#and jack watching whit's ball almost go in and saying 'if that goes in my seven iron's going over my knee' which sent me

[thatsnotbuddies]

sandbagger 19 but just the jack and hanny bits

#supercut for me and wonderful mutual atreebreathing and all other lovers of the jeichel hanny dynamic #take a shot every time jack says there's a lot of golf left he's got words of affirmation for every occasion I'm obsessed #they are everything to me like hanny is jack's longtime guy if anyone knows how to deal with jack's moods it's him #soo reminiscent of that 2015 vid of them playing chel jack being so chatty and hanny by his side 'through thick and thin hanny we got this' #i need to stop i'm gonna go cuhrazy #jack eichel #noah hanifin #not seen here: the flirty energy between hanny and biz #and jack watching whit's ball almost go in and saying 'if that goes in my seven iron's going over my knee' which sent me #jack laughing gives me life hehehehe reservoir dogs added ten years to my life #jack/hanny

[kee-writestrashh]

Guns for Hire

Ramsay Bolton x Reader

ao3

Summary:  You are the wife to the Heir of the Red Kings, Ramsay Bolton. living the undercover life of a mob wife has its perks, and you love your husband. But you find out something that seems to unfold a series of unwanted events…

Chapter 29: Leavin’ on a Jet Plane

"Do you have any idea how nice it is to wear fucking sweats and a tee and just lay the fuck in bed?" You yawned, stretching and curling up in a ball under the covers.

Kira simply scratched her ear, her collar and tags clinking noisily.

The morning had been slow, and very comfortable. Outside of bathroom breaks you hadn't been out of bed since Ramsay had left for work at seven.

Your phone vibrated from somewhere in the tangle of blankets and sheet.

You dug around until you found your phone under Ramsay's pillow.

[Rams: what are you doing?]

[you: laying in bed. you?]

[Rams: thinking about fucking you. send nudes.]

Your face warmed as you reread the message.

[You: I suppose I can do that. I need to get around anyways....]

You slid out of bed, stretching again, and stepping into the closet and pulling your most casual clothes free of their hooks.

Ripped jeans, grey tank, and a soft flannel. Ramsay liked to call the look "boot scootin boogie". Or when you paired it with your leather jacket he called it "Winchester Whore".

After sending a handful of pictures and going through your shower and make up routine it was almost time for you to meet with Whit and Jared.

You had given them the address to a hole in the wall BBQ joint in a less desirable part of town. But you figured it wouldn't be overwhelming or make you too noticeable. You knew how to blend in, comfortably.

You sat, waiting at a stoplight when you saw something that made your pulse quicken.

You immediately made a blind grab for your phone and dialing your husband.

'Yes, baby girl?' He said, almost bored like.

"Baby, I'm on my way to meet Whit and Jared, right? And I'm sitting here at the stoplight. I look over and two guys catch my eye. They're exchanging hushed whispers and firm handshake, kay? Then I look closely and it's Robb Stark and your father!" you said, the words tumbling over one another so quickly it all almost came out on one breath.

Ramsay said nothing, but you could hear his pen click furiously.

"Baby?"

'Yeah, yeah. What are you driving?'

"The 'Stang today." You said, glancing in the side view mirror. Both men were gone.

'Ping me your address and I will be there as soon as I can. Do not engage in anything without me. Do you understand?'

"Um, yes sir?" You said, unsure what he meant. Roose Bolton's peculiar behavior recently was too much for you to want to snoop into. You were already walking on egg shells, and apparently your second strike.

Ramsay hung up without another word and continued your way to lunch. You parked next to a jacked up truck, that was dirty and caked in mud. It didn't scream 'city boy wanna be country'. So it could only be Jared's truck.

You sent Ramsay the address and stepped out of the car.

Whit and Jared were leaning against restaurant wall, smoking and both smiled warmly when you approached. You couldn't help but grin at Jared in his damn cowboy hat, and Whit in her flashy square toed boots.

"Truck could do with a hose down." You chuckled, hugging them both.

"What's the point? With all the snow melting and refreezing, no amount of washing will make a difference until summer." Jared shrugged, flicking his cigarette away from him and opening the door for you and Whit, taking his hat off.

Walking in was like stepping through a portal to home. Smoke, beer, the smell of frying foods... it was... heaven.

"Sit anywhere and your waiter will be with you shortly." A woman said, clearing the table closest to you.

You chose a booth by the window, where you could keep an eye on the door and everything else around you.

A young man set menus down in front of you and set down the cutlery.

"Drinks?" He said when he had finished.

"Sweet teas all around." You said, immersed in the menu.

"You guys. They have fried catfish! And cornbread!" You almost squealed, looking up from the menu.

Whit raised her brows at you, "You don't eat cornbread anymore?"

You shrugged, "I just haven't bought the shit to make it. Burgers, tacos, and pizza is about as far as Rams goes in clogged arteries."

"City folks. They're a strange lot." Jared said, nodding wisely.

You snorted, rolling your eyes. "So, how are you guys? I mean... y'all have been together since junior year, work as a team, have a beautiful little girl..."

Whit laughed, "Oh ya know. Cattle prods work real well. We are just the same as when you left. Just older now. It's you who has the most change. Tell me about this child your mother won't quit bragging about."

You shrugged, "not much to say yet. Just turned fourteen weeks. We find out the gender on February twenty-first. Which is part of the reason I asked y'all here. We have a lot of work to do before then and quickly running out if time."

Both your friends stiffened slightly, showing you had their full attention and confidence.

"What's up?" Jared asked, leaning forward slightly.

You made to open your mouth when Whit shook her head, looking past you as the waiter came back with your drinks and to take your orders.

You waited a few moments after he left before finally speaking.

"My husband's life is in danger and it all hangs on to what the little one inside of me is. I have six weeks to set up a safe plan and find a way to keep my husband alive." You said quietly.

Whit chewed her lip and Jared watched you closely.

"We will do what we can. He's your family, which makes him just as much ours. Just say the word and we will make it happen." Jared said with a stiff nod.

A surge of deep gratitude flooded you as you looked at the two people in front of you. You knew the words were sincere and they would do anything they could for you.

You gave a sniff and smiled, "but those details will be worked out at a later time. I came here to enjoy lunch with my two best friends. There is plenty of time later to talk about that. But, first order of business. I need y'all to find someone to help dad keep up the farm. He's having surgery soon. Putting in a pacemaker. And he won't be able to get around for awhile. Said person will be paid well. I've made sure of that."

"Too easy. Sure there are a couple of Ag kids who'd love to help." Whit said. "Take it the old man is okay?"

"More or less. Pissed he's getting old. And y'all know mom. Fussing over him like a newborn calf." You said, sipping your drink.

"How she keeps up with him I will never know." Whit laughed.

Her words made you realize just how much like your mother you were.

Dad had always been wild and in trouble one way or another. No, not with the law, but usually physically injured. Smashed his hand working on a tractor. Wrapped up in fencing. Kicked by a horse, more times than you could even count anymore. He was a big book of cataloged accidents.

And then there was Mom. Patient and headstrong, and so very quick tempered. She kept your father together and alive, more often than not. She was firm, and yet the most loving person you had ever known. She was the true foundation of your crazy family. And she made it look so easy. How she managed to pull off Thanksgiving dinner and get your father to the ER after a hunting accident when you were 13, you never knew.

Maybe you took a bit more after your father's recklessness, but you had your mother's spine, and quick temper.

You grinned to yourself, "oh! Before I forget! Guess who's living here now?"

Jared and Whit both raised their brows, waiting for your answer.

"E! Little shit gets a PCS here, and doesn't tell anyone until he fucking shows up. Rams and I took him out last night. And I tell you what... He's not a boy anymore."

"And what did we do?" Ramsay spoke up, sliding into the booth beside you and running his eyes over the restaurant.

"Took the brother out lastnight." You said, with a smile, as he wrapped his arm around your shoulders.

"Had a blast. Damon made sure they got back safely. Apparently not as lightweight as we thought." Ramsay said, eyeing your food as it was set in front of you. "The fuck is that?"

You looked from food to husband and laughed.

"Cornbread, a hushpuppy, fries, and fried catfish."

Ramsay pulled a face of disgust.

"Try it. I promise there is nothing better than a good fried catfish basket." You urged, pulling a piece of fish from its fillet and holding it out to your husband.

"You do know I'm allergic to seafood, right?" He said, giving you a cold look.

You knitted your brows, "Are you really?"

"Keys." He said, taking the food from you.

"Huh?" You said watching him place the catfish in his mouth.

He reached over you, snatched up your keys and stood up.

"Ride home with them. Take the back way. I'll meet you at home."

He looked down at you, swiped more fish from your basket and walked off.

"Wait! You seriously aren't allergic to fish are you?!" You called.

He turned to you with his trademark smirk, "guess you'll just have to find out. Love you baby doll."

"I... I love you too." You said, watching him leave.

You looked at Whit and Jared.

"Nah. He's not." Jared said, with a chuckle, tearing into his plate of ribs.

It took so much longer to get home when you had to basically skirt the damn city.

"I have two dogs. Kira and Willow. They look mean, but I promise they are pussies." You said, walking up the stairs and hoping Ramsay was home since he had your keys.

You turned the knob. At least he was nice enough to remember to leave the door open for you as you walked inside.

"So you're a liar." You said, raising your brow.

Ramsay laughed, looking up from his laptop and giving you a wink.

"The best there is."

You rolled your eyes and sat on the couch, nodding at the sofa across from you. Whit and Jared both sat. Whit almost lost it when Kira and Willow came to be nosey.

"Oh my god! They are so pretty!" She said excitedly, sliding from the couch to her knees to rub all over them.

Whit was a dog fanatic. You were sure she would have 500 if Jared let her.

Ramsay crossed the room and disappeared down the hall. No one spoke until he came back and dropped a file folder on the coffee table.

"You two are now employed with a local coffee shop. You bring in coffee bean shipments via air." Ramsay said as Jared pulled the folder open and thumb through the papers.

"You looked us up? And my alias is Johnny Reb?" Jared asked, raising a brow.

"Just a minor background check. Your boots gave me the impression you listen to Johnny Horton, Honky Tonk Man." Ramsay shrugged, leaning back into his seat, resting his hand on your thigh and lighting a cigarette.

"You're a funny dude." Jared laughed, "and look, I get to travel with Percilla."

"So, what exactly are we doing? I mean, this is...?" Whit said, looking up from the dogs, at a loss for words.

"I told you, you're running coffee beans." Your husband shrugged.

Jared snorted, pulling his passport from the folder and examining it.

"But really. Need to be on the same page, babe." You spoke up.

"Okay, listen, and listen good. Because I'm only saying it once. In a few days you will get an address to an airstrip. Once a week you will fly to this strip and cargo will be loaded. Everything will already be packaged and sealed in the beans. If you don't lose your heads no one will ever be the wiser. After picking up the shipments you will deliver it to the designated area here in the city. After that you're free to go. The goods will be taken care of upon arrival. Simple enough."

"Right. Simple enough. And should something go wrong?" Whit asked, now taking her turn to look through the folder. "Oh! That reminds me..." she dug through her bag, pulling out a file folder a sliding it across the table, "Sharon got what you asked for."

"If something goes wrong, you will be taken care of. You are under my services, and I protect those that work for me. Nothing bad will happen as long as you don't let it happen." Ramsay shrugged.

You opened the folder, looking at all the vacant and foreclosed properties.

"Wow, so many places just left to rot." You murmured, looking up at Jared and Whit.

"Our town is dying. Cost of livin' is too high for the old folks, and young kids out of high school." Jared said giving you a sad smile.

"I'm buying it all." You declared, giving your husband a look and handing him the folder, "I'll let you do the buying and scheming. But we are buying it all. Build some businesses or something. Maybe build a safe house."

×××

"I'm starving." You whined, flipping through the pages of the outdated magazine.

"Shut up. You just ate like an hour ago." Ramsay tutted, staring at the ceiling.

"They need to hurry up. I have to pee." You groaned, fidgeting in your seat.

"What do I need to do to make you quit the insufferable bitching?" He hissed.

"Tell me what my surprise is." You said slyly.

Ramsay clucked in annoyance, "No. And if you don't quit asking I will do it all on my own. You're only getting the surprise because I love you."

"Fine." You huffed, pouting at him.

When your name was called you almost jumped up, ready to have all your vitals taken so they could give you the damn cup so you could finally empty your bladder that seemed to have shrunk to the size of a kitten's.

When the doctor entered you were slightly taken aback it wasn't Doctor Cat. But then you remembered... Ned Stark was her husband. And her eldest daughter was still missing. Poor woman. You really liked her.

"I'm Doctor Mordane. I'm filling in for Doctor Stark until she gets back." The old woman said with a sad smile.

"How is she?" You asked, sitting on the edge of the examination bed. Ramsay tutted from his chair. You gave him a dirty look.

"Pretty rough. But she's a strong woman. Anyways, looking at your file here I see you are almost fifteen weeks along. Weight is good. Everything else checks out good. Any complaints or concerns?"

You shook your head, "No ma'am. I seem to be adjusting just fine."

The woman smiled, "good good. Keep taking your vitamins. We will take a quick listen to the heartbeat and you're free to go."

Hearing the tiny heartbeat made your chest tight. Every single time. This time you didn't even bother to try and hold back the tear that escaped you.

"Surprise time?" You asked, smiling at your husband as he closed your door.

"Sort of." He smirked.

"What does that even mean?" You huffed, crossing your arms.

Ramsay said no more until he parked the car in the parking garage of the airport.

"What are we doing?" You asked, following in his wake.

Again he said nothing. You asked no more questions until you stood outside the doors of the airport.

There stood Damon. He exchanged two bags for Ramsay's keys.

"Before you say anything, I know. Scratch her you'll flay me." Damon chuckled, pocketing the keys. "Have fun. See you when you get back." He gave you both a nod and left.

Ramsay took your hand and led you inside. He exchanged a few words and some cash with a TSA man and both of you were boarding a plane a few short minutes later.

"Rams, where are we going?"

"Hush. Take a nap. It will be awhile." He said, stowing the two bags away and taking his seat beside you.

"If I blow you on this plane will you tell me?" You asked, flashing a mischievous grin.

"Nah. But you're gunna blow me anyways." He smirked.

"I will not." You said, crossing your arms and looking away from him.

"I will choke you out and make you sleep the whole damn ride if you don't quit, little pet." He said very quietly.

"What's wrong? Why are you so damn irritable today?" You said, giving him a soft look.

"I don't like flying." He replied shortly.

You suppressed a snort but were unable to to keep the words from falling from your mouth, "You're afraid!"

He took a deep breath and forced a smile, "No. I didn't say I'm afraid of flying. I said I didn't fucking like it."

"Mhm. Right. Completely different. What was I thinking?" You said with a sly grin.

"Do you have any idea how easy it would be to snap your fucking neck and make it look like you're sleeping until I get off this damn plane?" He hissed exasperatedly, struggling with himself to remain calm.

"Probably pretty easy. But I'd be rather boring company dead." You winked, resting your hand on his thigh and giving a tight squeeze.

He gave you a very long look, gave a smirk, and placed his hand in your inner thigh.

"Why are we like... economy class?" You asked, glancing around at the people filling the seats around you.

Ramsay shrugged, "Why not?"

You played with Ramsay's hand, absentmindedly, as the plane prepared for flight.

You watched Ramsay closely. If he really was afraid of flying, he hid it very well.

"Nonstop?" You asked, looking out the window at the tiny square patches of earth bellow you.

"Nonstop." He replied, glancing at you.

You pulled your phone out of your purse, "wanna play a game?"

"No."

You tutted, "Yes you do. You love games."

"I like games that I win. Games that cause other people to beg and die." He said simply, as if it settled the matter.

"Well I like games that let me get to really know you. So, I'm going to ask questions and you're going to answer."

He groaned, "not this again."

"Every time you don't answer or skip the question you will be punished." You said, squeezing his thigh again.

"Does it result with my dick in your mouth?" He whispered.

You shrugged, "maybe, if you're a good boy. Question one, if you could have a theme song, what would it be?"

He stared at the back of the chair in front of him, chewing his lip, "I don't know."

You dug your nails into his leg.

"Thriller or something." He hissed.

You released him and gave a laugh. "Thriller? Like MJ Thriller?"

"Yeah. Why not? It's catchy." He shrugged, taking his jacket off.

"I can't even take you seriously anymore." You giggled, leaning over to kiss him.

"Well that's a bad move on you, baby girl. I'm to be taken very seriously." He smirked against your lips as he took your face in his hands.

"Or maybe you just put on a mean face and deep down you're good as gold. Just have a rather pushy demon in there."

He snorted and pulled away from you, "going to perform an exorcism?"

"Mm, no. I think I'm in love with the devil."  You said airily, with a sigh.

"Show me how much you love me then." He countered with his wicked grin.

"I have a devil spawn growing inside of me, is that not love enough?" You winked, unfastening your seatbelt and pushing your body into his as you slid past him.

You gave him a mischievous grin, walking rather suggestively down the aisle.

Wow, plane bathrooms were tiny. This was not going to be comfortable. At least you weren't super pregnant fat yet.

You only had to wait a moment before Ramsay was climbing in the tiny room with you.

"I don't know if this will work." You whispered.

"Make it." He said, leaning back against the wall.

You glanced around, set the toilet seat down, and grabbed his hips, pulling him into you.

"Make it quick?" You asked, unbuckling his belt and sliding his button from its hole.

"That all depends on you, baby girl." He said helping you pushing his pants down.

"You know, you are the worst influence I have ever come to know." You said, resting your forehead against his warm stomach.

"Maybe you're the bad influence on me." He chuckled, gripping your hair tightly.

You licked your lips and took him in your mouth, letting his guide you.

You dug your nails into his legs as warm desire built inside of you. But there was no returning the favor in this damn bathroom.

You ran your tongue along him, tasting him as his grip in your hair tightened and he ran his other hand over your chest, grabbing at your skin.

His breathing became shallow as you lightly drug your teeth along him, swirling your tongue over his tip.

He made a small noise in the back of his throat, grabbing at you harder as he filled your mouth.

You slowly sucked him, feeling him throb against your tongue.

You swallowed and pulled away from him completely.

"Well that was quick." You laughed.

"Eh, thrill of getting a blow job at fifty thousand feet." He chuckled, fixing his pants and opening the door.

He grabbed your hand and led you back to your seat.

×××

You held Ramsay's hand tight as he pulled you along through the airport. You could see the sun a brilliant red as it sank lower over the horizon.

Ramsay stopped at a counter and hand a man behind it two passports. He glanced them over and then eyed you both.

"Welcome. What brings such a lovely couple to our beautiful country?" The man said in very rough, choppy English.

"Drugs." Ramsay replied with a small shrug and his most charming smile.

You gave a wide eyed side long look your husband and wanted to vanish as you felt your cheeks burn.

Did he seriously just fucking say that?!

The man cracked a grin and let out a loud laugh after a few tense moments, "You señor are very funny man. Enjoy your vacation."  He handed the passports back to Ramsay who slipped them in his back pocket and tugged you along again.

"I can't believe you!" You cried in a small strangled voice.

Ramsay stopped abruptly, placed a hand on your shoulder and turned you to the highly polished, darkening window.

"Look at us and tell me what you see?"

You Looked at your reflections and sighed, "I see a husband and wife on vacation."

"Exactly, baby girl. As far as anyone knows we are taking a late winter vacation to escape the cold. We're here to sip mojitos, soak up the sun, and eat avocados, or whatever." He said, gripping your hand tightly and pulling you along.

"Eat avocados." You snorted with a giggle as you stepped out of the airport.

The warm breeze melting you into a bliss. Warm evenings. God, how you missed the warm weather.

"Journey okay?" Oberyn Martell asked, sidling up to you and Ramsay.

You were shocked only a moment. It all made sense now. You were here so the deal with the Martell's could be finished and sealed.

"Long." Ramsay said, sounding rather weary as Oberyn lead the way to a limo.

Ramsay helped you climb in, took his seat beside you, and pulled you as close as possible as Oberyn situated himself.

"The girls are most excited to take you shopping, (y/n)." Oberyn smiled, offering Ramsay a drink, who eagerly accepted. "Your room has been accommodated and food prepared. We will get down to business tomorrow after you both have rested."

"Food sounds wonderful." You sighed, resting your head on Ramsay's shoulder and closing your eyes briefly.

Or you thought it to have been brief. Next thing you knew Ramsay nudging you to wake up.

You sat up and were taken aback by the beautiful white stone mansion and it's many elegant balconies overlooking the white sand beach and crystal clear ocean.

It was probably the most beautiful thing you had ever seen, apart from last trip you had taken with Ramsay to a warm cabin surrounded by large aspens and evergreens in the shadows of the harsh, unforgiving snow covered mountains.

Tyene rushed you as you climed out of the limo behind Ramsay.

You hugged her back tightly.

"I am so glad you both came!" She smiled, looping her arm around yours and leading you inside.

"This place is absolutely beautiful." You exclaimed, taking in everything from the marble floors to shimmering crystal chandeliers, and the elegant imported rugs.

Tyene smiled brightly, "my uncle likes to be extra."

"Well, at least he has good taste?" You laughed, climbing the spiral staircase.

Tyene stopped in front of a door and stepped aside so you could enter.

"One of the best views in the house. If you need anything, don't hesitate to ask. Rest easy, (y/n). Tomorrow I am taking you to town. You will love it!" Tyene said, leaving you alone in the lavish room.

So much better than any high end, five star hotel resort. You thought, taking everything in and realizing Ramsay wasn't with you.

You frowned slightly, but the table laden with food caught your very hungry attention. You sat at the table and pulled the nearest dish towards you. You had no idea what to call it, as it was sweet, and spicy, and salty, and definitely meat... but whatever it was it was damn good.

A warm, night breeze blew in from the open balcony door and the sound of the ocean made you drowsy.

Ramsay entered the room a shirt while later after you had already stripped you clothing and climbed into the soft sheets.

"You good?" You asked, peeking over the top of the blanket at him.

His face softened slightly as he turned his gaze to you, "of course."

You pushed back into the plush bed, falling asleep almost at once.

#guns for hire #gfh #Kee_writestrashh #chapter 29 #29/90 #ramsay bolton x reader #ramsay bolton/reader #ramsay bolton #modern ramsay bolton #ramsay bolton imagine #game of thrones fanfic #game of thrones fanfiction #modern au #modern game of thrones #got modern au #Modern Setting #mafia au #organized crime au #AO3 fanfic #ramsay is his own warning #guns #violence #gore #ramsay things

[seo90210]

Transcript of Unlocking the Power of 80/20

Transcript of Unlocking the Power of 80/20 written by John Jantsch read more at Duct Tape Marketing

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Transcript

John Jantsch: Hello and welcome to another episode of the Duct Tape Marketing Podcast. This is your host, John Jantsch, and my guest today is Perry Marshall. He’s an online marketing strategist, entrepreneur, and author of numerous books, including one we’re gonna talk about today, the 80-20 of sales and marketing. So, Perry, thanks for joining me.

Perry Marshall: John, it’s great to be here. It was great to be at your summit a couple of years ago where I met a lot of your people. The world just seems to be getting more and more eccentric, and there’s a lot for us to talk about today. Man, you’re either harnessing the eccentricity, or it’s pounding you on the back of the head with a two by four. And there’s not much in the middle, so very timely.

John Jantsch: Let’s get kind of a baseline. I mean, everybody’s heard the 80-20 thing. It’s almost become cliché how people apply it. But I don’t know that that many people, and this is your contention with the book, that many people get the leverage that it provides at a business level, do they?

Perry Marshall: No. First off, it’s not just a business rule of thumb. It’s a fact of nature. And, in fact, if I go to the beach with a bucket, and I pull out a bucket of sand, the sizes of the sand grains is gonna be 80-20. And how much water is in all the rivers is 80-20. The dirt on your carpet is 80-20, and the files in your hard drive. Okay? That’s the first thing. The second thing is that there’s an 80-20 inside every 80-20. When people really get this, it kind of flips them out. And so I can run a spreadsheet or a sales report of all my customers, and if I sort it from top to bottom, 20% of my customers are gonna generate 80% of the sales, but then if I chop off the bottom 80% that only produces 20%, whatever’s left, that top 20%, it’s still 80-20.

And I can do that again. And 4% of my customers are 64% of my business. And then I could do it again, and 1% of the customers are 50%. Well, this is true in almost any part of your business, and we’ll get into that. But then there’s a third thing. And this is probably a little bit new to most people, but the world is really becoming much more 95-5 where 5% of your efforts or your customers produce 95% of your results, and the other 95% only produces 5%. And this is especially true online. I’ve been watching this develop. People really need to understand this. The world is not … Cause and effect in the world operate fundamentally different than they did even 15 years ago. And I don’t think most people have gotten the memo. There’s a lot of examples of this out there.

John Jantsch: Let me stop you there, because I want to clarify something. And we’ll get, obviously, into examples, and I want to go back to the nature comment.

Perry Marshall: Yes.

John Jantsch: But it’s the simple kind of no-brainer lesson, then, to say, “Look, 95%” or if we want to use 80-20, still, to not scare too many people, is 80% of what you’re doing a waste of your time almost? I mean, especially when you get 95-5. It’s like 95% of my effort is on 5%? Quit doing that?

Perry Marshall: Well, yeah or almost, okay? You’ll always find that there’s a bunch of those things that somebody’s gotta do. It might not be you. It shouldn’t be you, but it’s gotta be somebody. But for example, 80 to 95% of all businesses fail or most entrepreneurs, we have all these little projects that we get into, and the project is a miniature little business, truth be told. Even if we didn’t go form an LLC or something. But actually anywhere from four-fifths to nine-tenths of those really don’t produce anything at the end of the day. And what’s happening in the world is that there’s more and more people kind of getting nowhere or just treading water or altogether losing, and then there’s this minority of people that are just absolutely slamming the ball out of the park, like it’s a triple. It’s a home run and then some. There’s less and less that’s in the middle. And so I think people today have to be more ruthless about how they spend their time than they’ve ever been before. There’s never been a time when busy work would get you less far than it does right now.

John Jantsch: And there’s probably never been more busy work.

Perry Marshall: Oh my gah. Yeah. Like, amazing amounts of busy work, and it doesn’t even look like busy work on the surface. You have to be really discerning. Lots of things, they just sound like good ideas, and a lot of them are based on, well, it’s really what was working in 2003, and it’s not really based on what’s going on right now. So I am issuing a wake up call.

John Jantsch: So let me go back to the nature comment about the grains of sand on the beach or all the things you cited from nature. I mean, is there some sort of principle that suggests why that’s the case?

Perry Marshall: Yes. Yes, and I’m not gonna get super theoretical. I could go into all kinds of stuff about chaos theory. This is really what it’s based on. But, John, I just want you to imagine that we put a table in the middle of your living room, and we went to some machine shop, and we machined the top of that table to be absolutely flat to within 100,000th of an inch, and it was a mirror finish. But then I want you to imagine that there’s a leak in your roof, and now we’re gonna drip water on that table, and the water is gonna drip into the middle of the table. So here’s a question of, “If I have the table perfectly level, and it’s perfectly flat, does that mean that the water is going to evenly spread out on the table, and then drip off the edge of the table in a smooth-flowing stream?

John Jantsch: My guess is it would probably gather as much energy to spread itself out in a very small section of where it landed.

Perry Marshall: Well, right. Right. And what would happen is no matter how flat you try to make that table, it’s gonna be a little bit easier for the water to go in one direction than the other ones, and then it starts going. And once it starts going, well, the erosion will wear, and then a million years later, there’s gonna be this big giant groove in the middle of your table that started out as flat. There’s nothing you could do to make the water flow equally. And here’s the thing is everything in life and nature is like that. So how water erodes or, for example, you’ve 10 14-year-old kids yesterday tried Jack Daniels for the first time. And maybe they all sort of liked it. But one of them liked it a little more than the rest of them, and so 30 years from now the rest of them all take a drink a week or two drinks a week and one of them has five drinks before breakfast, and he’s an alcoholic.

Okay? So your customers are like that. And my customers are like that. Everything is unequal. And the thing is is education conditions treat everything like it’s equal, treat everybody like they’re equal. The teachers try to make all the kids equal. Well, I just want everybody to get A’s and B’s. It’s like, “Well, they’re not going to.” And so entrepreneurs harness the eccentricities where a lot of more ivory tower people, they kind of try to pretend they’re not there. And so you have to just completely reverse the normal way that you think.

John Jantsch: Okay. So for that person out there that’s thinking, “Where in the world is this going and why is this gonna apply to my business?” Let’s bring it back to something very practical inside a business. How could somebody start spotting that 95% opportunity?

Perry Marshall: Let me tell you a story, and maybe a couple of your people have heard this one before, but this is my favorite 80-20 story. I have a friend named John Paul [inaudible 00:10:15] who dropped out of high school when he was 17, and he hitchhiked from Denver to Las Vegas with a couple of gambling books under his arm, and he’s like, “I’m gonna become a professional gambler.” He starts going to casinos and playing poker every day and living by his whits at age 17. And after a few weeks of this he was like, “Dang. This is harder than I thought.” He bumps into this guy who runs a gambling ring named Rob, and he starts talking to him. And he says, “Well, could you teach me how to do this?” And Rob says, “For a percentage of your winnings I could teach you how to do this.” And so they shake on it.

And after they do that, “Hey, jump in the jeep, John. We’re going for a ride.” So they get in the car, and they’re going down the highway, and John says, “Okay. So how do I win more poker games?” And Rob goes, “You have to play people who are going to lose. And those people are called marks, and you need to find the marks in the room, and you need to play poker with them, and you don’t play poker with anybody else.” And he says, “Well, how do I find the marks?” And he says, “Here. I’ll show you.” And he pulls into a parking lot of a strip club, and they go in there. And there’s women and there’s rock and roll, and there’s people drinking and all this commotion and noise in there.

And he sits down at the table, and Rob pulls a sawed off shotgun out of his jacket. And he opens the chamber, and under the table, then he snaps it shut and it goes “chitch.” And all these guys look around. And John sees them. And the owner come over, and he says, “Hey, what’s going on over here?” And Rob goes, “Hey, we’re just fine. There’s no problem here. We’re just teaching the lad a lesson, not gonna cause any trouble. Don’t worry about us.” And then Rob turns to John and he says, “John, did you see those guys who turned around when I made that noise?” And he’s like, “Yeah. Those biker guys over there?” “Yeah, those guys.” And John goes, “Yeah.” And he says, “Don’t play poker with them. They’re not marks. Play poker with everybody else.”

Now, that was what I call racking the shotgun, and everything you do in marketing is rack the shotgun. In fact, I’ve trained my customers and clients to use that phrase all the time. Rack the shotgun is when you … You know who racks the shotgun all the time is Donald Trump, okay? Now, I’m not saying he does it for good reasons or whatever. I’m not making any statements about any of that, but he does it. Okay? And he gets a response. Now, what I have always found out is most people are instinctively afraid to rack the shotgun. They’re afraid to find out the truth. They’re afraid to go make that big noise out there and see, “Okay, who’s gonna turn their head and who’s gonna ignore?” Or, “Who’s gonna say no and who’s gonna say yes.”

I mean, it could even go all the way down to your teenager like, “Well, you know, I don’t want to … She came in at 2:30 in the morning last night, and I don’t really want to ruffle any feathers, and we seem to be getting” … Well, that’s like being afraid to rack the shotgun. Like, well, if you don’t know why your teenager came in at 2:30 in the morning, then whatever the reason is is probably not a good one, right? But you have to ask.

John Jantsch: Ignorance is bliss, right? Yeah.

Perry Marshall: I talked to a guy about … He owned a smoothie store, and he was doing all this Facebook and social media stuff, and I’d go, “Well, do you ever send them emails?” He goes, “No, I’m afraid of them unsubscribing.” Well, that’s racking the shotgun, man. I said, “Email is 10 times better than social media. You’re not emailing, because you’re afraid some people won’t like it? Send them an email. Let them unsubscribe. It’s fine.” In fact, if you’re unsubscribe rate is less than 5% or even 10, you’re probably not selling hard enough. So everything you do, everything you do in marketing is racking the shotgun.

John Jantsch: So what you’re, again, coming back to my original question on that, what you’re suggesting is that’s how you’re gonna find the leverage?

Perry Marshall: Yeah. With people, right, you’re gonna find that most people actually aren’t gonna respond to anything that you do. They’re never gonna buy, okay? And maybe it’s 80% aren’t gonna buy or maybe it’s 60% or maybe it’s 95% aren’t gonna buy. But there is a rack the shotgun just with buying. Now, the interesting part about 80-20 is that if you rack a shotgun, and you get, let’s call it $100 shotgun. It’s a $100 transaction, let’s say, and you get 100 people to respond. Well, if you quadruple the price, if you rack a $400 shotgun, 20% of those people will respond again. And if you rack a $1,600 shotgun, 20% of those people will respond again. If you rack a $6,400 shotgun, 20% of those people will respond again. And so you’ll find that even though you started with only 100 people, let’s say, who would spend $100, you might find one person who would spend $50,000. And you didn’t know it, and that person was already there. That person is already in your audience. And what I am seeing is that all of this is becoming more pronounced than it used to be.

John Jantsch: So it really, I mean, again, one of the sort of core principles was you build a business, you got customers. You need to be trying to sell them more. I mean, essentially you’re saying that, but maybe at a level people haven’t considered, that not just is there an opportunity to maybe sell more, but that there is a sort of almost mathematical equation that says what you should you sell them and how much it should cost and who’s gonna respond?

Perry Marshall: That’s right. There is a hunger in the marketplace that there’s a small percentage of people who they have an extreme itch that they would like to scratch. And it’s almost unscratchable. When it’s just your product line, there’s some other things I want to get into, but let’s just restrict it to your product line right now. So 80-20 says, “If I have a Starbucks, and a thousand a people a month are buying a $5 latte, one of those people will buy a $2,700 gleaming stainless steel espresso machine.” And it’s just about a law of physics. Now, I started to notice something really interesting when I started teaching Google AdWords. I wrote the world’s best selling books on Google and Facebook advertising, and all of a sudden when AdWords came into existence, all of these new businesses that might not have even been able to exist before suddenly popped up.

And it was this giant feeding frenzy and gold rush. And what I noticed was that if somebody could get to the top in AdWords, they could get the number one position, which gets the most traffic. And then if they could streamline all the stuff in their website, the shopping cart, the sales pages, the landing pages, the offer, the unique selling proposition, if they could dial all that in and test it to the hilt, they would get to a point where nobody could shove them out of the way. They’re number one, they might be number on TV, and they might not be number one on the radio, and they might not be number one on main street, but if they’re number one in Google AdWords, and if they got their sales machine dialed in, they’re almost unstoppable.

Now, here’s why this was. It was because number two, number three, number four, number five, they all have to test their way to success, and they have to experimentally find what works, but you’re already getting more traffic than they are, and you can already do more tests than they are. And so you’re previous success greases the skids for you to continue to be successful, because you’re the incumbent. Well, I’ve been watching very carefully, and what I’ve seen is that an incumbent in the brick and mortar world is 80-20, but an incumbent in the digital world is 95-5. So here’s an example of this. You could go ask your 10-year-old kid, “Can you name a dozen car manufacturers?” And any 10-year-old kid could think of a dozen, Ferrari and Toyota and Kia. They could come up with a list. But can anybody name 12 search engines or 12 auction sites or 12 bookstores where you can buy any book?

John Jantsch: Well, I don’t know about you, but I have the top 100 search engines that every business should be in sitting right here next to me. I’m being facetious, of course, but remember when people used to talk about that.

Perry Marshall: Right. Right. And they all got washed out. Well, that’s because the internet is frictionless. So making cars, that’s friction all the way. Whether you go to the Toyota dealership or the Ford dealership, you have to drive across town, right? Okay. And so that supports there being 12 different car manufacturers. But if it’s Bing versus Google, there’s literally no difference whether you type in B-I-N-G or G-O-O-G-L-E on your browser. The only thing that makes a difference is how much you enjoy the experience. If Google is 10% better, then pretty soon everybody’s gonna use Google, and the Google’s gonna become 1,000% better, because they have more data and more customers and more bells and whistles and more everything. And pretty soon Bing doesn’t really have a chance.

And, see, everything in online marketing is like this. Basically, you’re either number one or you’re nobody. And I don’t think most people have really gotten this that this has happened. You’re either number one or you’re nothing. So that old phrase being a category of one, oh, it’s dead serious no. In a 95-5 world you have to be the number one. Whatever you do, you have to be the only one or you are hamburger.

John Jantsch: I think you can see that at a very real level for the local plumber, for example. I mean, all the searches are being done on a mobile device, and Google is determining, “Here’s the three positions that they’re gonna show.” And certainly if you don’t show up in those three, and as you suggest maybe number one of those three, you really don’t exist, I think. And so the digital world is even cutting into the world of friction.

Perry Marshall: It is.

John Jantsch: We may see a day when there’s only one car sale search engine, and the manufacturers are really, I think, playing basically to be there.

Perry Marshall: So I’ll make a prediction right now is that 10 years from now self-driving cars will be extremely common, and half of the auto manufacturers will either be out of business or bought out by the winners.

John Jantsch: Yeah. Yeah, because to some extent the brand won’t matter anymore.

Perry Marshall: No. It won’t. So watch out. Now, if you know this, if you know this, you can make predictions about the future. In many cases if you project 10 years in the future, if you are already pretty much know who the winner is, then you can bet on the winner, and you’ll gain. If there’s somebody out there … I don’t know. I don’t know who it might be, but if somebody out there already pretty much knows who’s gonna control the self-driving car thing, then you buy stock in that company. In 10 years from now you’ll be happy about it, because there probably isn’t that much that anybody can do even right now to change it. To give you another idea, there’s Bitcoin and there’s Ethereum, and there’s all these other little cryptocurrencies. Bitcoin already won. All the rest of them, that’s like .net, .cc, .name, .whatever. It’s just like domain names. They’ll have their little day in the sun and people will think. Bitcoin’s already won. It’s the winner-take-all phenomenon is on steroids.

John Jantsch:  I’m trying to figure out which direction to take this, because there’s so many we can go, and we’re really already out of time. So let me ask you how somebody would … And I’m trying to, again, end it on a really practical note. How would somebody apply this to an existing business? I can see a lot of people thinking, “Okay. If I could figure out this thing and predict the future, and I’ll create a business around that.” But how could somebody apply this? I mean, is this something that you have to have an epiphany? Or is this something that you have to just go out and start testing things in a certain way?

Perry Marshall: So here’s what you can do, and this is extremely practical. Richard [inaudible 00:26:29] and I put together this website called StarPrinciple.com. It’s free, and you can go click a dozen radio buttons and score your business. Basically it tells you how likely it is that you can dominate the niche that you’re in right now. It’s kind of a truth serum of this winner-take-all thing. So the score goes from zero to 200 points, and anything over 100 points is a home run. Okay? Now, some businesses will get a 25, and some will get a 75, and some will get 150. If you’re 150, man, you’re good, and you should pour on the gas. Well, so here’s what you do. Most of our businesses are really three or four businesses or three or four product lines or three or four markets, and they’re all kind of one umbrella. Here’s what you need to do. This could save somebody years of heartache and frustration right here. Okay?

You go, “All right. Well, I have product A, B, C, D. I have market A, B, C, D.” You score each one individually, because in one of your markets you’re really the number six player. In one of your markets you’re the number one player. One market is shrinking, and one market is growing. And you score that. And you break it up, and you need to figure out which part of my business do I pour the gas on and which part do I really just kind of ignore or I let coast? Right? Just give it as little gas I can get away with while I build the others, because 20% of your business is gonna produce 80% of the growth in the future, and the rest of it’s just gonna waste your time.

I think a lot of us aren’t really honest with ourselves about where our business is actually at and what it can really produce, and you need to be the winner. There is probably some part of your market where if you’re like, “Well, this part of the market isn’t very well served right now. Nobody else is really truly paying attention to this aspect, and I could totally nail it. And if I really put my resources into it, I could emerge as the absolute dominant player within six or 12 months,” and that’s what you should do.

John Jantsch: Visiting with Perry Marshal. We’re talking about the 80-20 principle, which is now 95-5 online. Winner take all is the game that we’re playing. Perry, thanks so much for joining us. Where can people find probably the best place to plug in to your, kind of, vast universe?

Perry Marshall: You can go to http://ift.tt/1TMHaKs. And just start by reading 80-20 in sales and marketing and just know that it’s even more true now than it was in 2013 when I wrote it. And the race is on. The race is on. It’s winner take it all, and whatever it is that you do, you need to find the thing where you can be number one, and you can totally dominate and be a category of one, because all..

from FEED 9 MARKETING http://ift.tt/2iF42kB

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Transcript of Unlocking the Power of 80/20

Transcript of Unlocking the Power of 80/20

Transcript of Unlocking the Power of 80/20 written by John Jantsch read more at Duct Tape Marketing

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John Jantsch: Hello and welcome to another episode of the Duct Tape Marketing Podcast. This is your host, John Jantsch, and my guest today is Perry Marshall. He’s an online marketing strategist, entrepreneur, and author of numerous books, including one we’re gonna talk about today, the 80-20 of sales and marketing. So, Perry, thanks for joining me.

Perry Marshall: John, it’s great to be here. It was great to be at your summit a couple of years ago where I met a lot of your people. The world just seems to be getting more and more eccentric, and there’s a lot for us to talk about today. Man, you’re either harnessing the eccentricity, or it’s pounding you on the back of the head with a two by four. And there’s not much in the middle, so very timely.

John Jantsch: Let’s get kind of a baseline. I mean, everybody’s heard the 80-20 thing. It’s almost become cliché how people apply it. But I don’t know that that many people, and this is your contention with the book, that many people get the leverage that it provides at a business level, do they?

Perry Marshall: No. First off, it’s not just a business rule of thumb. It’s a fact of nature. And, in fact, if I go to the beach with a bucket, and I pull out a bucket of sand, the sizes of the sand grains is gonna be 80-20. And how much water is in all the rivers is 80-20. The dirt on your carpet is 80-20, and the files in your hard drive. Okay? That’s the first thing. The second thing is that there’s an 80-20 inside every 80-20. When people really get this, it kind of flips them out. And so I can run a spreadsheet or a sales report of all my customers, and if I sort it from top to bottom, 20% of my customers are gonna generate 80% of the sales, but then if I chop off the bottom 80% that only produces 20%, whatever’s left, that top 20%, it’s still 80-20.

And I can do that again. And 4% of my customers are 64% of my business. And then I could do it again, and 1% of the customers are 50%. Well, this is true in almost any part of your business, and we’ll get into that. But then there’s a third thing. And this is probably a little bit new to most people, but the world is really becoming much more 95-5 where 5% of your efforts or your customers produce 95% of your results, and the other 95% only produces 5%. And this is especially true online. I’ve been watching this develop. People really need to understand this. The world is not … Cause and effect in the world operate fundamentally different than they did even 15 years ago. And I don’t think most people have gotten the memo. There’s a lot of examples of this out there.

John Jantsch: Let me stop you there, because I want to clarify something. And we’ll get, obviously, into examples, and I want to go back to the nature comment.

Perry Marshall: Yes.

John Jantsch: But it’s the simple kind of no-brainer lesson, then, to say, “Look, 95%” or if we want to use 80-20, still, to not scare too many people, is 80% of what you’re doing a waste of your time almost? I mean, especially when you get 95-5. It’s like 95% of my effort is on 5%? Quit doing that?

Perry Marshall: Well, yeah or almost, okay? You’ll always find that there’s a bunch of those things that somebody’s gotta do. It might not be you. It shouldn’t be you, but it’s gotta be somebody. But for example, 80 to 95% of all businesses fail or most entrepreneurs, we have all these little projects that we get into, and the project is a miniature little business, truth be told. Even if we didn’t go form an LLC or something. But actually anywhere from four-fifths to nine-tenths of those really don’t produce anything at the end of the day. And what’s happening in the world is that there’s more and more people kind of getting nowhere or just treading water or altogether losing, and then there’s this minority of people that are just absolutely slamming the ball out of the park, like it’s a triple. It’s a home run and then some. There’s less and less that’s in the middle. And so I think people today have to be more ruthless about how they spend their time than they’ve ever been before. There’s never been a time when busy work would get you less far than it does right now.

John Jantsch: And there’s probably never been more busy work.

Perry Marshall: Oh my gah. Yeah. Like, amazing amounts of busy work, and it doesn’t even look like busy work on the surface. You have to be really discerning. Lots of things, they just sound like good ideas, and a lot of them are based on, well, it’s really what was working in 2003, and it’s not really based on what’s going on right now. So I am issuing a wake up call.

John Jantsch: So let me go back to the nature comment about the grains of sand on the beach or all the things you cited from nature. I mean, is there some sort of principle that suggests why that’s the case?

Perry Marshall: Yes. Yes, and I’m not gonna get super theoretical. I could go into all kinds of stuff about chaos theory. This is really what it’s based on. But, John, I just want you to imagine that we put a table in the middle of your living room, and we went to some machine shop, and we machined the top of that table to be absolutely flat to within 100,000th of an inch, and it was a mirror finish. But then I want you to imagine that there’s a leak in your roof, and now we’re gonna drip water on that table, and the water is gonna drip into the middle of the table. So here’s a question of, “If I have the table perfectly level, and it’s perfectly flat, does that mean that the water is going to evenly spread out on the table, and then drip off the edge of the table in a smooth-flowing stream?

John Jantsch: My guess is it would probably gather as much energy to spread itself out in a very small section of where it landed.

Perry Marshall: Well, right. Right. And what would happen is no matter how flat you try to make that table, it’s gonna be a little bit easier for the water to go in one direction than the other ones, and then it starts going. And once it starts going, well, the erosion will wear, and then a million years later, there’s gonna be this big giant groove in the middle of your table that started out as flat. There’s nothing you could do to make the water flow equally. And here’s the thing is everything in life and nature is like that. So how water erodes or, for example, you’ve 10 14-year-old kids yesterday tried Jack Daniels for the first time. And maybe they all sort of liked it. But one of them liked it a little more than the rest of them, and so 30 years from now the rest of them all take a drink a week or two drinks a week and one of them has five drinks before breakfast, and he’s an alcoholic.

Okay? So your customers are like that. And my customers are like that. Everything is unequal. And the thing is is education conditions treat everything like it’s equal, treat everybody like they’re equal. The teachers try to make all the kids equal. Well, I just want everybody to get A’s and B’s. It’s like, “Well, they’re not going to.” And so entrepreneurs harness the eccentricities where a lot of more ivory tower people, they kind of try to pretend they’re not there. And so you have to just completely reverse the normal way that you think.

John Jantsch: Okay. So for that person out there that’s thinking, “Where in the world is this going and why is this gonna apply to my business?” Let’s bring it back to something very practical inside a business. How could somebody start spotting that 95% opportunity?

Perry Marshall: Let me tell you a story, and maybe a couple of your people have heard this one before, but this is my favorite 80-20 story. I have a friend named John Paul [inaudible 00:10:15] who dropped out of high school when he was 17, and he hitchhiked from Denver to Las Vegas with a couple of gambling books under his arm, and he’s like, “I’m gonna become a professional gambler.” He starts going to casinos and playing poker every day and living by his whits at age 17. And after a few weeks of this he was like, “Dang. This is harder than I thought.” He bumps into this guy who runs a gambling ring named Rob, and he starts talking to him. And he says, “Well, could you teach me how to do this?” And Rob says, “For a percentage of your winnings I could teach you how to do this.” And so they shake on it.

And after they do that, “Hey, jump in the jeep, John. We’re going for a ride.” So they get in the car, and they’re going down the highway, and John says, “Okay. So how do I win more poker games?” And Rob goes, “You have to play people who are going to lose. And those people are called marks, and you need to find the marks in the room, and you need to play poker with them, and you don’t play poker with anybody else.” And he says, “Well, how do I find the marks?” And he says, “Here. I’ll show you.” And he pulls into a parking lot of a strip club, and they go in there. And there’s women and there’s rock and roll, and there’s people drinking and all this commotion and noise in there.

And he sits down at the table, and Rob pulls a sawed off shotgun out of his jacket. And he opens the chamber, and under the table, then he snaps it shut and it goes “chitch.” And all these guys look around. And John sees them. And the owner come over, and he says, “Hey, what’s going on over here?” And Rob goes, “Hey, we’re just fine. There’s no problem here. We’re just teaching the lad a lesson, not gonna cause any trouble. Don’t worry about us.” And then Rob turns to John and he says, “John, did you see those guys who turned around when I made that noise?” And he’s like, “Yeah. Those biker guys over there?” “Yeah, those guys.” And John goes, “Yeah.” And he says, “Don’t play poker with them. They’re not marks. Play poker with everybody else.”

Now, that was what I call racking the shotgun, and everything you do in marketing is rack the shotgun. In fact, I’ve trained my customers and clients to use that phrase all the time. Rack the shotgun is when you … You know who racks the shotgun all the time is Donald Trump, okay? Now, I’m not saying he does it for good reasons or whatever. I’m not making any statements about any of that, but he does it. Okay? And he gets a response. Now, what I have always found out is most people are instinctively afraid to rack the shotgun. They’re afraid to find out the truth. They’re afraid to go make that big noise out there and see, “Okay, who’s gonna turn their head and who’s gonna ignore?” Or, “Who’s gonna say no and who’s gonna say yes.”

I mean, it could even go all the way down to your teenager like, “Well, you know, I don’t want to … She came in at 2:30 in the morning last night, and I don’t really want to ruffle any feathers, and we seem to be getting” … Well, that’s like being afraid to rack the shotgun. Like, well, if you don’t know why your teenager came in at 2:30 in the morning, then whatever the reason is is probably not a good one, right? But you have to ask.

John Jantsch: Ignorance is bliss, right? Yeah.

Perry Marshall: I talked to a guy about … He owned a smoothie store, and he was doing all this Facebook and social media stuff, and I’d go, “Well, do you ever send them emails?” He goes, “No, I’m afraid of them unsubscribing.” Well, that’s racking the shotgun, man. I said, “Email is 10 times better than social media. You’re not emailing, because you’re afraid some people won’t like it? Send them an email. Let them unsubscribe. It’s fine.” In fact, if you’re unsubscribe rate is less than 5% or even 10, you’re probably not selling hard enough. So everything you do, everything you do in marketing is racking the shotgun.

John Jantsch: So what you’re, again, coming back to my original question on that, what you’re suggesting is that’s how you’re gonna find the leverage?

Perry Marshall: Yeah. With people, right, you’re gonna find that most people actually aren’t gonna respond to anything that you do. They’re never gonna buy, okay? And maybe it’s 80% aren’t gonna buy or maybe it’s 60% or maybe it’s 95% aren’t gonna buy. But there is a rack the shotgun just with buying. Now, the interesting part about 80-20 is that if you rack a shotgun, and you get, let’s call it $100 shotgun. It’s a $100 transaction, let’s say, and you get 100 people to respond. Well, if you quadruple the price, if you rack a $400 shotgun, 20% of those people will respond again. And if you rack a $1,600 shotgun, 20% of those people will respond again. If you rack a $6,400 shotgun, 20% of those people will respond again. And so you’ll find that even though you started with only 100 people, let’s say, who would spend $100, you might find one person who would spend $50,000. And you didn’t know it, and that person was already there. That person is already in your audience. And what I am seeing is that all of this is becoming more pronounced than it used to be.

John Jantsch: So it really, I mean, again, one of the sort of core principles was you build a business, you got customers. You need to be trying to sell them more. I mean, essentially you’re saying that, but maybe at a level people haven’t considered, that not just is there an opportunity to maybe sell more, but that there is a sort of almost mathematical equation that says what you should you sell them and how much it should cost and who’s gonna respond?

Perry Marshall: That’s right. There is a hunger in the marketplace that there’s a small percentage of people who they have an extreme itch that they would like to scratch. And it’s almost unscratchable. When it’s just your product line, there’s some other things I want to get into, but let’s just restrict it to your product line right now. So 80-20 says, “If I have a Starbucks, and a thousand a people a month are buying a $5 latte, one of those people will buy a $2,700 gleaming stainless steel espresso machine.” And it’s just about a law of physics. Now, I started to notice something really interesting when I started teaching Google AdWords. I wrote the world’s best selling books on Google and Facebook advertising, and all of a sudden when AdWords came into existence, all of these new businesses that might not have even been able to exist before suddenly popped up.

And it was this giant feeding frenzy and gold rush. And what I noticed was that if somebody could get to the top in AdWords, they could get the number one position, which gets the most traffic. And then if they could streamline all the stuff in their website, the shopping cart, the sales pages, the landing pages, the offer, the unique selling proposition, if they could dial all that in and test it to the hilt, they would get to a point where nobody could shove them out of the way. They’re number one, they might be number on TV, and they might not be number one on the radio, and they might not be number one on main street, but if they’re number one in Google AdWords, and if they got their sales machine dialed in, they’re almost unstoppable.

Now, here’s why this was. It was because number two, number three, number four, number five, they all have to test their way to success, and they have to experimentally find what works, but you’re already getting more traffic than they are, and you can already do more tests than they are. And so you’re previous success greases the skids for you to continue to be successful, because you’re the incumbent. Well, I’ve been watching very carefully, and what I’ve seen is that an incumbent in the brick and mortar world is 80-20, but an incumbent in the digital world is 95-5. So here’s an example of this. You could go ask your 10-year-old kid, “Can you name a dozen car manufacturers?” And any 10-year-old kid could think of a dozen, Ferrari and Toyota and Kia. They could come up with a list. But can anybody name 12 search engines or 12 auction sites or 12 bookstores where you can buy any book?

John Jantsch: Well, I don’t know about you, but I have the top 100 search engines that every business should be in sitting right here next to me. I’m being facetious, of course, but remember when people used to talk about that.

Perry Marshall: Right. Right. And they all got washed out. Well, that’s because the internet is frictionless. So making cars, that’s friction all the way. Whether you go to the Toyota dealership or the Ford dealership, you have to drive across town, right? Okay. And so that supports there being 12 different car manufacturers. But if it’s Bing versus Google, there’s literally no difference whether you type in B-I-N-G or G-O-O-G-L-E on your browser. The only thing that makes a difference is how much you enjoy the experience. If Google is 10% better, then pretty soon everybody’s gonna use Google, and the Google’s gonna become 1,000% better, because they have more data and more customers and more bells and whistles and more everything. And pretty soon Bing doesn’t really have a chance.

And, see, everything in online marketing is like this. Basically, you’re either number one or you’re nobody. And I don’t think most people have really gotten this that this has happened. You’re either number one or you’re nothing. So that old phrase being a category of one, oh, it’s dead serious no. In a 95-5 world you have to be the number one. Whatever you do, you have to be the only one or you are hamburger.

John Jantsch: I think you can see that at a very real level for the local plumber, for example. I mean, all the searches are being done on a mobile device, and Google is determining, “Here’s the three positions that they’re gonna show.” And certainly if you don’t show up in those three, and as you suggest maybe number one of those three, you really don’t exist, I think. And so the digital world is even cutting into the world of friction.

Perry Marshall: It is.

John Jantsch: We may see a day when there’s only one car sale search engine, and the manufacturers are really, I think, playing basically to be there.

Perry Marshall: So I’ll make a prediction right now is that 10 years from now self-driving cars will be extremely common, and half of the auto manufacturers will either be out of business or bought out by the winners.

John Jantsch: Yeah. Yeah, because to some extent the brand won’t matter anymore.

Perry Marshall: No. It won’t. So watch out. Now, if you know this, if you know this, you can make predictions about the future. In many cases if you project 10 years in the future, if you are already pretty much know who the winner is, then you can bet on the winner, and you’ll gain. If there’s somebody out there … I don’t know. I don’t know who it might be, but if somebody out there already pretty much knows who’s gonna control the self-driving car thing, then you buy stock in that company. In 10 years from now you’ll be happy about it, because there probably isn’t that much that anybody can do even right now to change it. To give you another idea, there’s Bitcoin and there’s Ethereum, and there’s all these other little cryptocurrencies. Bitcoin already won. All the rest of them, that’s like .net, .cc, .name, .whatever. It’s just like domain names. They’ll have their little day in the sun and people will think. Bitcoin’s already won. It’s the winner-take-all phenomenon is on steroids.

John Jantsch:  I’m trying to figure out which direction to take this, because there’s so many we can go, and we’re really already out of time. So let me ask you how somebody would … And I’m trying to, again, end it on a really practical note. How would somebody apply this to an existing business? I can see a lot of people thinking, “Okay. If I could figure out this thing and predict the future, and I’ll create a business around that.” But how could somebody apply this? I mean, is this something that you have to have an epiphany? Or is this something that you have to just go out and start testing things in a certain way?

Perry Marshall: So here’s what you can do, and this is extremely practical. Richard [inaudible 00:26:29] and I put together this website called StarPrinciple.com. It’s free, and you can go click a dozen radio buttons and score your business. Basically it tells you how likely it is that you can dominate the niche that you’re in right now. It’s kind of a truth serum of this winner-take-all thing. So the score goes from zero to 200 points, and anything over 100 points is a home run. Okay? Now, some businesses will get a 25, and some will get a 75, and some will get 150. If you’re 150, man, you’re good, and you should pour on the gas. Well, so here’s what you do. Most of our businesses are really three or four businesses or three or four product lines or three or four markets, and they’re all kind of one umbrella. Here’s what you need to do. This could save somebody years of heartache and frustration right here. Okay?

You go, “All right. Well, I have product A, B, C, D. I have market A, B, C, D.” You score each one individually, because in one of your markets you’re really the number six player. In one of your markets you’re the number one player. One market is shrinking, and one market is growing. And you score that. And you break it up, and you need to figure out which part of my business do I pour the gas on and which part do I really just kind of ignore or I let coast? Right? Just give it as little gas I can get away with while I build the others, because 20% of your business is gonna produce 80% of the growth in the future, and the rest of it’s just gonna waste your time.

I think a lot of us aren’t really honest with ourselves about where our business is actually at and what it can really produce, and you need to be the winner. There is probably some part of your market where if you’re like, “Well, this part of the market isn’t very well served right now. Nobody else is really truly paying attention to this aspect, and I could totally nail it. And if I really put my resources into it, I could emerge as the absolute dominant player within six or 12 months,” and that’s what you should do.

John Jantsch: Visiting with Perry Marshal. We’re talking about the 80-20 principle, which is now 95-5 online. Winner take all is the game that we’re playing. Perry, thanks so much for joining us. Where can people find probably the best place to plug in to your, kind of, vast universe?

Perry Marshall: You can go to http://ift.tt/1TMHaKs. And just start by reading 80-20 in sales and marketing and just know that it’s even more true now than it was in 2013 when I wrote it. And the race is on. The race is on. It’s winner take it all, and whatever it is that you do, you need to find the thing where you can be number one, and you can totally dominate and be a category of one, because all..

http://ift.tt/2iF42kB

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Transcript of Unlocking the Power of 80/20

Transcript of Unlocking the Power of 80/20

Transcript of Unlocking the Power of 80/20 written by John Jantsch read more at Duct Tape Marketing

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John Jantsch: Hello and welcome to another episode of the Duct Tape Marketing Podcast. This is your host, John Jantsch, and my guest today is Perry Marshall. He’s an online marketing strategist, entrepreneur, and author of numerous books, including one we’re gonna talk about today, the 80-20 of sales and marketing. So, Perry, thanks for joining me.

Perry Marshall: John, it’s great to be here. It was great to be at your summit a couple of years ago where I met a lot of your people. The world just seems to be getting more and more eccentric, and there’s a lot for us to talk about today. Man, you’re either harnessing the eccentricity, or it’s pounding you on the back of the head with a two by four. And there’s not much in the middle, so very timely.

John Jantsch: Let’s get kind of a baseline. I mean, everybody’s heard the 80-20 thing. It’s almost become cliché how people apply it. But I don’t know that that many people, and this is your contention with the book, that many people get the leverage that it provides at a business level, do they?

Perry Marshall: No. First off, it’s not just a business rule of thumb. It’s a fact of nature. And, in fact, if I go to the beach with a bucket, and I pull out a bucket of sand, the sizes of the sand grains is gonna be 80-20. And how much water is in all the rivers is 80-20. The dirt on your carpet is 80-20, and the files in your hard drive. Okay? That’s the first thing. The second thing is that there’s an 80-20 inside every 80-20. When people really get this, it kind of flips them out. And so I can run a spreadsheet or a sales report of all my customers, and if I sort it from top to bottom, 20% of my customers are gonna generate 80% of the sales, but then if I chop off the bottom 80% that only produces 20%, whatever’s left, that top 20%, it’s still 80-20.

And I can do that again. And 4% of my customers are 64% of my business. And then I could do it again, and 1% of the customers are 50%. Well, this is true in almost any part of your business, and we’ll get into that. But then there’s a third thing. And this is probably a little bit new to most people, but the world is really becoming much more 95-5 where 5% of your efforts or your customers produce 95% of your results, and the other 95% only produces 5%. And this is especially true online. I’ve been watching this develop. People really need to understand this. The world is not … Cause and effect in the world operate fundamentally different than they did even 15 years ago. And I don’t think most people have gotten the memo. There’s a lot of examples of this out there.

John Jantsch: Let me stop you there, because I want to clarify something. And we’ll get, obviously, into examples, and I want to go back to the nature comment.

Perry Marshall: Yes.

John Jantsch: But it’s the simple kind of no-brainer lesson, then, to say, “Look, 95%” or if we want to use 80-20, still, to not scare too many people, is 80% of what you’re doing a waste of your time almost? I mean, especially when you get 95-5. It’s like 95% of my effort is on 5%? Quit doing that?

Perry Marshall: Well, yeah or almost, okay? You’ll always find that there’s a bunch of those things that somebody’s gotta do. It might not be you. It shouldn’t be you, but it’s gotta be somebody. But for example, 80 to 95% of all businesses fail or most entrepreneurs, we have all these little projects that we get into, and the project is a miniature little business, truth be told. Even if we didn’t go form an LLC or something. But actually anywhere from four-fifths to nine-tenths of those really don’t produce anything at the end of the day. And what’s happening in the world is that there’s more and more people kind of getting nowhere or just treading water or altogether losing, and then there’s this minority of people that are just absolutely slamming the ball out of the park, like it’s a triple. It’s a home run and then some. There’s less and less that’s in the middle. And so I think people today have to be more ruthless about how they spend their time than they’ve ever been before. There’s never been a time when busy work would get you less far than it does right now.

John Jantsch: And there’s probably never been more busy work.

Perry Marshall: Oh my gah. Yeah. Like, amazing amounts of busy work, and it doesn’t even look like busy work on the surface. You have to be really discerning. Lots of things, they just sound like good ideas, and a lot of them are based on, well, it’s really what was working in 2003, and it’s not really based on what’s going on right now. So I am issuing a wake up call.

John Jantsch: So let me go back to the nature comment about the grains of sand on the beach or all the things you cited from nature. I mean, is there some sort of principle that suggests why that’s the case?

Perry Marshall: Yes. Yes, and I’m not gonna get super theoretical. I could go into all kinds of stuff about chaos theory. This is really what it’s based on. But, John, I just want you to imagine that we put a table in the middle of your living room, and we went to some machine shop, and we machined the top of that table to be absolutely flat to within 100,000th of an inch, and it was a mirror finish. But then I want you to imagine that there’s a leak in your roof, and now we’re gonna drip water on that table, and the water is gonna drip into the middle of the table. So here’s a question of, “If I have the table perfectly level, and it’s perfectly flat, does that mean that the water is going to evenly spread out on the table, and then drip off the edge of the table in a smooth-flowing stream?

John Jantsch: My guess is it would probably gather as much energy to spread itself out in a very small section of where it landed.

Perry Marshall: Well, right. Right. And what would happen is no matter how flat you try to make that table, it’s gonna be a little bit easier for the water to go in one direction than the other ones, and then it starts going. And once it starts going, well, the erosion will wear, and then a million years later, there’s gonna be this big giant groove in the middle of your table that started out as flat. There’s nothing you could do to make the water flow equally. And here’s the thing is everything in life and nature is like that. So how water erodes or, for example, you’ve 10 14-year-old kids yesterday tried Jack Daniels for the first time. And maybe they all sort of liked it. But one of them liked it a little more than the rest of them, and so 30 years from now the rest of them all take a drink a week or two drinks a week and one of them has five drinks before breakfast, and he’s an alcoholic.

Okay? So your customers are like that. And my customers are like that. Everything is unequal. And the thing is is education conditions treat everything like it’s equal, treat everybody like they’re equal. The teachers try to make all the kids equal. Well, I just want everybody to get A’s and B’s. It’s like, “Well, they’re not going to.” And so entrepreneurs harness the eccentricities where a lot of more ivory tower people, they kind of try to pretend they’re not there. And so you have to just completely reverse the normal way that you think.

John Jantsch: Okay. So for that person out there that’s thinking, “Where in the world is this going and why is this gonna apply to my business?” Let’s bring it back to something very practical inside a business. How could somebody start spotting that 95% opportunity?

Perry Marshall: Let me tell you a story, and maybe a couple of your people have heard this one before, but this is my favorite 80-20 story. I have a friend named John Paul [inaudible 00:10:15] who dropped out of high school when he was 17, and he hitchhiked from Denver to Las Vegas with a couple of gambling books under his arm, and he’s like, “I’m gonna become a professional gambler.” He starts going to casinos and playing poker every day and living by his whits at age 17. And after a few weeks of this he was like, “Dang. This is harder than I thought.” He bumps into this guy who runs a gambling ring named Rob, and he starts talking to him. And he says, “Well, could you teach me how to do this?” And Rob says, “For a percentage of your winnings I could teach you how to do this.” And so they shake on it.

And after they do that, “Hey, jump in the jeep, John. We’re going for a ride.” So they get in the car, and they’re going down the highway, and John says, “Okay. So how do I win more poker games?” And Rob goes, “You have to play people who are going to lose. And those people are called marks, and you need to find the marks in the room, and you need to play poker with them, and you don’t play poker with anybody else.” And he says, “Well, how do I find the marks?” And he says, “Here. I’ll show you.” And he pulls into a parking lot of a strip club, and they go in there. And there’s women and there’s rock and roll, and there’s people drinking and all this commotion and noise in there.

And he sits down at the table, and Rob pulls a sawed off shotgun out of his jacket. And he opens the chamber, and under the table, then he snaps it shut and it goes “chitch.” And all these guys look around. And John sees them. And the owner come over, and he says, “Hey, what’s going on over here?” And Rob goes, “Hey, we’re just fine. There’s no problem here. We’re just teaching the lad a lesson, not gonna cause any trouble. Don’t worry about us.” And then Rob turns to John and he says, “John, did you see those guys who turned around when I made that noise?” And he’s like, “Yeah. Those biker guys over there?” “Yeah, those guys.” And John goes, “Yeah.” And he says, “Don’t play poker with them. They’re not marks. Play poker with everybody else.”

Now, that was what I call racking the shotgun, and everything you do in marketing is rack the shotgun. In fact, I’ve trained my customers and clients to use that phrase all the time. Rack the shotgun is when you … You know who racks the shotgun all the time is Donald Trump, okay? Now, I’m not saying he does it for good reasons or whatever. I’m not making any statements about any of that, but he does it. Okay? And he gets a response. Now, what I have always found out is most people are instinctively afraid to rack the shotgun. They’re afraid to find out the truth. They’re afraid to go make that big noise out there and see, “Okay, who’s gonna turn their head and who’s gonna ignore?” Or, “Who’s gonna say no and who’s gonna say yes.”

I mean, it could even go all the way down to your teenager like, “Well, you know, I don’t want to … She came in at 2:30 in the morning last night, and I don’t really want to ruffle any feathers, and we seem to be getting” … Well, that’s like being afraid to rack the shotgun. Like, well, if you don’t know why your teenager came in at 2:30 in the morning, then whatever the reason is is probably not a good one, right? But you have to ask.

John Jantsch: Ignorance is bliss, right? Yeah.

Perry Marshall: I talked to a guy about … He owned a smoothie store, and he was doing all this Facebook and social media stuff, and I’d go, “Well, do you ever send them emails?” He goes, “No, I’m afraid of them unsubscribing.” Well, that’s racking the shotgun, man. I said, “Email is 10 times better than social media. You’re not emailing, because you’re afraid some people won’t like it? Send them an email. Let them unsubscribe. It’s fine.” In fact, if you’re unsubscribe rate is less than 5% or even 10, you’re probably not selling hard enough. So everything you do, everything you do in marketing is racking the shotgun.

John Jantsch: So what you’re, again, coming back to my original question on that, what you’re suggesting is that’s how you’re gonna find the leverage?

Perry Marshall: Yeah. With people, right, you’re gonna find that most people actually aren’t gonna respond to anything that you do. They’re never gonna buy, okay? And maybe it’s 80% aren’t gonna buy or maybe it’s 60% or maybe it’s 95% aren’t gonna buy. But there is a rack the shotgun just with buying. Now, the interesting part about 80-20 is that if you rack a shotgun, and you get, let’s call it $100 shotgun. It’s a $100 transaction, let’s say, and you get 100 people to respond. Well, if you quadruple the price, if you rack a $400 shotgun, 20% of those people will respond again. And if you rack a $1,600 shotgun, 20% of those people will respond again. If you rack a $6,400 shotgun, 20% of those people will respond again. And so you’ll find that even though you started with only 100 people, let’s say, who would spend $100, you might find one person who would spend $50,000. And you didn’t know it, and that person was already there. That person is already in your audience. And what I am seeing is that all of this is becoming more pronounced than it used to be.

John Jantsch: So it really, I mean, again, one of the sort of core principles was you build a business, you got customers. You need to be trying to sell them more. I mean, essentially you’re saying that, but maybe at a level people haven’t considered, that not just is there an opportunity to maybe sell more, but that there is a sort of almost mathematical equation that says what you should you sell them and how much it should cost and who’s gonna respond?

Perry Marshall: That’s right. There is a hunger in the marketplace that there’s a small percentage of people who they have an extreme itch that they would like to scratch. And it’s almost unscratchable. When it’s just your product line, there’s some other things I want to get into, but let’s just restrict it to your product line right now. So 80-20 says, “If I have a Starbucks, and a thousand a people a month are buying a $5 latte, one of those people will buy a $2,700 gleaming stainless steel espresso machine.” And it’s just about a law of physics. Now, I started to notice something really interesting when I started teaching Google AdWords. I wrote the world’s best selling books on Google and Facebook advertising, and all of a sudden when AdWords came into existence, all of these new businesses that might not have even been able to exist before suddenly popped up.

And it was this giant feeding frenzy and gold rush. And what I noticed was that if somebody could get to the top in AdWords, they could get the number one position, which gets the most traffic. And then if they could streamline all the stuff in their website, the shopping cart, the sales pages, the landing pages, the offer, the unique selling proposition, if they could dial all that in and test it to the hilt, they would get to a point where nobody could shove them out of the way. They’re number one, they might be number on TV, and they might not be number one on the radio, and they might not be number one on main street, but if they’re number one in Google AdWords, and if they got their sales machine dialed in, they’re almost unstoppable.

Now, here’s why this was. It was because number two, number three, number four, number five, they all have to test their way to success, and they have to experimentally find what works, but you’re already getting more traffic than they are, and you can already do more tests than they are. And so you’re previous success greases the skids for you to continue to be successful, because you’re the incumbent. Well, I’ve been watching very carefully, and what I’ve seen is that an incumbent in the brick and mortar world is 80-20, but an incumbent in the digital world is 95-5. So here’s an example of this. You could go ask your 10-year-old kid, “Can you name a dozen car manufacturers?” And any 10-year-old kid could think of a dozen, Ferrari and Toyota and Kia. They could come up with a list. But can anybody name 12 search engines or 12 auction sites or 12 bookstores where you can buy any book?

John Jantsch: Well, I don’t know about you, but I have the top 100 search engines that every business should be in sitting right here next to me. I’m being facetious, of course, but remember when people used to talk about that.

Perry Marshall: Right. Right. And they all got washed out. Well, that’s because the internet is frictionless. So making cars, that’s friction all the way. Whether you go to the Toyota dealership or the Ford dealership, you have to drive across town, right? Okay. And so that supports there being 12 different car manufacturers. But if it’s Bing versus Google, there’s literally no difference whether you type in B-I-N-G or G-O-O-G-L-E on your browser. The only thing that makes a difference is how much you enjoy the experience. If Google is 10% better, then pretty soon everybody’s gonna use Google, and the Google’s gonna become 1,000% better, because they have more data and more customers and more bells and whistles and more everything. And pretty soon Bing doesn’t really have a chance.

And, see, everything in online marketing is like this. Basically, you’re either number one or you’re nobody. And I don’t think most people have really gotten this that this has happened. You’re either number one or you’re nothing. So that old phrase being a category of one, oh, it’s dead serious no. In a 95-5 world you have to be the number one. Whatever you do, you have to be the only one or you are hamburger.

John Jantsch: I think you can see that at a very real level for the local plumber, for example. I mean, all the searches are being done on a mobile device, and Google is determining, “Here’s the three positions that they’re gonna show.” And certainly if you don’t show up in those three, and as you suggest maybe number one of those three, you really don’t exist, I think. And so the digital world is even cutting into the world of friction.

Perry Marshall: It is.

John Jantsch: We may see a day when there’s only one car sale search engine, and the manufacturers are really, I think, playing basically to be there.

Perry Marshall: So I’ll make a prediction right now is that 10 years from now self-driving cars will be extremely common, and half of the auto manufacturers will either be out of business or bought out by the winners.

John Jantsch: Yeah. Yeah, because to some extent the brand won’t matter anymore.

Perry Marshall: No. It won’t. So watch out. Now, if you know this, if you know this, you can make predictions about the future. In many cases if you project 10 years in the future, if you are already pretty much know who the winner is, then you can bet on the winner, and you’ll gain. If there’s somebody out there … I don’t know. I don’t know who it might be, but if somebody out there already pretty much knows who’s gonna control the self-driving car thing, then you buy stock in that company. In 10 years from now you’ll be happy about it, because there probably isn’t that much that anybody can do even right now to change it. To give you another idea, there’s Bitcoin and there’s Ethereum, and there’s all these other little cryptocurrencies. Bitcoin already won. All the rest of them, that’s like .net, .cc, .name, .whatever. It’s just like domain names. They’ll have their little day in the sun and people will think. Bitcoin’s already won. It’s the winner-take-all phenomenon is on steroids.

John Jantsch:  I’m trying to figure out which direction to take this, because there’s so many we can go, and we’re really already out of time. So let me ask you how somebody would … And I’m trying to, again, end it on a really practical note. How would somebody apply this to an existing business? I can see a lot of people thinking, “Okay. If I could figure out this thing and predict the future, and I’ll create a business around that.” But how could somebody apply this? I mean, is this something that you have to have an epiphany? Or is this something that you have to just go out and start testing things in a certain way?

Perry Marshall: So here’s what you can do, and this is extremely practical. Richard [inaudible 00:26:29] and I put together this website called StarPrinciple.com. It’s free, and you can go click a dozen radio buttons and score your business. Basically it tells you how likely it is that you can dominate the niche that you’re in right now. It’s kind of a truth serum of this winner-take-all thing. So the score goes from zero to 200 points, and anything over 100 points is a home run. Okay? Now, some businesses will get a 25, and some will get a 75, and some will get 150. If you’re 150, man, you’re good, and you should pour on the gas. Well, so here’s what you do. Most of our businesses are really three or four businesses or three or four product lines or three or four markets, and they’re all kind of one umbrella. Here’s what you need to do. This could save somebody years of heartache and frustration right here. Okay?

You go, “All right. Well, I have product A, B, C, D. I have market A, B, C, D.” You score each one individually, because in one of your markets you’re really the number six player. In one of your markets you’re the number one player. One market is shrinking, and one market is growing. And you score that. And you break it up, and you need to figure out which part of my business do I pour the gas on and which part do I really just kind of ignore or I let coast? Right? Just give it as little gas I can get away with while I build the others, because 20% of your business is gonna produce 80% of the growth in the future, and the rest of it’s just gonna waste your time.

I think a lot of us aren’t really honest with ourselves about where our business is actually at and what it can really produce, and you need to be the winner. There is probably some part of your market where if you’re like, “Well, this part of the market isn’t very well served right now. Nobody else is really truly paying attention to this aspect, and I could totally nail it. And if I really put my resources into it, I could emerge as the absolute dominant player within six or 12 months,” and that’s what you should do.

John Jantsch: Visiting with Perry Marshal. We’re talking about the 80-20 principle, which is now 95-5 online. Winner take all is the game that we’re playing. Perry, thanks so much for joining us. Where can people find probably the best place to plug in to your, kind of, vast universe?

Perry Marshall: You can go to http://ift.tt/1TMHaKs. And just start by reading 80-20 in sales and marketing and just know that it’s even more true now than it was in 2013 when I wrote it. And the race is on. The race is on. It’s winner take it all, and whatever it is that you do, you need to find the thing where you can be number one, and you can totally dominate and be a category of one, because all..

http://ift.tt/2iF42kB

#FEED 9 MARKETING

[vidmarket32514]

Transcript of Unlocking the Power of 80/20

Transcript of Unlocking the Power of 80/20

Transcript of Unlocking the Power of 80/20 written by John Jantsch read more at Duct Tape Marketing

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John Jantsch: Hello and welcome to another episode of the Duct Tape Marketing Podcast. This is your host, John Jantsch, and my guest today is Perry Marshall. He’s an online marketing strategist, entrepreneur, and author of numerous books, including one we’re gonna talk about today, the 80-20 of sales and marketing. So, Perry, thanks for joining me.

Perry Marshall: John, it’s great to be here. It was great to be at your summit a couple of years ago where I met a lot of your people. The world just seems to be getting more and more eccentric, and there’s a lot for us to talk about today. Man, you’re either harnessing the eccentricity, or it’s pounding you on the back of the head with a two by four. And there’s not much in the middle, so very timely.

John Jantsch: Let’s get kind of a baseline. I mean, everybody’s heard the 80-20 thing. It’s almost become cliché how people apply it. But I don’t know that that many people, and this is your contention with the book, that many people get the leverage that it provides at a business level, do they?

Perry Marshall: No. First off, it’s not just a business rule of thumb. It’s a fact of nature. And, in fact, if I go to the beach with a bucket, and I pull out a bucket of sand, the sizes of the sand grains is gonna be 80-20. And how much water is in all the rivers is 80-20. The dirt on your carpet is 80-20, and the files in your hard drive. Okay? That’s the first thing. The second thing is that there’s an 80-20 inside every 80-20. When people really get this, it kind of flips them out. And so I can run a spreadsheet or a sales report of all my customers, and if I sort it from top to bottom, 20% of my customers are gonna generate 80% of the sales, but then if I chop off the bottom 80% that only produces 20%, whatever’s left, that top 20%, it’s still 80-20.

And I can do that again. And 4% of my customers are 64% of my business. And then I could do it again, and 1% of the customers are 50%. Well, this is true in almost any part of your business, and we’ll get into that. But then there’s a third thing. And this is probably a little bit new to most people, but the world is really becoming much more 95-5 where 5% of your efforts or your customers produce 95% of your results, and the other 95% only produces 5%. And this is especially true online. I’ve been watching this develop. People really need to understand this. The world is not … Cause and effect in the world operate fundamentally different than they did even 15 years ago. And I don’t think most people have gotten the memo. There’s a lot of examples of this out there.

John Jantsch: Let me stop you there, because I want to clarify something. And we’ll get, obviously, into examples, and I want to go back to the nature comment.

Perry Marshall: Yes.

John Jantsch: But it’s the simple kind of no-brainer lesson, then, to say, “Look, 95%” or if we want to use 80-20, still, to not scare too many people, is 80% of what you’re doing a waste of your time almost? I mean, especially when you get 95-5. It’s like 95% of my effort is on 5%? Quit doing that?

Perry Marshall: Well, yeah or almost, okay? You’ll always find that there’s a bunch of those things that somebody’s gotta do. It might not be you. It shouldn’t be you, but it’s gotta be somebody. But for example, 80 to 95% of all businesses fail or most entrepreneurs, we have all these little projects that we get into, and the project is a miniature little business, truth be told. Even if we didn’t go form an LLC or something. But actually anywhere from four-fifths to nine-tenths of those really don’t produce anything at the end of the day. And what’s happening in the world is that there’s more and more people kind of getting nowhere or just treading water or altogether losing, and then there’s this minority of people that are just absolutely slamming the ball out of the park, like it’s a triple. It’s a home run and then some. There’s less and less that’s in the middle. And so I think people today have to be more ruthless about how they spend their time than they’ve ever been before. There’s never been a time when busy work would get you less far than it does right now.

John Jantsch: And there’s probably never been more busy work.

Perry Marshall: Oh my gah. Yeah. Like, amazing amounts of busy work, and it doesn’t even look like busy work on the surface. You have to be really discerning. Lots of things, they just sound like good ideas, and a lot of them are based on, well, it’s really what was working in 2003, and it’s not really based on what’s going on right now. So I am issuing a wake up call.

John Jantsch: So let me go back to the nature comment about the grains of sand on the beach or all the things you cited from nature. I mean, is there some sort of principle that suggests why that’s the case?

Perry Marshall: Yes. Yes, and I’m not gonna get super theoretical. I could go into all kinds of stuff about chaos theory. This is really what it’s based on. But, John, I just want you to imagine that we put a table in the middle of your living room, and we went to some machine shop, and we machined the top of that table to be absolutely flat to within 100,000th of an inch, and it was a mirror finish. But then I want you to imagine that there’s a leak in your roof, and now we’re gonna drip water on that table, and the water is gonna drip into the middle of the table. So here’s a question of, “If I have the table perfectly level, and it’s perfectly flat, does that mean that the water is going to evenly spread out on the table, and then drip off the edge of the table in a smooth-flowing stream?

John Jantsch: My guess is it would probably gather as much energy to spread itself out in a very small section of where it landed.

Perry Marshall: Well, right. Right. And what would happen is no matter how flat you try to make that table, it’s gonna be a little bit easier for the water to go in one direction than the other ones, and then it starts going. And once it starts going, well, the erosion will wear, and then a million years later, there’s gonna be this big giant groove in the middle of your table that started out as flat. There’s nothing you could do to make the water flow equally. And here’s the thing is everything in life and nature is like that. So how water erodes or, for example, you’ve 10 14-year-old kids yesterday tried Jack Daniels for the first time. And maybe they all sort of liked it. But one of them liked it a little more than the rest of them, and so 30 years from now the rest of them all take a drink a week or two drinks a week and one of them has five drinks before breakfast, and he’s an alcoholic.

Okay? So your customers are like that. And my customers are like that. Everything is unequal. And the thing is is education conditions treat everything like it’s equal, treat everybody like they’re equal. The teachers try to make all the kids equal. Well, I just want everybody to get A’s and B’s. It’s like, “Well, they’re not going to.” And so entrepreneurs harness the eccentricities where a lot of more ivory tower people, they kind of try to pretend they’re not there. And so you have to just completely reverse the normal way that you think.

John Jantsch: Okay. So for that person out there that’s thinking, “Where in the world is this going and why is this gonna apply to my business?” Let’s bring it back to something very practical inside a business. How could somebody start spotting that 95% opportunity?

Perry Marshall: Let me tell you a story, and maybe a couple of your people have heard this one before, but this is my favorite 80-20 story. I have a friend named John Paul [inaudible 00:10:15] who dropped out of high school when he was 17, and he hitchhiked from Denver to Las Vegas with a couple of gambling books under his arm, and he’s like, “I’m gonna become a professional gambler.” He starts going to casinos and playing poker every day and living by his whits at age 17. And after a few weeks of this he was like, “Dang. This is harder than I thought.” He bumps into this guy who runs a gambling ring named Rob, and he starts talking to him. And he says, “Well, could you teach me how to do this?” And Rob says, “For a percentage of your winnings I could teach you how to do this.” And so they shake on it.

And after they do that, “Hey, jump in the jeep, John. We’re going for a ride.” So they get in the car, and they’re going down the highway, and John says, “Okay. So how do I win more poker games?” And Rob goes, “You have to play people who are going to lose. And those people are called marks, and you need to find the marks in the room, and you need to play poker with them, and you don’t play poker with anybody else.” And he says, “Well, how do I find the marks?” And he says, “Here. I’ll show you.” And he pulls into a parking lot of a strip club, and they go in there. And there’s women and there’s rock and roll, and there’s people drinking and all this commotion and noise in there.

And he sits down at the table, and Rob pulls a sawed off shotgun out of his jacket. And he opens the chamber, and under the table, then he snaps it shut and it goes “chitch.” And all these guys look around. And John sees them. And the owner come over, and he says, “Hey, what’s going on over here?” And Rob goes, “Hey, we’re just fine. There’s no problem here. We’re just teaching the lad a lesson, not gonna cause any trouble. Don’t worry about us.” And then Rob turns to John and he says, “John, did you see those guys who turned around when I made that noise?” And he’s like, “Yeah. Those biker guys over there?” “Yeah, those guys.” And John goes, “Yeah.” And he says, “Don’t play poker with them. They’re not marks. Play poker with everybody else.”

Now, that was what I call racking the shotgun, and everything you do in marketing is rack the shotgun. In fact, I’ve trained my customers and clients to use that phrase all the time. Rack the shotgun is when you … You know who racks the shotgun all the time is Donald Trump, okay? Now, I’m not saying he does it for good reasons or whatever. I’m not making any statements about any of that, but he does it. Okay? And he gets a response. Now, what I have always found out is most people are instinctively afraid to rack the shotgun. They’re afraid to find out the truth. They’re afraid to go make that big noise out there and see, “Okay, who’s gonna turn their head and who’s gonna ignore?” Or, “Who’s gonna say no and who’s gonna say yes.”

I mean, it could even go all the way down to your teenager like, “Well, you know, I don’t want to … She came in at 2:30 in the morning last night, and I don’t really want to ruffle any feathers, and we seem to be getting” … Well, that’s like being afraid to rack the shotgun. Like, well, if you don’t know why your teenager came in at 2:30 in the morning, then whatever the reason is is probably not a good one, right? But you have to ask.

John Jantsch: Ignorance is bliss, right? Yeah.

Perry Marshall: I talked to a guy about … He owned a smoothie store, and he was doing all this Facebook and social media stuff, and I’d go, “Well, do you ever send them emails?” He goes, “No, I’m afraid of them unsubscribing.” Well, that’s racking the shotgun, man. I said, “Email is 10 times better than social media. You’re not emailing, because you’re afraid some people won’t like it? Send them an email. Let them unsubscribe. It’s fine.” In fact, if you’re unsubscribe rate is less than 5% or even 10, you’re probably not selling hard enough. So everything you do, everything you do in marketing is racking the shotgun.

John Jantsch: So what you’re, again, coming back to my original question on that, what you’re suggesting is that’s how you’re gonna find the leverage?

Perry Marshall: Yeah. With people, right, you’re gonna find that most people actually aren’t gonna respond to anything that you do. They’re never gonna buy, okay? And maybe it’s 80% aren’t gonna buy or maybe it’s 60% or maybe it’s 95% aren’t gonna buy. But there is a rack the shotgun just with buying. Now, the interesting part about 80-20 is that if you rack a shotgun, and you get, let’s call it $100 shotgun. It’s a $100 transaction, let’s say, and you get 100 people to respond. Well, if you quadruple the price, if you rack a $400 shotgun, 20% of those people will respond again. And if you rack a $1,600 shotgun, 20% of those people will respond again. If you rack a $6,400 shotgun, 20% of those people will respond again. And so you’ll find that even though you started with only 100 people, let’s say, who would spend $100, you might find one person who would spend $50,000. And you didn’t know it, and that person was already there. That person is already in your audience. And what I am seeing is that all of this is becoming more pronounced than it used to be.

John Jantsch: So it really, I mean, again, one of the sort of core principles was you build a business, you got customers. You need to be trying to sell them more. I mean, essentially you’re saying that, but maybe at a level people haven’t considered, that not just is there an opportunity to maybe sell more, but that there is a sort of almost mathematical equation that says what you should you sell them and how much it should cost and who’s gonna respond?

Perry Marshall: That’s right. There is a hunger in the marketplace that there’s a small percentage of people who they have an extreme itch that they would like to scratch. And it’s almost unscratchable. When it’s just your product line, there’s some other things I want to get into, but let’s just restrict it to your product line right now. So 80-20 says, “If I have a Starbucks, and a thousand a people a month are buying a $5 latte, one of those people will buy a $2,700 gleaming stainless steel espresso machine.” And it’s just about a law of physics. Now, I started to notice something really interesting when I started teaching Google AdWords. I wrote the world’s best selling books on Google and Facebook advertising, and all of a sudden when AdWords came into existence, all of these new businesses that might not have even been able to exist before suddenly popped up.

And it was this giant feeding frenzy and gold rush. And what I noticed was that if somebody could get to the top in AdWords, they could get the number one position, which gets the most traffic. And then if they could streamline all the stuff in their website, the shopping cart, the sales pages, the landing pages, the offer, the unique selling proposition, if they could dial all that in and test it to the hilt, they would get to a point where nobody could shove them out of the way. They’re number one, they might be number on TV, and they might not be number one on the radio, and they might not be number one on main street, but if they’re number one in Google AdWords, and if they got their sales machine dialed in, they’re almost unstoppable.

Now, here’s why this was. It was because number two, number three, number four, number five, they all have to test their way to success, and they have to experimentally find what works, but you’re already getting more traffic than they are, and you can already do more tests than they are. And so you’re previous success greases the skids for you to continue to be successful, because you’re the incumbent. Well, I’ve been watching very carefully, and what I’ve seen is that an incumbent in the brick and mortar world is 80-20, but an incumbent in the digital world is 95-5. So here’s an example of this. You could go ask your 10-year-old kid, “Can you name a dozen car manufacturers?” And any 10-year-old kid could think of a dozen, Ferrari and Toyota and Kia. They could come up with a list. But can anybody name 12 search engines or 12 auction sites or 12 bookstores where you can buy any book?

John Jantsch: Well, I don’t know about you, but I have the top 100 search engines that every business should be in sitting right here next to me. I’m being facetious, of course, but remember when people used to talk about that.

Perry Marshall: Right. Right. And they all got washed out. Well, that’s because the internet is frictionless. So making cars, that’s friction all the way. Whether you go to the Toyota dealership or the Ford dealership, you have to drive across town, right? Okay. And so that supports there being 12 different car manufacturers. But if it’s Bing versus Google, there’s literally no difference whether you type in B-I-N-G or G-O-O-G-L-E on your browser. The only thing that makes a difference is how much you enjoy the experience. If Google is 10% better, then pretty soon everybody’s gonna use Google, and the Google’s gonna become 1,000% better, because they have more data and more customers and more bells and whistles and more everything. And pretty soon Bing doesn’t really have a chance.

And, see, everything in online marketing is like this. Basically, you’re either number one or you’re nobody. And I don’t think most people have really gotten this that this has happened. You’re either number one or you’re nothing. So that old phrase being a category of one, oh, it’s dead serious no. In a 95-5 world you have to be the number one. Whatever you do, you have to be the only one or you are hamburger.

John Jantsch: I think you can see that at a very real level for the local plumber, for example. I mean, all the searches are being done on a mobile device, and Google is determining, “Here’s the three positions that they’re gonna show.” And certainly if you don’t show up in those three, and as you suggest maybe number one of those three, you really don’t exist, I think. And so the digital world is even cutting into the world of friction.

Perry Marshall: It is.

John Jantsch: We may see a day when there’s only one car sale search engine, and the manufacturers are really, I think, playing basically to be there.

Perry Marshall: So I’ll make a prediction right now is that 10 years from now self-driving cars will be extremely common, and half of the auto manufacturers will either be out of business or bought out by the winners.

John Jantsch: Yeah. Yeah, because to some extent the brand won’t matter anymore.

Perry Marshall: No. It won’t. So watch out. Now, if you know this, if you know this, you can make predictions about the future. In many cases if you project 10 years in the future, if you are already pretty much know who the winner is, then you can bet on the winner, and you’ll gain. If there’s somebody out there … I don’t know. I don’t know who it might be, but if somebody out there already pretty much knows who’s gonna control the self-driving car thing, then you buy stock in that company. In 10 years from now you’ll be happy about it, because there probably isn’t that much that anybody can do even right now to change it. To give you another idea, there’s Bitcoin and there’s Ethereum, and there’s all these other little cryptocurrencies. Bitcoin already won. All the rest of them, that’s like .net, .cc, .name, .whatever. It’s just like domain names. They’ll have their little day in the sun and people will think. Bitcoin’s already won. It’s the winner-take-all phenomenon is on steroids.

John Jantsch:  I’m trying to figure out which direction to take this, because there’s so many we can go, and we’re really already out of time. So let me ask you how somebody would … And I’m trying to, again, end it on a really practical note. How would somebody apply this to an existing business? I can see a lot of people thinking, “Okay. If I could figure out this thing and predict the future, and I’ll create a business around that.” But how could somebody apply this? I mean, is this something that you have to have an epiphany? Or is this something that you have to just go out and start testing things in a certain way?

Perry Marshall: So here’s what you can do, and this is extremely practical. Richard [inaudible 00:26:29] and I put together this website called StarPrinciple.com. It’s free, and you can go click a dozen radio buttons and score your business. Basically it tells you how likely it is that you can dominate the niche that you’re in right now. It’s kind of a truth serum of this winner-take-all thing. So the score goes from zero to 200 points, and anything over 100 points is a home run. Okay? Now, some businesses will get a 25, and some will get a 75, and some will get 150. If you’re 150, man, you’re good, and you should pour on the gas. Well, so here’s what you do. Most of our businesses are really three or four businesses or three or four product lines or three or four markets, and they’re all kind of one umbrella. Here’s what you need to do. This could save somebody years of heartache and frustration right here. Okay?

You go, “All right. Well, I have product A, B, C, D. I have market A, B, C, D.” You score each one individually, because in one of your markets you’re really the number six player. In one of your markets you’re the number one player. One market is shrinking, and one market is growing. And you score that. And you break it up, and you need to figure out which part of my business do I pour the gas on and which part do I really just kind of ignore or I let coast? Right? Just give it as little gas I can get away with while I build the others, because 20% of your business is gonna produce 80% of the growth in the future, and the rest of it’s just gonna waste your time.

I think a lot of us aren’t really honest with ourselves about where our business is actually at and what it can really produce, and you need to be the winner. There is probably some part of your market where if you’re like, “Well, this part of the market isn’t very well served right now. Nobody else is really truly paying attention to this aspect, and I could totally nail it. And if I really put my resources into it, I could emerge as the absolute dominant player within six or 12 months,” and that’s what you should do.

John Jantsch: Visiting with Perry Marshal. We’re talking about the 80-20 principle, which is now 95-5 online. Winner take all is the game that we’re playing. Perry, thanks so much for joining us. Where can people find probably the best place to plug in to your, kind of, vast universe?

Perry Marshall: You can go to http://ift.tt/1TMHaKs. And just start by reading 80-20 in sales and marketing and just know that it’s even more true now than it was in 2013 when I wrote it. And the race is on. The race is on. It’s winner take it all, and whatever it is that you do, you need to find the thing where you can be number one, and you can totally dominate and be a category of one, because all..

http://ift.tt/2iF42kB

#FEED 9 MARKETING

[restateagnt17101]

Transcript of Unlocking the Power of 80/20

Transcript of Unlocking the Power of 80/20

Transcript of Unlocking the Power of 80/20 written by John Jantsch read more at Duct Tape Marketing

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Transcript

John Jantsch: Hello and welcome to another episode of the Duct Tape Marketing Podcast. This is your host, John Jantsch, and my guest today is Perry Marshall. He’s an online marketing strategist, entrepreneur, and author of numerous books, including one we’re gonna talk about today, the 80-20 of sales and marketing. So, Perry, thanks for joining me.

Perry Marshall: John, it’s great to be here. It was great to be at your summit a couple of years ago where I met a lot of your people. The world just seems to be getting more and more eccentric, and there’s a lot for us to talk about today. Man, you’re either harnessing the eccentricity, or it’s pounding you on the back of the head with a two by four. And there’s not much in the middle, so very timely.

John Jantsch: Let’s get kind of a baseline. I mean, everybody’s heard the 80-20 thing. It’s almost become cliché how people apply it. But I don’t know that that many people, and this is your contention with the book, that many people get the leverage that it provides at a business level, do they?

Perry Marshall: No. First off, it’s not just a business rule of thumb. It’s a fact of nature. And, in fact, if I go to the beach with a bucket, and I pull out a bucket of sand, the sizes of the sand grains is gonna be 80-20. And how much water is in all the rivers is 80-20. The dirt on your carpet is 80-20, and the files in your hard drive. Okay? That’s the first thing. The second thing is that there’s an 80-20 inside every 80-20. When people really get this, it kind of flips them out. And so I can run a spreadsheet or a sales report of all my customers, and if I sort it from top to bottom, 20% of my customers are gonna generate 80% of the sales, but then if I chop off the bottom 80% that only produces 20%, whatever’s left, that top 20%, it’s still 80-20.

And I can do that again. And 4% of my customers are 64% of my business. And then I could do it again, and 1% of the customers are 50%. Well, this is true in almost any part of your business, and we’ll get into that. But then there’s a third thing. And this is probably a little bit new to most people, but the world is really becoming much more 95-5 where 5% of your efforts or your customers produce 95% of your results, and the other 95% only produces 5%. And this is especially true online. I’ve been watching this develop. People really need to understand this. The world is not … Cause and effect in the world operate fundamentally different than they did even 15 years ago. And I don’t think most people have gotten the memo. There’s a lot of examples of this out there.

John Jantsch: Let me stop you there, because I want to clarify something. And we’ll get, obviously, into examples, and I want to go back to the nature comment.

Perry Marshall: Yes.

John Jantsch: But it’s the simple kind of no-brainer lesson, then, to say, “Look, 95%” or if we want to use 80-20, still, to not scare too many people, is 80% of what you’re doing a waste of your time almost? I mean, especially when you get 95-5. It’s like 95% of my effort is on 5%? Quit doing that?

Perry Marshall: Well, yeah or almost, okay? You’ll always find that there’s a bunch of those things that somebody’s gotta do. It might not be you. It shouldn’t be you, but it’s gotta be somebody. But for example, 80 to 95% of all businesses fail or most entrepreneurs, we have all these little projects that we get into, and the project is a miniature little business, truth be told. Even if we didn’t go form an LLC or something. But actually anywhere from four-fifths to nine-tenths of those really don’t produce anything at the end of the day. And what’s happening in the world is that there’s more and more people kind of getting nowhere or just treading water or altogether losing, and then there’s this minority of people that are just absolutely slamming the ball out of the park, like it’s a triple. It’s a home run and then some. There’s less and less that’s in the middle. And so I think people today have to be more ruthless about how they spend their time than they’ve ever been before. There’s never been a time when busy work would get you less far than it does right now.

John Jantsch: And there’s probably never been more busy work.

Perry Marshall: Oh my gah. Yeah. Like, amazing amounts of busy work, and it doesn’t even look like busy work on the surface. You have to be really discerning. Lots of things, they just sound like good ideas, and a lot of them are based on, well, it’s really what was working in 2003, and it’s not really based on what’s going on right now. So I am issuing a wake up call.

John Jantsch: So let me go back to the nature comment about the grains of sand on the beach or all the things you cited from nature. I mean, is there some sort of principle that suggests why that’s the case?

Perry Marshall: Yes. Yes, and I’m not gonna get super theoretical. I could go into all kinds of stuff about chaos theory. This is really what it’s based on. But, John, I just want you to imagine that we put a table in the middle of your living room, and we went to some machine shop, and we machined the top of that table to be absolutely flat to within 100,000th of an inch, and it was a mirror finish. But then I want you to imagine that there’s a leak in your roof, and now we’re gonna drip water on that table, and the water is gonna drip into the middle of the table. So here’s a question of, “If I have the table perfectly level, and it’s perfectly flat, does that mean that the water is going to evenly spread out on the table, and then drip off the edge of the table in a smooth-flowing stream?

John Jantsch: My guess is it would probably gather as much energy to spread itself out in a very small section of where it landed.

Perry Marshall: Well, right. Right. And what would happen is no matter how flat you try to make that table, it’s gonna be a little bit easier for the water to go in one direction than the other ones, and then it starts going. And once it starts going, well, the erosion will wear, and then a million years later, there’s gonna be this big giant groove in the middle of your table that started out as flat. There’s nothing you could do to make the water flow equally. And here’s the thing is everything in life and nature is like that. So how water erodes or, for example, you’ve 10 14-year-old kids yesterday tried Jack Daniels for the first time. And maybe they all sort of liked it. But one of them liked it a little more than the rest of them, and so 30 years from now the rest of them all take a drink a week or two drinks a week and one of them has five drinks before breakfast, and he’s an alcoholic.

Okay? So your customers are like that. And my customers are like that. Everything is unequal. And the thing is is education conditions treat everything like it’s equal, treat everybody like they’re equal. The teachers try to make all the kids equal. Well, I just want everybody to get A’s and B’s. It’s like, “Well, they’re not going to.” And so entrepreneurs harness the eccentricities where a lot of more ivory tower people, they kind of try to pretend they’re not there. And so you have to just completely reverse the normal way that you think.

John Jantsch: Okay. So for that person out there that’s thinking, “Where in the world is this going and why is this gonna apply to my business?” Let’s bring it back to something very practical inside a business. How could somebody start spotting that 95% opportunity?

Perry Marshall: Let me tell you a story, and maybe a couple of your people have heard this one before, but this is my favorite 80-20 story. I have a friend named John Paul [inaudible 00:10:15] who dropped out of high school when he was 17, and he hitchhiked from Denver to Las Vegas with a couple of gambling books under his arm, and he’s like, “I’m gonna become a professional gambler.” He starts going to casinos and playing poker every day and living by his whits at age 17. And after a few weeks of this he was like, “Dang. This is harder than I thought.” He bumps into this guy who runs a gambling ring named Rob, and he starts talking to him. And he says, “Well, could you teach me how to do this?” And Rob says, “For a percentage of your winnings I could teach you how to do this.” And so they shake on it.

And after they do that, “Hey, jump in the jeep, John. We’re going for a ride.” So they get in the car, and they’re going down the highway, and John says, “Okay. So how do I win more poker games?” And Rob goes, “You have to play people who are going to lose. And those people are called marks, and you need to find the marks in the room, and you need to play poker with them, and you don’t play poker with anybody else.” And he says, “Well, how do I find the marks?” And he says, “Here. I’ll show you.” And he pulls into a parking lot of a strip club, and they go in there. And there’s women and there’s rock and roll, and there’s people drinking and all this commotion and noise in there.

And he sits down at the table, and Rob pulls a sawed off shotgun out of his jacket. And he opens the chamber, and under the table, then he snaps it shut and it goes “chitch.” And all these guys look around. And John sees them. And the owner come over, and he says, “Hey, what’s going on over here?” And Rob goes, “Hey, we’re just fine. There’s no problem here. We’re just teaching the lad a lesson, not gonna cause any trouble. Don’t worry about us.” And then Rob turns to John and he says, “John, did you see those guys who turned around when I made that noise?” And he’s like, “Yeah. Those biker guys over there?” “Yeah, those guys.” And John goes, “Yeah.” And he says, “Don’t play poker with them. They’re not marks. Play poker with everybody else.”

Now, that was what I call racking the shotgun, and everything you do in marketing is rack the shotgun. In fact, I’ve trained my customers and clients to use that phrase all the time. Rack the shotgun is when you … You know who racks the shotgun all the time is Donald Trump, okay? Now, I’m not saying he does it for good reasons or whatever. I’m not making any statements about any of that, but he does it. Okay? And he gets a response. Now, what I have always found out is most people are instinctively afraid to rack the shotgun. They’re afraid to find out the truth. They’re afraid to go make that big noise out there and see, “Okay, who’s gonna turn their head and who’s gonna ignore?” Or, “Who’s gonna say no and who’s gonna say yes.”

I mean, it could even go all the way down to your teenager like, “Well, you know, I don’t want to … She came in at 2:30 in the morning last night, and I don’t really want to ruffle any feathers, and we seem to be getting” … Well, that’s like being afraid to rack the shotgun. Like, well, if you don’t know why your teenager came in at 2:30 in the morning, then whatever the reason is is probably not a good one, right? But you have to ask.

John Jantsch: Ignorance is bliss, right? Yeah.

Perry Marshall: I talked to a guy about … He owned a smoothie store, and he was doing all this Facebook and social media stuff, and I’d go, “Well, do you ever send them emails?” He goes, “No, I’m afraid of them unsubscribing.” Well, that’s racking the shotgun, man. I said, “Email is 10 times better than social media. You’re not emailing, because you’re afraid some people won’t like it? Send them an email. Let them unsubscribe. It’s fine.” In fact, if you’re unsubscribe rate is less than 5% or even 10, you’re probably not selling hard enough. So everything you do, everything you do in marketing is racking the shotgun.

John Jantsch: So what you’re, again, coming back to my original question on that, what you’re suggesting is that’s how you’re gonna find the leverage?

Perry Marshall: Yeah. With people, right, you’re gonna find that most people actually aren’t gonna respond to anything that you do. They’re never gonna buy, okay? And maybe it’s 80% aren’t gonna buy or maybe it’s 60% or maybe it’s 95% aren’t gonna buy. But there is a rack the shotgun just with buying. Now, the interesting part about 80-20 is that if you rack a shotgun, and you get, let’s call it $100 shotgun. It’s a $100 transaction, let’s say, and you get 100 people to respond. Well, if you quadruple the price, if you rack a $400 shotgun, 20% of those people will respond again. And if you rack a $1,600 shotgun, 20% of those people will respond again. If you rack a $6,400 shotgun, 20% of those people will respond again. And so you’ll find that even though you started with only 100 people, let’s say, who would spend $100, you might find one person who would spend $50,000. And you didn’t know it, and that person was already there. That person is already in your audience. And what I am seeing is that all of this is becoming more pronounced than it used to be.

John Jantsch: So it really, I mean, again, one of the sort of core principles was you build a business, you got customers. You need to be trying to sell them more. I mean, essentially you’re saying that, but maybe at a level people haven’t considered, that not just is there an opportunity to maybe sell more, but that there is a sort of almost mathematical equation that says what you should you sell them and how much it should cost and who’s gonna respond?

Perry Marshall: That’s right. There is a hunger in the marketplace that there’s a small percentage of people who they have an extreme itch that they would like to scratch. And it’s almost unscratchable. When it’s just your product line, there’s some other things I want to get into, but let’s just restrict it to your product line right now. So 80-20 says, “If I have a Starbucks, and a thousand a people a month are buying a $5 latte, one of those people will buy a $2,700 gleaming stainless steel espresso machine.” And it’s just about a law of physics. Now, I started to notice something really interesting when I started teaching Google AdWords. I wrote the world’s best selling books on Google and Facebook advertising, and all of a sudden when AdWords came into existence, all of these new businesses that might not have even been able to exist before suddenly popped up.

And it was this giant feeding frenzy and gold rush. And what I noticed was that if somebody could get to the top in AdWords, they could get the number one position, which gets the most traffic. And then if they could streamline all the stuff in their website, the shopping cart, the sales pages, the landing pages, the offer, the unique selling proposition, if they could dial all that in and test it to the hilt, they would get to a point where nobody could shove them out of the way. They’re number one, they might be number on TV, and they might not be number one on the radio, and they might not be number one on main street, but if they’re number one in Google AdWords, and if they got their sales machine dialed in, they’re almost unstoppable.

Now, here’s why this was. It was because number two, number three, number four, number five, they all have to test their way to success, and they have to experimentally find what works, but you’re already getting more traffic than they are, and you can already do more tests than they are. And so you’re previous success greases the skids for you to continue to be successful, because you’re the incumbent. Well, I’ve been watching very carefully, and what I’ve seen is that an incumbent in the brick and mortar world is 80-20, but an incumbent in the digital world is 95-5. So here’s an example of this. You could go ask your 10-year-old kid, “Can you name a dozen car manufacturers?” And any 10-year-old kid could think of a dozen, Ferrari and Toyota and Kia. They could come up with a list. But can anybody name 12 search engines or 12 auction sites or 12 bookstores where you can buy any book?

John Jantsch: Well, I don’t know about you, but I have the top 100 search engines that every business should be in sitting right here next to me. I’m being facetious, of course, but remember when people used to talk about that.

Perry Marshall: Right. Right. And they all got washed out. Well, that’s because the internet is frictionless. So making cars, that’s friction all the way. Whether you go to the Toyota dealership or the Ford dealership, you have to drive across town, right? Okay. And so that supports there being 12 different car manufacturers. But if it’s Bing versus Google, there’s literally no difference whether you type in B-I-N-G or G-O-O-G-L-E on your browser. The only thing that makes a difference is how much you enjoy the experience. If Google is 10% better, then pretty soon everybody’s gonna use Google, and the Google’s gonna become 1,000% better, because they have more data and more customers and more bells and whistles and more everything. And pretty soon Bing doesn’t really have a chance.

And, see, everything in online marketing is like this. Basically, you’re either number one or you’re nobody. And I don’t think most people have really gotten this that this has happened. You’re either number one or you’re nothing. So that old phrase being a category of one, oh, it’s dead serious no. In a 95-5 world you have to be the number one. Whatever you do, you have to be the only one or you are hamburger.

John Jantsch: I think you can see that at a very real level for the local plumber, for example. I mean, all the searches are being done on a mobile device, and Google is determining, “Here’s the three positions that they’re gonna show.” And certainly if you don’t show up in those three, and as you suggest maybe number one of those three, you really don’t exist, I think. And so the digital world is even cutting into the world of friction.

Perry Marshall: It is.

John Jantsch: We may see a day when there’s only one car sale search engine, and the manufacturers are really, I think, playing basically to be there.

Perry Marshall: So I’ll make a prediction right now is that 10 years from now self-driving cars will be extremely common, and half of the auto manufacturers will either be out of business or bought out by the winners.

John Jantsch: Yeah. Yeah, because to some extent the brand won’t matter anymore.

Perry Marshall: No. It won’t. So watch out. Now, if you know this, if you know this, you can make predictions about the future. In many cases if you project 10 years in the future, if you are already pretty much know who the winner is, then you can bet on the winner, and you’ll gain. If there’s somebody out there … I don’t know. I don’t know who it might be, but if somebody out there already pretty much knows who’s gonna control the self-driving car thing, then you buy stock in that company. In 10 years from now you’ll be happy about it, because there probably isn’t that much that anybody can do even right now to change it. To give you another idea, there’s Bitcoin and there’s Ethereum, and there’s all these other little cryptocurrencies. Bitcoin already won. All the rest of them, that’s like .net, .cc, .name, .whatever. It’s just like domain names. They’ll have their little day in the sun and people will think. Bitcoin’s already won. It’s the winner-take-all phenomenon is on steroids.

John Jantsch:  I’m trying to figure out which direction to take this, because there’s so many we can go, and we’re really already out of time. So let me ask you how somebody would … And I’m trying to, again, end it on a really practical note. How would somebody apply this to an existing business? I can see a lot of people thinking, “Okay. If I could figure out this thing and predict the future, and I’ll create a business around that.” But how could somebody apply this? I mean, is this something that you have to have an epiphany? Or is this something that you have to just go out and start testing things in a certain way?

Perry Marshall: So here’s what you can do, and this is extremely practical. Richard [inaudible 00:26:29] and I put together this website called StarPrinciple.com. It’s free, and you can go click a dozen radio buttons and score your business. Basically it tells you how likely it is that you can dominate the niche that you’re in right now. It’s kind of a truth serum of this winner-take-all thing. So the score goes from zero to 200 points, and anything over 100 points is a home run. Okay? Now, some businesses will get a 25, and some will get a 75, and some will get 150. If you’re 150, man, you’re good, and you should pour on the gas. Well, so here’s what you do. Most of our businesses are really three or four businesses or three or four product lines or three or four markets, and they’re all kind of one umbrella. Here’s what you need to do. This could save somebody years of heartache and frustration right here. Okay?

You go, “All right. Well, I have product A, B, C, D. I have market A, B, C, D.” You score each one individually, because in one of your markets you’re really the number six player. In one of your markets you’re the number one player. One market is shrinking, and one market is growing. And you score that. And you break it up, and you need to figure out which part of my business do I pour the gas on and which part do I really just kind of ignore or I let coast? Right? Just give it as little gas I can get away with while I build the others, because 20% of your business is gonna produce 80% of the growth in the future, and the rest of it’s just gonna waste your time.

I think a lot of us aren’t really honest with ourselves about where our business is actually at and what it can really produce, and you need to be the winner. There is probably some part of your market where if you’re like, “Well, this part of the market isn’t very well served right now. Nobody else is really truly paying attention to this aspect, and I could totally nail it. And if I really put my resources into it, I could emerge as the absolute dominant player within six or 12 months,” and that’s what you should do.

John Jantsch: Visiting with Perry Marshal. We’re talking about the 80-20 principle, which is now 95-5 online. Winner take all is the game that we’re playing. Perry, thanks so much for joining us. Where can people find probably the best place to plug in to your, kind of, vast universe?

Perry Marshall: You can go to http://ift.tt/1TMHaKs. And just start by reading 80-20 in sales and marketing and just know that it’s even more true now than it was in 2013 when I wrote it. And the race is on. The race is on. It’s winner take it all, and whatever it is that you do, you need to find the thing where you can be number one, and you can totally dominate and be a category of one, because all..

http://ift.tt/2iF42kB

#Transcript of Unlocking the Power of 80/20

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Transcript of Unlocking the Power of 80/20

Transcript of Unlocking the Power of 80/20

Transcript of Unlocking the Power of 80/20 written by John Jantsch read more at Duct Tape Marketing

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John Jantsch: Hello and welcome to another episode of the Duct Tape Marketing Podcast. This is your host, John Jantsch, and my guest today is Perry Marshall. He’s an online marketing strategist, entrepreneur, and author of numerous books, including one we’re gonna talk about today, the 80-20 of sales and marketing. So, Perry, thanks for joining me.

Perry Marshall: John, it’s great to be here. It was great to be at your summit a couple of years ago where I met a lot of your people. The world just seems to be getting more and more eccentric, and there’s a lot for us to talk about today. Man, you’re either harnessing the eccentricity, or it’s pounding you on the back of the head with a two by four. And there’s not much in the middle, so very timely.

John Jantsch: Let’s get kind of a baseline. I mean, everybody’s heard the 80-20 thing. It’s almost become cliché how people apply it. But I don’t know that that many people, and this is your contention with the book, that many people get the leverage that it provides at a business level, do they?

Perry Marshall: No. First off, it’s not just a business rule of thumb. It’s a fact of nature. And, in fact, if I go to the beach with a bucket, and I pull out a bucket of sand, the sizes of the sand grains is gonna be 80-20. And how much water is in all the rivers is 80-20. The dirt on your carpet is 80-20, and the files in your hard drive. Okay? That’s the first thing. The second thing is that there’s an 80-20 inside every 80-20. When people really get this, it kind of flips them out. And so I can run a spreadsheet or a sales report of all my customers, and if I sort it from top to bottom, 20% of my customers are gonna generate 80% of the sales, but then if I chop off the bottom 80% that only produces 20%, whatever’s left, that top 20%, it’s still 80-20.

And I can do that again. And 4% of my customers are 64% of my business. And then I could do it again, and 1% of the customers are 50%. Well, this is true in almost any part of your business, and we’ll get into that. But then there’s a third thing. And this is probably a little bit new to most people, but the world is really becoming much more 95-5 where 5% of your efforts or your customers produce 95% of your results, and the other 95% only produces 5%. And this is especially true online. I’ve been watching this develop. People really need to understand this. The world is not … Cause and effect in the world operate fundamentally different than they did even 15 years ago. And I don’t think most people have gotten the memo. There’s a lot of examples of this out there.

John Jantsch: Let me stop you there, because I want to clarify something. And we’ll get, obviously, into examples, and I want to go back to the nature comment.

Perry Marshall: Yes.

John Jantsch: But it’s the simple kind of no-brainer lesson, then, to say, “Look, 95%” or if we want to use 80-20, still, to not scare too many people, is 80% of what you’re doing a waste of your time almost? I mean, especially when you get 95-5. It’s like 95% of my effort is on 5%? Quit doing that?

Perry Marshall: Well, yeah or almost, okay? You’ll always find that there’s a bunch of those things that somebody’s gotta do. It might not be you. It shouldn’t be you, but it’s gotta be somebody. But for example, 80 to 95% of all businesses fail or most entrepreneurs, we have all these little projects that we get into, and the project is a miniature little business, truth be told. Even if we didn’t go form an LLC or something. But actually anywhere from four-fifths to nine-tenths of those really don’t produce anything at the end of the day. And what’s happening in the world is that there’s more and more people kind of getting nowhere or just treading water or altogether losing, and then there’s this minority of people that are just absolutely slamming the ball out of the park, like it’s a triple. It’s a home run and then some. There’s less and less that’s in the middle. And so I think people today have to be more ruthless about how they spend their time than they’ve ever been before. There’s never been a time when busy work would get you less far than it does right now.

John Jantsch: And there’s probably never been more busy work.

Perry Marshall: Oh my gah. Yeah. Like, amazing amounts of busy work, and it doesn’t even look like busy work on the surface. You have to be really discerning. Lots of things, they just sound like good ideas, and a lot of them are based on, well, it’s really what was working in 2003, and it’s not really based on what’s going on right now. So I am issuing a wake up call.

John Jantsch: So let me go back to the nature comment about the grains of sand on the beach or all the things you cited from nature. I mean, is there some sort of principle that suggests why that’s the case?

Perry Marshall: Yes. Yes, and I’m not gonna get super theoretical. I could go into all kinds of stuff about chaos theory. This is really what it’s based on. But, John, I just want you to imagine that we put a table in the middle of your living room, and we went to some machine shop, and we machined the top of that table to be absolutely flat to within 100,000th of an inch, and it was a mirror finish. But then I want you to imagine that there’s a leak in your roof, and now we’re gonna drip water on that table, and the water is gonna drip into the middle of the table. So here’s a question of, “If I have the table perfectly level, and it’s perfectly flat, does that mean that the water is going to evenly spread out on the table, and then drip off the edge of the table in a smooth-flowing stream?

John Jantsch: My guess is it would probably gather as much energy to spread itself out in a very small section of where it landed.

Perry Marshall: Well, right. Right. And what would happen is no matter how flat you try to make that table, it’s gonna be a little bit easier for the water to go in one direction than the other ones, and then it starts going. And once it starts going, well, the erosion will wear, and then a million years later, there’s gonna be this big giant groove in the middle of your table that started out as flat. There’s nothing you could do to make the water flow equally. And here’s the thing is everything in life and nature is like that. So how water erodes or, for example, you’ve 10 14-year-old kids yesterday tried Jack Daniels for the first time. And maybe they all sort of liked it. But one of them liked it a little more than the rest of them, and so 30 years from now the rest of them all take a drink a week or two drinks a week and one of them has five drinks before breakfast, and he’s an alcoholic.

Okay? So your customers are like that. And my customers are like that. Everything is unequal. And the thing is is education conditions treat everything like it’s equal, treat everybody like they’re equal. The teachers try to make all the kids equal. Well, I just want everybody to get A’s and B’s. It’s like, “Well, they’re not going to.” And so entrepreneurs harness the eccentricities where a lot of more ivory tower people, they kind of try to pretend they’re not there. And so you have to just completely reverse the normal way that you think.

John Jantsch: Okay. So for that person out there that’s thinking, “Where in the world is this going and why is this gonna apply to my business?” Let’s bring it back to something very practical inside a business. How could somebody start spotting that 95% opportunity?

Perry Marshall: Let me tell you a story, and maybe a couple of your people have heard this one before, but this is my favorite 80-20 story. I have a friend named John Paul [inaudible 00:10:15] who dropped out of high school when he was 17, and he hitchhiked from Denver to Las Vegas with a couple of gambling books under his arm, and he’s like, “I’m gonna become a professional gambler.” He starts going to casinos and playing poker every day and living by his whits at age 17. And after a few weeks of this he was like, “Dang. This is harder than I thought.” He bumps into this guy who runs a gambling ring named Rob, and he starts talking to him. And he says, “Well, could you teach me how to do this?” And Rob says, “For a percentage of your winnings I could teach you how to do this.” And so they shake on it.

And after they do that, “Hey, jump in the jeep, John. We’re going for a ride.” So they get in the car, and they’re going down the highway, and John says, “Okay. So how do I win more poker games?” And Rob goes, “You have to play people who are going to lose. And those people are called marks, and you need to find the marks in the room, and you need to play poker with them, and you don’t play poker with anybody else.” And he says, “Well, how do I find the marks?” And he says, “Here. I’ll show you.” And he pulls into a parking lot of a strip club, and they go in there. And there’s women and there’s rock and roll, and there’s people drinking and all this commotion and noise in there.

And he sits down at the table, and Rob pulls a sawed off shotgun out of his jacket. And he opens the chamber, and under the table, then he snaps it shut and it goes “chitch.” And all these guys look around. And John sees them. And the owner come over, and he says, “Hey, what’s going on over here?” And Rob goes, “Hey, we’re just fine. There’s no problem here. We’re just teaching the lad a lesson, not gonna cause any trouble. Don’t worry about us.” And then Rob turns to John and he says, “John, did you see those guys who turned around when I made that noise?” And he’s like, “Yeah. Those biker guys over there?” “Yeah, those guys.” And John goes, “Yeah.” And he says, “Don’t play poker with them. They’re not marks. Play poker with everybody else.”

Now, that was what I call racking the shotgun, and everything you do in marketing is rack the shotgun. In fact, I’ve trained my customers and clients to use that phrase all the time. Rack the shotgun is when you … You know who racks the shotgun all the time is Donald Trump, okay? Now, I’m not saying he does it for good reasons or whatever. I’m not making any statements about any of that, but he does it. Okay? And he gets a response. Now, what I have always found out is most people are instinctively afraid to rack the shotgun. They’re afraid to find out the truth. They’re afraid to go make that big noise out there and see, “Okay, who’s gonna turn their head and who’s gonna ignore?” Or, “Who’s gonna say no and who’s gonna say yes.”

I mean, it could even go all the way down to your teenager like, “Well, you know, I don’t want to … She came in at 2:30 in the morning last night, and I don’t really want to ruffle any feathers, and we seem to be getting” … Well, that’s like being afraid to rack the shotgun. Like, well, if you don’t know why your teenager came in at 2:30 in the morning, then whatever the reason is is probably not a good one, right? But you have to ask.

John Jantsch: Ignorance is bliss, right? Yeah.

Perry Marshall: I talked to a guy about … He owned a smoothie store, and he was doing all this Facebook and social media stuff, and I’d go, “Well, do you ever send them emails?” He goes, “No, I’m afraid of them unsubscribing.” Well, that’s racking the shotgun, man. I said, “Email is 10 times better than social media. You’re not emailing, because you’re afraid some people won’t like it? Send them an email. Let them unsubscribe. It’s fine.” In fact, if you’re unsubscribe rate is less than 5% or even 10, you’re probably not selling hard enough. So everything you do, everything you do in marketing is racking the shotgun.

John Jantsch: So what you’re, again, coming back to my original question on that, what you’re suggesting is that’s how you’re gonna find the leverage?

Perry Marshall: Yeah. With people, right, you’re gonna find that most people actually aren’t gonna respond to anything that you do. They’re never gonna buy, okay? And maybe it’s 80% aren’t gonna buy or maybe it’s 60% or maybe it’s 95% aren’t gonna buy. But there is a rack the shotgun just with buying. Now, the interesting part about 80-20 is that if you rack a shotgun, and you get, let’s call it $100 shotgun. It’s a $100 transaction, let’s say, and you get 100 people to respond. Well, if you quadruple the price, if you rack a $400 shotgun, 20% of those people will respond again. And if you rack a $1,600 shotgun, 20% of those people will respond again. If you rack a $6,400 shotgun, 20% of those people will respond again. And so you’ll find that even though you started with only 100 people, let’s say, who would spend $100, you might find one person who would spend $50,000. And you didn’t know it, and that person was already there. That person is already in your audience. And what I am seeing is that all of this is becoming more pronounced than it used to be.

John Jantsch: So it really, I mean, again, one of the sort of core principles was you build a business, you got customers. You need to be trying to sell them more. I mean, essentially you’re saying that, but maybe at a level people haven’t considered, that not just is there an opportunity to maybe sell more, but that there is a sort of almost mathematical equation that says what you should you sell them and how much it should cost and who’s gonna respond?

Perry Marshall: That’s right. There is a hunger in the marketplace that there’s a small percentage of people who they have an extreme itch that they would like to scratch. And it’s almost unscratchable. When it’s just your product line, there’s some other things I want to get into, but let’s just restrict it to your product line right now. So 80-20 says, “If I have a Starbucks, and a thousand a people a month are buying a $5 latte, one of those people will buy a $2,700 gleaming stainless steel espresso machine.” And it’s just about a law of physics. Now, I started to notice something really interesting when I started teaching Google AdWords. I wrote the world’s best selling books on Google and Facebook advertising, and all of a sudden when AdWords came into existence, all of these new businesses that might not have even been able to exist before suddenly popped up.

And it was this giant feeding frenzy and gold rush. And what I noticed was that if somebody could get to the top in AdWords, they could get the number one position, which gets the most traffic. And then if they could streamline all the stuff in their website, the shopping cart, the sales pages, the landing pages, the offer, the unique selling proposition, if they could dial all that in and test it to the hilt, they would get to a point where nobody could shove them out of the way. They’re number one, they might be number on TV, and they might not be number one on the radio, and they might not be number one on main street, but if they’re number one in Google AdWords, and if they got their sales machine dialed in, they’re almost unstoppable.

Now, here’s why this was. It was because number two, number three, number four, number five, they all have to test their way to success, and they have to experimentally find what works, but you’re already getting more traffic than they are, and you can already do more tests than they are. And so you’re previous success greases the skids for you to continue to be successful, because you’re the incumbent. Well, I’ve been watching very carefully, and what I’ve seen is that an incumbent in the brick and mortar world is 80-20, but an incumbent in the digital world is 95-5. So here’s an example of this. You could go ask your 10-year-old kid, “Can you name a dozen car manufacturers?” And any 10-year-old kid could think of a dozen, Ferrari and Toyota and Kia. They could come up with a list. But can anybody name 12 search engines or 12 auction sites or 12 bookstores where you can buy any book?

John Jantsch: Well, I don’t know about you, but I have the top 100 search engines that every business should be in sitting right here next to me. I’m being facetious, of course, but remember when people used to talk about that.

Perry Marshall: Right. Right. And they all got washed out. Well, that’s because the internet is frictionless. So making cars, that’s friction all the way. Whether you go to the Toyota dealership or the Ford dealership, you have to drive across town, right? Okay. And so that supports there being 12 different car manufacturers. But if it’s Bing versus Google, there’s literally no difference whether you type in B-I-N-G or G-O-O-G-L-E on your browser. The only thing that makes a difference is how much you enjoy the experience. If Google is 10% better, then pretty soon everybody’s gonna use Google, and the Google’s gonna become 1,000% better, because they have more data and more customers and more bells and whistles and more everything. And pretty soon Bing doesn’t really have a chance.

And, see, everything in online marketing is like this. Basically, you’re either number one or you’re nobody. And I don’t think most people have really gotten this that this has happened. You’re either number one or you’re nothing. So that old phrase being a category of one, oh, it’s dead serious no. In a 95-5 world you have to be the number one. Whatever you do, you have to be the only one or you are hamburger.

John Jantsch: I think you can see that at a very real level for the local plumber, for example. I mean, all the searches are being done on a mobile device, and Google is determining, “Here’s the three positions that they’re gonna show.” And certainly if you don’t show up in those three, and as you suggest maybe number one of those three, you really don’t exist, I think. And so the digital world is even cutting into the world of friction.

Perry Marshall: It is.

John Jantsch: We may see a day when there’s only one car sale search engine, and the manufacturers are really, I think, playing basically to be there.

Perry Marshall: So I’ll make a prediction right now is that 10 years from now self-driving cars will be extremely common, and half of the auto manufacturers will either be out of business or bought out by the winners.

John Jantsch: Yeah. Yeah, because to some extent the brand won’t matter anymore.

Perry Marshall: No. It won’t. So watch out. Now, if you know this, if you know this, you can make predictions about the future. In many cases if you project 10 years in the future, if you are already pretty much know who the winner is, then you can bet on the winner, and you’ll gain. If there’s somebody out there … I don’t know. I don’t know who it might be, but if somebody out there already pretty much knows who’s gonna control the self-driving car thing, then you buy stock in that company. In 10 years from now you’ll be happy about it, because there probably isn’t that much that anybody can do even right now to change it. To give you another idea, there’s Bitcoin and there’s Ethereum, and there’s all these other little cryptocurrencies. Bitcoin already won. All the rest of them, that’s like .net, .cc, .name, .whatever. It’s just like domain names. They’ll have their little day in the sun and people will think. Bitcoin’s already won. It’s the winner-take-all phenomenon is on steroids.

John Jantsch:  I’m trying to figure out which direction to take this, because there’s so many we can go, and we’re really already out of time. So let me ask you how somebody would … And I’m trying to, again, end it on a really practical note. How would somebody apply this to an existing business? I can see a lot of people thinking, “Okay. If I could figure out this thing and predict the future, and I’ll create a business around that.” But how could somebody apply this? I mean, is this something that you have to have an epiphany? Or is this something that you have to just go out and start testing things in a certain way?

Perry Marshall: So here’s what you can do, and this is extremely practical. Richard [inaudible 00:26:29] and I put together this website called StarPrinciple.com. It’s free, and you can go click a dozen radio buttons and score your business. Basically it tells you how likely it is that you can dominate the niche that you’re in right now. It’s kind of a truth serum of this winner-take-all thing. So the score goes from zero to 200 points, and anything over 100 points is a home run. Okay? Now, some businesses will get a 25, and some will get a 75, and some will get 150. If you’re 150, man, you’re good, and you should pour on the gas. Well, so here’s what you do. Most of our businesses are really three or four businesses or three or four product lines or three or four markets, and they’re all kind of one umbrella. Here’s what you need to do. This could save somebody years of heartache and frustration right here. Okay?

You go, “All right. Well, I have product A, B, C, D. I have market A, B, C, D.” You score each one individually, because in one of your markets you’re really the number six player. In one of your markets you’re the number one player. One market is shrinking, and one market is growing. And you score that. And you break it up, and you need to figure out which part of my business do I pour the gas on and which part do I really just kind of ignore or I let coast? Right? Just give it as little gas I can get away with while I build the others, because 20% of your business is gonna produce 80% of the growth in the future, and the rest of it’s just gonna waste your time.

I think a lot of us aren’t really honest with ourselves about where our business is actually at and what it can really produce, and you need to be the winner. There is probably some part of your market where if you’re like, “Well, this part of the market isn’t very well served right now. Nobody else is really truly paying attention to this aspect, and I could totally nail it. And if I really put my resources into it, I could emerge as the absolute dominant player within six or 12 months,” and that’s what you should do.

John Jantsch: Visiting with Perry Marshal. We’re talking about the 80-20 principle, which is now 95-5 online. Winner take all is the game that we’re playing. Perry, thanks so much for joining us. Where can people find probably the best place to plug in to your, kind of, vast universe?

Perry Marshall: You can go to http://ift.tt/1TMHaKs. And just start by reading 80-20 in sales and marketing and just know that it’s even more true now than it was in 2013 when I wrote it. And the race is on. The race is on. It’s winner take it all, and whatever it is that you do, you need to find the thing where you can be number one, and you can totally dominate and be a category of one, because all..

http://ift.tt/2iF42kB

#Transcript of Unlocking the Power of 80/20

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Transcript of Unlocking the Power of 80/20

Transcript of Unlocking the Power of 80/20

Transcript of Unlocking the Power of 80/20 written by John Jantsch read more at Duct Tape Marketing

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John Jantsch: Hello and welcome to another episode of the Duct Tape Marketing Podcast. This is your host, John Jantsch, and my guest today is Perry Marshall. He’s an online marketing strategist, entrepreneur, and author of numerous books, including one we’re gonna talk about today, the 80-20 of sales and marketing. So, Perry, thanks for joining me.

Perry Marshall: John, it’s great to be here. It was great to be at your summit a couple of years ago where I met a lot of your people. The world just seems to be getting more and more eccentric, and there’s a lot for us to talk about today. Man, you’re either harnessing the eccentricity, or it’s pounding you on the back of the head with a two by four. And there’s not much in the middle, so very timely.

John Jantsch: Let’s get kind of a baseline. I mean, everybody’s heard the 80-20 thing. It’s almost become cliché how people apply it. But I don’t know that that many people, and this is your contention with the book, that many people get the leverage that it provides at a business level, do they?

Perry Marshall: No. First off, it’s not just a business rule of thumb. It’s a fact of nature. And, in fact, if I go to the beach with a bucket, and I pull out a bucket of sand, the sizes of the sand grains is gonna be 80-20. And how much water is in all the rivers is 80-20. The dirt on your carpet is 80-20, and the files in your hard drive. Okay? That’s the first thing. The second thing is that there’s an 80-20 inside every 80-20. When people really get this, it kind of flips them out. And so I can run a spreadsheet or a sales report of all my customers, and if I sort it from top to bottom, 20% of my customers are gonna generate 80% of the sales, but then if I chop off the bottom 80% that only produces 20%, whatever’s left, that top 20%, it’s still 80-20.

And I can do that again. And 4% of my customers are 64% of my business. And then I could do it again, and 1% of the customers are 50%. Well, this is true in almost any part of your business, and we’ll get into that. But then there’s a third thing. And this is probably a little bit new to most people, but the world is really becoming much more 95-5 where 5% of your efforts or your customers produce 95% of your results, and the other 95% only produces 5%. And this is especially true online. I’ve been watching this develop. People really need to understand this. The world is not … Cause and effect in the world operate fundamentally different than they did even 15 years ago. And I don’t think most people have gotten the memo. There’s a lot of examples of this out there.

John Jantsch: Let me stop you there, because I want to clarify something. And we’ll get, obviously, into examples, and I want to go back to the nature comment.

Perry Marshall: Yes.

John Jantsch: But it’s the simple kind of no-brainer lesson, then, to say, “Look, 95%” or if we want to use 80-20, still, to not scare too many people, is 80% of what you’re doing a waste of your time almost? I mean, especially when you get 95-5. It’s like 95% of my effort is on 5%? Quit doing that?

Perry Marshall: Well, yeah or almost, okay? You’ll always find that there’s a bunch of those things that somebody’s gotta do. It might not be you. It shouldn’t be you, but it’s gotta be somebody. But for example, 80 to 95% of all businesses fail or most entrepreneurs, we have all these little projects that we get into, and the project is a miniature little business, truth be told. Even if we didn’t go form an LLC or something. But actually anywhere from four-fifths to nine-tenths of those really don’t produce anything at the end of the day. And what’s happening in the world is that there’s more and more people kind of getting nowhere or just treading water or altogether losing, and then there’s this minority of people that are just absolutely slamming the ball out of the park, like it’s a triple. It’s a home run and then some. There’s less and less that’s in the middle. And so I think people today have to be more ruthless about how they spend their time than they’ve ever been before. There’s never been a time when busy work would get you less far than it does right now.

John Jantsch: And there’s probably never been more busy work.

Perry Marshall: Oh my gah. Yeah. Like, amazing amounts of busy work, and it doesn’t even look like busy work on the surface. You have to be really discerning. Lots of things, they just sound like good ideas, and a lot of them are based on, well, it’s really what was working in 2003, and it’s not really based on what’s going on right now. So I am issuing a wake up call.

John Jantsch: So let me go back to the nature comment about the grains of sand on the beach or all the things you cited from nature. I mean, is there some sort of principle that suggests why that’s the case?

Perry Marshall: Yes. Yes, and I’m not gonna get super theoretical. I could go into all kinds of stuff about chaos theory. This is really what it’s based on. But, John, I just want you to imagine that we put a table in the middle of your living room, and we went to some machine shop, and we machined the top of that table to be absolutely flat to within 100,000th of an inch, and it was a mirror finish. But then I want you to imagine that there’s a leak in your roof, and now we’re gonna drip water on that table, and the water is gonna drip into the middle of the table. So here’s a question of, “If I have the table perfectly level, and it’s perfectly flat, does that mean that the water is going to evenly spread out on the table, and then drip off the edge of the table in a smooth-flowing stream?

John Jantsch: My guess is it would probably gather as much energy to spread itself out in a very small section of where it landed.

Perry Marshall: Well, right. Right. And what would happen is no matter how flat you try to make that table, it’s gonna be a little bit easier for the water to go in one direction than the other ones, and then it starts going. And once it starts going, well, the erosion will wear, and then a million years later, there’s gonna be this big giant groove in the middle of your table that started out as flat. There’s nothing you could do to make the water flow equally. And here’s the thing is everything in life and nature is like that. So how water erodes or, for example, you’ve 10 14-year-old kids yesterday tried Jack Daniels for the first time. And maybe they all sort of liked it. But one of them liked it a little more than the rest of them, and so 30 years from now the rest of them all take a drink a week or two drinks a week and one of them has five drinks before breakfast, and he’s an alcoholic.

Okay? So your customers are like that. And my customers are like that. Everything is unequal. And the thing is is education conditions treat everything like it’s equal, treat everybody like they’re equal. The teachers try to make all the kids equal. Well, I just want everybody to get A’s and B’s. It’s like, “Well, they’re not going to.” And so entrepreneurs harness the eccentricities where a lot of more ivory tower people, they kind of try to pretend they’re not there. And so you have to just completely reverse the normal way that you think.

John Jantsch: Okay. So for that person out there that’s thinking, “Where in the world is this going and why is this gonna apply to my business?” Let’s bring it back to something very practical inside a business. How could somebody start spotting that 95% opportunity?

Perry Marshall: Let me tell you a story, and maybe a couple of your people have heard this one before, but this is my favorite 80-20 story. I have a friend named John Paul [inaudible 00:10:15] who dropped out of high school when he was 17, and he hitchhiked from Denver to Las Vegas with a couple of gambling books under his arm, and he’s like, “I’m gonna become a professional gambler.” He starts going to casinos and playing poker every day and living by his whits at age 17. And after a few weeks of this he was like, “Dang. This is harder than I thought.” He bumps into this guy who runs a gambling ring named Rob, and he starts talking to him. And he says, “Well, could you teach me how to do this?” And Rob says, “For a percentage of your winnings I could teach you how to do this.” And so they shake on it.

And after they do that, “Hey, jump in the jeep, John. We’re going for a ride.” So they get in the car, and they’re going down the highway, and John says, “Okay. So how do I win more poker games?” And Rob goes, “You have to play people who are going to lose. And those people are called marks, and you need to find the marks in the room, and you need to play poker with them, and you don’t play poker with anybody else.” And he says, “Well, how do I find the marks?” And he says, “Here. I’ll show you.” And he pulls into a parking lot of a strip club, and they go in there. And there’s women and there’s rock and roll, and there’s people drinking and all this commotion and noise in there.

And he sits down at the table, and Rob pulls a sawed off shotgun out of his jacket. And he opens the chamber, and under the table, then he snaps it shut and it goes “chitch.” And all these guys look around. And John sees them. And the owner come over, and he says, “Hey, what’s going on over here?” And Rob goes, “Hey, we’re just fine. There’s no problem here. We’re just teaching the lad a lesson, not gonna cause any trouble. Don’t worry about us.” And then Rob turns to John and he says, “John, did you see those guys who turned around when I made that noise?” And he’s like, “Yeah. Those biker guys over there?” “Yeah, those guys.” And John goes, “Yeah.” And he says, “Don’t play poker with them. They’re not marks. Play poker with everybody else.”

Now, that was what I call racking the shotgun, and everything you do in marketing is rack the shotgun. In fact, I’ve trained my customers and clients to use that phrase all the time. Rack the shotgun is when you … You know who racks the shotgun all the time is Donald Trump, okay? Now, I’m not saying he does it for good reasons or whatever. I’m not making any statements about any of that, but he does it. Okay? And he gets a response. Now, what I have always found out is most people are instinctively afraid to rack the shotgun. They’re afraid to find out the truth. They’re afraid to go make that big noise out there and see, “Okay, who’s gonna turn their head and who’s gonna ignore?” Or, “Who’s gonna say no and who’s gonna say yes.”

I mean, it could even go all the way down to your teenager like, “Well, you know, I don’t want to … She came in at 2:30 in the morning last night, and I don’t really want to ruffle any feathers, and we seem to be getting” … Well, that’s like being afraid to rack the shotgun. Like, well, if you don’t know why your teenager came in at 2:30 in the morning, then whatever the reason is is probably not a good one, right? But you have to ask.

John Jantsch: Ignorance is bliss, right? Yeah.

Perry Marshall: I talked to a guy about … He owned a smoothie store, and he was doing all this Facebook and social media stuff, and I’d go, “Well, do you ever send them emails?” He goes, “No, I’m afraid of them unsubscribing.” Well, that’s racking the shotgun, man. I said, “Email is 10 times better than social media. You’re not emailing, because you’re afraid some people won’t like it? Send them an email. Let them unsubscribe. It’s fine.” In fact, if you’re unsubscribe rate is less than 5% or even 10, you’re probably not selling hard enough. So everything you do, everything you do in marketing is racking the shotgun.

John Jantsch: So what you’re, again, coming back to my original question on that, what you’re suggesting is that’s how you’re gonna find the leverage?

Perry Marshall: Yeah. With people, right, you’re gonna find that most people actually aren’t gonna respond to anything that you do. They’re never gonna buy, okay? And maybe it’s 80% aren’t gonna buy or maybe it’s 60% or maybe it’s 95% aren’t gonna buy. But there is a rack the shotgun just with buying. Now, the interesting part about 80-20 is that if you rack a shotgun, and you get, let’s call it $100 shotgun. It’s a $100 transaction, let’s say, and you get 100 people to respond. Well, if you quadruple the price, if you rack a $400 shotgun, 20% of those people will respond again. And if you rack a $1,600 shotgun, 20% of those people will respond again. If you rack a $6,400 shotgun, 20% of those people will respond again. And so you’ll find that even though you started with only 100 people, let’s say, who would spend $100, you might find one person who would spend $50,000. And you didn’t know it, and that person was already there. That person is already in your audience. And what I am seeing is that all of this is becoming more pronounced than it used to be.

John Jantsch: So it really, I mean, again, one of the sort of core principles was you build a business, you got customers. You need to be trying to sell them more. I mean, essentially you’re saying that, but maybe at a level people haven’t considered, that not just is there an opportunity to maybe sell more, but that there is a sort of almost mathematical equation that says what you should you sell them and how much it should cost and who’s gonna respond?

Perry Marshall: That’s right. There is a hunger in the marketplace that there’s a small percentage of people who they have an extreme itch that they would like to scratch. And it’s almost unscratchable. When it’s just your product line, there’s some other things I want to get into, but let’s just restrict it to your product line right now. So 80-20 says, “If I have a Starbucks, and a thousand a people a month are buying a $5 latte, one of those people will buy a $2,700 gleaming stainless steel espresso machine.” And it’s just about a law of physics. Now, I started to notice something really interesting when I started teaching Google AdWords. I wrote the world’s best selling books on Google and Facebook advertising, and all of a sudden when AdWords came into existence, all of these new businesses that might not have even been able to exist before suddenly popped up.

And it was this giant feeding frenzy and gold rush. And what I noticed was that if somebody could get to the top in AdWords, they could get the number one position, which gets the most traffic. And then if they could streamline all the stuff in their website, the shopping cart, the sales pages, the landing pages, the offer, the unique selling proposition, if they could dial all that in and test it to the hilt, they would get to a point where nobody could shove them out of the way. They’re number one, they might be number on TV, and they might not be number one on the radio, and they might not be number one on main street, but if they’re number one in Google AdWords, and if they got their sales machine dialed in, they’re almost unstoppable.

Now, here’s why this was. It was because number two, number three, number four, number five, they all have to test their way to success, and they have to experimentally find what works, but you’re already getting more traffic than they are, and you can already do more tests than they are. And so you’re previous success greases the skids for you to continue to be successful, because you’re the incumbent. Well, I’ve been watching very carefully, and what I’ve seen is that an incumbent in the brick and mortar world is 80-20, but an incumbent in the digital world is 95-5. So here’s an example of this. You could go ask your 10-year-old kid, “Can you name a dozen car manufacturers?” And any 10-year-old kid could think of a dozen, Ferrari and Toyota and Kia. They could come up with a list. But can anybody name 12 search engines or 12 auction sites or 12 bookstores where you can buy any book?

John Jantsch: Well, I don’t know about you, but I have the top 100 search engines that every business should be in sitting right here next to me. I’m being facetious, of course, but remember when people used to talk about that.

Perry Marshall: Right. Right. And they all got washed out. Well, that’s because the internet is frictionless. So making cars, that’s friction all the way. Whether you go to the Toyota dealership or the Ford dealership, you have to drive across town, right? Okay. And so that supports there being 12 different car manufacturers. But if it’s Bing versus Google, there’s literally no difference whether you type in B-I-N-G or G-O-O-G-L-E on your browser. The only thing that makes a difference is how much you enjoy the experience. If Google is 10% better, then pretty soon everybody’s gonna use Google, and the Google’s gonna become 1,000% better, because they have more data and more customers and more bells and whistles and more everything. And pretty soon Bing doesn’t really have a chance.

And, see, everything in online marketing is like this. Basically, you’re either number one or you’re nobody. And I don’t think most people have really gotten this that this has happened. You’re either number one or you’re nothing. So that old phrase being a category of one, oh, it’s dead serious no. In a 95-5 world you have to be the number one. Whatever you do, you have to be the only one or you are hamburger.

John Jantsch: I think you can see that at a very real level for the local plumber, for example. I mean, all the searches are being done on a mobile device, and Google is determining, “Here’s the three positions that they’re gonna show.” And certainly if you don’t show up in those three, and as you suggest maybe number one of those three, you really don’t exist, I think. And so the digital world is even cutting into the world of friction.

Perry Marshall: It is.

John Jantsch: We may see a day when there’s only one car sale search engine, and the manufacturers are really, I think, playing basically to be there.

Perry Marshall: So I’ll make a prediction right now is that 10 years from now self-driving cars will be extremely common, and half of the auto manufacturers will either be out of business or bought out by the winners.

John Jantsch: Yeah. Yeah, because to some extent the brand won’t matter anymore.

Perry Marshall: No. It won’t. So watch out. Now, if you know this, if you know this, you can make predictions about the future. In many cases if you project 10 years in the future, if you are already pretty much know who the winner is, then you can bet on the winner, and you’ll gain. If there’s somebody out there … I don’t know. I don’t know who it might be, but if somebody out there already pretty much knows who’s gonna control the self-driving car thing, then you buy stock in that company. In 10 years from now you’ll be happy about it, because there probably isn’t that much that anybody can do even right now to change it. To give you another idea, there’s Bitcoin and there’s Ethereum, and there’s all these other little cryptocurrencies. Bitcoin already won. All the rest of them, that’s like .net, .cc, .name, .whatever. It’s just like domain names. They’ll have their little day in the sun and people will think. Bitcoin’s already won. It’s the winner-take-all phenomenon is on steroids.

John Jantsch:  I’m trying to figure out which direction to take this, because there’s so many we can go, and we’re really already out of time. So let me ask you how somebody would … And I’m trying to, again, end it on a really practical note. How would somebody apply this to an existing business? I can see a lot of people thinking, “Okay. If I could figure out this thing and predict the future, and I’ll create a business around that.” But how could somebody apply this? I mean, is this something that you have to have an epiphany? Or is this something that you have to just go out and start testing things in a certain way?

Perry Marshall: So here’s what you can do, and this is extremely practical. Richard [inaudible 00:26:29] and I put together this website called StarPrinciple.com. It’s free, and you can go click a dozen radio buttons and score your business. Basically it tells you how likely it is that you can dominate the niche that you’re in right now. It’s kind of a truth serum of this winner-take-all thing. So the score goes from zero to 200 points, and anything over 100 points is a home run. Okay? Now, some businesses will get a 25, and some will get a 75, and some will get 150. If you’re 150, man, you’re good, and you should pour on the gas. Well, so here’s what you do. Most of our businesses are really three or four businesses or three or four product lines or three or four markets, and they’re all kind of one umbrella. Here’s what you need to do. This could save somebody years of heartache and frustration right here. Okay?

You go, “All right. Well, I have product A, B, C, D. I have market A, B, C, D.” You score each one individually, because in one of your markets you’re really the number six player. In one of your markets you’re the number one player. One market is shrinking, and one market is growing. And you score that. And you break it up, and you need to figure out which part of my business do I pour the gas on and which part do I really just kind of ignore or I let coast? Right? Just give it as little gas I can get away with while I build the others, because 20% of your business is gonna produce 80% of the growth in the future, and the rest of it’s just gonna waste your time.

I think a lot of us aren’t really honest with ourselves about where our business is actually at and what it can really produce, and you need to be the winner. There is probably some part of your market where if you’re like, “Well, this part of the market isn’t very well served right now. Nobody else is really truly paying attention to this aspect, and I could totally nail it. And if I really put my resources into it, I could emerge as the absolute dominant player within six or 12 months,” and that’s what you should do.

John Jantsch: Visiting with Perry Marshal. We’re talking about the 80-20 principle, which is now 95-5 online. Winner take all is the game that we’re playing. Perry, thanks so much for joining us. Where can people find probably the best place to plug in to your, kind of, vast universe?

Perry Marshall: You can go to http://ift.tt/1TMHaKs. And just start by reading 80-20 in sales and marketing and just know that it’s even more true now than it was in 2013 when I wrote it. And the race is on. The race is on. It’s winner take it all, and whatever it is that you do, you need to find the thing where you can be number one, and you can totally dominate and be a category of one, because all..

http://ift.tt/2iF42kB

#Transcript of Unlocking the Power of 80/20

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Transcript of Unlocking the Power of 80/20

Transcript of Unlocking the Power of 80/20

Transcript of Unlocking the Power of 80/20 written by John Jantsch read more at Duct Tape Marketing

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John Jantsch: Hello and welcome to another episode of the Duct Tape Marketing Podcast. This is your host, John Jantsch, and my guest today is Perry Marshall. He’s an online marketing strategist, entrepreneur, and author of numerous books, including one we’re gonna talk about today, the 80-20 of sales and marketing. So, Perry, thanks for joining me.

Perry Marshall: John, it’s great to be here. It was great to be at your summit a couple of years ago where I met a lot of your people. The world just seems to be getting more and more eccentric, and there’s a lot for us to talk about today. Man, you’re either harnessing the eccentricity, or it’s pounding you on the back of the head with a two by four. And there’s not much in the middle, so very timely.

John Jantsch: Let’s get kind of a baseline. I mean, everybody’s heard the 80-20 thing. It’s almost become cliché how people apply it. But I don’t know that that many people, and this is your contention with the book, that many people get the leverage that it provides at a business level, do they?

Perry Marshall: No. First off, it’s not just a business rule of thumb. It’s a fact of nature. And, in fact, if I go to the beach with a bucket, and I pull out a bucket of sand, the sizes of the sand grains is gonna be 80-20. And how much water is in all the rivers is 80-20. The dirt on your carpet is 80-20, and the files in your hard drive. Okay? That’s the first thing. The second thing is that there’s an 80-20 inside every 80-20. When people really get this, it kind of flips them out. And so I can run a spreadsheet or a sales report of all my customers, and if I sort it from top to bottom, 20% of my customers are gonna generate 80% of the sales, but then if I chop off the bottom 80% that only produces 20%, whatever’s left, that top 20%, it’s still 80-20.

And I can do that again. And 4% of my customers are 64% of my business. And then I could do it again, and 1% of the customers are 50%. Well, this is true in almost any part of your business, and we’ll get into that. But then there’s a third thing. And this is probably a little bit new to most people, but the world is really becoming much more 95-5 where 5% of your efforts or your customers produce 95% of your results, and the other 95% only produces 5%. And this is especially true online. I’ve been watching this develop. People really need to understand this. The world is not … Cause and effect in the world operate fundamentally different than they did even 15 years ago. And I don’t think most people have gotten the memo. There’s a lot of examples of this out there.

John Jantsch: Let me stop you there, because I want to clarify something. And we’ll get, obviously, into examples, and I want to go back to the nature comment.

Perry Marshall: Yes.

John Jantsch: But it’s the simple kind of no-brainer lesson, then, to say, “Look, 95%” or if we want to use 80-20, still, to not scare too many people, is 80% of what you’re doing a waste of your time almost? I mean, especially when you get 95-5. It’s like 95% of my effort is on 5%? Quit doing that?

Perry Marshall: Well, yeah or almost, okay? You’ll always find that there’s a bunch of those things that somebody’s gotta do. It might not be you. It shouldn’t be you, but it’s gotta be somebody. But for example, 80 to 95% of all businesses fail or most entrepreneurs, we have all these little projects that we get into, and the project is a miniature little business, truth be told. Even if we didn’t go form an LLC or something. But actually anywhere from four-fifths to nine-tenths of those really don’t produce anything at the end of the day. And what’s happening in the world is that there’s more and more people kind of getting nowhere or just treading water or altogether losing, and then there’s this minority of people that are just absolutely slamming the ball out of the park, like it’s a triple. It’s a home run and then some. There’s less and less that’s in the middle. And so I think people today have to be more ruthless about how they spend their time than they’ve ever been before. There’s never been a time when busy work would get you less far than it does right now.

John Jantsch: And there’s probably never been more busy work.

Perry Marshall: Oh my gah. Yeah. Like, amazing amounts of busy work, and it doesn’t even look like busy work on the surface. You have to be really discerning. Lots of things, they just sound like good ideas, and a lot of them are based on, well, it’s really what was working in 2003, and it’s not really based on what’s going on right now. So I am issuing a wake up call.

John Jantsch: So let me go back to the nature comment about the grains of sand on the beach or all the things you cited from nature. I mean, is there some sort of principle that suggests why that’s the case?

Perry Marshall: Yes. Yes, and I’m not gonna get super theoretical. I could go into all kinds of stuff about chaos theory. This is really what it’s based on. But, John, I just want you to imagine that we put a table in the middle of your living room, and we went to some machine shop, and we machined the top of that table to be absolutely flat to within 100,000th of an inch, and it was a mirror finish. But then I want you to imagine that there’s a leak in your roof, and now we’re gonna drip water on that table, and the water is gonna drip into the middle of the table. So here’s a question of, “If I have the table perfectly level, and it’s perfectly flat, does that mean that the water is going to evenly spread out on the table, and then drip off the edge of the table in a smooth-flowing stream?

John Jantsch: My guess is it would probably gather as much energy to spread itself out in a very small section of where it landed.

Perry Marshall: Well, right. Right. And what would happen is no matter how flat you try to make that table, it’s gonna be a little bit easier for the water to go in one direction than the other ones, and then it starts going. And once it starts going, well, the erosion will wear, and then a million years later, there’s gonna be this big giant groove in the middle of your table that started out as flat. There’s nothing you could do to make the water flow equally. And here’s the thing is everything in life and nature is like that. So how water erodes or, for example, you’ve 10 14-year-old kids yesterday tried Jack Daniels for the first time. And maybe they all sort of liked it. But one of them liked it a little more than the rest of them, and so 30 years from now the rest of them all take a drink a week or two drinks a week and one of them has five drinks before breakfast, and he’s an alcoholic.

Okay? So your customers are like that. And my customers are like that. Everything is unequal. And the thing is is education conditions treat everything like it’s equal, treat everybody like they’re equal. The teachers try to make all the kids equal. Well, I just want everybody to get A’s and B’s. It’s like, “Well, they’re not going to.” And so entrepreneurs harness the eccentricities where a lot of more ivory tower people, they kind of try to pretend they’re not there. And so you have to just completely reverse the normal way that you think.

John Jantsch: Okay. So for that person out there that’s thinking, “Where in the world is this going and why is this gonna apply to my business?” Let’s bring it back to something very practical inside a business. How could somebody start spotting that 95% opportunity?

Perry Marshall: Let me tell you a story, and maybe a couple of your people have heard this one before, but this is my favorite 80-20 story. I have a friend named John Paul [inaudible 00:10:15] who dropped out of high school when he was 17, and he hitchhiked from Denver to Las Vegas with a couple of gambling books under his arm, and he’s like, “I’m gonna become a professional gambler.” He starts going to casinos and playing poker every day and living by his whits at age 17. And after a few weeks of this he was like, “Dang. This is harder than I thought.” He bumps into this guy who runs a gambling ring named Rob, and he starts talking to him. And he says, “Well, could you teach me how to do this?” And Rob says, “For a percentage of your winnings I could teach you how to do this.” And so they shake on it.

And after they do that, “Hey, jump in the jeep, John. We’re going for a ride.” So they get in the car, and they’re going down the highway, and John says, “Okay. So how do I win more poker games?” And Rob goes, “You have to play people who are going to lose. And those people are called marks, and you need to find the marks in the room, and you need to play poker with them, and you don’t play poker with anybody else.” And he says, “Well, how do I find the marks?” And he says, “Here. I’ll show you.” And he pulls into a parking lot of a strip club, and they go in there. And there’s women and there’s rock and roll, and there’s people drinking and all this commotion and noise in there.

And he sits down at the table, and Rob pulls a sawed off shotgun out of his jacket. And he opens the chamber, and under the table, then he snaps it shut and it goes “chitch.” And all these guys look around. And John sees them. And the owner come over, and he says, “Hey, what’s going on over here?” And Rob goes, “Hey, we’re just fine. There’s no problem here. We’re just teaching the lad a lesson, not gonna cause any trouble. Don’t worry about us.” And then Rob turns to John and he says, “John, did you see those guys who turned around when I made that noise?” And he’s like, “Yeah. Those biker guys over there?” “Yeah, those guys.” And John goes, “Yeah.” And he says, “Don’t play poker with them. They’re not marks. Play poker with everybody else.”

Now, that was what I call racking the shotgun, and everything you do in marketing is rack the shotgun. In fact, I’ve trained my customers and clients to use that phrase all the time. Rack the shotgun is when you … You know who racks the shotgun all the time is Donald Trump, okay? Now, I’m not saying he does it for good reasons or whatever. I’m not making any statements about any of that, but he does it. Okay? And he gets a response. Now, what I have always found out is most people are instinctively afraid to rack the shotgun. They’re afraid to find out the truth. They’re afraid to go make that big noise out there and see, “Okay, who’s gonna turn their head and who’s gonna ignore?” Or, “Who’s gonna say no and who’s gonna say yes.”

I mean, it could even go all the way down to your teenager like, “Well, you know, I don’t want to … She came in at 2:30 in the morning last night, and I don’t really want to ruffle any feathers, and we seem to be getting” … Well, that’s like being afraid to rack the shotgun. Like, well, if you don’t know why your teenager came in at 2:30 in the morning, then whatever the reason is is probably not a good one, right? But you have to ask.

John Jantsch: Ignorance is bliss, right? Yeah.

Perry Marshall: I talked to a guy about … He owned a smoothie store, and he was doing all this Facebook and social media stuff, and I’d go, “Well, do you ever send them emails?” He goes, “No, I’m afraid of them unsubscribing.” Well, that’s racking the shotgun, man. I said, “Email is 10 times better than social media. You’re not emailing, because you’re afraid some people won’t like it? Send them an email. Let them unsubscribe. It’s fine.” In fact, if you’re unsubscribe rate is less than 5% or even 10, you’re probably not selling hard enough. So everything you do, everything you do in marketing is racking the shotgun.

John Jantsch: So what you’re, again, coming back to my original question on that, what you’re suggesting is that’s how you’re gonna find the leverage?

Perry Marshall: Yeah. With people, right, you’re gonna find that most people actually aren’t gonna respond to anything that you do. They’re never gonna buy, okay? And maybe it’s 80% aren’t gonna buy or maybe it’s 60% or maybe it’s 95% aren’t gonna buy. But there is a rack the shotgun just with buying. Now, the interesting part about 80-20 is that if you rack a shotgun, and you get, let’s call it $100 shotgun. It’s a $100 transaction, let’s say, and you get 100 people to respond. Well, if you quadruple the price, if you rack a $400 shotgun, 20% of those people will respond again. And if you rack a $1,600 shotgun, 20% of those people will respond again. If you rack a $6,400 shotgun, 20% of those people will respond again. And so you’ll find that even though you started with only 100 people, let’s say, who would spend $100, you might find one person who would spend $50,000. And you didn’t know it, and that person was already there. That person is already in your audience. And what I am seeing is that all of this is becoming more pronounced than it used to be.

John Jantsch: So it really, I mean, again, one of the sort of core principles was you build a business, you got customers. You need to be trying to sell them more. I mean, essentially you’re saying that, but maybe at a level people haven’t considered, that not just is there an opportunity to maybe sell more, but that there is a sort of almost mathematical equation that says what you should you sell them and how much it should cost and who’s gonna respond?

Perry Marshall: That’s right. There is a hunger in the marketplace that there’s a small percentage of people who they have an extreme itch that they would like to scratch. And it’s almost unscratchable. When it’s just your product line, there’s some other things I want to get into, but let’s just restrict it to your product line right now. So 80-20 says, “If I have a Starbucks, and a thousand a people a month are buying a $5 latte, one of those people will buy a $2,700 gleaming stainless steel espresso machine.” And it’s just about a law of physics. Now, I started to notice something really interesting when I started teaching Google AdWords. I wrote the world’s best selling books on Google and Facebook advertising, and all of a sudden when AdWords came into existence, all of these new businesses that might not have even been able to exist before suddenly popped up.

And it was this giant feeding frenzy and gold rush. And what I noticed was that if somebody could get to the top in AdWords, they could get the number one position, which gets the most traffic. And then if they could streamline all the stuff in their website, the shopping cart, the sales pages, the landing pages, the offer, the unique selling proposition, if they could dial all that in and test it to the hilt, they would get to a point where nobody could shove them out of the way. They’re number one, they might be number on TV, and they might not be number one on the radio, and they might not be number one on main street, but if they’re number one in Google AdWords, and if they got their sales machine dialed in, they’re almost unstoppable.

Now, here’s why this was. It was because number two, number three, number four, number five, they all have to test their way to success, and they have to experimentally find what works, but you’re already getting more traffic than they are, and you can already do more tests than they are. And so you’re previous success greases the skids for you to continue to be successful, because you’re the incumbent. Well, I’ve been watching very carefully, and what I’ve seen is that an incumbent in the brick and mortar world is 80-20, but an incumbent in the digital world is 95-5. So here’s an example of this. You could go ask your 10-year-old kid, “Can you name a dozen car manufacturers?” And any 10-year-old kid could think of a dozen, Ferrari and Toyota and Kia. They could come up with a list. But can anybody name 12 search engines or 12 auction sites or 12 bookstores where you can buy any book?

John Jantsch: Well, I don’t know about you, but I have the top 100 search engines that every business should be in sitting right here next to me. I’m being facetious, of course, but remember when people used to talk about that.

Perry Marshall: Right. Right. And they all got washed out. Well, that’s because the internet is frictionless. So making cars, that’s friction all the way. Whether you go to the Toyota dealership or the Ford dealership, you have to drive across town, right? Okay. And so that supports there being 12 different car manufacturers. But if it’s Bing versus Google, there’s literally no difference whether you type in B-I-N-G or G-O-O-G-L-E on your browser. The only thing that makes a difference is how much you enjoy the experience. If Google is 10% better, then pretty soon everybody’s gonna use Google, and the Google’s gonna become 1,000% better, because they have more data and more customers and more bells and whistles and more everything. And pretty soon Bing doesn’t really have a chance.

And, see, everything in online marketing is like this. Basically, you’re either number one or you’re nobody. And I don’t think most people have really gotten this that this has happened. You’re either number one or you’re nothing. So that old phrase being a category of one, oh, it’s dead serious no. In a 95-5 world you have to be the number one. Whatever you do, you have to be the only one or you are hamburger.

John Jantsch: I think you can see that at a very real level for the local plumber, for example. I mean, all the searches are being done on a mobile device, and Google is determining, “Here’s the three positions that they’re gonna show.” And certainly if you don’t show up in those three, and as you suggest maybe number one of those three, you really don’t exist, I think. And so the digital world is even cutting into the world of friction.

Perry Marshall: It is.

John Jantsch: We may see a day when there’s only one car sale search engine, and the manufacturers are really, I think, playing basically to be there.

Perry Marshall: So I’ll make a prediction right now is that 10 years from now self-driving cars will be extremely common, and half of the auto manufacturers will either be out of business or bought out by the winners.

John Jantsch: Yeah. Yeah, because to some extent the brand won’t matter anymore.

Perry Marshall: No. It won’t. So watch out. Now, if you know this, if you know this, you can make predictions about the future. In many cases if you project 10 years in the future, if you are already pretty much know who the winner is, then you can bet on the winner, and you’ll gain. If there’s somebody out there … I don’t know. I don’t know who it might be, but if somebody out there already pretty much knows who’s gonna control the self-driving car thing, then you buy stock in that company. In 10 years from now you’ll be happy about it, because there probably isn’t that much that anybody can do even right now to change it. To give you another idea, there’s Bitcoin and there’s Ethereum, and there’s all these other little cryptocurrencies. Bitcoin already won. All the rest of them, that’s like .net, .cc, .name, .whatever. It’s just like domain names. They’ll have their little day in the sun and people will think. Bitcoin’s already won. It’s the winner-take-all phenomenon is on steroids.

John Jantsch:  I’m trying to figure out which direction to take this, because there’s so many we can go, and we’re really already out of time. So let me ask you how somebody would … And I’m trying to, again, end it on a really practical note. How would somebody apply this to an existing business? I can see a lot of people thinking, “Okay. If I could figure out this thing and predict the future, and I’ll create a business around that.” But how could somebody apply this? I mean, is this something that you have to have an epiphany? Or is this something that you have to just go out and start testing things in a certain way?

Perry Marshall: So here’s what you can do, and this is extremely practical. Richard [inaudible 00:26:29] and I put together this website called StarPrinciple.com. It’s free, and you can go click a dozen radio buttons and score your business. Basically it tells you how likely it is that you can dominate the niche that you’re in right now. It’s kind of a truth serum of this winner-take-all thing. So the score goes from zero to 200 points, and anything over 100 points is a home run. Okay? Now, some businesses will get a 25, and some will get a 75, and some will get 150. If you’re 150, man, you’re good, and you should pour on the gas. Well, so here’s what you do. Most of our businesses are really three or four businesses or three or four product lines or three or four markets, and they’re all kind of one umbrella. Here’s what you need to do. This could save somebody years of heartache and frustration right here. Okay?

You go, “All right. Well, I have product A, B, C, D. I have market A, B, C, D.” You score each one individually, because in one of your markets you’re really the number six player. In one of your markets you’re the number one player. One market is shrinking, and one market is growing. And you score that. And you break it up, and you need to figure out which part of my business do I pour the gas on and which part do I really just kind of ignore or I let coast? Right? Just give it as little gas I can get away with while I build the others, because 20% of your business is gonna produce 80% of the growth in the future, and the rest of it’s just gonna waste your time.

I think a lot of us aren’t really honest with ourselves about where our business is actually at and what it can really produce, and you need to be the winner. There is probably some part of your market where if you’re like, “Well, this part of the market isn’t very well served right now. Nobody else is really truly paying attention to this aspect, and I could totally nail it. And if I really put my resources into it, I could emerge as the absolute dominant player within six or 12 months,” and that’s what you should do.

John Jantsch: Visiting with Perry Marshal. We’re talking about the 80-20 principle, which is now 95-5 online. Winner take all is the game that we’re playing. Perry, thanks so much for joining us. Where can people find probably the best place to plug in to your, kind of, vast universe?

Perry Marshall: You can go to http://ift.tt/1TMHaKs. And just start by reading 80-20 in sales and marketing and just know that it’s even more true now than it was in 2013 when I wrote it. And the race is on. The race is on. It’s winner take it all, and whatever it is that you do, you need to find the thing where you can be number one, and you can totally dominate and be a category of one, because all..

http://ift.tt/2iF42kB

#Transcript of Unlocking the Power of 80/20

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Transcript of Unlocking the Power of 80/20

Transcript of Unlocking the Power of 80/20

Transcript of Unlocking the Power of 80/20 written by John Jantsch read more at Duct Tape Marketing

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John Jantsch: Hello and welcome to another episode of the Duct Tape Marketing Podcast. This is your host, John Jantsch, and my guest today is Perry Marshall. He’s an online marketing strategist, entrepreneur, and author of numerous books, including one we’re gonna talk about today, the 80-20 of sales and marketing. So, Perry, thanks for joining me.

Perry Marshall: John, it’s great to be here. It was great to be at your summit a couple of years ago where I met a lot of your people. The world just seems to be getting more and more eccentric, and there’s a lot for us to talk about today. Man, you’re either harnessing the eccentricity, or it’s pounding you on the back of the head with a two by four. And there’s not much in the middle, so very timely.

John Jantsch: Let’s get kind of a baseline. I mean, everybody’s heard the 80-20 thing. It’s almost become cliché how people apply it. But I don’t know that that many people, and this is your contention with the book, that many people get the leverage that it provides at a business level, do they?

Perry Marshall: No. First off, it’s not just a business rule of thumb. It’s a fact of nature. And, in fact, if I go to the beach with a bucket, and I pull out a bucket of sand, the sizes of the sand grains is gonna be 80-20. And how much water is in all the rivers is 80-20. The dirt on your carpet is 80-20, and the files in your hard drive. Okay? That’s the first thing. The second thing is that there’s an 80-20 inside every 80-20. When people really get this, it kind of flips them out. And so I can run a spreadsheet or a sales report of all my customers, and if I sort it from top to bottom, 20% of my customers are gonna generate 80% of the sales, but then if I chop off the bottom 80% that only produces 20%, whatever’s left, that top 20%, it’s still 80-20.

And I can do that again. And 4% of my customers are 64% of my business. And then I could do it again, and 1% of the customers are 50%. Well, this is true in almost any part of your business, and we’ll get into that. But then there’s a third thing. And this is probably a little bit new to most people, but the world is really becoming much more 95-5 where 5% of your efforts or your customers produce 95% of your results, and the other 95% only produces 5%. And this is especially true online. I’ve been watching this develop. People really need to understand this. The world is not … Cause and effect in the world operate fundamentally different than they did even 15 years ago. And I don’t think most people have gotten the memo. There’s a lot of examples of this out there.

John Jantsch: Let me stop you there, because I want to clarify something. And we’ll get, obviously, into examples, and I want to go back to the nature comment.

Perry Marshall: Yes.

John Jantsch: But it’s the simple kind of no-brainer lesson, then, to say, “Look, 95%” or if we want to use 80-20, still, to not scare too many people, is 80% of what you’re doing a waste of your time almost? I mean, especially when you get 95-5. It’s like 95% of my effort is on 5%? Quit doing that?

Perry Marshall: Well, yeah or almost, okay? You’ll always find that there’s a bunch of those things that somebody’s gotta do. It might not be you. It shouldn’t be you, but it’s gotta be somebody. But for example, 80 to 95% of all businesses fail or most entrepreneurs, we have all these little projects that we get into, and the project is a miniature little business, truth be told. Even if we didn’t go form an LLC or something. But actually anywhere from four-fifths to nine-tenths of those really don’t produce anything at the end of the day. And what’s happening in the world is that there’s more and more people kind of getting nowhere or just treading water or altogether losing, and then there’s this minority of people that are just absolutely slamming the ball out of the park, like it’s a triple. It’s a home run and then some. There’s less and less that’s in the middle. And so I think people today have to be more ruthless about how they spend their time than they’ve ever been before. There’s never been a time when busy work would get you less far than it does right now.

John Jantsch: And there’s probably never been more busy work.

Perry Marshall: Oh my gah. Yeah. Like, amazing amounts of busy work, and it doesn’t even look like busy work on the surface. You have to be really discerning. Lots of things, they just sound like good ideas, and a lot of them are based on, well, it’s really what was working in 2003, and it’s not really based on what’s going on right now. So I am issuing a wake up call.

John Jantsch: So let me go back to the nature comment about the grains of sand on the beach or all the things you cited from nature. I mean, is there some sort of principle that suggests why that’s the case?

Perry Marshall: Yes. Yes, and I’m not gonna get super theoretical. I could go into all kinds of stuff about chaos theory. This is really what it’s based on. But, John, I just want you to imagine that we put a table in the middle of your living room, and we went to some machine shop, and we machined the top of that table to be absolutely flat to within 100,000th of an inch, and it was a mirror finish. But then I want you to imagine that there’s a leak in your roof, and now we’re gonna drip water on that table, and the water is gonna drip into the middle of the table. So here’s a question of, “If I have the table perfectly level, and it’s perfectly flat, does that mean that the water is going to evenly spread out on the table, and then drip off the edge of the table in a smooth-flowing stream?

John Jantsch: My guess is it would probably gather as much energy to spread itself out in a very small section of where it landed.

Perry Marshall: Well, right. Right. And what would happen is no matter how flat you try to make that table, it’s gonna be a little bit easier for the water to go in one direction than the other ones, and then it starts going. And once it starts going, well, the erosion will wear, and then a million years later, there’s gonna be this big giant groove in the middle of your table that started out as flat. There’s nothing you could do to make the water flow equally. And here’s the thing is everything in life and nature is like that. So how water erodes or, for example, you’ve 10 14-year-old kids yesterday tried Jack Daniels for the first time. And maybe they all sort of liked it. But one of them liked it a little more than the rest of them, and so 30 years from now the rest of them all take a drink a week or two drinks a week and one of them has five drinks before breakfast, and he’s an alcoholic.

Okay? So your customers are like that. And my customers are like that. Everything is unequal. And the thing is is education conditions treat everything like it’s equal, treat everybody like they’re equal. The teachers try to make all the kids equal. Well, I just want everybody to get A’s and B’s. It’s like, “Well, they’re not going to.” And so entrepreneurs harness the eccentricities where a lot of more ivory tower people, they kind of try to pretend they’re not there. And so you have to just completely reverse the normal way that you think.

John Jantsch: Okay. So for that person out there that’s thinking, “Where in the world is this going and why is this gonna apply to my business?” Let’s bring it back to something very practical inside a business. How could somebody start spotting that 95% opportunity?

Perry Marshall: Let me tell you a story, and maybe a couple of your people have heard this one before, but this is my favorite 80-20 story. I have a friend named John Paul [inaudible 00:10:15] who dropped out of high school when he was 17, and he hitchhiked from Denver to Las Vegas with a couple of gambling books under his arm, and he’s like, “I’m gonna become a professional gambler.” He starts going to casinos and playing poker every day and living by his whits at age 17. And after a few weeks of this he was like, “Dang. This is harder than I thought.” He bumps into this guy who runs a gambling ring named Rob, and he starts talking to him. And he says, “Well, could you teach me how to do this?” And Rob says, “For a percentage of your winnings I could teach you how to do this.” And so they shake on it.

And after they do that, “Hey, jump in the jeep, John. We’re going for a ride.” So they get in the car, and they’re going down the highway, and John says, “Okay. So how do I win more poker games?” And Rob goes, “You have to play people who are going to lose. And those people are called marks, and you need to find the marks in the room, and you need to play poker with them, and you don’t play poker with anybody else.” And he says, “Well, how do I find the marks?” And he says, “Here. I’ll show you.” And he pulls into a parking lot of a strip club, and they go in there. And there’s women and there’s rock and roll, and there’s people drinking and all this commotion and noise in there.

And he sits down at the table, and Rob pulls a sawed off shotgun out of his jacket. And he opens the chamber, and under the table, then he snaps it shut and it goes “chitch.” And all these guys look around. And John sees them. And the owner come over, and he says, “Hey, what’s going on over here?” And Rob goes, “Hey, we’re just fine. There’s no problem here. We’re just teaching the lad a lesson, not gonna cause any trouble. Don’t worry about us.” And then Rob turns to John and he says, “John, did you see those guys who turned around when I made that noise?” And he’s like, “Yeah. Those biker guys over there?” “Yeah, those guys.” And John goes, “Yeah.” And he says, “Don’t play poker with them. They’re not marks. Play poker with everybody else.”

Now, that was what I call racking the shotgun, and everything you do in marketing is rack the shotgun. In fact, I’ve trained my customers and clients to use that phrase all the time. Rack the shotgun is when you … You know who racks the shotgun all the time is Donald Trump, okay? Now, I’m not saying he does it for good reasons or whatever. I’m not making any statements about any of that, but he does it. Okay? And he gets a response. Now, what I have always found out is most people are instinctively afraid to rack the shotgun. They’re afraid to find out the truth. They’re afraid to go make that big noise out there and see, “Okay, who’s gonna turn their head and who’s gonna ignore?” Or, “Who’s gonna say no and who’s gonna say yes.”

I mean, it could even go all the way down to your teenager like, “Well, you know, I don’t want to … She came in at 2:30 in the morning last night, and I don’t really want to ruffle any feathers, and we seem to be getting” … Well, that’s like being afraid to rack the shotgun. Like, well, if you don’t know why your teenager came in at 2:30 in the morning, then whatever the reason is is probably not a good one, right? But you have to ask.

John Jantsch: Ignorance is bliss, right? Yeah.

Perry Marshall: I talked to a guy about … He owned a smoothie store, and he was doing all this Facebook and social media stuff, and I’d go, “Well, do you ever send them emails?” He goes, “No, I’m afraid of them unsubscribing.” Well, that’s racking the shotgun, man. I said, “Email is 10 times better than social media. You’re not emailing, because you’re afraid some people won’t like it? Send them an email. Let them unsubscribe. It’s fine.” In fact, if you’re unsubscribe rate is less than 5% or even 10, you’re probably not selling hard enough. So everything you do, everything you do in marketing is racking the shotgun.

John Jantsch: So what you’re, again, coming back to my original question on that, what you’re suggesting is that’s how you’re gonna find the leverage?

Perry Marshall: Yeah. With people, right, you’re gonna find that most people actually aren’t gonna respond to anything that you do. They’re never gonna buy, okay? And maybe it’s 80% aren’t gonna buy or maybe it’s 60% or maybe it’s 95% aren’t gonna buy. But there is a rack the shotgun just with buying. Now, the interesting part about 80-20 is that if you rack a shotgun, and you get, let’s call it $100 shotgun. It’s a $100 transaction, let’s say, and you get 100 people to respond. Well, if you quadruple the price, if you rack a $400 shotgun, 20% of those people will respond again. And if you rack a $1,600 shotgun, 20% of those people will respond again. If you rack a $6,400 shotgun, 20% of those people will respond again. And so you’ll find that even though you started with only 100 people, let’s say, who would spend $100, you might find one person who would spend $50,000. And you didn’t know it, and that person was already there. That person is already in your audience. And what I am seeing is that all of this is becoming more pronounced than it used to be.

John Jantsch: So it really, I mean, again, one of the sort of core principles was you build a business, you got customers. You need to be trying to sell them more. I mean, essentially you’re saying that, but maybe at a level people haven’t considered, that not just is there an opportunity to maybe sell more, but that there is a sort of almost mathematical equation that says what you should you sell them and how much it should cost and who’s gonna respond?

Perry Marshall: That’s right. There is a hunger in the marketplace that there’s a small percentage of people who they have an extreme itch that they would like to scratch. And it’s almost unscratchable. When it’s just your product line, there’s some other things I want to get into, but let’s just restrict it to your product line right now. So 80-20 says, “If I have a Starbucks, and a thousand a people a month are buying a $5 latte, one of those people will buy a $2,700 gleaming stainless steel espresso machine.” And it’s just about a law of physics. Now, I started to notice something really interesting when I started teaching Google AdWords. I wrote the world’s best selling books on Google and Facebook advertising, and all of a sudden when AdWords came into existence, all of these new businesses that might not have even been able to exist before suddenly popped up.

And it was this giant feeding frenzy and gold rush. And what I noticed was that if somebody could get to the top in AdWords, they could get the number one position, which gets the most traffic. And then if they could streamline all the stuff in their website, the shopping cart, the sales pages, the landing pages, the offer, the unique selling proposition, if they could dial all that in and test it to the hilt, they would get to a point where nobody could shove them out of the way. They’re number one, they might be number on TV, and they might not be number one on the radio, and they might not be number one on main street, but if they’re number one in Google AdWords, and if they got their sales machine dialed in, they’re almost unstoppable.

Now, here’s why this was. It was because number two, number three, number four, number five, they all have to test their way to success, and they have to experimentally find what works, but you’re already getting more traffic than they are, and you can already do more tests than they are. And so you’re previous success greases the skids for you to continue to be successful, because you’re the incumbent. Well, I’ve been watching very carefully, and what I’ve seen is that an incumbent in the brick and mortar world is 80-20, but an incumbent in the digital world is 95-5. So here’s an example of this. You could go ask your 10-year-old kid, “Can you name a dozen car manufacturers?” And any 10-year-old kid could think of a dozen, Ferrari and Toyota and Kia. They could come up with a list. But can anybody name 12 search engines or 12 auction sites or 12 bookstores where you can buy any book?

John Jantsch: Well, I don’t know about you, but I have the top 100 search engines that every business should be in sitting right here next to me. I’m being facetious, of course, but remember when people used to talk about that.

Perry Marshall: Right. Right. And they all got washed out. Well, that’s because the internet is frictionless. So making cars, that’s friction all the way. Whether you go to the Toyota dealership or the Ford dealership, you have to drive across town, right? Okay. And so that supports there being 12 different car manufacturers. But if it’s Bing versus Google, there’s literally no difference whether you type in B-I-N-G or G-O-O-G-L-E on your browser. The only thing that makes a difference is how much you enjoy the experience. If Google is 10% better, then pretty soon everybody’s gonna use Google, and the Google’s gonna become 1,000% better, because they have more data and more customers and more bells and whistles and more everything. And pretty soon Bing doesn’t really have a chance.

And, see, everything in online marketing is like this. Basically, you’re either number one or you’re nobody. And I don’t think most people have really gotten this that this has happened. You’re either number one or you’re nothing. So that old phrase being a category of one, oh, it’s dead serious no. In a 95-5 world you have to be the number one. Whatever you do, you have to be the only one or you are hamburger.

John Jantsch: I think you can see that at a very real level for the local plumber, for example. I mean, all the searches are being done on a mobile device, and Google is determining, “Here’s the three positions that they’re gonna show.” And certainly if you don’t show up in those three, and as you suggest maybe number one of those three, you really don’t exist, I think. And so the digital world is even cutting into the world of friction.

Perry Marshall: It is.

John Jantsch: We may see a day when there’s only one car sale search engine, and the manufacturers are really, I think, playing basically to be there.

Perry Marshall: So I’ll make a prediction right now is that 10 years from now self-driving cars will be extremely common, and half of the auto manufacturers will either be out of business or bought out by the winners.

John Jantsch: Yeah. Yeah, because to some extent the brand won’t matter anymore.

Perry Marshall: No. It won’t. So watch out. Now, if you know this, if you know this, you can make predictions about the future. In many cases if you project 10 years in the future, if you are already pretty much know who the winner is, then you can bet on the winner, and you’ll gain. If there’s somebody out there … I don’t know. I don’t know who it might be, but if somebody out there already pretty much knows who’s gonna control the self-driving car thing, then you buy stock in that company. In 10 years from now you’ll be happy about it, because there probably isn’t that much that anybody can do even right now to change it. To give you another idea, there’s Bitcoin and there’s Ethereum, and there’s all these other little cryptocurrencies. Bitcoin already won. All the rest of them, that’s like .net, .cc, .name, .whatever. It’s just like domain names. They’ll have their little day in the sun and people will think. Bitcoin’s already won. It’s the winner-take-all phenomenon is on steroids.

John Jantsch:  I’m trying to figure out which direction to take this, because there’s so many we can go, and we’re really already out of time. So let me ask you how somebody would … And I’m trying to, again, end it on a really practical note. How would somebody apply this to an existing business? I can see a lot of people thinking, “Okay. If I could figure out this thing and predict the future, and I’ll create a business around that.” But how could somebody apply this? I mean, is this something that you have to have an epiphany? Or is this something that you have to just go out and start testing things in a certain way?

Perry Marshall: So here’s what you can do, and this is extremely practical. Richard [inaudible 00:26:29] and I put together this website called StarPrinciple.com. It’s free, and you can go click a dozen radio buttons and score your business. Basically it tells you how likely it is that you can dominate the niche that you’re in right now. It’s kind of a truth serum of this winner-take-all thing. So the score goes from zero to 200 points, and anything over 100 points is a home run. Okay? Now, some businesses will get a 25, and some will get a 75, and some will get 150. If you’re 150, man, you’re good, and you should pour on the gas. Well, so here’s what you do. Most of our businesses are really three or four businesses or three or four product lines or three or four markets, and they’re all kind of one umbrella. Here’s what you need to do. This could save somebody years of heartache and frustration right here. Okay?

You go, “All right. Well, I have product A, B, C, D. I have market A, B, C, D.” You score each one individually, because in one of your markets you’re really the number six player. In one of your markets you’re the number one player. One market is shrinking, and one market is growing. And you score that. And you break it up, and you need to figure out which part of my business do I pour the gas on and which part do I really just kind of ignore or I let coast? Right? Just give it as little gas I can get away with while I build the others, because 20% of your business is gonna produce 80% of the growth in the future, and the rest of it’s just gonna waste your time.

I think a lot of us aren’t really honest with ourselves about where our business is actually at and what it can really produce, and you need to be the winner. There is probably some part of your market where if you’re like, “Well, this part of the market isn’t very well served right now. Nobody else is really truly paying attention to this aspect, and I could totally nail it. And if I really put my resources into it, I could emerge as the absolute dominant player within six or 12 months,” and that’s what you should do.

John Jantsch: Visiting with Perry Marshal. We’re talking about the 80-20 principle, which is now 95-5 online. Winner take all is the game that we’re playing. Perry, thanks so much for joining us. Where can people find probably the best place to plug in to your, kind of, vast universe?

Perry Marshall: You can go to http://ift.tt/1TMHaKs. And just start by reading 80-20 in sales and marketing and just know that it’s even more true now than it was in 2013 when I wrote it. And the race is on. The race is on. It’s winner take it all, and whatever it is that you do, you need to find the thing where you can be number one, and you can totally dominate and be a category of one, because all..

http://ift.tt/2iF42kB

#Transcript of Unlocking the Power of 80/20

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Transcript of Unlocking the Power of 80/20

Transcript of Unlocking the Power of 80/20

Transcript of Unlocking the Power of 80/20 written by John Jantsch read more at Duct Tape Marketing

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John Jantsch: Hello and welcome to another episode of the Duct Tape Marketing Podcast. This is your host, John Jantsch, and my guest today is Perry Marshall. He’s an online marketing strategist, entrepreneur, and author of numerous books, including one we’re gonna talk about today, the 80-20 of sales and marketing. So, Perry, thanks for joining me.

Perry Marshall: John, it’s great to be here. It was great to be at your summit a couple of years ago where I met a lot of your people. The world just seems to be getting more and more eccentric, and there’s a lot for us to talk about today. Man, you’re either harnessing the eccentricity, or it’s pounding you on the back of the head with a two by four. And there’s not much in the middle, so very timely.

John Jantsch: Let’s get kind of a baseline. I mean, everybody’s heard the 80-20 thing. It’s almost become cliché how people apply it. But I don’t know that that many people, and this is your contention with the book, that many people get the leverage that it provides at a business level, do they?

Perry Marshall: No. First off, it’s not just a business rule of thumb. It’s a fact of nature. And, in fact, if I go to the beach with a bucket, and I pull out a bucket of sand, the sizes of the sand grains is gonna be 80-20. And how much water is in all the rivers is 80-20. The dirt on your carpet is 80-20, and the files in your hard drive. Okay? That’s the first thing. The second thing is that there’s an 80-20 inside every 80-20. When people really get this, it kind of flips them out. And so I can run a spreadsheet or a sales report of all my customers, and if I sort it from top to bottom, 20% of my customers are gonna generate 80% of the sales, but then if I chop off the bottom 80% that only produces 20%, whatever’s left, that top 20%, it’s still 80-20.

And I can do that again. And 4% of my customers are 64% of my business. And then I could do it again, and 1% of the customers are 50%. Well, this is true in almost any part of your business, and we’ll get into that. But then there’s a third thing. And this is probably a little bit new to most people, but the world is really becoming much more 95-5 where 5% of your efforts or your customers produce 95% of your results, and the other 95% only produces 5%. And this is especially true online. I’ve been watching this develop. People really need to understand this. The world is not … Cause and effect in the world operate fundamentally different than they did even 15 years ago. And I don’t think most people have gotten the memo. There’s a lot of examples of this out there.

John Jantsch: Let me stop you there, because I want to clarify something. And we’ll get, obviously, into examples, and I want to go back to the nature comment.

Perry Marshall: Yes.

John Jantsch: But it’s the simple kind of no-brainer lesson, then, to say, “Look, 95%” or if we want to use 80-20, still, to not scare too many people, is 80% of what you’re doing a waste of your time almost? I mean, especially when you get 95-5. It’s like 95% of my effort is on 5%? Quit doing that?

Perry Marshall: Well, yeah or almost, okay? You’ll always find that there’s a bunch of those things that somebody’s gotta do. It might not be you. It shouldn’t be you, but it’s gotta be somebody. But for example, 80 to 95% of all businesses fail or most entrepreneurs, we have all these little projects that we get into, and the project is a miniature little business, truth be told. Even if we didn’t go form an LLC or something. But actually anywhere from four-fifths to nine-tenths of those really don’t produce anything at the end of the day. And what’s happening in the world is that there’s more and more people kind of getting nowhere or just treading water or altogether losing, and then there’s this minority of people that are just absolutely slamming the ball out of the park, like it’s a triple. It’s a home run and then some. There’s less and less that’s in the middle. And so I think people today have to be more ruthless about how they spend their time than they’ve ever been before. There’s never been a time when busy work would get you less far than it does right now.

John Jantsch: And there’s probably never been more busy work.

Perry Marshall: Oh my gah. Yeah. Like, amazing amounts of busy work, and it doesn’t even look like busy work on the surface. You have to be really discerning. Lots of things, they just sound like good ideas, and a lot of them are based on, well, it’s really what was working in 2003, and it’s not really based on what’s going on right now. So I am issuing a wake up call.

John Jantsch: So let me go back to the nature comment about the grains of sand on the beach or all the things you cited from nature. I mean, is there some sort of principle that suggests why that’s the case?

Perry Marshall: Yes. Yes, and I’m not gonna get super theoretical. I could go into all kinds of stuff about chaos theory. This is really what it’s based on. But, John, I just want you to imagine that we put a table in the middle of your living room, and we went to some machine shop, and we machined the top of that table to be absolutely flat to within 100,000th of an inch, and it was a mirror finish. But then I want you to imagine that there’s a leak in your roof, and now we’re gonna drip water on that table, and the water is gonna drip into the middle of the table. So here’s a question of, “If I have the table perfectly level, and it’s perfectly flat, does that mean that the water is going to evenly spread out on the table, and then drip off the edge of the table in a smooth-flowing stream?

John Jantsch: My guess is it would probably gather as much energy to spread itself out in a very small section of where it landed.

Perry Marshall: Well, right. Right. And what would happen is no matter how flat you try to make that table, it’s gonna be a little bit easier for the water to go in one direction than the other ones, and then it starts going. And once it starts going, well, the erosion will wear, and then a million years later, there’s gonna be this big giant groove in the middle of your table that started out as flat. There’s nothing you could do to make the water flow equally. And here’s the thing is everything in life and nature is like that. So how water erodes or, for example, you’ve 10 14-year-old kids yesterday tried Jack Daniels for the first time. And maybe they all sort of liked it. But one of them liked it a little more than the rest of them, and so 30 years from now the rest of them all take a drink a week or two drinks a week and one of them has five drinks before breakfast, and he’s an alcoholic.

Okay? So your customers are like that. And my customers are like that. Everything is unequal. And the thing is is education conditions treat everything like it’s equal, treat everybody like they’re equal. The teachers try to make all the kids equal. Well, I just want everybody to get A’s and B’s. It’s like, “Well, they’re not going to.” And so entrepreneurs harness the eccentricities where a lot of more ivory tower people, they kind of try to pretend they’re not there. And so you have to just completely reverse the normal way that you think.

John Jantsch: Okay. So for that person out there that’s thinking, “Where in the world is this going and why is this gonna apply to my business?” Let’s bring it back to something very practical inside a business. How could somebody start spotting that 95% opportunity?

Perry Marshall: Let me tell you a story, and maybe a couple of your people have heard this one before, but this is my favorite 80-20 story. I have a friend named John Paul [inaudible 00:10:15] who dropped out of high school when he was 17, and he hitchhiked from Denver to Las Vegas with a couple of gambling books under his arm, and he’s like, “I’m gonna become a professional gambler.” He starts going to casinos and playing poker every day and living by his whits at age 17. And after a few weeks of this he was like, “Dang. This is harder than I thought.” He bumps into this guy who runs a gambling ring named Rob, and he starts talking to him. And he says, “Well, could you teach me how to do this?” And Rob says, “For a percentage of your winnings I could teach you how to do this.” And so they shake on it.

And after they do that, “Hey, jump in the jeep, John. We’re going for a ride.” So they get in the car, and they’re going down the highway, and John says, “Okay. So how do I win more poker games?” And Rob goes, “You have to play people who are going to lose. And those people are called marks, and you need to find the marks in the room, and you need to play poker with them, and you don’t play poker with anybody else.” And he says, “Well, how do I find the marks?” And he says, “Here. I’ll show you.” And he pulls into a parking lot of a strip club, and they go in there. And there’s women and there’s rock and roll, and there’s people drinking and all this commotion and noise in there.

And he sits down at the table, and Rob pulls a sawed off shotgun out of his jacket. And he opens the chamber, and under the table, then he snaps it shut and it goes “chitch.” And all these guys look around. And John sees them. And the owner come over, and he says, “Hey, what’s going on over here?” And Rob goes, “Hey, we’re just fine. There’s no problem here. We’re just teaching the lad a lesson, not gonna cause any trouble. Don’t worry about us.” And then Rob turns to John and he says, “John, did you see those guys who turned around when I made that noise?” And he’s like, “Yeah. Those biker guys over there?” “Yeah, those guys.” And John goes, “Yeah.” And he says, “Don’t play poker with them. They’re not marks. Play poker with everybody else.”

Now, that was what I call racking the shotgun, and everything you do in marketing is rack the shotgun. In fact, I’ve trained my customers and clients to use that phrase all the time. Rack the shotgun is when you … You know who racks the shotgun all the time is Donald Trump, okay? Now, I’m not saying he does it for good reasons or whatever. I’m not making any statements about any of that, but he does it. Okay? And he gets a response. Now, what I have always found out is most people are instinctively afraid to rack the shotgun. They’re afraid to find out the truth. They’re afraid to go make that big noise out there and see, “Okay, who’s gonna turn their head and who’s gonna ignore?” Or, “Who’s gonna say no and who’s gonna say yes.”

I mean, it could even go all the way down to your teenager like, “Well, you know, I don’t want to … She came in at 2:30 in the morning last night, and I don’t really want to ruffle any feathers, and we seem to be getting” … Well, that’s like being afraid to rack the shotgun. Like, well, if you don’t know why your teenager came in at 2:30 in the morning, then whatever the reason is is probably not a good one, right? But you have to ask.

John Jantsch: Ignorance is bliss, right? Yeah.

Perry Marshall: I talked to a guy about … He owned a smoothie store, and he was doing all this Facebook and social media stuff, and I’d go, “Well, do you ever send them emails?” He goes, “No, I’m afraid of them unsubscribing.” Well, that’s racking the shotgun, man. I said, “Email is 10 times better than social media. You’re not emailing, because you’re afraid some people won’t like it? Send them an email. Let them unsubscribe. It’s fine.” In fact, if you’re unsubscribe rate is less than 5% or even 10, you’re probably not selling hard enough. So everything you do, everything you do in marketing is racking the shotgun.

John Jantsch: So what you’re, again, coming back to my original question on that, what you’re suggesting is that’s how you’re gonna find the leverage?

Perry Marshall: Yeah. With people, right, you’re gonna find that most people actually aren’t gonna respond to anything that you do. They’re never gonna buy, okay? And maybe it’s 80% aren’t gonna buy or maybe it’s 60% or maybe it’s 95% aren’t gonna buy. But there is a rack the shotgun just with buying. Now, the interesting part about 80-20 is that if you rack a shotgun, and you get, let’s call it $100 shotgun. It’s a $100 transaction, let’s say, and you get 100 people to respond. Well, if you quadruple the price, if you rack a $400 shotgun, 20% of those people will respond again. And if you rack a $1,600 shotgun, 20% of those people will respond again. If you rack a $6,400 shotgun, 20% of those people will respond again. And so you’ll find that even though you started with only 100 people, let’s say, who would spend $100, you might find one person who would spend $50,000. And you didn’t know it, and that person was already there. That person is already in your audience. And what I am seeing is that all of this is becoming more pronounced than it used to be.

John Jantsch: So it really, I mean, again, one of the sort of core principles was you build a business, you got customers. You need to be trying to sell them more. I mean, essentially you’re saying that, but maybe at a level people haven’t considered, that not just is there an opportunity to maybe sell more, but that there is a sort of almost mathematical equation that says what you should you sell them and how much it should cost and who’s gonna respond?

Perry Marshall: That’s right. There is a hunger in the marketplace that there’s a small percentage of people who they have an extreme itch that they would like to scratch. And it’s almost unscratchable. When it’s just your product line, there’s some other things I want to get into, but let’s just restrict it to your product line right now. So 80-20 says, “If I have a Starbucks, and a thousand a people a month are buying a $5 latte, one of those people will buy a $2,700 gleaming stainless steel espresso machine.” And it’s just about a law of physics. Now, I started to notice something really interesting when I started teaching Google AdWords. I wrote the world’s best selling books on Google and Facebook advertising, and all of a sudden when AdWords came into existence, all of these new businesses that might not have even been able to exist before suddenly popped up.

And it was this giant feeding frenzy and gold rush. And what I noticed was that if somebody could get to the top in AdWords, they could get the number one position, which gets the most traffic. And then if they could streamline all the stuff in their website, the shopping cart, the sales pages, the landing pages, the offer, the unique selling proposition, if they could dial all that in and test it to the hilt, they would get to a point where nobody could shove them out of the way. They’re number one, they might be number on TV, and they might not be number one on the radio, and they might not be number one on main street, but if they’re number one in Google AdWords, and if they got their sales machine dialed in, they’re almost unstoppable.

Now, here’s why this was. It was because number two, number three, number four, number five, they all have to test their way to success, and they have to experimentally find what works, but you’re already getting more traffic than they are, and you can already do more tests than they are. And so you’re previous success greases the skids for you to continue to be successful, because you’re the incumbent. Well, I’ve been watching very carefully, and what I’ve seen is that an incumbent in the brick and mortar world is 80-20, but an incumbent in the digital world is 95-5. So here’s an example of this. You could go ask your 10-year-old kid, “Can you name a dozen car manufacturers?” And any 10-year-old kid could think of a dozen, Ferrari and Toyota and Kia. They could come up with a list. But can anybody name 12 search engines or 12 auction sites or 12 bookstores where you can buy any book?

John Jantsch: Well, I don’t know about you, but I have the top 100 search engines that every business should be in sitting right here next to me. I’m being facetious, of course, but remember when people used to talk about that.

Perry Marshall: Right. Right. And they all got washed out. Well, that’s because the internet is frictionless. So making cars, that’s friction all the way. Whether you go to the Toyota dealership or the Ford dealership, you have to drive across town, right? Okay. And so that supports there being 12 different car manufacturers. But if it’s Bing versus Google, there’s literally no difference whether you type in B-I-N-G or G-O-O-G-L-E on your browser. The only thing that makes a difference is how much you enjoy the experience. If Google is 10% better, then pretty soon everybody’s gonna use Google, and the Google’s gonna become 1,000% better, because they have more data and more customers and more bells and whistles and more everything. And pretty soon Bing doesn’t really have a chance.

And, see, everything in online marketing is like this. Basically, you’re either number one or you’re nobody. And I don’t think most people have really gotten this that this has happened. You’re either number one or you’re nothing. So that old phrase being a category of one, oh, it’s dead serious no. In a 95-5 world you have to be the number one. Whatever you do, you have to be the only one or you are hamburger.

John Jantsch: I think you can see that at a very real level for the local plumber, for example. I mean, all the searches are being done on a mobile device, and Google is determining, “Here’s the three positions that they’re gonna show.” And certainly if you don’t show up in those three, and as you suggest maybe number one of those three, you really don’t exist, I think. And so the digital world is even cutting into the world of friction.

Perry Marshall: It is.

John Jantsch: We may see a day when there’s only one car sale search engine, and the manufacturers are really, I think, playing basically to be there.

Perry Marshall: So I’ll make a prediction right now is that 10 years from now self-driving cars will be extremely common, and half of the auto manufacturers will either be out of business or bought out by the winners.

John Jantsch: Yeah. Yeah, because to some extent the brand won’t matter anymore.

Perry Marshall: No. It won’t. So watch out. Now, if you know this, if you know this, you can make predictions about the future. In many cases if you project 10 years in the future, if you are already pretty much know who the winner is, then you can bet on the winner, and you’ll gain. If there’s somebody out there … I don’t know. I don’t know who it might be, but if somebody out there already pretty much knows who’s gonna control the self-driving car thing, then you buy stock in that company. In 10 years from now you’ll be happy about it, because there probably isn’t that much that anybody can do even right now to change it. To give you another idea, there’s Bitcoin and there’s Ethereum, and there’s all these other little cryptocurrencies. Bitcoin already won. All the rest of them, that’s like .net, .cc, .name, .whatever. It’s just like domain names. They’ll have their little day in the sun and people will think. Bitcoin’s already won. It’s the winner-take-all phenomenon is on steroids.

John Jantsch:  I’m trying to figure out which direction to take this, because there’s so many we can go, and we’re really already out of time. So let me ask you how somebody would … And I’m trying to, again, end it on a really practical note. How would somebody apply this to an existing business? I can see a lot of people thinking, “Okay. If I could figure out this thing and predict the future, and I’ll create a business around that.” But how could somebody apply this? I mean, is this something that you have to have an epiphany? Or is this something that you have to just go out and start testing things in a certain way?

Perry Marshall: So here’s what you can do, and this is extremely practical. Richard [inaudible 00:26:29] and I put together this website called StarPrinciple.com. It’s free, and you can go click a dozen radio buttons and score your business. Basically it tells you how likely it is that you can dominate the niche that you’re in right now. It’s kind of a truth serum of this winner-take-all thing. So the score goes from zero to 200 points, and anything over 100 points is a home run. Okay? Now, some businesses will get a 25, and some will get a 75, and some will get 150. If you’re 150, man, you’re good, and you should pour on the gas. Well, so here’s what you do. Most of our businesses are really three or four businesses or three or four product lines or three or four markets, and they’re all kind of one umbrella. Here’s what you need to do. This could save somebody years of heartache and frustration right here. Okay?

You go, “All right. Well, I have product A, B, C, D. I have market A, B, C, D.” You score each one individually, because in one of your markets you’re really the number six player. In one of your markets you’re the number one player. One market is shrinking, and one market is growing. And you score that. And you break it up, and you need to figure out which part of my business do I pour the gas on and which part do I really just kind of ignore or I let coast? Right? Just give it as little gas I can get away with while I build the others, because 20% of your business is gonna produce 80% of the growth in the future, and the rest of it’s just gonna waste your time.

I think a lot of us aren’t really honest with ourselves about where our business is actually at and what it can really produce, and you need to be the winner. There is probably some part of your market where if you’re like, “Well, this part of the market isn’t very well served right now. Nobody else is really truly paying attention to this aspect, and I could totally nail it. And if I really put my resources into it, I could emerge as the absolute dominant player within six or 12 months,” and that’s what you should do.

John Jantsch: Visiting with Perry Marshal. We’re talking about the 80-20 principle, which is now 95-5 online. Winner take all is the game that we’re playing. Perry, thanks so much for joining us. Where can people find probably the best place to plug in to your, kind of, vast universe?

Perry Marshall: You can go to http://ift.tt/1TMHaKs. And just start by reading 80-20 in sales and marketing and just know that it’s even more true now than it was in 2013 when I wrote it. And the race is on. The race is on. It’s winner take it all, and whatever it is that you do, you need to find the thing where you can be number one, and you can totally dominate and be a category of one, because all..

http://ift.tt/2iF42kB

#Transcript of Unlocking the Power of 80/20

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Transcript of Unlocking the Power of 80/20

Transcript of Unlocking the Power of 80/20

Transcript of Unlocking the Power of 80/20 written by John Jantsch read more at Duct Tape Marketing

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John Jantsch: Hello and welcome to another episode of the Duct Tape Marketing Podcast. This is your host, John Jantsch, and my guest today is Perry Marshall. He’s an online marketing strategist, entrepreneur, and author of numerous books, including one we’re gonna talk about today, the 80-20 of sales and marketing. So, Perry, thanks for joining me.

Perry Marshall: John, it’s great to be here. It was great to be at your summit a couple of years ago where I met a lot of your people. The world just seems to be getting more and more eccentric, and there’s a lot for us to talk about today. Man, you’re either harnessing the eccentricity, or it’s pounding you on the back of the head with a two by four. And there’s not much in the middle, so very timely.

John Jantsch: Let’s get kind of a baseline. I mean, everybody’s heard the 80-20 thing. It’s almost become cliché how people apply it. But I don’t know that that many people, and this is your contention with the book, that many people get the leverage that it provides at a business level, do they?

Perry Marshall: No. First off, it’s not just a business rule of thumb. It’s a fact of nature. And, in fact, if I go to the beach with a bucket, and I pull out a bucket of sand, the sizes of the sand grains is gonna be 80-20. And how much water is in all the rivers is 80-20. The dirt on your carpet is 80-20, and the files in your hard drive. Okay? That’s the first thing. The second thing is that there’s an 80-20 inside every 80-20. When people really get this, it kind of flips them out. And so I can run a spreadsheet or a sales report of all my customers, and if I sort it from top to bottom, 20% of my customers are gonna generate 80% of the sales, but then if I chop off the bottom 80% that only produces 20%, whatever’s left, that top 20%, it’s still 80-20.

And I can do that again. And 4% of my customers are 64% of my business. And then I could do it again, and 1% of the customers are 50%. Well, this is true in almost any part of your business, and we’ll get into that. But then there’s a third thing. And this is probably a little bit new to most people, but the world is really becoming much more 95-5 where 5% of your efforts or your customers produce 95% of your results, and the other 95% only produces 5%. And this is especially true online. I’ve been watching this develop. People really need to understand this. The world is not … Cause and effect in the world operate fundamentally different than they did even 15 years ago. And I don’t think most people have gotten the memo. There’s a lot of examples of this out there.

John Jantsch: Let me stop you there, because I want to clarify something. And we’ll get, obviously, into examples, and I want to go back to the nature comment.

Perry Marshall: Yes.

John Jantsch: But it’s the simple kind of no-brainer lesson, then, to say, “Look, 95%” or if we want to use 80-20, still, to not scare too many people, is 80% of what you’re doing a waste of your time almost? I mean, especially when you get 95-5. It’s like 95% of my effort is on 5%? Quit doing that?

Perry Marshall: Well, yeah or almost, okay? You’ll always find that there’s a bunch of those things that somebody’s gotta do. It might not be you. It shouldn’t be you, but it’s gotta be somebody. But for example, 80 to 95% of all businesses fail or most entrepreneurs, we have all these little projects that we get into, and the project is a miniature little business, truth be told. Even if we didn’t go form an LLC or something. But actually anywhere from four-fifths to nine-tenths of those really don’t produce anything at the end of the day. And what’s happening in the world is that there’s more and more people kind of getting nowhere or just treading water or altogether losing, and then there’s this minority of people that are just absolutely slamming the ball out of the park, like it’s a triple. It’s a home run and then some. There’s less and less that’s in the middle. And so I think people today have to be more ruthless about how they spend their time than they’ve ever been before. There’s never been a time when busy work would get you less far than it does right now.

John Jantsch: And there’s probably never been more busy work.

Perry Marshall: Oh my gah. Yeah. Like, amazing amounts of busy work, and it doesn’t even look like busy work on the surface. You have to be really discerning. Lots of things, they just sound like good ideas, and a lot of them are based on, well, it’s really what was working in 2003, and it’s not really based on what’s going on right now. So I am issuing a wake up call.

John Jantsch: So let me go back to the nature comment about the grains of sand on the beach or all the things you cited from nature. I mean, is there some sort of principle that suggests why that’s the case?

Perry Marshall: Yes. Yes, and I’m not gonna get super theoretical. I could go into all kinds of stuff about chaos theory. This is really what it’s based on. But, John, I just want you to imagine that we put a table in the middle of your living room, and we went to some machine shop, and we machined the top of that table to be absolutely flat to within 100,000th of an inch, and it was a mirror finish. But then I want you to imagine that there’s a leak in your roof, and now we’re gonna drip water on that table, and the water is gonna drip into the middle of the table. So here’s a question of, “If I have the table perfectly level, and it’s perfectly flat, does that mean that the water is going to evenly spread out on the table, and then drip off the edge of the table in a smooth-flowing stream?

John Jantsch: My guess is it would probably gather as much energy to spread itself out in a very small section of where it landed.

Perry Marshall: Well, right. Right. And what would happen is no matter how flat you try to make that table, it’s gonna be a little bit easier for the water to go in one direction than the other ones, and then it starts going. And once it starts going, well, the erosion will wear, and then a million years later, there’s gonna be this big giant groove in the middle of your table that started out as flat. There’s nothing you could do to make the water flow equally. And here’s the thing is everything in life and nature is like that. So how water erodes or, for example, you’ve 10 14-year-old kids yesterday tried Jack Daniels for the first time. And maybe they all sort of liked it. But one of them liked it a little more than the rest of them, and so 30 years from now the rest of them all take a drink a week or two drinks a week and one of them has five drinks before breakfast, and he’s an alcoholic.

Okay? So your customers are like that. And my customers are like that. Everything is unequal. And the thing is is education conditions treat everything like it’s equal, treat everybody like they’re equal. The teachers try to make all the kids equal. Well, I just want everybody to get A’s and B’s. It’s like, “Well, they’re not going to.” And so entrepreneurs harness the eccentricities where a lot of more ivory tower people, they kind of try to pretend they’re not there. And so you have to just completely reverse the normal way that you think.

John Jantsch: Okay. So for that person out there that’s thinking, “Where in the world is this going and why is this gonna apply to my business?” Let’s bring it back to something very practical inside a business. How could somebody start spotting that 95% opportunity?

Perry Marshall: Let me tell you a story, and maybe a couple of your people have heard this one before, but this is my favorite 80-20 story. I have a friend named John Paul [inaudible 00:10:15] who dropped out of high school when he was 17, and he hitchhiked from Denver to Las Vegas with a couple of gambling books under his arm, and he’s like, “I’m gonna become a professional gambler.” He starts going to casinos and playing poker every day and living by his whits at age 17. And after a few weeks of this he was like, “Dang. This is harder than I thought.” He bumps into this guy who runs a gambling ring named Rob, and he starts talking to him. And he says, “Well, could you teach me how to do this?” And Rob says, “For a percentage of your winnings I could teach you how to do this.” And so they shake on it.

And after they do that, “Hey, jump in the jeep, John. We’re going for a ride.” So they get in the car, and they’re going down the highway, and John says, “Okay. So how do I win more poker games?” And Rob goes, “You have to play people who are going to lose. And those people are called marks, and you need to find the marks in the room, and you need to play poker with them, and you don’t play poker with anybody else.” And he says, “Well, how do I find the marks?” And he says, “Here. I’ll show you.” And he pulls into a parking lot of a strip club, and they go in there. And there’s women and there’s rock and roll, and there’s people drinking and all this commotion and noise in there.

And he sits down at the table, and Rob pulls a sawed off shotgun out of his jacket. And he opens the chamber, and under the table, then he snaps it shut and it goes “chitch.” And all these guys look around. And John sees them. And the owner come over, and he says, “Hey, what’s going on over here?” And Rob goes, “Hey, we’re just fine. There’s no problem here. We’re just teaching the lad a lesson, not gonna cause any trouble. Don’t worry about us.” And then Rob turns to John and he says, “John, did you see those guys who turned around when I made that noise?” And he’s like, “Yeah. Those biker guys over there?” “Yeah, those guys.” And John goes, “Yeah.” And he says, “Don’t play poker with them. They’re not marks. Play poker with everybody else.”

Now, that was what I call racking the shotgun, and everything you do in marketing is rack the shotgun. In fact, I’ve trained my customers and clients to use that phrase all the time. Rack the shotgun is when you … You know who racks the shotgun all the time is Donald Trump, okay? Now, I’m not saying he does it for good reasons or whatever. I’m not making any statements about any of that, but he does it. Okay? And he gets a response. Now, what I have always found out is most people are instinctively afraid to rack the shotgun. They’re afraid to find out the truth. They’re afraid to go make that big noise out there and see, “Okay, who’s gonna turn their head and who’s gonna ignore?” Or, “Who’s gonna say no and who’s gonna say yes.”

I mean, it could even go all the way down to your teenager like, “Well, you know, I don’t want to … She came in at 2:30 in the morning last night, and I don’t really want to ruffle any feathers, and we seem to be getting” … Well, that’s like being afraid to rack the shotgun. Like, well, if you don’t know why your teenager came in at 2:30 in the morning, then whatever the reason is is probably not a good one, right? But you have to ask.

John Jantsch: Ignorance is bliss, right? Yeah.

Perry Marshall: I talked to a guy about … He owned a smoothie store, and he was doing all this Facebook and social media stuff, and I’d go, “Well, do you ever send them emails?” He goes, “No, I’m afraid of them unsubscribing.” Well, that’s racking the shotgun, man. I said, “Email is 10 times better than social media. You’re not emailing, because you’re afraid some people won’t like it? Send them an email. Let them unsubscribe. It’s fine.” In fact, if you’re unsubscribe rate is less than 5% or even 10, you’re probably not selling hard enough. So everything you do, everything you do in marketing is racking the shotgun.

John Jantsch: So what you’re, again, coming back to my original question on that, what you’re suggesting is that’s how you’re gonna find the leverage?

Perry Marshall: Yeah. With people, right, you’re gonna find that most people actually aren’t gonna respond to anything that you do. They’re never gonna buy, okay? And maybe it’s 80% aren’t gonna buy or maybe it’s 60% or maybe it’s 95% aren’t gonna buy. But there is a rack the shotgun just with buying. Now, the interesting part about 80-20 is that if you rack a shotgun, and you get, let’s call it $100 shotgun. It’s a $100 transaction, let’s say, and you get 100 people to respond. Well, if you quadruple the price, if you rack a $400 shotgun, 20% of those people will respond again. And if you rack a $1,600 shotgun, 20% of those people will respond again. If you rack a $6,400 shotgun, 20% of those people will respond again. And so you’ll find that even though you started with only 100 people, let’s say, who would spend $100, you might find one person who would spend $50,000. And you didn’t know it, and that person was already there. That person is already in your audience. And what I am seeing is that all of this is becoming more pronounced than it used to be.

John Jantsch: So it really, I mean, again, one of the sort of core principles was you build a business, you got customers. You need to be trying to sell them more. I mean, essentially you’re saying that, but maybe at a level people haven’t considered, that not just is there an opportunity to maybe sell more, but that there is a sort of almost mathematical equation that says what you should you sell them and how much it should cost and who’s gonna respond?

Perry Marshall: That’s right. There is a hunger in the marketplace that there’s a small percentage of people who they have an extreme itch that they would like to scratch. And it’s almost unscratchable. When it’s just your product line, there’s some other things I want to get into, but let’s just restrict it to your product line right now. So 80-20 says, “If I have a Starbucks, and a thousand a people a month are buying a $5 latte, one of those people will buy a $2,700 gleaming stainless steel espresso machine.” And it’s just about a law of physics. Now, I started to notice something really interesting when I started teaching Google AdWords. I wrote the world’s best selling books on Google and Facebook advertising, and all of a sudden when AdWords came into existence, all of these new businesses that might not have even been able to exist before suddenly popped up.

And it was this giant feeding frenzy and gold rush. And what I noticed was that if somebody could get to the top in AdWords, they could get the number one position, which gets the most traffic. And then if they could streamline all the stuff in their website, the shopping cart, the sales pages, the landing pages, the offer, the unique selling proposition, if they could dial all that in and test it to the hilt, they would get to a point where nobody could shove them out of the way. They’re number one, they might be number on TV, and they might not be number one on the radio, and they might not be number one on main street, but if they’re number one in Google AdWords, and if they got their sales machine dialed in, they’re almost unstoppable.

Now, here’s why this was. It was because number two, number three, number four, number five, they all have to test their way to success, and they have to experimentally find what works, but you’re already getting more traffic than they are, and you can already do more tests than they are. And so you’re previous success greases the skids for you to continue to be successful, because you’re the incumbent. Well, I’ve been watching very carefully, and what I’ve seen is that an incumbent in the brick and mortar world is 80-20, but an incumbent in the digital world is 95-5. So here’s an example of this. You could go ask your 10-year-old kid, “Can you name a dozen car manufacturers?” And any 10-year-old kid could think of a dozen, Ferrari and Toyota and Kia. They could come up with a list. But can anybody name 12 search engines or 12 auction sites or 12 bookstores where you can buy any book?

John Jantsch: Well, I don’t know about you, but I have the top 100 search engines that every business should be in sitting right here next to me. I’m being facetious, of course, but remember when people used to talk about that.

Perry Marshall: Right. Right. And they all got washed out. Well, that’s because the internet is frictionless. So making cars, that’s friction all the way. Whether you go to the Toyota dealership or the Ford dealership, you have to drive across town, right? Okay. And so that supports there being 12 different car manufacturers. But if it’s Bing versus Google, there’s literally no difference whether you type in B-I-N-G or G-O-O-G-L-E on your browser. The only thing that makes a difference is how much you enjoy the experience. If Google is 10% better, then pretty soon everybody’s gonna use Google, and the Google’s gonna become 1,000% better, because they have more data and more customers and more bells and whistles and more everything. And pretty soon Bing doesn’t really have a chance.

And, see, everything in online marketing is like this. Basically, you’re either number one or you’re nobody. And I don’t think most people have really gotten this that this has happened. You’re either number one or you’re nothing. So that old phrase being a category of one, oh, it’s dead serious no. In a 95-5 world you have to be the number one. Whatever you do, you have to be the only one or you are hamburger.

John Jantsch: I think you can see that at a very real level for the local plumber, for example. I mean, all the searches are being done on a mobile device, and Google is determining, “Here’s the three positions that they’re gonna show.” And certainly if you don’t show up in those three, and as you suggest maybe number one of those three, you really don’t exist, I think. And so the digital world is even cutting into the world of friction.

Perry Marshall: It is.

John Jantsch: We may see a day when there’s only one car sale search engine, and the manufacturers are really, I think, playing basically to be there.

Perry Marshall: So I’ll make a prediction right now is that 10 years from now self-driving cars will be extremely common, and half of the auto manufacturers will either be out of business or bought out by the winners.

John Jantsch: Yeah. Yeah, because to some extent the brand won’t matter anymore.

Perry Marshall: No. It won’t. So watch out. Now, if you know this, if you know this, you can make predictions about the future. In many cases if you project 10 years in the future, if you are already pretty much know who the winner is, then you can bet on the winner, and you’ll gain. If there’s somebody out there … I don’t know. I don’t know who it might be, but if somebody out there already pretty much knows who’s gonna control the self-driving car thing, then you buy stock in that company. In 10 years from now you’ll be happy about it, because there probably isn’t that much that anybody can do even right now to change it. To give you another idea, there’s Bitcoin and there’s Ethereum, and there’s all these other little cryptocurrencies. Bitcoin already won. All the rest of them, that’s like .net, .cc, .name, .whatever. It’s just like domain names. They’ll have their little day in the sun and people will think. Bitcoin’s already won. It’s the winner-take-all phenomenon is on steroids.

John Jantsch:  I’m trying to figure out which direction to take this, because there’s so many we can go, and we’re really already out of time. So let me ask you how somebody would … And I’m trying to, again, end it on a really practical note. How would somebody apply this to an existing business? I can see a lot of people thinking, “Okay. If I could figure out this thing and predict the future, and I’ll create a business around that.” But how could somebody apply this? I mean, is this something that you have to have an epiphany? Or is this something that you have to just go out and start testing things in a certain way?

Perry Marshall: So here’s what you can do, and this is extremely practical. Richard [inaudible 00:26:29] and I put together this website called StarPrinciple.com. It’s free, and you can go click a dozen radio buttons and score your business. Basically it tells you how likely it is that you can dominate the niche that you’re in right now. It’s kind of a truth serum of this winner-take-all thing. So the score goes from zero to 200 points, and anything over 100 points is a home run. Okay? Now, some businesses will get a 25, and some will get a 75, and some will get 150. If you’re 150, man, you’re good, and you should pour on the gas. Well, so here’s what you do. Most of our businesses are really three or four businesses or three or four product lines or three or four markets, and they’re all kind of one umbrella. Here’s what you need to do. This could save somebody years of heartache and frustration right here. Okay?

You go, “All right. Well, I have product A, B, C, D. I have market A, B, C, D.” You score each one individually, because in one of your markets you’re really the number six player. In one of your markets you’re the number one player. One market is shrinking, and one market is growing. And you score that. And you break it up, and you need to figure out which part of my business do I pour the gas on and which part do I really just kind of ignore or I let coast? Right? Just give it as little gas I can get away with while I build the others, because 20% of your business is gonna produce 80% of the growth in the future, and the rest of it’s just gonna waste your time.

I think a lot of us aren’t really honest with ourselves about where our business is actually at and what it can really produce, and you need to be the winner. There is probably some part of your market where if you’re like, “Well, this part of the market isn’t very well served right now. Nobody else is really truly paying attention to this aspect, and I could totally nail it. And if I really put my resources into it, I could emerge as the absolute dominant player within six or 12 months,” and that’s what you should do.

John Jantsch: Visiting with Perry Marshal. We’re talking about the 80-20 principle, which is now 95-5 online. Winner take all is the game that we’re playing. Perry, thanks so much for joining us. Where can people find probably the best place to plug in to your, kind of, vast universe?

Perry Marshall: You can go to http://ift.tt/1TMHaKs. And just start by reading 80-20 in sales and marketing and just know that it’s even more true now than it was in 2013 when I wrote it. And the race is on. The race is on. It’s winner take it all, and whatever it is that you do, you need to find the thing where you can be number one, and you can totally dominate and be a category of one, because all..

http://ift.tt/2iF42kB

#Transcript of Unlocking the Power of 80/20

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Transcript of Unlocking the Power of 80/20

Transcript of Unlocking the Power of 80/20

Transcript of Unlocking the Power of 80/20 written by John Jantsch read more at Duct Tape Marketing

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John Jantsch: Hello and welcome to another episode of the Duct Tape Marketing Podcast. This is your host, John Jantsch, and my guest today is Perry Marshall. He’s an online marketing strategist, entrepreneur, and author of numerous books, including one we’re gonna talk about today, the 80-20 of sales and marketing. So, Perry, thanks for joining me.

Perry Marshall: John, it’s great to be here. It was great to be at your summit a couple of years ago where I met a lot of your people. The world just seems to be getting more and more eccentric, and there’s a lot for us to talk about today. Man, you’re either harnessing the eccentricity, or it’s pounding you on the back of the head with a two by four. And there’s not much in the middle, so very timely.

John Jantsch: Let’s get kind of a baseline. I mean, everybody’s heard the 80-20 thing. It’s almost become cliché how people apply it. But I don’t know that that many people, and this is your contention with the book, that many people get the leverage that it provides at a business level, do they?

Perry Marshall: No. First off, it’s not just a business rule of thumb. It’s a fact of nature. And, in fact, if I go to the beach with a bucket, and I pull out a bucket of sand, the sizes of the sand grains is gonna be 80-20. And how much water is in all the rivers is 80-20. The dirt on your carpet is 80-20, and the files in your hard drive. Okay? That’s the first thing. The second thing is that there’s an 80-20 inside every 80-20. When people really get this, it kind of flips them out. And so I can run a spreadsheet or a sales report of all my customers, and if I sort it from top to bottom, 20% of my customers are gonna generate 80% of the sales, but then if I chop off the bottom 80% that only produces 20%, whatever’s left, that top 20%, it’s still 80-20.

And I can do that again. And 4% of my customers are 64% of my business. And then I could do it again, and 1% of the customers are 50%. Well, this is true in almost any part of your business, and we’ll get into that. But then there’s a third thing. And this is probably a little bit new to most people, but the world is really becoming much more 95-5 where 5% of your efforts or your customers produce 95% of your results, and the other 95% only produces 5%. And this is especially true online. I’ve been watching this develop. People really need to understand this. The world is not … Cause and effect in the world operate fundamentally different than they did even 15 years ago. And I don’t think most people have gotten the memo. There’s a lot of examples of this out there.

John Jantsch: Let me stop you there, because I want to clarify something. And we’ll get, obviously, into examples, and I want to go back to the nature comment.

Perry Marshall: Yes.

John Jantsch: But it’s the simple kind of no-brainer lesson, then, to say, “Look, 95%” or if we want to use 80-20, still, to not scare too many people, is 80% of what you’re doing a waste of your time almost? I mean, especially when you get 95-5. It’s like 95% of my effort is on 5%? Quit doing that?

Perry Marshall: Well, yeah or almost, okay? You’ll always find that there’s a bunch of those things that somebody’s gotta do. It might not be you. It shouldn’t be you, but it’s gotta be somebody. But for example, 80 to 95% of all businesses fail or most entrepreneurs, we have all these little projects that we get into, and the project is a miniature little business, truth be told. Even if we didn’t go form an LLC or something. But actually anywhere from four-fifths to nine-tenths of those really don’t produce anything at the end of the day. And what’s happening in the world is that there’s more and more people kind of getting nowhere or just treading water or altogether losing, and then there’s this minority of people that are just absolutely slamming the ball out of the park, like it’s a triple. It’s a home run and then some. There’s less and less that’s in the middle. And so I think people today have to be more ruthless about how they spend their time than they’ve ever been before. There’s never been a time when busy work would get you less far than it does right now.

John Jantsch: And there’s probably never been more busy work.

Perry Marshall: Oh my gah. Yeah. Like, amazing amounts of busy work, and it doesn’t even look like busy work on the surface. You have to be really discerning. Lots of things, they just sound like good ideas, and a lot of them are based on, well, it’s really what was working in 2003, and it’s not really based on what’s going on right now. So I am issuing a wake up call.

John Jantsch: So let me go back to the nature comment about the grains of sand on the beach or all the things you cited from nature. I mean, is there some sort of principle that suggests why that’s the case?

Perry Marshall: Yes. Yes, and I’m not gonna get super theoretical. I could go into all kinds of stuff about chaos theory. This is really what it’s based on. But, John, I just want you to imagine that we put a table in the middle of your living room, and we went to some machine shop, and we machined the top of that table to be absolutely flat to within 100,000th of an inch, and it was a mirror finish. But then I want you to imagine that there’s a leak in your roof, and now we’re gonna drip water on that table, and the water is gonna drip into the middle of the table. So here’s a question of, “If I have the table perfectly level, and it’s perfectly flat, does that mean that the water is going to evenly spread out on the table, and then drip off the edge of the table in a smooth-flowing stream?

John Jantsch: My guess is it would probably gather as much energy to spread itself out in a very small section of where it landed.

Perry Marshall: Well, right. Right. And what would happen is no matter how flat you try to make that table, it’s gonna be a little bit easier for the water to go in one direction than the other ones, and then it starts going. And once it starts going, well, the erosion will wear, and then a million years later, there’s gonna be this big giant groove in the middle of your table that started out as flat. There’s nothing you could do to make the water flow equally. And here’s the thing is everything in life and nature is like that. So how water erodes or, for example, you’ve 10 14-year-old kids yesterday tried Jack Daniels for the first time. And maybe they all sort of liked it. But one of them liked it a little more than the rest of them, and so 30 years from now the rest of them all take a drink a week or two drinks a week and one of them has five drinks before breakfast, and he’s an alcoholic.

Okay? So your customers are like that. And my customers are like that. Everything is unequal. And the thing is is education conditions treat everything like it’s equal, treat everybody like they’re equal. The teachers try to make all the kids equal. Well, I just want everybody to get A’s and B’s. It’s like, “Well, they’re not going to.” And so entrepreneurs harness the eccentricities where a lot of more ivory tower people, they kind of try to pretend they’re not there. And so you have to just completely reverse the normal way that you think.

John Jantsch: Okay. So for that person out there that’s thinking, “Where in the world is this going and why is this gonna apply to my business?” Let’s bring it back to something very practical inside a business. How could somebody start spotting that 95% opportunity?

Perry Marshall: Let me tell you a story, and maybe a couple of your people have heard this one before, but this is my favorite 80-20 story. I have a friend named John Paul [inaudible 00:10:15] who dropped out of high school when he was 17, and he hitchhiked from Denver to Las Vegas with a couple of gambling books under his arm, and he’s like, “I’m gonna become a professional gambler.” He starts going to casinos and playing poker every day and living by his whits at age 17. And after a few weeks of this he was like, “Dang. This is harder than I thought.” He bumps into this guy who runs a gambling ring named Rob, and he starts talking to him. And he says, “Well, could you teach me how to do this?” And Rob says, “For a percentage of your winnings I could teach you how to do this.” And so they shake on it.

And after they do that, “Hey, jump in the jeep, John. We’re going for a ride.” So they get in the car, and they’re going down the highway, and John says, “Okay. So how do I win more poker games?” And Rob goes, “You have to play people who are going to lose. And those people are called marks, and you need to find the marks in the room, and you need to play poker with them, and you don’t play poker with anybody else.” And he says, “Well, how do I find the marks?” And he says, “Here. I’ll show you.” And he pulls into a parking lot of a strip club, and they go in there. And there’s women and there’s rock and roll, and there’s people drinking and all this commotion and noise in there.

And he sits down at the table, and Rob pulls a sawed off shotgun out of his jacket. And he opens the chamber, and under the table, then he snaps it shut and it goes “chitch.” And all these guys look around. And John sees them. And the owner come over, and he says, “Hey, what’s going on over here?” And Rob goes, “Hey, we’re just fine. There’s no problem here. We’re just teaching the lad a lesson, not gonna cause any trouble. Don’t worry about us.” And then Rob turns to John and he says, “John, did you see those guys who turned around when I made that noise?” And he’s like, “Yeah. Those biker guys over there?” “Yeah, those guys.” And John goes, “Yeah.” And he says, “Don’t play poker with them. They’re not marks. Play poker with everybody else.”

Now, that was what I call racking the shotgun, and everything you do in marketing is rack the shotgun. In fact, I’ve trained my customers and clients to use that phrase all the time. Rack the shotgun is when you … You know who racks the shotgun all the time is Donald Trump, okay? Now, I’m not saying he does it for good reasons or whatever. I’m not making any statements about any of that, but he does it. Okay? And he gets a response. Now, what I have always found out is most people are instinctively afraid to rack the shotgun. They’re afraid to find out the truth. They’re afraid to go make that big noise out there and see, “Okay, who’s gonna turn their head and who’s gonna ignore?” Or, “Who’s gonna say no and who’s gonna say yes.”

I mean, it could even go all the way down to your teenager like, “Well, you know, I don’t want to ��� She came in at 2:30 in the morning last night, and I don’t really want to ruffle any feathers, and we seem to be getting” … Well, that’s like being afraid to rack the shotgun. Like, well, if you don’t know why your teenager came in at 2:30 in the morning, then whatever the reason is is probably not a good one, right? But you have to ask.

John Jantsch: Ignorance is bliss, right? Yeah.

Perry Marshall: I talked to a guy about … He owned a smoothie store, and he was doing all this Facebook and social media stuff, and I’d go, “Well, do you ever send them emails?” He goes, “No, I’m afraid of them unsubscribing.” Well, that’s racking the shotgun, man. I said, “Email is 10 times better than social media. You’re not emailing, because you’re afraid some people won’t like it? Send them an email. Let them unsubscribe. It’s fine.” In fact, if you’re unsubscribe rate is less than 5% or even 10, you’re probably not selling hard enough. So everything you do, everything you do in marketing is racking the shotgun.

John Jantsch: So what you’re, again, coming back to my original question on that, what you’re suggesting is that’s how you’re gonna find the leverage?

Perry Marshall: Yeah. With people, right, you’re gonna find that most people actually aren’t gonna respond to anything that you do. They’re never gonna buy, okay? And maybe it’s 80% aren’t gonna buy or maybe it’s 60% or maybe it’s 95% aren’t gonna buy. But there is a rack the shotgun just with buying. Now, the interesting part about 80-20 is that if you rack a shotgun, and you get, let’s call it $100 shotgun. It’s a $100 transaction, let’s say, and you get 100 people to respond. Well, if you quadruple the price, if you rack a $400 shotgun, 20% of those people will respond again. And if you rack a $1,600 shotgun, 20% of those people will respond again. If you rack a $6,400 shotgun, 20% of those people will respond again. And so you’ll find that even though you started with only 100 people, let’s say, who would spend $100, you might find one person who would spend $50,000. And you didn’t know it, and that person was already there. That person is already in your audience. And what I am seeing is that all of this is becoming more pronounced than it used to be.

John Jantsch: So it really, I mean, again, one of the sort of core principles was you build a business, you got customers. You need to be trying to sell them more. I mean, essentially you’re saying that, but maybe at a level people haven’t considered, that not just is there an opportunity to maybe sell more, but that there is a sort of almost mathematical equation that says what you should you sell them and how much it should cost and who’s gonna respond?

Perry Marshall: That’s right. There is a hunger in the marketplace that there’s a small percentage of people who they have an extreme itch that they would like to scratch. And it’s almost unscratchable. When it’s just your product line, there’s some other things I want to get into, but let’s just restrict it to your product line right now. So 80-20 says, “If I have a Starbucks, and a thousand a people a month are buying a $5 latte, one of those people will buy a $2,700 gleaming stainless steel espresso machine.” And it’s just about a law of physics. Now, I started to notice something really interesting when I started teaching Google AdWords. I wrote the world’s best selling books on Google and Facebook advertising, and all of a sudden when AdWords came into existence, all of these new businesses that might not have even been able to exist before suddenly popped up.

And it was this giant feeding frenzy and gold rush. And what I noticed was that if somebody could get to the top in AdWords, they could get the number one position, which gets the most traffic. And then if they could streamline all the stuff in their website, the shopping cart, the sales pages, the landing pages, the offer, the unique selling proposition, if they could dial all that in and test it to the hilt, they would get to a point where nobody could shove them out of the way. They’re number one, they might be number on TV, and they might not be number one on the radio, and they might not be number one on main street, but if they’re number one in Google AdWords, and if they got their sales machine dialed in, they’re almost unstoppable.

Now, here’s why this was. It was because number two, number three, number four, number five, they all have to test their way to success, and they have to experimentally find what works, but you’re already getting more traffic than they are, and you can already do more tests than they are. And so you’re previous success greases the skids for you to continue to be successful, because you’re the incumbent. Well, I’ve been watching very carefully, and what I’ve seen is that an incumbent in the brick and mortar world is 80-20, but an incumbent in the digital world is 95-5. So here’s an example of this. You could go ask your 10-year-old kid, “Can you name a dozen car manufacturers?” And any 10-year-old kid could think of a dozen, Ferrari and Toyota and Kia. They could come up with a list. But can anybody name 12 search engines or 12 auction sites or 12 bookstores where you can buy any book?

John Jantsch: Well, I don’t know about you, but I have the top 100 search engines that every business should be in sitting right here next to me. I’m being facetious, of course, but remember when people used to talk about that.

Perry Marshall: Right. Right. And they all got washed out. Well, that’s because the internet is frictionless. So making cars, that’s friction all the way. Whether you go to the Toyota dealership or the Ford dealership, you have to drive across town, right? Okay. And so that supports there being 12 different car manufacturers. But if it’s Bing versus Google, there’s literally no difference whether you type in B-I-N-G or G-O-O-G-L-E on your browser. The only thing that makes a difference is how much you enjoy the experience. If Google is 10% better, then pretty soon everybody’s gonna use Google, and the Google’s gonna become 1,000% better, because they have more data and more customers and more bells and whistles and more everything. And pretty soon Bing doesn’t really have a chance.

And, see, everything in online marketing is like this. Basically, you’re either number one or you’re nobody. And I don’t think most people have really gotten this that this has happened. You’re either number one or you’re nothing. So that old phrase being a category of one, oh, it’s dead serious no. In a 95-5 world you have to be the number one. Whatever you do, you have to be the only one or you are hamburger.

John Jantsch: I think you can see that at a very real level for the local plumber, for example. I mean, all the searches are being done on a mobile device, and Google is determining, “Here’s the three positions that they’re gonna show.” And certainly if you don’t show up in those three, and as you suggest maybe number one of those three, you really don’t exist, I think. And so the digital world is even cutting into the world of friction.

Perry Marshall: It is.

John Jantsch: We may see a day when there’s only one car sale search engine, and the manufacturers are really, I think, playing basically to be there.

Perry Marshall: So I’ll make a prediction right now is that 10 years from now self-driving cars will be extremely common, and half of the auto manufacturers will either be out of business or bought out by the winners.

John Jantsch: Yeah. Yeah, because to some extent the brand won’t matter anymore.

Perry Marshall: No. It won’t. So watch out. Now, if you know this, if you know this, you can make predictions about the future. In many cases if you project 10 years in the future, if you are already pretty much know who the winner is, then you can bet on the winner, and you’ll gain. If there’s somebody out there … I don’t know. I don’t know who it might be, but if somebody out there already pretty much knows who’s gonna control the self-driving car thing, then you buy stock in that company. In 10 years from now you’ll be happy about it, because there probably isn’t that much that anybody can do even right now to change it. To give you another idea, there’s Bitcoin and there’s Ethereum, and there’s all these other little cryptocurrencies. Bitcoin already won. All the rest of them, that’s like .net, .cc, .name, .whatever. It’s just like domain names. They’ll have their little day in the sun and people will think. Bitcoin’s already won. It’s the winner-take-all phenomenon is on steroids.

John Jantsch:  I’m trying to figure out which direction to take this, because there’s so many we can go, and we’re really already out of time. So let me ask you how somebody would … And I’m trying to, again, end it on a really practical note. How would somebody apply this to an existing business? I can see a lot of people thinking, “Okay. If I could figure out this thing and predict the future, and I’ll create a business around that.” But how could somebody apply this? I mean, is this something that you have to have an epiphany? Or is this something that you have to just go out and start testing things in a certain way?

Perry Marshall: So here’s what you can do, and this is extremely practical. Richard [inaudible 00:26:29] and I put together this website called StarPrinciple.com. It’s free, and you can go click a dozen radio buttons and score your business. Basically it tells you how likely it is that you can dominate the niche that you’re in right now. It’s kind of a truth serum of this winner-take-all thing. So the score goes from zero to 200 points, and anything over 100 points is a home run. Okay? Now, some businesses will get a 25, and some will get a 75, and some will get 150. If you’re 150, man, you’re good, and you should pour on the gas. Well, so here’s what you do. Most of our businesses are really three or four businesses or three or four product lines or three or four markets, and they’re all kind of one umbrella. Here’s what you need to do. This could save somebody years of heartache and frustration right here. Okay?

You go, “All right. Well, I have product A, B, C, D. I have market A, B, C, D.” You score each one individually, because in one of your markets you’re really the number six player. In one of your markets you’re the number one player. One market is shrinking, and one market is growing. And you score that. And you break it up, and you need to figure out which part of my business do I pour the gas on and which part do I really just kind of ignore or I let coast? Right? Just give it as little gas I can get away with while I build the others, because 20% of your business is gonna produce 80% of the growth in the future, and the rest of it’s just gonna waste your time.

I think a lot of us aren’t really honest with ourselves about where our business is actually at and what it can really produce, and you need to be the winner. There is probably some part of your market where if you’re like, “Well, this part of the market isn’t very well served right now. Nobody else is really truly paying attention to this aspect, and I could totally nail it. And if I really put my resources into it, I could emerge as the absolute dominant player within six or 12 months,” and that’s what you should do.

John Jantsch: Visiting with Perry Marshal. We’re talking about the 80-20 principle, which is now 95-5 online. Winner take all is the game that we’re playing. Perry, thanks so much for joining us. Where can people find probably the best place to plug in to your, kind of, vast universe?

Perry Marshall: You can go to http://ift.tt/1TMHaKs. And just start by reading 80-20 in sales and marketing and just know that it’s even more true now than it was in 2013 when I wrote it. And the race is on. The race is on. It’s winner take it all, and whatever it is that you do, you need to find the thing where you can be number one, and you can totally dominate and be a category of one, because all..

http://ift.tt/2iF42kB

#Transcript of Unlocking the Power of 80/20

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Transcript of Unlocking the Power of 80/20

Transcript of Unlocking the Power of 80/20

Transcript of Unlocking the Power of 80/20 written by John Jantsch read more at Duct Tape Marketing

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John Jantsch: Hello and welcome to another episode of the Duct Tape Marketing Podcast. This is your host, John Jantsch, and my guest today is Perry Marshall. He’s an online marketing strategist, entrepreneur, and author of numerous books, including one we’re gonna talk about today, the 80-20 of sales and marketing. So, Perry, thanks for joining me.

Perry Marshall: John, it’s great to be here. It was great to be at your summit a couple of years ago where I met a lot of your people. The world just seems to be getting more and more eccentric, and there’s a lot for us to talk about today. Man, you’re either harnessing the eccentricity, or it’s pounding you on the back of the head with a two by four. And there’s not much in the middle, so very timely.

John Jantsch: Let’s get kind of a baseline. I mean, everybody’s heard the 80-20 thing. It’s almost become cliché how people apply it. But I don’t know that that many people, and this is your contention with the book, that many people get the leverage that it provides at a business level, do they?

Perry Marshall: No. First off, it’s not just a business rule of thumb. It’s a fact of nature. And, in fact, if I go to the beach with a bucket, and I pull out a bucket of sand, the sizes of the sand grains is gonna be 80-20. And how much water is in all the rivers is 80-20. The dirt on your carpet is 80-20, and the files in your hard drive. Okay? That’s the first thing. The second thing is that there’s an 80-20 inside every 80-20. When people really get this, it kind of flips them out. And so I can run a spreadsheet or a sales report of all my customers, and if I sort it from top to bottom, 20% of my customers are gonna generate 80% of the sales, but then if I chop off the bottom 80% that only produces 20%, whatever’s left, that top 20%, it’s still 80-20.

And I can do that again. And 4% of my customers are 64% of my business. And then I could do it again, and 1% of the customers are 50%. Well, this is true in almost any part of your business, and we’ll get into that. But then there’s a third thing. And this is probably a little bit new to most people, but the world is really becoming much more 95-5 where 5% of your efforts or your customers produce 95% of your results, and the other 95% only produces 5%. And this is especially true online. I’ve been watching this develop. People really need to understand this. The world is not … Cause and effect in the world operate fundamentally different than they did even 15 years ago. And I don’t think most people have gotten the memo. There’s a lot of examples of this out there.

John Jantsch: Let me stop you there, because I want to clarify something. And we’ll get, obviously, into examples, and I want to go back to the nature comment.

Perry Marshall: Yes.

John Jantsch: But it’s the simple kind of no-brainer lesson, then, to say, “Look, 95%” or if we want to use 80-20, still, to not scare too many people, is 80% of what you’re doing a waste of your time almost? I mean, especially when you get 95-5. It’s like 95% of my effort is on 5%? Quit doing that?

Perry Marshall: Well, yeah or almost, okay? You’ll always find that there’s a bunch of those things that somebody’s gotta do. It might not be you. It shouldn’t be you, but it’s gotta be somebody. But for example, 80 to 95% of all businesses fail or most entrepreneurs, we have all these little projects that we get into, and the project is a miniature little business, truth be told. Even if we didn’t go form an LLC or something. But actually anywhere from four-fifths to nine-tenths of those really don’t produce anything at the end of the day. And what’s happening in the world is that there’s more and more people kind of getting nowhere or just treading water or altogether losing, and then there’s this minority of people that are just absolutely slamming the ball out of the park, like it’s a triple. It’s a home run and then some. There’s less and less that’s in the middle. And so I think people today have to be more ruthless about how they spend their time than they’ve ever been before. There’s never been a time when busy work would get you less far than it does right now.

John Jantsch: And there’s probably never been more busy work.

Perry Marshall: Oh my gah. Yeah. Like, amazing amounts of busy work, and it doesn’t even look like busy work on the surface. You have to be really discerning. Lots of things, they just sound like good ideas, and a lot of them are based on, well, it’s really what was working in 2003, and it’s not really based on what’s going on right now. So I am issuing a wake up call.

John Jantsch: So let me go back to the nature comment about the grains of sand on the beach or all the things you cited from nature. I mean, is there some sort of principle that suggests why that’s the case?

Perry Marshall: Yes. Yes, and I’m not gonna get super theoretical. I could go into all kinds of stuff about chaos theory. This is really what it’s based on. But, John, I just want you to imagine that we put a table in the middle of your living room, and we went to some machine shop, and we machined the top of that table to be absolutely flat to within 100,000th of an inch, and it was a mirror finish. But then I want you to imagine that there’s a leak in your roof, and now we’re gonna drip water on that table, and the water is gonna drip into the middle of the table. So here’s a question of, “If I have the table perfectly level, and it’s perfectly flat, does that mean that the water is going to evenly spread out on the table, and then drip off the edge of the table in a smooth-flowing stream?

John Jantsch: My guess is it would probably gather as much energy to spread itself out in a very small section of where it landed.

Perry Marshall: Well, right. Right. And what would happen is no matter how flat you try to make that table, it’s gonna be a little bit easier for the water to go in one direction than the other ones, and then it starts going. And once it starts going, well, the erosion will wear, and then a million years later, there’s gonna be this big giant groove in the middle of your table that started out as flat. There’s nothing you could do to make the water flow equally. And here’s the thing is everything in life and nature is like that. So how water erodes or, for example, you’ve 10 14-year-old kids yesterday tried Jack Daniels for the first time. And maybe they all sort of liked it. But one of them liked it a little more than the rest of them, and so 30 years from now the rest of them all take a drink a week or two drinks a week and one of them has five drinks before breakfast, and he’s an alcoholic.

Okay? So your customers are like that. And my customers are like that. Everything is unequal. And the thing is is education conditions treat everything like it’s equal, treat everybody like they’re equal. The teachers try to make all the kids equal. Well, I just want everybody to get A’s and B’s. It’s like, “Well, they’re not going to.” And so entrepreneurs harness the eccentricities where a lot of more ivory tower people, they kind of try to pretend they’re not there. And so you have to just completely reverse the normal way that you think.

John Jantsch: Okay. So for that person out there that’s thinking, “Where in the world is this going and why is this gonna apply to my business?” Let’s bring it back to something very practical inside a business. How could somebody start spotting that 95% opportunity?

Perry Marshall: Let me tell you a story, and maybe a couple of your people have heard this one before, but this is my favorite 80-20 story. I have a friend named John Paul [inaudible 00:10:15] who dropped out of high school when he was 17, and he hitchhiked from Denver to Las Vegas with a couple of gambling books under his arm, and he’s like, “I’m gonna become a professional gambler.” He starts going to casinos and playing poker every day and living by his whits at age 17. And after a few weeks of this he was like, “Dang. This is harder than I thought.” He bumps into this guy who runs a gambling ring named Rob, and he starts talking to him. And he says, “Well, could you teach me how to do this?” And Rob says, “For a percentage of your winnings I could teach you how to do this.” And so they shake on it.

And after they do that, “Hey, jump in the jeep, John. We’re going for a ride.” So they get in the car, and they’re going down the highway, and John says, “Okay. So how do I win more poker games?” And Rob goes, “You have to play people who are going to lose. And those people are called marks, and you need to find the marks in the room, and you need to play poker with them, and you don’t play poker with anybody else.” And he says, “Well, how do I find the marks?” And he says, “Here. I’ll show you.” And he pulls into a parking lot of a strip club, and they go in there. And there’s women and there’s rock and roll, and there’s people drinking and all this commotion and noise in there.

And he sits down at the table, and Rob pulls a sawed off shotgun out of his jacket. And he opens the chamber, and under the table, then he snaps it shut and it goes “chitch.” And all these guys look around. And John sees them. And the owner come over, and he says, “Hey, what’s going on over here?” And Rob goes, “Hey, we’re just fine. There’s no problem here. We’re just teaching the lad a lesson, not gonna cause any trouble. Don’t worry about us.” And then Rob turns to John and he says, “John, did you see those guys who turned around when I made that noise?” And he’s like, “Yeah. Those biker guys over there?” “Yeah, those guys.” And John goes, “Yeah.” And he says, “Don’t play poker with them. They’re not marks. Play poker with everybody else.”

Now, that was what I call racking the shotgun, and everything you do in marketing is rack the shotgun. In fact, I’ve trained my customers and clients to use that phrase all the time. Rack the shotgun is when you … You know who racks the shotgun all the time is Donald Trump, okay? Now, I’m not saying he does it for good reasons or whatever. I’m not making any statements about any of that, but he does it. Okay? And he gets a response. Now, what I have always found out is most people are instinctively afraid to rack the shotgun. They’re afraid to find out the truth. They’re afraid to go make that big noise out there and see, “Okay, who’s gonna turn their head and who’s gonna ignore?” Or, “Who’s gonna say no and who’s gonna say yes.”

I mean, it could even go all the way down to your teenager like, “Well, you know, I don’t want to … She came in at 2:30 in the morning last night, and I don’t really want to ruffle any feathers, and we seem to be getting” … Well, that’s like being afraid to rack the shotgun. Like, well, if you don’t know why your teenager came in at 2:30 in the morning, then whatever the reason is is probably not a good one, right? But you have to ask.

John Jantsch: Ignorance is bliss, right? Yeah.

Perry Marshall: I talked to a guy about … He owned a smoothie store, and he was doing all this Facebook and social media stuff, and I’d go, “Well, do you ever send them emails?” He goes, “No, I’m afraid of them unsubscribing.” Well, that’s racking the shotgun, man. I said, “Email is 10 times better than social media. You’re not emailing, because you’re afraid some people won’t like it? Send them an email. Let them unsubscribe. It’s fine.” In fact, if you’re unsubscribe rate is less than 5% or even 10, you’re probably not selling hard enough. So everything you do, everything you do in marketing is racking the shotgun.

John Jantsch: So what you’re, again, coming back to my original question on that, what you’re suggesting is that’s how you’re gonna find the leverage?

Perry Marshall: Yeah. With people, right, you’re gonna find that most people actually aren’t gonna respond to anything that you do. They’re never gonna buy, okay? And maybe it’s 80% aren’t gonna buy or maybe it’s 60% or maybe it’s 95% aren’t gonna buy. But there is a rack the shotgun just with buying. Now, the interesting part about 80-20 is that if you rack a shotgun, and you get, let’s call it $100 shotgun. It’s a $100 transaction, let’s say, and you get 100 people to respond. Well, if you quadruple the price, if you rack a $400 shotgun, 20% of those people will respond again. And if you rack a $1,600 shotgun, 20% of those people will respond again. If you rack a $6,400 shotgun, 20% of those people will respond again. And so you’ll find that even though you started with only 100 people, let’s say, who would spend $100, you might find one person who would spend $50,000. And you didn’t know it, and that person was already there. That person is already in your audience. And what I am seeing is that all of this is becoming more pronounced than it used to be.

John Jantsch: So it really, I mean, again, one of the sort of core principles was you build a business, you got customers. You need to be trying to sell them more. I mean, essentially you’re saying that, but maybe at a level people haven’t considered, that not just is there an opportunity to maybe sell more, but that there is a sort of almost mathematical equation that says what you should you sell them and how much it should cost and who’s gonna respond?

Perry Marshall: That’s right. There is a hunger in the marketplace that there’s a small percentage of people who they have an extreme itch that they would like to scratch. And it’s almost unscratchable. When it’s just your product line, there’s some other things I want to get into, but let’s just restrict it to your product line right now. So 80-20 says, “If I have a Starbucks, and a thousand a people a month are buying a $5 latte, one of those people will buy a $2,700 gleaming stainless steel espresso machine.” And it’s just about a law of physics. Now, I started to notice something really interesting when I started teaching Google AdWords. I wrote the world’s best selling books on Google and Facebook advertising, and all of a sudden when AdWords came into existence, all of these new businesses that might not have even been able to exist before suddenly popped up.

And it was this giant feeding frenzy and gold rush. And what I noticed was that if somebody could get to the top in AdWords, they could get the number one position, which gets the most traffic. And then if they could streamline all the stuff in their website, the shopping cart, the sales pages, the landing pages, the offer, the unique selling proposition, if they could dial all that in and test it to the hilt, they would get to a point where nobody could shove them out of the way. They’re number one, they might be number on TV, and they might not be number one on the radio, and they might not be number one on main street, but if they’re number one in Google AdWords, and if they got their sales machine dialed in, they’re almost unstoppable.

Now, here’s why this was. It was because number two, number three, number four, number five, they all have to test their way to success, and they have to experimentally find what works, but you’re already getting more traffic than they are, and you can already do more tests than they are. And so you’re previous success greases the skids for you to continue to be successful, because you’re the incumbent. Well, I’ve been watching very carefully, and what I’ve seen is that an incumbent in the brick and mortar world is 80-20, but an incumbent in the digital world is 95-5. So here’s an example of this. You could go ask your 10-year-old kid, “Can you name a dozen car manufacturers?” And any 10-year-old kid could think of a dozen, Ferrari and Toyota and Kia. They could come up with a list. But can anybody name 12 search engines or 12 auction sites or 12 bookstores where you can buy any book?

John Jantsch: Well, I don’t know about you, but I have the top 100 search engines that every business should be in sitting right here next to me. I’m being facetious, of course, but remember when people used to talk about that.

Perry Marshall: Right. Right. And they all got washed out. Well, that’s because the internet is frictionless. So making cars, that’s friction all the way. Whether you go to the Toyota dealership or the Ford dealership, you have to drive across town, right? Okay. And so that supports there being 12 different car manufacturers. But if it’s Bing versus Google, there’s literally no difference whether you type in B-I-N-G or G-O-O-G-L-E on your browser. The only thing that makes a difference is how much you enjoy the experience. If Google is 10% better, then pretty soon everybody’s gonna use Google, and the Google’s gonna become 1,000% better, because they have more data and more customers and more bells and whistles and more everything. And pretty soon Bing doesn’t really have a chance.

And, see, everything in online marketing is like this. Basically, you’re either number one or you’re nobody. And I don’t think most people have really gotten this that this has happened. You’re either number one or you’re nothing. So that old phrase being a category of one, oh, it’s dead serious no. In a 95-5 world you have to be the number one. Whatever you do, you have to be the only one or you are hamburger.

John Jantsch: I think you can see that at a very real level for the local plumber, for example. I mean, all the searches are being done on a mobile device, and Google is determining, “Here’s the three positions that they’re gonna show.” And certainly if you don’t show up in those three, and as you suggest maybe number one of those three, you really don’t exist, I think. And so the digital world is even cutting into the world of friction.

Perry Marshall: It is.

John Jantsch: We may see a day when there’s only one car sale search engine, and the manufacturers are really, I think, playing basically to be there.

Perry Marshall: So I’ll make a prediction right now is that 10 years from now self-driving cars will be extremely common, and half of the auto manufacturers will either be out of business or bought out by the winners.

John Jantsch: Yeah. Yeah, because to some extent the brand won’t matter anymore.

Perry Marshall: No. It won’t. So watch out. Now, if you know this, if you know this, you can make predictions about the future. In many cases if you project 10 years in the future, if you are already pretty much know who the winner is, then you can bet on the winner, and you’ll gain. If there’s somebody out there … I don’t know. I don’t know who it might be, but if somebody out there already pretty much knows who’s gonna control the self-driving car thing, then you buy stock in that company. In 10 years from now you’ll be happy about it, because there probably isn’t that much that anybody can do even right now to change it. To give you another idea, there’s Bitcoin and there’s Ethereum, and there’s all these other little cryptocurrencies. Bitcoin already won. All the rest of them, that’s like .net, .cc, .name, .whatever. It’s just like domain names. They’ll have their little day in the sun and people will think. Bitcoin’s already won. It’s the winner-take-all phenomenon is on steroids.

John Jantsch:  I’m trying to figure out which direction to take this, because there’s so many we can go, and we’re really already out of time. So let me ask you how somebody would … And I’m trying to, again, end it on a really practical note. How would somebody apply this to an existing business? I can see a lot of people thinking, “Okay. If I could figure out this thing and predict the future, and I’ll create a business around that.” But how could somebody apply this? I mean, is this something that you have to have an epiphany? Or is this something that you have to just go out and start testing things in a certain way?

Perry Marshall: So here’s what you can do, and this is extremely practical. Richard [inaudible 00:26:29] and I put together this website called StarPrinciple.com. It’s free, and you can go click a dozen radio buttons and score your business. Basically it tells you how likely it is that you can dominate the niche that you’re in right now. It’s kind of a truth serum of this winner-take-all thing. So the score goes from zero to 200 points, and anything over 100 points is a home run. Okay? Now, some businesses will get a 25, and some will get a 75, and some will get 150. If you’re 150, man, you’re good, and you should pour on the gas. Well, so here’s what you do. Most of our businesses are really three or four businesses or three or four product lines or three or four markets, and they’re all kind of one umbrella. Here’s what you need to do. This could save somebody years of heartache and frustration right here. Okay?

You go, “All right. Well, I have product A, B, C, D. I have market A, B, C, D.” You score each one individually, because in one of your markets you’re really the number six player. In one of your markets you’re the number one player. One market is shrinking, and one market is growing. And you score that. And you break it up, and you need to figure out which part of my business do I pour the gas on and which part do I really just kind of ignore or I let coast? Right? Just give it as little gas I can get away with while I build the others, because 20% of your business is gonna produce 80% of the growth in the future, and the rest of it’s just gonna waste your time.

I think a lot of us aren’t really honest with ourselves about where our business is actually at and what it can really produce, and you need to be the winner. There is probably some part of your market where if you’re like, “Well, this part of the market isn’t very well served right now. Nobody else is really truly paying attention to this aspect, and I could totally nail it. And if I really put my resources into it, I could emerge as the absolute dominant player within six or 12 months,” and that’s what you should do.

John Jantsch: Visiting with Perry Marshal. We’re talking about the 80-20 principle, which is now 95-5 online. Winner take all is the game that we’re playing. Perry, thanks so much for joining us. Where can people find probably the best place to plug in to your, kind of, vast universe?

Perry Marshall: You can go to http://ift.tt/1TMHaKs. And just start by reading 80-20 in sales and marketing and just know that it’s even more true now than it was in 2013 when I wrote it. And the race is on. The race is on. It’s winner take it all, and whatever it is that you do, you need to find the thing where you can be number one, and you can totally dominate and be a category of one, because all..

http://ift.tt/2iF42kB

#Transcript of Unlocking the Power of 80/20

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Transcript of Unlocking the Power of 80/20

Transcript of Unlocking the Power of 80/20

Transcript of Unlocking the Power of 80/20 written by John Jantsch read more at Duct Tape Marketing

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John Jantsch: Hello and welcome to another episode of the Duct Tape Marketing Podcast. This is your host, John Jantsch, and my guest today is Perry Marshall. He’s an online marketing strategist, entrepreneur, and author of numerous books, including one we’re gonna talk about today, the 80-20 of sales and marketing. So, Perry, thanks for joining me.

Perry Marshall: John, it’s great to be here. It was great to be at your summit a couple of years ago where I met a lot of your people. The world just seems to be getting more and more eccentric, and there’s a lot for us to talk about today. Man, you’re either harnessing the eccentricity, or it’s pounding you on the back of the head with a two by four. And there’s not much in the middle, so very timely.

John Jantsch: Let’s get kind of a baseline. I mean, everybody’s heard the 80-20 thing. It’s almost become cliché how people apply it. But I don’t know that that many people, and this is your contention with the book, that many people get the leverage that it provides at a business level, do they?

Perry Marshall: No. First off, it’s not just a business rule of thumb. It’s a fact of nature. And, in fact, if I go to the beach with a bucket, and I pull out a bucket of sand, the sizes of the sand grains is gonna be 80-20. And how much water is in all the rivers is 80-20. The dirt on your carpet is 80-20, and the files in your hard drive. Okay? That’s the first thing. The second thing is that there’s an 80-20 inside every 80-20. When people really get this, it kind of flips them out. And so I can run a spreadsheet or a sales report of all my customers, and if I sort it from top to bottom, 20% of my customers are gonna generate 80% of the sales, but then if I chop off the bottom 80% that only produces 20%, whatever’s left, that top 20%, it’s still 80-20.

And I can do that again. And 4% of my customers are 64% of my business. And then I could do it again, and 1% of the customers are 50%. Well, this is true in almost any part of your business, and we’ll get into that. But then there’s a third thing. And this is probably a little bit new to most people, but the world is really becoming much more 95-5 where 5% of your efforts or your customers produce 95% of your results, and the other 95% only produces 5%. And this is especially true online. I’ve been watching this develop. People really need to understand this. The world is not … Cause and effect in the world operate fundamentally different than they did even 15 years ago. And I don’t think most people have gotten the memo. There’s a lot of examples of this out there.

John Jantsch: Let me stop you there, because I want to clarify something. And we’ll get, obviously, into examples, and I want to go back to the nature comment.

Perry Marshall: Yes.

John Jantsch: But it’s the simple kind of no-brainer lesson, then, to say, “Look, 95%” or if we want to use 80-20, still, to not scare too many people, is 80% of what you’re doing a waste of your time almost? I mean, especially when you get 95-5. It’s like 95% of my effort is on 5%? Quit doing that?

Perry Marshall: Well, yeah or almost, okay? You’ll always find that there’s a bunch of those things that somebody’s gotta do. It might not be you. It shouldn’t be you, but it’s gotta be somebody. But for example, 80 to 95% of all businesses fail or most entrepreneurs, we have all these little projects that we get into, and the project is a miniature little business, truth be told. Even if we didn’t go form an LLC or something. But actually anywhere from four-fifths to nine-tenths of those really don’t produce anything at the end of the day. And what’s happening in the world is that there’s more and more people kind of getting nowhere or just treading water or altogether losing, and then there’s this minority of people that are just absolutely slamming the ball out of the park, like it’s a triple. It’s a home run and then some. There’s less and less that’s in the middle. And so I think people today have to be more ruthless about how they spend their time than they’ve ever been before. There’s never been a time when busy work would get you less far than it does right now.

John Jantsch: And there’s probably never been more busy work.

Perry Marshall: Oh my gah. Yeah. Like, amazing amounts of busy work, and it doesn’t even look like busy work on the surface. You have to be really discerning. Lots of things, they just sound like good ideas, and a lot of them are based on, well, it’s really what was working in 2003, and it’s not really based on what’s going on right now. So I am issuing a wake up call.

John Jantsch: So let me go back to the nature comment about the grains of sand on the beach or all the things you cited from nature. I mean, is there some sort of principle that suggests why that’s the case?

Perry Marshall: Yes. Yes, and I’m not gonna get super theoretical. I could go into all kinds of stuff about chaos theory. This is really what it’s based on. But, John, I just want you to imagine that we put a table in the middle of your living room, and we went to some machine shop, and we machined the top of that table to be absolutely flat to within 100,000th of an inch, and it was a mirror finish. But then I want you to imagine that there’s a leak in your roof, and now we’re gonna drip water on that table, and the water is gonna drip into the middle of the table. So here’s a question of, “If I have the table perfectly level, and it’s perfectly flat, does that mean that the water is going to evenly spread out on the table, and then drip off the edge of the table in a smooth-flowing stream?

John Jantsch: My guess is it would probably gather as much energy to spread itself out in a very small section of where it landed.

Perry Marshall: Well, right. Right. And what would happen is no matter how flat you try to make that table, it’s gonna be a little bit easier for the water to go in one direction than the other ones, and then it starts going. And once it starts going, well, the erosion will wear, and then a million years later, there’s gonna be this big giant groove in the middle of your table that started out as flat. There’s nothing you could do to make the water flow equally. And here’s the thing is everything in life and nature is like that. So how water erodes or, for example, you’ve 10 14-year-old kids yesterday tried Jack Daniels for the first time. And maybe they all sort of liked it. But one of them liked it a little more than the rest of them, and so 30 years from now the rest of them all take a drink a week or two drinks a week and one of them has five drinks before breakfast, and he’s an alcoholic.

Okay? So your customers are like that. And my customers are like that. Everything is unequal. And the thing is is education conditions treat everything like it’s equal, treat everybody like they’re equal. The teachers try to make all the kids equal. Well, I just want everybody to get A’s and B’s. It’s like, “Well, they’re not going to.” And so entrepreneurs harness the eccentricities where a lot of more ivory tower people, they kind of try to pretend they’re not there. And so you have to just completely reverse the normal way that you think.

John Jantsch: Okay. So for that person out there that’s thinking, “Where in the world is this going and why is this gonna apply to my business?” Let’s bring it back to something very practical inside a business. How could somebody start spotting that 95% opportunity?

Perry Marshall: Let me tell you a story, and maybe a couple of your people have heard this one before, but this is my favorite 80-20 story. I have a friend named John Paul [inaudible 00:10:15] who dropped out of high school when he was 17, and he hitchhiked from Denver to Las Vegas with a couple of gambling books under his arm, and he’s like, “I’m gonna become a professional gambler.” He starts going to casinos and playing poker every day and living by his whits at age 17. And after a few weeks of this he was like, “Dang. This is harder than I thought.” He bumps into this guy who runs a gambling ring named Rob, and he starts talking to him. And he says, “Well, could you teach me how to do this?” And Rob says, “For a percentage of your winnings I could teach you how to do this.” And so they shake on it.

And after they do that, “Hey, jump in the jeep, John. We’re going for a ride.” So they get in the car, and they’re going down the highway, and John says, “Okay. So how do I win more poker games?” And Rob goes, “You have to play people who are going to lose. And those people are called marks, and you need to find the marks in the room, and you need to play poker with them, and you don’t play poker with anybody else.” And he says, “Well, how do I find the marks?” And he says, “Here. I’ll show you.” And he pulls into a parking lot of a strip club, and they go in there. And there’s women and there’s rock and roll, and there’s people drinking and all this commotion and noise in there.

And he sits down at the table, and Rob pulls a sawed off shotgun out of his jacket. And he opens the chamber, and under the table, then he snaps it shut and it goes “chitch.” And all these guys look around. And John sees them. And the owner come over, and he says, “Hey, what’s going on over here?” And Rob goes, “Hey, we’re just fine. There’s no problem here. We’re just teaching the lad a lesson, not gonna cause any trouble. Don’t worry about us.” And then Rob turns to John and he says, “John, did you see those guys who turned around when I made that noise?” And he’s like, “Yeah. Those biker guys over there?” “Yeah, those guys.” And John goes, “Yeah.” And he says, “Don’t play poker with them. They’re not marks. Play poker with everybody else.”

Now, that was what I call racking the shotgun, and everything you do in marketing is rack the shotgun. In fact, I’ve trained my customers and clients to use that phrase all the time. Rack the shotgun is when you … You know who racks the shotgun all the time is Donald Trump, okay? Now, I’m not saying he does it for good reasons or whatever. I’m not making any statements about any of that, but he does it. Okay? And he gets a response. Now, what I have always found out is most people are instinctively afraid to rack the shotgun. They’re afraid to find out the truth. They’re afraid to go make that big noise out there and see, “Okay, who’s gonna turn their head and who’s gonna ignore?” Or, “Who’s gonna say no and who’s gonna say yes.”

I mean, it could even go all the way down to your teenager like, “Well, you know, I don’t want to … She came in at 2:30 in the morning last night, and I don’t really want to ruffle any feathers, and we seem to be getting” … Well, that’s like being afraid to rack the shotgun. Like, well, if you don’t know why your teenager came in at 2:30 in the morning, then whatever the reason is is probably not a good one, right? But you have to ask.

John Jantsch: Ignorance is bliss, right? Yeah.

Perry Marshall: I talked to a guy about … He owned a smoothie store, and he was doing all this Facebook and social media stuff, and I’d go, “Well, do you ever send them emails?” He goes, “No, I’m afraid of them unsubscribing.” Well, that’s racking the shotgun, man. I said, “Email is 10 times better than social media. You’re not emailing, because you’re afraid some people won’t like it? Send them an email. Let them unsubscribe. It’s fine.” In fact, if you’re unsubscribe rate is less than 5% or even 10, you’re probably not selling hard enough. So everything you do, everything you do in marketing is racking the shotgun.

John Jantsch: So what you’re, again, coming back to my original question on that, what you’re suggesting is that’s how you’re gonna find the leverage?

Perry Marshall: Yeah. With people, right, you’re gonna find that most people actually aren’t gonna respond to anything that you do. They’re never gonna buy, okay? And maybe it’s 80% aren’t gonna buy or maybe it’s 60% or maybe it’s 95% aren’t gonna buy. But there is a rack the shotgun just with buying. Now, the interesting part about 80-20 is that if you rack a shotgun, and you get, let’s call it $100 shotgun. It’s a $100 transaction, let’s say, and you get 100 people to respond. Well, if you quadruple the price, if you rack a $400 shotgun, 20% of those people will respond again. And if you rack a $1,600 shotgun, 20% of those people will respond again. If you rack a $6,400 shotgun, 20% of those people will respond again. And so you’ll find that even though you started with only 100 people, let’s say, who would spend $100, you might find one person who would spend $50,000. And you didn’t know it, and that person was already there. That person is already in your audience. And what I am seeing is that all of this is becoming more pronounced than it used to be.

John Jantsch: So it really, I mean, again, one of the sort of core principles was you build a business, you got customers. You need to be trying to sell them more. I mean, essentially you’re saying that, but maybe at a level people haven’t considered, that not just is there an opportunity to maybe sell more, but that there is a sort of almost mathematical equation that says what you should you sell them and how much it should cost and who’s gonna respond?

Perry Marshall: That’s right. There is a hunger in the marketplace that there’s a small percentage of people who they have an extreme itch that they would like to scratch. And it’s almost unscratchable. When it’s just your product line, there’s some other things I want to get into, but let’s just restrict it to your product line right now. So 80-20 says, “If I have a Starbucks, and a thousand a people a month are buying a $5 latte, one of those people will buy a $2,700 gleaming stainless steel espresso machine.” And it’s just about a law of physics. Now, I started to notice something really interesting when I started teaching Google AdWords. I wrote the world’s best selling books on Google and Facebook advertising, and all of a sudden when AdWords came into existence, all of these new businesses that might not have even been able to exist before suddenly popped up.

And it was this giant feeding frenzy and gold rush. And what I noticed was that if somebody could get to the top in AdWords, they could get the number one position, which gets the most traffic. And then if they could streamline all the stuff in their website, the shopping cart, the sales pages, the landing pages, the offer, the unique selling proposition, if they could dial all that in and test it to the hilt, they would get to a point where nobody could shove them out of the way. They’re number one, they might be number on TV, and they might not be number one on the radio, and they might not be number one on main street, but if they’re number one in Google AdWords, and if they got their sales machine dialed in, they’re almost unstoppable.

Now, here’s why this was. It was because number two, number three, number four, number five, they all have to test their way to success, and they have to experimentally find what works, but you’re already getting more traffic than they are, and you can already do more tests than they are. And so you’re previous success greases the skids for you to continue to be successful, because you’re the incumbent. Well, I’ve been watching very carefully, and what I’ve seen is that an incumbent in the brick and mortar world is 80-20, but an incumbent in the digital world is 95-5. So here’s an example of this. You could go ask your 10-year-old kid, “Can you name a dozen car manufacturers?” And any 10-year-old kid could think of a dozen, Ferrari and Toyota and Kia. They could come up with a list. But can anybody name 12 search engines or 12 auction sites or 12 bookstores where you can buy any book?

John Jantsch: Well, I don’t know about you, but I have the top 100 search engines that every business should be in sitting right here next to me. I’m being facetious, of course, but remember when people used to talk about that.

Perry Marshall: Right. Right. And they all got washed out. Well, that’s because the internet is frictionless. So making cars, that’s friction all the way. Whether you go to the Toyota dealership or the Ford dealership, you have to drive across town, right? Okay. And so that supports there being 12 different car manufacturers. But if it’s Bing versus Google, there’s literally no difference whether you type in B-I-N-G or G-O-O-G-L-E on your browser. The only thing that makes a difference is how much you enjoy the experience. If Google is 10% better, then pretty soon everybody’s gonna use Google, and the Google’s gonna become 1,000% better, because they have more data and more customers and more bells and whistles and more everything. And pretty soon Bing doesn’t really have a chance.

And, see, everything in online marketing is like this. Basically, you’re either number one or you’re nobody. And I don’t think most people have really gotten this that this has happened. You’re either number one or you’re nothing. So that old phrase being a category of one, oh, it’s dead serious no. In a 95-5 world you have to be the number one. Whatever you do, you have to be the only one or you are hamburger.

John Jantsch: I think you can see that at a very real level for the local plumber, for example. I mean, all the searches are being done on a mobile device, and Google is determining, “Here’s the three positions that they’re gonna show.” And certainly if you don’t show up in those three, and as you suggest maybe number one of those three, you really don’t exist, I think. And so the digital world is even cutting into the world of friction.

Perry Marshall: It is.

John Jantsch: We may see a day when there’s only one car sale search engine, and the manufacturers are really, I think, playing basically to be there.

Perry Marshall: So I’ll make a prediction right now is that 10 years from now self-driving cars will be extremely common, and half of the auto manufacturers will either be out of business or bought out by the winners.

John Jantsch: Yeah. Yeah, because to some extent the brand won’t matter anymore.

Perry Marshall: No. It won’t. So watch out. Now, if you know this, if you know this, you can make predictions about the future. In many cases if you project 10 years in the future, if you are already pretty much know who the winner is, then you can bet on the winner, and you’ll gain. If there’s somebody out there … I don’t know. I don’t know who it might be, but if somebody out there already pretty much knows who’s gonna control the self-driving car thing, then you buy stock in that company. In 10 years from now you’ll be happy about it, because there probably isn’t that much that anybody can do even right now to change it. To give you another idea, there’s Bitcoin and there’s Ethereum, and there’s all these other little cryptocurrencies. Bitcoin already won. All the rest of them, that’s like .net, .cc, .name, .whatever. It’s just like domain names. They’ll have their little day in the sun and people will think. Bitcoin’s already won. It’s the winner-take-all phenomenon is on steroids.

John Jantsch:  I’m trying to figure out which direction to take this, because there’s so many we can go, and we’re really already out of time. So let me ask you how somebody would … And I’m trying to, again, end it on a really practical note. How would somebody apply this to an existing business? I can see a lot of people thinking, “Okay. If I could figure out this thing and predict the future, and I’ll create a business around that.” But how could somebody apply this? I mean, is this something that you have to have an epiphany? Or is this something that you have to just go out and start testing things in a certain way?

Perry Marshall: So here’s what you can do, and this is extremely practical. Richard [inaudible 00:26:29] and I put together this website called StarPrinciple.com. It’s free, and you can go click a dozen radio buttons and score your business. Basically it tells you how likely it is that you can dominate the niche that you’re in right now. It’s kind of a truth serum of this winner-take-all thing. So the score goes from zero to 200 points, and anything over 100 points is a home run. Okay? Now, some businesses will get a 25, and some will get a 75, and some will get 150. If you’re 150, man, you’re good, and you should pour on the gas. Well, so here’s what you do. Most of our businesses are really three or four businesses or three or four product lines or three or four markets, and they’re all kind of one umbrella. Here’s what you need to do. This could save somebody years of heartache and frustration right here. Okay?

You go, “All right. Well, I have product A, B, C, D. I have market A, B, C, D.” You score each one individually, because in one of your markets you’re really the number six player. In one of your markets you’re the number one player. One market is shrinking, and one market is growing. And you score that. And you break it up, and you need to figure out which part of my business do I pour the gas on and which part do I really just kind of ignore or I let coast? Right? Just give it as little gas I can get away with while I build the others, because 20% of your business is gonna produce 80% of the growth in the future, and the rest of it’s just gonna waste your time.

I think a lot of us aren’t really honest with ourselves about where our business is actually at and what it can really produce, and you need to be the winner. There is probably some part of your market where if you’re like, “Well, this part of the market isn’t very well served right now. Nobody else is really truly paying attention to this aspect, and I could totally nail it. And if I really put my resources into it, I could emerge as the absolute dominant player within six or 12 months,” and that’s what you should do.

John Jantsch: Visiting with Perry Marshal. We’re talking about the 80-20 principle, which is now 95-5 online. Winner take all is the game that we’re playing. Perry, thanks so much for joining us. Where can people find probably the best place to plug in to your, kind of, vast universe?

Perry Marshall: You can go to http://ift.tt/1TMHaKs. And just start by reading 80-20 in sales and marketing and just know that it’s even more true now than it was in 2013 when I wrote it. And the race is on. The race is on. It’s winner take it all, and whatever it is that you do, you need to find the thing where you can be number one, and you can totally dominate and be a category of one, because all..

http://ift.tt/2iF42kB

#Transcript of Unlocking the Power of 80/20