Why book writing sucks (statistics), Google Search revenue increases 14% YoY to $46 billion, Pinterest shares soar 18% on earnings beat, strong revenue growth, Advertising revenue grew 24% in the first quarter, outpacing retail and cloud computing

0:01All right. So welcome to the Agency Owners Association. My name is Eric Su. I do this group alongside my podcast co-host, Neil Patel. We do a podcast called Marketing School. And both Neil and I, we've been in a handful of groups. We're actually both in a group called YPO. I've been in a group called EO before, so Young Presidents Organization, Entrepreneurs Organization. And we thought it would be helpful to have a group, a peer group for agency owners where people can connect and they can all help each other elevate, right? And we know a lot of agency owners, they're struggling to grow faster.

0:34They're struggling to get more clients. they're struggling with operational issues, hiring issues, and both Neil and I have been through all that, right? So in terms of covering getting an agency to six figures, seven figures, eight figures, Neil in his case got his agency to nine figures, right? Maybe even 10 figures one day, but we wanted to share those experiences with you to help you grow faster. And there's a lot of value in this group. You'll see below all the bullet points on the things that we currently have, and we're going to continue to add value to this group over time. And the cool thing about this group is you can cancel at any time.

1:04So there's no commitment. You can sign up right now for whatever price it says down there. It's going to continue to grow up, grow and grow. Um, I will tell you that this group initially started at 149 and it's going to continue to rise, right? So now it's going to be the best price to get in on it. You can cancel at any time. Just know that when you come back, it's going to be at the elevated price. And that's what we thought we'd do. And those of you that are doing seven to eight figures, once you join the group, or actually you can even see it, there's an application to join a live mastermind.

1:30So this is a live mastermind that where you'll be able to hang out with Neil and myself. And we'll have other agency owners at your level, but that's for agencies that are doing seven figures and above. I think once we have enough demand for maybe the six-figure groups, we'll figure something out there. But for right now, seven and eight figures for an in-person mastermind and then online community, a bunch of other benefits. If you're doing six figures and below, you'll see that right below. And then we'll continue to figure out and grow this thing as we continue on. So without further ado, go ahead and sign up below.

2:01If it's not for you, that's totally fine too, but no commitment. Why not? If it helps you, if you think it can even help you 10X the price that you're paying for one month, then why not just give it a shot, right? So that's it for this little intro over here and just go sign up somewhere over here and we'll catch you inside. So we've been doing a new format. We used to do one episode every single day, like clockwork, even if it was Christmas or New Year's. And now we started doing, or then we transitioned to longer daily episodes of instead of five minutes, try to get them to 10 minutes. Then we shifted to 15 minute episodes, five times a week.

2:37And then we shifted to you and I just record one long episode. That's around an hour and a half and we chop it up sometimes into five episodes. Have we ever released it as just one long episode? Yeah, we have. Okay. So let me just set the tone for this episode. Those of you watching on, on YouTube because there's this retention thing. You guys can't hang around for that long. So let me give you some context here. So the context here is we've been doing this podcast for seven, eight years or so, and we wanted to change it up because we used to do it every single day. It was seven days a week, five to 10 minutes an episode, right?

3:09And right now I think we're over 100 million downloads. We decided to change things up because we found that the format was getting stale. So when a content format gets stale, you have to change it up. So what Neil and I have been doing is exactly what Neil said. And we're curious as to how the results have been. So on this podcast, not only do we talk about marketing news, we also talk about the experiments that we're running too. So it's too early to say right now, but I will say that when we switch to one episode a week, all the numbers takes. So, so that's why we switched it back to five episodes a week.

3:40And then each episode is around 15, 20 minutes or so. When the numbers tanked, how much do they tank by? Uh, it was just for that one week. I think it probably tanked by like, call it 50 % or so. Okay. So it was a huge tank. Huge tank. Okay. And then you haven't logged into the analytics. I haven't logged in for like three weeks. Well, why don't you just log in and see the stats? I don't know how to log in my iPad. Oh, you don't save it on Chrome? No. Okay. I don't have it actually. I don't have. You don't even know how to log in. Yeah. Yeah. Yeah. I rely on you. But I will say from this format though, it's more enjoyable because Neil and I see each other in person and then the conversation is a lot more organic.

4:15And the way we do this now is we might have news from business and news from marketing that we're reacting to. And those will oftentimes be a backup. Oftentimes we'll just talk about whatever's interesting to us. And we try to carry over some of the private conversations that we have to. Funny enough, I was on the flight back today. I listened to part of your episode with Money Wise. And Sampar asked you what your net worth is. And you're like, I don't know. He's like, what? You don't know? He's like, oh, no, I know. But I'm just not going to tell you. So yeah. So the big lesson for anyone listening is when we went from seven episodes, we actually went to five before we just went to one, right?

4:52Correct. When we went from seven to five, did we see much of a drop in? We didn't see much of a drop. And plus I got some DMs from people saying that they liked the new format. They thought they would hate it, but they actually liked it because we went more in depth. Okay. So seven to five, we didn't really see much of a decline. We also didn't see much of an increase either in stats. But going from seven to one or five to one, either way, however you want to put it, we saw roughly you're saying a 50 % drop. Right. All right. So moral of the story is still producing more podcast episodes based on our experiment may be different for you.

5:26Producing more episodes, even if they're shorter, tends to generate more total views. And the big reason for that is you get a lot of people to listen to multiple episodes, which then helps you also on the ad front because people are, you got more total views so you can serve more impressions. Yeah. So, I mean, look, I think podcasting is still very much a, it's a red ocean kind of, there's a lot of interview podcasts out there. So you have to think about a format that works for you. It's really, when you think about YouTube, for example, or podcasts, more so YouTube, it's your idea matters a lot and the format matters a lot.

6:01So for example, if you look at Mr. B's content, I don't know if you've seen one of his long form things recently, we talked about it last time, but I still need to watch that right now. His is like one versus 100 or something versus this. Last year, it was like$1 boat versus, you know, billion dollar yacht, right? $1 home versus like billion dollar home, right? He had this format that he would follow. And then every six months or so, or every 12 months, he changes the format quite a bit. And that's kind of what we're doing now. So if you want to keep things fresh, you got to keep thinking about different ideas and different formats.

6:29What was the one versus 100? Is the same concept$1 versus like 100 grand? No, this one, it was one versus 100. And they're competing for a$250 ,000 cash price. And so it was from one-year-olds to 100-year-olds. And there's 100 contestants. That was the one where they were in the room in the box. You talked about that, and we talked about that on the last episode, and you broke that down for me. Yeah, yeah, yeah. Dude, by the way, I don't know if we talked about this, but you and I have both published books. You publish a New York Times bestseller. And this tweet is from Anand, who did CB Insights.

7:00That's his company, right? And so do you know the economics and the numbers behind the book publishing industry? No, but it must be terrible. Okay. Well, we've said before that book publishing, if you're trying to make money from it, generally don't want to do it because it sucks for that. Unless you're president. Unless you're president. Okay, like Obama. First lady or someone like super influential and popular like that, you can get paid quite a bit. Well, actually sitting on Neil's point for a moment, the influence matters a lot, right? So Anand says this, the book publishing industry is like the VC business.

7:31And some of these stats are pretty interesting. Some of you know already, But so there's some data from a recent antitrust trial. So Penguin Random House acquisition of Simon & Schuster transcripts were researched and broken down by Ellie Griffin. I don't know who that is. And so here's what jumped out. Bestsellers are rare. So it says, in my essay, writing books isn't a good idea. I wrote that in 2020, only 268 titles sold more than 100 ,000 copies. And 96 % of books sold less than 1 ,000 copies. Okay, that's still the vibe. Question. Do you know approximately how many authors there are across the industry with 500 ,000 units or more during this four-year period?

8:09Answer, my understanding is that it was about 50. 50, okay, over a four-year period. 50 authors across the publishing industry who during this four-year period sold more than 500 ,000 units in a single year. Yes, right? So 50 % of books sold less than a dozen copies. 50 % of books couldn't sell 12 copies, right? So basically publishers are like VCs looking for unicorns. So if there's 58 ,000 titles published in a year, 90 % of them sold less than 2 ,000 copies and 50 % sold less than a dozen, right? So basically no one's going to read your book and it's a power law type of thing, right? In VC, you're looking at only a couple of companies in your portfolio that will have an outsized return.

8:51Same deal here. So he's saying that the book publishing industry is still a good business for them, but it's more like venture. Yeah, exactly. So they're going to keep betting on it. This is why they give people advances, right? They assume that you have a big audience and they assume that a bunch are going to flame out, but they're happy to give these advances because it's the audience, it's the influence that these people drive that ultimately sells the books. It's really not the publisher and they're admitting it here. It's really not us selling it. It's some of these people are going to push really hard and do amazing.

9:18Some of these people have like fake audiences and that's what it is at the end of the day. Dude, some of these publishers are so difficult to work with. So I don't know the publisher that we use for the book that I co-authored. We did hit the New York Times bestseller list. but I remember when we were about to release our book, the publisher, even 30 days before, gets on a call with us and be like, you're not selling enough copies. We have other people. And I remember that our publisher was the same person as Lewis House. And I talked to him before I was releasing my book and I asked him, how many units have you pre-sold?

9:51And he ended up telling me that number. And then our publisher was getting mad at me that other people like Lewis are doing better and yada, yada, yada. and Lewis probably sold more books to individuals, but we had more volume because of two things. One, I went to big corporations and I was able to get them to buy like mass volume of books, not like, you know, 10 grand or 50 grand. I was able to get some people to write like a hundred, two,$300 ,000 worth of books at once. Right. And then the second thing is, is I had, uh, a course that sold tons and tons and everyone who bought the course got a free book and we sold arm and leg through there but they weren't registered sales let's say through amazon anything like that it was just corporate sales and they were just complaining to them like what are you talking about just with from my understanding i don't have their numbers but from my understanding we quickly sold i believe the advance was around a half a million bucks we quickly sold way more than a half a million bucks.

10:52So you covered your advance, right? Yeah, but it doesn't mean that they actually recuperated their money because there's a cost to creating that book. I don't know what the cost is. So guess how many books with advances of over$250K actually earn out? 10%. Am I right? 15%. So 85 % of books with advances of$250K don't earn it out. The parallel nature of the book publishing industry is also clear for the fact that 4 % of profitable titles drive 60 % of the profits. That's no different than any Pareto principal or any VC, for example. In fact, VC, it's like, you're lucky if one of them earns the entire portfolio, right?

11:30You might have one or two that handles the entire fund. But it has. Look at Sequoia, WhatsApp, right? Google, there are some of these major, amazing unicorns like HubSpot. And if they kept the stock, which I believe Sequoia Capital kept a lot of the stock for the portfolio companies, their returns were outsized. WhatsApp, I don't know the return on it, but I believe Sequoia was the only investor in WhatsApp. So it was a massive return. For the book that you published, what was the title of it? Leveling Up. So we sold like 11 ,000 copies, 12 ,000 copies, something like that. What did it do for you?

12:06Nothing. I just felt like I needed to write it. I wasn't trying to get business or anything. Because yours was more focused on like, what was your book called again? Hustle. Hustle. But I was only focused on saying I'm a New York Times bestselling author. So we did it for different motives. I just look at life as a game is what I should do. Maybe I should have wrote it later, but I just felt like I wanted to write it. It was just for fun for me. And so ideally what we would have done if we were just focused on the business is we would have wrote a what book? A marketing book. Exactly. You know Wiley hit us up a couple of times, right?

12:37He said, hey, you guys do marketing school. You guys should do a marketing school book. And then I was so booked out by that time. I wouldn't do it either. Dude, so everyone's like, if you're a New York Times bestseller, you're going to get way more speaking gigs. Did not help one bit. But the counterpoint to that is I already get hit up a lot for speaking and I did way before I wrote a book. And we turned down most of the gigs. So did it help? Did it not? I don't know there. Two, can help you get paid more per speaking gig. Didn't help with that either. Maybe because I had co-authors and the book wasn't around marketing.

13:08Three, it helps you get customers. Didn't let me get one customer, as far as I know. But again, could be because the book wasn't on marketing. If I had to do it all over again, I wouldn't. But if I did, I would have wrote a book on marketing. I would have not had a co-author. I think you would have done it yourself. I would have done it myself. And I would have probably not used a publisher. And I would have run ads on Amazon and places like that. And I would have ran the book as a loss leader, like a tripwire, in hopes that it gets me more potential customers. That's a good point. All right. Welcome to the marketing school school group.

13:41Okay. So marketing school, S-K-O-O-L group, right? And so this is a free group that Neil and I are doing. And what I want to do with this free marketing community is I want to build a very strong group of people that are sharing the latest knowledge, the latest trends, the latest topics, and we'll share our content as well. And we just want people to engage with each other and build a strong community, right? Because people ultimately stay for community at the end of the day. People are longing for community. And we thought with all the free content that we do, well, what's been missing a free community where we can continue to help people level up in terms of their marketing.

14:16And hopefully we can help people find jobs in the group. We can even maybe even create a job board, but even offer a lot of our other content, package it up for you just to help you get better at whatever it is that you do in the world of marketing and whatever it is that you do in the world of business. Right. So Neil and myself, you know, we thought that, you know, from a retention standpoint, we do a lot. We do very well with acquisition on all the channels that we have, all the audiences that we have. But from a retention standpoint, building something that's that we think we can be proud of for a very long time.

14:46Why not do a free group? Right. So we have a paid group, obviously, called the Agency Owners Association for agency owners. And if you want to go to that, there'll be a link somewhere over over here to that. But this group will always be free. And as long as people are continuing to engage, this group's continuing to grow, then we'll continue to invest more resources into it. But we thought this was a long time coming. So you can sign up for free. You might have to fill out some information or you will have to fill out some information just so we get a sense for where you are. And then we can start to help segment the group too, right?

15:14Based on whatever it is that you're looking for because we want to continue to add value. And hopefully we'll have a very strong database of people. And you just tell us what you're looking for, what you need, and hopefully we can make those connections. So go ahead and sign up somewhere over here and we'll see you inside. So my book didn't work as a trip tripwire because it was more like personal growth. It wasn't talking about marketing at the end of the day. And in fact, it was targeted to young, to a younger crowd, to personal growth for gamers at the end of the day. So it had nothing to do with my business.

15:40Right. But if you were to do it, I think, I think you'd be fine. I mean, it's a huge pain in the ass. You're probably gonna have to rewrite it like seven times. I thought people were BSing me when they're like, yeah, you're gonna have to rewrite it a couple of times. It's true. So no, I wouldn't publish a book again. Yeah. If you've ever built a website, you know how tough it can be to keep a strong design while ensuring site performance is fast. That's where Framer comes in and it totally changes the game. Framer is the design first no code website builder that lets anyone ship a production ready site in minutes.

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17:50Sign up for your$1 per month trial and start selling today at shopify.com slash marketing school. Go to shopify.com slash marketing school, shopify.com slash marketing school. So, okay. I mean, there you have it. There's the unit economics for the books. And then also that's a reinforcement that the 80, 20 rule, the Pareto principle is still very much in effect everywhere that you see. Yeah. Now you and I also the other day we were on the phone and we were talking about the marketing industry, right? So I don't know if you looked at Q1 earnings for a lot of the advertising companies, but you're also seeing the platforms now releasing earnings as well.

18:31So Google search revenue increases 14 % year over year to 46 billion. Pinterest's shares soar 18 % on earnings B and strong revenue growth. So the advertising revenue for first quarter, I don't know which, oh, this is for Amazon. Amazon's advertising revenue grew 24 % in the first quarter. It went from 11.8, it was actually$11.8 billion. The street expected 11.7, but nonetheless, it grew 24 % and$11.8 billion in advertising revenue is a nice chunk of change because it's highly profitable for them. But yes, when you're looking at all these numbers, these platforms are starting to do better from an advertising basis.

19:17We're still seeing our agency ebbs and flows. You know, excuse my language, but if you want to go back to the second half of 2022, the wording we use is we felt we were getting kicked in the private parts, you know, every single day. That was your excuse my language? Yeah. We got kicked in the private parts, really? I thought you were going to say something big. What a letdown. Okay, and in 2023, we felt the same thing. 2024, it's like we're getting kicked there every other day. So some days are good. You're getting kicked in the balls. Yeah, every other day. I don't want to be explicit on a podcast, but yes.

19:59But every other day. And plus, I have kids, so I've learned not to curse or say some of these words. They pick it up fast. And the moment they pick it up and you tell them not to say it, dude. It's like, oh, you said it. Yeah, and then they say it, and you're screwed. Okay, so you feel like you're getting kicked in the nuts less frequently now. Yes, but I still feel like I'm getting kicked. But we're still getting kicked in the nuts. Yeah, I mean, like every other conversation we have, it's like, hey, you're still getting kicked in the nuts? Yeah, still getting kicked in the nuts. Yeah. Yeah. It's terrible, dude.

20:28Well, here's the thing. So remember the guy that spoke at my thing last year, George Gammon, the guy that started off with macro? Remember that, dude? No. No, no, no. You were looking at homes because you were moving to LA. So anyway, so George Gavin, he's a macro econ YouTuber, we'll just call him that. He's really smart. Highly recommend everyone subscribe to him. And he shared some numbers. So one, McDonald's is saying there's cracks, there's weakening demand in the consumer, okay, at McDonald's. So this is on the lower end, right? At 3M is saying they're expecting less sales. Rubbermaid is saying that they're expecting less sales.

21:03These are all consumer products at the end of the day. And so based on what you're seeing, plus we talked about how I saw a mutual friend this weekend too, or a couple of mutual friends, and then they've all basically said that things are slowing down, right? And a lot of these people, they sell consumer products or they sell cheaper SMB products, right? And so, well, at the end of the day, we're seeing our lead flow is slowing down. It started a year strong. Our traffic hasn't really gone down you and i talked about this on the phone and so you know what we started the year off cautiously optimistic but i feel like um there's more nut kicking going on right now dude we're facing the same thing um we're not seeing things recover as fast as i like i watch uh the fed today pal speak i don't know if you saw what do you say no i just i just landed oh yeah you just landed from miami uh but when pal was speaking to sum it up um they are liquidating less of their bonds or whatever it may be.

22:03I think it's bonds. I don't know what they're holding. It went from 60 something billion. Securities. They're liquidating their securities from 60 something billion a month to 20 something billion a month. So they're reducing that. They're keeping the interest rates as is, which is the big thing. And they don't know what's going to happen for the rest of the year. If it's going to go down, if it's going to stay the same, they try not to you know commit to anything you know jamie diamond has said there's potentially i think he said this that there's potentially stagflation risk um and there's a couple other people there's um there's another investor on cnbc you probably saw this but nobody's really saying it's going to be good and i don't there's a chance there might not be any rate cuts this year so i'm not an economist i'm not that neither of us are yeah and i'm not that smart um but But someone asked him about stagflation and he squashed it pretty quickly.

22:55And he gave examples of stagflation in the past. And he was giving examples of the stats and what's happening in the last 12 months and how it doesn't look like it's stagflation. But time will tell. But he's saying at least right now it's showing that the Fed's changes are having an impact on inflation just not as fast as people want. You know where the 2 % inflation number comes from? No. Okay, so George Gammon said this. It was like completely pulled out of thin there. Basically, I think New Zealand a long time ago, their central bank was like, yeah, you know, well, how about 1 %? It's like, no, 1 % is too low.