MBA1573 Guest Teacher – Rob Ristagno – How to Find New Revenue in Old Data

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Hey, folks, I'm Robert Stagno, and thank you for joining us today. In this lesson, I'll be teaching you how to find new revenue new in old data. So let's get down to business. There is a lot of data out there, and this data has the potential to help us make better business decisions and better personal decisions. But 73% of this data never gets used. Almost 3/4 wasted. Maybe this is because we don't realize how much data we actually have. Or perhaps it's because we're just simply overwhelmed with the quantity of data you know, we have. Sales data, transactional data, financial data, product data, inventory data, website data, email data, social media data, CRMs, ERPs, ESPs, OMG, TMI. We are spending so much time in our data that we're not spending enough time on our data. Today I want us all to take a giant step back and ask ourselves one transformational question. In all this data, what exactly are we looking for? Let me introduce you to Jeff Luno. It's 2012 and the Houston Astros for Major League Baseball hire him to replace Ed Wade as general manager. The Astros are in a tough space. They just lost 106 games, the worst record in club history. Jeff knows he has to do something different than his predecessor. The problem is he has to compete with teams that have much bigger budgets than he has. The Dodgers, the Yankees, and so forth. All these big market teams can outbid Jeff for any good free agent on the market. You can probably relate to this, right? It seems like he doesn't have a chance. It's kind of like us as entrepreneurs. We have limited budgets and we're trying to go after these 800 pound gorillas. Jeff thought about how he could turn this organization around on a limited budget. One day, Jeff goes to a meeting and sees a presentation from a guy from Trackman. Trackman is a radar gun on steroids. Not only does it tell you the speed of a pitch, but every other physical property about it. Trajectory, curvature, how much it's bending, what direction it's spinning, in precise location, it collects 24,000 data points per second. Now that is a lot of data. So this gentleman from Trackman goes on to make a bold claim. Traditional wisdom is to sign the fastest fastball pitcher out there. But our data shows that there is an undervalued asset curveball pitchers who can spin the ball at an extraordinarily high spin rate. Most people in the room were thinking, who the heck is this data geek and why should I believe him? I've been in the sport for 40 years. Of course I know the speed on a fastball is the metric I need to focus on. But not Jeff. He saw an opportunity, he went out and got a trackman, started collecting data, hired someone from NASA to crunch the numbers, and he proved it out in the numbers. Yes, it is true. So while all the other teams were fighting with the Yankees and Dodgers to sign the elite fastball pitchers, Jeff quietly stockpiled high spin rate curveball pitchers. The Astros go on to win their first World Series. And analysts credit the use of curveball pitchers to compete and win effectively. Now, as a sidebar, if you're a baseball fan, you probably know that unfortunately there's a cheating scandal going on now where the Astros hitters and their bench coach stole signs illegally, which has tainted this victory. But it shouldn't take away from the achievement of Jeff and their pitching staff, which was stocked with elite curveball artists. And we're not the ones cheating. What can we learn from the Astros beyond Don't use data unethically or it will mar your otherwise impressive accomplishments. Jeff and the team found their spin. We call the spin. It's a simple insight validated by data that no one else is paying attention to. Spin comes from asking good questions, then using data to validate a simple insight. Leaders who can find and use their spin create predictably positive revenue acceleration. Now I have a confession to make. It was me that was the data geek from Trackman who presented to Jeff. Ever since we discovered that spin rate insight, I've been Passionate about helping companies discover their spin to improve their business results, we found literally dozens of ways to discover spin and drive near term sales enhancements. Today, we're going to walk you through one specific way that you can implement at no cost and leave you with a five step process to go out and do it all for yourself. And it all begins with whales. Yes, whales. Whales are your most engaged, enthusiastic and excited customers. This concept of whales was discovered by other industries such as the casinos. Just a fraction of 1% of gamblers generate a majority of the profits for casinos. These are the high stakes baccarat players. Actually, some casinos pay as much as $5 million to client relationship managers to go out and find these high rolling baccarat players and get them to come to their casino and mobile gaming. It's a $35 billion industry, but 30% of gamers only play the free version. Kind of like me, but it's okay because the top 20% generate 88% of that $35 billion. And the top 1%, 21%. Why are whales so important? Now, we've done a lot of research on this and found that whales not only generate a disproportionate amount of the revenues, there are lots of other advantages. They're less price sensitive, whale more profitable, they buy more often, they help you innovate and they provide word of mouth marketing. It's like a free referral engine. Data can help you figure out who the whales are in your target market if you ask the right questions. The key principle is segmentation. To find our whales, we have to stop taking a one size fits all approach. Segmentation can help you increase lead quality, get more customers faster, use better online channels, more effectively to scale your company and maximize customer lifetime value. In our experience, we've seen a segmented approach lead to sales, marketing and product development enhancements resulting in double or even triple digit growth. And it's not uncommon for us to see a company increase their sales by three, five or even ten fold. We've developed some very advanced and sophisticated models using data science to help companies segment their customer base using their data. However, we always recommend starting with this simple approach that anyone can do. I'm going to share this approach with you and again, it costs nothing to implement besides a little bit of your time. We'll walk through this together, but if you'd like a handout so you can distribute this to your team, please drop me a note@whalesterlingwoods.com and I'll send you a copy. All right. Are you Ready to begin five steps. Step one. Close your eyes. Unless you're driving, imagine one of your whales. Who do you think your whales are? Imagine one. Just pick one of them. Do you have the vision? Great. Now physically draw him or her on a piece of paper. That's right. Don't worry, no one's gonna see it besides you. Press pause. Sketch out the image in your mind. Great. You got the image. Step 2. Go back to your drawing and write out a verbal description of your whale. Focus more on attitudes and behaviors rather than demographics. Stay away from things like age or gender. Instead, ask yourself questions like what do they do for a living? What hobbies do they have? What are their aspirations? What's most important to them? Where do they hang out, online and offline? What problems do they have when it comes to your industry or product? What fears do they have when it comes to your industry or product? Why do they love you? How do you help them solve these problems and overcome their uncertainties? What tangible benefits do they value that you provide or could provide? Same thing with emotional benefits. What do they value and what can you provide? Pause the podcast now and jot some of these answers down. Step three. Now go out and talk to five to seven of your whales. Ask them these same questions and see how their responses compare to yours. Now the insights will come from where there are differences. Your job is not to confirm that you were right, but rather to see what you might have missed. Step 4. Send out a survey to your entire customer list to validate what you heard in these five to seven interviews and also to spot your whales. You can use something like Google Surveys to do it for free. You might ask what goes into the survey. Just list some of these pain points that you heard. Ask the respondents to agree or disagree with them. Then list some tangible and emotional benefits, Ask them to rank their importance to them, analyze your data and move on to step five. Activate the segmentation. This is not just an academic exercise. Now that you have a richer understanding of who your whales are, what you need to go out to get for them, how you going to give it to them? You can come up with a plan, an action plan, a go to market strategy where you can talk about changes to your sales process, changes to your marketing activities, enhancements to your product, potentially launching new products. What do you need to do from a customer service or customer experience standpoint to retain your whales and turn them into brand advocates so you get free referrals? It probably makes sense to include your team in this process. So again, if you Want the handout? Please shoot me a note at whales@sterlingwoods.com and I'll send you one. So to recap, using segmentation to find your whales is just one example of discovering spin. And remember, spin is a simple insight validated by data that no one else is paying attention to. If you focus on your whales, you'll be treating them unlike your competitors and have a definitive advantage and will grow your revenue as a result. I'm confident you can go out and find your spin. You have more data than you realize and we just walk through a simple process to go out and collect even more data that can dramatically improve your revenues. All right, everyone, this was Robert Stagno. If you want to continue learning how to find new revenue in old data, Visit us at sterlingwoods.com or shoot me an email at walesterlingwoods.com thanks again for joining us today.

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I absolutely loved today's guest DJI Robert Stagnant. It was amazing to hear his story, how he came up with this strategy through his own experience. And I love the fact he gave us specific steps to take to get started focusing in on those whales, those power users, those people that absolutely love you. These people are gold. You need to leverage their experience and their willingness to share their experience with others. They're also the people that are most likely to buy from you again. So if you launch a new product or service, they're the first people that need the least amount of convincing. They're also the people that can be your evangelist to promote that new thing. And that new thing doesn't have to be a whole new product. It can be an improvement upon your product. It could be a improvement in your service or maybe you're offering free shipping or whatever it is. But to get started, you need to know who these people are. You need to collect that data. You have to understand who they are. You have to actually go and get that data, whether that's just going to your payments dashboard or seeing who has frequented your site the most. This is worth your time. If you want to learn more about today's topic, just go to sterlingwoods.com and dig in. Thank you so much for listening to the 100 RMBA show. If you love it, you hear Hit subscribe right now. So when the next episode, which is tomorrow, gets released, it gets downloaded right to your device automatically. Also, by hitting subscribe you get access to our archives. Over 1500 business lessons. It's the only way to get access. So hit subscribe right now and whatever you use to listen to podcasts. Before I go, I want to leave you with this. Some of us, we don't collect any data. Most of us have a lot of data, but we're not tapping into it. Some of us just get overwhelmed. Start with something. Start by identifying your power users, your whales. As you get into the data, you'll start to realize, hey, there's more information here that I can use. There's more information that I can actually leverage and use to tap into other ways of marketing. Look at the tools you use to run your business. Whether it's your customer service software, email marketing software, your actual website. There might be some data there that you are privy to, but you just haven't seen. For example, we use Intercom for our customer service and Intercom actually can tell you how large your user social media following is because their emails often attach to their social media handle. So you can quickly find out, hey, we have a ton of users with over 10,000 followers on social. Maybe I reach out to them and get them to join my affiliate program. This would not even happen if I didn't know I had this data. So information is gold. So you can start thinking of ways to grow your business. Thank you so much for listening and I'll check you in tomorrow's episode. I'll see you then. Take care. Of.

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