The more I grow into my career as an entrepreneur, the more I realize "selling" is the most important skill to succeed. There are many ways to sell you (the person) and your product, and today I want to explore one of the frameworks I recently came across. My goal is to use this framework to come up with an irresistible offer I can send to our user at Stock Card to convince them to start a 14-day Free Trial for our Full VIP offering.
The idea comes from Alex Hormozi, the founder of several of companies and the author of $100M Offers book (This is an affiliate link). He teaches entrepreneurs to create an offer that people feel stupid not accepting. A good offer creates a vacuum around your product. It "de-commoditize" it in a way the customers feel they are buying something so special they can't get anywhere else and they don't compare you with others.
Is The Market There?
Before we getting to the offer itself, I want to reiterate something Alex has mentioned in his free courses on its website, Acqusition.com. To succeed, you need at least a normal market that grows with the population. There needs to be people in this market that have a pain to remedy, and can afford to pay for your services or products. You need to have away to access them (e.g., via a list or social media platform). I went through this exercise about Stock Card's market and it helped me validate I'm on the right track.
In the case of fundamental stock market investors, I stress tested our market against those criteria:
Ideally, per Alex, by specifying the niche, we should be able to charge higher. In Alex's words, there is a big portion about pricing your product. I believe what he talks about and how he explains the price itself equates with the perceived value of the product. However, I would want to put pricing exercise aside. If the improvement of the offer works, I'll come back and revisit the pricing.
Craft The Offer
If we've built a product that address the needs of our niche customers, why the conversion rate isn't as high as we hoped. We have two conversion points at Stock Card. 1) Visitor to user conversion, and 2) User to paying user conversion. Our first conversion hovers around 30%, and the second at around 2%. From what Alex says, we can improve the perceived value of our product and improve the conversion out of the thin air with crafting the right offer! I'm drooling over this.
His formula for creating such an offer has two parts:
To reduce the risk associated with the offer, you also have two tools available: 1) Reduce the time it takes for the user to achieve the dream outcome (or at least show the progress), and 2) Reduce the amount of sacrifices they need to make to achieve the outcome.
Let's see how this applies to Stock Card's VIP subscription. At Stock Card, our goal is give our users, the active fundamental investors, the ability to generate higher investment return. We do that by providing them digestible investment insights that helps them make fewer mistakes and better investment decisions faster than what's possible without us. The internet is noisy and chaotic, and focusing on the information that matters is time-consuming. We use design and data automation and a deep knowledge of fundamental stock market investing to give investors the insights they need and understand. The desired outcome is higher investment results. But there are issues with that. It's hard to prove that every user is likely to achieve that outcome, because we don't control the market, users, their time-horizon, and their behavior in terms of sticking to their plan. Also, by nature high investment return requires long time gap between when the research is done and when the return is achieved and the user has to make a lot of sacrifice such as tolerating the pain of losing money. That's why people tend to be easily convinced to pay for stock-pick alerts and technical analysis that is short-term by nature, vs. what we do at Stock Card. How can we address those?
Define the Dream Outcome
The formula here is to XX [specific outcome] in YY [Time Period] without [biggest pains and fears]. Let's try a few options for Stock Card:
And, this is the Dream Outcome pop-up:
Once the dream is defined what are the excuses that the user may to not accept the offer we are making to them. What prevents our users to accept that we can help them with their fundamental analysis without spending too much time on the internet, reading articles and googling things?
The reverse side of it that what do people need to do to achieve the outcome:
Now the question is how can we solve those problems with Stock Card?
Crafting the Offer
According to Alex, products and services are on two apposing continuums. They are either 1) easy-to-sell but hard-to-fulfill (such as the I give you best stocks model such as TMF, or 2) hard-to-sell and easy-to-fulfill (like Stock Card that is hard to sell because there are still work to be done by the users and sacrifices to me made on their behalf to achieve higher investment return, but once sold, it's easy to fulfill because its a software).
Ideally, we want move Stock Card to a done-for-you model but also easy-to-fulfill which doesn't need lots of analysts and readings to fulfill the promise. Interestingly, that's where partnership with financial creators were supposed to come in. We were supposed to add TMF-like service without the difficulty of running done-for-you operations but it didn't work for now because the creators weren't engaged or incentivized enough to make the model work. In other words, we either had to give creators the distribution to grow or the money to compensate them, and the money was too expensive. I'm going on a tangent here. Using creators without having the distribution turned out to be too costly and didn't solve the fulfilment issue of done-for-you solutions.
Back to the "crafting the offer" I should be able to offer "done for you" model, and then once we make money and then gradually move it to "do-it-yourself". What are some of the things we can do for making the offer "done-for-you" model?
Here, let me stop and think. What if we cancel the entire Stock Card for fee and then and only charge for high-value support and one-on-one coaching at a price such as high as 10X the current price, what would it look like? It is a scary thought, I have to say. We lose our current revenue stream, but we may be able to make even more money that what we make right now by offering that super high price point model.
What's the rush, though! I can test things out first and then move into that model. The current price-point we have doesn't allow me to do the super hands-on things such as on-demand research something together. But, using templates, I should be able to sweeten the deal and improve the value for the current VIP offering. The beauty of templates is that we can still do it once and deliver it to millions, so its only the upfront investment that costs me. if it works, then we can reduce the price to allow for more conversion, and also still work on the very high-ticket price offer after, especially because more high-value stuff take time away from creating content and acquiring users. Some food for thought to figure out whether those high-touch, high-value stuff is worth offering.
Alex recommendation is also to avoid providing several high-value, high-cost things. Continuing on that chain of thought, we can offer one thing such as a one-on-one portfolio review which is a very high-cost offer.
Here, I pause. I plan to create the content that allows us to make our offer to VIP users irresistible. I'll be back with an update soon.
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