WEBVTT 1 00:00:00.000 --> 00:00:05.200 What's going on? Welcome back to the game. We're talking about making my money, making my impact, 2 00:00:05.200 --> 00:00:10.880 and all of that fun stuff along the way. So today, I want to talk about creators. I want to talk 3 00:00:10.880 --> 00:00:16.000 about people who have audiences, and that could be in the form of email lists that can be 4 00:00:16.000 --> 00:00:20.560 form subscribers or followers, but fundamentally an audience of people who know I can trust you. 5 00:00:20.560 --> 00:00:25.120 I want to talk about the big mistake that I think a lot of creators or audience 6 00:00:25.120 --> 00:00:30.880 haveers make when attempting to monetize their audience. Now, I will probably make a different 7 00:00:30.880 --> 00:00:34.720 podcast at different time about what to sell if you're going to make your first offer to an audience. 8 00:00:34.720 --> 00:00:38.960 But for today, I want to talk about the actual mistake that occurs. And so if you have an audience 9 00:00:38.960 --> 00:00:44.560 or like to have one, this is a big one for you. And I will promise you this, which is once you see 10 00:00:44.560 --> 00:00:50.640 this, what I'm about to share with you, you will never be able to unsee it. If you listen to this 11 00:00:50.640 --> 00:00:54.880 and realize that, oh, shoot, this is me. I've made this mistake. The good news is you're just 12 00:00:54.880 --> 00:00:59.280 like everyone else. So don't worry about it. But you can take steps to unwind it, which I'll talk 13 00:00:59.280 --> 00:01:05.840 about as well. Okay. So here's the situation. So let's say we've got influencer, influencer X. 14 00:01:05.840 --> 00:01:13.040 All right. And he's got an audience of, let's say, backcountry red necks. Awesome. Cool. That's the 15 00:01:13.040 --> 00:01:20.320 audience. He decides, okay, I'm going to sell something to my audience. And so he sells widget number 16 00:01:20.320 --> 00:01:25.600 one. And so he launches widget number one. He's very excited about it. And we're going to assume 17 00:01:25.600 --> 00:01:31.120 that he did the basic math of, okay, what percentage of my audience will I convert? What's the lifetime 18 00:01:31.120 --> 00:01:35.840 gross profit per customer? And I want to maximize whatever object I have or whatever widget. 19 00:01:35.840 --> 00:01:39.520 If I'm looking at picking between four or five different widgets to the thing that will make, 20 00:01:39.520 --> 00:01:43.440 that will sell the most potential units at the highest lifetime gross profit per customer. 21 00:01:43.440 --> 00:01:47.280 All right. Let's just assume that you did that basic math, which by the way, if you did that basic 22 00:01:47.280 --> 00:01:50.640 math, it would put you in the advanced category because you'd be amazed at how many creators 23 00:01:50.640 --> 00:01:55.040 don't do basic math. Let's assume you did do basic math. And you do have widget number one. 24 00:01:55.040 --> 00:02:00.960 And it is doing reasonably well. The creator then gets the creative idea to take this wildly 25 00:02:00.960 --> 00:02:06.720 next step, which is, hey, Alex says, if having one product is good, having a second product 26 00:02:06.720 --> 00:02:11.120 must be better. I should do more, right? Isn't that what that is? More products? No, that would 27 00:02:11.120 --> 00:02:16.240 be new, by the way. Every, every sold yourself on your own idea, you sell yourself on your own 28 00:02:16.240 --> 00:02:19.840 BS. All of a sudden, everyone's quotes a line like, you know, obviously you read Biblical 29 00:02:19.840 --> 00:02:22.480 scripture and you're like, oh, this actually means I really should raise my prices. 30 00:02:22.480 --> 00:02:27.680 It's like particular activation, like everything now reminds you of that thing. So you then say, 31 00:02:27.680 --> 00:02:32.320 I'm going to look at my original list of things that I was thinking about selling when I decided 32 00:02:32.320 --> 00:02:37.200 to sell widget number one. And I'm going to pick from the remaining list to sell widget number two. 33 00:02:37.200 --> 00:02:42.160 Now, why are we doing this? We're doing this because the creator says, I want to make more money. 34 00:02:42.720 --> 00:02:46.640 And, you know, I already have a certain percentage of people who are buying thing one. So 35 00:02:46.640 --> 00:02:51.360 I'm going to sell them thing two. Duh, right? Makes sense. Obviously, we'll just sell them 36 00:02:51.360 --> 00:02:55.680 something else. There's two problems that occur. Problem number one is that widget number two, 37 00:02:55.680 --> 00:02:59.280 that you attempt to sell is typically the second best widget because you didn't pick it first. 38 00:02:59.280 --> 00:03:02.240 Now, you may make the argument, I have new information. I'll let a little bit more. This is 39 00:03:02.240 --> 00:03:06.320 actually would have been better one. Fine. Maybe. The second problem is that you've already made some 40 00:03:06.320 --> 00:03:10.480 sort of ask of the audience. And unless your product was exceptional, in which case, by the way, 41 00:03:10.480 --> 00:03:15.760 side quest, it's not an ask. If the thing you deliver on is exceptional, the problem is that the 42 00:03:15.760 --> 00:03:21.040 world has normalized myself included, the give-give-ask, the give-before-you-ask ratio, 43 00:03:21.600 --> 00:03:25.920 because honestly, I have to assume that most people suck at product. Most people's products are not 44 00:03:25.920 --> 00:03:32.400 that good. But in an ideal world, when people buy that product, the next time you have a product, 45 00:03:32.400 --> 00:03:37.920 they want to buy it even more. And so it doesn't seem like another ask. It seems like yet another 46 00:03:37.920 --> 00:03:42.640 give. People are going to upset if Apple comes out with another iPhone-esque product. Now, 47 00:03:42.640 --> 00:03:47.360 I want to be clear when I say iPhone-esque, I mean, new and amazing thing, not iPhone 28,000, 48 00:03:47.360 --> 00:03:52.720 you know, version, right? Hopefully, this won't sound self-aggrandizing. But if I came out with 49 00:03:52.720 --> 00:03:56.720 another book, and then at the day after the book, I said, hey, by the way, I have another book, 50 00:03:57.360 --> 00:04:01.040 the likelihood that people would buy the second, you know, the next book after that, 51 00:04:01.760 --> 00:04:05.840 if they enjoyed the first book or the one that I just, you know, they just did, maybe to make 52 00:04:05.840 --> 00:04:10.800 this realistic. Let's say I waited six months or waited three months to launch the next book. 53 00:04:10.800 --> 00:04:14.160 Then the likelihood is that people would just buy that one too because they got value from it. It 54 00:04:14.160 --> 00:04:19.120 doesn't feel like an ask. All right, so I make this as a clear point to differentiate this whole, 55 00:04:19.120 --> 00:04:24.240 or at least, add nuance or color to this concept of giving you an asking. Okay, back to the second 56 00:04:24.240 --> 00:04:29.120 widget. So you have your second widget, and it's not as good as your first widget, and you've already 57 00:04:29.120 --> 00:04:34.240 used up some cool goodwill. So you get a lower conversion on a lower widget. And so then, of course, 58 00:04:34.240 --> 00:04:36.800 you do this launch. It doesn't make as much as you want. It makes a little bit. And you're like, 59 00:04:36.800 --> 00:04:41.440 okay, but you know, it would really grow our business because I did this for a whole year now, 60 00:04:41.440 --> 00:04:44.560 because this is our second year, and I just finished my second year. Widget one was year one, 61 00:04:44.560 --> 00:04:48.560 widget two was year two. You know what I could do to this business? I think I could come up with 62 00:04:48.560 --> 00:04:54.400 a third widget to sell to my audience. Ah, a third widget, more products. And so you come up with 63 00:04:54.400 --> 00:04:59.120 a third widget. The same thing happens again. It's the third best thing to sell. You've already, 64 00:04:59.120 --> 00:05:03.920 you know, disenfranchise the highest buyers in your audience. And you go to a smaller conversion 65 00:05:03.920 --> 00:05:08.400 on a worse widget. And so it happens. It's like, let's say the first thing sells a hundred. 66 00:05:08.400 --> 00:05:12.640 And the second thing sells 50 and the third thing sells 30. You just have this like little, 67 00:05:12.640 --> 00:05:16.240 it's like you're dropping a marble and they just keep the little bounces get smaller and smaller. 68 00:05:16.240 --> 00:05:20.960 And so unfortunately, a lot of creators or people who have audiences will find this very vicious 69 00:05:20.960 --> 00:05:26.960 cycle of just like they keep launching stuff. What I want to explain is the fundamental mistake. 70 00:05:27.760 --> 00:05:35.600 Instead of trying to find new products to sell your audience, you want to find new audience 71 00:05:35.600 --> 00:05:44.320 to sell your product. I'll say that again. Instead of trying to figure out new products 72 00:05:44.320 --> 00:05:50.400 to sell your audience, you will likely be better served trying to find more audience to sell your 73 00:05:50.400 --> 00:05:57.440 product singular. What a lot of people who have audiences fail to realize is that all it does 74 00:05:57.440 --> 00:06:02.720 is give you an artificial boost in the beginning. You sell through the audience. Okay. And so it gives 75 00:06:02.720 --> 00:06:06.720 you an artificially inflated beginning. Now if that product isn't good or it's not recurring, 76 00:06:07.520 --> 00:06:10.400 then you're going to be in a little bit of world of hurt because now you're like, okay, 77 00:06:10.400 --> 00:06:14.560 well, what I do now now you have to make your regular call to actions and you sell kind of a 78 00:06:14.560 --> 00:06:20.960 maintenance level, which is purely predicated on the amount of new subscribers and followers 79 00:06:20.960 --> 00:06:25.360 you generate from your organic content on a regular basis. You then just know that you add 80 00:06:25.360 --> 00:06:29.760 call it 100 people a day to your following and you convert 1% or 2% of those followers and you get 81 00:06:29.760 --> 00:06:33.840 one or two sales a day depending on the price point. And that's it. That's the game. And then you 82 00:06:33.840 --> 00:06:37.600 get really sad because you're like, oh man, the launch was so big. Now it's not that big. So I 83 00:06:37.600 --> 00:06:42.400 should launch a second product. And of course, we know where that ends. I have seen so many influencer 84 00:06:42.400 --> 00:06:46.480 businesses that have like nine businesses that all make zero dollars. Not really. They make 85 00:06:46.480 --> 00:06:52.800 some money, right? But you think that in your infinite wisdom, you're going to somehow 86 00:06:52.800 --> 00:06:57.440 I'll compete every other person in the space that you have for each of those verticals 87 00:06:58.160 --> 00:07:03.040 because you just had one launch to your audience. And then of course, because sales aren't coming 88 00:07:03.040 --> 00:07:07.440 in the way they used to you over hired. And then you have to cut back there. And then of course, 89 00:07:07.440 --> 00:07:11.520 your reputation stuck first because it's not as good as it was before. There's also less excitement. 90 00:07:11.520 --> 00:07:15.040 But then you're like, well, I can't cut the team because some of the customers there, right? 91 00:07:15.040 --> 00:07:23.600 It's just a big mess. So what do you do? First things first is you recognize the fundamental 92 00:07:23.600 --> 00:07:29.600 truth that I just said, which is you likely need to find more audience to sell your product if you 93 00:07:29.600 --> 00:07:34.800 truly believe in the product rather than trying to find more products to sell your audience. 94 00:07:35.440 --> 00:07:39.760 If the product is good enough, it will expand beyond the audience because you have word of mouth. 95 00:07:39.760 --> 00:07:44.560 You will also be able to run advertisements to colder, colder traffic. And if done well, 96 00:07:45.360 --> 00:07:50.960 that product will actually bring you more or more audience. There's a reason, by the way, 97 00:07:50.960 --> 00:07:56.320 I spend so much time on the books. I know that a huge percentage of people actually find me 98 00:07:56.320 --> 00:08:01.920 through my books. Someone recommends the book to them at some random conference. They read the book. 99 00:08:01.920 --> 00:08:08.240 And then they follow my stuff. Then they enter my audience. And so the product actually creates 100 00:08:08.240 --> 00:08:12.880 audience members who then increases the likelihood that they purchase other future products from 101 00:08:12.880 --> 00:08:18.480 you in the future. And that is the point. It's more so that you only know and you have to recognize 102 00:08:18.480 --> 00:08:23.840 this as a skill deficiency. You only know one way to get customers. And you're probably also a 103 00:08:23.840 --> 00:08:28.400 little impatient. The inverse of that would be somebody who knows multiple ways to get customers 104 00:08:28.400 --> 00:08:34.080 and who is patient. It would then follow that you say, okay, I have this product that I believe 105 00:08:34.880 --> 00:08:38.240 it makes more sense instead of making a second product that I simply take all that effort make 106 00:08:38.240 --> 00:08:42.480 this product better. That's the back. And then the front, it makes more sense to instead of 107 00:08:42.480 --> 00:08:46.640 promoting a second product to that audience to try and make even better content to expand the 108 00:08:46.640 --> 00:08:51.680 audience and or run advertisements or do outbound or whatever your next would find affiliate partners 109 00:08:51.680 --> 00:08:56.560 that can send you more traffic, whatever it is, to expand my audience. And if the product is good, 110 00:08:57.200 --> 00:09:02.960 the product will reinforce your position, ideally positively, in your prospects. And then 111 00:09:02.960 --> 00:09:08.800 soon to be customer's minds. And I think this is like one of the fundamental mistakes. I mean, 112 00:09:08.800 --> 00:09:13.600 the reason I'm making this podcast, I saw some dude who I want to say like a couple of years ago, 113 00:09:13.600 --> 00:09:19.600 I had a, I don't say like low to medium following. It just launched service after service after service. 114 00:09:19.600 --> 00:09:25.040 It has like six different businesses now from an audience that now is is dwindling because 115 00:09:25.040 --> 00:09:29.600 the guy just sold everything that wasn't nailed to the floor he sold to him, right? And the stuff 116 00:09:29.760 --> 00:09:34.080 wasn't good. You know how I know it wasn't good. It couldn't be good. No one's good on their first 117 00:09:34.080 --> 00:09:38.720 shot, right? It takes so much effort to make a good product or good service. It takes years, 118 00:09:38.720 --> 00:09:44.640 it takes iterations. I think the real real is that if you do have that big audience, instead of 119 00:09:44.640 --> 00:09:50.240 fucking launching the whole thing, sell it to one to five percent of them. See what they say, 120 00:09:50.240 --> 00:09:54.720 get feedback, get some testimonials, improve the product again, sell it to another five percent 121 00:09:55.280 --> 00:10:02.080 right? You create this exclusionary process where you slowly rip up revenue. You add more people 122 00:10:02.080 --> 00:10:07.920 at the right pace and then you're able to basically grow into a sustainable revenue level 123 00:10:07.920 --> 00:10:13.600 that's significantly higher than the launch and then crash model. Now, you're like, wait a second, 124 00:10:13.600 --> 00:10:20.320 Alex, you launched your book. I sure did. Fundamentally, you have to be able to do a lot of execution 125 00:10:20.320 --> 00:10:24.080 at scale in order to pull this off. And I'm not saying, yeah, I guess I am saying, I think it's 126 00:10:24.080 --> 00:10:26.880 unlikely that you have the skill set on your team to be able to do this. And this is just me 127 00:10:26.880 --> 00:10:32.160 saying this from having met a lot of your teams. So yes, it takes operational skill and 128 00:10:32.880 --> 00:10:38.720 intelligence on your team to be able to pull this off on a consistent basis. But my launch was a book. 129 00:10:38.720 --> 00:10:42.720 I spent all my time into the book beforehand. I had high confidence that the book would be good. I 130 00:10:42.720 --> 00:10:46.800 already I've vetted it and vowed it with other readers that I know I trust their opinion, 131 00:10:46.800 --> 00:10:50.720 give me good feedback to make it simpler to make it streamlined to to cut out a relevant stories 132 00:10:50.720 --> 00:10:54.480 or parts that are like to advance or whatever it is, right? I don't see that process, 133 00:10:54.480 --> 00:10:59.280 that product iteration process from creators because they tend to be more marketing heavy, 134 00:10:59.280 --> 00:11:04.000 not product heavy. And this is obviously something that I've taken a long time in my career 135 00:11:04.000 --> 00:11:08.960 to recalibrate. I've spent a lot more time in the last call it four or five years old product 136 00:11:08.960 --> 00:11:13.680 because I realized once you know how to sell shit, once you know how to advertise, 137 00:11:14.240 --> 00:11:19.840 you realize how incredibly empty it is because you have to keep doing it again and again 138 00:11:19.840 --> 00:11:25.520 unless the products good. And so in the beginning, you suck at product and you suck at marketing. 139 00:11:25.520 --> 00:11:30.240 Then you learn how to market and sell and then you start selling stuff. But you realize how 140 00:11:30.240 --> 00:11:33.520 little leverage you have when you have to keep selling every month, you have to keep reloading, 141 00:11:33.520 --> 00:11:38.080 you have to keep hunting in the first every month to make your nut. And that's tough. It's I hate 142 00:11:38.720 --> 00:11:43.760 thinking about the amount of sales that I did 10 years ago that I don't get paid from today. 143 00:11:43.760 --> 00:11:48.640 And when I say get paid from, I just use that as loose hand for if I had had a better product 144 00:11:48.640 --> 00:11:52.960 at that point or I had consistently reinvested in that product, those people might still be with me now. 145 00:11:52.960 --> 00:11:58.240 And so the secret to very big businesses, here's the real real. The secret to very big businesses is 146 00:11:58.240 --> 00:12:03.120 just you don't lose customers because it's amazing how big a business can get even if it sells a 147 00:12:03.120 --> 00:12:08.320 small amount of customers, but doesn't lose them for 20 years. That's the real like that's how it 148 00:12:08.320 --> 00:12:13.440 works. And I'm shouting this a little bit because it just took me too long to get and a lot of these 149 00:12:13.440 --> 00:12:18.160 podcasts I just make to yell at my younger self just to be clear. And so you just got to figure 150 00:12:18.160 --> 00:12:24.240 that out. If you have an audience and you're trying to make more money with them, make the product 151 00:12:24.240 --> 00:12:29.440 as good as possible, consider slow ripping it instead of launching it so you can get to a sustainable 152 00:12:29.440 --> 00:12:35.040 level and then look at finding more audience rather than finding more products to sell your 153 00:12:35.040 --> 00:12:39.600 resisting people. And right now I'm telling you, you won't be able to unsee it. The amount of 154 00:12:39.600 --> 00:12:43.440 people who have like nine different products in their profile, you know what I mean, they've got, 155 00:12:43.440 --> 00:12:48.320 they've got, you know, five businesses, but they've got like seven employees. There's just stupid. 156 00:12:48.320 --> 00:12:55.120 It's just stupid. Just dumb. Just so dumb. But it's a novice mistake. It's a naive mistake. 157 00:12:55.120 --> 00:13:01.120 It's ADDs, entrepreneurial ADD. The thing is, is fortunately, unfortunately, it's super normal. 158 00:13:01.120 --> 00:13:07.200 I would say it's more common than it is not. You know, you get your rocks off ragging to people who 159 00:13:07.200 --> 00:13:10.720 don't know anything about business by saying that you own four companies. Anybody who does know 160 00:13:10.720 --> 00:13:14.720 anything about business is like, oh, this guy super distracted. novice entrepreneur, what I want. 161 00:13:15.680 --> 00:13:19.920 So, and the reality is that you also don't have four businesses. You're CEO of four businesses 162 00:13:19.920 --> 00:13:23.760 and you're running all of them, which means you can't run any one of them well. Also, while 163 00:13:23.760 --> 00:13:26.640 maintaining your media, which is probably the biggest part of your business, which you're spending all 164 00:13:26.640 --> 00:13:31.440 your time on. This is a bit of a cautionary tale. This is actually inspired by a real person that I 165 00:13:31.440 --> 00:13:36.320 saw and I ended up going into a deeper conversation about this and I was like, you know, I'm going to make 166 00:13:36.320 --> 00:13:40.480 a podcast about this because I think it's important. And so, if that's you, I need you to look at 167 00:13:40.480 --> 00:13:45.040 yourself deeply in the mirror and say, if I could only do one of these businesses, which one would 168 00:13:45.040 --> 00:13:49.760 it be? And if I took all the time I put into the other three companies and just made this one better, 169 00:13:49.760 --> 00:13:54.240 how much more money would I be making? And sometimes the answer to that question will make you feel sick 170 00:13:54.240 --> 00:14:00.320 to your stomach? Good. Change. Because at the end of the day, the whole process of entrepreneurship 171 00:14:00.320 --> 00:14:05.040 is the learning process. And yesterday is gone. There's nothing you can do about it. 172 00:14:05.680 --> 00:14:09.600 Fundamentally, it's sunk cost fallacy to keep something simply because you did it before. 173 00:14:09.600 --> 00:14:13.600 The only thing you can control is what you do today. The day you realize the better version of 174 00:14:13.600 --> 00:14:19.680 your business is the day you should act on it. Everything else is emotion. With that being said, 175 00:14:19.680 --> 00:14:25.600 maybe this is a very frightening podcast for some people. Maybe your boss has five businesses 176 00:14:25.600 --> 00:14:32.240 and has done the exact same thing, selling to the audience. The skill to solve for is focus, 177 00:14:33.200 --> 00:14:40.000 patience and learning to iterate on a product where I think create new products and to increase 178 00:14:40.000 --> 00:14:46.240 the size of your audience via making the existing channel better or bigger or finding a new channel 179 00:14:46.240 --> 00:14:50.000 altogether. And so if you're like, well, what do I do instead? Those are the four steps. 180 00:14:50.720 --> 00:14:56.320 Have an amazing rest of your day. Make money. Change the world. Go capitalism. All right. Back.