Sales Funnel Radio SFR 273: Simple Marketing Math
After the basic marketing principles are learned, tracking effectiveness really just comes down to simple numbers…
One of the BIGGEST reasons why people don't move forward in this game is that they feel that they’re unqualified for what they're being taught.
Meaning, they say:
"That’s awesome, but it will NOT work in my situation."
Besides doubt itself, that attitude has killed more dreams than almost anything else
The belief that what they're learning doesn't actually apply to them is, in my opinion …
One of the biggest reasons why people don’t move forward in their lives and get what they want.
I have a bee in my bonnet about this… and frankly, it pisses me off!
I've had so many people say things like:
"Stephen, you're in the info product space, therefore what you’re teaching can't work for me, because I'm selling e-comm..." or whatever.
So, I wanna teach you how I used specific marketing principles and applied them to an e-comm funnel!
I'm following marketing and sales principles, not funnel principles.
The marketing and sales principles tell me what to do beyond, "What’s the model?”
...and so I just follow these principles.
It doesn't matter what you sell, it has nothing to do with that.
BEST MARKETING PRACTICES, (NO YOU’RE NOT THE EXCEPTION)
*TRUTH NUKE*
You’re selling to a 100,000-year-old brain, so unless you've found that one person in 100,000 who’s found a way to negate the human brain, this applies to EVERYONE.
And *YES* … it’ll work for you, even if you're in...
- Retail
- B2B
- Multi-stage high ticket sales.
And it’ll work for you EVEN if you don’t collect the cash on the internet…
Those types of things are mechanics.
I want you to understand marketing and sales at a deeper level than just ‘how do you sell in just a single scenario.’
The principles are the same and the product really doesn't matter nearly as much as people think it does.
(Yep, still pissed, but I'll stop pounding that point now!)
The bottom line is, everyone could achieve so much MORE if they just actually start executing!
SELLING CAPITALISM SWAG
I love selling info products for a lot of reasons, but today, I'm gonna walk you through how I boosted the cart value for some physical products…
I’m gonna share the case study of my recent Capitalism Swag funnel.
This is something that it might be advantageous for you to go to salesfunnelradio.tv to watch - click the link and it'll take you straight to the YouTube channel…
*However, my blog writer is awesome - so if you prefer to read you can stay put! 😉
DIGITAL MARKETING STRATEGY - MY OPENCART
So this a screenshot of the stats dashboard…
The cart was open for about five days, but the stats cover a week, 'cause there were a few follow-up sales that happened because we had some "seen but not purchased" email sequences going.
So this is July 17th - July 24th, 2019.
There are a few key principles I wanna share with you guys on this, but first, let me show you the funnel...
FUNNEL PAGE #1:
We gave the option to buy the Capitalist Pig t-shirts.
(...and by the way, you can go to capitalismswag.com and sign up for the notification list if you wanna jump on the next drop.)
The whole goal of Capitalism Swag is to make rather jarring t-shirts which say the message so that you don't have to.
The offer was a $32 t-shirt; which was NOT cheap, but not crazy expensive either.
I mean, there are t-shirts out there that cost way more than that… but it's towards the upper range.
And let’s face it…
It would be really weird to sell discount Capitalist Pig t-shirts - that would be against the actual message.
Anyway…
- There was a male fit and a female fit.
- You could buy 1-5 shirts of any size.
- We added a $19 bump - which was a hat.
It's so dumb to not have a bump!
Anyway, the bump was 19 bucks, which is very comparable for a hat.
FUNNEL PAGE #2:
On the next page, we offered a hoodie for $69...
A little bit more expensive, but it was a super nice one.
...and it was like, “Hey, whatever size shirt you chose on the last page, that's the size of the hoodie you’ll get.”
For the next page, I remembered a powerful lesson I learned back in the day when we launched the Expert Secrets book…
DIGITAL MARKETING - EXPERT SECRETS STYLE
I’m very observant, it's one of my superpowers, and when I was at ClickFunnel I observed what Russell did like crazy!
One of the things I noticed was that, a lot of times, when Russell sold a book, something physical, swag, or whatever it might be…
The first few steps in the funnel were physical because the perceived value is extremely high…
However, the cost of goods was also high because you’ve gotta...
- Pay for them
- Print them
- Put them in a box
- Ship them (...and if you’re not the one doing it, the costs go up, and I'm not gonna be the one doing that!)
So that means super high costs at the top of the funnel.
However, as we moved down the funnel, (and it was the same in the Expert Secrets book funnel), the upsells get more digital.
Q: What's the cost to fulfill something that is digital?
A: *NOTHING*
It doesn't cost me anything to fulfill on digital, but I do have to sell it harder.
We know that the second “YES” is ALWAYS easier than the first…
So if I'm selling physical, I might as well have a digital something down the road…
Which brings me to page #3...
FUNNEL PAGE #3:
For page #3, I was like, "Well, what can we add that would be digital?"
And sure enough, we had this thing called OfferMind MasterClass, which included a ticket to OfferMind.
It’s basically an OfferMind ticket for $297, but they are also getting the OfferMind MasterClass with it as well.
FUNNEL PAGE #4:
Finally, we had ‘Thank You’ page that was actually a ‘Thank You’ page webinar with a special deal.
It was a $3000 product for 50% off called My Funnel Stash
Now, this is really key as we move forward…
It’s the reason why if they clicked ‘buy’ on the 50% OFF offer, then the actual order page, the fulfillment, and all that was actually in a different funnel... (which is why it's NOT part of the stash dashboard)…
... but we had sales directly from My Funnel Stache from this funnel.
Now what I'm gonna do real fast is use another marker to go through this, (and let me kinda zoom this up here a little bit so you guys can see it a little better)...
So now it’s time to walk through some numbers…
CAPITALISM SWAG - THE NUMBERS
We had…
- 1751unique people saw the first page.
- We had 121 bought a shirt = 6.9% conversion rate
- 12 people, (about 10%- I forgot to click the down button and see), bought the hat.
- 20 people bought the sweatshirt = 15% conversion rate
- We had 12 people buy OfferMind MasterClass = 10% conversion rate
- We had 2 people buy the offer on the ‘Thank You’ page webinar - now that's NOT a lot, but the price tag is high.
It's incredible, but it was also a screaming success.
I launched to a hot-list and didn't spend any ad money.
...and what's interesting is what happens next, check this out...
So if we look at this on the stats dashboard right here real quick; we had $10,700 come through just on the shirts, NOT including the ‘Thank You' page webinar.
We had 2 sales, (which is another three grand), so our actual gross amount of revenue from this funnel was $13,786.95.
Now the reason why these numbers are such a BIG success is that there were only 121 buyers.
So if you divide $13,000 by the 121 buyers...
...instead of it being an $89 cart value, (which is still awesome for a $32 shirt, it's like them buying three of everything), it was actually $113!
The BIGGEST thing I want you to know right now is that I'm NOT sharing this with you guys so you're like, "Oh, this is how he got us..."
NO, NO, NO! This is *smart marketing*, (if I'm allowed to say that about myself)... 😉
This is using is the marketing and sales principles of funnels to sell anything.
The whole point of this funnel was to help people gain more awareness and go purchase OfferMind tickets - that's why everything after this goes to OfferMind…
#OfferMind, #OfferMind, #OfferMind.
Capitalism Swag was created as a front-end for OfferMind.
It's also to help people create messages on their chest that say, "Hey, I believe and don't believe this!"
But as a business, it's a front-end for OfferMind - that's why we created the whole thing!
This was such a huge deal because instead of it being $89, the average cart value became $113 because of the ‘Thank You’ page webinar offer…
...it was like everyone bought an additional t-shirt, even though only two people bought that final BIG offer.
BOOSTING YOUR AVERAGE CART VALUE
Okay, so think about this for a second…
There was a $113 average cart value (no ads to hot-list shot, and it was only open for five days).
- We had ‘seen but not purchased sequences,’ so if people saw the hoodie but didn't buy, we had two or three emails that reminded them.
We had a number of people buy after that.
- We had ‘seen but not purchase’ sequences that came in, "Hey, I see you didn't get the OfferMind Masterclass..."
... and we had a number of people that came and bought that.
- Of the 121 who entered the funnel, we got a substantial boost to the revenue by having a ‘seen but not purchased’ sequence.
- We had a substantial revenue boost by having a few digital products in the back that were very valuable.
- There was also a substantial revenue boost by having 12 people buy another $20 hat order bump on the first page.
These are powerful principles.
We also had the option to add downsells to a couple of the pages…
- If people didn't click “Yes” for the OfferMind MasterClass there was a downsell which offered it as a two-pay option for (I think) an extra $30, $40, $50.
So downsells on either the OfferMind MasterClass or My Funnel Stache dramatically helped the revenue.
APPLYING PRINCIPLES TO ANY INDUSTRY
I had a chance to go consult with a clothing company recently and the principle of increasing average cart value was one that I went through with them…
The question you ask is…
How can I increase the average cart value of those who are already buying and those who are already in the motion of purchasing?
Q: You know what happens when you give people the option to spend more money?
A: They spend more money!
So instead of only being able to spend $32 on ads...
(Right now, I have the cost of goods and I have all that stuff as well, so it's not that full amount)...
...there’s a significant amount more cash I can spend on ads because of those higher-priced digital upsells.
Now I can spend $113 I can spend to acquire a single customer.
...that's crazy.!
Can you tell me another t-shirt company that has the ability to do that kind of stuff?
There's not many out there!
That's why I wanted to share this with you…
BREAK THE RULES
If you already have a funnel that's up and running right now, instead of going and trying to build another funnel, (which I'm not saying to not do)...
But go back to your initial funnel and look to see where the obvious places for upsells and down sells are?
If you’re thinking: “Hang on a minute, Steve! You put a webinar in the back of an e-comm funnel???”
“Heck Yeah, Son!”
…’cause it doesn't matter!
The rules are more blurry than we tend to make them.
If you’re thinking “Whoa, but that's an info-product practice!”
I have another question for you…
Well, are you sure? 😉
TWO PRINCIPLES
Sooo…
#1: If you already have a funnel up, I challenge you to go in and say, “Where can I grab more cash off the table?”
If you don't have a funnel up yet...
- I encourage you to just get something out there.
- Solve a problem
- Make something in the marketplace that's of value, and just put something up.
- Start gathering data to start tweaking stuff and that alone, right there, will start dropping false beliefs more than you trying to plan the crap out of it.
- Stop! Get it up! Just get it out the door!!!
#2: I want you to ask yourself the question: How can I increase the average cart value?
MAX CART VALUE (& WHY IT MATTERS)
Now, I wanna run through one last piece on this to just to illustrate the principle….
… cause this whole game is a lot more engineer-able than most people realize!
Let's say I was to buy EVERYTHING in the funnel, check this out…
- $32 for the shirt
- $19 for the bump
- $69 for the hoodie
- $297 for OfferMind Masterclass
- $1497 for My Funnel Stache
... if I was to buy every single thing inside of this funnel, I would spend $1914.
If someone was to buy everything from the funnel, I call that The Max Cart Value.
...I don't know if there's another term for it, I just kinda I call it that.
I've seen my average cart value be as high as a third of the max cart value, but that's not too often.
So, let's take SaaS, for example, (aka the software industry)...
For SaaS, a lot of times, it’s $100-$250 just to acquire a customer trial - that's not abnormal.
So if I know, “Oh my gosh, I need to be able to fund $100-$250 just to acquire a trial,” then my max cart value better be 10x that amount.
So I if I divide my $113 average cart value by the Max Value of $1914 - that's 5%...
... so if I needed $100-$250 to acquire a customer, I would need to boost my average cart value.
Does that make sense?
MATH & MARKETING PRINCIPLES
- One way to approach this game is to know, "Hey, this is how much money I make on average when somebody comes through my funnel."
- The other thing to consider is how much ‘typically’ somebody in your industry is spending to acquire a customer
- ... and then, just try to get your max cart value as high as you can to give you the best shot at acquiring that customer for FREE.
… and if that didn’t make sense, go rewatch on YouTube... 'cause that’s a powerful, powerful principle!
When I started realizing that principle, I was just looking at the average cart value and asking...
“How can I get my average cart value really, really massive?"
But now I look at the max cart value…
I’m like, "Oh man, I need to add another upsell in here that's worth like $500? Yeah, yeah, yeah. Let's put a $497. What is worth way more than 497?”
I boost my max cart value which, in turn, increases my average cart value and that will help get me above my cost to acquire.
The relationship between the...
- Cost to Acquire
- Average Cart Value
- Max Cart Value
...is one of the things I'm looking at A LOT when I developing funnels now.
And let me repeat, it doesn't matter if your business is...
- E-comm
- Info
- High ticket
...and it doesn't matter if you collect the actual money online or offline!
A lot of people get leads like this, the first funnel you see is not what they actually sell, but where they get the leads.
You’re using an offer for something else is paying for the leads, you're liquidating all of it, and then you're collecting all the cash on the back.
I can feel there's not enough story in this episode, but I'm hoping it's walked you through a little bit more of how my brain works when I'm starting to design funnels.
I have six funnels on deck right now, and they're big ones, they're hard ones, they're challenging funnels to think through and put together.
...and I'm excited about them!
But this is what I'm looking at…
How can I spend the most to acquire a customer?
I wanna be able to spend more money profitably than all my competition to acquire a lead.
Not only am I awesome at fulfilling on it, but my offers are amazing #I’mTheOfferGuy
But if I can speak louder and be amazing, that's *HUGE*.
Sometimes, people are like, "Oh Stephen, I'm not gonna speak louder 'cause my products so good."
*DO BOTH*
- I'm gonna speak crazy awesomely loud, (which you all know I can) 😉
- I'm gonna be able to spend more money to acquire a customer than everybody else because I understand these very simple principles.
So go in and start thinking through that….
- Do you actually know your cost to acquire a customer right now?
- Do you know your average cart value?
- What's the most amount of money somebody could spend in a buying session?
- Can you increase that ceiling?
Then watch your average cart value increase as you increase your max cart value ceiling.
...that's the game!
Once you realize that, you're like, "BOOM! Now, I got this huge list of people who are buyers."
And then I can go dump all of this $13,000 in revenue back into...
- Fulfillment for the t-shirts and all that stuff
- Back into ads… or in this case, OfferMind to make it even cooler…
...we’re not taking profit, I want to dump MORE money into cooler, bigger projects! … it’s exactly the same principle.
Hopefully, you enjoyed this!
If you did, I’d love a review from you, go to sjlreview.com - that’s Stephen Joseph Larsen!
Be honest.
If it's brutal, be brutal, but if you wouldn't mind, leave me a review.
And then, go implement *this* in your business….
Go figure out…
- Where am I leaving more cash on the table?
- Start thinking about the principles of …
- Cost to Acquire
- Average Cart Value
- Max Cart Value
...and when you start looking at it you’ll realize, "Oh my gosh, this game is not as much about guessing and getting lucky as I thought."
I remember when I realized that myself!
I'll see you next time… and hopefully, I'll see you at OfferMind.
BOOM!
If you're just starting out you're probably studying a lot. That's good. You're probably geeking out on all the strategies, right? That's also good.
But the hardest part is figuring out what the market wants to buy and how you should sell it to them, right?
That's what I struggled with for a while until I learned the formula.
So I created a special Mastermind called an OfferMind to get you on track with the right offer, and more importantly the right sales script to get it off the ground and sell it.
Wanna come?
There are small groups on purpose, so I can answer your direct questions in person for two straight days.
You can hold your spot by going to OfferMind.com.
Advertising Inquiries: https://redcircle.com/brands