome to this episode of The Unnoticed Entrepreneur with me, Jim James, here in the UK. Today we're going to Austin, Texas to meet Craig Andrews, and we're going to talk about irresistible first-time offers. Craig, welcome to the show.

Jim, it's such a delight to be here. Thank you for having me. I've been looking forward to it.

Well, me too. I mean, we're going to cover some ground about, you know, what is a, an, a first-time offer, why it's so important, especially with high-ticket offers, uh, for, for consultancies and businesses. But you're also going to give us some, some special giveaways at the end, which will be fantastic. And you know your backstory, you came out of a coma and learned some things as a result of that that made you really reconsider what a first-time offer is and what we should do as business owners when we're going after our clients. So Craig, tell us, what is a first-time offer and why is it important?

Yeah. So, a first-time offer is a ridiculously cheap introductory offer that brings somebody into your world. And I'll give you 2 examples that everybody can relate to. One is years ago, there was Columbia House Records had a deal when albums were popular the first time that if you gave them a penny, they would give you 13 albums, 13 albums for a penny. And so, if you're the type of person that wanted to build a record collection, this was a harder offer to turn down. And obviously, Columbia House Records made tons of money with that. So, that's an example of a simple offer. And we tried that for our high-ticket service and it failed miserably. And we realized we needed to make one that's a little more complex. And so, here's another example of a complex offer that everybody that's listening can relate to. There was a guy named Bob Stupak who bought a dumpy old hotel at the end of the Vegas Strip. I mean, it was just a low-quality hotel. He bought it. He renamed it to Bob Stupak's Vegas World. And he ran a promotion and he said, give me $396 and I will give you 3 days and 2 nights in one of my deluxe suites. When you arrive, there will be a bottle of champagne waiting for you in your room. All of your drinks on property are free, whether you're gambling or not. Even if you're sitting in one of our entertainment lounges, you pay nothing more for your drinks. Not only that, but for your $396, I will give you $600 of chips to use in my casino. Now, when you hear that offer, there's a few things to notice. One, there's 4 elements, and that's where we're moving into the area of a complex offer. But when you look at it, if you're the type of person that likes to drink and gamble, that's a hard offer to turn down. And it worked very well. That hotel, it's— I believe it's now called the Strat. It used to be the Stratosphere. You know, it's now a part of the Vegas Strip. So, if you're the type of person that likes to gamble and drink, it was a great offer and it brought in the business. But something else that was really interesting about it is That's not an offer that appeals to me. I'm not a gambler. And I'll drink, you know, some wine, but unless they're serving really nice wine, I'm not going to get my money's worth off that. And so it actually repels me, which is a good thing for Bob Stupak, because Stupak knows he makes the most money when every one of his rooms is filled with somebody who likes to gamble. And especially if they like to drink because they probably gamble more. And so, he doesn't want me staying in his hotel. He's not going to make as much money off me. And so, those are 2 examples of first-time offers, one for a simple product or service and the other for typically a higher-ticket, more complex product or service.

Now, Craig Andrews, you run a company called Allies4Me. Tell us, how does that work? What's your proposition then? Because the first-time offer, when it's complex, potentially could be a loss-making offer as well, couldn't it? Because, you know, in the case here, we had British Airways many, many years ago. They offered a, you know, a free flight if you bought a vacuum cleaner. Famously cost them hundreds of millions of pounds. I have to say, I did buy a vacuum cleaner and got a flight. But, you know, How do you make sure that a first-time offer isn't really a loss leader? Because most companies can't afford that kind of exposure.

Well, yeah. So, sorry to disappoint. You're almost certainly going to lose money on the first-time offer. The key is you have to, for it to work, you must understand the lifetime value of a customer. And all you're doing is you're moving some of that money out of the lifetime value bucket into the cost of acquisition. And as long as you understand that and it's a profitable operation, you can do it. I mean, and I'll give you an example. I had a client years ago when we started talking to him, I asked him, I said, well, what's the lifetime value of a customer for you? And he sat back and thought about it. A lot of times we have to coach people through this just to kind of get in the ballpark. And he said, I think lifetime value is somewhere between $4 and $5 million. So, okay. I said, well, if the lifetime value of a new customer for you is $4 or $5 million, how much of that $4 or $5 million would you be willing to spend on acquisition? And he kind of paused and he thought about it and he said, you know, I'd be willing to spend $1 million. That's the highest number I've ever gotten. But you can see, he said, okay, you're telling me that if I give you $1 million, you'll give me $5 million. I'll take that deal.

Craig, that's a really wonderful insight that the FTO, the first-time offer, has to be seen within the lifetime value rather than within, let's say, the first transaction. Because that changes, doesn't it, the dynamic? Does that mean the FTO like that Really only works if you have, for example, a subscription-based product? I mean, you mentioned the record labels, or can it work with almost any product category?

So, I'm going to speak specifically about high-ticket items. It generally, I've yet to see the place where it doesn't work. And, you know, if If you're selling something you can buy on Amazon, or could conceivably buy on Amazon, you know, I don't necessarily recommend that. But if you're looking at higher ticket things, so it's good for consulting services, it's good for coaching. Let's say you have a, you know, a £20,000, you know, rejuvenating retreat, you know, restructure, re-strategizing retreat. Well, you know, it's probably going to take a little bit of heavy lifting to get the £20,000 out of somebody's pocket. And so, what they want to know, the big question they have is, if this retreat delivers the results you promise it delivers, I have no problem spending that £20,000. But I don't believe you. I don't know you. I don't trust you. You know, and they don't say that overtly, but that's what's being processed in their mind. And so what I would advise for somebody in that category is I would say, you know what, look at their pains, look for a couple immediate pains that you could take away that would give them a taste of what they would get in the retreat and go and do that. And when you do that, because when you help somebody solve a problem in their life, it builds unbelievable amounts of trust in very short times. And once they do that, they're— and this has been our experience— people are like, oh my goodness, yes, let's keep going. That felt good. The trust is overwhelming.

Craig, now, you know, we mentioned it very briefly in the intro, your personal backstory. And I don't want to embarrass you in any way. But, you know, you had a backstory experience that led you to this, you know, this realization that That trust is going to be the central part of any relationship. I don't want to delve too much into the history of that, obviously, the medical side. But do you want to just explain to us, you know, when you came out of that, that coma, you know, what had happened that made you realize this and the genesis of the FTO for you?

Yeah, so I was in a coma for 6 weeks back in 2021. And when they put me in the coma, the doctors told my wife I was going to die. And my wife, this was when they weren't letting family in the hospital. My wife said, sorry, wrong answer. And she kind of bullied her way into the hospital. They eventually agreed to give her an hour a day. And she would come in, she would sing to me, she'd pray over me, and she'd say words of encouragement. While I was there. And when I came out of my coma 6 weeks later, something fantastic had happened, something amazing, maybe not fantastic, but my trust in the doctors had plummeted. I'd lost all trust in the doctors. That's the not so fantastic part. The fantastic part is that my trust in my wife had absolutely skyrocketed. And this all happened while supposedly I was out. Well, I was telling my wife about one of my dreams, which at the time I thought was reality. And I told her about how in my world, I was in a resort in Louisiana. She came in and she put her hand on my left shoulder and she said, Craig, this is Karen. I'm your wife. It's going to be okay. And she said, you know, Craig, I said those exact words to you when you were in your coma. And so the thing that hit me was while the doctors were speaking, you know, just terrifying words of death and despair, my wife was speaking words of life and hope. And it reminds me of a Maya Angelou quote that goes, people will forget what you said. They will forget what you do, but they will never forget how you made them feel.

And why?

The doctors made me feel one way and my wife made me feel a different way and impacted my trust in both of them in opposite directions. And so, that's what we really believe that first-time offer does. And we've been doing these for over 5 years before I even went in the hospital, but it really clicked for me as I was processing what happened. That's the power. In a very short period of time, you can radically change the level of trust that somebody has in you. And the key is to be like my wife and speak words of life and hope. It makes a wonderful difference.

Very interesting. So, we talked about first-time offer in commercial terms, Craig Andrews there in Austin, Texas. But it sounds as though underlying the FTO is an emotional offer to their client. Is that what you're saying there?

Oh, absolutely. It's, you know, my view of branding, Jim, is that your brand is the emotions that people feel when they see your logo or hear your name. And so, what you're doing in the delivery of your first-time offer is you're actually branding yourself. You're doing it subconsciously. It's not that you have banners flashing across the screen, but what you're doing is you're communicating to them that you're the type of person that they can trust, the type of person that's going to help them solve problems in their life and help them achieve their goals.

Craig, you, you talked about first-time offers being, you know, complex, and there are presumably some first-time offers that are simple where you're building trust, you know, wanting to be, uh, that trusted advisor or providing something that someone will, will kind of incrementally invest in your services. Can you give us some examples of those early first-time offers that people can, can almost train with? Because some of the offers that we see online that some of the big American companies or gurus talk about make— certainly make me feel quite nervous because it feels like I'm sort of giving away so much I could almost, you know, bankrupt myself if the lifetime value actually doesn't materialize. Craig, with Allies for Me, I know you help entrepreneurs build first-time offers. So can you give us maybe one or two flavors of FTOs that you get people started with?

Yeah, so for somebody who's interested in doing a first-time offer with us, We start off with a mini project that's a first-time offer in itself. We call it FTO Squared. And there are 5 deliverables. We help somebody. We build a persona around a real person and we develop the transformation language, how they transform people's lives. Because we always believe you should sell the transformation, not the product or service. And so, that's the first deliverable. We give them kind of a messaging structure. The second deliverable is we subdivide their services into small bites and we map it into what we call the pain-gain-time grid. And kind of the short concept of that is If you're selling, you can take anything you sell and put it in one of 4 quadrants. The hardest quadrant to sell is future gain, which, by the way, is marketing. If you're selling marketing, you're selling future gain. You're selling the hardest thing there is to sell. The easiest quadrant to sell in is the removal of immediate pain. Well, the reality is every business has some ways that they can remove immediate pain from somebody's life. And so, we start mapping those into the 4 quadrants so they can start identifying The things they do for people that remove immediate pain—that's the second deliverable. The third deliverable is a what we call FTO speed delivery index. You know, and so one of the things that we see, especially with people that have high-ticket offers, is if they were to offer a first-time offer, which is an impulse purchase, isn't something that people have to think about. They have to go to accounting. I had somebody tell me that recently. Oh yeah, we we ask accounting for an invoice. And what we find is you really need to be able to deliver it quickly and possibly while you're on the phone. And so, we benchmark what they have in place and we give recommendations on infrastructure that will help them speed up their delivery. That's the third deliverable. The fourth deliverable is people worry about erosion of value that people would perceive them as low value or desperate. We've never run into that. And so, the 4th deliverable is how they can position their first-time value offer to be viewed as valuable. And we give them a breakdown how they can do that with specific recommendations for them. And then, the final deliverable is a first-time offer sales playbook because your traditional sales playbook probably won't work with first-time offers. And so, we have a proven playbook that sells FTOs like butter. And we put that in there with also some specific recommendations for them. So, right there are 5 deliverables. We do that for under $500.

Wow, Craig. And I think that you've got a special bonus we're going to come on to at the end of the show, aren't we, that you've got for the fellow Unnoticed Entrepreneur listeners. around that framework. So that'll be fantastic. Craig, thank you for articulating that. Very, very interesting. I love how granular you've made that as well. Craig, first-time offers that fail. Can you give us maybe an example of a first-time offer, not necessarily that you've offered, but that you've seen that has really flopped and that really gives us sort of a warning of what we should avoid putting into our first-time offer?

Well, there are 2 things that will make first-time offer— 2 big things that will make first-time offer fail. One is if you're trying to speak to a pain you know your prospect has but your prospect doesn't know they have. And so, that was my first first-time offer. It was something where we would run eye-tracking analysis on somebody's website to help identify focal points. Thought it was pretty cool. Still think it's cool. Guess what? Nobody understood it. Nobody wanted it. Nobody bought it.

Yes.

We still think it's cool but it doesn't speak to an existing pain. The other barrier that I see is, and this comes in the offer construction, the biggest barrier is when people can't get out of sales mode. And I'm not being critical of people. That's the natural thing. If you have a business, you're trying to sell your products or services. But that sales mindset puts you in the wrong frame of mind to come up with a really powerful offer. So, when we're doing an in-person FTO, and this is a one-on-one workshop where we're helping people build the offer, we actually devote a couple hours in moving their mindset from selling to serving. And once we get them in a servant's mindset, the offers that come out of that are mind-blowing. And go figure, when you try to serve your customer, you make more money. But that's how it works.

That's a wonderful, wonderful point that if you go from selling to serving, somehow the universe rewards you for that, Craig. That's amazing. Craig Andrews at Allies4Me over there in Austin, Texas. As an entrepreneur yourself, what would you say has been really helping you to get noticed?

Well, we've been getting out and getting on podcasts like The Unnoticed Entrepreneur. And so, Jim, thank you for having that. That's been big. We, you know, it's funny. It's a lot of it is just going out and plotting a course, not knowing exactly where we were headed, but going in the right direction and the right general direction. And I think the bottom line is for any business to thrive, you have to build your authority. And so whether it's in podcasting or some other mechanism, find a way to build your authority. It will reward you handsomely.

Craig Andrews, you demonstrated your authority on the first-time offer expertise. I'm very, very grateful to you for really demystifying something that in some books, it sort of sounds so amazing it can't be true. And you've really, by especially your 5 Framework, given me a sense of how it could be done from a practical point of view. If my fellow unnoticed entrepreneurs would like to get in touch with you, and I think you've got a special offer for us. So, that's great, Craig. Do you want to just share that with us?

Yeah. So, when we built our first first-time offer, it failed. The second one failed. The third one failed, just not as bad. And it took like 18 months to just start getting something to work. And we've kind of refined it over the last 5 years. And I've put together a guide to help your listeners avoid many of the mistakes that I made. And not only that, but we also have a course, a self-paced course where we'll give your listeners 23 days access. And the reason we're giving 23 days access, we're not trying to be stingy. We study human behavior and we know if there's not a time limit, you won't take the course. It will not change your life. We want to see your lives So, if they go to allies4me.com, that's A-L-L-I-E-S, the number 4, M-E dot com, and then add a /unnoticedentrepreneur, all lowercase, all one word, they'll take them to a page where they can sign up for those gifts and they'll get them right away.

Craig Andrews, that's very generous. Thank you. Very, very flattered that the show warrants its own URL as well. Thank you so much for doing that. Craig, so I think people can find you also on LinkedIn, can they, if they want to reach you? Where else can they get you?

LinkedIn's probably the best place. I hang out on some of the other socials, but just far less.

Okay. And that's Craig Andrews Allies for Me, I guess.

Yeah. If you search on Craig Andrews, I think I'm— I forgot the URL, but I think it is the LinkedIn/Craig Andrews. Look for the picture. I have a I have like a noticeable scar through my lip from my little ordeal in the, uh, in the hospital. And so if you see somebody with a goatee and a little slash through their lip, that's probably me.

Well, but he's also a handsome fella, Craig Andrews, so don't be put off by that. No scarring at all. Craig Andrews, thank you so much for joining me and sharing your amazing knowledge about FTOs. And my fellow unnoticed entrepreneurs, I'm sure, will be super grateful. Thank you.

Jim, this has been a delight. Thank you for having me.

Well, thank you for coming. So we've had a mixture of some personal and some professional, and really the professional, as you can see, is grounded in Craig's personal experiences. So, you know, really heartfelt, but also, you know, really authentic, but also being validated. So I hope you've enjoyed this as much as I have done. And if you have, please do share with a fellow unnoticed entrepreneur. And do, if you have a chance, rate the show. It really helps me to know that you're there and you're listening. And until we meet again, encourage you to keep on communicating. And thank you once again for listening.