John Jantsch (00:00): This episode of the duct tape marketing podcast is brought to you by business made simple hosted by Donald Miller and brought to you by the HubSpot podcast network business made simple, takes the mystery out of growing your business. A long time, listeners will know that Donald Miller’s been on this show at least a couple times. There’s a recent episode. I wanna point out how to make money with your current products, man, such an important lesson about leveraging what you’ve already done to get more from it. Listen to business made simple wherever you get your podcasts.

John Jantsch (00:46): Hello, and welcome to another episode of the duct tape marketing podcast. This is John Jantsch and my guest today is Mike Blumenthal. He’s the co-founder and analyst at near media, where he researches and reports on reputation reviews and local search. Today. He also provides local consulting to a range of businesses, big and small across the SMB and SAS marketplaces. He’s assisting a company called air.com and an online professional photographic marketplace to pivot to the local marketing space and helping them bring the power of photography to every business location in the us and Canada. So the reason I talk about air.com cam I’m sorry, is that we are gonna talk about visual search images in search. So Mike, welcome really back to the show. It’s been a couple times for you at least.

Mike Blumenthal (01:37): Thank you very much for having me. It’s always a pleasure to speak with you both personally and professionally.

John Jantsch (01:43): Oh, thanks so much. So let’s talk, I mean, I’ll give you the really big question that you could probably talk the rest of the show for, but you know, our, you know, what’s the growing importance of images in search, you know, what are all the factors that are leading us to talk about this thing?

Mike Blumenthal (01:59): So Google just today announced that 40% of their audience, younger audiences don’t even come to Google search anymore because they prefer the visual nature of TikTok. So talk, so Google has gotten this for a very long time, but search has become about entities more than keywords. And in that Google is streaming visuals of entities everywhere in the search results. These days, both in older search results and newer search results and images, both drive search results and convert users. So they play an ever increasing role, not just in the non search world of social, but particularly in the search world of Google. Google is emphasizing images more and more. I did a analysis of the pixels of a mobile screen on a small business focused to keep a search and 35% of the surgeries. Well, 36% were image pixels versus 2017 when there was 0% of the search results were images on mobile. So they’ve moved very rapidly and very heavily into a visual stream of information as opposed to text.

John Jantsch (03:15): Now, I think for a long time, if I searched for something that was clearly a product, I was getting visuals in there. But I mean, are you suggesting that this is really, even for things that are, you know, not quite as clearly defined as products.

Mike Blumenthal (03:29): Yes. So if you break up say a mobile search result adds at the top, let’s say LSA, add local service ads. Right, right, right. Google has started putting images of lawyers in there, obviously, excuse me, in product searches, you see products, but in the pack, you’ll see carousel associated with each business in the organic result, Google will show up to five images in the mobile result for a loca for organic page. And then they have a whole range of new search units that are strictly visually based order food searched by photo. And it doesn’t need to be in a visual industry, could be in pest control, could be in plumbing. Yeah. Obviously in purchase driven industries like jewelry, it’s obvious, but it’s showing up everywhere in all of those elements, ads, local pack, organic results, new search units, and virtually every one of those has become image Laden.

John Jantsch (04:30): So going back to the ancient ages of the internet, you know, people would sometimes even turn images off because of bandwidth issues and things. And so we, we all got very into producing, you know, alt attribute, you know, describing what the picture actually was. And that that was a, a help. Certainly it was a help to visually impaired, but it was also a certainly a help to Google to maybe know what that picture is about. What can search engines know about images now? I mean, how is, how has that changed?

Mike Blumenthal (04:55): So it’s the most exciting part of search these days is Google’s incredible understanding, driven by AI and machine learning of everything in the image. They understand the objects in the image. They understand the entities in the images. They understand the color patterns. They understand whether they’re suggestive or unsafe in a yeah. Yeah. Social sense. They even understand clothing styles, not only do they understand color and color patterns, they can read and understand the logos. They can read text and convert the text image to a text understanding. So they literally understand all aspects of an image, whether you have an T tag or whether you don’t. And this is to me, the most amazing thing, because they’re using that extensively to match images, to search your intent in the search results. So they will actually show you images based that the search results will change based on your query, the images will reflect closer to your query than

John Jantsch (06:01): So one of the knocks I’ve heard on this a little bit, of course, you know, business owners like to complain because they think Google’s there to serve them. is that, you know, if I search for a product, it will also say, uh, here’s some things like that that you could buy, or if you like that, you’re certainly telling us your style is this. And so here’s some competitors products that you can buy again. You know, what do you say to the business owner that says, I don’t like that because they’re showing my competitors, I’ve done a great job, you know, of optimizing and showing up and search, and now Google’s going out and showing my competitors

Mike Blumenthal (06:35): Well, Google is as Google does. Right? And they’re big. And you’re little the reality is that more people see you on Google search than see you almost any place else in the world. And the other reality is that more people convert to your business from Google search directly from Google search than from your website or any place else in a number of studies that I’ve done, joy Hawkins has done is Sterling sky, anywhere from 75 to 85% of local conversions are happening right on Google. Other words, people are clicking the call, right. Click to right driving directions right then and there, and not coming to your website. So you can either accept that reality or ignore that reality. Obviously ignoring 75% of your conversions. We’re not talking about visibility or talking about conversions. It is a mistake. And if they’re gonna give you the conversions, particularly if they’re gonna give ’em to you for free, I think you need to maximize it to do that to you need to understand that this is where you’re going to be seen the most. Yeah. And not only do you have to optimize your listing, you have to optimize every image and everything you do there. So that when you are compared to these other places, you look both, you look visually better and reputationally better so that people choose you.

John Jantsch (07:55): Would you say, so let’s say a typical blog post. Would you say that the visual element of that blog post is now sending a signal? That’s going to be a ranking signal to search engines, even if it’s just vaguely about what the post is about, or are you saying that we should be picking a, uh, images that we can optimize in that would clearly like enhance, you know, the search component, you know, rather than just the visual component.

Mike Blumenthal (08:23): So the latter, it’s not clear in organic that images are ranking factors, but Google understands the content of images and it will increase your clickthroughs. If Google includes an image in your organic results. So you get direct benefit from it. In the local, we have hard concrete evidence of conversion increases anywhere from 15 to 90% upticks in conversions. And there’s some research out of patient pop, where they saw a 15% increase by switching both their Google local and their website from stock images to professional images, they actually saw about a 15% improvement in appointments at the participating practices. So big numbers of improvement, and it comes from sort of everything. It’s not just the blog post, it’s the blog post plus the website plus local, I think. Yeah. So I don’t think you can focus on any one of those, but if you’re going to, if your search result has images and your competitors doesn’t have images, then you’re gonna get more clicks regardless.

John Jantsch (09:34): Yeah. And I think that’s a great point because I think we get so obsessed with, you know, ranking , but that, that, you know, if there were five, five competitors on page one, and just, as you said, maybe I’m in the three position, but I have an image that’s very attractive. You know, I’m gonna, not only am I going to get more clickthroughs, I’m probably going to improve my, my search results. Aren’t

Mike Blumenthal (09:56): I time and you’re gonna improve your conversions, which

John Jantsch (09:58): Yeah. Which is ultimately what

Mike Blumenthal (09:59): We’re after what it’s all about. Right. I mean, interesting research out of Airbnb 2017, where they deconstructed photographs and under understand the elements of them and then analyzed when they followed these sort of rules of photography with professional photographer, photographs that followed the rule of thirds and good lighting and balanced imagery, they saw rental units increase sales on average by $2,800 annually. We we’re talking big bottom line numbers from having better images, nothing else changed. The images changed and dollar values of the listing went up.

John Jantsch (10:39): Yeah. I actually saw, at some point they were actually offering photographers, you know, local photographers to go out and shoot your place for, because they knew how much value that had cuz people were doing a really, you know, you’d see some really bad photos. And so yeah. Makes a ton of sense.

John Jantsch (10:53): And now let’s hear from a sponsor, you know, everybody’s online today, but here’s the question. Are they finding your website? You can grab the online spotlight and your customer’s attention with SEMrush from content and SEO to ads and social media. SEMrush is your one stop shop for online marketing build, manage and measure campaigns across all channels faster and easier. Are you ready to take your business to the next level, to get seen, get SEMRush, visit SEMrush.com that’s S E M rush.com/go.

John Jantsch (11:31): And you could try it for seven days for free. Is there a relationship between image search or visual search and voice and text?

Mike Blumenthal (11:39): Well, the underlying technology of all of them are entities, real world things that Google is building graphs around people, places, item that Google is understanding more about them and the relationships between them. So at the highest level, they understand your brand and then they understand what your business does and they understand the products. Those are all entities and all searches becoming entities search, as opposed to it used to be keyword driven now. Yeah, it’s sort of conceptually driven by the knowledge graph. And this is true. Whether it’s text search or visual search or audio search, all the underlying technology in all of them is the knowledge graph with the interlinking between the various elements. So they’re all function largely the same, but Google just delivers ’em in a different format.

John Jantsch (12:36): This is a really big question that you maybe can zero in on because you could go all over. You know, what’s the role of AI in all of this.

Mike Blumenthal (12:43): So it’s critical. Google has, I don’t, if you go, if you remember back to Google, plus let me give you some history here. Sure. Google introduced Google photos as part of Google plus, and it was a very groundbreaking product that when Google plus was going down, Google photos was spun off into its own thing. And I think it was 2050 when it first came out, I was using it. And it was clear at the time that they were understanding everything in the images with no labeling. Yeah. And they understood location and all these other things about it. Now, since that time they’ve gotten 4 trillion images uploaded. They get 28 billion a week uploaded. They have scraped almost every image on the internet. They’ve gotten businesses to upload every image products about the place. So Google has trillions and trillions of images to which they’ve used to train large, these large assets to train their understanding.

Mike Blumenthal (13:42): And they, they have created one of the best understandings of images. Now AI still has its limits and certainly AI can be stupid sometimes in a non-human way and make mistakes. So in that sense, it’s really important that when you take a photograph these days, that it appeals to a human, but that it is also understandable by the AI in the machine. You’ve gotta test it. You’ve gotta know that the picture of the dentist, Google, not only does the consumer think it looks good about the dentist, but that Google as a machine understands it as well.

John Jantsch (14:21): So, so that leads me to the point. You know, we we’ve, a lot of people have been using AI to now test what’s the best subject line now that I should send. Right. So are you suggesting that somebody could take three pictures that they are thinking about using for something and use a tool that would say this is actually the best picture from a Google understanding or from a optimization standpoint?

Mike Blumenthal (14:43): Yes, I am saying that the tool you wanna use is Google’s cloud vision AI. It was used to be free now, put it behind a paywall, but the company you mentioned at the beginning, they’ve actually just recently switched their website to air cam.ai. Although the other one redirects has re has recreated Google’s tool on their website. So if you go there, air camm.ai forward size, Google dash vision, I think, but you’ll find it on the main page. Click on that, drop the image three images in and see what Google understands image ads Z. And if it’s a great tiebreaker, because if Google understands one better than the other, in fact, this happened in a real shoot. We were in a dentist office and we took a couple pictures of the dentist with their actually had their secretary in the chair. But, and one Google thought was about medical equipment because of the hand with the medical glove was in front of the, just sort of low in the image and Google mistook that as the intent of the image, whereas the one where the hand was hidden, Google saw it as a dental image, even though to human, both looked equally good.

John Jantsch (15:51): And the data from, yes. Okay. So the data from that exercise or that search would, how else would you use that? Would you put that as the alt tag? Would you use that somehow else?

Mike Blumenthal (16:02): It, I mean, alt tags are value still valuable, but the reason has returned to their original reason, which is to help people who have foresight understand the content of an image. Correct? Yeah. Google, I think gave up on all tags long ago, they realized that most businesses aren’t going to use them. I was trying to understand what, why Google was including images in the mobile search results. So I picked 50 search results that had images went and looked at the images on the website. And literally only one of them had an all tag and Google had still grabbed all these images and put it into the search results. Now I think the Alag helped Google confirm. I don’t, but they’re not using it as a primary thing. And more importantly, it helps your user understand image, right? So I think all tags are still important. Just not to inform Google,

John Jantsch (16:52): Tell me where augmented reality is with images. So I don’t know how long ago, 10 years ago, do you remember Yelp came out with that Parascope thing? I think it was called, right. And you could point your phone, the app down a street and it would augment what you were looking at. Where is that in this conversation or does it even have a place anymore?

Mike Blumenthal (17:13): Well, it does have a, well, it doesn’t have a place today from small business marketing for the most part. Now there is an aspect of visual search. Visual search has a very specific meaning. What we’ve been talking about up to this type time is visual search. In other words, search results, search results that are massively filled with images, but where people still input and text visual search as a technical term, refer to somebody, dropping an image into the search and searching on the image that’s visual search. Yeah, yeah. Yeah. So Google lens has now implemented a combined search where you can take a picture of an object, add a text Modi, and then it will return results to so that’s visual search. Now the role of AI AR in this has been very slow to developed because the tools to see the AR have been slow to develop the most sophisticated tools right now are from Niantic and apple.

Mike Blumenthal (18:17): Those are the two leaders and apple has been very slow and methodical in building underlying technology into the phones and, but has been much slower at releasing a device that focuses on it. But you’re starting to see it come up in very like Amazon uses it to allow you to position furniture in your room. Oh, right, right. Those types of things where you’re seeing objects placed over real world. Yeah. And Apple’s announcement around iOS, sixteen’s gonna dramatically accelerate that. So right now it’s not quite ready for a small business to worry about it from a marketing point of view. Um, but I think there, there will be use cases. Now video, on the other hand, short video, particularly 30 seconds and shorter Google is under parsing. Those the same way they parse images, understanding all the elements in the video, the break points, the topics, what people are talking about. They’re transcribing them in real time. I think video is probably on the cusp of breakthrough has broken through in TikTok, but I think it will break through on Google very shortly. I think 30, 32nd and shorter videos have a huge role in small business marketing. And I think it’s eminently doable with the technology that’s available. And I think Google will reward it much the same way. It’s rewarding images with increased conversions, increased visibility, more phone calls,

John Jantsch (19:50): And those videos need to be on YouTube or in natively embedded on your site is fine.

Mike Blumenthal (19:57): I, you know, I don’t know where you’re gonna get the best conversion, but I would do your site. Let’s Google my business. Plus YouTube. I would do ’em all three places. And I probably would do ’em. I’d do ’em on YouTube. Use the YouTube to embed it on your site and then upload it to Google my business as well. And I think I would give you the maximum

John Jantsch (20:18): Just to Google my business, or I guess we need to say Google business profile. We

Mike Blumenthal (20:22): Do need to

John Jantsch (20:23): Say business Google

Mike Blumenthal (20:24): Business profile,

John Jantsch (20:25): Which Google business pro I had actually somebody asked me if I could help optimize their Google places page. So I was like, wow, great. That really hasn’t been updated for a while. Has it? So, so you’re saying though that to put those videos in posts on, on your Google business

Mike Blumenthal (20:38): Profile, into posts and into your photo area, both

John Jantsch (20:42): Oh into the photo

Mike Blumenthal (20:43): And Google will parse them. I was listening to a Google webinar for product experts. I’m, what’s called the Google product expert where I volunteered that was business with Google. And they really liked what they called selfies were pictures of the products in your business, on the shelf where Google and the consumer could get a really solid idea of what the place looked like and the range of products you were offering. So I think selfies are, if they’ve created a term for it. Yeah. They’re clearly focused on it. And I think it’s the kind of photograph you want.

John Jantsch (21:17): Yeah. Interesting. So in a lot of ways, one of the biggest takeaways for the local business or for the small business is just, you know, do a better job with your images that you’re using. And now there’s some tools that can tell you if you are doing a good job with

Mike Blumenthal (21:32): Well, right. I think you need to think about it semantically. In other words, you need to think about the range of services you offer or the range of products you offer. And you want multiple high quality images in each of those categories that you can drip to Google over time that Google understands as those categories. Yeah. So think about your product and services broadly, categorize them, take multiple images in each check those images against Google’s AI. And then we have found that dripping them into GMB into Google business profile, Google B P G B P, dripping them a couple a month is gonna give you the maximum increase in G B P visibility. For whatever reason, we don’t know quite how Google doing this, but it dramatically increases conversions if you do it that way.

John Jantsch (22:32): Awesome. Well, Mike, it is always great to catch up with you. You are always on the cutting edge of the stuff and testing it out and, you know, seeing real world results. So I love getting your insight on things. You wanna tell people where they might connect with you if they so desire.

Mike Blumenthal (22:48): Sure. So my primary place of writing right now is near media.cl. If you subscribe there, which is you just hit the subscribe button or near media Dosio slash subscribe, we will actually give you a ebook on imagery in Google local to that will summarize all of these things for you, put ’em in a more concrete form and help develop a plan for you. So, and on Twitter and Blumenthal, and to have opening Mentha, and I have open email. These, I always have open email, feel free to email me Mblumenthal@nearmedia.co. I answer every email. That’s

John Jantsch (23:24): Awesome. And I can attest to, at least you answer mine.

Mike Blumenthal (23:27): Well, I didn’t answer the last two you sent me, but that’s cuz I was already setting up my gear.

John Jantsch (23:32): Awesome. Well, my great catching up with you and hopefully we’ll run into you one of these days, soon out there on the road.

Mike Blumenthal (23:37): All right. Sounds good. Thank you very much for having me. I really appreciate it.

John Jantsch (23:42): Hey, and one final thing before you go, you know how I talk about marketing strategy strategy before tactics? Well, sometimes it can be hard to understand where you stand in that what needs to be done with regard to creating a marketing strategy. So we created a free tool for you. It’s called the marketing strategy assessment. You can find it @ marketingassessment dot co not .com .co check out our free marketing assessment and learn where you are with your strategy today. That’s just marketingassessment.co I’d. Love to chat with you about the results that you get.

John Jantsch (00:00): This episode of the duct tape marketing podcast is brought to you by business made simple hosted by Donald Miller and brought to you by the HubSpot podcast network business made simple, takes the mystery out of growing your business. A long time, listeners will know that Donald Miller’s been on this show at least a couple times. There’s a recent episode. I wanna point out how to make money with your current products, man, such an important lesson about leveraging what you’ve already done to get more from it. Listen to business made simple wherever you get your podcasts.

John Jantsch (00:45): Hello and welcome to another episode of the duct tape marketing podcast. This is John Jantsch. My guest today is Melissa Kwan. She is the co-founder and CEO of E webinar. She’s also spent 12 years in startups and built three successful companies without venture capital backing her previous startup a real estate tech company was acquired in 2019 as a revenue driven founder, specializing in sales and business development. She has learned how to build companies with very few resources, something a lot of folks listening can appreciate by automating what she could outsourcing whenever possible and inspiring talented people to join her team with shared focus and enthusiasm. So Melissa, welcome to the show.

Melissa Kwan (01:29): Thanks John, for having me.

John Jantsch (01:31): So I feel like I gave a little taste of it there, but I feel like we should just have you kind of say here’s been my entrepreneur journey. We’re gonna talk about your most current undertaking, but where have you been to get you to here?

Melissa Kwan (01:45): yeah. Great question. So I spent over 12 years in, in startups. UL runs my third company. My first two was in real estate tech. The last job that I quit was at SAP and then previous to that was in real estate. So I kind of just like put the two and two together and created software for real estate. First company was a product company towards agency and then the second company was a SAS product. It was like an open house sign in software. So having done so many live webinars, demos, onboarding trainings for a consistent five years, sometimes five back to back for my previous company, I had just dreamt of a product, a magical product that would do my job for me. Yeah. While I go and have fun. And that became E webinar after that company was sold in 2019.

John Jantsch (02:32): So, so let’s, I guess let’s ask the, you know, what is E webinar? Just give us the like really quick, you know, view of that so we can kind of break it down then a little from there.

Melissa Kwan (02:41): Yeah. So E webinar, the concept is simple. We save people from doing repetitive, boring webinars over and over again. So you can imagine sales, demos, pitches, onboarding, training, product updates, customer interviews, you know, things like that. Right? So you might be running them on zoom right now, or you might not be doing them because you don’t have a person to run them. We turn any video into an interactive webinar that you could set on a recurring schedule or join on demand. So people can consume that content whenever they want.

John Jantsch (03:09): Yeah. So webinars have certainly been around for, you know, ages, internet ages, I guess, you know, 15, 20 years peop marketers have been using them, certainly live, but recently eight, 10 years ago, it seems like this platform of going and signing up and sort of watching a live , but it’s recorded. You know, that, that technology, there are half a dozen, at least you probably know ’em all, you know, people that are doing that. What’s when people say, oh, how is this different than blah, blah, blah.

Melissa Kwan (03:40): Yeah. I mean, so first of all, we don’t do any live webinars. Yeah. Right. We don’t, there is no live audio. There’s no live video. Like enough people are solving this. Yeah. Like down to like Facebook live Instagram live, like everyone in the world is trying to solve this and it really solving it and doing a great job. So what we wanted to solve was the next phase of that. How do you scale a live webinar or a presentation that, you know, works for you? Yeah. Like if you’re doing, you know, a lead gen kinda customer interview type webinar, once a quarter, how, what kind of impact would that have on your business if you made that available every single day. So that’s really, that’s the space that we’re focusing on. And if you, if anyone that’s listening to this right now thinks to themselves, Hey, I’ve seen those before.

Melissa Kwan (04:25): Right. But it’s a little bit scammy. You’re right. And that’s why we exist. I was also in my previous life looking for something that would do this particular thing and everything I found was almost like designed to deceive consumers, to trick them into buying something or create false scarcity, which isn’t what sales and marketing is about. It’s not what branding is about. Right? It’s about delivering a beautiful professional, authentic experience that reflects your brand, but also an experience that allows your customer, your prospect, your attendee, to connect with you. It’s not a video on YouTube. A webinar is where you can go and engage and ask questions and get a response back. So what E webinar does differently is we made the investment to build an asynchronous chat system. Just like your Intercom, your Zend desk, any chat bubble that pops up on a website. When people ask you questions through chat, you can, if you’re there hop into respond live, but if you’re not there, it’s totally fine. Cuz when you respond later, they still get your response on email. And I would say no other automated webinar company had actually made that investment to build up that system.

John Jantsch (05:33): Yeah. I mean, there, there’s certainly a place for on demand because you know, you and I are talking it’s 10 o’clock at night for you when you’re talking. It’s uh, dunno what time it is here. Two o’clock for me. I mean, so the, there is a, you know, there is a need in the customer journey to allow people to get the information they want when they want it. So I think the case for having those makes a lot of sense, but the point that you also made is that so many of ’em are trying to fake their live and that there’s pre-canned chat and it says there’s 27 people on right now. and I think everybody realizes that’s all just a scam, but I think we put up with it because it’s like, well, everybody does it. So how did you take on that idea? Or did you just make a decision in the very beginning? We’re not going to be, you know, spammy or scammy like that.

Melissa Kwan (06:22): The thing is John, like the last thing I would want is to build a business that facilitates a behavior. Yeah. That’s the bottom line. Yeah. So very early on, we looked at all these players and we thought, okay, like there’s a reason why they have that because people ask for it, the customers ask for it. Yeah. But what I care about and what gives my business longevity is if your customer likes you, not, if you like me. Right. So in a sense, we’re building for the, a attendee, like that’s the first experience we’re building for. And it’s almost like kind of what Steve jobs does, right? He’s like, well, you can’t have this. It has to look like this. Even if you ask for this is the better experience you have to update your OS. And I think like when you’re specing a business or a product like this, you have to make those decisions to think what is the audience you wanna attract?

Melissa Kwan (07:09): Because the market’s big enough. Yeah. So we wanted to deliver a product with integrity first, which means we had to constantly not put in features and not build features that create that kind of fake scarcity. Right. So we have no simulated chat, no fake sales notifications, no fake counter. Everything is real. You can put in sales notification, but it’s based on your conversion pixel, there is a counter, but you could choose live or accumulative, but it’s real. Like everything’s real. And our chat is one on one between the attendee and the moderator, like none of that fake stuff. Right. So we just made a decision early on to say like, this is just not a business that like, we wanna track those kind of people. And we said like, we came to terms with the fact that it would take us longer to get off the ground. Cause we couldn’t, we wouldn’t be able to win people that already on the other platforms, but that’s okay. Yeah.

John Jantsch (07:59): Well I, let me push back there a little bit because I was on the other platform and I saw this as a, uh, you know, I was on those platforms because I wanted on demand and I just put up with the other stuff. Right? Yeah. But what I want to have with my customers is a long term relationship. Not a short time, I sold you something, uh, relationship. And I think that’s maybe why people put up with those is because they do work in a certain way, but not for the long term. And I think that what you’ve built is for somebody, in my opinion, is for somebody who views their relationship with their customers as a long term relationship, as opposed to I sold you something.

Melissa Kwan (08:38): Well, I would say because we delivered the product in this way. Yeah. Like it is, we mimicked our branding and how we want people to feel to MailChimp. Yeah. Yeah. Right. We wanna be fun. We wanna be a startup, but we wanna be established. Yeah. Right. We want to feel like this is a company they can trust. And that goes down to, you know, the product and integrity. Right. And the features that you have. So I would say like before this year, maybe last year, cuz we, the product’s been line for two years, you would not see companies like Zillow on automated webinars yeah. Or fresh works or catalyst. Right. Like none of those like real established companies would be on there. The people that have been leveraging, those are like a lot of solo entrepreneurs, a of coaches, a lot of like internet cash marketers, but like real companies have never automated what their webinars for this reason. Like they might have a gated landing page or they might have a video with CR YouTube, but that’s not a webinar experience.

John Jantsch (09:36): Yeah. And now let’s hear from a sponsor, you know, everybody’s online today, but here’s the question. Are they finding your website? You can grab the online spotlight and your customer’s attention with some rush from content and SEO to ads and social media SEMrush is your one stop shop for online marketing build, manage and measure campaigns across all channels faster and easier. Are you ready to take your business to the next level, to get seen, get SEMrush, visit SEMrush.com that’s SEM rush.com/go. And you could try it for seven days for free.

John Jantsch (10:17): I, I tell you that one of the features that, that I really love is because one of the things we really want is somebody not just sitting there mindlessly watching, or maybe like having your webinar in a different, you know, different screen while they’re working. And they’re just listening to it is the amount of engagement.

John Jantsch (10:32): One of the things that’s very built in is you have a lot of built in features and templates for getting people engaged, for finding out who they are for creating, you know, a reason for them to say more about the who they are and what they want and what they’re trying to accomplish. And I think that maybe some of the other platforms have that, but I think you’ve really cracked that part. And to me, not only getting rid of the stuff we’ve been calling kind of scammy, I think that to me is probably your best feature.

Melissa Kwan (11:00): Yeah. So we call them interactions, right? Yeah. Um, and I was, when I was coming out with this product, I was also thinking like, okay, let’s face it. Webinars are boring. Yeah. Right. It depends on like how fun it is and how engaging it is. A lot of times if depends on the speaker. Sure. And let’s face it like topic obviously. Yeah. And not, everyone’s a great speaker. And then during live webinar, there’s lots of interruptions. People ask questions, there’s housekeeping. Maybe your connection is bad. Like none of that happens on an automated webinar cause it’s based on a video. But I was thinking like, what is it that you could deliver then put out there that can get your, a attendee to stay till the end so they can take that action. Yeah. If they don’t stay till the end, even if you deliver your CTA, they’re never gonna see it.

Melissa Kwan (11:42): So we, we have these thing called interactions, which are like programmable polls, questions, resources, sales, alerts, you know, things that allow the, a attendee to participate right. In the experience with you. So it’s not like I come in and you’re talking at me for 45 minutes and I’m playing on my phone and you’re losing me to Instagram. Like when you ask me a question, something pops up and I’m actually able to engage with it. Maybe I can see the results and things like that. But on the host side, we actually gather all that data and we deliver it to you in a beautiful, actionable and understandable report. So you can actually see like where are people hitting a thumbs up? Because within any webinar you can hit a thumbs up. It’s more of a consumer experience. Where are people dropping off? Are they answering this question?

Melissa Kwan (12:26): So you can imagine in the past six months I’ve ran my demo. I don’t do live demos. It’s all in new webinar. Of course. All right. I ran it 1500 times. And my first question is, how did you hear about us? Yeah. And about 60 PE like 60% of people will answer that question. So from a marketing perspective, that is such valuable information. Yeah. And the more I run it, the better data I’m getting to, whether it’s helping my business or helping me make a better presentation. Next time, all of that is, is very useful.

John Jantsch (12:55): And I can say, this is not exactly scientific, but we have run this same webinar for many years. And you know, we’re always tweaking a little bit. I will say that our completion rate has significantly increased since moving to ewe R now I will give one caveat because of all the interaction we’ve actually changed how we’re presenting this information BA you know, because we’re, we feel like we have all these engagement tools now. that? Yeah. So, so it’s changed a little bit about how we’ve presented the information, but I can tell you that, you know, 35 ish percent higher rate of completion than using another platform.

Melissa Kwan (13:35): I mean, we have a customer that took the exact same video. Yeah. And put it into E webinar and their engagement and completion rate went up by 50%. Like they did nothing at all. So that’s why, like, we, we encourage people to just give it a try. I think that one of the biggest pushback we have is like, well, if it’s a video, then why don’t I just use YouTube? Yeah. Yeah. And it’s just the mindset of it, isn’t it? Yeah. Like, yeah, you get a registration page, you choose it time. There’s reminders, there’s follow ups. And then it starts at a certain time. Or you can watch it on demand. Like, I, I know earlier you said like there’s a place for, on demand for webinars particularly, but like, it’s so interesting how in our everyday lives, like as consumers we expect on demand video content.

Melissa Kwan (14:18): Yeah. Like when was the last time you didn’t watch something on apple TV or Netflix or Amazon, like I expect to go there and press play and watch it at my own time. However, for some reason, for B2B content, you have to come to my show right next Tuesday at 11, my time zone. So there’s a bit of a disconnect, right. So I think it’s not only like there’s a place for on demand and B2B content. I think it’s already here. And the people that understand that will be able to use that as a differentiator in their business.

John Jantsch (14:50): Yeah. That’s such a great point. I think again, it’s one of those things where we just get used to it. It’s like, well, that’s the way we get to, you know, consume this content. But a lot of behaviors, especially buying behaviors and things really do get influenced by the way that we behave every day in life. And just your example of the streaming, you know, programming, I mean like TV guide, what’s that right? I mean, I just go and I, yeah. You know, I watch the program when I feel like watching it. And I think that kind of behavior or habit that gets developed really should be something that we’re looking at and saying, that’s how everybody wants to shop now. Or that’s how everybody wants to get their content. Now.

Melissa Kwan (15:28): I mean, another great example is like texting, like who calls now? Like maybe your family member, you’re like, Hey, I’m outside or I’m downstairs. Or, you know, if you’re in your car, like maybe you’ll call on a headphone. And we have some people that are looking at E webinar. Maybe they’re moving from zoom, cuz they’re like just absolutely exhausted from running these live webinars and they just have to scale. But one of the questions they have for us is, well, if you don’t, if I can’t answer people right away or using my voice, are they gonna be mad at me? Like, does that mean worse? Does that mean worse customer service? Because I’m used to doing this live thing and I’m used to making people feel, feel special by calling out their name or answering the question. But my response is always just give it a try because I think your customers, like you’d be surprised at how your customers would prefer tech space and how much more manageable all that Q and a is. If it is text space

John Jantsch (16:28): To, to totally agree. And just going back to E webinar, another thing that I think people will enjoy, you talked about trying to make it fun. I think the interface itself is actually, um, easier to set up and easier to, to operate, uh, and get a webinar going than a lot of the other platforms as well. So you’ve think you’ve conquered a number of the things that competitors aren’t doing. I do wanna talk a little bit about just the business of building this as well. You know, from a text import first, I should have asked you in the beginning, are you an engineer or programmer yourself or

Melissa Kwan (16:57): No, I wish I, I wish, yeah. I wish I was an engineer cuz otherwise it would be feature complete by now. so nothing would be ever wrong with it.

John Jantsch (17:06): So, so what’s been the hardest part from a tech sample.

Melissa Kwan (17:10): Oh my gosh. Like I, it is a constant battle every day, but what is the hardest? I would say the one thing, I mean, of course the first thing is just scaling. Cuz as you build a business as like, you know, people start having a thousand people in a webinar. Yeah, yeah. Or you have two of those and now there’s 2000 people and everyone’s sending a chat. Right. And then, but you can’t test for that scenario until you get there. right. So the first six months was like acquiring these customers, but then what do you do? Yeah. What do you do when everyone has it on Wednesday or everyone has it on Tuesday. Right? So we’ve kind of solved that. But believe it or not, one of the most difficult things to solve is just the flexibility, like offering complete flexibility and scheduling and also the ability to track all of those things in a report, right?

Melissa Kwan (18:04): Like all the chat and all the interactivity, like we’ve worked that kind of stuff out. But right now, give, give you an example. People are asking for the ability to pause. So say I’m running a workshop. I wanna say, okay, I’m gonna let you pause for five minutes. You can finish this worksheet and then you can press play or it’s gonna start on its own. I still don’t understand this, but apparently it messes with the timeline of the video and then it messes with all the analytics. Yeah. so it’s just little things like that, that like me and you may never think about that. We’re very happy that they’re engineers for.

John Jantsch (18:36): So, so I was gonna ask you what your most requested feature is. New feature is, and that maybe you just revealed it.

Melissa Kwan (18:44): We have an ongoing wishlist of features, but definitely what you’re gonna see next is a full facelift of our attendee experience. So what we have right now is I think it’s two, three times better than what’s out there. But what you’re about to see is something that will be 10 times, 20 times better than what’s out there because we wanna really deliver an experience that’s less businessy, like less zoom and way more consumers. So what we’re taking inspiration from is not the webinar solutions that are out there. Yeah, yeah, yeah. We’re taking inspiration from like Twitch or gaming companies or you know, apple TV, like those kind of things and see like how people actually wanna consume interactive video because this is what it is, right. Call it in a webinar automation software, but it is interactive video. So how do people wanna engage and consume that content and feel like, you know, they learn something and that and feel delighted. Right. I think delighted is the word.

John Jantsch (19:47): So are you one of those people that I could say, you know, what’s the vision for this company three years from now? Or are you really still trying to, you know, wrestle with the momentum of the moment?

Melissa Kwan (19:58): The only thing I care about right now is getting to profitability. so as a business owner, you probably understand that. Yeah, absolutely. So I would love to not be, you know, burning money, but I just want, I wanna see maybe not even the three years, like, like next year, I really wanna see people’s mind shift away from like Mo moving away from doing repetitive live webinars and just understanding that there’s a better way. Yeah. Cause all it takes is a flip, right. Cause right now this is what, you know, you’ve been doing it for 10 years. Webinars is have actually been around for 20 years. Yeah. But there is a new way of doing things that is not just better for you. Right. Freeing up your time. So you can, you know, spend more with your friends and family, but it’s actually better for your customer. Yeah. To have access to that information when they can consume it. Like the average attendance rate for all of our customers is 65%. Yeah. And that is outrageous. Yeah.

John Jantsch (21:00): Well, and I think I love about it and I think people need to, you know, customer journey, we can design the most perfect customer journey. People are gonna go through ’em the way that they’re gonna go through them. And I think that’s what, you know, a lot of times, if they can go through three or four stages of the customer journey one night, because that’s what they were really , you know, amped up about. I think that, I think we, as marketers have to realize that we just have to offer that flexibility.

Melissa Kwan (21:24): Um, yeah. I mean, I’ll leave you with one stat that I love from trust radius. 87% of buyers prefer to do their own research sure. Through their buying journey. Yeah. And 57% already make a purchase without talking to a salesperson. Yeah. Yeah. So you can actually make transparency and access to content your differentiator. If your competitor is gating everything, making people book a call, not making their webinars on demand and making it just difficult for people to get the information they need to make a decision, then they’re gonna go somewhere else.

John Jantsch (22:02): Absolutely. Melissa advi tell us where people can find out more about the product and connect with you.

Melissa Kwan (22:11): Yeah. If you wanna connect with me, LinkedIn is best. So my name is Melissa K w a N. And check out E webinar. If you’re curious how it works, there is, uh, an on-demand demo of course, delivered through E webinar in a very meta way. And it’s exactly as it sounds, ewe.com.

John Jantsch (22:25): Awesome. Well, Melissa, it was great. You know, I’m a fan. I, you know, love the product itself and answered something we were looking for. So we were happy to find it. And hopefully we’ll appreciate you stopping by the, take some time on the duct tape marketing podcast. And hopefully we’ll run into you out there on the road one of these days.

Melissa Kwan (22:42): Thanks so much, John.

John Jantsch (22:43): Hey, and one final thing before you go, you know how I talk about marketing strategy strategy before tactics? Well, sometimes it can be hard to understand where you stand in that what needs to be done with regard to creating a marketing strategy. So we created a free tool for you. It’s called the marketing strategy assessment. You can find it @ marketingassessmentdotco.co check out our free marketing assessment and learn where you are with your strategy today. That’s just marketing assessment.co I’d love to chat with you about the results that you get.

John Jantsch (00:01): This episode of the duct tape marketing podcast is brought to you by business made simple hosted by Donald Miller and brought to you by the HubSpot podcast network business made simple, takes the mystery out of growing your business. A long time, listeners will know that Donald Miller’s been on this show at least a couple times. There’s a recent episode. I wanna point out how to make money with your current products, man, such an important lesson about leveraging what you’ve already done to get more from it. Listen to business made simple wherever you get your podcasts.

John Jantsch (00:47): Hello and welcome to another episode of the duct tape marketing podcast. This is John Jantsch. My guest today is Mike MCIT. He’s the author of get different fix this next clock worth profit. First, the pumpkin plan and the toilet paper entrepreneur. He is also the founder of profit first professionals. The profit first professionals organiz organization is designed to support accountants, bookkeepers and other financial professionals to substantially differentiate themselves in the market. We are gonna talk about one of Mike’s old books because he’s come back and revised. It really added a lot of new content to it. Evergreen important topic of getting more done managing your time. So Mike, welcome to the show. This is at least your third or fourth time here.

Mike Michalowicz (01:32): Yeah. Awesome. To move back with you, John. Thanks. And thanks for the pre-show conversation. I was fine. Oh yeah. We had to get around and start recording some of this didn’t we so clockwork.

John Jantsch (01:41): This is a question I always ask people when they revise books, you know, David Meerman, Scott’s been on this show. I think he’s on like the eighth version or ninth version of his oh, the new rules, new the book. So I was like trying to tell people, I know there’s a whole lot of new stuff. We could go down a laundry list of it, but if I’m that person that already owns this book, like convince me why I should go out and buy another copy.

Mike Michalowicz (02:02): Yeah. So it’s 60% brand new. Wow. And 40% of the original content has been adjusted. So for fluidity, basically there’s two reasons why I do a revising expanded it’s so only the second time I’ve ever done one, um, is if there’s growing demand on the topic. So do I see the book there’s continuing and growing demand for the book?

Mike Michalowicz (02:21): And there is in this case, secondly, is there regular points of confusion? So I’m really fortunate to get emails from readers telling me what’s working, but also what’s not working. And there were, was a few significant sticking points under our belt for the last, I think the prior book came out four or five years ago under our belt. We have now thousands of implementations, we have a training institution or school or whatever you call those things, training curriculum that our, uh, readers can choose to go through. And we’ve now over a thousand student, over 2000 students, I’ve gone through that program. And so we get feedback, oh, this is what’s working. This is, what’s not working. This is why I’m confused. And my goal with a book is that no one needs to ask a clarifying question that every ounce of content’s in there, cause unlike a speech or a class or a workshop where student can raise their hand, say, can you give me more details?

Mike Michalowicz (03:12): Or another angle in a book, you get one shot the sentence it delivers or not. So it was stripped down to the bare bones infrastructure of the book reorganized and I rebuilt it out. So I think it’ll be easier, faster, better. You know, one of the things that I think as an author, you know, you’ve maybe taken your past and you put some examples and things in, but you know, 2, 3, 4 years down the road, you’ve heard from lots of people, you’ve got all these like rich treasure stories of stories. Right. And I think that’s, you know, don’t, you wish you had those in the beginning, right? I mean, that’s what really makes you write your first book. You, when you write your first book, you don’t have much practical experience. At least for me. Yes. I have people that I teach on the side, you know, is it my side hustle to my author business on how to do this.

Mike Michalowicz (03:57): And we had our workshops running for a year in advance, but there’s something different once the book is out, because you hear back from people that never go through any of those experiences, just read the book, telling you what’s working. What’s not those become good stories. And of course people have gone through it. So I, I mean, I’m biased, but it’s a markedly better book I believe.

John Jantsch (04:13): Yeah. Well the, the good news is you had a lot of experience with toilet paper when you wrote your first book. So that helped. Right?

Mike Michalowicz (04:19): that’s all right. Go straight for the potty humor. Shall we? No. Yeah. A little punch guy. Oh, all right. So you know, it’s really, uh, it’s really popular. I think for, you know, hosts like me to ask questions. Like, so what’s been your biggest learning, but I know that as you continue your write books, you are so engaged with the people that you work with.

John Jantsch (04:37): I think it’s fair to ask you. What’s been like a new learning for you. Like what’s been a big aha that you’re like, I don’t know why I’ve never considered this, you know, but this is, you know, this is now how I think about my business.

Mike Michalowicz (04:49): Yeah. So, okay. So I had a call. This is not in clockwork. I’m working on another book called all in I’m like, this was the defining moment for this book you ever have you ever have that moment where you’re like, God, I can’t find any good employees. And I’m saying this rhetorically, but that’s how I felt. You know it, some employees are great. Some are not a fit. And the feedback is higher. Slowly, fire quickly. If someone’s not working out, you gotta get rid of ’em fast. Right. And I’m like, gosh, how can that always be true?

Speaker 1 (05:15): Cause it seems like there’s always this churn of firing and you clean on a few good people. I got a call from this place in Texas. It’s a barbecue. It’s called Kings smokehouse or Kings barbecue smokehouse. And the owner, his name’s actually Stephen King. But not that Stephen King called up and said, I took, I bought this place. Which first of all, I’ll never buy a restaurant. yeah. Secondly he said, I took over and he goes, uh, these employees, many of them were just not a fit. They were bad employees. I had to fire his people. He goes, but I couldn’t afford to fire people particularly post COVID. Right?

John Jantsch (05:47): Yeah.

Mike Michalowicz (05:48): So instead he goes, I tried this thing, I gotta tell you about it. He employed. He didn’t even know that there’s a technical term out there called psychological ownership. And he goes, I employed it without knowing what it was.

Mike Michalowicz (05:59): And so I’ve been researching this. There’s an interesting phenomena. You gotta check this out called psychological ownership. What it is, the feeling of possession without legal possession necessarily. Right. And ironically legal possession does not constitute the sense of ownership sometimes actually generates the opposite. So ownership to defining that is where we are all in on something. We, this is important to us. It actually is defining of ourselves as part of our purview, I guess. So when you hear someone say, this is my company, they’re showing a sense, psychological ownership over as opposed to this is John’s company. That where there’s a detachment. So what’s interesting is that I, the analogy I use is like renting a car. When I rent a car, they give me responsibilities care for no scratches, fill gas. When I leave that place. After the hundredth ID check I’m in that freaking OCN, I’m crunching down on the gas pedal, I’m hitting the brakes.

Mike Michalowicz (06:52): I’m hitting the curbs. I don’t really care about this car because I’ve been assigned some certain responsibilities to adhere to. I don’t have a sense of ownership. Now, the irony or the interesting thing is when I do own something like I own a car at home. That one I don’t mess around with, but here’s the ironic part. I don’t really own it. I’m making my payments to the bank that they’re the legal owners. I just have psychological ownership. So with this guy, Steven told me, he’s like, oh, I started to give people ownership, which is slightly different, subtly different, but significantly different ones. Outcomes than responsibility. Responsibility is clean. The clean, the inventory room, stock everything correctly. So there’s this one guy Joel’s a long answer, but there’s one guy, Joel, who I interviewed subsequently who was by all definitions, a horrible employee showed up late to work.

Mike Michalowicz (07:39): Steven hired Joel because his friend asked him to do him a favor, which is the worst way to hire someone. He was a mechanic, not an employed mechanic, but he’s working on his own card all times. So he was covered with grease and he was supposed to be a new waiter after one week. Steven’s like, I gotta fire this guy. He calls his friend, says, I’m. He says, give him one more week. Steven acquiesce is and out of a, kind of a hail Mary Steven goes to Joel and says, Hey man, it’s really, all this stuff is really difficult. I wanna give you ownership over something. Use those exact words. And there was this little box of straws on the bar. You know the one, when you pulled the one straw out and all the other straws kind of falling out, he goes, I wanna give that to you.

Mike Michalowicz (08:15): Meaning your job is to maintain that. Anyway, you sit, see fit. We’re gonna call it Joel’s straw box, maintain it. And Joel started doing a good job with it for the next few hours in the next day. And then Steven says, well, Hey, you’re doing a great job with that. Do you wanna own the bar mat? This guy Joel says, okay, starts controlling it fast forward. He starts this cascade effect fast forward. Now this is two years later. Joel’s his best employee. He does anything for the company. He goes above and beyond. What’s asked of him when he sees an opportunity to fix something, he fix it cause he acts like an owner. So I called Joel. I said why? And he says, listen, he goes, you don’t know anything about my background? I had a horrible background. I was abused as a child. I was told I could never own anything.

Mike Michalowicz (08:59): And that was the first time in my life. I was given control over something. The ownership, he goes, I’ll do anything for this company. And as I was wrapping up the call, I said, Joel, I heard that you’re into repairing cars. Tell me about that. He says, yeah, he goes, I love repairing cars. I wanna be a race car driver one day. That’s my dream. And I said, dude, the way you’re going, I think this is gonna happen. I said, it’s gonna be such a loss for the barbecue house. And there was this long pause and Joel looks back, we’re doing over zoom. He looks right in the camera. Like he’s a pro. And he goes, I’m never leaving the barbecue house. I’m gonna be a professional race car driver and still work there. I was like, no, how do we find people? Like you?

Mike Michalowicz (09:34): He didn’t have to find the a player. Yeah. He simply started mastering there’s many elements to it, but he started to master assignment of ownership and Joel’s behavior and other people’s behavior, radically changes. I know who his first sponsor’s gonna be right on the car. Right? Big, big barbecue patch on his. Exactly. Right.

John Jantsch (09:53): All right. So that was a great answer. I have a flip sort of side of that one. I asked you kind of, what’s been a new aha for you. What’s hard now. And we are gonna talk about the book I promise, but I just wanna take the advantage of the years of experience from you. What’s hard now that maybe didn’t used to be okay. So here’s what I didn’t expect is my goal was not to run all these different, I didn’t wanna run businesses besides selling books. Like I’ve done that.

Mike Michalowicz (10:26): It’s okay. It’s I have nothing against it, but I wanted my primary business to be books. But now as a business has grown, we’ve always partnered. It’s the challenge is ensuring that every partner is served to the level they wanna be served. So instead of me owning all these different businesses, like we started a business for this new book, all in this that’s two years away. Yeah. I gotta take care of that partner and be a service to them. Clockwork new book has a partner and I gotta be a service to them. And I didn’t really anticipate the challenges there of catering, but catering a way that there’s balance that everyone’s represented fairly. And the interesting thing is sometimes they raise their hand and say, but I’m not being treated fairly. And it’s like, we have to show the documentation. Like we’ve done the exact same thing for everybody else.

Mike Michalowicz (11:08): What we’re trying to do is rise. The tide and your boat will rise, but you know, the licensee fairly enough. But what about my boat is always, you know, their boat and not the, which from my perspective, I can’t worry about the boats. I gotta worry about the tide. So that striking that balance is a delicate court is necessary. It’s important. It’s just a little harder than I thought. I thought the boat, the tides rising, we’re all good. But uh, I gotta watch for the boats too with them.

John Jantsch (11:28): And now let’s hear from a sponsor, you know, everybody’s online today, but here’s the question. Are they finding your website? You can grab the online spotlight and your customer’s attention with some rush from content and SEO to ads and social media. SEMrush is your one stop shop for online marketing, build, manage, and measure campaigns across all channels, faster and easier.

John Jantsch (11:54): Are you ready to take your business to the next level, to get seen, get SEMrush, visit SEMrush.com that’s S E M rush.com/go. And you could try it for seven days for free.

John Jantsch (12:08): All right. Let’s, let’s talk a little bit about clockwork. There’s a lot of ideas in here that, you know, maybe have been incorporated in some fashion in some other books, some other courses, some other people writing. Sure. So I wonder if you could talk a little bit about really what’s been your inspiration in terms of your own. I mean, essentially this is a time management, you know, book approach. What’s been your inspiration for developing that. Yeah. I mean, I think the inspiration is, I think it’s not time management, but that’s the benefit. Yeah. To the owners. I think what it really is empowerment team empowerment and building processes and systems, which then brings back time management so we can hone in what we wanna do.

Mike Michalowicz (12:46): Yeah. So I think that’s the starting argument I make. I think one of the big parts is team empowerment. So one of the kind of pinnacle tests of the book is what I call the four week vacation. And in, in my research of the companies, I analyze 90 X percent plus identified that if the owner was away for four weeks, that the business was experiencing all the elements of its business cycle within those four week periods. So in theory, if I could leave for four weeks, I could leave into perpetuity because everything’s happening during four weeks and these monthly cycles. Yeah. Yeah. But then the fear was like, oh, if I leave for four weeks, my employees make, oh, you’re making money off of my sweat. Mike goes to the beach and or the mounds with John and all I do is work. So that was the fear of what I found and why, including the book.

Mike Michalowicz (13:32): And there’s actually now every chapter has a section for employees is that this is actually an empowerment opportunity. We, as business owners act like superheroes. Yeah. We swoop in can fix anything. Cause we know everything about the business, but we lead this wake of damage behind us, or we interrupt someone’s ability to take true accountability over something because we swing and take it. When I left my business, I’ve been doing this for five consecutive years. Now when I leave my business each year for four consecutive weeks, I come back and my employees consistently say, oh, I feel even more empowered. I’ve taken on these responsibilities. Yeah. And then the interesting thing too, I, including this book, we tested our own business three years into this. So two years ago, every employee started taking four vacations. And it’s not, it is a benefit to my teammates, my colleagues here, but the real benefits back to the company, because if Jenna or Jeremy or Izzy, or one of our teammates leaves for four weeks in their absence, we have the cover for them.

Mike Michalowicz (14:27): So there’s this backup and redundancy that’s being trained. And, and the final assessment’s this everyone’s leaving for a period of time at some point. Yeah. Because they retire, maybe illness, an accident happens, life events happen. So this for vacation concept is something that I think the entire company should be doing to prepare for the inevitable and to strengthen the company.

John Jantsch (14:47): I had three employees go out on maternity leave at the same time. One time, you know what 10, oh my gosh. But it is reality. So I think we can prepare for that. I actually, the, just this year took myself and my director of operations were both out for 10 days at the same time. And we were actually on lake Powell, which we have no signal at all. So there, there was zero ability. Cause every now and then, you know, you’re like, well, let’s just make sure there’s no disasters.

John Jantsch (15:13): Right. But there was no ability to, and you’re absolutely right. People, we came back and people were like, let me tell you what I did. Right. I mean, it’s pretty cool. Yeah.

Mike Michalowicz (15:21): Yeah. You know, you know, the biggest interrupt to that. And I read about it in the book too is for, at least, for me was my own ego. Yeah. When I was away after like day two, I’m like, oh my God, I need to check in. Right. Like what are they doing? The place is burning down. And then I need to SWO in. But then when I came back and they said, they don’t need me. I’m like, oh, you don’t need me. And like, the tears were welling up inside. Like I’m not needed. Yeah. But it was once I started really understanding that this is a form of empowerment that I again, then kind of got my ego back in check and said, okay, this isn’t just about me.

Mike Michalowicz (15:50): This is about my teammates and elevating them. Yeah. Yeah.

John Jantsch (15:53): So, so there’s a big concept in the book, the four DS doing, deciding, delegating, designing, you can unpack that a little bit, but I was happy to see. And it makes total sense that you had it a 50, which is downtime, which we’ve been talking about a little bit. So go ahead and maybe do your quick spiel on unpacking the five DS.

Mike Michalowicz (16:09): Now I, yeah, so there’s, this is there’s four stages of a business and the business has to be serving all these. But when I say stages, we as an entrepreneur can elevate to the fifth, the fourth stage and, and implement the fifth. So the first stage is doing is the activity that a business must do to generate revenue, to be a service to clients. But it’s also the structural work that needs to be done.

Mike Michalowicz (16:29): So I create furniture that I sell the clients, that’s a doing activity, but also the invoicing, all the administrative work behind that is all doing work. A business, an optimized business will spend 80 to 90% of its time there. The next level up is deciding is necessary, but only in short spurts, it’s kind of like that adrenaline kick. It’s good for you until you have a heart attack. Yeah. And so deciding is where the manager, or in many cases, the business owner themselves is making decisions for other people. So, and so goes off to do the work. I TaskRabbit. They come back a second later and have a question, oh, do I sort invoices by first name or last name? And I think about it and I give them a decision. I call it colleague, it’s an Indian goddess with one head and eight arms.

Mike Michalowicz (17:08): The vast majority of small business lives in the deciding trap. One person being the brains for the entire organization. And it limits it to about three people. Four people max can work there. Yeah. To get past that with the move to the next D, which is delegation or delegating, delegating is not the assignment of tasks. That’s what we think it is. What delegating truly is the assignment of outcomes. It’s about that empowerment. You know, we agree you and I’m your employee. You say, here’s where we need to go. Mike, do you agree? And do you understand why? Yes. Here’s what my thoughts are. Guess the outcome, we have a best practice, you know, way we’ve historically gotten there, but your job is to get there no matter what. And if there’s a disruption or a better idea, take that. And you know this, when I come back with a question, say, Hey, John, I have a question.

Mike Michalowicz (17:47): The response is no questions. I hired you for your brain. Mike, go and figure this out, get to that outcome. Yeah. So that’s true empowerment of employees. And that moves us, the owner to the ultimate stage, which is designing, designing is visioning the goals and outcomes for the business and then strategizing ways to get there. This is the hardest work yet. We think it’s the easiest. We think doing’s the hardest. That is the easiest. It’s easier to dig a hole than it is to solve a Rubik’s cube for most people. Yeah. So most people would rather just sit there and sweat it out, digging a hole than thinking we’re making great progress, but we got to get the puzzle aligned in the right direction to move our business forward. So get out of doing and start envisioning where your business needs to be. The last part is downtime.

Mike Michalowicz (18:27): There was a study came outta the UK. This is a new addition to the, they identified that the average knowledge worker produces 3.2 hours per day, regardless of hours work, you work eight hours, you’re producing 3.2, you work five, 3.2. We need to recover. So intentionally give your colleagues downtime. And we do it through breaks or interns. We hire a lot of part-time employees. In fact, the vast majority of our staff is part-time. So downtime is on their own time. We give our part-time workers, eight hours of project work, traditionally eight hours of work, they get done in four or five hours. So clearly eight hours things. It’s kind of a ruse. It’s really about the project output. And we do the sabbaticals all to recover emotionally and physically with through downtime.

John Jantsch (19:08): Yeah. There’s a lot of, a lot of companies actually like a number of countries studying that whole idea of the four day work week.

John Jantsch (19:14): And you know, the fact that people are getting as much done because we just, you know, we don’t fill it up with silly meetings or acting like we’re working.

New Speaker (19:21): That’s right. We, we were trying to hear we’re small. You know, my, my author office were 10 employees and we cut it to a four day work week, two years ago, partly cuz of COVID kind of forced it. And so we, no one works Fridays except for me. I choose to. And my gosh, the output is the same. It’s not higher. And people come so refreshed on Monday. There’s I asked employees a few days ago. I’m like, how does Sunday night feel? I’m excited. It’s a change up again. I’m coming back to work where before it was like, oh my God, the weekend flew by, do I have to go back to work?

John Jantsch (19:50): So one of the, I am totally on board with, you’ve gotta get outta doing and get to designing. There are some people that just, well, Mike, let me just say, I think you’re a doer. I mean, you are like an action taker. You like to like funnel with the stuff. Right. So does that make, and I think a lot of business owners are that way. So how do you get the right balance? I mean, especially you bring in people to do the doing and you do, you know, so, so not, I mean, you’ve got some people that 80% of their work is doing right. And you’ve got, obviously the business owner should be spending more time designing, but how do you get them to let go? Because I think that’s probably,

Mike Michalowicz (20:25): yeah, you gotta go into what’s called collective. Yeah. It’s a big challenge. You gotta go into what’s called collective design. Yeah. So it is not the natural tendency for a lot of people.

Mike Michalowicz (20:33): In fact, most people who are doers today start a business because they say I’m already doing this. Right. I might as well continue to do it on my own, which is basically a freelancer. So we don’t have the natural 10 or perhaps capability. Yeah. But when you bring in your collective team, then you can do brainstorming and strategizing and the collective brain can be of service. I suggest of doing that. If you do that, don’t have the meetings in the office where the regular routine is kind of distracting, overwhelming, get outta the office once a week or once a month, just for a few hours and say, here’s the biggest challenge we have. What’s everyone’s ideas. The other thing is if you get bigger, you may even want to bring in a person that is a designer. Yeah. Someone that can work on that strategy.

Mike Michalowicz (21:11): Yeah. The risk for owners though, is, you know, it’s a big blow to the ego. In certain cases I’ve seen owners take on who they thought were next level designers, executives from these large corporations and stuff. And there’s a total disaster. Yeah. Because small business ownership, you get your hands dirty, big business, you know, you’re kind of pulling strings. And sometimes there disconnect between the pulling of strings versus actually designing in the trenches.

John Jantsch (21:34): So I noticed you had Geno Wickman, the author of traction and created dos system. Right. New forward for the book. Would you say clockwork for, particularly for people out there who are familiar with the principles of Vos, would you say they work pretty well together? Yeah. Yeah. And I think that’s why Geno wrote the forward. So Geno talks about there’s different phases of the entrepreneurial journey versus just the idea starting up.

Mike Michalowicz (21:56): He actually wrote a great book called the entrepreneurial leap. Yeah. It’s a great book on like, should I do this? Should I stay? Or should I go, as the song goes, listeners, go back and you can find my interview with Geno on, on when he came out with that book. Go ahead, Mike. . Yeah. Yeah. And that’s a, it’s a fantastic book. Then when he wrote EOS or traction, the entrepreneurial operating system, it really requires that first level of management, second level of management to be in place. It’s not just one person doing it cause there’s a lot of components. Yeah. So he’s like, there’s this bridge here and clockwork fails it. Clockwork is designed from that few employees, a handful of employees up to 25, 50 employees. We have some people that have a hundred employees doing it. And then clockwork has run its life.

Mike Michalowicz (22:35): Once you get past that 50 employees, there’s this level of sophistication that starts kicking in where EOS is idyllic for that, it has rhythms and so forth. Clockwork is not about that. It’s about bringing a non-efficient business to a, a pretty proficient level of efficiency, proficient efficiency. And then Geno’s book takes a little bit further. So he wrote the forward cause he saw this as the bridge between his two books.

John Jantsch (22:57): Mike tell people where they can find, I know you’ve got a number of places, but obviously find more about this book, catch up on any of the books that you’re working on. And obviously all of the various programs that you.

Mike Michalowicz (23:08): so clockwork.life. Cause we, I believe is a lifestyle. clockwork.life is where you can get stuff on this book and me, you can go to my site, no one can spell MCIT. So while Mike MCOW exists, the shortcuts Mike motorbike.com because I used to have as a nickname, it’s only grated nickname I’ve ever had.

Mike Michalowicz (23:24): So the other ones were not usable on the web. So Mike motorbike.com and uh, you’ll get stuff on the books and clockwork.life for the books was, oh,

John Jantsch (23:33): you and I have been hanging out so long that my spell check knows how to spell MCIT. So got that.

John Jantsch (23:37): That’s a victory. That’s a victory. Mike, always great catching up with you. And uh, hopefully we’ll run into you one of these days out there on the road again soon.

Mike Michalowicz (23:45): Oh, that’d be great.

John Jantsch (23:46): Hey, and one final thing before you go, you know how I talk about marketing strategy strategy before tactics? Well, sometimes it can be hard to understand where you stand in that what needs to be done with regard to creating a marketing strategy. So we created a free tool for you. It’s called the marketing strategy assessment. You can find it @ marketingassessment.co not.com.co check out our free marketing assessment and learn where you are with your strategy today. That’s just marketingassessment.co I’d love to chat with you about the results that you get.

John Jantsch (00:00): This episode of the duct tape marketing podcast is brought to you by business made simple hosted by Donald Miller and brought to you by the HubSpot podcast network business made simple, takes the mystery out of growing your business. A long time, listeners will know that Donald Miller’s been on this show at least a couple times. There’s a recent episode. I wanna point out how to make money with your current products, man, such an important lesson about leveraging what you’ve already done to get more from it. Listen to business made simple wherever you get your podcasts.

John Jantsch (00:46): Hello and welcome to another episode of the duct tape marketing podcast. This is John Jantsch. My guest today is Jeb Blount. He is the CEO of sales gravy, the author of 14 books, including fanatical prospecting, sales, EQ objections, virtual selling, and his brand new book. We’re gonna talk about today, selling the price, increase the ultimate B2B field guide for raising prices without losing customers. So Jeff welcome to the show.

Jeb Blount (01:15): Well, thank you so much for having me back. I always love to be on your show. It’s one of my favorite podcasts.

John Jantsch (01:20): Thank you. Thank you so much. So, you know, one of the things interesting, I know a lot of the book, you talk about a salesperson that has an account that has to go out and you know, it’s like, oh, we’ve had this cost come. We have to raise prices, but I will tell you working with so many small business owners, they’re not charging enough right now. And one of the things I tell them all the time is you’ve gotta go raise your prices. So a lot of that’s kind of in their head, isn’t it? I mean, it’s like, I don’t think I can get this, or I don’t deserve this or whatever it is.

Jeb Blount (01:49): Yeah. You know, there, there is the, I don’t deserve it. And I think that’s, I think that’s a very common feeling with small business owners, especially when they’re dealing with bigger companies. And I know that as a small business owner, as you know, a company that’s growing I’ve, I’ve often felt the same way that maybe I don’t deserve this and that to somewhat some, you know, some extent is something that is totally in our heads, right? That it’s a lie that we tell ourselves. And I mean, there may be some cases where we don’t deserve it, but in most cases we do. But on top of that is, you know, the constant fear of the business owner that if I go ask for a price increase, I’m gonna lose my customer. I’m gonna lose the orders. Maybe they’ll throw in my face. Something that went wrong in the past and well, there’ll be conflict. And, and of course there’s a potential that they just say, no, and I get rejected. Yeah. And that makes me feel really bad. So, and those fears by the way, are things that we make up in our own head that we have to get past. And some of those fears could be true. I mean, you could go in and create a lot of problems if you haven’t been taking care of your customer and then you go ask for a price increase.

John Jantsch (02:51): Right. Well, and so, so the sales rep of course like a business owner, a lot of times I tell them, you just gotta, you gotta understand the value you bring and go ask for the money. But a sales rep, a lot of times, I mean, somebody told them, go tell the client, the right is going up. Right. It’s not, you know, it’s not my fault, but I’m the one that has to deliver the bad news. And I might lose that commission. Right. Because they go somewhere else. So, you know, how do you, I mean, be in that particular instance, you know, how do you get over that kinda head thing? It’s like, it’s not my fault, but I gotta deliver the news.

Jeb Blount (03:23): Yeah. Well the, with the salesperson, the same fears are in play. So the, one of the biggest problems for salespeople is the boss says, you gotta go get a price increase. Right. When I, it wasn’t uncommon. You know, when, back when I was working for a boss that they would come in, bring you your accounts and say, we need 6% across the board. Go figure it out. Right. And you know, you’re sitting there like rolling the dice on which customer are gonna take the price increase too. And very much like when we were talking about, you know, the business owner says, well, I kind of don’t deserve this. I think salespeople get the same thing in their head. We don’t deserve this. Or in a lot of cases, they feel like they’re doing something to their customer versus doing something for their company. And by the way, that’s, that is exactly true for the business owner as well.

Jeb Blount (04:03): Sure. So for me, you know, the, I, you know, I just like everybody else, I’ve experienced the anxiety of having to do a price increase as a salesperson. And I’ve experienced the anxiety of having to deal with price increase as a business owner. And one of the things that helped me really get over that hump is understanding the power of a price increase. So there’s a reason why you tell your clients, you gotta go get a price increase. And one of those reasons is that a price increase is almost pure drop through to the bottom line. Now forget about a time that we’re in right now, where we’ve got inflation or, you know, there are supply chain issues. Whenever you get a price, increase the drop through on a price increase versus going out and getting a new piece of business is about 400% higher to your bottom line.

Jeb Blount (04:47): That’s a big number. So what I had to do as a salesperson and later on as a P and L owner, is to really understand what the purpose of a price increase is also it’s important. And this is also important for business owners who have salespeople working for them. And you gotta go tell your salespeople to go, to get a price increase is understanding how that new profitability helps the health of the company. And for, especially for, you know, for the group of people that pay most attention to you at duct tape marketing, you know, there’s nothing in the world that is more important than free cash flow, right? And a price increase is instant cash flow in instant revenue increase. And that is by the way, as long as you keep your customers, you may have to get the price increase and keep your customers and keep your orders. And essentially that’s what the book is all about. Yeah.

John Jantsch (05:34): So you mentioned the current climate we’re in, you know, it used to be like the annual price increase, but obviously people are dealing with weekly and monthly. I had a remodeling contractor give me a bid on something. And he said, this proposal is good for 24 hours because I don’t know what it, you know, the door’s gonna cost tomorrow. Right. So, so what’s changed in this current client about, you know, the approach. I mean, because some of it’s just like emergency, right?

Jeb Blount (05:58): Yeah. You know, there, when you start thinking about approaches or you’re thinking about is messaging, right? So there are, there’s essentially a couple of different ways that we deal with price increases. One is a price increase that we just give to our customers and then we defend it. So we tell our customers, you’re getting a price increase. And then we deal with the objections. We message it. We talk about it, but we give everybody the same price increase. And typically you do that when the risk of losing your customers or the orders is relatively small against the gain that you get on the price increase. And typically the price increase itself is gonna be small relative to what your customers are spending. The other is when you, the price increase may be negotiable or there is some risk. You may either present the price increase as if it’s non-negotiable, but you’d be willing to negotiate.

Jeb Blount (06:43): Or you go in and you ask your customers. So for example, if you’re a small business like mine and you’re dealing with big multinational fortune 500 companies where the risk of losing that company to my company is really high. Then I’ll typically go sit down with my customer and I’ll message it. Like I’ll build a business case for why I deserve the price increase. And that could be based on past value I’ve delivered. It could be on some future value that I’m going to deliver, but in a time like this often it’s an economic fairness message. In other words, what I’m doing is I’m laying out to them where my costs have gone up, where I’m getting impacted. So for example, in my world, because we fly all over the place, it’s travel, you know, the cost of travel has gone up exponentially over the past few months.

Jeb Blount (07:25): So we have to go to our customers and say, we’re raising the price on what we charge when we travel someplace. And this is why, and the good news is that because most people, this is humans. Okay. So most humans have an innate sense of fairness when you can articulately lay out the case, the economic fairness case for why this should give the pricing increas. In most cases, the probability is relatively high. They’re gonna say, yes, you just have to be able to make that case. And in a time like ours, where it’s, it is an emergency in some cases, and it is a moving target. What you really have to be prepared to do is to deliver that message. So you wanna sit back, practice that message. And by the way, deal with any objections you might get and have rebuttals for those objections. So

John Jantsch (08:10): One of the cases I make sometimes where we’re getting people to raise their prices to, to a level that might be fair is that they actually might be better off losing some of the clients that leave for that. I mean, you talked about the bottom line, right? If, you know, drop 20% to the bottom line, but you lose, you know, 3% of the customers doing it, right. You’re better off. And in some cases, not always, but in some cases, in my experiences, that’s a client that you probably didn’t have a great relationship with anyway, and that may be your fault, or it may just be that it wasn’t a good fit anyway.

Jeb Blount (08:42): Yeah. I use, uh, to analyze where, which customers I’d like to lose. I just use a, basically a four quadrant. I call it a fit matrix. And at the very top right hand quadrant is, it’s a, it’s easy to work with. Yeah. And high profit. Yeah. And right below, that would be easy to work with low profit. Yeah. On the left hand side, it is hard to work with high profit. And on the bottom left hand side, it is hard to work with low profit. Yeah. It’s the hard to work with low profits that I typically go after. And this is, you know, me as a small business, I had a fortune 100 company that we were working with. We had closed a deal. We celebrated it in about a year into it. We realized that we made a grave mistake. They were killing us.

Jeb Blount (09:23): They wanted so many of our resources. You know, they had 20 people for every one of my people and they would just had this endless just line of requests for us. And my whole team said, we gotta fire this customer, cuz we were really hard to work with. We weren’t making a lot of money. And so I didn’t wanna go burn the bridge because I just felt like it would be a bad thing just to go tell a big company like that when I’m a little tiny company, just go away. So I went in with a 300% higher price than I had previously given them when we signed the deal in the first place. And I expected them to throw me out the door. And when I gave it to them, the buyer simply the person that I was dealing with with the contract and procurement said, how can you justify this?

Jeb Blount (10:04): I, then I explained it. I said, you guys are really hard to work with. Were a small company. You asked for all these things. A lot of the things you ask for are off contract and we feel obligated to do it for you because you’re, you know, you’re the big gorilla and you know, your team needs things done right now. And the only way that I can keep serving you is I gotta hire more people in order to come in and do this. And the procurement person just, you know, they just looked down at the contract for a minute and looked at me and goes, you’re right. We are really hard to work with signed the contract. And then we were good again, like it felt, I mean, I felt like we didn’t resent them. They signed up for more, which was a good thing for us.

Jeb Blount (10:38): And I found that happens often that in a lot of cases, you’re undervaluing yourself. Yeah. That’s the first thing you and I talked about. But if, if you can, if you can put your customers in segments like that, it’s a lot easier when you look at it and you realize I’m not making any money at this, it doesn’t make a difference how much revenue you’re making. If you’re not dropping to the bottom line, you have no cash flow. You have no cash flow, you’re dead. So you can at least look at it and go, okay, that gives me the courage to go in and have a conversation with them cuz I’m not making any money. And oh, by the way, if a few of these went away, I could probably spend those resources right on the easy to work with high profit customers and make them even more profitable and sell more things to them.

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John Jantsch (12:02): So one of the things you, uh, mentioned already also was this idea of relationship building. And I think it’s like a lot of things you get that next sale or that price increase months before it actually happens. Right? Yes. And so, you know, what’s your advice to folks to say, look, it’s inevitable. You’re gonna have to go ask for this. How do you set the table?

Jeb Blount (12:23): Well, if you think about price increases in the suite of things that we sell, price increases are on the expansion side of the, of the equation. In other words, I already have the customer, I need to expand the relationship. So price increases should not be, as we think about this time that we’re in right now, something that we’re thinking about right now, price increases are something that we’ve gotta be thinking about forever because we’re always looking to expand those accounts. And when we’re in that boat, it’s in our best interest to make sure that we’re managing our accounts in the book. I just break down something really simple, but I just tell you the truth. And that is that about 70% of the time when you lose a customer, it’s because of neglect. Yeah. And that would be true is if you go in and you ask for a price increase or you present a price increase and your customer gets mad at you is probably because you weren’t taking care of them.

Jeb Blount (13:13): So the easiest, fastest way to get price increase is just manage your accounts. You just take care of them, do the things that you’re supposed to do as a business, delight your customers, deliver a great customer experience, make sure you’re constantly solving problems. And if you’ve ignored an account for a long time, and that happens in business and it happens with salespeople as well in their portfolios, if you’ve ignored it, don’t let the first conversation you have with that customer in six months, be about a price increase, put yourself together, a campaign, go in and set the stage, go solve some problems, do an account review, rebuild a relationship and then come back in with a price increase. But the biggest problem that we, you know, that we see in with price increases across the board is that because they’re unpleasant for both parties, the, the party that has to bring the price increase to the customer has a tendency to put it off.

Jeb Blount (14:03): Yeah. So they end up dropping a price increase in the customer’s lap, but don’t really give them any time to deal with the price increase. Yeah. And if you’re just, if you’re a business, you know, you’re and you buy things from other, from vendors, like most of us do, you can imagine that what, that the sort of, what that would put you in terms of a, you know, a bad spot or how it might back you into a corner. If one of your vendors came with you as came to you with a price increase at the last minute, and you didn’t have time to figure out how you were gonna absorb it or pass it on to your customers or deal with it. And that typically happens because we, we just don’t want to confront our customer with the truth.

John Jantsch (14:40): Yeah. It’s funny too, because nobody likes change. It’s really funny of any kind. I mean, I swear there have been times when I’ve tried to give somebody something for free and they were, you know, suspect. I hadn’t told him why I hadn’t said because. And I think that’s, you’ve been talking about this price increase. Like it’s just a unilateral kind of price sheet kind of thing. But as I listened to you, describe this. It’s almost like you can, if you have the right conversation, you can actually come to an agreement together on what’s the right approach. Can’t you?

Jeb Blount (15:09): Yeah. I mean, if you’ve got a great relationship with your customer and in, in the book, I give you eight different narratives, right? That can be woven together in ways that allow you to have that conversation with your customer. But if you’ve got a great relationship with your customer, and I think, you know, that most of us do what I found is that the thought of going in and having the conversation about the price increase is way worse than the actual conversation itself. and it’s a lot better. If you can go in and you can make your case, just build a good business case and sit down with your customer and work it out with them that in most cases, because human beings are inherently fair to each other, that you’ll be able to work something out without a lot of objections. And it’s also important.

Jeb Blount (15:53): I think that you start thinking about how do you set the stage? Because what you talk about is you don’t really like change. Nobody likes change. If you spring it on someone, you’re likely to get a really tur response or you may get pushback. If you start setting the stage forward, if you start talking about the marketplace and your price is going up and you know, I’ll even say to someone, you know, we’ve been raising our prices on our other customers right now, we’re holding the line with our existing customers, but there’s a pretty good chance that we’re gonna have to come to you with a price increase sometime in the near future. I didn’t actually put a price increase in their lap, but I began to get them accustomed to the fact that it’s gonna happen. Yeah. And they’re thinking about it. So, and that typically makes it a little bit easier for them to absorb the price increase in our conversation or notice, I guess probably a better way of saying that.

John Jantsch (16:41): All right. What about the sales rep that’s faced with the situation? We all know there are companies out there that, that do this where the real reason they’re raising the price is because they can. Right. And so now the sales rep is faced with that’s their only, I mean, they’re obviously not going to go in and say it. That’s why we’re raising the price, but that’s their only real talking point. So, you know, how do you suggest somebody handle that when they really don’t have a great rationale?

Jeb Blount (17:04): Well, first of all, you wanna make sure that you are being professional and you’re being nice and that you don’t walk in already defensive. I’ve had that happen where I’ve had a salesperson come with a price increase and they’re te and they’re, you know, they’re cold because of their own emotions rather than mine. Yeah. And you don’t wanna do that at all. And certainly right now, if you’re in a situation where you can raise your prices and drop more money to the bottom line, you absolutely should. I mean, as a business, that’s your job to make profit. And by the way, there’s a difference in, you know, doing that. And then, you know, shoving something down someone’s throat and doing, you know, doing something that, that lacks in the integrity. I’m just talking about. Yeah. The regular course of doing business, you’re in a situation where you can drop more profit in and continue to serve your customers.

Jeb Blount (17:47): You should do that. So you start off with again let’s so let’s start setting the stage. Let’s build a campaign, let’s start, preframing the price increase early. Let’s be professional. Let’s be super nice. And then go back to our narratives. One of the narratives that you want to use in a situation like that is past value. Here are all of the things great that we have done for you. Yes. You’re gonna be paying more for the same thing you were getting before, but look at all the things that we have contributed to you and your business over the years. And, and when you use that approach, most people will accept the price, increase most business people, especially people that you know, that are in the B2B world, right? They get it, they understand what’s happening. They don’t like it. And they’re not gonna be, you know, jumping up and down and, you know, bringing in a bras band to welcome your price increase in, but they understand and they get it. The key is the way that you approach it, relaxed, assertive, professional confidence. It wins the day. Every single time

John Jantsch (18:48): You have a framework and I’ll just kind of tease it and you can talk about as much as you want, but obviously it’s a big part of the book and that’s, so there is actually a system, you know, for going out into, and you actually call it deal, you know, an acronym for that, that has four parts. So I’ll let you just kind of take that as far as you want it to.

Jeb Blount (19:05): Yeah. The deal framework is simply a framework for negotiating a price increase. So in, in some cases, especially with your higher risk customers, and there’s also a risk profile matrix inside the book that allows you to take your accounts and drop ’em into that risk profile, to make a decision about how you want to approach them with the price increase. But the deal framework is simply the process of if you begin negotiating and they, you typically sounds like this, John, they’ll say something like, um, Jeb, like, like I totally get that. You gotta give a price increase, but we’re, we can’t pay this much. We haven’t, we don’t, we’re not budgeted for that. Okay. Well, that’s great. So you’ve accepted the price increase because you said I get it, but I’m not paying that much. Now I gotta work out something with you. So I wanna get onto the table what their issues are.

Jeb Blount (19:52): So I, I don’t wanna negotiate before I do that, then I want to give them, you know, my point of view. So, so I want to, I wanna explain the price increase and the reason why I’m doing the price increase and the business case behind it, even though if I’ve already explained it before typically a negotiation, people get amnesia. So I wanna come back and explain it again. And then what I wanna do from there is I want to get to a place where we can both agree. And for me, the one thing that I wanna protect during a price increase negotiation is my points. So let’s say I’m doing a 10% price increase. If I give up five points, that’s 50% of my price increase. So the way that I do that is I try to find things like funny money. And what funny money is something that I have that I can give my customer’s valuable to them, but really doesn’t mean that I’m giving up anything on my end.

Jeb Blount (20:42): So for example, let’s just say that I’m a business and I offer training for my customers and I’m giving a price increase to a big customer and the training typically they have to pay for, and they don’t, they haven’t paid for it. I might say, I’ll give you the training in exchange for the price increase. Well, the training’s probably online. It’s not costing me a whole lot of money to, to run it. And I didn’t give up my price increase points. Cause you gotta remember those price increase points. Those are, you know, those are gonna be adding up. Those are they’re they’re, they’re, they’re, you know, they accumulate over time. So giving up five points over months and months of time can be a really big number for you. So I, compoundings the number of the word that I’m looking for, but they compound over time.

Jeb Blount (21:22): So, so you want protect your points at all costs. And so that’s typically what I’m doing. So, so deal is just discussing the issue. It’s explaining my, you know, my situation or my business case. It’s aligning on an agreement typically a little bit of give and take. I want to give away things that don’t cost me anything while I’m protecting my points. And the L just stands for locking it down with a handshake or an agreement or a signed contract or money in the bank or something that, that symbolizes the fact that we have come to an agreement.

John Jantsch (21:55): So I know you work with a lot of sales managers who are tasked with coaching, a group of people around doing this. And so you do finish off the book with a nice section for those folks as well. And I, so if you’re a salesperson sales manager, there’s gonna be something in, in you in, in this book for everyone, J Jeb, you wanna tell people where they can find out more about your work at sales gravy, and then obviously all the books and, uh,

Jeb Blount (22:18): Yeah, absolutely. Well, the best place to find out about books is go to Amazon Barnes and noble, wherever you buy books. And you’ll be able to find selling the price increase there and my other books. And then if you wanna learn more about me, you can go to my website, jlu.com. My last name is spelled B L O U NT, or to sales, gravy.com, where you can check out all of our resources that we have for sales and sales people and anyone who is customer facing.

John Jantsch (22:44): Awesome. Well, Jeb’s great to appreciate you taking some time to step stop by the duct tape marketing podcast. And hopefully we’ll run into you one of these days soon out there on the road.

Jeb Blount (22:53): Yes, sir. Thank you.

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