My Word Of Caution To Direct Response Marketers | Ep 807

0:29And so many of you just do your virtue signaling. actually get into it is there's so many things you don't know. I think information marketers get a bad rap. And I think that that bad rap is justified. And the reason for that, and so like, if you think about career choices in life, it's like, you've got like, in terms of social rules, it's like, you've got porn, right? And then like, right above that, you've got info marketer. It's like just, and then like maybe like car sales, you know what I mean? Then maybe like insurance and mortgage, like, you know, you kind of work your way up the ladder until you're eventually at zero when you're doing manual labor.

1:09And so I would say all of those are below that. I say this somewhat in jest, but also somewhat seriously, which is that these industries, specifically information, tend to have a bad reputation. And I want to explain a way of thinking through this that I think may help you or prevent you from falling into that trap. But at least I think understanding the landscape better will make everyone hear more money and doing it the right way. Number one is, let's imagine we have four cows. Okay. Okay, so cow number one is unmarked. And we would probably treat that cow like any other wild cow that we find, which if we were a rancher, for example, we might capture the cow.

1:57We might let the cow go. And what we would do would be predicated on our history of dealing with unmarked cows in the wild. Our second cow that we encounter has a brand on it that we literally seared into the side of the cow that has some logo on it. Now, there's three permutations of what can occur once you see that look. So permutation number one is that you notice that it has a brand, but you don't know who the brand belongs to. And so what would occur is that you would treat that cow the way you would treat any cow that is owned by anyone. And so basically, it would generalize how you treat other people's property is how you would treat that cow.

2:42it would be generalized to that series of rules and behavior. If you're like, how does this have to do, just hang on. The third cow is a cow that you do recognize the logo and you hate the person who owns the logo. Now, in this incidence, you would change what you did. You might steal the cow. You might kill the cow. You might purposefully not take the cow back to the owner because you hate that guy. but it would change your behavior. And then finally, cow number four, let's say you love the owner. If you love the owner that logo represents, then your history of dealing with that past owner and their belongings is how you would treat the cow.

3:26You would maybe just take it right back to them and you'd take it back to them and you'd clean it and you'd make it nice because you want to do good by that owner. There's four basically possible situations that can happen with brands. Now, many of you are in the situation where you're cow number two, which is that you have a brand. And the thing is, is that no one recognizes your brand. And so then they will treat you based on how they generically treat people who have your style of business. And so the way they treat you and perceive you will be related to their experience dealing with other businesses like yours.

4:08Sometimes you'll deal with people who have never bought anything in the information space in general. Now, I like to delineate information and education because I think many people are in the information space. And I think the information space, by and large, does a disservice to humanity. I think that the education space is a very good thing. And it's fundamentally how humanity moves forward, because the goal of education is to change people's behavior. And so if you get into this game with the hope of purely making money, you will probably fall into the information space and make greater and greater promises and deliver fewer and fewer results.

4:50And by consequence, you will proliferate. You will continue on the legacy of your forefathers that have bad reputations. And that bad reputation will catch up to you, but you will probably quack, walk, and talk like other people that scam people. It's very difficult to get into the scamming conversation because fundamentally you have no one gets results, everyone gets results, everything in between is gray. And so at what line do we decide this is a scam, this is not a scam, right? It's an interesting conversation. I have a hard time defining it. I think a lot of it comes down to a word that I hate, which is intention.

5:32And the reason I hate intention is because you can never measure it. And so there are some people who are very well intentioned that deliver very poor results. And there are some people who have poor intentions and deliver great results. And so this is where it gets tricky. But I think many of you lack skills and lack patience. And as a result, build bad brands because you make promises you know you can't keep. And so I think the intentionality, the one that I can measure that you can know about is whether you're lying or not. And I think it really comes down to that. The reason people hate marketers is because they lie.

6:06And I think that many of you have relegated to that. And it's hurt my reputation. It's hurt some, I think it's hurt plenty of people's reputation. I think when you think about that cow example, the second cow, where you see a logo that you don't recognize. If that logo looks like logos that in the past have hurt you, you will assume that the person who owns this cow will also hurt you. And then you will steer clear. And so many of you rob people of their dreams and futures because you dissuade them from making purchases that would otherwise save their lives. There is a sales close that I like a lot, which I call Burn You Twice.

6:51and it goes like this. If a prospect says, you know, they're all the way at the finish line, and then they think to themselves, you know what? I bought something like this in the past and it didn't work for me. And so what do you say in that situation? Well, what you would say is the only thing worse than buying a bad investment once is having that bad investment prevent you from making a good one. Because when that happens, it burns you twice. Once when you bought it and the second time when it prevented you from solving the problem to begin with. And then you tie it with a metaphor. You say, for example, who here has dated someone before the person that you're with now?

7:26I would assume that many of you have, except for Kirby, who was his first. But we can assume that for most of you, you've dated more than one person. And so in this instance, that middle school boyfriend or girlfriend, that high school, middle school, you know, a boyfriend or girlfriend. If you broke up with them and then swore off dating in general, that relationship would have burned you twice. Once because you had some bad experience, but secondly, for every single thing, all of the benefits you would have derived from getting the relationship that you'd end up having when the right person is in front of you.

8:00And so I think many of you are preventing people from finding their second person because you're burning them so hard. and so the first rule of marketing and advertising in general is state the facts and tell the truth and you need to use your brains to think about what is unique about what i have there's always something that's unique first off there's you you're unique right and not in a special snowflake way but just literally like there's one of you and you live some set of unique experiences that hopefully should better position you to help somebody in the particular thing that you chose.

8:37Now, the reason that I emphasize proof over promise so hard, and I think this goes double for beginners, is that there's a lot of, I think, pilth. Is that what I want to say? I think that's the word I'm going for. Pilth? Sounds right. But basically, bad stuff being peddled by people who have poor intentions, which is they tell you things like, you should never give your time away for free. People won't value your time. Well, no shit. They shouldn't value your time because your time has no value now. And so what we have to do is earn the right to charge money. And the easiest way to do that is to fill up your calendar with people.

9:14So basically, you force yourself into scarcity. So hear me out. You deliver services such that you cannot physically do anymore, which means you have to keep seeking out people, keep giving stuff away for free such that you can't give any more to any more people any way possible because you're already maxed out. At that point, you will have cut supply. And what happens when we cut supply if we have any amount of demand? Price goes up. That's why it's on the logo of acquisition.com. It's the strongest force in all of economics, supply and demand. And so if you don't have a lot of demand, what do you do?

9:48You decrease the price to take people in. That then cuts your supply because you're meeting this demand. And so your remaining supply shrinks and shrinks. And if you deliver good services, what happens? You get word of mouth. But word of mouth now goes to the much smaller amount of supply that you have remaining. And price raising occurs. Now, until that happens, and this is the natural way of business, like this is how it works. And the people who try to shortcut you do so because they want to make a promise to you that, honestly, neither of you deserve to be making. Like I've started every business I have, every product line.

10:26I start for free. I always start for free because how could I know if it's any good? I got to get people in to try it. Try the food, try the cookies, right? Like try them out. Let me know. And this is fundamentally what, I mean, we do this with school all the time. We watch what people are doing, right? I mean, shit, like it's a free trial for school as is, like it's always free. And like, we get to see what happens. Many of you are lying and that is how you're selling to keep. You're making promises that you can't keep. And so there's one of two scenarios. You're either making promises you know you can't keep, in which case it's unethical.

11:02And the other situation is that you're making promises that you have convinced yourself you can keep, and then you shift the blame to them, which is the more common one, which is like, well, they got to do something. And I'll give you a framework that Google talked about, which I really like. It's the user is never wrong. Now, they obviously focus on users, but it's a different way of saying the customer is never wrong, which is there's a famous story and I'll tell it to you. So when Sergey and Larry Page of Google were thinking about selling Google to Excite. So there was a period of time where they thought about selling Google in general.

11:42And so they were pitching the board of Excite. And they had Excite pulled up and they had Google pulled up. And they typed in like university in both of them. And then Excite had like all these random universities and Google had like Stanford, Harvard, and like it was ranked in an order that made sense, right? The executive from Excite said, oh, well, if you had, you typed the query in wrong, if you typed it in in this way, we would have had the same response. And it was like in that moment that they realized that like they had this competitive advantage that would continue to compound, which is like you have to meet the user where they're at.

12:16You have to meet the student where they're at. You have to meet the customer where they're at. And so the businesses that meet people where they're at are the ones that are worth the most. And so what can I talk about? The value equation, the bottom half of the value equation, it's speed, effort, and sacrifice, right? How can we make things less risky? How can we make things faster? How can we make things easier? Many of you would be better served looking at the results that you have in the face and accepting the fact that you're probably not that good. And then upon realizing this, trying to get better.

12:51And I think that many of you are in such a rush to make money that the faster path than getting better is to lie about being better or to lie about the proof or to lie about the results. And as a consequence, you do yourself a long-term disservice because you will destroy your reputation. You do every person who buys your product a disservice and you do every other business in your space a disservice. You literally are a leech. You provide no value. It's like one degree above the people that literally pretend to be other people to get Forex trading and crypto things. And they make fake profiles.

13:29And it's a whole industry, one degree above that. And the main reason is just because you don't pretend to be other people, but you pretend just about everything else. A lot of the tactics that I teach, a lot of the methods that I teach help people believe you. But if you use them to sell people bad products, you will ultimately hurt everyone. And so the way to prevent against this is state the facts and tell the truth. Say what only you can say. Show what only you can show. Begin working for free. Allow the demand to continue to increase based on how good you are. Allow that increased taking on of demand to decrease your supply.

14:13Once the supply of you is smaller than the demand for you, then a price above zero will become natural. And then you will be able to continue to raise those prices as more and more people will be willing to pay you. and some of the free people, you'll say, hey, I have more demand and you're taking up a slot and this guy wants to pay me and you don't. So either you can pay me or you can leave. If you're doing a good job, they will pay you. And you go to the next guy in line and you say, hey, there's another guy who's willing to pay me and you're not willing to pay me. And you just keep going until eventually you've replaced your entire thing.

14:43And guess what happens now? You continue this cycle. You keep going because now the next wave of people, if you do a good job, these guys are paying you$100 a month. The next guy said he's willing to pay$200 a month. So then you replace one of your hundreds with a 200 and keep working your way. Right. And this is the beginning of things. Now, from a scalability perspective, all you're going to do is either raise prices, which is a wonderful way of living, or you increase your capacity, which you either do by hiring people where you make a margin on their time, or you change the service ratio from one-on-one to one-to-many.

15:16That's it, right? Those are the choices you have. You raise your prices or you sell the same amount, you know, more people, but you have more people helping you or you sell more people in there and people are getting a more fractionalized version of you. Now, if I had to make a bet for most of you, most of you would be better served doing a fractionalized version and basically bouncing back and forth between price increases and fractionalized versions of yourself. Main reason for that is that it just takes fewer operational chops to do that. Not to say there's anything wrong with having more people work for you.

15:48By doing it the way that I just outlined, you will incur more key man risk. You will be more involved in the business. You will not get further away from it, but it will make you more money. And so for many of you, you're like, I don't want to sell a business. I don't care about creating an asset. Like, I just want to make an income and this will help you do that. But to be clear, you will work as should you. You are a human being and we're meant to work. So, you know, welcome to reality. So let's say we've got, we've got two, two, two glasses. All right. So this is full of milk. All right. So it's not actually full, but just bear with me.

16:22So this one's full of milk. And let's say that I pour this one glass of milk. I pour a third, a third, a third in here. Then I fill each of these up with water. All right. So it's like kind of like slightly, it's pretty diluted milk. Now, when I do that, this is basically how I see you hiring somebody, training them over the weekend and saying, okay, you can now do the delivery for the customers. Well, if you're charging a lot of money for something and you can teach someone how to do it in a day, then maybe you're not that good or you're now selling somebody who's way worse than you. And so it's more likely that they didn't recreate your entire life in a weekend when you train them.

17:05And so what ends up happening is that when your customers try this now diluted milk, it tastes pretty bad, which is why I'm a big fan of instead of doing this, here's the alternative. alternative. So you have your big glass of milk, this cold, refreshing milk. And instead of having glasses that are the same size as this, we pour it into a much smaller container. So we pour it into three shot glasses, but it fills to the brim, but it's a smaller container. To me, if I were to ask you, would you rather have this diluted full glass of milk, or would you rather have a shot glass of perfectly diluted milk or perfectly, you know, the same amount of milk, which would you rather have?

17:44Probably the shot class. And so that is basically the difference of a fractionalized version. You going one to many, you going one on four, one on six, one on eight, is that you, and this is where the 201 version of this is that you just have to keep getting better. So that when you get fractionalized more and more, it's still valuable. And so I think for many of you, you would be best served not trying to hire tons of team. Of course, there's a time for that, but I think for many of you, it's not right now. And you'd be better served just getting better. And when your demand exceeds your supply of your time, you raise your price.

18:21And when it continues to exceed the supply of your time, by the way, when this occurs, you're already in the top 1%. It's like getting in the top 1 % is rare, not difficult. It's very simple. And the reason that people can't do it is literally because they lack patience. You can trace very clearly how successful someone can be based on how long they can delay gratification. The reason people think that writing a book is an accomplishment is because it's basically pure punishment for a year. And then you get$20 for a book. It's like the most punishing experience you could possibly imagine, right?

18:58Most people can't do it. Not because writing that many words is somehow complex. It's just that people can't stick with things. And so I will give you two rules that I think that the majority of human beings can live their life by. Number one, do what you said you were going to do before it became inconvenient. Number two, leave it better than you found it. And that goes for everything. It goes for customers. It goes for employees. It goes for the marketplace. It goes for the environment. It goes for your family. It goes for your kids. It goes for the buildings you walk in. because of the restaurants you eat at.

19:35Leave it better than you found it. It's a very simple, these are two very simple rules that are worth living by. And I think that if you just use those two rules, you could probably fix most of these marketing issues because many of you are not leaving people better than you found them. They're worse. They have less money and now they have bad taste in their mouth. And now you've dissuaded them from buying education stuff in the future, or rather information that would eventually become education if it was broken down more. Many of you are teaching things you have not done, which means you're lying to other people or yourself, which sucks.

20:10It really sucks. I think one of the big issues is that people have realized that the things that you can sell for the most amount of money tend to be things that help other people make money, right? The largest of those being investment opportunities. That's the biggest version of that. Underneath of that would be would be business improvement things underneath of that might be income opportunities like that's you know kind of on the on the how much money you can charge for something you know sphere right some of them don't pass the obvious like sniff test which is like if you were so good at crypto trading why don't you just trade crypto if you were so good at day trading why don't you just fucking day trade and like i get the silliest answers from the people who say that like who are who are doing this they're like well i just wanted to impact people it's like no you don't man.

20:58It's a fucking, it's fucking, no, you don't just stop. You don't, if you want to impact people go day trade and beat wall street actually, and then take all that money and build a fucking city. And so it's just like these obvious things. I wanted to make this because I could try and get into like specifics of like, obviously don't like, I could talk about this from a compliance angle. I don't think it matters. Like, I mean, obviously it matters. Basically if compliance is the reason that you're not doing it, you've already lost. And you're never going to win long term. The truth is like the sun.

21:30Like it always comes back out. Like you will get discovered. And it's going to be painful. And then you know what really is going to happen? Because I've been around this world for a while. You'll just fade into nothing. It's rare that you get like truly cracked out on. More often, you just ruin your reputation. And because you're not that good, you don't know how to advertise more. And so you just basically burn the people you know. And then everyone who knows you knows you burn. And they tell everyone else. And then you have a lot of false smiles when you show up to places and people kind of like, you know, and then when you walk out, they'll say shit behind your back.

22:07And it's kind of a tough way to live. I say this as a cautionary tale. You can win if you just focus on providing value. Just help someone achieve what they want faster, risk-free, and easier. That's it. Those are your vectors. How do I make it easier for them? How to make it less risky? How do I make it happen faster? And the easy way to make something less risky is charge less for it or charge nothing for it in the beginning. And that's okay. Like a lot of you just need to charge zero for a minute. Like I think as much as like we talk about the, you know, MRR, we're going to change some of the incentives around the games because we want to make sure that we push back against this.

22:45Having a free community is a wonderful way to make money. Like there's lots of things that you like building goodwill can happen in those situations. And so like you just give yourself, and I do think that having a free community trains you on, it's kind of like content creators, I think do a better job in general. Don't get me wrong. There's bad ones, but in general, the direct response ads guys versus content creators, content creators tend to do a better job with their communities because they have lived their entire life is based on their reputation. They have slowly compounded an audience over time by by setting promises, delivering our promises, and over time, kind of letting that audience compound.

23:21And so when they make a product, they care about the product being good, and they care about their reputation. Direct response guys who learn ads first, in general, tend to not be that way, because they can always go back to the bucket of the nameless masses and bring them in. Although I think scaling ads is a wonderful way to scale, just like building a brand and making content or outreach. They're all fine ways to scale. They're fine ways to advertise, let people know about your stuff. Many of you need to just look at yourselves in the mirror and think, is it worth making this money from someone else when I know I'm being dishonest?

23:59And that's a you question, because there's nothing that we can do that's going to like, there's not like, there's nothing we can do. Like your reputation is going to be your reputation. In all honesty, it's very low likelihood that this, my little talk right now is going to change anything. But I have this here more so, so I can say, I told you. With that being said, I think this is the reason marketers get a bad rap. And I do my very best to try and reverse at least part of that trend by being a better marketer and not marketing you guys. So that I can say like, no, education isn't a very important thing.

24:31And it's tough for me because I'm a product of this space. I bought lots of courses. I bought lots of conferences, masterminds, things like that. I bought a lot of them. I say this because like, it's, it's a space that's near and dear to my heart because it's how I learned what I, what I know. Obviously reality is the other teacher that I learned a lot from. And a lot of times these little things were things that would fill in the gaps. But I think part of it for me is that I never had big expectations of people. Some of the people that you sell to are naive. Here's a really good test. If your grandmother or someone who you care about was in your, in your marketplace, would you sell them?

25:09Like I I refer everyone I know to school because I think it's a great fucking product. That's why I did it to begin with. That's why I made the investment. That's why I'm here, right? Like I think it's a great product. But the thing is, it's a tool. It can't change who you are. And so we'll just amplify your ability to help people or hurt people. It's a platform. It would just mean a lot to me if the reputation of school was based on people who really helped a lot of people and priced their services according to value. and if you are if like the thing that you're actually good at is like you know how to like pickle mason jars and like store food then guess what a couple options option one is you can make your group free and then just sell jars and stuff like you don't have to you don't have to monetize the group like you can just sell you can make money other ways besides the actual media and the community within so point one the other point is that you might have a group that's like five bucks or eight bucks a month and that's fine is it going to be the same as getting to a hundred a thousand dollars a month or a million dollars a month?