WEBVTT 1 00:00:00.000 --> 00:00:01.440 What is going on, everyone? 2 00:00:01.440 --> 00:00:03.600 I hope you're having a wacky Wednesday. 3 00:00:03.600 --> 00:00:04.520 I'm fired up today. 4 00:00:04.520 --> 00:00:06.040 I'm going to probably make a bunch of content 5 00:00:06.040 --> 00:00:08.040 because I've had like 10 straight days of events 6 00:00:08.040 --> 00:00:09.720 and I have all these questions that people were asking me 7 00:00:09.720 --> 00:00:11.320 over mine and little anecdotes that I shared 8 00:00:11.320 --> 00:00:12.240 that people found value in. 9 00:00:12.240 --> 00:00:14.760 So hopefully you don't mind me just sharing those things 10 00:00:14.760 --> 00:00:15.640 with you now. 11 00:00:15.640 --> 00:00:18.560 So the first two days, we're actually 12 00:00:18.560 --> 00:00:20.560 events that we attended and spoke at, which 13 00:00:20.560 --> 00:00:22.760 is at SAS Academy, Denmark, tells event. 14 00:00:22.760 --> 00:00:25.320 And I was fortunate enough to be at the speakers table, 15 00:00:25.320 --> 00:00:27.480 which was value in and of itself. 16 00:00:27.600 --> 00:00:30.960 And one of the people who was at the speakers table with me 17 00:00:30.960 --> 00:00:32.760 was a man named Marcus Rivera. 18 00:00:32.760 --> 00:00:36.840 He was Vista's former head of pricing, packaging, and product. 19 00:00:36.840 --> 00:00:39.520 So pretty much when they would acquire a company, 20 00:00:39.520 --> 00:00:41.160 he would be the guy that would go in 21 00:00:41.160 --> 00:00:44.640 and retool the entire kind of fulfillment structure 22 00:00:44.640 --> 00:00:47.280 who they were serving, how they would break down 23 00:00:47.280 --> 00:00:49.400 the levels of membership, et cetera. 24 00:00:49.400 --> 00:00:51.280 And so for those of you who don't know what Vista is, 25 00:00:51.280 --> 00:00:54.640 Vista is, I think the world's largest private equity 26 00:00:54.640 --> 00:00:56.480 firm for software. 27 00:00:56.480 --> 00:00:58.000 If you put their whole portfolio together, 28 00:00:58.000 --> 00:01:01.360 it's over 50, they do over 50 billion a year. 29 00:01:01.360 --> 00:01:03.680 There would be ranked third, I think, 30 00:01:03.680 --> 00:01:05.840 in the world, behind Facebook and Amazon. 31 00:01:05.840 --> 00:01:07.640 So for software companies. 32 00:01:07.640 --> 00:01:10.440 So they're really, really big, really, really smart. 33 00:01:10.440 --> 00:01:14.000 And I was fortunate enough to sit next to this guy for two days, 34 00:01:14.000 --> 00:01:16.120 which was awesome for me. 35 00:01:16.120 --> 00:01:20.000 And one thing became really clear when we were having dinner. 36 00:01:20.000 --> 00:01:24.440 And so they have something called Vista, which is Vista's SOP. 37 00:01:24.440 --> 00:01:27.400 So they're kind of their standard operating procedures. 38 00:01:27.400 --> 00:01:29.440 And these things are so closely guarded, 39 00:01:29.440 --> 00:01:32.960 you need like retinal scans and like you only get access 40 00:01:32.960 --> 00:01:35.680 to certain numbers of them if you're at certain levels. 41 00:01:35.680 --> 00:01:38.240 And then your access gets removed. 42 00:01:38.240 --> 00:01:39.560 It's like super top secret stuff. 43 00:01:39.560 --> 00:01:41.800 And this is literally how they create value, 44 00:01:41.800 --> 00:01:44.960 how they purchase companies, put their system on top, 45 00:01:44.960 --> 00:01:46.840 and then increase the value of that company. 46 00:01:46.840 --> 00:01:48.360 And so for them, their whole mantra 47 00:01:48.360 --> 00:01:50.120 is tripling their money in three years. 48 00:01:50.120 --> 00:01:51.560 So it's three and three. 49 00:01:51.560 --> 00:01:54.240 And so one of the things that he shared with me 50 00:01:54.240 --> 00:01:56.600 and obviously he couldn't share like the intricacies, 51 00:01:56.600 --> 00:01:59.320 but the concept was really, really powerful for me. 52 00:01:59.320 --> 00:02:02.280 And I'll tell you how we applied it at gym lunch. 53 00:02:02.280 --> 00:02:07.280 And so one of the things that most companies don't do 54 00:02:07.280 --> 00:02:09.200 is they don't score their leads, right? 55 00:02:09.200 --> 00:02:10.840 They don't score their prospects. 56 00:02:10.840 --> 00:02:12.600 They don't score their customers 57 00:02:12.600 --> 00:02:15.760 based on the value of that customer, right? 58 00:02:15.760 --> 00:02:20.200 And so scoring them can be based on a number of characteristics, 59 00:02:20.200 --> 00:02:23.600 behaviors, et cetera, that that person shows 60 00:02:24.320 --> 00:02:26.520 put them in a certain bucket, right? 61 00:02:26.520 --> 00:02:29.080 And what Vista does and what they count on 62 00:02:29.080 --> 00:02:31.200 is the fact that when they go into a company, 63 00:02:31.200 --> 00:02:33.640 when they're assessing a company in the diligence process, 64 00:02:33.640 --> 00:02:35.400 that they're going to learn more about that company 65 00:02:35.400 --> 00:02:37.240 than the founder and the people in that company 66 00:02:37.240 --> 00:02:38.360 even know about it. 67 00:02:38.360 --> 00:02:40.480 And so what they do is they parse out the data 68 00:02:40.480 --> 00:02:42.080 and they start trying to find the veins 69 00:02:42.080 --> 00:02:44.720 or the buckets of the most valuable customers. 70 00:02:44.720 --> 00:02:47.440 Once they find those buckets, that vein of customers 71 00:02:47.440 --> 00:02:49.880 that's more valuable, what they then do 72 00:02:49.880 --> 00:02:52.880 is they basically expand and focus on that vein 73 00:02:52.960 --> 00:02:54.040 of high LTV customers. 74 00:02:54.040 --> 00:02:55.840 Like it sounds simple. 75 00:02:55.840 --> 00:02:58.000 And one of the things that Marcus actually hit on a lot 76 00:02:58.000 --> 00:03:00.600 was like he's like, we stick to simple system, 77 00:03:00.600 --> 00:03:01.840 simple processes. 78 00:03:01.840 --> 00:03:04.800 And so when we, when I've like said things like 79 00:03:04.800 --> 00:03:05.920 the people who are the most advanced 80 00:03:05.920 --> 00:03:07.600 never don't do the fundamentals, 81 00:03:07.600 --> 00:03:09.960 I feel like I've seen this at like so many levels 82 00:03:09.960 --> 00:03:11.800 and seeing this from probably, you know, 83 00:03:11.800 --> 00:03:13.280 the biggest and probably biggest, you know, 84 00:03:13.280 --> 00:03:16.680 software turnaround increasing value company out there 85 00:03:16.680 --> 00:03:17.720 is pretty cool. 86 00:03:17.720 --> 00:03:20.520 And so let me tell you what we did 87 00:03:20.520 --> 00:03:22.160 to kind of go through this process. 88 00:03:22.160 --> 00:03:24.240 And so Marcus was explaining that 89 00:03:24.240 --> 00:03:25.920 they don't even just do it for customers. 90 00:03:25.920 --> 00:03:30.080 They do it for prospects, opportunities and customers. 91 00:03:30.080 --> 00:03:31.880 So three different segments, 92 00:03:31.880 --> 00:03:36.400 they're going to look and score at each part of the pipeline, 93 00:03:36.400 --> 00:03:37.920 all right, using the analytics that they have 94 00:03:37.920 --> 00:03:38.760 and the teams that they do. 95 00:03:38.760 --> 00:03:41.200 Now you're like, okay, cool, that's awesome, Alex. 96 00:03:41.200 --> 00:03:43.440 How does this make more money at my gym? 97 00:03:43.440 --> 00:03:45.520 And so let me tell you how we're applying it right now. 98 00:03:45.520 --> 00:03:48.960 And so what we did is we took the last 90 days, 99 00:03:48.960 --> 00:03:52.840 I think it was July, July, August, September. 100 00:03:52.840 --> 00:03:54.760 Or maybe it was September, I think, 101 00:03:54.760 --> 00:03:56.280 yeah, I think it was July, August, September. 102 00:03:56.280 --> 00:03:59.600 So we took a 90 day block of time 103 00:03:59.600 --> 00:04:01.440 and we looked at all of our exits, 104 00:04:01.440 --> 00:04:04.280 all of our escalations with the people 105 00:04:04.280 --> 00:04:06.160 who kind of stuck the most, 106 00:04:06.160 --> 00:04:07.640 our people who didn't get the most results, 107 00:04:07.640 --> 00:04:09.040 whatever we want to put it. 108 00:04:09.040 --> 00:04:11.520 The people were the hardest to serve 109 00:04:11.520 --> 00:04:14.120 and who got the least results using our program. 110 00:04:14.120 --> 00:04:17.240 And then we looked at the conversation, 111 00:04:17.240 --> 00:04:18.080 the reverse of that. 112 00:04:18.080 --> 00:04:20.120 All the characteristics of the people who made the most money, 113 00:04:20.120 --> 00:04:21.680 who got the highest returns, 114 00:04:21.680 --> 00:04:24.520 who were the easiest to work with, right? 115 00:04:24.520 --> 00:04:27.680 And so what we found, here's some unsurprising facts. 116 00:04:28.720 --> 00:04:30.920 If you are not a gym owner, right, 117 00:04:30.920 --> 00:04:33.160 you don't do as well as people who are gym owners. 118 00:04:33.160 --> 00:04:35.480 Crazy, crazy facts, right? 119 00:04:35.480 --> 00:04:39.240 And we also learn that if you are not full time in your gym 120 00:04:39.240 --> 00:04:40.680 and you have a job outside 121 00:04:40.680 --> 00:04:42.960 and you're trying to do a gym as a side hustle or something, 122 00:04:42.960 --> 00:04:44.040 you don't do as well as people 123 00:04:44.040 --> 00:04:46.360 who are fully committed to their gym. 124 00:04:46.360 --> 00:04:49.560 If you don't have a signed lease or a building of your own, 125 00:04:49.560 --> 00:04:52.880 you don't do as well as someone who has a building of their own, right? 126 00:04:52.880 --> 00:04:55.120 And if you don't have any employees, 127 00:04:55.120 --> 00:04:57.160 it's harder for you to do this 128 00:04:57.160 --> 00:04:59.120 mostly because there's a huge time constraint, right? 129 00:04:59.120 --> 00:05:02.000 Like it takes effort to implement new systems 130 00:05:02.000 --> 00:05:04.040 because not only do you have to keep your existing business going, 131 00:05:04.040 --> 00:05:05.960 you have to start working on top of that 132 00:05:05.960 --> 00:05:08.240 in order to dig yourself out of the hole, right? 133 00:05:08.240 --> 00:05:10.000 And so when we found those characteristics, 134 00:05:10.000 --> 00:05:14.280 what we started doing is we started filtering and qualifying our front end. 135 00:05:14.320 --> 00:05:17.200 And so we started doing this for the month of October, all right? 136 00:05:17.200 --> 00:05:20.360 So we took the 90 days, we took the findings, 137 00:05:20.360 --> 00:05:22.320 and then we implemented it for the month of October, right? 138 00:05:22.320 --> 00:05:25.120 Now we're in November and what's crazy is this 139 00:05:26.160 --> 00:05:28.720 from the previous four weeks. 140 00:05:28.720 --> 00:05:31.160 So in September, the last four weeks, 141 00:05:31.160 --> 00:05:34.320 compared to after we started doing this qualification, 142 00:05:34.320 --> 00:05:37.320 here's two crazy numbers I'm going to share with you. 143 00:05:37.320 --> 00:05:40.800 One is once we qualify prospects that they had to have, 144 00:05:40.800 --> 00:05:42.920 at least 25 clients, they had to have a signed lease, 145 00:05:42.920 --> 00:05:45.200 they had to be a full time gym owner, right? 146 00:05:45.200 --> 00:05:46.680 And ideally, this was optional, 147 00:05:46.680 --> 00:05:50.040 but ideally have one employee or more who worked with them 148 00:05:50.040 --> 00:05:51.640 so that they could share the load 149 00:05:51.640 --> 00:05:53.640 and so that they could actually focus more in selling 150 00:05:53.640 --> 00:05:56.120 and work with leads, et cetera. 151 00:05:56.120 --> 00:05:59.320 When we looked at the after effect of that, 152 00:05:59.320 --> 00:06:03.840 our sales decreased from over 100 a month 153 00:06:03.840 --> 00:06:06.800 in terms of gyms to about 40 to 50, right? 154 00:06:06.800 --> 00:06:08.440 Now here's where it gets interesting, all right? 155 00:06:08.440 --> 00:06:12.640 So that cut our inflow in half by qualifying our customers, right? 156 00:06:13.080 --> 00:06:14.440 By really making sure that the people 157 00:06:14.440 --> 00:06:16.240 are coming in, we're the best fit 158 00:06:16.240 --> 00:06:18.160 who could serve the best, right? 159 00:06:18.160 --> 00:06:19.480 Here's what's cool on our side now 160 00:06:19.480 --> 00:06:21.760 that we've done this in the first four weeks. 161 00:06:21.760 --> 00:06:24.560 In the four week period, since then, 162 00:06:24.560 --> 00:06:28.400 the people who started after those qualifications, 163 00:06:28.400 --> 00:06:33.400 we've had zero escalations from those people. 164 00:06:33.800 --> 00:06:37.880 Prior to that, we had 22 escalations 165 00:06:37.880 --> 00:06:42.200 as in people who were having issues, whatever it is, 166 00:06:42.200 --> 00:06:44.920 you know what I mean, just red flags, right? 167 00:06:44.920 --> 00:06:46.760 The prior four weeks. 168 00:06:46.760 --> 00:06:49.480 So from 22 to zero, 169 00:06:49.480 --> 00:06:52.680 now think how crazy this is in terms of scaling a business 170 00:06:52.680 --> 00:06:55.880 and operational complexity as you go up, right? 171 00:06:55.880 --> 00:06:58.960 So we had this huge vein of people 172 00:06:58.960 --> 00:07:02.200 who were taking up the vast majority of my team's time 173 00:07:02.200 --> 00:07:05.160 and were actually worth less, right? 174 00:07:05.160 --> 00:07:08.080 They made less, they were worth less to us. 175 00:07:08.080 --> 00:07:09.760 And so when you're thinking about scaling 176 00:07:09.760 --> 00:07:13.040 and maintaining operational efficiency and profit, 177 00:07:13.040 --> 00:07:14.560 if you're looking at the customers 178 00:07:14.560 --> 00:07:18.400 that are the highest lifetime value, the best customers, right? 179 00:07:18.400 --> 00:07:20.160 And here's what's crazy. 180 00:07:20.160 --> 00:07:23.000 The people, so after that October date, 181 00:07:23.000 --> 00:07:24.920 we switched back to the defined end program, 182 00:07:24.920 --> 00:07:26.760 which is what we did for three years. 183 00:07:26.760 --> 00:07:30.000 So we did a brief stint where we basically signed 184 00:07:30.000 --> 00:07:31.800 people up for a year upfront 185 00:07:31.800 --> 00:07:33.160 because we wanted to give them everything. 186 00:07:33.160 --> 00:07:35.440 It was a trial, we did a 90 day sprint. 187 00:07:35.440 --> 00:07:37.560 And it turned out that that didn't work nearly 188 00:07:37.560 --> 00:07:38.800 as well as having to find it. 189 00:07:38.840 --> 00:07:40.160 And it's kind of the same way we run the gyms. 190 00:07:40.160 --> 00:07:41.760 It's like having a defined end program 191 00:07:41.760 --> 00:07:44.360 tends to be a little bit easier for people to run their hands 192 00:07:44.360 --> 00:07:46.240 around, a little more defined in terms of the skills 193 00:07:46.240 --> 00:07:48.160 that they need to acquire, et cetera. 194 00:07:48.160 --> 00:07:49.400 But what's interesting is that the people 195 00:07:49.400 --> 00:07:52.600 who came back in were actually paying more 196 00:07:52.600 --> 00:07:57.360 than the people who were paying more than the people 197 00:07:57.360 --> 00:07:59.640 who we were letting them before. 198 00:07:59.640 --> 00:08:03.120 So this new vein of customer who's higher qualified 199 00:08:03.120 --> 00:08:08.120 is paying more, is making more requires less work. 200 00:08:08.400 --> 00:08:11.640 Now that sounds like a recipe for a higher profit business. 201 00:08:11.640 --> 00:08:14.720 It also sounds like a recipe for better, happier customers. 202 00:08:14.720 --> 00:08:16.840 And so also what happens if you think about it 203 00:08:16.840 --> 00:08:20.120 for a reputation standpoint is like if you lower the bar 204 00:08:20.120 --> 00:08:22.400 too much, then what happens is you bring in people 205 00:08:22.400 --> 00:08:24.120 who are not qualified, right? 206 00:08:24.120 --> 00:08:25.960 They take up more of your team's time, 207 00:08:25.960 --> 00:08:28.640 they cost you tons of effort, 208 00:08:28.640 --> 00:08:31.880 and they're not making as much, which means that then 209 00:08:31.880 --> 00:08:34.560 they say like your thing is not as good, right? 210 00:08:34.560 --> 00:08:37.440 When in reality it might just not be as good for them, right? 211 00:08:37.440 --> 00:08:40.120 Which makes sense, it makes intuitive sense. 212 00:08:40.120 --> 00:08:42.840 And so I just like sharing these mistakes 213 00:08:42.840 --> 00:08:45.240 slash learns with you so that maybe I can look back 214 00:08:45.240 --> 00:08:46.320 on this 10 years from now and be like, 215 00:08:46.320 --> 00:08:48.920 hey, I remember when we started doing that. 216 00:08:48.920 --> 00:08:51.240 But now what our focus is is cool. 217 00:08:51.240 --> 00:08:53.720 We know who the best customers for us are, 218 00:08:53.720 --> 00:08:55.840 and it's like, dear God, why did this take us three years 219 00:08:55.840 --> 00:09:00.320 to do this, learn from my stupidity, 220 00:09:00.320 --> 00:09:02.560 hopefully you can start doing this with your own stuff. 221 00:09:02.560 --> 00:09:04.920 And now we're just gonna focus and double it down 222 00:09:04.920 --> 00:09:08.240 on that vein of customers and try and expand that, 223 00:09:08.240 --> 00:09:11.320 and really focusing on them in multiple platforms, right? 224 00:09:11.320 --> 00:09:12.320 And so, 225 00:09:15.640 --> 00:09:18.480 Hey, if you're a return listener and you have not rated 226 00:09:18.480 --> 00:09:19.640 or reviewed the show, 227 00:09:19.640 --> 00:09:22.120 I want you to know that you should feel absolutely terrible 228 00:09:22.120 --> 00:09:24.760 about yourself and everything else in the world I'm kidding. 229 00:09:24.760 --> 00:09:26.160 But it would mean the absolute words to me, 230 00:09:26.160 --> 00:09:27.400 if you guys would go ahead and do that, 231 00:09:27.400 --> 00:09:28.400 and you don't even have to pause to show you, 232 00:09:28.400 --> 00:09:30.040 keep listening and you can just do it with your thumb right now, 233 00:09:30.040 --> 00:09:31.200 it'll take you less than 60 seconds. 234 00:09:31.200 --> 00:09:33.840 And like I said, the only way that podcast grows 235 00:09:33.840 --> 00:09:34.920 through word of mouth, 236 00:09:34.920 --> 00:09:37.200 and this is you joining hands with me, 237 00:09:37.200 --> 00:09:38.800 and helping as many entrepreneurs as we possibly can, 238 00:09:38.800 --> 00:09:41.400 because no one is coming to save us, it's just us. 239 00:09:41.400 --> 00:09:42.840 All right, so please go do that now, 240 00:09:42.840 --> 00:09:44.040 and let's get back to the show. 241 00:09:47.640 --> 00:09:51.000 I say this to say, if Vista has repeatedly, 242 00:09:51.000 --> 00:09:52.080 you know, been able to go from, 243 00:09:52.080 --> 00:09:54.320 I mean, they're not a super old firm, 244 00:09:54.320 --> 00:09:55.520 you know, from basically nothing, 245 00:09:55.520 --> 00:09:57.840 all the way to 50 billion in a very short period of time, 246 00:09:57.840 --> 00:10:02.760 it's because they know how to extract and amplify value. 247 00:10:02.880 --> 00:10:04.920 And the biggest thing is not, I mean, 248 00:10:04.920 --> 00:10:06.680 they do sure, they tweak the pricing, 249 00:10:06.680 --> 00:10:08.320 they find the right buckets, et cetera, 250 00:10:08.320 --> 00:10:10.880 but they do that by analyzing the customers 251 00:10:10.880 --> 00:10:13.160 better than the business that they're purchasing, 252 00:10:13.160 --> 00:10:15.120 even knows their own customers. 253 00:10:15.120 --> 00:10:16.800 And so I've challenged you, 254 00:10:16.800 --> 00:10:18.600 now this may sound like super unlucky, 255 00:10:18.600 --> 00:10:21.840 but it's not, all you have to do is look over the last three months, 256 00:10:21.840 --> 00:10:24.440 okay, look at the people who left your business, all right, 257 00:10:24.440 --> 00:10:26.240 and this is where you get the best data 258 00:10:26.240 --> 00:10:27.800 from all the people who leave, all right, 259 00:10:27.800 --> 00:10:30.760 so look at the data from people who left your business, 260 00:10:30.760 --> 00:10:34.600 trying to think about as many character traits as you possibly can, 261 00:10:34.600 --> 00:10:38.400 what's their age, what's their job, 262 00:10:38.400 --> 00:10:40.160 what are their goals, what do they sign up for, 263 00:10:40.160 --> 00:10:43.080 how much money down did they start with, 264 00:10:43.080 --> 00:10:46.720 what did they sign up for in terms of their continuity, et cetera? 265 00:10:46.720 --> 00:10:49.600 And if you can piece those things together, 266 00:10:49.600 --> 00:10:55.240 then you're gonna get a really good idea of who the good customers are 267 00:10:55.240 --> 00:10:56.560 and who the back customers are. 268 00:10:56.600 --> 00:10:59.480 And it's okay to have a stern line 269 00:10:59.480 --> 00:11:00.920 because we're doing this now. 270 00:11:00.920 --> 00:11:02.800 Now the thing is, in the short term, 271 00:11:02.800 --> 00:11:04.880 you can be like, oh my gosh, my inflow cut in half. 272 00:11:04.880 --> 00:11:08.040 But so did all my operational overhead 273 00:11:08.040 --> 00:11:12.800 and the issues that all the work that the team had to put together 274 00:11:12.800 --> 00:11:16.880 to try and service these people who were not necessarily the best fit, right? 275 00:11:16.880 --> 00:11:19.320 And so I share that with you, 276 00:11:19.320 --> 00:11:22.160 and I'll give you one more tidbit that I learned from him. 277 00:11:22.160 --> 00:11:25.040 And so we learned this from the whole event, 278 00:11:25.040 --> 00:11:26.840 which we took as a huge takeaway for us 279 00:11:26.840 --> 00:11:28.600 that you can totally apply to your gym, 280 00:11:28.600 --> 00:11:31.400 is that customers in a recurring-based business 281 00:11:31.400 --> 00:11:35.000 or really any business decide whether they're going to stay 282 00:11:35.000 --> 00:11:38.680 at two points in the beginning of your life cycle, all right? 283 00:11:38.680 --> 00:11:42.440 Between the sale and when they start getting the thing, right? 284 00:11:42.440 --> 00:11:44.920 The service, the product, the whatever. 285 00:11:44.920 --> 00:11:49.440 And once they start using the product, 286 00:11:49.440 --> 00:11:51.600 the implementation are on-boarding period. 287 00:11:51.600 --> 00:11:53.560 So in that period, 288 00:11:53.560 --> 00:11:56.240 so if you're doing an orientation with your clients, right? 289 00:11:56.240 --> 00:11:57.840 They buy something, all right? 290 00:11:57.840 --> 00:11:59.880 The time between the purchase 291 00:11:59.880 --> 00:12:02.520 and when they start getting the thing, which be orientation, 292 00:12:02.520 --> 00:12:05.320 and the actual orientation itself 293 00:12:05.320 --> 00:12:07.680 is typically when people are already making the decision 294 00:12:07.680 --> 00:12:12.440 of whether they're going to stay with you in the long long, all right? 295 00:12:12.440 --> 00:12:15.240 Which means, if right now, 296 00:12:15.240 --> 00:12:17.920 you just think your orientation is an aftermath. 297 00:12:17.920 --> 00:12:21.000 It's like, oh yeah, now we have to fulfill that thing we sold. 298 00:12:21.000 --> 00:12:22.480 You're screwed, right? 299 00:12:22.480 --> 00:12:25.520 You're getting by just on the fact that you have enough volume 300 00:12:25.520 --> 00:12:28.080 in the door, but you're losing massive amounts of money 301 00:12:28.080 --> 00:12:31.920 by not making that completely choreographed experience 302 00:12:31.920 --> 00:12:35.640 that you're really focusing on over-delivering a value. 303 00:12:35.640 --> 00:12:39.160 And the way to do that is to demonstrate the skills 304 00:12:39.160 --> 00:12:42.200 that they're going to need to be able to use 305 00:12:42.200 --> 00:12:43.960 to use your services, right? 306 00:12:43.960 --> 00:12:47.040 And so whether that, not just saying, hey, yeah, 307 00:12:47.040 --> 00:12:49.560 you should download this app, yeah, yeah, you'll figure it out, 308 00:12:49.560 --> 00:12:52.560 but actually doing it with them, holding their hand, 309 00:12:52.560 --> 00:12:55.360 and then having them duplicate the process 310 00:12:55.360 --> 00:12:58.320 so that you can see that you've transferred the skill to them 311 00:12:58.320 --> 00:13:01.200 so that they now know, and they are self-sufficient 312 00:13:01.200 --> 00:13:04.280 in being able to consume your services, right? 313 00:13:04.280 --> 00:13:07.480 And so if your onboarding is rushed, right? 314 00:13:07.480 --> 00:13:10.880 Your orientation is rushed, then expand the time period 315 00:13:10.880 --> 00:13:13.440 because it's going to massively multiply the lifetime value 316 00:13:13.440 --> 00:13:15.120 of that customer in the likelihood 317 00:13:15.120 --> 00:13:16.800 that they're going to stay with you. 318 00:13:16.800 --> 00:13:18.400 So this is one of those few times 319 00:13:18.400 --> 00:13:22.520 where you don't want to be lazy and not deliberate 320 00:13:22.520 --> 00:13:25.600 and intentional in how you're onboarding the customer 321 00:13:25.600 --> 00:13:27.040 after you complete the sale. 322 00:13:27.040 --> 00:13:28.880 So the communication that you have with them 323 00:13:28.880 --> 00:13:30.640 immediately after the sale, which is like 324 00:13:30.640 --> 00:13:33.800 sending them a personalized video, giving them swag, 325 00:13:33.800 --> 00:13:35.360 maybe a letter, whatever it is, 326 00:13:35.360 --> 00:13:37.080 definitely texting them between the time 327 00:13:37.080 --> 00:13:39.320 that they make the sale or you make the sale 328 00:13:39.320 --> 00:13:41.240 and when they start the onboarding. 329 00:13:41.240 --> 00:13:43.680 And the second piece I'm already going back to the beginning 330 00:13:43.680 --> 00:13:45.440 is the sale itself. 331 00:13:45.440 --> 00:13:48.440 And so what we're learning internally for us at gym lunch 332 00:13:48.440 --> 00:13:50.320 and this may seem obvious, but maybe I'm sharing it 333 00:13:50.320 --> 00:13:51.880 with you because we're learning it too, 334 00:13:51.880 --> 00:13:54.800 is that expectations are everything, right? 335 00:13:54.800 --> 00:13:56.600 Expectations are everything. 336 00:13:56.600 --> 00:13:58.520 And if you set proper expectations 337 00:13:58.520 --> 00:14:00.400 for what is going to happen next 338 00:14:00.400 --> 00:14:02.600 and then you fulfill that beautifully, 339 00:14:02.600 --> 00:14:05.080 your trust with the prospect goes up. 340 00:14:05.080 --> 00:14:07.400 Now here's where it can get tricky, right? 341 00:14:07.400 --> 00:14:09.120 And this is what we call selling hot. 342 00:14:09.120 --> 00:14:12.440 It's where you set expectations so high, 343 00:14:12.440 --> 00:14:14.600 it's impossible for you to ever fulfill 344 00:14:14.600 --> 00:14:18.720 or for you to hit that with the majority of customers, right? 345 00:14:18.720 --> 00:14:23.000 And so this is where selling towards behavior 346 00:14:23.000 --> 00:14:25.160 and selling towards sustainability 347 00:14:25.160 --> 00:14:28.000 and long-term change comes really into play 348 00:14:28.000 --> 00:14:31.280 so that you can shift and break the beliefs of your prospect 349 00:14:31.280 --> 00:14:33.880 to shifting their time frame to what is really going 350 00:14:33.880 --> 00:14:37.480 to be beneficial for them rather than simply trying 351 00:14:37.480 --> 00:14:39.920 to sell them to say yes, right? 352 00:14:39.920 --> 00:14:43.640 And so an example of this is for us, 353 00:14:43.640 --> 00:14:46.240 if someone has only consumes testimonial 354 00:14:46.240 --> 00:14:48.200 and we've changed this in our marketing, 355 00:14:48.200 --> 00:14:50.040 we've changed this in our testimonials, 356 00:14:50.040 --> 00:14:53.240 we've changed it in the posts that we tag people in, 357 00:14:53.240 --> 00:14:56.400 is that we're really no longer focused on saying like, 358 00:14:56.400 --> 00:14:59.560 hey, look at these 10 people who made a hundred grand 359 00:14:59.560 --> 00:15:01.680 in their first six weeks with us, right? 360 00:15:01.680 --> 00:15:02.680 We have those, right? 361 00:15:02.680 --> 00:15:03.880 We totally do. 362 00:15:03.880 --> 00:15:06.720 But the thing is is like, but what are the averages, right? 363 00:15:06.720 --> 00:15:09.960 And so now we just share what the average gym does, right? 364 00:15:09.960 --> 00:15:12.640 And it's significantly less appealing. 365 00:15:12.640 --> 00:15:14.160 I think the average gym right now is like, 366 00:15:14.160 --> 00:15:17.560 they do 16,000 in their first six weeks with us, right? 367 00:15:17.560 --> 00:15:20.600 Now that's a lot, but it's not a hundred grand 368 00:15:20.600 --> 00:15:23.720 in your first month and showing what the average gyms 369 00:15:23.720 --> 00:15:26.160 are getting in terms of lead costs and lead flow 370 00:15:26.160 --> 00:15:28.840 gives people at least an average understanding 371 00:15:28.840 --> 00:15:30.280 and we can explain to the person that means 372 00:15:30.280 --> 00:15:33.120 that half the people who sign up get less than this, right? 373 00:15:33.120 --> 00:15:34.520 This is the average. 374 00:15:34.520 --> 00:15:39.520 And so that way, if you, if and when you do go above that mark, 375 00:15:40.000 --> 00:15:43.200 then their expectations are reasonable 376 00:15:43.200 --> 00:15:45.960 and you can over-deliver, right? 377 00:15:45.960 --> 00:15:49.000 And in an ideal world, you would probably try and sell 378 00:15:49.000 --> 00:15:53.400 on the bottom 25% of results so that the expectations 379 00:15:53.400 --> 00:15:57.160 are so low that everyone is excited about the fact 380 00:15:57.160 --> 00:16:01.080 that they're over-achieving from that baseline 381 00:16:01.080 --> 00:16:02.400 that you have set for them. 382 00:16:02.400 --> 00:16:04.800 And so what I'm like, I'm continuing to learn in this. 383 00:16:04.800 --> 00:16:07.680 I want to write like a whole presentation of expectations. 384 00:16:07.680 --> 00:16:11.160 But expectation management is everything, right? 385 00:16:11.160 --> 00:16:15.440 It's amazing what happens if you set really high expectations 386 00:16:15.440 --> 00:16:19.120 and like this is where someone makes $20,000 387 00:16:19.120 --> 00:16:23.200 in their first month and is disappointed with gym lunch 388 00:16:23.200 --> 00:16:25.440 and we've had this happen plenty of times, right? 389 00:16:25.440 --> 00:16:26.640 They're like, well, this sucks. 390 00:16:26.640 --> 00:16:28.480 I thought I was gonna do better, right? 391 00:16:28.480 --> 00:16:32.640 When in reality, that's fucking amazing, right? 392 00:16:32.640 --> 00:16:34.240 In terms of the big scheme. 393 00:16:34.240 --> 00:16:36.360 Now, maybe this resonates with you 394 00:16:36.360 --> 00:16:39.280 because you've had someone who loses five pounds 395 00:16:39.280 --> 00:16:42.640 in their first 14 days with you and they're disappointed. 396 00:16:42.640 --> 00:16:44.400 Now, why would they be disappointed? 397 00:16:44.400 --> 00:16:47.360 Only one reason because the expectations that were set 398 00:16:47.360 --> 00:16:50.040 for them in the sale and in the orientation 399 00:16:50.040 --> 00:16:52.920 were too high for the average person 400 00:16:52.920 --> 00:16:54.840 and then most people are disappointed 401 00:16:54.840 --> 00:16:56.960 with what would otherwise be considered 402 00:16:56.960 --> 00:16:58.800 an amazing great start. 403 00:16:58.800 --> 00:17:01.240 And so if you can reset the expectations 404 00:17:01.240 --> 00:17:04.760 that are being put on the customer in the sale, right? 405 00:17:04.760 --> 00:17:07.680 And you sell around the fact, not around, 406 00:17:07.680 --> 00:17:09.880 you sell through the fact and you break the belief around 407 00:17:09.880 --> 00:17:12.600 what the expectation should be in a short and long term vision 408 00:17:12.600 --> 00:17:14.600 so that you could shift their expectations 409 00:17:14.600 --> 00:17:17.720 towards long term change and a process and behavior change 410 00:17:17.720 --> 00:17:19.720 so that they can ultimately achieve what they want 411 00:17:19.720 --> 00:17:22.480 which is being fit forever, not fit for the next six weeks 412 00:17:22.480 --> 00:17:24.360 or six months, right? 413 00:17:24.360 --> 00:17:27.280 And so all that to say, the big takeaways 414 00:17:27.280 --> 00:17:29.560 that we have at gym launches that we are now 415 00:17:29.560 --> 00:17:32.000 heavily qualifying people on the front end 416 00:17:32.000 --> 00:17:33.880 so that we have longer lifetime value, 417 00:17:33.880 --> 00:17:35.360 we have superior client outcomes, 418 00:17:35.360 --> 00:17:37.320 we have less operational complexity 419 00:17:37.320 --> 00:17:39.760 because these people have the right characteristics 420 00:17:39.760 --> 00:17:41.200 of people who are successful, 421 00:17:41.200 --> 00:17:43.920 both externally in terms of what they have their gym 422 00:17:43.920 --> 00:17:46.720 but internally in terms of how they work 423 00:17:46.720 --> 00:17:50.040 and what level of effort they're willing to put into 424 00:17:50.040 --> 00:17:51.560 be successful, right? 425 00:17:51.560 --> 00:17:52.920 We found out that watch printers 426 00:17:52.920 --> 00:17:55.640 are not a very good demographic for us 427 00:17:55.640 --> 00:17:57.880 and so it's like, cool, we're not gonna service them, right? 428 00:17:57.880 --> 00:18:00.200 Or not gonna service them in this way, 429 00:18:00.200 --> 00:18:03.960 maybe we'll create an info product that's less for them 430 00:18:03.960 --> 00:18:06.320 so that they can go through it at their own leisure 431 00:18:06.320 --> 00:18:07.800 or their own time frame 432 00:18:07.800 --> 00:18:09.400 rather than the intense time frame 433 00:18:09.400 --> 00:18:12.840 that we put onto people when they start gym launch 434 00:18:12.840 --> 00:18:15.520 because it's really like ready fire, go, 435 00:18:15.520 --> 00:18:18.040 you have 72 hours and leaves are starting to come in, right? 436 00:18:18.040 --> 00:18:19.560 And that's how we do things at gym launch 437 00:18:19.560 --> 00:18:21.200 because that's how I am, right? 438 00:18:22.160 --> 00:18:24.960 But we have now used this on the qualification side 439 00:18:24.960 --> 00:18:27.600 and then also how our salespeople are tagging 440 00:18:27.600 --> 00:18:29.000 and setting expectations 441 00:18:29.160 --> 00:18:30.760 and then being extremely deliberate 442 00:18:30.760 --> 00:18:32.440 and we're still working on this 443 00:18:32.440 --> 00:18:34.440 in making the onboarding and implementation 444 00:18:34.440 --> 00:18:35.920 even more choreographed 445 00:18:35.920 --> 00:18:38.560 and we have a pretty darn choreographed orientation process 446 00:18:38.560 --> 00:18:42.800 but even better, even more reinforced, even simpler 447 00:18:42.800 --> 00:18:44.800 so that the handoff is seamless 448 00:18:44.800 --> 00:18:47.240 so that everyone knows exactly what is going to happen 449 00:18:47.240 --> 00:18:48.280 before it happens 450 00:18:48.280 --> 00:18:51.240 and then they know exactly what is going to happen next 451 00:18:51.240 --> 00:18:52.360 in their experience with us 452 00:18:52.360 --> 00:18:54.720 and so you can use all these lessons 453 00:18:54.720 --> 00:18:57.240 that we're learning right now in your business 454 00:18:57.240 --> 00:18:59.760 so that you can increase the quality of the customer, 455 00:18:59.760 --> 00:19:01.480 set the expectations properly 456 00:19:01.480 --> 00:19:03.920 and then over deliver on the expectations that you've set 457 00:19:03.920 --> 00:19:05.440 so that they can make the decision 458 00:19:05.440 --> 00:19:07.360 in the first two or three meetings with you 459 00:19:07.360 --> 00:19:09.400 that they're gonna stick with you for the long long. 460 00:19:09.400 --> 00:19:10.960 So I hope this was valuable for you. 461 00:19:10.960 --> 00:19:14.520 Like it, drop a comment, drop a review 462 00:19:14.520 --> 00:19:16.520 if you're listening to this on the podcast 463 00:19:16.520 --> 00:19:19.880 and as usual, if you want some free goodies 464 00:19:19.880 --> 00:19:22.000 you can download them somewhere. 465 00:19:22.000 --> 00:19:24.680 You can go to Alexisbook.com if you want more stuff like this 466 00:19:24.680 --> 00:19:25.680 and get a free book. 467 00:19:25.720 --> 00:19:27.400 Anyways, lots of love, keep being awesome 468 00:19:27.400 --> 00:19:28.760 and have an amazing way to Wednesday 469 00:19:28.760 --> 00:19:29.920 and I'll see you guys on the flip side. 470 00:19:29.920 --> 00:19:30.760 Bye. 471 00:19:30.760 --> 00:19:31.600 Bye.