Speaker 1: Hey guys, I have Alan Martinez here from Noble Digital. You guys know him, he's on the Skool Pro Group. He's gonna tell us a little bit more about what he does. I have no idea, so this is gonna be a real treat. I'm gonna learn something, you're gonna learn something, so let's check it out. Let me try this again.

Speaker 2: I want you guys to listen to me. Yeah, I design sandwiches. My name is Jose Caballero and I talk about the business of design. The design.

Speaker 1: I talk about a lot of stuff. My name is Chris Doe and I talk about the business of design.

Speaker 2: At the center of this operating system, it's about understanding.

Speaker 1: Jose, can we just tell them what the show title is? I hate you, dude. You are watching The Process.

Speaker 2: You guys recognize the sales funnel. You guys have seen this before. What's in the sales funnel? Sales funnel is just the journey between top of funnel to the bottom of the funnel, which is like, I've never heard of you, to I'm kind of interested, or what is this, to okay, I'll find a little bit more, to okay, I'll give it a shot, to I'll buy it, and then this is more about the money part, but then the delight and referral part and people sharing. We're gonna actually put numbers to this. We're gonna assign a number. So, cost per customer acquisition. Cost per customer acquisition. To get someone to buy your service. Now, your service, if you don't mind me asking, is like, maybe break down into tiers.

Speaker 1: Our most expensive product is $1,200. That's core 360, right? And then going down from that, individual modules sell for $500. Then we sell subscription. Annual subscription is 250 sub, right? Then we sell AIB, which is, I believe, $200. AIB, and then a monthly membership for 25 bucks.

Speaker 2: Okay, so that's the lowest entry point.

Speaker 1: Yep.

Speaker 2: And below that is, we'll do, it's a $0, it's YouTube, right? You're subscribing to YouTube?

Speaker 1: Yeah, that's correct.

Speaker 2: What's that worth to you? Let's put a dollar figure on it. $1, let's put $1 down.

Speaker 1: Okay, $1. Well, we're not selling that. That's what we're paying to get it. Correct.

Speaker 2: So it should be here? Well, we're talking about the value. We're gonna get to the value. But that is like something, that's a goal. So these are your goals. The most important goal is to make as much money as possible. Let's be honest here, right? So if we can't get this-

Speaker 1: If you're asking me, not Jose. If you're asking me, yes.

Speaker 2: Jose's to have fun and make friends. As far as margins, it's not like you've made a hard product that costs you five bucks to sell for 10 bucks. So it's really 100% margin. All the time you spent developing, you still gotta get paid for that. But let's just say- For intents and purposes, let's say it's free. Sure. All right, now what? So what are your goals for this year?

Speaker 1: To increase our monthly reoccurring revenue. Right now we're doing about 8K. Okay, write that down. We wanna get to- Let's write this somewhere over here.

Speaker 2: So per month-

Speaker 1: Monthly reoccurring revenue, MRR, is about 8K right now. Okay. We want to get to 20K. Oh, okay. So you want to triple- That's our new. So by end of 2016, 2017, we need to get to 20K.

Speaker 2: Okay.

Speaker 1: So what else? What's the next step?

Speaker 2: So, and here's the part, and I'm gonna share, this is what direct marketers do. They would go to a company- Yeah. And they say, how many do you wanna sell in a year? And usually it's a bigger company. They would say, okay, we wanna sell a million units to make, you know, whatever, $2 million, right? Okay. They would then say, okay, so that's our budget. They would say, that is our budget, $2 million of ad spend to go for it. And what you're trying to do is get the CPA as low as possible, the cost per acquisition. So if you spend $2 million and you make $2 million, right? You broke even, and that's not ideal. So what all you're trying to do is drive down the CPA. You're hoping that you're gonna spend a million dollars to make $2 million, or hell, $500,000 to make $2 million. It's never gonna be zero, obviously, but it's gonna be something. Let's talk about the people, who you're, where's the top, where's this money coming from? Like, where's 10 or 20 or 50% of the money coming from? Like, a person or a city or- Yeah, well, I'll tell you the market. What's obvious from the data?

Speaker 1: The single biggest traffic driver is probably from YouTube onto our landing page, right? And our audience is broken up like this. It's US, it's India, and then it's the UK.

Speaker 2: Okay, is there kind of an age group you're seeing that's standing out, 20s to 30s, or is it more seasoned people?

Speaker 1: I would say it's the late 20s to 40s, somewhere in there. And then we check, this is YouTube data, then we compare it to Shopify data, and they-

Speaker 2: They're tethered together right now. Yeah.

Speaker 1: Okay, cool. Just manually, though, you know, how we look at it. Oh, there's no- There's no automated-

Speaker 2: Doesn't Shopify have a way to integrate your analytics?

Speaker 1: So, tip number one, guys. Tip number one, since we're using Shopify, we wanna tie our Shopify analytics to our YouTube analytics to see what patterns are happening. Right now, we don't. That's why I reached out to you and said, somebody help me with some basic analytics.

Speaker 2: Creative, videos, right? That's like top of funnel.

Speaker 1: Messaging, branding, all that stuff.

Speaker 2: Messaging, to get to the website. That's middle, you know, now they're interested, right? Right. And as you get to the IT stuff, that's when you have like the data. All this stuff has to go into buckets. So, you have like, hmm, your Java code, right? And your segmentation of buckets. You guys know what a bucket is? It's basically the personas. These are the personas.

Speaker 1: Yeah, we have our personas. We know what they are.

Speaker 2: Right, but you know what they are from your limited data, and then there's the marketplace speaking, which is actually gonna tell you what actually is happening, and then you have to make adjustments according to the actual data. So, it's like you're testing, and the reiteration comes from, oh wow, it's like these people in India. Maybe we need to do something that has that kind of slant to it, so people, we can attract them more. Maybe they deserve their own video. Maybe bring in like an influencer from India to speak on one of your things, and suddenly that lights up the Indian audience, for example. When you make those personas, you can also challenge using data, not like, you know, sometimes they're up high in the sky, like talking to a company a few months ago, and they're like, hey, this is our audience. They really thought it was this woman. Okay, I asked the guy behind the counter who actually delivers the pizza. I go, so tell me. He sat down with me, and he started telling me, actually, yeah, I agree with that, girls, but when I get there, there's always a guy in the sofa. I'm like, okay, it's a couple. That's a different story. Now, that helps me understand what the message is, or maybe if it's a video, maybe if it's a comic, or if it's a boy and a girl. It just leads to everything, but it's all based on the actual data. These are some really big, let's break these apart. These are your really big winners, right? These two? Well, I'll tell you what our best sellers are.

Speaker 1: Yes. Our best sellers are here. Go for it. Like percentage-wise? I would say it's split between core and AIB.

Speaker 2: All right, let's make a new CPA. We're gonna invent this one. Chris Do, how much would you spend to get someone to pay 1,200 bucks?

Speaker 1: As much as possible, as much as necessary. Not as much as possible, as much as necessary.

Speaker 2: 50%? 50%. Okay, so we'll say 600 bucks. That's a CPA for that. For this one?

Speaker 1: I would think they're all about half. I'd spend about half. That's a two-to-one conversion, man. I'd do that all day and night. You would average all those together, right? 1,200 plus 500 plus 250 plus 200. I'll leave out the YouTube for now. Yeah, leave out the YouTube. You'd actually have to add 500 three times because there's three different products. Then you would divide that by one, two, three, four, five, six, seven. That number divided by seven.

Speaker 2: The number I came up with is not too far off. It's 507. We'll just make it 500 bucks. Okay. What do you consider a lead? They haven't paid yet. YouTube was one of them, right? YouTube is an awareness. But we'll say-

Speaker 1: If they get to the Shopify page, I would consider a lead. That's the data I'm looking at now. So on average, we get about 80 people hitting the Shopify page.

Speaker 2: There's an email. Isn't there an email, like a newsletter to sign up? Yes. So we're talking newsletter and Shopify page is worth something to get to that far. YouTube. And what else we got besides YouTube for awareness? Facebook? Facebook.

Speaker 1: Okay. What else? We have Facebook, Instagram, and Twitter. And LinkedIn. The usual social media channels, right?

Speaker 2: I'll let you do that with my fingers.

Speaker 1: What's going on? Fingers not working? YouTube. They're not working.

Speaker 2: Twitter.

Speaker 1: LinkedIn.

Speaker 2: Yeah. So we have Shopify page. Is there anything else for leads that you have? There's no phone call, obviously. There's no phone call. Is there a chat thing?

Speaker 1: A chat box? Yeah, people might instant message me. I am? I am. They'll instant message me and talk to me about stuff and I do closed sales that way. So they reach out specifically asking about this. You know how on Facebook you can message somebody directly? Oh, okay. That's what I'm talking about. I am on Facebook. That's usually how they reach out to me. And I forgot there's other things that we do. We do lectures and workshops.

Speaker 2: Absolutely.

Speaker 1: So that should be in there.

Speaker 2: Yep.

Speaker 1: And we have press. Yeah. We get press. So we know that there's a spike when we do press. Or if there's other, or we do cross-channel promotions. Okay. Should I put that up here too?

Speaker 2: Yep. Yeah. So what would we consider a trial? I already have an idea. What do you mean? The next one's trial. What do you, I don't, I don't know.

Speaker 1: When you wrote that up there, we don't have a trial. A trial subscription. Does this feel like a trial to you? It is. That's why we created that. Yeah. We created it.

Speaker 2: It's lower tier. It's low tier.

Speaker 1: Let's try it out. Otherwise, there's too much of a gap. Yeah, that's true. And we are finding out that when people sign up on this, they very quickly buy a product.

Speaker 2: What's the conversion rate on this? Please tell me.

Speaker 1: I'm only gonna guess right now, but I would say it's at least 50%. Really? Yeah. That's amazing. I see they did a buy, and within 10, 15, 20, 30 days, they're buying something else. They're probably gonna go in. Okay, so now we have a cycle.

Speaker 2: So 50%, 10 to 15 days.

Speaker 1: Okay, let's just say 15 to 20 days. Okay. Sometimes they buy it in three days. It's really weird, because they just want to know that we're real. So what you're talking about, really?

Speaker 2: Is that right? Yeah, I think so. So these are two different cycles. These are two different kinds of people, a three-day person and a 15 to 20-day person.

Speaker 1: Yeah. I would say they're more on this side

Speaker 2: than they are this side. They're more on this side. Okay, but how, like 80, 20?

Speaker 1: Yeah. Who are these people for three days? Do you know anything about them yet? They're usually business owners. They already know us.

Speaker 2: Okay. Business owners that know you. Yeah. Or were referred by someone in you.

Speaker 1: They know us through the community, right? Okay. It's not gonna be some kid in Turkey. It's just not gonna. And then there's everybody else.

Speaker 2: Then there's everybody else. Yeah. So this is like the realistic cycle for the world, for the global domination of school. All right. This is good. This is good. So I wanna, I'll let you do the writing again. I wanna consider monthly subscription, your trial, and anything else you wanna.

Speaker 1: Well, we've been thinking about this.

Speaker 2: Right, Aaron? Any other ideas you have?

Speaker 1: Yeah, that we have. We're gonna give sample docs. You can download some sample documents.

Speaker 2: Like ones from the live, from your. From the kits.

Speaker 1: You just download them, look at them. So you know how Amazon does like 20 pages? We'll give you the first 20 pages. Check it out. It's legit. That's it. So read that if it's good for you. White papers. We'll call it a white paper. Okay. Anything else? That's all we got for now. Okay.

Speaker 2: Okay. And then for delight and referral, what are we talking about?

Speaker 1: Well, how we delight the customer is the people that are brave enough to join us and share the decks, we start to have real conversations and they're getting free business coaching from me. Oftentimes when I'm driving, I will just call up a random member, whoever wants to give me their phone number. I call them up. I check in on them. Like high touch. Customer service from me and Jose. Okay. Because we're on the forums and we're commenting and giving people feedback all the time.

Speaker 2: Yeah.

Speaker 1: That's how I complete the life.

Speaker 2: That's your customer service. It is. Yeah, exactly.

Speaker 1: Right? That's it. Yeah. So from calls to emails to documents, you get it. Yeah. And how do we delight you? You know what? You make money. Our customers make money.

Speaker 2: So if this is 500, maybe we'll work our way up. Backwards. So this is like 100% of what you'll pay. And of course you can spend less. Great. How much do you pay for a trial? Of the 500 bucks, how much would you pay for a trial? A trial subscription of 25 bucks? Yeah. What's it worth to you? Let me ask you another question. Let me do this a different way. Actually. With a cap? Forget about this. Of the people, you said it was 50% to do this?

Speaker 1: I think about 50% who buy the subscription become customers. So would 250 make sense to get someone to do a trial? To allocate some of that? That's a lot though. Because they're gonna buy probably AIB or this. You're saying I'm spending half of it already.

Speaker 2: Well, what I'm saying, I'm trying to see, it might be part of this whole CPA. Like this is like this stage. Just this stage alone to get to a purchase. It's like part of the 500 bucks.

Speaker 1: I don't know. Let's say 200 bucks. I'll just throw out a number, okay? Because we're getting half of a half. Because we're spending half of our budget and only half of them are convert. So I have to kind of be mindful.

Speaker 2: But what we're talking about here is a scale thing. It's a scale issue. And my question to you is like, you know, when you get some more users, do you have other items to sell them? We will. You will? I will. You definitely want to scale. Okay, so 50%, we'll say 200 bucks. So then what's the lead worth to you? How much? Less, obviously. Of course, of course, of course. But how much?

Speaker 1: Well, it depends on the conversion ratio, dude.

Speaker 2: What percentage of these people convert to here? What's the total conversion rate right now?

Speaker 1: It used to be sub 1%. And now it's about 2.5%.

Speaker 2: That's great. That's the average, actually. But that's good. What, 1% or 2.5? Two to 3% is the average for e-commerce sites in the world.

Speaker 3: If you're above that, you're doing really well. If someone comes to your website and learns about you from YouTube, out of 100 people, how many people actually might do the 25 bucks? Or do we like talk about 1,000 people?

Speaker 1: Two and a half percent. Out of 100 people that hit the Shopify page, two and a half percent were converting to buying something. So the minimum, they're gonna spend $25. And sometimes they'll drop $1,200 with the core 360.

Speaker 2: So what I'm doing here, this is just the website. Facebook has its own little funnel. YouTube has its own funnel. TV, whatever you're gonna do, right? Everything has its own little funnel before they get to the website. And so this is what we can control the most. This gets harder to control, and that's the art of advertising and digital, all that. But I'm gonna make this up. So we're at 200 bucks, and you were kind of not happy about that number either. But I would say for a lead, you should be able to pay like, I don't know, 25 bucks? Sure. Ish. We're making this up because we don't know, but I think we need to plug a number in just to start with. And you'll know right away, like, oh, this doesn't work after time, after we start pumping some volume up. This number might be too low or too high. We'll know right away. Right now, we don't really know. So for awareness, maybe it's worth $1 to get someone to sign up, right? Or it's worth that. I'd spend that. Or maybe 10 bucks. Is 10 bucks too high?

Speaker 1: A little bit, maybe five. But I would pay easily a dollar because if it means somebody who's gonna go to and sign up for the newsletter or watch our episode and subscribe or something like that, then it's worth it.

Speaker 2: So once they purchase, that is your CPA. So technically, you actually have 500 bucks to work with here. All right. I understand. We have to redo these numbers. You have 500 bucks to distribute per person. So that, we're talking about, as they go down the funnel, they're worth more, right? So how much per person?

Speaker 1: Maybe 300, 200. And no, it's gotta be different than that. Maybe 50, 100, and then the remainder, 350. So how much for this? 50. For awareness, right? You're saying add all those up to be 500, right? And then 100, and then 350.

Speaker 2: So yeah, when you start getting someone down this funnel, they're worth more and more. And so maybe these things start becoming, they should become more valuable to keep the flow going. The point is, it's like when we're spending money on media spend, and they're clicking through to this point, and then they're clicking through to here to this point, and then they're clicking through to download this, like every stage, we're gonna be having drop-off, drop-off, drop-off, and now we're left with 100 people, or 100,000 people, and now we're down to like 10,000. Now we're down to like 1,000, and now we're down to like 100 people when we're down here. And that's your 2.5. So we have, that means we have, so we have, that means, so if you want to- That's the average. 50%, 250.

Speaker 1: If I want 2X ROI, I have to spend half.

Speaker 2: Right. By the way, you might want to go 100% ROI, one-to-one.

Speaker 1: I can do that.

Speaker 2: You might need to do that for a minute.

Speaker 1: Sure, I can leave that. But I was just saying the normal model.

Speaker 2: Yeah, that's where we want, look, the reality is we want to start with the 500 bucks and drive it down to 250 over time. But we want to be everywhere and go, okay, that's not working, this is working, let's put more money here, and we want to start just crunching this down to start getting metrics that are performing. This is performance. It takes time and money, and you know, and we can speed that process up as much as you want. But as long as we're not losing money, we can speed up even faster. If you're below, like if you're not upside down, we should be increasing the budget every month until it starts to break or fall apart or not make sense.

Speaker 1: Right, okay, let's review here. So what you're doing is you're facilitating me in trying to figure out how to convert, what it's worth, et cetera, down to very granular things. So anything that's e-commerce, especially, is going to be very attractive. Yes. Right? E-commerce is all bop-bop online, e-commerce is all bop-bop. That's where you're strongest, right, because it's all data-driven. Yeah. Other stuff is like too touchy-feely, we just don't know. Here's what I think. If we had certified teams of specialists, and I mean, your specialty, conversion down here, data, conversion, what do you call it?

Speaker 2: We would call it a conversion funnel.

Speaker 1: Conversion funnel as a strategist for conversion. Yeah. And then we have a strategist for social. Right. Because somebody else out there is doing an amazing job, we don't know. And then we're strategists for the brand top funnel.

Speaker 3: Right.

Speaker 1: And then if you get the lead, you bring us in to do the top, we get the lead, we bring you in to do the conversion funnel, right? Right. That's how I see now how to use you. What is it going to take? So if it's Lance Mayfield, if it's Ben Burns, and they get a good gig and they want to do conversion, and want to bring you in to do this part of it, what's the rate? You can give me a range, you can give me a rate so that at least now I can walk around and say, if the engagement is in of this size, I cannot call Al in. Sure. What is that rate?

Speaker 2: Sure, I would say five to 10,000.

Speaker 1: Okay. Yeah. Maybe Al needs to have some kind of quicker, leaner version of this to demonstrate value. Here's how I look at it, Al, and we've talked about this on the call before, which is give them the Trojan horse. Give them something easy, very attractive, so you can get going. Because once you are in, you can prove your value very easily. Right. For example, this is often how it goes. I go meet with a prospective client, you know, they look at the deck, we talk, and they're like, okay, we're ready to do strategy with you. And if I smell that this is an e-commerce play, then I say, okay, well, my strategy rate's going to go up a little bit, because I'm going to bring you in. Just to do that part of it, which is to facilitate it with me during the two days, you come in on the second day, because you need to be there for everything else. Yes. I would brief you, I'd give you the materials, you'd come in, you would run this part. How long would it take you to do this part? A couple hours? An hour? So then, what would you charge? Come in for that hour or two, and then go do your work, and then come back and say, guys, here's the unified recommendations. Chris, you really need to recommend the design of the website this way, because we know this, this, and that. Right. Is that still the same, the five to 10?

Speaker 2: We can talk about that, because it just depends on, maybe there's a way for me to go in in a different way, and not have to make a whole. What are you thinking?

Speaker 1: Off the top of your head. 2,500 bucks, five grand, simpler engagement. Okay, yeah, simpler engagement. Let's say three. So if you guys want to bring him in just for this. Now, I'm not talking about all the other work, because there's still a lot more work to do, just to get started, so that you guys can be thinking, all right, maybe on a $12,000 engagement, you can bring him in. Because if you're paying that three out of 12, that's about the threshold, right? A quarter of what you're bringing in, because you still have to get paid for all the development and the time you spent. So if you're at that point where you're looking at a 12 plus K engagement for strategy, and there's an e-commerce component, you can bring Al in for right now, while he's still affordable, for three K to run that with you. And he'll do a little bit of homework, he'll put it together, you guys will have this unified team, and you'll be a team of experts. And I like that idea a lot. All right, guys, thanks for tuning in. Hope this was helpful to you. I learned a lot myself, and there's a definite way that you guys can integrate what Alan is doing with Noble Digital into what you're offering, and I think it's gonna be valuable to your clients as well. ♪ Oh,