The Offer Is King Ep 185

Summary Notes


In the Gym Secrets podcast, the host emphasizes the power of a compelling offer in driving business growth, outlining that a strong core offer negates the need for hard selling or exceptional marketing. Using examples like Domino's 30-minute delivery guarantee and FedEx's overnight shipping, he underscores the importance of believability, high ROI, and a solid business model in crafting offers. He details seven ethical ways to leverage 'free' to attract customers, including free bribes, limited offers, and free trials with penalties, all aimed at increasing lead volume and customer acquisition while ensuring profitability. The host stresses that knowing how to effectively use free offers gives businesses a competitive edge by allowing them to acquire customers more cheaply and scale with confidence, provided they understand their long-term customer value and conversion metrics.

Summary Notes

Introduction to Gym Secrets Podcast

  • The Gym Secrets podcast focuses on customer acquisition, increasing customer value, and retention in the fitness industry.
  • The host shares their experiences, including failures and lessons learned in the business.

Welcome to the Gym Secrets podcast, where we talk about how to get more customers, how to make more per customer, and how to keep them longer, and the many failures and lessons that we have learned along the way.

This quote introduces the central themes of the podcast, emphasizing the importance of customer-related strategies and learning from past experiences in the fitness business.

The Importance of the Offer

  • A compelling offer is crucial for business growth and does not require hard selling.
  • The core of a business should be an irresistible, exceptional offer.

So if you have a good enough offer, you don't have to sell hard, you don't have to have amazing copy or amazing creative. You just get a lot of people to sign up for your thing.

This quote highlights the significance of a strong offer in attracting customers without needing aggressive sales tactics or high-quality marketing materials.

Three Components of Great Offers

  • The three components that make up great offers are believability, high ROI, and the surrounding business model.
  • Offers must be believable to the customers to be effective.

There's a famous marketer who said, for every dollar you give me, I'll give you a $1,000 back. He ran an ad in the paper and he got zero responses.

This quote illustrates the failure of an unbelievable offer, despite its seemingly high value, due to a lack of credibility.

  • Believability can be enhanced by providing a reasonable explanation for the offer.

If you're like, hey, I'm dropping all my prices by half off because all my inventory is going to go bad. People believe that they're like, okay, or like, I'm overstocked and I got to make room for new inventory. Everything's half off. People believe that. It's a good reason why.

The quote explains how providing a plausible reason for an offer increases its believability and acceptance among consumers.

  • The offer must provide high value that is easily communicated and perceived as valuable by the customer.

You can give offers, but if people don't find it valuable, it's not going to matter.

This quote underlines the necessity for an offer to have perceived value to the customer, regardless of its actual cost or price point.

Examples of Irresistible Offers

  • The success of Domino's Pizza was largely due to their guarantee of delivery within 30 minutes or the pizza was free.
  • Sony's offer of ten CDs for a penny was compelling due to the perceived high value and low cost.
  • FedEx's promise of delivery by the next morning catered to the need for timely delivery, without a direct pricing component.

Some of you guys may remember this, but it was delivered to your door in 30 minutes or it's free, right? That's an irresistible offer. And they had shit pizza. But because of that, people wanted to make the order.

This quote exemplifies how Domino's effectively used a time-based guarantee to overcome product shortcomings, making the offer irresistible.

The next was ten CDs for a penny, right? And this was from, I think it was Sony way back in the day. Now, obviously, it came with continuity, and so that was kind of like the first trial offer. But that offer is one of the single greatest offers of all time for those who are old enough to remember it.

The quote discusses Sony's successful marketing strategy that provided high perceived value and introduced the concept of a trial offer with continuity.

Third offer you may recognize, which is when it absolutely has to get there by tomorrow morning, and that is FedEx.

The quote highlights FedEx's value proposition, which focuses on reliability and timely delivery, positioning their service as essential for urgent needs.

The Value of Free Offers in Marketing

  • Free offers can generate high volume of leads.
  • They typically have the lowest cost to acquire customers.
  • Free offers are seen as key to massive growth, especially if they're irresistible and can spread through word of mouth.

"And so understanding how to use free as a marketer is probably, in my opinion, the single most valuable thing that you can learn how to do."

This quote underlines the significance of free offers in marketing as a strategy to attract customers and grow a business.

Types of Free Offers

Free Bribe Offer

  • A high-value program is offered for free as a benefit for signing up for a paid service.
  • The free offer acts as an incentive to purchase a smaller item but also serves as a price anchor.
  • Example given: Frank Kern's offer of all his courses for free with a $397 monthly subscription.

"So that's a free bribe offer. So you can use the word free, brings lots of attention, has huge value and roi."

The quote explains the concept of a free bribe offer, where the term "free" is used to attract attention and provide significant value and return on investment to the customer.

Limited Free Offer

  • A free offer with limitations, such as a trial period or limited services, designed to upsell to a more comprehensive paid offer.
  • Example given: A gym offering a 28-day trial with limited features, then upselling to a full program with additional benefits like personalized nutrition and accountability coaching.

"So you have an upsell from an initial offer that makes it incredibly compelling."

This quote emphasizes the strategy behind the limited free offer, where an initial free or low-cost service is provided with the intent to upsell customers to a more expensive and comprehensive offer.

Free Trial Plus Penalty

  • A downsell strategy where a free trial is offered with the condition of a penalty if certain terms are not met.
  • This approach involves asking for a credit card upfront to ensure accountability and the potential for conversion to a paid service.

"So if someone doesn't take the AB close that I just mentioned, you can say awesome. If you're going to stay, then you have to put a card down because you want to be held accountable."

The quote describes a scenario where a customer who doesn't initially take an upsell offer is then presented with a free trial that requires a credit card to enforce accountability and facilitate eventual monetization.

Incentivized Participation in Trials

  • Speaker A introduces a system where participants are financially penalized for missing workouts during a trial.
  • This system includes mandatory feedback, transformation picture, and nutrition sessions.
  • The penalty for missing any of these is $50, creating a strong incentive to engage with the product or service.
  • Speaker A suggests that such an approach leads to higher conversion rates post-trial.

"If you miss your workouts, we're going to charge you for the missed workouts, and you have to attend a feedback session and a transformation picture session and a nutrition session." "If, you know, show any of those, it's $50."

The quotes explain the penalty system for trial participants who miss workouts or mandatory sessions, emphasizing the financial motivation to comply and the potential for increased conversions from trials to regular service use.

Importance of Reviews for Podcast Growth

  • Speaker A humorously admonishes listeners who haven't rated or reviewed the show, highlighting the importance of such actions for podcast growth.
  • The growth of the podcast is said to rely on word of mouth, with listener reviews playing a critical role.
  • Speaker A encourages immediate action from listeners to rate or review while continuing to listen to the podcast.

"Hey, if you're a return listener and you have not rated or reviewed the show, I want you to know that you should feel absolutely terrible about yourself and everything else in the world. I'm kidding." "The only way that podcast grows through word of mouth, and this is you joining hands with me and helping as many entrepreneurs as we possibly can, because no one is coming to save us. It's just us."

The quotes underscore the significance of listener engagement through ratings and reviews in the organic growth of the podcast, framing it as a collaborative effort between the host and the audience.

Free with Deposit Model

  • Speaker A describes a "free with deposit" model where participants can get their money back or credit after meeting specific goals.
  • The model is contingent on compliance with certain conditions, which must be clearly stated in advertisements.
  • This approach was exemplified by a popular six-week fitness challenge that Speaker A mentions.

"The fourth one is a free with deposit. So this is a classic. The old six week challenge that we ran for a very long time, it was probably the most popular fitness offer in the last decade, was a free six week challenge." "So it's free with a contingency. So it's like you put x dollars down. If you do X, Y and Z, you can either get it back or you can get it towards program, whatever, right?"

The quotes detail the structure of the "free with deposit" model, explaining how it operates as a conditional offer that incentivizes participants to reach goals to benefit from the deposit they initially paid.

Free Forever Model

  • Speaker A introduces the "free forever" model, which relies on alternative revenue streams.
  • This model offers a primary service for free while requiring purchases of supplementary products.
  • Speaker A cites an example of weight loss clinics that made most of their revenue from selling supplements while offering services for free.
  • The model is based on understanding customer needs and monetizing secondary services or products.

"The fifth way of doing free is free Forever. And this is a really compelling offer." "Your membership is free forever, right? As long as you just do the things that I tell you to do, which may include buying supplements from us."

The quotes explain the "free forever" model, where the primary service is offered for free with the condition that customers purchase other products, which is where the business earns its revenue.

Free Giveaway Strategy

  • Speaker A discusses the use of free giveaways as a marketing strategy.
  • This strategy involves offering something valuable for free, such as meals for a month, to attract a large number of participants.
  • The giveaway is typically limited to one winner, but it serves as a lead generation tool to engage other participants with additional offers.

"The 6th way is a free giveaway. This is a classic." "You run a free giveaway, let's say meals for a month, right? I'll pay for all your food for a month. I'll pay for your whatever, right? And so you get tons of people are going to opt in for that."

The quotes describe the free giveaway approach, highlighting its effectiveness in garnering interest and opt-ins from potential customers, thus serving as a funnel for further marketing initiatives.

High-Value Giveaways as Lead Generation

  • Utilizing high-value giveaways related to the core offer can generate a large number of inexpensive, qualified leads.
  • People demonstrate their need for a service by showing interest in the giveaway.
  • A high perceived value of the giveaway can lead to direct purchases without the need for phone calls or further sales efforts.

"And so if you have a giveaway that's perceived as high value and something that's related to the core offer that you have, you instantly get tons of very cheap leads that are qualified for the service."

This quote emphasizes the effectiveness of high-value giveaways in attracting leads that are already interested in the core service being offered, thereby reducing the cost and effort of lead acquisition.

Transformation Challenges as Marketing Strategies

  • A transformation challenge with a significant reward can entice people to sign up and participate without requiring direct sales interaction.
  • It's important to ensure that these challenges comply with legal regulations and are not considered gambling.
  • These challenges are an example of high-level marketing strategies to engage potential customers.

"A good friend of mine just started running a $25,000 transformation challenge, and he's getting people to buy without even doing phone calls straight on the page because it's a $25,000 challenge and it's like $300 to sign up online."

This quote illustrates a case where a high-reward challenge successfully motivates people to sign up and pay online, bypassing the traditional sales process.

Free Offers with Commitment

  • Offering a free initial period with a commitment to a longer-term contract can effectively convert leads.
  • Marketing a free offer can be compliant with advertising regulations while still requiring a commitment.
  • This strategy relies on fulfilling the service well to retain customers who have committed.

"So that's where you say your first 28 days or your first month is free, as long as you commit to a nine month contract or you commit to a whatever."

The quote outlines a strategy where customers are offered a free initial period in exchange for a commitment to a longer-term contract, which can help in customer acquisition and retention.

Selling Continuity, Not Just Trials

  • It's crucial to sell customers on the ongoing value of a service, not just the initial trial.
  • Ensuring customers are aware of upcoming bills can reduce chargebacks and customer dissatisfaction.
  • Effective selling involves convincing customers of the value of the service beyond the trial period.

"Make sure they know they're going to get billed. And if it were me, I'd probably only bill the people that I knew had been sold and had kind of at least verbally agreed to it."

This quote advises to clearly communicate billing practices to customers and to focus on billing those who understand and agree to the terms, which helps in maintaining a good customer relationship.

Monetizing Free Offers

  • Learning to monetize free offers is a critical skill for competitive advantage.
  • Knowing the conversion metrics, average ticket size, and customer lifetime value (LTV) allows for confident marketing.
  • Competitors who can monetize effectively will acquire customers at a lower cost.

"Learning how to monetize free is one of the biggest tools in your skill set, in your toolbox. And if you don't know how to do it, you will be at a significant disadvantage because your competitors will be, and they can acquire more customers at a cheaper price than you do."

This quote underscores the importance of mastering the monetization of free offers to stay competitive and acquire customers cost-effectively.

Clarity and Simplicity of Offers

  • The offer must be clear and simple enough to be explained in one or two sentences.
  • A well-crafted offer can significantly increase profits.
  • Clarity in the offer is essential for prospects to understand and be attracted to it.

"If you get the offer right, someone should be able to explain to someone else in like one sentence or two sentences what it is that the offer is. If you can't explain it like that, then it is not clear enough to a prospect."

The quote highlights the necessity for offers to be easily understandable to ensure they are appealing and effective for prospects.

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