How To Sell Services To The Ultra Wealthy | Ep 957

0:00Welcome back to the game. In this episode, I had a conversation with two business owners. The first one is a membership business currently doing about a million bucks in revenue per year and looking to get to three. Her main problem is that it's taking about six months to make a customer profitable on ads. So here's what we broke down on this call. Number one, how to structure membership offer and bonuses to significantly increase LTV. Number two, we worked through how to do a mop up campaign so she can collect more cash up front from annual membership sales during her five day challenges, which is how she sells people.

0:27My second conversation was with a service based business. that sells to ultra high net worth families and family offices. They're currently doing 1.6 million in revenue and are aiming to hit 10 million by the end of the year. We broke down exactly how it would restructure their pricing and add on an annual retainer that would allow her to sell more to her customers while adding recurring revenue. I hope this is super valuable for you. Enjoy. I teach crafters. I'm mostly women, 45 plus. You teach crafters? For themselves. Crafters make stickers. Okay, love it. I love this. This is great. Okay. They're making stickers for themselves or for their family or to sell.

1:04Right. So my business with Maze, it did all the sets and stickers last year. Good for you. And I sell all low tickets. Good for you. Digital products. Thank you. Okay. So you made a million plus. Okay. Yes. Amazing. Between$7 and$270. Okay. And the main continuity I have is a membership. It's my main$27 a month or$270 per year membership. I really want to be at 3 million UST per year, but my constraint, I think, is 30-day cash. So on the new membership funnel that I have for ads, I collect about$60 in the first 30 days per new member. Okay. But when I basically, numbers on my past recent launches, it's probably costing me about$90 to acquire them with MetaAmps.

1:52So I just feel like I can't scale profitably. What's churn? What's LCV? What's churn? What's LTV? So churn is 93%. And LTV bounces a little bit depending on launches, but it's around$300. Hold on. So$27 divided by 7%, right? Okay, so 385 is true LTV. Okay, that's fine. So big picture, just so we're clear, you're spending 90 and you're making 385, right? right well 385 is across the entire like my all of my members so i haven't worked out the ltv specifically for the ads funnel okay are you on school this membership is not on school but i do have a smaller membership that is on school okay because on school you could it does by cohort so you can actually see cohorts by month so you can see when you have your launch months and you could follow that cohort to see its turn yeah i need to start tracking this i can do it myself i just haven't yeah it's a pay i mean we spend a zillion to do that on school anyways not a school ad okay so you're at you're at 60 is what you're collecting in cash it's costing you 90 you're not sure on ltv but you feel comfortable saying 300 yeah that's the unfair okay got it and the problem is that it takes you two months to break even rather than one the way that i've worked it out and i may not have all of my numbers here but that it takes longer than two months okay yeah I trust you.

3:18I trust you. It feels like, because I'm all good with paying in advance and taking a hit on ads to get like a recouped cash, but it feels to me from what I've worked out that it's probably more like six months. Okay, got it. So when you're making the offer and when you're running the ads funnel, is it running to a webinar or running to a five-day event? What is it running to? Yeah, five-day, well, three, four, five-day events. I'm going to have one right now. No, you're good. It's a paid event, yeah. Okay. What's the offer that you sell at the event? price point? The payment is$10 and an offer is the$27 a month or$270 a year.

3:55And then I've kind of switched in and out different kinds of upsells to try and increase the car value. Okay. And so what percentage are taking the prepayment versus the$27? About 10 % take annual. Yeah. That's because you're, I mean, if somebody has the offer between the two and you're giving them 16 % off, what bonuses do you add to the$270? Or is it literally the same offer with the discount previously yeah i've done joining bonuses every day of the event but i haven't restricted it to annual members only and i feel that i'm making a trick there and i've considered because i'm in the middle of the launch right now i could implement an annual members bonus right now even for existing members to upgrade so otherwise apart from the two months they get nothing else extra i honestly think you could you can very easily solve this with two steps.

4:43All right. So here they are. Number one is that when you're doing a five day selling event, you need to sell the expensive thing. Yeah. So your fear is I'm going to, I want to sell this recurring thing because I don't want to lose anybody. But the reality is that if you have five days with people, you could to a consumer audience is what you're selling to 300 to 600 is the impulse purchase window for a consumer. 300 is the low end, 600 is the high end. That's your range. You could probably go up a little bit and you'd still probably, you'll make more money at five or 600. I'm just telling you right now, if you wanted to go crazy, I'm just telling you, you would, but you need to sell the annual upfront.

5:16All right. That's number one. And what I want you to do is come up with one to two big bonuses that are going to be annual exclusive. Okay. Yeah. Now, after the event is over, what you're going to do is you're going to do a scoop up campaign. So it's five days and you're going to retarget everybody who saw the ads directly to your$27 purchase page that's$27 per month, and you're just going to remove the bonuses. Yeah. That's it. That'll fix your cash. I like that plan. You can do it? Yeah. I like that plan. It's something that I haven't focused on enough before. I have tried increasing the price a few times to a bit higher, not even in the 300, 600 rent.

5:59But I feel it because I haven't offered a big enough bonus package. That's definitely, it hasn't helped. So I can absolutely do this. I love this for you. Now, let me give you a little something else. There's probably some sort of what I call physical product premium that you can add to this. So are there any, is there like a kit? You can't do it for this one, but for next one. Is there any kind of like physical thing that you can give them? Like the paper, the printer, the, you know, that kind of stuff? There are so many things physically that I could put together. There are so many things. I have no clue about doing this.

6:33maybe Vantage is a good place for me to ask because it's something that I know has worked well otherwise in the creative stage for friends. So I'm sure that's something I could do. I just wouldn't know. Yeah. So I would say this, if I were you, what I would end up doing is I would sell them the printer with the paper. You can't do it by this time because you're like two days away from pitching. So do what I said first, you know, add the annual with a bonus, but you will dramatically increase your conversions if you add a physical product that makes this pitch tangible. because the thing is, is people need people.

7:03Have you ever heard like people need a reason, but have an excuse? All right. The idea is that like these ladies, I'm assuming they're ladies, 45 plus, want to, they want to buy it, right? They have a reason, but they need an excuse. The excuse to legitimize the purchase. They can go to their husband or their spouse, whatever, is they say, hey, but I got this thing, which I'm going to use to generate money. Or like they get something, not just like a login. So a consumer's willingness to purchase goes up dramatically if it's physical. And so I think you'd actually be able to push a$1 ,000 price point if you included the physical thing.

7:35Yeah. My head is swirling now with so many different physical things I can put together. Even if it's only a one thing to test first, like, yeah, I've never even considered doing that. So step one, step two, because I don't want to overwhelm. Step one, add the annual, make that the only offer available. I want to be clear, the only offer available is the annual with the bonuses. You cart close. After the cart closes, then you do a mop-up campaign. That's the$27 a month thing, but it doesn't have these two key bonuses. Okay. So annual only at the next launch. Yes. And then after the launch completes, then I offer monthly as well, but with none of the bonuses.

8:12So basically you do two cart closes. Cart close one, and then you do cart close two. Yeah. Yeah. Okay? Yeah. And you can, like, let's say there's three bonuses. You remove two. You keep one at the 27. So that allows you to cart close the second one. and then you have your normal everyday activities that don't include those three bonuses. Yeah. Cool. Okay, and if people ask for monthly, because they would, do I just say no? Right, I would just say like, I would say like we have options for monthly, but you're not going to get these bonuses that I just spent all this time talking about and they're going to be like, I like that.

8:42That's fun. Yeah, that's all. I really want to be open and honest, yeah. No, of course. Do not lie, but you can make it less convenient to purchase the thing you don't want them to purchase. Yeah. Cool? I thought that helps. Okay, that's really awesome. Thanks so much. You bet. Talk soon. I'll see you inside the group. Peace. All right. Cheers. Cheers. Cheers. John, do you like that one? Cheers. That's one of your people. I know. You're like, how am I saying a Chinese man has an Australian background? Well, it's because he's from Australia. It's very mixed up. Okay. This is awesome advice. Thank you, Haley.

9:14I appreciate that. Izzy, what's up? I have two women in the chat. Holy cow. What a day. My 87 % male audience. Izzy, I appreciate you guys. We're making a difference. We're doing it. We're doing it, guys. All right. What else we got? We up? All right. Hi, Allie. Let's rock, baby. This is Sarah. Sarah? I, yes. Okay. Hi, Sarah. I sell interior design and wellness advisory services to ultra high net worth families and family offices. Okay. Love this. I am that. Yes. I'm the avatar. Exactly. You are my avatar. Yeah. Okay, what's revenue? What's revenue? It's currently at 1.6. Okay. And I'm looking to be at 10 million by end of next year and then scale this to 250 million in the next 10 years.

10:09All right, let's rock. What's the problem? So it's a little bit of a Van Westendorp issue where I'm building out this ladder and I have a question about the pricing structure. basically would you or Tony Robbins buy this ladder? Okay. Kind of the constraint I have right now. I want to pull it before we scale it. Okay. So I have three tiers. The first one is the lowest and it's$80 a square foot for renovating or building a new home. And that includes all of the construction selections, the drawings, the furniture layout and selections. we incorporate about a dozen different layers of wellness and we collaborate with the builder and architect.

10:54So that's tier one,$80 a square foot. And the whole vacation is that we convert their home into a wellness sanctuary so they don't have to leave to go to a wellness retreat. Okay. And tier two is a seven to 10 year commitment across their whole real estate portfolio and it's a hundred dollars a square foot because we do everything that's included in the first tier we also add um strategy across the residences a plan for sequencing the rates are locked in across that time period and we do like a property review to make sure every function of each property is in alignment and then the final tier tier three is the other two tiers plus more of their whole ecosystem so we advise on their yacht their plane their offices and they get curated annual experiences like we'll go to italy and pick out their slab for their countertop we'll meet the artist in vienna whatever it is they get priority placement they get a 15-year road map and they get annual council reviews where they've had a life event a baby, an injury, and we're presenting to the board about what we'd recommend.

12:11So they get priority. What's the price on that? That one is$100 a square foot as well, but there's a$200k stewardship retainer annually. Okay. Have you sold many of these? no well short answer the top two tier two and three are what we're adding the tier one we've been doing for 20 years so that's what i'm saying like i don't know i've run this through the ai like three different ways um i just don't know how to build this ladder yeah hmm well i'm not actually sure if a ladder is the approach I would use with this with the business you have okay because when you talk to me through all all three of those the first one made a lot of sense and the other two I was like kind of squinting a little bit um okay because fundamentally let's say you did tier one and then I said hey can you do my yachts too you'd probably be like yeah sure right and it would just be like at tier one and so for fractal pricing to really work it needs to be like five times the price and so like going up by like 20 that's like it's too it's too undifferentiated does that make sense yes and also for me 10 year 15 year commitment sounds very heavy okay like i think the richest people in the world want flexibility we want options and we want speed and we want to make sure that it's very easy and that when i pay you i don't have to redo it because then I would hate you.

13:43Right. Right. So, and the goal is like, I want to be working with families through all their generations. I want to be doing all their properties. So rather than them hiring a designer in Spain and Dubai and New York, I'm doing all their properties. So here's what I think you should do. I actually think your annual retainer should be de minimis. It should be like a rounding error in this project. And the reason for that is, and I'll explain why. So we do this in home services a lot. And the way that it works is like, if I sell you a hundred thousand dollar thing, right? I would say, Hey, you know, we do a maintenance plan for$500 a year.

14:22And it's a, again, it's a tiny percentage of the thing. And it's because you don't care about the money and it should be positioned as insurance. Like I'll come by once a year just to make sure everything's working the way it should, all that kind of jazz. Right. And it's like, that's what most people do anyways. And so what it does is it gives you an excuse to always meet with them every year. And as soon as you walk into which person's house and you're an established vendor, they're going to have shit for you to do. So to me, that's, you probably need more continuity or want more continuity, I'm guessing, in the business.

14:50Yes, but I want to help people at a deeper, more integrated level, almost like a fractional board advisor for their properties. So like we don't replace their estate manager, we partner with them. I guess my concern that makes me nervous is that I don't want to be like just doing, oh, we're going to, you know, will you help us refresh our bathroom or redo the kitchen and like small renovation projects? I want to do the whole home. I think that that's all going to come down to like the, the, how rich the people that you were talking to are, you know what I mean? Um, Um, and as, as much as I may, you may hate to hear this, like the big, the small jobs get the big jobs.

15:35Yeah. You know what I mean? So I do hate to hear that. Yeah. But the thing is, is it doesn't mean they're less profitable. Right. And if we, if you think about it as like, this is me maintaining the business so that in three years or what, cause the thing is, is rich people buy houses and yachts and planes all the time. Right. And so like every year they're going to buy something or every other year they're going to buy something. So if it's an off year, you still make money, you still keep the relationship, you're still top of mind. And then I would like, when I go there, I'm like, Hey, what else do you have in the, in the pipeline of acquisition that we need to be looking at?

16:03And then that you can price that way. Cause like fundamentally your pricing already scales with the size of the thing, right? So you could have like a yacht pricing, a jet pricing and a house pricing that would make more sense to me than having these tiers. And then, and then the maintenance plan I would weave into it. You don't call it maintenance, call it street, whatever, whatever you want. It's I'm coming by once a year, I'm gonna make sure your shit's not fucked up. But then when I'm in there, I'm going to ask whatever shit you got going on i'm gonna sell you more shit okay so it's more of here's my core offer and then i have a continuity plan that it's just included and it's like an annual retainer and okay and then i can figure out some really great inclusions to include with that do you think that the 80 a square foot for the core offer if figure we typically do 10 000 square foot i literally did the math in my head.

16:55I was like, yeah, I was like, okay, it's 800 grand. It's funny because when you said the$80 a foot, I wrote it down and I was like, the first thing I'm going to tell her is that this number means nothing to me. And what I mean by that is like, I don't know what$80 a foot is. The likelihood is most, especially new customers, this will be, they're either going to only buy from you because of your referral, right? Or they're pricing out three different people. And at the end of the day, if you come up more buttoned up, more professional, better finishes, better looking aesthetic, you'll win the business.

17:28Right. Because they're coming to you not because they're trying to save money. They're coming to you because they want the best shit. Right. And we've decommoditized ourselves by saying we're a wellness advisory, which positions us really as the only one in the world at this point that deals at the level of wellness that we do and interior design. so we're not a commodity and they can't really price this out apples to apples so it's opened a lot of doors including with like the rockefeller family office but i i just want to get you know the pricing dialed in so you're saying that if i were to pound a family office like their ceo if you said 100 a foot or 80 a foot i have no clue they're just going to do the math and just figure out how much it costs you know i mean like it means it's whatever but giving them that formula is okay yeah it's fine like it's okay They're just going to do the math.

18:19It isn't like you could have that be internal and just price the job and send it to them. Well, yeah. Yeah. I want to like give them something so that when they get on the call with me, they're not completely blindsided. Like I'm trying to set the expectation of, yeah, we do$20 million minimum for the value of your home. And, you know. I think if you set that up front. Again, I don't think the$80 really does much. Um, but if you set that expectation up front that are like, we only deal with ultra, ultra high net worth and family offices and it's$20 million plus, you know, estates minimum, there are going to guess that you're more than a hundred grand.

18:57Right. Yeah. Right. Okay. So I would, I would, I would not do this ladder. I would have maybe, I don't even really care about the ladder in general. You're going to price your jobs because you're so bespoke anyways. You're bespoke. And so I think the key point is like, sell whatever you can get away with. a lot of people, like if you're a soul at the table, as long as you give them exactly what they want, they'll love you. Add in the continuity so that you can keep getting business from them and it'll stack year over year. Okay. Okay. Well, I'll just go$100 a square foot and the continuity and figure out some awesome features for that.

19:30100's a nice simple number, right? Very easy to do the math. Super easy. Do it in your head. I love that. Okay. Amazing. Thank you so much, Alex. And I'm coming to L1 in March, so I will see you soon. Rock and roll. Appreciate you. Appreciate you. Take care. You bet. All right. Let's go. Let's rock and load, baby.