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Speaker1: ...youbringsomebodyinnewandyoutellthemthemainthrustis,you'vegottodothemarketing,andthenintheeveningweteach,wehavenoproblem.Theydoit.It'stheonesthathavebeenthereforagoodwhilethatarekindofsetintheirwaysthatarelittlelazyanddoingthosethings.So,youeitherhavetoactuallygowiththemtodoit,orwhatIdid,Igottiredofmessingwiththem,Ijusthiredonepersontodothat.Anditwasoneofourblackbeltmoms.

She'saround40yearsold.Shehastwokidsthatarebothblackbelts.So,whatagreattestimonialsheis.Oneofherkidsisoneofourassistantinstructorsat15.HerjobisIgiveherthelisteachdayofwhatshehastodoinmarketing,andhergoalistohitacertainnumber.Wehavetohaveacertainnumberofleads.Wehavetohaveacertainnumberofappointments,acertainnumberofenrollments,andthat'sallbasedonherdoingherjobthatI'mliningoutfor.

NowIhavetopointherintherightdirection.Ihavetotalktoheronadailybasistoseewhatshedid,becauseifyouleavepeopleouttheretodothatandyoudon'tfollowuponit,itdoesn'tgetdone.Butwhentheyknowyou'recheckingwiththem,thenthey'regonnagodothesethings.Everyday,howsuccessfulyourmarketinggonnabeifeverydaysomebody'souttheredoingallofthisstuffthatneedstobedoneduringthedaytime?

Nowthat'sourexternalmarketing.Thenwehaveaninternalmarketingthatwedoduringbusinesshoursthathastobedoneattheschool.You'reactuallymarketingallthetime,becausewe'reeithermarketingfornewenrollmentsorwe'remarketingforwhat?Upgrades.Now,guys,Idon'tknowaboutyou,butI'dmuchratherhavearenewalthananenrollment.Butwecan'thavearenewalwithoutanenrollment.Weknowthatanenrollmentiswortharound3grand,whereasanupgradeonepersoniswortharound15to20grand.Afamilyisworthabout40.So,howimportantisafamilyifwecangetthem...

Speaker2: Bytheway,asanaside,doesthatnumberboggleanybody'smind?

Audience: Yes.

Speaker2: So,yougottogetoverthat,right?Yougottogetoverthat,becauseififyou'refishingintherightpond,bringingqualitypeopleinisthere'snoreasontheywon'tpay$500amonth.Extrapolatethatoutsothey'regonnabewithyoutoblackbelt,seconddegreeblackbelt,howmuchdoesthatendupbeing,right?Ifit's300amonth,3,600ayearforfiveyears,what'sthat18,000?Right?It'snothardtogettothosenumbersandit'snothardtogettheoneswhorenewtobeveryvaluable.Theonesthatdon'trenew,it'sharder.

Again,gobacktoPenny'squestionearlier,we'vefollowedthenumbers.Weactuallygotintoanargument,oneofthemeans,aboutthreemeansago,butIfollowthenumbersextensively.Oncewegetsomebodyrenewed,thedropoutrategoestoaboutone-thirdof1%,whereitwas4or5%percentbeforeso...

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Speaker1: I'veseenitinyourschool.

Speaker2: Yeah.

Speaker1: Thatfamilyofthreeandfour,oneofthethingsthatIhadalittletroublewhenIfirstjoinedforceswithMasterOliverandstarteddoingexactlyeverythinghewasdoingexactlythewayweweredoing,wekindof...

Speaker2: Talkingaboutconvertingadinosaur.

Speaker1: Numberonewasrotatingcurriculum.Please.Iwasstuckonthattraditionalstyleof,youhavetoteachagreenbelt-greenbeltstuffandabluebelt-bluebeltstuff.So,ittookmeawhile.EventhoughI'dseenalotofmyfriendstoconvertover...

Speaker2: Ittooktwoyearstowanttounderstandit.

Speaker1: It'stheoldexpression,"Ifitisn'tbroke,don'tfixit."ThenIdecidedthatitwasn'tbroke,butthere'sabetterway.

Speaker2: Wouldyouevergoback?

Speaker1: No.OnceIdidit,andIheardpeopletellme,thatonceyoudoit,youwon'tgoback,butonceyoudo,youwon't.Andyou'llbegladyoudiditquickly.Therealkeythereis,ifyouhaveyourstudentsgoingthroughthecyclesoftheupgradeandyou'vegotonestudent,yougetafamilyoftwo,andinMasterOliver'sschools,iftwopeoplesignup,therestofthefamilyisfree.Icouldnevercomprehendthat,andIwasgoing,"Well..."Thenwegotfivepeople.Well,theadvantageoffivepeopleisnow,thosetwopeople...

Speaker2: WebothstoleitfromBillClark.[crosstalk00:04:47]

Speaker1: Thosetwopeoplearepaying595amonthforafamilyplanfortwopeople.So,fivepeople,theypay,dothemathquick.Fivepeoplepay.

Audience: Therestarefree,right?

Speaker1: Sayitagain.

Audience: 595[inaudible00:05:03].

Speaker1: Hey,now,insteadof595fortwo,whichnowthey'repayingoutby300amonth,thefamiliesareeasytoupgrade.So,allwegottodoisgetthemonthatbasicprogram,gettwointhere,thenwhenwegotoupgradethem,"Momanddad,you'refree,anyway."

Speaker2: We'renowonamassivetangent.So,let'strytohoneusbackintoourdirectionhere.Themarketingprinciple,bytheway,andwe'rereallygonnatrytostayonimprovevalue,butgetthefloodofpeoplein,andthemissionisahundrednewpeopleinsix



weekswhenyougoback,right?Theprinciplebythewayhereis,anawfullotofschools,mostschoolsdoahorriblejoboffamilyadd-onsaswell,right?

Intargetingthekidsmarket,wefindthatbetween50and60%ofthekids,wecangetoneorbothparentsintheclass.Ofthose,it'sabout80%moms.Okay?Nowyoucan'tdothatwithmomcomesTuesday,Thursdayat8:00p.m.andandBillycomesMonday,Wednesdayat6:15,andSuzy,theyoungersister,comesinWednesdayFridayat5:00.See,becauseyourbiggestobjectionofallofyourstudentswhoareproperlyqualified,you'vegottowritethisdown,becauseit'simportant,thebiggestobjectionyouhave,enrollmentorrenewal,isnotmoney.It'stime.

ThebiggestprobleminU.S.,Australia,NewZealand,well,alotofsheeptenderstill,butwe'llpassitonthegrunt.Thebiggestproblemisthey'rebusy,andespeciallyifyoudrawthemformuchofaradius,alotofyourareashavealotoftraffic,right?So,momisnotgoingtositintrafficsixdaysaweeksothatsheandthetwokidscancometoclass,butiftheyallcomedowntogether,you'refine.Imagineifyougofromonaverageenrollingonepersoninthefamilytoonaveragehavingthreepeopleinthefamily.Whatadifferencethatmakesinelevatingit.

Again,thethingthatwe'reveryfocusedoniswhetherwehaveoneortwokids,wewantmomtobeintherewithher,withthem,right?Again,80%ofthedecisionismom.Ifmomisinclasswiththekids,arethekidsgonnadropout?No.Aretheygonnabeeasytorenew?Yes.So,it'saveryimportantconsideration.Andagain,we'vegotwe'vegotyouknowmorefemaleschoolownersinthisproperty,probablyrepresentedintheindustryasawhole,althoughit'schangingdramatically.Butforalltheguys,mostofyourmarketingistowomen.

Don'tassumethatyou'vegotthedealdown,right,isyou'vegottorealizethat,forthekids,you'remarketingtomom.Obviously,fortheadultwomen,you'remarketingtothewomen.Evenforsomeoftheguys,you'remarketingtothewifeorgirlfriendaswellastohim.So,you'vegottogetgoodatthat.IfyoulookifyoulookatmajorcompanieslikeKiaorCadillac,that'sbeentheirturnaround.Yes,allthecarcompaniesweredominatedbymenwhowereintheir60s,andtheyweremarketingtomenlikethem,andfallingflatontheirface.

Cadillacgotayounggalinthereastheheadofmarketingwho'sdoingafabulousjobmarketingCadillacstowomen,becausethat'swhoismakingthebuyingdecisionanyway,right?Bythewaythere'sonlyonecarofthePantheonwherethewomanhasessentiallyzeropercentinput.Doyouknowwhatthatisstatisticallybythestudies?Porsche911.It's100%maledecision,almost100%percent,becauseI'vedrivenabunchofPorsches.Ithinkit'sentertaining.What'sthat?

Audience: [inaudible00:08:51].

Speaker2: Yeah.Absolutely.Absolutely.Anyway,let'sgobacktodirectmailherebecauseitissomethingyou'vegottogetreallygoodat.Myguessis,hardlyanybodyintheroomisdoingagoodjobatit.Isthatafairassumption?Okay.Thewayyougetgoodatit,in



part,isyougetcomfortablewithspendingalotmoremoneyperleadthanyou'recomfortablewithnoworthatyou'recomfortablewithevenafterIwalkyouthroughthenumbersrationally.Emotionally,you'vegottogetdetachedfrombeingfreakedoutaboutthat.Doesthatmakesense?

Overall,fromastandpointofimprovingyournetprofit,andmostofthebigschoolswhenI'velookedatyourP&Lfitinthiscategory,justabouteverybodyinthisindustrymakethesemistakes.Theyspendtoomuchmoneyonrent,whichbytheway,ifyougotrentlike...ifyougotalocationlikeChrisoverherewherehe'snexttotheCostcoandtheycomefloodingin,that'smarketingexpense.Okay?That'sokay.ButmostpeoplespendtoomuchmoneyonrentinpartbecauseweallwanttobuildaTajMahalforourselves.Right?

Weendupwiththisbigelaboratefacilitythatisn'tfacilitatingwhatwewanttoaccomplish.Again,ifyou'renexttoChuckE.Cheese,moneywellspent,probably.Ifyou'renexttoCostco,moneywellspent,probably.Butifit'snotcreatingaflowoftraffic,it'sjustsquarefootage,right?Again,oneofthemostprofitableschoolsI'veeverseenwasinthebasementunderneathacoffeeshop.Literally,youwalkedinthehallwaytogotothecoffeeshopandtherewasadooroverthere,andyouwereinthebasement.Hehadkids,[Kathner00:10:36].Hehad8,000squarefeet,butitwascheaprent.Theresultswashismarketing.

Thesecondthingthatmostbigschoolsmakeamistakeofistheyhavetoomanypeopleonpayrollandtoofewgoodones.Youendupwithawholebunchofduncesrunningaround.Idon'tmeanthattooharshly.Youendupwithawholebunchofreallyskilledmartialartistswhoaren'toutbeatingthebushesfornewstudents,aren'tgreatatmakingthesale,andperhapsaren'teventhesuperstarinstructorthateverybodygravitatesto.Right?

Speaker1: Youhavetohave...

Speaker2: You'llneedtoturnitoffjust...

Speaker1: Iwaswaitingfortheredlighttoturngreen.

Speaker2: Okay.

Speaker1: Youneedtohavethestaffthataregeneratinggross.Theproblemismostschoolshavestaffthatthinktheirjobisjusttoteachthetheclass.Andthey'renotsellingtheprogramintheclass.Youhavetorealizethatjustlikeafirstintro,itissellingtheprogram.Wedon'tselltheprogramfromtheofficetogetthemtosignup.Everythingisdoneinthefirstorsecondclass,andatworstcasescenariothethirdclass.They'realreadysoldwhentheywalkin.Wejustgottoshowthemwhatkindofpaymentplantheywanttodoiton.Thathastobethething.

Well,that'sthesameprocesswiththeenrollment,withtherenewal,ortheupgrade.So,ifyourstaffthatyouhaveouttherearenotfacilitatingthatandthey'renottargeting



thosepeoplethatyouwanttoupgrade,thenthey'rejustteachingclasses.Andthat'sworthjustanhourlyjob.That'snotworthanybodygettingabasesalaryorcommissionoranythinglikethat.

Audience: Forsomeonelikeme,I'veonlybeenopenedayearandahalf,wheredoIgetstaff?Myhighestrankingbeltisnineyearsold.

Speaker2: Right.Right.

Audience: It'slikeIknowIabsolutelyneedtodevelop,but...

Speaker2: Well,it'samoreexpansivetopicthatwecangogoovertomorrow,butanawfullotofwhatwe'retalkingaboutdoesn'tneedtobeamartialartist,right?Wehadseveralinseries,noneofwhomhadtakenadayofmartialartsclassintheirlife,asIrecall.

Audience: [crosstalk00:12:45]

Speaker2: Yeah,wecouldtellherstorytoo.OneofthemIhadhiredfromamajortextbookpublisher.Hisjobhadbeentogointomiddleschoolsandhighschoolsandselltheparentsonthiselaborateseriesofbooksandvideos.Ihiredhimstraightfromthemandputhimintohandlingforsixlocations.Wehadabout20elementaryschoolsperlocationthatwewereworkingon,plusmaybefivemiddleschools.So,hehad25schoolsperlocationtimessix,andhisjobwasonlyandexclusively40hoursaweektoworkwiththeelementaryschools.Hewouldrotateinasixweekcyclebetweenourlocations.

So,alotofthosekindofroles,marketingperson,salesperson,andsoforth,youdon'tneedthat.Theothersobviouslyshouldbedevelopingfromwithin.Again,it'salongertopicthatyougettotomorrow,wecandoitonateleconference,butyoucandoanacceleratedtrainingprocesstorampupinstructorsaswell.Weforyearswhenweneededitwererunningasix-weekacceleratedtrainingprogramwherewecouldrampupinstructorsinsixweeksratherthaninfiveorsixyears.AndIcanwalkyouthroughthat.Fred,youdidquiteabitofthat.

Fred: Yeah.[inaudible00:14:00].

Speaker2: Exactly.

Fred: Wedidthreemonthsasfarasthetraining.

Speaker2: Yeah.ItalwaysannoyedmebecausewewenttoaeducationalfundingcompanyconventionandIcreatedtheideaandyougetthedamnaward,becauseIwasnotpoliticallycorrectenough.

Fred: [crosstalk00:14:13]

Speaker2: Isthatit?Okay.



Audience: Hediditbetter.

Speaker2: Wecanargueaboutthat,butit'sirrelevant.Yes?

Audience: Doyouchargethemforthatprogram?

Speaker2: Let'sgetintothattomorrow,ifatall.


Speaker2: Theanswertheansweris,yes,no,andmaybe.Thereareseveraldifferenttracksyoucanrunonsomethinglikethatanddothat.TheCarrollstory,youmeanfindingtheguy.Didheworkout?

Audience: Well,notsofar.

Speaker2: Notsofar.

Audience: Hedidn'tcomewhenhehadanappointment.

Speaker2: Okay.

Audience: Itturnsouthe'shomeless,butsowhat?Buthemightcome.

Speaker2: Yeah.

Audience: That'sthestory.

Speaker2: Wewon'ttellthatstory.

Audience: Straightoncommissionandhowdoyoustructuresomethinglikethatwhenyou'renotinyourschoolto...

Speaker1: Let'sdoitonabreakorsomething.

Speaker2: Wait,wait,wait.Wait.They'renotinyourschooltobeavolunteer?

Audience: Right.

Speaker2: Youpaythem.Youpaythem.

Audience: Okay.

Speaker2: Butwe'llmovethistotomorrow,sowecanstayontrack.

Speaker1: Wetrytogetonthemarketingtopicsince...



Speaker2: Yeah.

Speaker1: AndI'mtheonewho'sgettingofftopic.

Speaker2: Yeah,nokidding.Butbringitin.Allthatiseasilysolved.Okay?

Audience: I'mnotsurewhatthelabelhasstated.Doyouguyshaveanyidea?

Speaker2: No,no,no.Theinsidejokeis,whenwetookoverthecompany,wehadavideolibrarythat'sprobablyfromwherethosewallsareacrosstheroom,what,thousandsofhoursofstuff,right?Ifyouthengothroughthelibrary,whichispartofthereasonIwantedtopurchasethecompanyfromCentury,yougothroughthelibrary,inmostgeneralterms,thevideolibraryfromabusinessstandpoint,marketingsales,highlevelbusinessstuff,wasmostlybetweencrapandtotalcrap.Ontheotherhand,thelibraryfromthestandpointofhigh-levelmartialartiststeachinghigh-levelmartialartsstuff,there'salotofgreatstuff,alotofgoodteachingstuff.

Fromthestandpointofus,top1%ortop5%,lookingatthevideocontent,itwaskindoflike,"Let'sjustsetafiretoallthatstuffandgiveup."Right?Isthatafairstatement,Toby?

Toby: Yeah.

Speaker2: Slightly,probablyunderstated.Nowwehavehundredsofhoursofmeandhim,andTobyandMerrickaretheoneswhoaregoingthroughtherawfootagegoing,"Whatthehellwasthattopic?"Becausehedid10minutesonthis,thenwentoverhere,andit'sthe15minutesonhere,andhe'satthebehindthescenesgoing,"Well,Igotatranscript.DoIcutitintothreepiecesandmakeatenshorts,ordoIlikemakeupatopicandhopethattheyfigureitoutwhentheywatchit?"

Toby: Becauseifsomebodyhasaquestion,thenwhat's[crosstalk00:17:10]...

Speaker2: That'scompletelyoff-topicandunrelatedtodirectmail.

Speaker1: Youhavetocutthemoff,butatleastkeepthemintopic.Wegotatleast,whentheyraisedtheirhandonceinawhile,whenthey'vehaditforalongtime,andtheyhave,"Doyouhavetogothebathroomoryouhaveaquestion?"

Audience: Markisgettingtired.

Speaker1: Goahead.

Speaker2: Mago?

Mago: What'snumberthreeofthebigmistakeswe'renotspendingenoughonmarketing?



Speaker2: Yes.Ididn'tfinishnumbertwo,actually.Numbertwoiswhichishowwegotoffonallthisstuff.

Speaker1: That'sit.Thanksforbringingusbackontopic.

Mago: Noproblem.

Speaker2: Numbertwo,whichishowwegotoffonthisstuff,ishavingtoomuchheadcount,oftoomanytechnicalmartialartstypes,andtoofewreallygoodpeoplewhoaregettingcompensatedhighly.See,ifyouhavesomebodywho'sagym,theirretentionisfabulous,theirrenewalrateisfabulousonthefloor,orthey'reoutbeatingthebushesallthetime,andyou'redrinkingfromafirehose.Theyshouldbemakingalotofmoney.Theyshouldbemakingyouknowplusorminus20%,anyotheropportunity.I'dratherbe20%betterthantheotheropportunity.

You'reluckyifyoukeepthemforacoupleyearsanyway.Muchless,you'retryingtodotheoldstupidmartialartsthingofgettingthemtovolunteeranddoitbecausetheylikeyou,andtheylovethething,becausethatreallydoesn'tlastverylong.Right?Theyshouldbemakingplusorminustheirotheropportunities.Ontheotherhand,iftheyknowyourmovesandtheforms,andtheycanteachtochokeorthekickandstuff,well,it'snothardandit'snotaveryvaluableposition.

That'snumbernumbertwo,ishavingtoomanypeoplewhoaren'tverygood,theMMAchangeintheindustrythat'sbeendetrimentalispeoplegoingbacktothefitnesscentermodelandnowtheygottenpart-timeinstructors.Allofasudden,youhaveallthesepeoplerunningaroundwhoaren'tgettingfourorfivehoursaweekofstafftraining,whoaren'theldaccountableforretentionratesandrenewalrates,whocouldgivearat'sasswhatthegrossisoftheschool.That'sjustdeath.Right?

Inyourcase,sinceyou'vegotawholebunchofdanceinstructors,youcouldcareless,buttheycomeinandtheyteachtheirlittlepirouetteandstuff,andtheythinkthatthat'sthedeal.Right?Crystalhasthesameproblem.AllthesedifferentMuayThaiguysandthey'rerealtough,roughandnasty,andsoforth,butnoneofthemareheldaccountableforthething.Inmanycasesthey'remaking200,000ayeardoingsomethingelseandthereisahobby.Youcan'tbuildarealbusinessaroundthat.Right?

Inthefitnessmodel,you'dhave22aerobicsclasses.Iusedtomanagethefitnesscenter,22aerobicsclasses,doesn'tmatter,isyouhave10differentinstructorsandeverybodycomestoSuzy'sclassandnobodycomestotoJohn'sclass,andyoutrytoreplaceJohnandgetanotherone.Butinourmodel,thatjustdoesn'tworkverywell,becausethevalueperstudentisnothighifthey'renotaccountableforretentionandrenewals,andsoforth.

Thethirdthingisunderspendingyourmarketing,andyou'reexactlyright.Yeah,we'redowntonumberthree.Themainthingaboutthatis,youwanttonotbethinkingaboutyou'retryingtorifleshotoryou'retryingtogetonamegaphoneandgetpeopletopayattentioninthecacophonyofthedailylife.Whatyou'relookingforissomebodywho's



raisedtheirhandalittlebit,who'sexpressedsomelevelofinterest.Thenyoudomassiveefforttogetthempulledin.Youcangothroughwithdirectmailtodolead-gen.

We'regonnadoitfor[NAPNA00:20:44].Theindustryis15,000schools.We'regonnarakeacrosstheindustryagainwithleadgenerationstuffjusttogetthemtoraisetheirhand.Ontheotherhand,wehaveabout1,600schoolsthathaveraisedtheirhandalittlebit.We'regonnaspend20timesperpersononthosethanwewillontheothers.Onegroup,we'rewillingtospendabuckfifty;theotherwe'rewillingtospend$28.Right?Thatgivesyouasense,right?

Mostlyyouwanttobeconstantlylookingforpeoplewhohaveexpressedalittlebitofaninterest,andbeingpartofanaffinitygroupisagreatstart.ThreeothergirlsinmyGirlScouttroopareintherealready.It'seasytogetSuzytocomejoinyouknowtheothertwogirls.Abunchofmythirdgradeclassareintherealready.It'seasytogethertocomeinanddothatbecauseshe'salreadygonnafeelcomfortable.Themoreyoucanlookataffinitygroups,onceyougetthemalittlebitinterested,spendalotoftimeandeffortonthem,you'remuchbetteroff.Right?

Ihatetosayitthisway,becauseI'mtheguruofcopywritingandallthisstufffortheindustry,butreallyit'smoreaboutsaturationbombingthanitisabouteverythingbeingperfect,becauseyou'renevergonnacraftexactlytherightmessageforeachandeveryoneofthem.Ifyoustayinfrontofthemalot,eitherwithbigfull-colorpostcardsthatgetstheirattentionorbankbag,prioritymailsquirtgun,stufflikethat,thatisreallyabigchunkofthebattle.Yes?

Audience: [inaudible00:22:20]myquestion,ithastodowithdesigningthewebsite.Wehavethreedifferentoptionsonpagesandthenwedistinguishthisflowafterthosebasebomb,whetherthey'reinterestedinthekidsorthekidsisawareoftheprogram.Doyouguysdothesamethingwithyourdirectmail?Justinthecontextofkid'sclassesyouhavespecific[crosstalk00:22:41]...

Speaker2: Yes,yes.

Speaker1: Goodpoint.

Speaker2: Yes,goodpoint.IguessIdidn'tsaythat,butabsolutely.Onceyouknowwhoandwhattheyare,issoifyouhavewomenlookingforafitnessclass,youonlywanttobeshowingthemthatstuff.I'veheardpeoplemaketheoppositeexcuse,"Well,Iputthecardiokickboxingandthekid'spictureandthisandthat,becauseshehasahusbandwhomightbeinterestedinthis.Shehaskids."No.Whatevertheyraisetheirhandthatthey'reinterestedin,Iwanttofocusonlyonthat.

Now,IfindthatSuzyisa35-year-oldmomwhohasafour-year-old.I'llworktogetthefour-year-oldin,orviceversa.IgetthechildinandI'llworktogetmomaddedon.Butallofthefollowupshouldberifleshot,right?NowI'veseensomepeopletrytomakeitbe,"I'mtargetingfour-year-olds.I'mtargetingsix-year-olds.I'mtargetingnine-year-olds."Thatmaybetoomuchbecausewhathappenis,ifyoumakeitcomplicatedyou

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don'tdoanything.Right?Arguably,youcanautomatesomeofthecomplication,butreallyyouwantarifleshotdowntothemajorsubgroupsandgetouttothemalotone.

Bytheway,aneasywaytoautomatedirectmailistoputitinarotatingcurriculum.Nowhere'swhatImeanbythat,isyouhavefourmonthsworthofpieces,let'ssay,twiceamonth,soyouhaveeightthings.InSeptemberyoudothispiece,thenthispieceOctober.Youdothispieceandthispiece,andyoujustkeeprotatingitthroughandthenstartover.Youdon'tworryaboutwhentheleadcamein,isifthey'regettingapieceofmailinOctobertheygetthis,andeverybodyinthelead.

Whatsomepeopledoistheytrytogettooanalyticandsay,"Well,I'mdoingthesequentialautoresponderthingwithemail.Theygetnumberone,numbertwo,numberthree.I'mgoingtodothesamethingwithdirectmail.Assoonasyoudothat,youpullyourhairoutandyoudonothing.Okay?Don'tdothat.Justmakeitsimple.Everybodyintheleaddatabasewho'sakidisgonnagetthispiecethismonth.Everybodywho'sanadultmalelookingforthisgetshispieceandmakeitassimpleashumanlypossible.

Audience: [inaudible00:24:52]allofthat?

Speaker2: Yeah.

Audience: Isthatthewebsiteisjustanotherlead?

Speaker2: Yeah.

Audience: [inaudible00:24:59].

Speaker2: Yeah.Don'tmissthat.There'snodamndifference.BackwhenIdidthatextraordinarymarketingprogram,atsomepointoranother,thefileoftheoriginallettergotlostthatIhadreallysweatbloodtowrite,andhaddoneallthetraumaaboutputtingittogether.ItwaslikereallythefirsttimethatIhadspentalotoftimeonthatotherthankaratelessons.Somewherealongtheline,thefilegotlost.Therewasafloodontheharddriveanditgottrashedorsomethinglikethat.

WhatIstarteddoingisjustprintingoffthewebpageandmailingthemtheprintoutofthewebpage.Itworkedjustaswell,ifnotalittlebitbetter.Itjustdidn'tmakeanydifference.Right?Theonlydifferencebetweenawebsiteandaphysicaldeliveryisjustgettinginfrontoftheminaslightlydifferentway,right?So,youcansay,"Well,Idon'tneedtodosnailmailanymore,becauseonlinevideoisgreatandIcandrivethemintoanonlinevideo,"unlessyoucan'tgetthemtoclickthelink.

Now,ImailthemaDVD.CanIgetthemtowatchtheDVD?Wehaveanintroductorypackage.It'sprettyelaborate.It's,let'ssay,40pagesofcolorprintedmaterial,anaudioCD,andaDVD.I'veheardsomefeedback.TimColbert'scommentwhenhesawitaswell,"It'sawfullyredundant."Mycommentwas,that'sexactlythewayitwasdesigned.Youknowwhy?Inmyfamily,whatwouldhappenwouldbe,ifitwasformy10-year-olddaughter,she'snow11,shewouldrunhomeandwatchtheDVDwithmom.There'sno


wayonheavenorearthyouwouldevergetmetositdownfor45minutesandwatchtheDVD.

Ifitdoesn'thavebikinibabes,helicoptersandalotofpeopledie,$100,000productionvalue,I'mnotwatchingit.Okay?You'renotgoingtogetmetowatchasalespitchonvideo.However,theCD,I'llputitinaCDplayeranddrivearoundtownandlistentoit.Youwouldnevergetmy11-year-oldandhermomtolistentothat.They'vegotDisneyChanneloninthecarandthey'regonnabelisteningtoDisneyChannel.Nowaythey'regonnalistentotalkinginthecar.

Youwouldgetmomtoreadthroughthebooklet.You'dgetmetoreadthroughthebooklet.IfyouhavethatpackageandyoujustdeliveredaDVD,I'mnevergoingtowatchit.Whatarethereasonyoudomultiplemediaistohitdifferentlearningstylesanddifferentpersonalitystyles.PartofthereasonyoumakeitredundantissothatyougetthemessageacrosswhateverpieceofitIdo.

Theotherpartofitis,ifyousendmealinktoanMP3,eventhoughI'dbewillingtopullitoutandputthethinginmycar,I'mnotgoingtodownloadittomyiPhone,hookmyiPhoneupandplaytheiPhoneinthecar,becauseI'mjustnotgoingtogotothatmucheffort.Right?You'renotgoingtogetmetodothat.TheMP3linkontheonthewebsiterightnowdoesn'treplaceanaudioCD,eventhoughmostmusicnowisshiftingtoabeingonlinedownload.Doesthatmakesense?

Webvideo,youmightgetmetowatchthatbeforeaDVD,butitdoesn'treplacemailingaDVDbecauseawholelotofpeoplewon'twatchitonline,right?Again,mydaughtershewouldn'twatchthevideoonline,butshewouldputtheDVDintotheDVDplayerinherlaboraTVinherroomandwouldwatchit,andthenshe'dhookmomin,andthey'dsitdownandwatchittogether.Right?So,you'veyou'vegottobeawareofallthosedynamicsbeforegoingtothecheapandeasysource.Right?

Speaker1: ThereasonswhyIstarteddoingtextmessaging.Somanypeopleusethatmedianow.WiththeiPhonesandalltheotherphonesthatpeoplearedoing,it'sgotvideoonit.Whenyousendthematextmessage,theycanactuallyseealivevideoandtheyseeyourcommercial.Youputwhatevercommercialyouwantonit.

Speaker2: YoucanputaYouTubelink,yeah.

Speaker1: Yeah.Youjustlinkitrightintooneofyourads.It'sthesamethingwhenyougetaninfocallattheschool.You'renotjustgoingtotalktothemaboutkidsoryou'renotgoingtotalktothemaboutadults.You'regonnafindoutwhy.That'sthesamethingthatyourleadinformationthatyouhaveshouldhavealreadydefinedforyou,soyouknowwheretoputthem.It'sthesamethingwhenyou'redoinganinfocall.Youcan'thaveonegenericinfocall.Youhavetofindoutexactlywhytheywantandthenthat'swhatyou'vegottoemphasizeonthecallandthepurposeforgettingthemin.

Speaker2: Yeah.Tore-emphasizeaminuteago,ifyouhad10hoursoftestimonialsonthelittlecamerathatcost200bucks,youcannowdoarougheditdowntoarealnicehour.Now


thatrealnicehour,youpulltheaudiotrackoffandyou'vegotaCD,youdohardcutstogether,nothingelaborating,andyou'vegotaDVD.Youdoatranscriptionofit.InfactIdoatranscriptionofall10hours.Butyoudoatranscriptionofit.YOugotapackagethatyoucangivepeopleinwriting.

Now,you'vegotthesamecontentthat'sonthewebsiteandvideo.Thesamecontentcanbeonthewebsiteandaudio.There'snotalotofargumentforthat.Mostlyyouputituponvideo,right?Thesamecontentcanbeupandwritten.So,itcanbepageafterpageafterpageonyourwebsiteoftestimonials.Thebestexampleofthatis,atleastitusedtobe,wasEAS.IfyoulookatwhenBillPhillipsranEASanditwaslocatedjustafewblocksfromhere,heis,"Whatdidyousee?"Ifyouopenedhisbook,theentirelinerwastestimonials.Theopeningoftheproduct,itwasalltestimonials.Itwasallbefore-and-afterphotos.

Ifyouwenttotheirwebsiteitwasthousandsuponthousandsuponthousandsoftestimonials,becausereallythat'swhatworks.Right?Haveyouguysseentheblueblockersunglasscommercials?Idon'tthinkhe'sbeenrunningitforawhile,butSilvermanwasthedirectresponsemarketer.HecreatedthecompanythatwasbeforeSharperImage,andallthatstuff,andthenhedidthesunglasses.Theirinfomercialandtheirshortformspotswereliterallyacameracrewwalkingdownthestreet,andhewouldgrabsomebody,putontheglasses,andsay,"Whatdoyouthink?"They'dgo,"Wow,thisissocool.Iwouldneverhavethought..."Right?

Thentheysay,"Well,howmuchyouthinktheyare?""Thesemustbe,what,250,$300.""No,fornowyoucangetitfor24..."Right?Thatwastheentirecommercial,iswalking...Itwasoneofthemostsuccessfulcommercialsinhistory.TheydidmillionsofdollarsofcheapsunglassesimportedfromTaiwanstrictlybaseduponthat.That'sthethingthatyouwanttoputitaltogether.

Anyway,gobacktodirectmail,thinkingintermsgenerallyofthere'sacoupleofdifferentthingsthatyoucanputinthemail.OnethingthatyoucanputinthemailatthehighendissenditbyFedExandtheguywalksitupinthetruckandhasthemsignedforit.Foranormallikeconsumergetanewstudentin,normally,Iwouldn'tgotothatextent.ImightdoafakeexpressmailenvelopeorImightputinaprioritymailenvelope,whichisabout5buckstomail,but...

Speaker1: Prioritylocalisnextday.

Speaker2: Yeah.

Speaker1: It'sallnextday.

Speaker2: Well,fortheaverageconsumer,abigprioritymailenvelopeandaFedExisn'tmuchdifferent,right?Yes?

Audience: Samethingwiththeupgradeinformation?


Speaker2: Absolutely.Evenevenmoreso,right?Imean...

Speaker1: Wehaveaspecialninjadelivery.

Speaker2: No.Seriously,he'snotjoking.

Speaker1: Wehaveavideoofitandweplaythattoschooltoo.Wehaveoneofourjuniorinstructors.She's13.Shehasafullninja...

Speaker2: He'snotjoking.No.

Speaker1: ...leotardninjathingandshebringsthisgiftbasketuptothefrontdoor,ringsthedoorbellandthenrunsoff,butstrategicallyenoughtotheyopenthedoorandtheyseehergoingoff.Thenwevideoitwhileshe'sgoingupthere.IthastheDVDfortheblackbeltupgrade.Ithasat-shirt.Ithasourmile-highwaterbottle.Ithaslittlegiftslikepopcornsotheycaneatthepopcornwhilethey'rewatchingtheDVD.

Speaker2: They'vegotaDVDwithaliterofsoda,popcorn,anditsays"Makeafamily.WatchtheDVD."

Speaker1: Weusedtodosoda,butthat'skindoftaboo.

Speaker2: That'strue.

Speaker1: WeactuallydoGatoradenowbecausemostofthekids...

Speaker2: Yougottadowhat?Theredonethat'ssugar-freeorwhatever?

Speaker1: Wedotwodifferent...Wedoitdependingifit'safamily.We'llhavetwoofeachthingsinthere.Ifit'sforafamilythatoftwo,ifthere'sfamilyofthree,thenthere'sthreeofeachthinginthegiftbasket.

Speaker2: Bytheway,he'snotjoking.

Audience: No,Imean...

Speaker2: Right?Carol,whenshewalkedin,wesaiditbefore,shewalkedinandtheyhadjustwrittena$25,000contract,$8,000downpayment.Well,itwas...

Speaker1: Didwefindthatvideoforyoutoshowyou?

Speaker2: Youneversawtheconference...

Speaker1: Theywerepullingituptoshowyoubecausewehaveitonvideothere.It'ssofunny.

Speaker2: Whatwasit,$500amonth?


Speaker1: 595amonth.

Speaker2: Yeah,595amonthwith$8,000down.Now,for$8,000downand597amonth,wereyouwillingtodoafewthingslikethat?Yeah.Ifyouwereenrollingconsistently20studentsamonthandwererenewing87%ofthem,inotherwordsrenewing17,18ofthemamonth...

Speaker1: Bytheway,thatwasn'taone-dayrenewal.Itwasn'tlikewejustwalkedtothem"You'vebeenrecommendedforblackbeltandwewanttotalktoyouabouttheblack...Doyouhaveaminute?Comeoninandletmegiveyoutheprices."No.Ourintro,ifittakestwoorthreelessonstosignthemuponanintro,thenit'sgonnatakeanywherefromfivetotenspecialsessionsthatwedothewaywestructureitouttogetthemuptothatlevel,butnowwegottosofttrackagainstsomeofthem.

Speaker2: That'sthequestionheasked,isdoyoudothiskindofdirectmailtoanupgradeprospect.Absolutely.Whenwedoarenewalblitz,andwhatImeanbythatislike,thenewpeoplewhocomeintheinnercircleandkeyperformers,asyouknow,ifI'vegot...I'mgonnabeatMikeFerreriauntilhe'sdeafanddumb,ifhedoesn'tgetgoingonthis,well,he'sgotagoodexcuse.Hisgrandmotherisundergoingherthirdbacksurgery.It'stouch-and-gowiththatkindofmajorsurgery.Hehasarealgoodreasonfornotbeinghere.

Buthe'sgot135peoplehecanrenew.Ofthe135hecanrenew,worstcase,heshouldget65or70ofthem,andhehasn'tlaunched,whichdrivesmecrazy,becauseanytimesomebodyleavesaquarter-milliondollarsonthetablewhenit'slikethateasy,it'sjustlikemeyellingtohearguys,right,itjustdrivesmecrazy,but...

Speaker1: That'showwechangeDecemberfrom,itusedtoalwaysbetheworstmonthuntil,what,25,30yearsago,Ichangeditintothebestmontheveryyear.

Speaker2: Inarenewalblitz,let'stakesixweeks,Iwillmailtothemthreetimesaweek.Someofthepackageswillbeahundredpagesoftestimonials.It'llbealloftheessaysfromthelastblackbelttestwithpicturesofeverybody.So,stufflikethat.They'llgetlikethisbigpackageandthentwodayslatertheygetanotherbigpackage.Anotherdayslater,theygetanotherbigpackages,andallthesamestuff.We'vegotthebigpackageI'mhandingtoeveryparentwho'ssittingonthebenchesandtellingthemtoreaditwhilethey'resittingonthebench.Thenwe'llpullthemtogetheranddohisninjathingwithaDVD.That'sanewinnovation.Whenthevalueishighenough,youcandoallkindsofstufftogettheirattention,right?

Audience: Togetparentsinvolved,I'mjustthinkingtosendingthemagi.

Speaker2: No,no.Jonathan,he'sgotalittleminiaturegithathastheirschoollogoandit'sintherightcolor.Whowasthesupplieronthat?Doyouremember?WasitCentury?Hehasalittle,likeaminiaturebluetop,withalittleyouknowembroideredlogothatshowsupinapackagewithlittlepresentationlikewedothebluetop,"Here'syourbluetop.Now,comeinandtalkaboutgettingonethatwillactuallyfitbetter."I'mdeadserious.Right?


Yeah.Allofthisstuffisevenmoreso,right?It'sevenalsomoresoinreactivation.Right?See?

Speaker1: Everybodyforgetsmarketing.Ifyou'regonnamarketforanewstudenttocomeintospend2to3grand,whywouldyounotmarketevenmoreheavilyforsomebodytospend20to30grand?

Speaker2: Well,oncethey'reintheprogramandtheyfadedaway,whywouldyouspendthesameamountofefforttogetthemback?I'veheardpeoplesay,"Well,Iwouldn'tdothatforpaid-in-fullbecauseIdon'twanttobeinfrontofthemandhavethemaskforarefundorsomething?"No,no,no.That'sthewrongwaytothink.WhatIwanttodoisIwanttogoofftheledgedoingeverything,includingshowupattheirdoorstepandknockattheirdoorsteptogetthembackinclass,right?Because,one,iftheypaidinfull,I'vegotamoralobligationtogetthemtoblackbelt.Right?

Ifthey'repayingmonthlythey'renotgonnakeeppayingforverylongifthey'renotcomingtoclass.Eitherway,Iwanttogetthembackinclass.ThestuffIshowedyou,theexampleIwasusingwassummerreactivation.Kidhasbeengonetograndmother'sforamonthandhasn'tbeenin.Mailthemthebigthingwiththesquirtguninit,thenthemailontheboomerangthing,andthemailonthemagnifying,"We'vebeenlookingforyou."Andthen,mailtheplasticbugs,hatetobug,allofthatkindofstuff.It'sallcuteandhumorousandnutsy,butit'scuteandhumorousandnutsythatgetstheirattention.Right?

Youcansendthemabigform.Itlookslikeit'sfromalawfirmandit'ssquaredoffonbothsidesinitsformallanguage.Nobody'sgonnareadthat,right?Thisstuff,theygo,"Holycrap.What'sthat?"Right.Evenbetter,havethesquirtgunwithwaterinitandhaveplasticlaminatedpagesandit'sleakingoutoftheenvelope.Right?Thinkaboutthat.Right?

Speaker1: Ifthey'renotsoldontheprogram,ifyoudidn'tgetthemtoseethevalue,therealvalueofyourprogram,nobody'sgonnaputdown$8,000.Yousawthatcontract,whywouldtheyput$8,000down?Becausethey'regoingtodoitandtheymight...Whentheyputmoredown,wegivethemalittlebreakontheprice.Peopleliketosavemoney.Ifthey'vegotmoneysittinginanaccount,drawingahalfapercentinterestor1%,whynot,iftheycantheycansavesomemoney.Ihavesomeschoolownersthattellme,"Well,Ijustliketodomonthlypayments.Idon'tliketogetanypaid-in-fulls."AndthatwasbecausewhenIusedtoworkwithoneoftheguysintheindustry...

Speaker2: It'snotinabillingcompany'sbestinteresttonotbecollectingtheirpay.Butanyway,backto...

Speaker1: Howcantheybeabillingcompanyiftheydon'thaveanybodytobill?

Speaker2: Backtooursubjectmatter.THepaidinfullwillbenefityouinaninversecorrelationtoyourretention,butinalmostallcases,ifit'sasix-monthor12-monthpaidinfull,itdoesn'tdoyoumuchgoodbecauseinalmostallcases,you'regonnahavethemthere


thatlong,anyway.Butifit'sa36-month48months72months,yougottolookatyourlegalities.Alotoftimeswedopaid-in-fullstoseconddegreeblackbelt.Then,one,itkeepsthemlonger,becausetheydon'teverdropoutbecauseoffinancialreasons,andtwois,onaverage,comparedtonotdoingthat,wegettogeneratealotmorerevenue.

Goingbacktodirectmail,samethingistrueforreactivation,samethingistrueforrenewals.Thethingisyou'vegottogetwildlycreativeonthisstuff.Now,noneofitcostmuchmoney.See,that'sthethingIwantyoutoanchorin.Right?WhenIsendthemabigprioritymailenvelopewithaplasticsquirtgun,itwasthepostagethatcostmethemostmoney.Right?PriorityMailenvelope,that's5bucks.

Audience: Exactly.

Speaker2: Thesquirtgunwas49cents,Ithink.YoucangothroughOrientalTradingandcomeupwithallkindsofstuff,andincluding,bytheway,promotingaBuddyDay.Let'ssaythatIhaveaspecialthemeandit'sOlympicsBuddyDay.Well,youcanbuycheapOlympiclookingmedalsandallkindsofthingsthatarethemedthatway.It'sJuly4th,youcancomeupwithallkindsofthings.That'swhatOrientalTradingisfabulous,whereyoucancomeupwithallkindsofthingslikethat.Wehaveothersuppliersthatcancomeupwithallthisstuffthatyoucanactuallyuseastheenvelopethat'scrazy,crazy-looking.

Speaker1: WehavealotofstufffromDollarTreeandthePartyStoreorPartyCity.

Speaker2: Youknowwhat?IboughtatDollarTree,althoughdraggingmeinthereisanightmare.ButIwasdruggedintotheDollarStore.TheyhadstickersforabuckasheetthatwereDisneystickersandtheyalsohadarmystickersthatwereabuckasheet.So,forabuck,yougotlike20stickers.Sincewe'reallgoingtoDisneyinOctober,nowyou'regoingtogettheenvelopewiththeMickeystickerthat'sadimensionalstickerontheoutsideoftheenvelopethatcostme22asheet,adollarasheet,anickelapieceforthesticker,butnobody'sgoingtoignoretheenvelopewiththedimensionalMickeyorGoofyontheenvelope.Right?

WhoinhereatonetimeoranothergottheMrs.FieldsCookieBasketfromme?See,ifyouwenttooneofthoselittleregionalseminarswedidwithYKKim,anditlookedlikefromyourinformationsheetyouhadapulse,right?NowwhatImeanbythatis,anybodywhoisgrossinglessthanusually15,000amonthoranybodywhojustcouldn'tputtogetheranarticulatesentence,Ididn'tspend50bucksoncookiesfrom,butiftheyhadadecentgrossorlikeinyourcase,you'reintransition,buthe'sgonnasettheworldafireoncehegetsgoing,right?

Ilookatit.He'sgotagoodbackground,entrepreneurialonethingoranother.So,yougotcookies,right?Good.See?

Audience: Ididgetcookies.Don'tbeoffended.

Speaker2: Don'tbeoffended.Itjustmeansyoudidn'thaveapulse.Whoinheregotamoneytree?Anybodygetamoneytree?Yougotamoneytree?Doesthatgetyourattention?


Audience: Yeah.

Speaker2: It'slike,"Whatthehellisthisdamnthing?"Right?What'sthat?


Speaker2: Ithasn'tbloomed.Ithasn'tstarteddrawing.What?

Audience: Halfofitgotscalesinit.

Speaker2: Yougotthelittlescale.That'sfromOrientalTrading.Youknowwhathe'stalking?InOrientalTrading,ondifferentholidaystheyhaveinvitationsandoneofthemwasacoffinwhereyoufoldtogetherthecoffin.Ihadmydaughterdoingthat,right?So,I'vegotmy11-year-oldpayingherlike4bucksanhour,andshewasbitchingaboutit,foldingtogetherthesecoffins.Whatyoucoulddoisyoucouldputastickerinthecoffinandit'salittlesquarebox.Theycostmaybeabuckapiece.It'salittlecoffinwithalittleplasticskeletoninit.

Thenyouopenthecoffinandthere'sastickeronthereandthestickersaid,"Rightdamnnow,gotothewebsite."See,itgetsyourattention,right?Somethinglikethat,imagineyou'regoingtodoabigHalloweenpartyand...

Audience: Thatwasthepoint.Youdidn'tqualifyforcookies.

Audience: Ithoughtthat[inaudible00:44:36]wasdead.

Speaker2: Youdidn'tgetcookiesafterPhiladelphia?

Audience: Ididn't.

Speaker2: Okay.Well,see,thereheis.He'sbitching.He'sbitching.Theothergroupdidn'tgetcookies.


Speaker2: Yeah,theotherguysdidn'tgetcookies.Infacttheyprobablygota"No,pleasedon'teverfreakingcontactusagainaboutanything."Here'sthedeal.Imagineyougotoaseminarandyouhaveadoctorandhiswifewhoonlywanttofightwithyouoneverythingfortheentiretime.Theywanttopayyoumoneytositthereandargueeverypoint.Exaggeration?No.Everypoint.

Herewasthescenario.Forawhile,it'ssittingdown,there'sfourorfiveofus,butsomebodyelseinherewasthereinthePhilly,littlePhillyseminar?No.Butwe'resittingthere,theseguysaredoingatthetime3millionayear,andtheotheronesweredoing120ayear,right?Theotheroneswerearguingeverypointandhekeptwhackinghissonsaying,"Takebetternotes.Wherethehellistherecorder?"Theguyswhoaredoing3millionayeararehangingoneverywordandtheotheryo-yoswerearguingeverypoint.


Luckily,Tobywaswithmeandduringthething,nottoodiplomatically,"Taketheseassholesintheotherroomandgetthemoutofmyfuckinghair."


Speaker2: Ikeptthem.Ikeptthem,but...

Audience: Wegotaprivatesessionforyououtthere.

Speaker2: Isaid,"NeverPhillyagainforGod'ssake."

Audience: ItmustbesomethingaboutthePhillycheesestakes.

Speaker2: It'sonethingtohavesomebodywhogoes,"Well,I'mnotquiteconvinced."Somebodyelseisbelligerentlybothbrokeandarguingabouteverypoint.

Audience: Backonpoint.

Speaker2: Anyway,butallofthatstuffisrelevant,becausegetontheOrientalTradinglistandgetthestuffallthetime,andthenwalkthroughtheDollarStoreandthePartyStoreandlook.ThePartyStoresaregreatbecausethere'salltheSpiderManstuffandthere'sasuperherostuff,andthere'sallofthatkindofthings,soyoucanwalkthrough.That'swherewegotthesquirtguns.Wealsomailthelittletrophies.Anybodygetthelittletrophyinthemail?No.Okay.Wehadlikethehigh-dollarschoolsthatgotalittletrophy,andtheheadline...


Speaker2: Yeah.So,allyoubroke,guys,yougotatrophy?

Audience: Yeah.Theyhaveseminarsnextweekhere.

Audience: Igotamedal,too.

Speaker2: Yeah,trophyandamedalonit.ThatwasfromthePartyStore.Thosewere60centsapiece.So,it'saprioritymailenvelopewithatrophyandamedalonit,anditsaid,"Asyoumaynotice,Isentyouatrophyinthemail.That'sbecauseyou'realreadyawinner,but..."Right?Thenitwentwentonintomoreorlesslikethat,right?Iprobablydidn'tusetheword'but,'butI'msayingthisbecauseIknowyou'realreadyawinner,however...Isthatmakingsense?

I'vesataroundwiththreeorfourorfiveoftheofthe"marketinggurus"intheindustryandoneofthemsaid,"Well,onlyOlivercangetdirectmailtowork."It'snotthat.It'sthatthey'rejustnotwillingtobeoutrageousenoughorinventedenoughorentertainingenoughtogetittowork.Right?

Audience: Bestenough.


Speaker2: That'sexactlyright.That'sfirstthing.

Speaker1: Iheardschoolsactuallycomplainthatthepostagewastoohightosendoutthatmanydirectmailpieces.

Speaker2: Yes,sir?

Audience: Foreightyears,I'vebeenoffandonwithNAPNA.Thelastthreeyears,we'venaileditwithallkindofstuff.IalwayssaidIcan'tafford...

Speaker2: Right.

Audience: ThatwaswhenIwaslooking[crosstalk00:48:16].IpromisedthatI'mgoingtodothis.I'mnotevengoingtoaskyouaquestion,butyoucalledmeuptokeepmy...

Speaker2: Hewassayinghecan'tafforditto$99amonth.

Audience: Thenhetoldmyfriends,I'mlike,"Holycrap,howamIgoingtocomeupwiththat?"ButIdid.IdidandImadethemoneybackinthefirstmonthandseventimesthat.

Speaker2: Yeah.IwastalkingtosomebodytheotherdayandIsaid,"Well,it's1397amonth."Andhegoes,"$13,$97amonth."No,no,no.

Speaker1: Sometimesyougottospendmoneytomakemoney.That'swheremostofthemartialartists,they'resodamncheap,they'renevergoingtomakeanymoney.

Speaker2: Well,allofthisstuff,it'saboutreturnoninvestment.See,theamountyouspendisirrelevantifyouspendathousandtoget5,000.Youspend500toget4,000,ifyouhavethatratiothat'sgivingyoubacka5-to-1ora10-to-1or20-to-1.See,there'snoplaceelseyoucanputthemoney.Youcantakeallthequick-turnrealestategurus,andthey'renotgettinga500%returnonyourinvestment.It'stheonlyplacewhereyoucangooutthereandspend$500andalmostimmediately,becausesee...Imeanthewaywe'reworkingtheupgradesandeverything,really,it'sthefirst90days.

MyinternalmetricisI'mlookingtomakethedownpaymentbigenoughthatIselfliquidatethemarketingwhentheywritethefirstcheckorgivethecreditcard.Right?

Speaker1: Ithinkthat'showyoudeterminehowmuchthedownpaymentwereundertheprogram.

Speaker2: Yeah,seriously.

Speaker1: Thatactuallyyou'respending.

Speaker2: Yeah.

Speaker1: Yourecoupthatinitialinvestmentthattime,atthattime.


Speaker2: Well,thetheotherthingispeoplejustdon'tgetis,again,I'vesaiditmanytimes,Iwasmoreorlesslikethekidborninthesilverspooninmymouth.IwasbrokebutIwasraisedinthe[Junery00:50:10]Instituteandtrainedbythisguybothonhowtofight,whichIwasduckalot,butalsohowtohowtorunabusiness.WhenIstartedinDenver,thisis30yearsagonextyear,myinitialpricingwas$330downonanewenrollment.Extrapolatethatoutontheinflation,andthat'sabout$900now.

Speaker1: Well,mostschoolsweredoing150or100,orsomeofthemjustsay,"Payyourfirstmonth'stuition."

Speaker2: Yeah.Iinitiallywasdoing330down,75amonth.Youextrapolatethatout,that'stheequivalentofnowalmost$1,000downandabout200amonth.Right?Thatwas30yearsago.Whathappenedaswegottoocrowded,Ihad2,400squarefeetthathad600activestudents,andwhenIstartedratchetinguptheprice,whathappenedistheactivityandtheclosingratioswentup,right?

Ihadaneconomicsbackground,Ithought,"Well,there'spriceelasticityanddemand.Ifthepriceishigher,demandwillbelower."Itdidn'tworkthatway.There'sagreatbookbyCialdinicalled"Influence:ScienceandPractice."Heexplainsinthefirstparagraphofthebook.Hesays,"Absentothercriteria,pricedeterminesperceptionofvalue."Whathedoesn'tadd,butI'vediscoveredis,everybodyweinteractwithwantsthebest,assumingtheycanworkitintothebudget.They'renotlookingforthebestvalue.They'relookingforthebest.Then,iftheycan'taffordit,theygotothesecondoption,right?

Inourindustry,they'realwayslookingforthebestandifyoupriceyourselflikeyou'renotthebest,thenyouhaveaproblemwithperceptionandeverythingelse.Doesthatmakesense?Okay.Otherquestionsaboutdirectmail,notstaffing,hiring,compensationsystems,butotherotherquestionsaboutdirectmailorhowittiesintoInternetmarketing?

Audience: Howlongdotheystayin?Dotheyoptoutina12-monthcycleor...

Speaker2: Well,untiltheydieorthreatenuswithdeath,ifwemailtothem,again.

Speaker1: Younevergetanybodycomplainingaboutdirectmail.Theydon'tsay,"You'resendingmetoomuch,"becauseweallgetitfrom...

Speaker2: I'vehadit.

Speaker1: Youdid?

Speaker2: Yeah.Bytheway,theobjectionthatschoolownerswillhaveabouttherenewablesthingItrytogetthemtodoistheysay,"WhyamIgonnadoallthisstuffwithourstudents?"Iwasgoingtopissthemoff,right?I'vehadMrs.Jones,10differentpeople,atleast,comeinwithastackofcrapthatImailedtothemandsay,"I'msitting..."No.Well,here'showtheconversationusuallygoes.I'msittinghereeveryclass.I'veheard


themessage12times.You'rehandingmeallthisstuffphysically.Whydidyoukillsomanytreestomailmeallthisstuff?

It'sarealsimpleanswer.Mrs.Jones,domeafavorbecauseyou'retheexceptionandletmepointoutsomething.LookaroundtheclassontheaveragedaywhenBillyisinclass.Howmanyoftheotherparentsareheretheentireclasslisteningandraptattentionlikeyouare?Howmanyofthemdoyouthinkopenedthefirstenvelopethatwesentthem?Howmanyofthemdoyouthinkreadthepackage?MostofthestuffwegaveoutinclasswentinBilly'sbag.TheywentandjumpedintheSUV,wentoff,andneversawit?Whatwouldyouguesstheratiois?

Well,don'tmostofthempayattentiontothis?No.Thefactis,Mrs.Jones,you'reinthetop5%.Therefore,youpaidattentiontoeverything,highfive.That'swhyyou'rethefirstoneinthething,alsobecauseyou'reveryengaged.However,thebottom50%,wehavetohithimoverthehead22times.Frankly,inthreemonthswhenthepricehasgoneupby25%,I'mgoingtohave20%ofthestudentswhoaremadatmebecauseIdidn'ttellthem,eventhoughasyouknowwesenthome32piecesofdirectmail.Wetoldtheminclass92timesandwecalledthem.Right?It'saneasyexplanationinthatcase.

Onallthesefollow-uppieces,bytheway,email,youalwayshaveanopt-inlinkoranopt-outlink.Now,ifyou'reusingwhetherit'sAweber,Infusion,orwhatever,ConstantContact,theyallgivethemanopportunitytooptout.Right?Withtextmessaging,theautomatedservicesallhaveanopt-outlink.So,youcanhititortextbackstoporhitthelink,andthenyou'renotgoingtogetanymore.Right?

Withbroadcastvoicemail,youalsoarerequiredtohavethat.So,theserviceshaveapress8tobeoptedoutofthedeal.Withdirectmail,technically,there'sado-not-mailthattheDirectMarketingAssociationwillkeepalist,andrealityiswejustleavethemonthelistforever.Oneisit'soneinathousandgetpissedoffandfranklythatsameoneinathousandaregonnagetpissedoff,nomatterwhat.So,it'snowwhat'stheirexcuse.Right?

It'slikeyourstudentbody.Youhave1or2%ofyourstudentbodywhoaregonnabemadnomatterwhatyoudo.Right?Ifyouradicallyimprovetheprogram,they'remadbecausesomethingchanged.Again,myfriendKeithKathner,Iwastalkingtohimonetimeandweweredoingabunchofstuff,andIwaslamentingandfeelingsorryformyself,andsaid,"Ohmygod,we'redoingalltheseimprovements.Igotlike5%whoareupinarmsandmadbecausewe'redoingallthisstuff."Isaid,"Justpeopledon'tlikechange."

WhatKeithsaidtomewas,hegoes,"Well,Ithinkyou'rewrongaboutthat."Isaid,"Whatdoyoumean,Keith?"Hegoes,"That'snotit."Isaid,"Well,whatisit?"Hesaid,"Well,5%arelookingforareasontobemadandthat'stheexcusedujour.Right?We'reafraidwe'reafraidtogothroughandrenewthemallbecausesomepeoplearegonnadropout,becauseyou'rerenewingthemall.Butthenifyoulookatthenumbersinretrospect,itwasstill5%thatmonth.Thatwasjusttheexcusetheyusedthismonth.Right?


It'sallaboutnumbers.Ifyouknowthenumbersandunderstandtheratios,there'salwaysgonnabethatratio.Right?Ashesaid,ifwegoinanddoagymteacherforthedaytypeofthing,wewon'tbeatthemtodeathonoutboundtelemarketing,becausethat'swhattheycomplainabout.Butwewillbeatthemtodeathondirectmail,becausenobodycomplainsaboutstufftheygetinthemail.Right?

They'reusedtogettingthreeVictoria'sSecretcatalogsaweekorthey'reusedtogettingbeattodeath.Hell,ifyou'reonOrientalTradingslist.Igetfourcatalogsamonthfromthem.Igetthebusinesscatalogandtheholidaycatalog,andtheeducatorcatalog.So,they'reusedtothat.

Speaker1: Ifyoudothegymteacherforthedayandyouofferanyofthekidsthereiftheystopbytheschoolandtakeatrialprogramfree,yougivethemfreeuniform.Howmanyofthosekidswanttocometotheschool?Well,yeah,youhavetospendalittlebit.Youhaveahundredkidsthatmightdropbytheschoolandpickupauniformandtakethemtoclass.It'sgoingtocostyou.I'veactuallyhadschooldayswhereIhadsomanycomeby,andthoseuniformscostme...Ihadtospend$1,000forthoseuniforms.

Speaker2: Twelvebucksauniform.

Speaker1: Isaid,"Waitaminute.You'regoingtocomplainbecauseyougotahundredpeoplecomeinintheschool?"Isaid,"Youonlyneedonepersontosignupandyoumade2,500andyouonlyspendathousand."Sometimesyoujusthavetoexplainthat[inaudible00:57:25].

Speaker2: Yourbatteriesaredead.Isthismakingsense?

Audience: Yes.

Speaker2: Right.Yes,sir?

Audience: Ihaveanotherdirectmarketingquestion.

Speaker2: Goahead.

Audience: Thiswouldbetheinappropriateforumforthat,sir.

Speaker1: Couldyoustayontopic?

Speaker2: Yeah.Whatthehellgetyoubackontopic?

Speaker1: Wewerelearningsomething.

Speaker2: Whoinherehasheardmyvoicemailonmyphone?Mynewvoicemailisgonnabe,"Idon'tliketotalktohumanbeings.Justtextme."Igiveuponemail.Ifyouhavemyvoicemail,basicallyitsays,"Idon'tusevoicemail.Don'tleaveamessage."It'samazing


howpeoplearelike,"What?"IntheIQtestishowmanypeopleleaveavoicemail,onthevoicemailthatsays,"Idon'tusevoicemail."Goahead.

Audience: Ithink,Idon'tknow,inthefourorfiveyears,we'vegotourstudiosortofhowitisrightnow.I'vegotsomethinglike7or8,000contactsofpeoplethatIcouldsendstuffto.Obviously,I'mnotgoingtodoallofthis[inaudible00:58:22].

Speaker2: I'lltellyouwhatyoushoulddowithallofthem.Whatyoushoulddowithallofthemisessentiallytakethatlistanddoleadgenonthelisttogetthemtoraisetheirhandalittlebitagain.Then,oncetheyraisetheirhandalittlebitagain,thenyoucangothroughallofthisstuff.Right?

Audience: Whatdidyousay?Leadgen?

Speaker2: Leadgeneration.WhatImeanbythatis,andwe'lltalkaboutitmoretomorrow,butoneofthethingsthatI'mgoingtodototheentireindustryisbasicallyeight-pageletterinanenvelopewithastamp,butit'sabulkmail,andthenitlookslikeit'shandwritten,legalsizepieceofpaper,folded.Thenitlookslikeit'sanewspapertearsheetandit'sfoldeddowntheenvelopewithaPost-Itnote.ThecostofthatisIthink47cents,49centsand67cents,right?

Now,youaggregatethatandyou'reatabuck60.So,youmightbewillingtoput10,000intofollowingupwiththoseguysoryoucando...getmembersorGregcandocolorpostcards.Ialwaysdosequences,right?So,Imighttake7,000anddo40centsapostcard,bulkmail,doitthreetimes,andnowI'matabuck20.LesseffectivethanIthinktheotherthing,butstillIcanrakethroughtheentirelistandgetthemtoraisetheirhand.Oncetheyraisetheirhandyoueitherimmediatelygettheminforanappointmentoryouputthemintheotherfollow-upsequence.Right?

Mostofthewaytoraisetheirhandisgivethemabigfreeoffergift.Okay?So,abigbonusfreeofferforgoingtothewebsite.Ourversionofthatforanappnowisthis,thefreevideo,it'safreecopyofthebook,it'sthefreeone-on-oneconsulting.Yourversionofthatcouldbethefreeparentingbook,thefree...Itcanbeallthatstuff,butit'sjusttogetthemtoraisetheirhand.

So,let'ssayyourakethroughit.Let'ssayweget10%.Nowyougot700toworkwith,andnowthere's700toworkwith.Yougooutlikethatifyoudon'tgetthemintotheschoolrightaway.

Documents

2012 Bootcamp 7 1 - Amazon S3s3.amazonaws.com › NAPMA › data_members › PRODUCTS › Comple… · 2017-11-29 · To learn more about Stephen Oliver’s Martial Arts Wealth Mastery: