How to Use the 80/20 Rule to Work Less and Make More

Most marketing gurus will advise you to market your business everywhere, on every channel possible. Not Perry Marshall.

Perry, a best-selling author, speaker, and world-renowned business consultant, joins the show to explain the 80/20 marketing rule and why you should apply its principles to help simplify your marketing approach.

We discuss why you should identify your customers through a disqualification process and how this approach will save you time, improve customer satisfaction, and increase your profits.

Listen to this episode:

We covered:

  • How to identify your customers by using John Paul Mendocha’s 5 Power Disqualifiers
  • Why sales should be a disqualification process rather than a convincing process
  • The five elements that identify whether a customer will buy your product
  • How to begin implementing the 80/20 Marketing rules into your sales approach
  • The importance of categorizing your customers into groups and identifying their commonalities
  • Why you must speak with your customers face to face or on the phone
  • The top three qualifying questions you can ask any of your customers
  • The key characteristic that separates amateur marketers from professional marketers
  • The framework of direct-response marketing
  • How to “agitate” your customer’s problems in an honest and ethical method
  • The formula to guarantee your customer’s satisfaction
  • Why customer disqualification will increase customer satisfaction

Resources:

Full Transcript:

Louis: Bonjour, bonjour, and welcome to another episode of everyonehatesmarketers.com, the no-fluff, actionable marketing podcast for marketers, founders, and tech people who are just sick of shady, aggressive marketing. I’m your host, Louis Grenier.

In today’s episode, you will learn how to use the 80/20 rule to work less and make more in marketing. My guest today is Perry Marshall, a best-selling author, speaker, engineer, and world-renowned business consultant based in Chicago. He wrote the Ultimate Guide to Google AdWords and the 80/20 Sales and Marketing marketing books.

So, marketing maverick, Dan Kennedy, said about Perry that, “If you don’t know who he is, it’s unforgivable. He’s an honest man in a field rife with charlatans,” which I think is a good quote that links very well with the topic of the podcast.

So, Perry, welcome aboard.

Perry: Thank you. Great to be here and a fun topic. Why people hate marketers.

Louis: So, why do they hate us?

Perry: I don’t think people hate marketers as much as they used to, or maybe they don’t disrespect marketers as much as they used to. I think that my observation over 20 years is that marketers have actually become perceived as being more important in the world than they were 20 years ago.

And the reason I say that is, well, I know a lot of scientists, and even when I have a conversation with scientists and we’re talking about science stuff, they eventually ask me a marketing question because they have to market, too. I mean, they might not market the same way that somebody with an ecommerce website does, but they have ideas.

And I’m not just talking about scientists either. All kinds of people, anybody who deals with changing people’s thoughts or behaviors or opinions or politics or religion or anything like that. Everybody knows, well, if you don’t get eyeballs, if you don’t have any fans, everybody knows if you put a book out, and you don’t have any fans, then nobody reads your book.

Right? And so, anyway, but that doesn’t mean that people don’t have quite a bit of disdain for marketers nonetheless and for good reason. So, that’s what we’re here to talk about.

Louis: What are the good reasons according to you?

Perry: Well, Dan Kennedy has this saying, “Anything that works in marketing eventually becomes illegal.” And so, like fax broadcasting, it used to be legal, and then it became illegal. Right? Telemarketing was legal, and then it became illegal, at least if you got on the Do Not Call list, they can’t call you. Right? Well, it’s because marketers always push the envelope until people are sick of it. Right?

And so, back in the day, fax broadcasting was a really effective, really profitable thing. You just send out 10,000 faxes, and it only cost like, I don’t know, two cents apiece or something to send them out.

It was 1/10 the price of sending mail or maybe even cheaper. Right? But then, you’d get all these angry people. But if you got one person to sign up for your Caribbean cruise from that fax, right, you made all your money back.

So, what marketers tend to do is poop in the swimming pool. Now, you have turds floating around in the swimming pool, and everybody is like, “Well, who did that?” Right? “Well, if we make marketing illegal, then we won’t have to deal with that anymore, and it will go away.”

And so, it’s always the case, well, you’re running into 80/20 at this point. 20% of the offenders create 80% of the problems.

It’s always a small percentage of people that do that. A really, really famous marketer from 10 or 20 years ago was Kevin Trudeau, and this guy just … he had a sixth sense for how to sell, and he sold millions and millions and millions of dollars of stuff. He’s in prison now.

I don’t even remember exactly for what, but almost everything he sold, it was like barely on the edge of legitimacy, and maybe it was past the edge of legitimacy, where he wasn’t really exactly telling you the truth.

And so, these things catch up to people, and I feel like part of my job as a marketer and as a teacher of marketing is that the way I conduct myself, I should be trying to restore people’s faith in humanity or faith in at least part of humanity, that there are honest, straight-shooting people out there.

There are people who will not sell you something if it’s not a good fit for you, and in fact, that gets into a whole 80/20 philosophy about marketing. 80/20 really turns marketing itself upside down, so I think 80/20 is actually a perfect topic to be talking about in this particular context.

Louis: So, it’s strange for a marketing expert like yourself to advocate to do less because it seems like a lot of … I’m being sarcastic here, but it seems a lot of gurus out there would advocate for you to be in everywhere, in all, every channel, and go in into this new channel that just appeared because you’d be the first in line. Yet the 80/20 rule is pretty much the opposite.

You focus on the 20% that leads to the 80%. Even more than that, you focus on the … because you had explained that in more detail. You can dive in into it way more than just 80/20. So, why do you think do we still have those so-called experts that advocate for the complete opposite, this kind of shotgun approach as you like to call it?

Perry: Well, it’s the prevalent approach, okay? It’s the way most people think. It’s the norm, and in most fields, whatever most people think is the right way to do something is in some sense the wrong way to do it. I think if you’re talking about making real progress, most people are wrong about most things.

My friend, John Paul Mendocha, is a very interesting character. He dropped out of high school at age 17, and he moved to Las Vegas to be a professional gambler. He did that for three and a half years, and towards the end of his gambling career, which he was involved in organized crime and all kinds of crazy stuff, okay?

He’s sitting in a restaurant booth, and these two guys are having an argument like, “Yes, you will.” “No, I won’t.” “Yes, you will.” “No, I won’t,” and out comes a Glock.

And the guy puts a gun on the other guy’s head, and he’s like, “Yes, you will.” John is watching this, and he’s like, “Dude. If I don’t get out of here, it’s going to be me with a gun on my head, and it’s not going to be pretty.” And he just left. He’s like, “Okay. I am done with this.”

He went, and he got himself a regular job. And so, he’s selling some kind of a computer equipment, and his boss puts 206 sales leads on his desk. He goes, “John, I want you to go see all these people and close them.” Now, John was a pretty young sales guy.

He’s probably only 21, but four years in Vegas had taught him some street smarts. And he looks at this stack of leads, and he’s like, “There’s no way 206 of these 206 people are worth going to see let alone ever going to buy from me.” Like, “I got to figure out how to chop this down and save myself some time because I’m not driving to 206 appointments.”

And so, he came up with something called The 5 Power Disqualifiers, and they’re the five things that are true anytime anybody buys anything. Okay, and that’s pretty smart if you think about it. So, here’s what they are:

Number one: They have the money. Now, as obvious as it might sound, there’s a lot of salespeople, myself included, who have spent hours, days, weeks, and months trying to sell something to somebody who didn’t actually have the money. And you can sing Kumbaya, and you can like them and everything else all you want, but if they don’t have the money, they’re not buying the stuff, okay?

Number two: They have a bleeding neck. If you go to the hospital with a broken arm, you think you’re having the world’s worst emergency. You get there, and the lady in the emergency room hands you a clipboard and a pen and says, “Here. Go fill this out and come back and see me.” And then, you sit for two hours, right? And you think you have an emergency, but she doesn’t, right?

And then, some guy comes with a gunshot wound, and blood is squirting on the ceiling. They don’t make him fill out the clipboard, right? They see him right away, and it’s urgency.

People buy things when there’s an urgent need to buy something, right? I mean, they might buy a candy bar in the grocery store because they’re really, really hungry, but I mean that’s the bleeding neck, right?

Number three: They buy into your unique selling proposition, whatever that is. Number four: They have the ability to say, “Yes.” There’s lots of people that you try to sell to. They can tell you, “No,” but they can’t tell you, “Yes.” You go see the engineer, and he can say, “No,” but he can’t write a purchase order.

He has to go to a purchasing agent. He has to go to his boss, right? I’ve spent lots of time trying to sell to people that could only say, “No.” Okay? And the fifth one is it fits their overall plans.

Now, if you have all five of those things, you have somebody who’s pretty likely to buy from you, and if any of those things aren’t true, they’re not going to buy. And so, John calls these 206 people, and he asks them a bunch of questions.

He narrows it down to 12 he should meet with, and he sold six. Okay? That is how sales should be done. That is the 80/20 approach to sales. So, 80/20 says sales is not a convincing people process.

Sales is a disqualification process. It actually starts with who do I not sell to, and I’ve used this quite a bit. So, for example, author of the book Ultimate Guide for Facebook Advertising, it’s in its third edition now, and when we wrote that book, when it first came out, it was 2011.

And at that time, Facebook advertising was not that good. I mean, it is really powerful now, but it was pretty shaky at that point. And basically, what that meant was probably 15% of the businesses in the world were a good fit for Facebook advertising, and 85 were not. And so, when we put that book out, I thought, “All right. I could make it sound like this is really easy to do, and I could sell lots of books.

But if I do that, I will get a bunch of disappointed customers, and I’ll get a bunch of two- and three-star reviews on Amazon.” Okay? Because they really shouldn’t have been using it in the first place. So, who is shooting fish in a barrel with Facebook? And we identified certain kind of businesses, and we came up with a quiz.

And the quiz is … it still exists, and we’ve updated it with as the times, isfbforme.com, I-S-F-B stands for is Facebook for me. And you go there, and in effect, it was like page one of the book said, “Go to isfbforme.com and take this little quiz.

It will tell you on a scale of one to 10 how good of a fit this is for you.” And it was like, “Okay. If you got eight to 10, then you should dive into this book right away. And if you got like a six or higher, then it’s definitely workable. And if you got less than a five, see if you can get your money back from buying this book.”

And it worked, okay? And they would take the thing, and they would get an 8.7, or they would get a 6.1, or whatever the score was, and that worked really well.

When you sell that way, and when people can clearly see that you are pushing some people away, so if you’re pushing away the five-and-a-half or the four-and-a-half, and saying, “Hey. You’ve probably got a lot of better priorities that you could [inaudible 00:15:01], so go do them.”

And when people see you doing that, then the guy that got an 8.7, you say, “Dude. You need to buy this course. You need to study this book. You need to go whole hog into this thing,” and it increases your credibility. It increases your trust.

And even two weeks later, that customer might be having some trouble, and they might be doubting you. If they remember, “Hey, wait a minute. That guy pushed away other people that were willing to give him money, but he took mine because I had an 8.7.

Maybe that means I need to try a little more elbow grease on this thing before I just give up and write him a two-star review or a one-star review.” Right? That is really how you should do marketing, and if you do marketing that way, you’re almost guaranteed not to be perceived as sleazy.

Louis: So, let’s repeat what you said earlier which is super powerful. The five elements that tell you whether someone should buy from you. So, first, they have money. Two, they have a problem like bleeding neck problem.

Perry: Mm-hmm (affirmative).

Louis: Three, I’m going to forget. What did you say is-

Perry: They agree with your USP.

Louis: They agree with your unique selling prop. Number four is-

Perry: They have the ability to say, “Yes.”

Louis: And number five, they … I’m going to forget as well. I’m very bad at this today.

Perry: It fits their overall plans.

Right. So, if you’re selling kitchen remodeling, and you’ve got the husband, but the wife isn’t there, he can say, “No,” but he’s not going to say, “Yes,” right? And if they’re getting ready to move to Albuquerque in two weeks, you’re not going to sell them a kitchen remodel today, right?

Even if they like everything else that you’re doing, right? And so, I mean, it’s a brilliant, brilliant list of five things, and furthermore, you can take those five things and use them to dial in.

So, where are the people with the money, okay? Do they live in certain postal codes, or are they on certain lists? Do they live in certain neighborhoods? Do they drive certain cars, right? What exactly is the bleeding neck that we’re going after? There’s all kinds of bleeding necks in the world, right?

You could just take those five things, and you can dial them in with such precision then now everybody that you’re talking to is a reasonable candidate for buying what you’ve got. And then, your life just becomes so much easier, and that’s the hard part about being new in sales is you don’t know what you don’t know.

You don’t know where the bones are buried. You don’t know what kind of customers to pursue, and you just waste all this time. It’s painful. It’s hideous.

Louis: So, talking to a lot of listeners most weeks, and I know that one pain point is like bleeding neck to flip that around is the fact that they know that.

They can feel that they need to focus on the tiny amount of people, like the 20% or even like the 4% of the people they could serve, but they really struggle with taking the decision to do so, right? It’s like taking the leap to say, “Actually I’m not going to serve you,” and saying, “No,” to someone who comes to you because, and when you need money, is incredibly difficult, especially at the start.

So, how do you convince people to do that, and forget about the fact that you could serve everyone and just focus on the tiniest amount of people possible, the ones that are worth the money?

Perry: Well, in 80/20 Sales and Marketing, I show how we could be talking about almost anything, and 80/20 is true, okay? So, 80% of your sales come from 20% of your customers, and 80% of the 80% of your sales comes from 20% of the 20% of your customers. So, 64% of your sales is from 4% of your customers.

That’s almost always true in any company, and 80% of the people have 20% of the wealth. 80% of the cars are driving on 20% of the roads, and 80% of the dirt on your carpet is in 20% of the carpet because it’s a law of nature.

I’ve got an appendix in the book 80/20 Sales and Marketing, and we put it on a graph. The graph, it looks like an exponential curve, except the end of it goes even sharper, and it goes almost straight up in the air.

Perfectly vertical and it just goes higher and higher and higher, and it shows how as you get to that tippy top, the responsiveness, or the ability to spend money just goes incredibly high.

By the way, this is why there’s eight billion people in the world, and the richest one is worth $150 billion, Jeff Bezos, okay? 80/20 guarantees you that somebody’s going to worth $100 billion, and that one person is going to have more money than the bottom 10% of the entire world. It’s a law of nature, okay?

And when I start showing people, “Hey, this is everywhere, and you can’t avoid it,” here’s what usually happens. They go, “Oh. Yes. I’ve seen this before, I just never heard it explained this way.

Oh, my goodness, yeah, you’re right.” Like, “80% of our support tickets do come from 20% of our product defects and customers and what packaging problems or whatever,” and so usually it’s when you can get people to see the high upside of serving that narrow segment, they can see what a waste of time it is serving the bottom, where the leverage is literally 1/100 as much.

And so, it’s just incredibly powerful when you see it in action. I could open almost any spreadsheet or financial report in your business, and I can show you, “Okay. There’s an 80/20, and there’s an 80/20, and there’s an 80/20.” So, that means there’s these tiny, little levers that just make huge, huge differences.

Louis: So, let’s dive in into an example, right? Like a practical case of a company that would need to implement this kind of rule in their marketing to become more effective to sell more. How do you typically tell them to start? What are the steps?

And correct me if I’m wrong, it sounds like the first step is to actually look at, as you just mentioned, maybe your revenue data, your customer data, and actually audit it to understand where are those top 20% of customers. Who are they, right? Or, I might be wrong, so please tell me, what is step one?

Perry: Well, the first time that 80/20 was explained to me in a business context, I was reading some book. I was a sales manager at this software company, and I thought, “Wow. Is that really true? 80% of my sales are from 20% of my customer?” And so, I went to QuickBooks, and I printed out a report.

It ranked the highest-transaction customers first, and then it trailed down. I just took a calculator, and I went down through it. Like, “I’ll be darned.” When I got about 20% down through that report, I had 80% of the money that we had collected in the previous month. I’m like, “Wow, okay.”

So, if you do that, anybody could do that, you will see patterns. So, the easiest thing to do is you draw a line between the top 20 and the bottom 80, and you say, “Okay. What are the common set of things that the 20 have in common that the 80 don’t?” And maybe even, “What do the 80 have in common that the 20 don’t?” And you will see patterns.

You could see any number of things. It could be, “Wow. Almost all of our best customers are Fortune 100 companies.” Now, that might be like a really obvious one, let’s say, or, “You know what? We sell in 20 different industries, but most of our best customers are in automotive and semi-conductor.”

Okay? And then if I look at the 80%, most of those are these little, tiny system integrators, and they buy like one thing at a time.

You start separating them into groups, and you go, “Oh, okay. I can actually see some commonalities.”

You take The 5 Power Disqualifiers, and you go, “Well, if I look at my top 20% of customers, how much money do those people usually have, and what bleeding neck do they usually have? How is their bleeding neck different than everybody else?”

If you actually talk to these customers, which I hope you do, what part of the USP do they actually like? Your USP usually has a bunch of different things. Well, what is it that’s actually making them buy, right?

Or, within that firm, which of the people were actually saying, “Yes,” to us? Because not everybody was. Not everybody wanted to go with us as a vendor, so which ones, which kind of people pushed it through?

And it might be like, well, like at one of the companies I worked at, the best person for us to sell to was not the engineering manager.

It was actually the marketing manager because the marketing manager needed a feature that we had in order for him to sell his product, and the engineering manager wanted to just build it themselves, and the marketing manager is like, “No. That’ll take a year, and I don’t have a year. I want to just buy it from these guys, and it’ll be working tomorrow.”

And so, this is called market segmentation, and you start looking at this. You break it down, and you’ll find it.

You break it down to the top 5% of your customers, and sometimes you’ll find amazing commonalities like, “Wow. We should just go after these kinds of guys. We don’t have to go chase everybody around.” And notice you’re doing less and less not more and more.

Louis: Right. So, it sounds like step one is identifying those 20%, and step two will be like looking at patterns using The 5 Disqualifiers. Now, something that I’ve noticed a lot in the past when you look at this type of data is humans are pretty good at finding patterns, right? It’s just … it becomes obvious.

You know you’ve something interesting. You look at it. You know. Oh, come on. Like as you mentioned, they are all in the same industry, or they all have the same role.

There are other things that are actually something that you might want to look at which could be psychographics as well. So, not necessarily just who they are and what they do, but also what they believe in, right, and what they don’t believe in.

Perry: Right. Certainly. Yes.

Louis: And you said something just briefly, but I think we can dive in into that a bit more. You said, “I hope you’re talking to them. I hope you’re talking to your customer.”

Now, we both know that maybe 20% of marketers talk to their customers and something like that, right? And so, why did you say that that was an important step? And I would put it under step three. But why did you say talking to those customers is something you need to do?

Perry: Look. When I hung out my shingle, and when I was doing sales and marketing at various companies, I really greatly preferred to hide in my cave and just press the Send button and deal with the world via the remote control. Okay? And in fact, I think that’s a key difference between marketers and salespeople.

Salespeople are usually people that want to just go mix it up. They want to talk to people. They want to see people. They’re usually more extroverted. Marketers are usually more introverted.

In fact, I would say most of the marketers I know are actually introverts, and they like the remote-control way of dealing with the world. They would rather take a survey than pick up the phone and talk to somebody.

Sometimes, there’s a positioning issue as well, like, “I want to be the guru at the top of the mountain, and I don’t want to come down to the bottom of the mountain and talk to all the ordinary people.” You could have that going on, too.

And so, marketers often resist dealing with like the flesh and bone of real humans, and they like to deal with their audience, their customers as a list or as a segment or as a demographic. They don’t want to think of them as eyeballs and ears and skin and emotions and all of that.

That’s just a common way for marketers to be, but, well, that does have some bad habits and some bad tendencies wrapped in it, okay? Because look.

You can learn a lot about customers by actually going out and meeting with them and talking with them and having a beer with them and all of that, and it’s actually fun.

I know for me, I just had to get over being intimidated. I had to, oh, I mean, I think I had some emotional hang-ups about that, and I just needed to get myself sorted out. Sometimes, you have to have an honest talking to yourself like, “Dude. Why don’t you want to call?”

Pick up the phone and call that customer and talk it over because they’ll tell you an incredible amount of stuff if you just ask.

Louis: And I would concur to that. Recently, I can share a bit of a story. Recently, a few weeks ago, I chose to cancel all my meetings and calls during the week, and I was like, “Fuck it. I just need to talk to customers.

I need to talk to at least 20 of them, and I feel like I’m making too many assumptions right now.” And I did, so I literally spent so 30 minutes per customer times more than 20, and almost 20 hours at this stage just talking to customers. And at the end of the week, I had so much clarity about everything.

I had done tons of survey analysis the few weeks before. I had done tons of research and SEO research and all of that, and yet, I was feeling a bit like unclear in my head. And as soon as I talked to those customers at the end, I just felt so much clarity about everything, and I knew what to do.

There’s no question because you remember what people tell you. You remember how they tell it. You remember what they don’t tell you as well. You remember how they react to things, and that is what we’re pretty good at as humans, right?

So, I would concur to what you just said, and talking to customers when you’re struggling, when you’re not clear what to do, is probably one of probably the activity you need to do right now to get to the next step, right?

Perry: Yeah. That’s right. That’s right. Hear it from the horse’s mouth, and what most people won’t do that. Should they? Yeah. Do they? No. It immediately puts you at the head of the pack.

Louis: So, what questions do you like to ask customers? Let’s say the top three. Maybe they are linked to The 5 Disqualifiers you mentioned, maybe they are not, but what do you like to ask them?

Perry: Well, so here’s a set of questions that you can ask any customer, and you can ask in person. You can ask in email. You can ask in a survey.

Three questions. One: What is your biggest problem with X right now? Right? Your diabetes or your SEO or your computer or your volleyball game, right?

What’s the biggest problem you have with this right now? Number two: How hard has it been for you to find a solution to this problem? And number three: What difference would it make if we solved this problem for good? How would it affect your life? Okay.

I think those are probably the three best questions that you could ask a customer, and it will tell you what problem they’re willing to spend money on, the reasons why they want to spend it, and it’ll also tell you that middle question.

How hard has it been for you to find a solution? If they’re telling you it’s not very hard, you’re not going to sell anything. Okay? That’s a disqualifier right there.

“Well, this problem isn’t really that hard to solve.” Right? If they said, “I really, really want a hamburger,” and you go … They’re like, “I want a good hamburger,” and you say, “Well, how hard has it been for you to find a good hamburger?”

And you go, “Oh, well, there’s like four within a mile of here. I’m just hungry right now.” It’s like, well, you’ll sell them a hamburger if you have one in the parking lot, but if they have to drive two miles away, you’re not going to sell them a hamburger. Right?

So, I mean, that’s a good start right there, and it gets straight to the point, too. Right? You’re not sitting there asking the guy about the fish on his wall, which, of course, you’re welcome to do if you want, but I’d rather just get to the point. I hate small talk.

Louis: So, what problems are you suffering from right now? How hard is it, was it for you to find a solution, and what would it mean for you to solve these problems? So, once you have those answers, let’s say you’ve talked to 20 customers like I did recently. Once you have those answers, what do you do?

Perry: Okay. So, first of all, you throw out all of the, “Well, it’s not terribly hard to find the answer to this question.” You throw them out. If you’re taking a survey, all the people that answered that way, they don’t count.

Whatever they said, just throw it away. Okay? They’re not your customer, so you’re left with the people that said, “Yeah, man. This is a really hard problem to solve.” Okay? And then, you’ve got another way to sort it on top of that, is how long of an answer did they give you?

Did they give you one sentence, or did they type you a whole entire big long paragraph in the tiny, little box that you gave them? Or, did they talk to you for 15 minutes about what this big problem is?

So, when you throw away the not-very-hards, that gets rid of 80% of them. And then, when you throw away the short answers, and you keep the long answers, now, you’re down to 5 or 10%, and those are your real customers. So, that’s who’s going to buy from you.

That’s the real problem that you ought to be solving in the marketplace, and these are the benefits of solving that problem, which they just told you in their own language, which is better than the language you could have ever come up with.

Right? So now, you put that in your ad copy. You put that on your web page. You put that in your sales presentation. And now, you’ve really got something.

Louis: Right. And so, that’s quite powerful, and I actually never thought of using the length of answers as a qualifier to understand whether someone is worth pursuing or not, and I did send a lot of surveys, which isn’t … So, that’s really interesting for me.

Perry: It is. It’s powerful. There’s a whole chapter in 80/20 Sales and Marketing about how you do this. In fact, we even have there’s some bonus material on the website inside the book, and we have a back door. You can go get that, and there’s a whole scoring algorithm that you can use in a spreadsheet.

So, if you use SurveyMonkey or one of these other survey services, and it generates a CSV file or a spreadsheet for you, then you can take our formula, apply it, and it basically does the work for you.

And then, you can rank the answers from most helpful to least helpful and just go for the very best stuff, and you almost can’t go wrong with that method. It’s really powerful.

Louis: And now, you mentioned a few sources. You can ask those questions, as you say, on survey, via email, over the phone, so I suspect when you talk to someone over the phone, it’s not really not the length. It’s like how long did they spend talking after you just asked them one question, right?

Perry: Yeah. And how emotional are they?

Louis: So, you can feel that more when you talk to people face to face over the phone. You can feel the emotions, and that’s probably something you need to qualify as well when you talk to them, which is why talking to those 20 customers was so helpful for me because you can feel it.

You can feel when someone is really suffering versus when someone doesn’t really give a shit. So, let’s say we have a … It’s true, isn’t it?

Perry: Mm-hmm (affirmative).

Louis: So, let’s say we have a solid list now. We know exactly who are those people who suffer from a big problem, who are willing to solve it now, who have to budget to do so, who have the power to say, “Yes,” to the decision, who believe in you because they’re spending a lot of time with you.

They’ve answered your survey, so they probably connect with you, who find your unique selling points unique and are compelling to them. And you started to mention the fact that you can use that in your ad copy and all of that.

I was interested in hearing more from you when it comes to the problem itself, and how do you make sure that you use that in your copy because, and in your marketing in general?

It seems like you are kind of an advocate of agitating the problem, talking more about the problem, rather than the features of the solution. So, tell me more about this.

Perry: I think this separates the men from the boys right here, the amateurs from the pros. So, amateur marketers they … here’s what amateur marketers do. (singing) And they’re just like, “Oh, look how cool we are.

Man, we got all these features, and we got all these testimonials. We got all these endorsements. Ooh, bam, man, we’re going to fix this, and we’re going to fix that. This is going to be so awesome.” Okay? That’s what amateur marketers do.

The real pros, they just rub salt in the wound. It’s like what a pro does, a pro will say, “Hey,” like you go to the doctor, and you’re like, “Hey, see my elbow here?

This just really hurts.” And what the doctor does is he takes a hammer, and he goes … or he might take a notebook, and he’ll go (sound of noteback slamming) … And you go, “Ah!” And he’s like, “So, does it hurt when I do that?”

Okay, now, a doctor might not do that, but a really good marketer will. Okay? He’s going to go exactly for the jugular, and he’s going to describe it like a Stephen King novel. He’s going to make you see that if you don’t do something about this, your life is just going to get worse. And he’s going to get you to be honest with yourself about the pain that you’re already in.

Dan Kennedy did this when I first got introduced to marketing. In 1997, I was totally broke. I was failing in my sales job. I was a few months away from getting fired. I had a one-and-a-half-year-old baby girl at home, and, man, I was just in a world of pain.

And he got up, and he talked about … he said, “Cold calling is the lowest form of grunt work in the whole earth. It’s like if you’re cold calling, you might as well be a slave pushing around blocks and building the pyramids in Egypt.” Like, “Nobody should be doing this.”

Well, he was the first sales trainer to ever admit what an awful job this is, but then he added like, “Well, here’s what you should be doing instead.” And he started going into direct-response marketing. Well, that’s like really good problem, agitate, and solve.

Louis: And that’s the framework, isn’t it? Problem, agitate it, and solve it.

Perry: Right. And the agitate is where … that’s where the real magic is. Like, “Wow.”

Louis: Let me summarize a bit more what you said, and then we can dive in into that a bit more. So, step one, you get our customer data. You identify those top 20%. Step two, you try to find patterns in terms of like who they are, what they believe in or they don’t believe in. Step three, you kind of talk to them. You survey them. You email them.

You collect the answers, and particularly, you look at the ones that are emotionally loaded, that have great length, and that are saying to you, “It’s really hard for me to find the solution to this problem,” right? And you discard the rest.

Step four, you identify the core problem that this infers from, and you do what you just said. So, you identify it. You write it down, and you agitate it as you said as a doctor, you would identify the pain. You would make sure that it’s painful. You would talk about it in their own language, and then you solve it and say, “This is the solution.”

I’m curious to hear a bit more about how do you actually agitate a problem in practical terms, right? So, what are the things that you would recommend people to do to agitate it in a honest, ethical way? Something that makes sense for people and where they don’t feel like they are being sold to in a sleazy way.

Perry: Okay. So, here is an example. If you go to perrymarshall.com/headtrash, there’s a page, and it talks about how entrepreneurs self-sabotage. Okay? And if you read that page, the top of the page says, “Dysfunctions, Addictions, and The Financial Burning Bus,” and I talk about watching many, many entrepreneurs go from wealthy to crash and burn bankruptcy and have these failure cycles.

And then, I invite you to opt-in, and then when you read the emails, these emails are agitating. And the way I do that is I tell real stories of real people in painful situations, and I’m not being gratuitous. I’m just being honest about what real life is because life is not all jelly beans and bonbons. Okay? People have real problems. They have real pain. They have real suffering. Okay? And I connect with that, and I talk honestly about it.

And then, at some point, I say, “Okay. So, are you tired of this yet?” Like, “You know what this is like. Have you had enough?” And people respond to that, and it’s not sleazy because it’s real. Okay? This (singing). That’s not real. It’s like that frog on the cartoon. It’s a show, but it doesn’t connect with people authentically.

Louis: And that’s something like Joanna Wiebe mentioned in the podcast a few months ago, a few years ago at this stage, where she was saying that the best copywriters don’t come up with copy, that they just steal it from customers, right?

And I think based on what you said it’s more generically the more I talk to experts like you, the more the same answer comes back, which is, “Don’t try to come up with marketing on your own or to find problems on your own. Talk to people. Use their language. Use their story to agitate the problem, identify it, and solve it.” Right?

Perry: It’s actually more work to go get the real stories at first because you have to go dig them out. It’s like mining, okay? It’s like mining for gold. I mean, if you know anything about mining, it’s like, well, you’re digging through all this rock, and you’re looking for some copper.

You’re looking for some gold, but then when you find it, it’s like, “Oh. Okay. Well, here’s some gold. Let’s just take it out of the mine, and let’s put it to use.”

Right? So, when people do tell you their stories, then all of a sudden, it’s like, “Wow. I’ve got more material than I could possibly use here.” So, yeah, that’s what you do. And you can really connect with people when you do that.

It’s not just a way of selling something. I mean, when you speak honestly about problems, I mean, most marketers, and this gets to the theme of your show and why people hate marketers, is most marketers are not talking honestly about the real problems. They’re glossing over them.

And when you just talk honestly about the problems, you can have some flaws, and they’ll put up with you because they know everybody has flaws. They just want somebody to be honest with them about it. That’s all.

Louis: After that, once you’ve collected those stories, and I suppose it’s much easier to collect those stories once you’ve talked to people face to face-

Perry: Yes.

Louis: … over the phone, just surveys. I suppose that’s the next step, isn’t it? You ask the permission to use the answers of to their problems to in your copy and your emails and whatnot. So, let’s say people are, right, reading your copy, looking at your video, anything where you’re trying to convince them to buy from you.

How do you kind of seal the deal? How do you guarantee that they’ll get something in return if it doesn’t satisfy them? How do you approach this kind of guarantee side of things?

Perry: That’s a great question to kind of start wrapping this up. I have a favorite formula for guarantees, and it ties right into The 5 Power Disqualifiers, and here’s the formula. If, if then, else. Okay? So, here’s how I use it.

If you are the right kind of person with the right bleeding neck, okay? And if you use the product or service in the correct manner, which usually means some level of cooperation or compliance, right?

I’ve got a client who sells stuff for getting preventing your clothes from getting eaten by moths. In order to work, his product has to be used a very particular way, otherwise, you’re going to open your closet, and that silk dress is going to have holes in it. Okay?

So, if you’re the right person with the right situation, and if you do these certain things, then you will get this result or else penalty to me, the vendor. Okay. So, here’s an example of a coaching program we used to sell.

If you’re spending at least $1,000 a month on Google Ads and if you join our program and do the homework, then you will increase your sales by at least 25% or X thousands of dollars a month, or we will give you all your money back and $1,000 cash for your trouble.

So, you get $1,000 more back than you spent. Okay? But they had to be the right kind of person. I can’t steer a parked car, and they had to do the stuff that we taught in the program. Okay?

That is a really good guarantee, and if you tie it to the bleeding neck issues, so then you will no longer have a bleeding neck, and you, who spent the money and did the things we told you to do, you will get a result because your job is to take the risk out.

Louis: How many people came back to you and asked for the $1,000 in refund?

Perry: Less than 5%. It was not a significant number of people, and I really do have to go in a minute. But one thing this does, is this forces you to do disqualification in your sales process so that you’re not selling to people that you cannot help.

And that just tightens the whole thing down, and that’s how we do business. We have all kinds of programs where we do not accept everybody. I don’t want everybody. I don’t need everybody. I’m not trying to sell everybody.

Louis: So, Perry, thanks so much for taking the time today. Last question. 30-second question or less. What are the top three resources you’d recommend listeners today? It could be in anything.

Perry: Well, I would recommend that you read 80/20 Sales and Marketing. It will totally change your life in the way that you see everything. Another, I’ll give you two more resources that I think would hugely help you.

I think everybody should read a book called The Star Principle by Richard Koch. It tells you what you should actually be trying to sell in the first place and what you shouldn’t. It’s one of these elimination books. A lot of people are in the wrong business, and they don’t know it.

Number three, I recommend the Book of Proverbs, which is in the Bible. I think it’s the best business book ever written, and it saves you from moral, ethical, and judgment catastrophes, which those are real things in business that bite you in the ass, and those are the things that make people hate marketers.

People don’t hate marketers for good strategies. They hate marketers for being sleazy. If you read the Book of Proverbs and you pay attention to it, you’ll never be sleazy, so there you go. That’s my three.

Louis: Where can listeners connect with you and learn more from you?

Perry: Go to sell8020.com and 80/20 Sales and Marketing is for sale for a penny plus shipping, and you watch how we sell to you. Watch what happens when you sign up and buy that book.

Louis: Perry, once again, thanks so much.

Perry: Thanks for being on. Appreciate it.

 

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