In the podcast:
02:41 – Why you have to test everything
08:05 – You absolutely need to have THIS right
11:59 – The details that make the difference
20:00 – Building on predictability
21:21 – Does SEO still work?
23:54 – How important is R and D?
28:56 – Making marketing control technology
33:48 – The first steps
39:37 – Is spelling important?
43:17 – The single, biggest expense in Andrew’s business?
46:34 – A super tip
49:08 – Consistency or leverage?
Got questions growing your business? James has answers. Click HERE
James: James Schramko here. Welcome back to SuperFastBusiness.com. Today, just like the episode title says, we are going to be learning about a growth story of a business that started from scratch and went to 200 million dollars per year in revenue after just six years with 1.7 million customers. And the architect of that significant feat is Andrew Lermsider. Welcome to today’s call.
Andrew: Thanks, man. Glad to be here.
James: So you’ve got what would be considered a pretty good result from your business, which is Q Link Wireless, which you’re the CMO and founding partner. How does that make you feel?
Andrew: You know, it’s very exciting. It was a really interesting culmination of building businesses online for the past 18 years, I would say, and this business really allowed us to take all the different knowledge that we learned in marketing and building businesses online and build it into what’s Q Link today. You and I spoke a little bit earlier, everyone gets caught in the shiny objects syndrome, but we really built Q Link on the foundation and really focusing on making sure we had the right systems, procedures, testing and all the right tools in place so that we can literally build that foundation to grow the business and scale – understanding how to scale people, scale the marketing, scale all the different components – so we didn’t blow the business up, and we were able to really do this, and the business is growing huge. We’ve had some really cool, amazing accomplishments that have happened along the way. So it’s fun to share the knowledge with everyone and give your listeners some incredible information that we’ve used to grow the business.
James: We got introduced by a mutual friend, Justin Brooke, and he’s very passionate about traffic and conversions and somewhat of an expert in the industry. So to be referred by him means something to me. And having spoken with you recently, I suspect you’re a testing nerd. Would that be accurate?
Why test everything?
Andrew: Absolutely. We test everything. You have to test everything because your website changes, technology changes, the users coming to your site change. I’ll tell you an interesting thing that we recently tested, and it’s important, and everyone needs to pay attention to it. Mobile, as we all know, there’s no more selling that mobile, you have to pay attention to it. Mobile is there. Seventy percent of the traffic in our phone business, almost maybe 80 percent comes in from mobile for people signing up for the service.
We recently launched a whole entire new sign-up process. It’s pretty complicated what we do in trying to get customers to upload documents and try to complete the process. What happened was we noticed that we were doing great on mobile but when we started digging into the details of the mobile, we saw that we weren’t doing great necessarily on all the different mobile devices. And one of the things that people forget today is that they group mobile as just one category. But within that, you have iPhones, you have Androids, you have different browsers – you have Safari browsers, Chrome browsers – and then within that, there’s another huge component that most people don’t really understand that’s going on, and that’s Facebook, within the app, they have their own browser that behaves a certain way.
We spend about maybe three quarters of a million a month advertising on Facebook. And what we found was, is that our conversions were not working as well on Facebook as they were on some of the other Google advertising on just a regular Safari device, like using an iPhone, using an Android phone. And when we dug into the details, what we found was, is that certain elements in our signup process were not working properly on Facebook’s Safari that’s built in and they actually have two different versions that are built in to basically their app.
Everybody who’s on Facebook is reaching your website through ads using Facebook’s app and using the built-in browser inside. If you’re not actually doing real world testing, actually taking physical devices and testing your website and running it through to see how an actual customer experiences your site, you’re probably losing a lot of sales. And when you really dig into Google Analytics and you start going inside to figure out the different devices that your customers are on and looking at what those different conversion factors are, you might start to find that maybe things are working better on one device over another because maybe something doesn’t work right on that device. Maybe something’s broken. Maybe you need to adjust things a little bit.
We literally dig so deep like that; that we’re able to hone down on our conversions so well that we perform really well on every device, every browser, every platform. And again, it’s changing all the time. Because last week, we had something down pat and then all of a sudden Facebook changed the browser and then we had to adjust something in it. So it’s a constant game of just being on top of your numbers, being on top of those fundamentals and making sure your conversions are there because that’s in the end where you’re going to be able to build the business. To me, you can get all the business you want coming, all the traffic coming to your site. But if you’re not converting it and turning it into dollars or leads or something that affects your business then you really have nothing. So that’s where I’ve always focused and by getting good at that, we’ve been able to scale businesses very quick and very, very efficiently.
James: That’s a really important thing. You and I are both doing a similar thing in that we’re both running businesses and at the same time helping other people with their businesses using a diagnostic checklist, and I know that cross browser and device testing is one of the things on your foundation and inspection checklist. You’ve got this checklist available via opt in at reviewbyandrew.com. I should mention that listeners of this show won’t be surprised by that news because if you were to go back to episode 206, which was recorded four and a half years ago, I was talking about how you must design your website for mobile because I just visited Google’s office here in Sydney and I found out about cross device browsing and how important it is.
And then if you go back to two years ago, we were talking about mobile first design in episode 399 where if you’re not designing your website around a mobile first then you’re behind the pack already. So I thought you might be interested in the history on that. It’s absolutely critical. I mean I run my entire business from a mobile. Unless I’m doing a Skype recording like this, I’m on my phone.
I think we should probably ask you a few more questions about the growth of Q Link Wireless because it’s going to do two things. It will certainly give us some clues as to what we might want to do with our own business, and it will probably pick up a few other important things on your checklist. But I’m going to ask you a loaded question here.
The number one thing to have right
James: Of the 15 or so, or I think there are 16 if you count a bonus tip, items on your checklist, what would you say is the number one thing that you absolutely have to have right if you could only pick one? Because I know what it would be for me, but I’m wondering if you would pick the same one or something different.
Andrew: I might surprise you. I think that speed because of mobile is so critical that that’s the biggest pickup we found when we improved the speed of the site. I think it was last November, I was personally invited out to Facebook’s headquarters in Menlo Park. And what I mean we were invited, they literally had our company name in a giant billboard for all of 22 Facebook’s buildings for all of their staff to see welcoming our company because we grew so fast and we’ve done some amazing things and we’re a very valued sort of advertiser to them because we actually give out cell phones to bring people back on their platform.
So it’s a unique type of advertiser that’s very important and we’re reaching that low-income demographic that they want. But while we were out there, we had this extensive talk about speed. And one of the things about speed that maybe everyone doesn’t realize especially when you’re talking about a mobile, people’s patience level is so slow. So while you might be paying for an advertisement, and this is something that was very new to us, we didn’t know this; we found out that we had an older site – it wasn’t optimized the way we wanted to be. It was kind of again, one of the original pieces that we built. We didn’t want to throw it out. It helped build at that point probably 100 million dollars a year in sales. So we were reluctant to throw our garbage and build the latest and greatest site.
But when we went out to Facebook, they said, “Do you know that 40 percent of the people that clicked your advertisement bail before the page loads, but you’re still paying for that click in some way or another however your campaign is optimized, you’re still paying for that?” So I know that in many, many businesses we’ve had in the past, the speed was the difference and the performance of the site between us making and breaking that conversion level that was able to beat our competitors and grow our business. So for me, speed is definitely the number one besides for a good design and having the right elements and calls to actions in the right places. But speed is really key to me.
James: Yeah, it’s critical. We’ve been on the speed thing for a few years now, about three years, I think, if we were to go back is when we were publishing infographics about it. But I remember a Walmart study that some pages were taking 24 seconds to load, which is just outrageous. And they saw a two percent increase in conversion for every second that they optimized the page. So speed is absolutely critical. What would be your best tip to someone for them to speed up their website?
How to speed up your website
Andrew: I got a great one. Google has a great free tool, the Test My Website tool. It’s awesome. And I use two tools when looking at speed. So Google’s tool, if you type it into Google, you type in “test my website,” there’s a link. It takes you right in. You pop in your website. It used to be broken down into desktop and mobile. The test now is fully just mobile and what they do that’s interesting is, is they run the speedtest on your site, based on the 3G experience, because Google says at this point, still 60 percent of the users when they’re on a mobile device are hitting you at about a 3G speed. So everything they’re assessing there is telling you how your site would perform on a standard mobile device that covers 60 percent of the population in terms of that speed.
As much as your developers might fight you on this, it is absolutely critical and it’s important because you want to make the Google gods and the Facebook gods happy because in the end, it’s not just the speed you see on the outside. It’s the organization of the code on your page that their algorithms and their computers are reading and the faster and easier you make it for their systems to read, the more they appreciate what you do and you will get rewarded for it with cheaper advertising cost, better rankings, and I’m not a huge fan of SEO anymore but all in all, it helps you all around.
The other thing that I would say, I don’t trust what Google says in terms of what the speed is on your site. I also go into Pingdom. And if you go to Pingdom, at the bottom of the page, they have a free tool that you can use. You can go to Pingdom tools, you pop in your website there, and you can hit the server and you can pick from locations in the United States or overseas and you can see truly how long it takes for someone to actually hit your site. They’ll also give you a rating and tell you how it is compared to other sites, you’re 80 percent faster than most other sites, it gives you a good guideline. It also tells you the size of your page.
And if you wanted a little bit, I can tell you a very, very interesting story about the size of the page and how changing the size of a page grew one business we had from doing 500 orders a day to 8,000 orders a day in a different business we did. So to me, it’s all about the small little details and perfecting those small details to get them down. And that’s the kind of stuff that can make all the difference in your business.
James: So you’re going to tell us what that was?
How the size of a page changed one business
Andrew: Yeah, absolutely. So before we did the phone business, we were selling supplements online. We were selling all different types of supplements – diet supplements, teeth whitening, we had a lot of different stuff. And this was during the heydays of all the free trial offers – the Oprah Winfrey and all that.
So we had built the business. We were doing about 500 orders a day on free trial. Nice-sized business. We had a good operation. Vertically integrated company, shipping in in-house, technology in-house, customer service in-house, design in-house development, everything there. And we had heard about all these other guys that were doing six, seven thousand orders a day, and we just couldn’t break through this 500 orders a day. And we had heard about this one affiliate network and back then, we didn’t drive the traffic ourselves. We did everything through affiliate networks. Today, we take a very opposite approach. But back then, it was all the affiliates that controlled the traffic.
There was this one network that was driving, I think it was maybe 5,000 orders a day for one of our competitors. And we had been chasing them and chasing them to run our offer. Finally, after like six months, they said, “You know what, we’re going to let you guys run this offer. We’re going to turn the traffic on for one hour and we’re going to see how your conversions back out.” So we literally had mission control in the office – screens everywhere, our staff ready, technology department – everyone was ready to watch. They called us up said, “OK, we’re turning it on.” They turned on the traffic and I never will forget this. It was like a faucet, James. They literally just flipped it on and in one hour, they sent us like 300 sales in an hour. They then turned it off. And we were like, ‘Oh my God,’ we were jumping up and down for joy. We thought we did amazing.
And then all of a sudden, they called us up, they’re like, ‘Sorry, your offer didn’t work. Your conversions were 12 percent. You needed to be at 12 and a half percent. Sorry the EPC didn’t back out for the affiliates. We’re not running your offer. Done.’ We were like, ‘What?’ And at that point, we literally had mimicked the majority of our biggest competitors. I mean our sites all looked very similar. The branding was different. We couldn’t understand how this was possible. And we lost the deal. We were like crushed.
About a week later, coincidentally, we became frenemies with the biggest guy in the business. And he realized that he needed to kind of help us a little bit so that other people didn’t start stealing his traffic away. And he said, “Let me look at your site and let me see what you guys are doing wrong.” He’s like, “It all looks perfect,” and we’re like, “OK.” He’s like, “You’re testing everything inside your building here?” We’re like, “Yeah.” He goes, “That’s the problem.” I’m like, “What do you mean?” He’s like, “The size of your page. The file size is too big. You need to optimize the images, optimize the code.” I’m talking about eight, nine years ago.
“You need to optimize all that. If you shrink all that stuff down, the real world is not hitting your side from a T-1 that you guys have in your office. That’s not the reality. You guys are testing in a non-real environment.” When we optimized those conversions, we optimized the site, we ran the offer again with affiliates, we got to 13 and a half percent on the conversions and we went from 500 sales a day, about six months later, we were doing 8 thousand sales day because we had the highest EPC offer in the industry and every affiliate ran off all the other offers and they jumped on our offer. And that was all due to the size of the page and the optimization.
James: Right. You were on to that nice and early. I want to sort of circle back and ask you two questions about things you just mentioned that might be interesting for my listeners and for me. Back in 2012, I shut down my affiliate program and you just mentioned that you don’t really rely on affiliate traffic as much anymore. Tell me about that.
Andrew: So, I actually started off in I guess about 2001. We had an online casino. And I was doing affiliate marketing.
James: Casinos and supplements. Did you ever do the porn?
Andrew: No, no. Definitely, we didn’t do that. I’ve been in payday..
James: You’ve got the pills and the gambling. You just didn’t get the other one.
Should you rely on affiliate traffic?
Andrew: Exactly. And the money lending on the other side. That’s the thing. I’ve been in, honestly James, every single high volume niche that’s out there and built a very strong big business off of it. So that’s why I kind of really understand all the components that are needed and I really understand what it takes to hit those conversion levels and drive those sales and make that time, really make the affiliates happy. But when we ran our supplement business and we grew that very large, we were so reliant on these affiliates and they got so greedy with us that every day, it was like, “Well, you got to pay us $45.” And then tomorrow it’s like, “No. You’ve got to pay us $50. And if you don’t pay us $50, there’s a new guy coming in and he’s going to pay us $55,” and it was just out of control. And they literally were controlling our business. And again like I said, that day when that one affiliate network turned that traffic on and off, it was like a faucet.
So when we started Q Link, I looked at the business and I sat with my partner and I said, “We can’t do that in this business. We’re not going to be at the mercy of these affiliates. We’re going to control our own traffic.” Now, be it, we had a very clean offer…
James: That’s what I call OwnTheRacecourse.
Andrew: Exactly. OwnTheRacecourse. And we built it that way. And we do very, very small amount of affiliate traffic through some network that someone manages in the office. To be honest, I don’t even pay attention to it because it’s insignificant. But there are some coupon sites and things that you can’t really reach unless you’re on ShareASale or CJ, whatever it is. But in the end, we build our business on things that are predictable. Facebook is predictable. It might change. The numbers might change. The cost might change. But it’s predictable. We can turn the faucet on and off. Google – the same thing. They literally fly into our office. We go to their offices and we have a strong understanding of how their systems work and how the programmatic media buying works.
“Control that faucet.”
Today more than ever, you as a business owner should control that faucet like I say, of being able to turn the traffic on and off. And listen, we have points in our business sometimes where we need to catch up on orders. Maybe we have too many orders in the month and we have too many phones to ship out and we need to slow down. We don’t have to call an affiliate network and say, “Back down the sales. We go into Google and we go onto Facebook and we turn the sales down. Or in the opposite way, we’ve been turning all the sales up.
So that’s where you want to be. You want to create those platforms and your advertisements in such a way. That’s why I always say that the conversions are so important that if those things are running right, you can just be changing ads and changing ad copy as you need to. You know the foundation is going to work. You drive those new creatives in and you turn the volume up and down as you need to to drive sales. And as long as you have the right funnels and monetization and emails and all those different components in place, your business becomes scalable. And what I look at really is predictable.
James: What about SEO? You’ve changed your position on that?
Is there still SEO?
Andrew: Yeah. I don’t know if there really is SEO anymore. I feel like it’s gotten so hard and I will say in honest with your listeners, that’s how we originally built our business. We went out and when we started Q Link, we gamed the system. We literally got number one for every single keyword. I don’t even know if we were necessarily live yet. We were just starting to bring traffic in, and by the time we turned the business on, we had 30,000 customers in like the first month and a half of going in business because we were ranking so high in Google.
But that one day, that parade came to an end and we woke up one day and our traffic was gone. Good thing was, we knew that that was going to disappear one day and we had already been building all our traffic inside AdWords and we’d been building it in Facebook and Bing we use actually quite a bit too. And it was OK. We kind of knew that we gamed it. We paid the price. We won at the beginning. We knew we lost at the end. Today, we’re ranking again and it’s all back up. But a lot of people ask me about it and I feel like the effort is so difficult and again, not predictable or necessarily scalable, that it’s hard for most guys unless you’re so good at content marketing, I find that SEO is very, very difficult today.
James: I’m glad you said that. I think SEO is easy and it relies around having good content. Exactly what I teach. You mentioned the magic words “game the system.” You know, they shut down operators like you because you weren’t providing value probably if you’re getting all these listings without the good content to support it, you weren’t delivering what they want, which is a good experience.
James: So I guess the cautionary tale here is twofold. It’s one, if you’re going to build a traffic stream make sure that it is sustainable and that you can rely on it. And don’t be shocked if it disappears. And the second thing is that it’s still there to get, but you just have to approach it in a different way. In 2017, it’s a very different era than five years ago. The interesting side note to this, Andrew, is over from eight years ago to last year, I built quite a big SEO empire and then I sold that business last year but it survived whilst almost all of our competitors collapsed because they didn’t notice the changes. And I think you said this to me earlier before this call, that one of the things that you do in your business is so much background testing and monitoring of your system that you know when something is broken before it becomes a big challenge.
The importance of R&D
Well that’s what we were doing with our SEO business and the secret sauce for us, which most businesses do not have, but I would recommend you do have this if you’re in a significant changing market, which most of us are if we’re online to start with, but if you’re doing a Facebook agency or you have an SEO business, you need to have a research and development protocol. You’ve got to have somebody or a team who are dedicated to researching what is happening in real time or what is about to happen so that you can be fast to move. How important do you think it is to have that element and to be able to be nimble in business, Andrew?
Andrew: You have to. I mean you really have to be able to adapt. Things change. Again, like you know, devices change, computers change, the way people consume information changes, your site changes. I have a business that we just recently acquired called GiftBasket.com. A whole thing that just happened with that, we bought the business. It was sort of an old school e-commerce site. The person who built it, he did a good job building it to a decent level of business. But this could be a giant brand with obviously that domain attached to it. And today, we we took the site and upgraded it from an older WooCommerce installation to a newer one. And there were a lot of things that broke.
“Expect things to break.”
And because I understand and I expect things to break in testing, I expect when updates to go out, things to break, we know exactly what to do. We were able to mitigate those losses very quickly because we knew exactly how to test. We knew the performance and I think that’s also critical – understanding what your baseline is so that when you make changes, you can see that something went wrong and something broke in your site. I’ll tell your listeners another great little tool and if any of them have an ecommerce business, I think it’s super important or some sort of a lead generation business where there’s multiple pages. I’m not sure if you’re familiar with the tool Monitis.
Monitis does some really cool, not just ping testing to see if your servers are up and the site is up, and that’s one thing, obviously, everyone should have set, they should know when their site goes down immediately so they can talk to their development team or whatever might be happening. But what this site does, which is really cool, it lets you do synthetic testing. So it’ll act as a human, let’s just say going through your sign up steps in the process. So let’s say you have an ecommerce checkout. It will go from your product page to your cart page to your checkout pages. And what it does is, it tells you the speed of all of those steps along the way. And it’s monitoring it. It will run the test for you let’s say every 20 minutes a day.
Well let’s say your development team changes something on a site, and it might just be an image. It’s sometimes just the simplest little thing breaks something else. When you look in this and you compare, you can see that, ‘Wait a minute. Last week, the numbers were here and now they’re here. Something’s wrong.’ And then you can equate that back to, say, development. ‘When did you put out an update?’ And for us, we don’t catch it a week later. We catch it, in all honesty, we catch it in a day. But that’s kind of like what happened today. We were able to go in and we knew certain things weren’t working right and the developers are saying, “No, no, no. It’s right.” It’s like, ‘No, it’s not right. I have a system that’s testing and can tell me what’s right.’ I trust that robotic, systematic procedure of these synthetic transactions that the system does. And I’m able to find things literally before really they become big problems. And that’s really important because a lot of times, i think, people change stuff and the developers change stuff, they don’t even know what their developers changed and things get broken and they catch those things that are broken so far out.
I mean in all honesty, James, I’m actually known with a lot of my friends, whenever they send me stuff, I’m not going to say some other internet marketers, but I’m always sending a lot of people that we know mutually, when they send me an email and I go to their site, I’m always just dissecting people’s websites and their businesses. It’s just, I’m the guy that knows how to find things wrong with what they’re doing and tell you and very quickly what you could be doing better. I’m always telling friends like, ‘That’s broken. That’s broken. Fix that.’ When we test, we have a philosophy in our office – break it. Don’t try to make it work. And that’s a philosophy every one of your listeners should follow.
Make marketing control technology
When you’re trying to test something that your developers put out there, don’t try to just make the order go through. Try to click around like an actual customer would do and try to break it. Try to pretend you don’t know what you’re doing. Give it to family members. Let them test it. Friends test it. Try to break it. Try to stress test it and go through it and try to create real-world experiences. No one’s going to go through things perfectly as the developer thinks they’re going to go through. I never, ever listen to developers. Developers listen to what we tell them. And that’s an interesting thing that we’ve done in our business. We’ve taken marketing and we make marketing control technology. Not a lot of companies can pull that off. Our technology department is controlled by marketing. In most companies, I find that technology is controlling everybody and they’re dictating everything of how things can be done.
James: Ah, right. That guy in the corner office with the black boxes and his little fiefdom telling the business they can and can’t do this.
Andrew: Exactly. Trying to make business decisions.
James: I know what you’re talking about. I’ve got clients who I say, “OK. Well, just do this and do that.” Like for my business, that’s pretty lean. I could say for our coaching program, let’s say the first year’s subscription is X amount and the second year subscription is X minus 10 percent amount as a loyalty bonus to acknowledge some diminishing return. And then my client will say, “Oh no. I can’t do that.” They’re hamstrung by a power higher than them for some reason. You know, the limitations restrict what they can and can’t do because they’ve buckled in to some horrendous dinosaur technology solution.
Andrew: Agreed. Agreed. I think the biggest thing when I look at businesses now, I see that that’s where a lot of people get stuck. We’ve always built our own systems and that has its own challenges to it also. But we’ve always been so vertically integrated. Our own CRMs, our own platforms, our own web development – everything we hand code and do ourselves. So we have a lot more control on what we want the systems and need the systems to do. But I see that that’s where a lot of companies get stuck. I have a lot of clients that have pretty sizable ecommerce businesses and some of them are stuck on platforms like Magento, and they can’t move because it’s so clumsy to move the platform.
That’s why I’ll tell everyone, you know, use Shopify because you don’t have to deal with development. You don’t have to deal with that guy in the corner telling you, ‘No, you can’t do this in marketing. No.’ You got to be able to, as a business owner, you’ve got to be able to run it how you see it needs to be run, not how the development team tells you.
James: Yeah. It’s kind of like the relationship you might have with your accountant, isn’t it? You say, “This is the car I’d like to own. See how you can make it work for us on the financials,” rather than you know, ‘Oh, so I can buy a Toyota Camry? Is that what you said I’m allowed to buy?’
Andrew: Exactly, exactly. You know, I have this little thing that we say. I say with development, we put a man on the moon. What was that, I think in 1969. If they were able to do that back then and if you listen to the stories of what they did and their calculations and how they figured that stuff all out, can you imagine that a web developer can’t actually get your website to do some of the functionalities that you need? Everything can be done in technology. Imagine Steve Jobs or Elon Musk hearing the word no. No is absolutely not an option in business. It doesn’t exist.
James: The problem is, though, most of those were arseholes to work for, and in life they were very biased to one direction. So I think there is an element of having a good relationship with your team around you.
Andrew: Agree. I agree.
James: I will say Jobs is obviously a tyrant if you read into his stuff, and also Ford if you watch the documentary. Interesting how they get hero worship so much and I appreciate the fantastic things they did in a positive sense. But they often balanced it out with equal negative. Also, because my webmaster will no doubt listen to this podcast, I want to say I have got a fantastic webmaster and nothing is a challenge for us. We’re obsessed with things like speed and usability. And I do listen to my developer because I’m not a website developer and after eight years of building up her experience, she’s very, very good.
So some other things from your checklist – obviously we’re not going to cherry pick them all because that wouldn’t be very fair. But I want to also dwell on an area that I sort of talk about a fair bit and I did a recent podcast on this topic and that’s around the offer. Because when I first heard of you and was looking at your stuff, it was apparent to me that you’re not going to get to 200 million dollars a year revenue with a crappy offer, or can you?
The first step of the whole thing
Andrew: Well, you know, everything, in all the niches I’ve built, we’ve always had to have a good offer. I think that’s critical. That’s the first step of the whole thing and to me as part of the good offer is you got to have good copy – great headlines, great imagery, great messaging, benefits, features – those all need to be in there. And I’m an old school, in my mindset, I’m a direct response marketer. I’ve run a lot of stuff on TV and I really understand that old school mentality and that’s about building the right offer. If you don’t have the right offer, you can’t get out of the gate. So it’s definitely really important. I think a lot of people get lost in the offer and they don’t even know maybe what their offer is and are certainly not conveying the message of an offer quickly enough when people come to their site.
Andrew: Exactly, exactly. The way you got to look at it, we sometimes even do stuff in the office where we’ll stand back and look at a screen and see, if you were just walking by, do you get what the offer is? Do you understand in a very quick period of time of just looking at an image and looking at a headline and that’s about it? Do you have the gist of what this offer is or what this page is about? So the offer is absolutely critical.
James: John Carlton, the copywriter, tells me about Gary Halbert and how he used to run the offer over and over and over again to everyone he spoke to until they were really curious and asking more about it or wanting it. And that was when he knew he was onto a winner. And Bond Halbert confirmed the same.
Andrew: He was amazing.
James: I did episode 551 on Your Offer that Converts because I think without an offer, you’re going nowhere. So when we were talking about the things on your checklist that I’d be zooming to, I liked the offer because small changes there can make a significant difference to your ability to survive in business. And once you get an offer that works, then all the fun stuff around optimizing that offer and scaling that offer, they just compound the win. But if you can’t get that offer out, if you can’t get that offer to convert and you run out of cash flow before you make the end of the runway and you just can’t take off, then you’re going to ditch the plane into the ocean.
Andrew: I agree.
James: You’ve got to find it. And you will burn fuel. You know, I’m constantly amazed how shocked people are that their first campaign ever on Facebook doesn’t convert and they’re losing money and they’re surprised by that. How much time or resource do you put towards finding the offer that converts when you’re starting a new venture?
Andrew: Here’s the thing, I mean obviously, we try to research a niche and we try to see that there are people already selling it. One of things that I like to do is, if we’re in a business that there are other guys that are running successful offers out there, we look at what they’re doing. A lot of times we’re not trying to recreate the wheel completely, we’ll look at other successful offers and we get ideas from that. So that’s always like the first starting place of how we build an offer, is looking at competitors and doing our homework and our research in the marketplace.
I think another thing though, in talking about the offer as you’re saying, and this is another point that I talk about on the list that I’m not trying to refer back to so much but it really ties into the offer from when you were saying about Facebook ads and guys saying they were expecting it to work and it didn’t work. Another area where I see that it ties into the offer where people make a big mistake is what I look at as sort of their conversion alignment and they run ads that are not relevant to what actually is on the page. So there’s such a disconnect in what they’re saying in the ad and then when someone comes to the page, it’s like something else. If you don’t have that right, the offer can’t even work properly either. So you know, everyone who’s running ads on Facebook, we always do a really good job of that. We make sure the ad is very, very clear so when someone comes to that page, it’s not like, ‘Oh, this isn’t what I was expecting.’ You’ve got to have that synergy there. And it’s really, really important.
“It’s all about providing the relevant information to the search and the ad.”
And you honestly get rewarded for that too when you do a good job of that and you’re providing the right value back to the consumer, even when you were talking earlier about SEO, I was saying I’m not a fan of it anymore because unless you’re producing great content like you do and not everyone can do that, but the reality is today, I think actually it’s easier than ever because it is all about providing the relevant information to the search and the ad and when you provide that relevant information of the offer to match the ad, Google rewards you, Facebook rewards you, your ad costs go down and actually the same thing happens like we’re talking about in SEO, you can actually rank more in SEO because you’re delivering exactly what those platforms want to provide, which is the best possible experience for their users.
How important is spelling?
James: Yeah, exactly. And how important is it to have things like spelling on your website? I am often curious about that if it makes a big difference or not. I know that Joe Sugarman used to have typos in his ads all the time and they actually got higher conversions sometimes. They eventually had fun with it, asking people to find them.
Andrew: I think it’s something you can play with. We, often, in the stuff we do, I’m probably a little bit of too much of a perfectionist, as you could probably hear a little bit. I’m the guy that’s very specific in the way I look, in my style and everything about me. So having a typo, if I know about it, drives me insane. If something’s off on alignment, I mean I sit sometimes James with my developers and designers and you know, I design something. I really sit with the designers and I watch them, I’m like, “Move this, change this, move this,” and I get the page all laid out perfectly how I want the PSD file and then I give it to development and development doesn’t bring that to light exactly as how I envisioned so that the experience on the Photoshop file that we built matches on the website, I am freaking out. If something’s crooked and not in alignment and headlines aren’t right and the words don’t flow, I’ll spend what could be sometimes hours just trying to find the right word to make sure it just all ties in perfectly together. So I’m like a lunatic with that stuff.
James: I thought you would be. I noticed you have professional pictures and some styling happening there. So it was clear to me that design is important to you. When I first saw your picture, I thought you’re like the good looking version of Will Ferrell’s doppelganger. I did notice one spelling error on your home page and I wondered if it was intentional or not.
Andrew: Here’s the funny thing, when it comes to my own personal stuff, it’s very hard for me to have the same sort of objective point of view as I do when I look at our businesses that are not my personal thing. It’s funny. I was just having that conversation with my wife about this and like it’s so weird. All my personal stuff, I just don’t give it the same level of detail as it when I look at a client’s business or one of my other businesses, I am a lunatic with that. So sometimes it gets hard to look at your own stuff objectively. It’s much easier to look at other things objectively.
James: It’s so true. I know we’ve got spelling errors and some of the quotes on my videos occasionally aren’t perfect English. And the thing is I’m not looking at my own stuff. I think that’s the great power that we have when we’re working on someone else’s business is we have laser beam vision. We see everything that they see. They’re walking past it every day and either they’re not looking at it at all or they’re blind to it even if they are. It’s like banner blindness. So it’s totally a reality. But I was just curious about it more than anything.
I wanted to ask you just a few more questions. You’ve been super generous with your time and I think we’re having a bit of fun discussion here learning some of the things but I’m getting the picture that you are very interested in conversions and speed and research and getting your offer scaled.
And I’ve got a really good feel for the sorts of things that you do bring to the table for your customers as well and your own business. Obviously, it’s evident with the number of subscribers that you have and the number of the sheer amount of revenue that you’re generating, would advertising be the single biggest cost in your business?
What’s the biggest cost in business?
Andrew: Well in the phone business, it’s the handset.
James: So it’s a hardware cost.
Andrew: That’s a hardware cost and it’s not a cheap cost. So the program’s evolved and it used to cost us quite a bit less to acquire phones because we weren’t actually giving out smartphones, but now we provide literally a brand news ZTE smart phone to every single customer that signs up. So you know that’s changed. Our advertising cost happened to be much less than the hand cost than the cost of the handset. But that’s not always the case in a lot of the businesses I’ve run online. Usually the advertising cost is the most expensive cost in the business.
James: It’s usually that or wages depending on the type of business. If you have a service business, it can often be wages. If you had an ecommerce business, it’s definitely hardware or you know, the physical goods can eat up a huge amount and then you have other inventory challenges like obsolescence, shrinkage, logistics, nightmares.
Andrew: Yes. Yes.
James: I didn’t know exactly what your phone business does but that sort of makes sense. Do you lose money when you take on a customer initially, hoping to get it back over the long term?
Andrew: Exactly, exactly. So it takes us about five to six months to break even. And then at that point we own the customer, we get paid a set amount of money every month for every single subscriber we have from the actual government. What’s interesting in all the businesses that run in the past and because we’ve done all these trial offers and different things, we’ve had merchant accounts all around the world and all sorts of crazy stuff that we’ve done, in this business we sell a lot of top-ups to the customer and that happens on credit cards but the bulk of our income every month is we have one receivable and that’s the government that pays us. So it’s interesting that this model we’ve kind of built a continuity program but then the bulk of the continuity program is written to us in one payment at the ending of each month, which is really cool. It’s a very interesting and different business model. It gives us good consistency.
James: So instead of paying the government or your taxes one way, you’re getting subsidized by the government the other way as well.
Andrew: I guess it’s one way to look at it.
James: This could be the Holy Grail. You’ve found a way to make money from the government. That puts you in the rare….you know, aside from public servants of course.
Andrew: We’ve definitely figured out, and let me tell you, it wasn’t easy. If you saw the systems and the things that we’ve had to build to accommodate this business, it’s complicated, James. It’s crazy.
James: That’s the thing. When I do a show like this to suggest that every listener is going to go out there and generate 200 million dollars revenue a year, what we’re looking for is a couple of ideas and I think we’ve got some ideas here. We’ve got some tools that you’ve referenced, which we’ll list and we’ll put into a handy check sheet at Episode 555 to download so that you can go and see the tools that we’ve mentioned. You can use a little checklist of some of the things that you can go and check with your own website.
I think we’re going to just finish out. I want to ask you a question, Andrew. Of all of the businesses that you’ve started or been involved with as a consultant, what is your big lesson that you would have in every single one of those conversations? What’s something that always gets mentioned that would be a good thing for us to finish on here? A super tip if you like.
Andrew: A super tip. You know, I think that the most important thing is consistency. Creating things that are repeatable and I believe that that’s a lot of stuff where people go wrong is they don’t have a way of creating and running their offer in a consistent way. They have these too many peaks and valleys. I’m about consistency and how to set those baselines so you can figure out how to grow to those next level. So a lot of the businesses that I go to, they’re lost in that. They have a good month and a bad month. And I’m always about how can we look at what you’re doing and figure out how we can get consistencies in place and how to monetize your existing business.
“The best customers are the ones you already have.”
And that’s probably another big tip that I’d say, most people, if you have an existing business, the bulk of your business or a lot of revenue you have, the best customers are the ones you already have and I think that most people forget those. So when I come in and look at a business, I help them get consistency by trying to generate more revenue from the customers they’ve already acquired. It’s hugely important. Everyone’s always on to the next, on to the next. It’s the ADD world today. And it’s all about the new customer. What about the guy you already had? He’s already spent money with you. He’ll spend a lot more money with you again. If you put the right systems and the right consistency in place, they’ll spend more money with you.
James: Yeah. We’re on topic there, Andrew. I just did a post on Tuesday this week, just a few days ago called How to Instantly Double your Business and I put that inside for my members inside SuperFastBusiness. And I actually put four steps and it absolutely focuses on doing more of what’s already working for you, in particular your existing customer base, like how you got them, what they bought and focusing back on that and reinvesting that process.
Consistency or Leverage?
I wonder if you meant consistency or if you meant leverage in terms of repeatable things. I mean they’re quite leveraged. But when it when it comes to consistency, there is an odd thing that I’ve been observing. On my desk here is a PlayStation game that I’ve been waiting for about four years for. They’re very inconsistent but I’m sure they made a lot of sales when they eventually launched it. And then I look to things like Game of Thrones. They don’t seem overly consistent. There’s a huge gap between seasons and then poof, they launch it all and it just goes nuts and they command the attention of every living person on the planet.
I think there’s a risk of consistency that you might also reduce potential peaks. I’ve done a fair bit of research into guys like Eli Goldratt and the theory of constraints and putting artificial limiters like a linear graph projecting the future that a lot of companies do, can sometimes reduce the amount of upside that you may get if you were to be more open to big peaks and to of course have contingencies for the troughs. It’s pretty radical thinking. What do you think about that?
Andrew: I’m all for that. It’s interesting. There’s a new business for us, this gift basket business is a great example of that. The business does about 45 to 50 percent of the entire yearly revenue in one month coming up literally. We’re talking about over seven figures that happens in this one-month period of time. There’s the peak. And you can’t fight the peak. You don’t want to fight the peak. You want to try to ride the peak as much as you can. So, I’m all about the peaks. But when I say consistency, I mean it’s really about the consistency in terms of your procedures and what you do to run and operate your business. That’s the consistency on your monetization. It’s consistency on your testing. It’s the consistency on how you put things out. But certainly, you want to ride the highs and lows.
James: I don’t know about that. I’m not consistent with how I put things out.
Andrew: I mean testing.
James: I’m not going to bore my listeners.
Andrew: When I say put things out, I don’t mean content. I mean consistently with how we put things out when we launch new things, and we test it.
James: Oh you mean having brand guidelines and values that resonate with, the customer immediately recognizes this is you, they’re familiar with your style and the way things come to market, like Mercedes-Benz.
Andrew: Right. That and but also I’m really actually talking about on the testing level again, because I think so from the technical side.
James: You’re a testing nerd. I love this.
James: You remind me of Ryan Levesque a little bit. He’s extremely similar to you in his attention to detail and passion for spreadsheets and technical nuances and micro degrees of variations. I think that’s obviously a key to your success.
Andrew: Yeah. Yeah, for sure. It’s definitely worked for us. And you know, I’m not the guy, I’m not looking at a million different spreadsheets. If you look at the charts consistently enough, and I look at like live traffic on our sites. Let’s say on the Q Link site there could be eight or nine hundred people live simultaneously on it. I’m watching that and then I’m looking in Chartbeat and I’m seeing what percentage of those people are in the middle of a sign-up process, and I can tell, before something goes wrong, I can tell you something’s wrong and I’ll walk into the CTO and say, “Yeah, something’s not right. My conversions are falling.” And he’ll be like, “What are you talking about?” Because I look at just some basic reports on a regular basis that you get like a Spidey sense. So that’s how I look at things. Honestly, I’m not crazy. I’m digging into spreadsheets. I just can look at a glance and I know because I’m looking at it so often that I can see when something changes in a second.
James: Perfect. Well that’s a good way to end, Spiderman. So Andrew Lermsider from reviewbyandrew.com. It’s been great having you on the podcast, having an interesting discussion. Two guys here building businesses, helping others, having a bit of fun, but also very different. It’s really good. I appreciate you sharing your insights and I’m sure that you’re going to continue adding some millions of dollars worth of revenue to that huge machine you’ve built. Congratulations.
Andrew: Thanks, man. I appreciate it. It’s always fun to share the knowledge and help other people get through things faster.
James: There you go. If you’ve enjoyed this episode and you think someone else might enjoy it too, perhaps share it on social media or leave a review at SuperFastBusiness on the iTunes store to help other people realize they should be listening to this too. And look forward to catching up with you on a future episode.
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