How To Stair-Step Your Way To Big Profits With The “Self-Funding Promotion” (SFP)
By Eric Ruth
What’s the single biggest obstacle to your business growth?
Is it finding prospects? No! The vast majority of people out there need to improve their health and fitness.
Is it awareness? No! Not a day goes by that some major media doesn’t cover the dangers of being in poor health and out of shape.
The biggest obstacle is the inability of your prospects to distinguish between PRICE and VALUE!
Why should prospects pay you $50 for one session, when they can pay that to a gym for an entire month’s access?
Why should prospects commit to a package of your services that only last 16 weeks when, for the same amount of money, they can buy a nice treadmill – that they can have forever?
You and I know that the prospect is going to join the gym and rarely attend. We know that they’ll use the tread for a couple weeks then it just collects dust.
Here’s a news flash – what you and I know DOESN’T MATTER ONE BIT!
All that matters when it comes to marketing and selling – ALL THAT MATTERS – is what the prospect knows or doesn’t know.
That’s what “thinking accurately” is all about. If you want to be an effective marketer and seller of your services – you MUST be able to put yourself in your prospect’s shoes and think as they think. You must be able to EMPATHIZE.
You see, in reference to the example about joining a gym/buying home fitness equipment vs. hiring you… in the prospect’s mind, it is a much more rational and economically sound decision to join the gym or buy the home fitness equipment.
Why?
Lack of UNDERSTANDING.
Neophytes don’t REALIZE that, in the long run, most will spend much more time and money in their quest for fitness and health by purchasing a tread or joining a gym.
A strikingly large majority of people in pursuit of fitness simply quit when the going (inevitably) gets tough.
That’s why the health and fitness industry is growing, while our population essentially remains the same.
The market isn’t getting bigger (well, maybe a touch due to awareness), it’s just getting hungrier. Health and fitness marketers are capitalizing on the fact that they know people are always looking for “what’s new” – they’re always looking for a “panacea” – they’re always looking for a “magic bullet” that will (finally) be the “answer.”
What people don’t realize, or don’t want to face up to, is that the only shortcut to achieving a healthy and fit lifestyle is a healthy diet and a healthy dose of exercise. There is no magic wiz bang piece of equipment, pill, potion or powder that will transform them.
That’s why YOU are the best solution to their problems. Yet YOU are not getting the business you deserve, based on the results you can deliver. Why is that?
It’s because the majority of the market doesn’t understand and appreciate the VALUE of what personal fitness trainers do. They don’t equate a $1200 investment in your services to obtaining the results they want. It’s too easy to justify NOT spending the money to hire you because they don’t fully understand that you are the ANSWER they’re looking for.
That’s why the EDUCATION process is so critically important to your business.
You are asking a prospect to make a considerable financial commitment to you (considerable in comparison to the other options available to him or her).
So you must be prepared to invest in the education process.
And that is exactly why I teach the type of lead generation system, incorporating free reports and relationship building through education, that I do.
Today I want to talk to you about an application of that system which can be very, very powerful.
Stair-Stepping Your Way To Big Profits With The “Self-Funding Promotion.”
Now listen closely, because I’m not making this stuff up. This is a tested and proven marketing system that consistently generates clients.
When you have developed a lead from any number of the advertising methods I teach, you then begin making offers to that lead – that prospect.
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Note: This system does not apply to referrals or anyone coming to you who already knows you, knows of you and trusts you. This system is for “cold” prospects.
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Now, there are many different offers you can make. And there are no hard and fast rules about a particular order in which you should make your offers. You have to test.
But I can tell you this for certain.
It’s a whole heck of a lot easier to make a $27, $47 or $67 FIRST sale than it is to make a $247, $497 or $997 FIRST sale.
Why?
TRUST!
A cold prospect does not know you or know of you. They don’t trust you. Establishing trust can take time. So a cold prospect is much more likely to “risk” a purchase of $47 than he or she is to risk a $497 purchase.
For this reason, it behooves you to make a low-cost (loss leader) type offer to your cold prospects.
Now that offer could be anything you choose. You could offer two free training sessions, you could offer a fundamentals of exercise “package” for $47, or any number of other things.
But it is my belief that you are best served offering INFORMATION PRODUCTS.
Why?
They have *high perceived value* vs. low production cost.
You *control* the product – you don’t have to buy it from someone else and then resell it with a low margin.
They *position* you as an expert.
They *educate.*
They *sell* your services.
Think about it for a second. If you have a self-published book or a video or an audio cassette program, these things cost about $2 - $10 each for you to duplicate. But you can sell them for $19 - $39. Okay, that’s not going to make you rich, but the revenue generated does something very, very important –
-- it SELF FUNDS your marketing.
If you run an ad costing you $200 that generates 30 leads, 10 of whom buy your $29 book, you’ve grossed $290. Let’s look at the numbers more closely.
Ad -- $200
Voicemail -- $15
Sales letter/postage to 30 leads @ $1.50 each -- $45
Self published book @ $8 each X 10 -- $80
Total Cost: $340
Gross sales: $290
Total marketing expenses: $50
What do you now have?
You have 30 leads plus 10 customers – all for an out of pocket expense of $50!
If you continue to work the 20 leads, you will probably be able to close another 2 – 5 of them (10 – 25%). But even if they all suck and don’t buy anything from you, you still have 10 NEW CUSTOMERS!
That’s why this is called a “self-funding promotion.” You were able to obtain 10 new customers at almost break-even cost. But wait – it gets better.
Remember: buyers are buyers are buyers.
If they’ve bought your book and you’ve delivered value, there is a very, very good chance they will buy something else from you.
HERE’S A BIG SECRET:
What’s the purpose of your book? Think about this for a second. Test yourself. Are you learning from me? I hope so. Put on your marketing hat and ask yourself, “what is the PURPOSE of my book?” Okay, you know the answer, right?
Your book is essentially an expanded, in-depth special report. The purpose of your book is to sell your services as a Fitness Professional.
Remember what I said earlier about EDUCATION. Your book (or video or audio program) is a marketing tool that educates your customer, tangibly demonstrates your expertise and SELLS, SELLS, SELLS.
Some of you may recognize the name Wade Cook. He was huge about 5 years ago. He was an investment guru. In the course of about 4 years, he wrote 3 or 4 books. His books were basically sales pitches for his bootcamps. The book cost $19, the bootcamp cost $4500!
Did this strategy work? Well, Mr. Cook is worth a cool $80 million dollars right now. Don’t get me wrong (in my opinion, Mr. Cook was too salesy in his books) you must deliver value and expertise in your book, but you also must PITCH your services.
Bill Phillips “Body For Life” is another great example of this strategy. His book delivers great information, but it is primarily a sales tool for his supplements and fitness contests.
Of course, the big issue is this, where do you find the time to write a book? Well, it’s not nearly as difficult as you may think. Are you producing a newsletter? Are you writing articles for your local newspaper? I really hope so. If you just commit to writing one good article a week, in ten to fifteen weeks, you have a book! It’s that easy. And doing an audio program is even easier. A video requires more time, money and effort, cause it’s got to have reasonably high production value.
Stair-stepping is the act of selling a low cost, front-end loss-leader product or service that probably generates no profit whatsoever (you may even take a small hit like in the example above). But what it does for you is breaks down the trust barrier.
The hardest thing to do in marketing is to get cold prospects to give you a chance – to make that first purchase. So you want to make it as easy and painless as possible. Once you’ve sold them something low cost on the front-end, you then can gradually move them up the “stairs” (or down the funnel – whichever analogy you prefer) by selling them higher and higher cost products and services.
And that low-cost front-end product or service can also “self-fund” your marketing.
If you can break even on your marketing while still acquiring customers/clients, you are doing great! If you invest $500 per month on marketing and that generates 20 new front-end customers who’ve purchased your low-cost product/service, returning about $500 to you, then you are breaking even WHILE ADDING CUSTOMERS!
Then you gradually stair-step those customers up the purchasing stairway to your high-end, high-profit services. This is how you overcome the PRICE issue. While simultaneously EDUCATING your prospects and building TRUST!
By the way, I had a big volleyball match the other night. We were scheduled to play a monster team. On the way to the game I was really nervous. I always get pregame jitters, but this time it was a little much. I tried what I usually do before games, visualization, and it just wasn’t calming me down. Then it hit me how friggin lucky I am to live in the greatest country in the world, to have people who love me and people I love, to be doing work that I’m passionate about, to be healthy and athletic, to play on a great team with guys who are my good friends, and just basically to be alive on this glorious day that God has given us. Man, that snapped me right out of my little nervous nelly syndrome and I played great. We won two out of three and had a blast! Life’s too short to allow the silly nonsense to distract you from what’s most important – LIVING FULLY AND RICHLY. Seize the day, my friend!
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