Economic Crisis - time to panic or time to press ahead? While challenging and painful, there are huge opportunities right now. Some of the world’s most successful companies grew leaps and bounds during recessions (Toyota, Kellogs and many others). On this show investor, mentor and brilliant marketer and entrepreneur Roland Frasier and I talk about what you need to do to survive and thrive right now. From getting your head right, to ensuring financial stability to how to market your product - right now. The market has shifted but money is still up for grabs. Here’s what we cover:
- Understanding the physiological segments of the market and how to reach customers that are still actively buying now
- How your product positioning should pivot during times of extreme uncertainty
- How companies like Toyota and Kellogg’s crushed their competitors during a recession
- How to secure financing right now
- What to measure and how to measure to keep your head above water
Roland Frasier - CEO at War Room Mastermind
Business Lunch with Roland Frasier Podcast
Mentioned in this episode:
Roland Frasier’s Facebook Page (This is where you can find the live videos)
Consumer Segmentation Study and Matrix - Harvard Business Review - “How to Market in a Downturn”
“To Be or Not to Be Intimidated?” Book by Robert Ringer - Amazon
Forbes article Roland Frasier referred to
Episode Transcript
Brett:
Well hello and welcome to another edition of the eCommerce Evolution podcast. I'm your host, Brett Curry, CEO of OMG Commerce, and I am super excited about today's guest and I'm really looking forward to the topic today. It's going to be timely, it's going to be helpful, it's going to be motivational. And so my guest is really truly a legend in this space, kind of needs no introduction, but I will intro him for good measure.
Brett:
Hey, Brett Curry here. Before we dive into today's topic, I want to talk quickly about YouTube ads. People ask me all the time, what makes for a great YouTube ad? And it's true, the ad is the hardest part for getting YouTube to work. Now, I love the campaign structure. I love audience targeting and I love tinkering with bids and using the smart bid algorithm. And I even like budget management, I like all that behind the scenes stuff, but I've seen it time and time again where the exact same campaign structure just limps along with a mediocre video, but you get the right video with the right message that resonates with people and that same campaign structure just takes off, it scales.
Brett:
And so over the last couple of years, my team and I, we've been collecting good YouTube ads. We've been watching, we've been paying attention and looking at our own clients, looking at the numbers, finding what are ads that resonate and work on YouTube. And so we started building this little guide, this little guide that we use internally and we started categorizing ads and giving them fun names like the manifesto and the UGC mash up and the have it all. And so we start kind of breaking down what elements in these videos make them work.
Brett:
And so I was speaking at a recent event and I just happened to mention that this resource existed and people sort of clamored for it. Like everyone's like, "Hey, I want to see the guide, I want to see that resource, I want to see all these successful ads." And so, that's what we've done. So we put together this resource kind of first time ever, get to share it with a broader audience. It's free. So check it out and get our list of winning YouTube ad formulas with lots of examples. Let this be your inspiration for your next killer YouTube ad. So it's a free resource, we'll link to it in the show notes to this show, but you can also go to omgcommerce.com, click on resources and then guides and it's the YouTube ad templates and guide. Check it out and I hope it inspires your next killer YouTube ad campaign. And now back to the show.
Brett:
I've got the Roland Frasier on the podcast today. I was just telling Roland before the call started, he's the host of one of my favorite podcasts right now, the Business Lunch podcast. I highly recommend it. Great guests, great topics. It comes up multiple times a week. It's fantastic. You also probably know Roland from the Traffic and Conversion Summit. He's a partner in that and with Brandeis and digital marketer, also CEO of War Room, a fantastic mastermind, which is actually the reason we're doing this podcasts. This all came because of a War Room call I was on and I was like, well, we got to do an episode for eCommerce Evolution and Roland agreed to come on. And Roland is just one of those guys, just super smart and has his hand in a lot of things, knows a whole lot of things and so thrilled to have him on. And so with that Roland, man, welcome to the show and thanks for taking the time.
Roland:
Yeah man. Thanks for having me, I appreciate it.
Brett:
Yeah. So we were on, I was listening in as you and Perry Belcher were going through a War Room call, which by the way, it's times like this, he knows we're all kind of going through this crisis and figuring out what to do that things like masterminds become even more valuable, because a few weeks ago like, you could get kind of fat and lazy, things are going really well and now it's like, hey, we need these communities, like mastermind groups, so kudos.
Roland:
It is funny that in good times they're great because everybody's kind of sharing what's working and all. But then when things go a little bit the other way, it's nice to have people that you can count on and say, hey man, I'm a little concerned about this. What can I do?
Brett:
Yeah. I mean, they're good in the good times, are almost necessary in the bad times if you can swing it. So I particularly liked what you and Perry were talking about on the call. And so I think to kind of set the stage, so we're going to be talking about how do we market, how do we grow in a downturn, in a crisis? How do we navigate these waters? We'll get into a couple of different subjects that you know a lot about. But I think to start with, let's talk about mindset. So how are you approaching this crisis and how are you instructing War Room members and clients and friends? How are you instructing them to look at this crisis from a business perspective?
Roland:
I mean, it's everybody has their own reaction to things. So we can't ever instruct. We can only say, here's some things to think about, right? So the way I like to approach that is just to say, here's some things to think about. This is not an unusual thing to happen other than the way that it was precipitated, right? We're not generally big on pandemics here in the States, I don't think we've had any. But over the history of our country, I was talking to Jay Abraham the other day and he said, this has happened 48 times, in terms of recessions in the history of our country.
Roland:
And I know that for me personally, I saw as a kid, I saw the one in the 70s and then there was one in 1982s and bad things happen then. And in the 90s and then in 2000. And then the big, where they call it, the great recession, not the great depression, the recession, in 2008, 2009. So like the fact that business is cyclical is no surprise.
Brett:
It's always going to be that way. It's always been that way, it will always be that way. Really the only thing that's novel about this is the pandemic.
Roland:
Correct, right? So if we take that out and say, okay, we're going to just look at things have changed, but this is really unusual because this has been a change that probably wasn't going to happen. And I think probably won't continue once we get to open our doors again, because it's 3.2 million, I think, people filed for unemployment last week, which they said the highest before that was a 695,000 people in 1982 and 665,000 people in I think 2015. So do you remember having like giant trouble in 2015? You know, probably not. But the thing to think about is that, that's only because, it's not because like people, like business stopped. It's not because business stopped organically anyway.
Brett:
Right.
Roland:
It's because we're literally telling people you can't open your business right now, which we all know-
Brett:
Yes, stalking it around. Yeah.
Roland:
Yeah. And we all know that that can't last, but that eventually the public is going to say, you know what? If we're going to die, we're going to die. And I'm not saying that to tell people to go out and about, I'm just saying, we are not as human beings inclined to live in confinement. And if you look at all of the flatten the curve studies and all of that kind of stuff, they say, we really, if we can just, on the average I would say is three or four months of this on a bad kind of side, on a, not a worst case, but on a probable, most likely bad case as far as how long we have to stay in this kind of environment.
Roland:
Well, that's going to just ... That means that all of the demand is pent up. It didn't go away is to just, hey, we can't travel right now. We can't go into our office right now because we'll die. So I guess the first thing that I tell people is look, this is an artificial situation. And so the reality that you're in right now is not a reality that's likely to continue for any extended period of time. So the first thing then that you might think about is, can I survive from the date of today through the date when things start to return to normal, because when they start to return to normal, then you can start doing whatever it was that you were doing before. That was feeding your family and making you rich or getting you by.
Roland:
And so then if you think about that, it's like, okay, well this is kind of like, it's a weird combination of a startup, a turnaround, and a recession. In a startup we have runway, right? You say, okay, we're going to start a business, I need to fund it.
Brett:
Yep. me a long hand.
Roland:
Yeah. And I can fund it. What's my burn rate? Well, my burn rate is $10,000 a month or whatever your burn rate is, right? In a startup, my burn rate is $10,000 a month. I've got $120,000, I have a 12 month runway before I run out of capital and somewhere along that way, ideally before I hit the end of the runway, which is a brick wall for most of those startups, right? Where I don't get to continue my business anymore, I either have to make enough profit to get additional runway or I need to raise capital or borrow capital to get additional runway.
Roland:
Well, it's nothing different here in terms of your survival of your business is you have to look right now and say, what's my burn rate? What is the amount of money that's going out of my company? What is the probability of money continuing to come in, at what rate? And then you say, how much money do I have currently divided by my burn rate, my net burn rate, meaning my revenue, less my expenses. And then that tells you how many months you got. Now, if you do that and I've walked through that like ... Actually Perry too was telling me he went through this with one of our War Room members that was freaking out. They were like, "Man, everything's going to crap. I don't know what to do." And well, it turns out that they had 108 months of runway.
Brett:
That's probably going to do it. I think we will safely be out of quarantine by then.
Roland:
If we're not out of quarantine by then, we're all going back to caves and it doesn't matter.
Brett:
We're all screwed at that point and you don't have to land.
Roland:
Yeah, we're all screwed.
Brett:
It's on mad max at that point.
Roland:
Yes. So I think it's like, that's the very first thing. And then you say, okay, well what are the things that I can do to extend that runway? Well, one of the things that we talked about is can I get additional money? And the easiest way to do that right now, and particularly in the short term, if you need more money, is to go borrow it. And there are companies that will do multiple credit card applications at the same time. It's like, if you need money in the next couple of weeks, then go to one of those companies and get yourself $150,000 or so.
Roland:
Typically you can get 50 to 150, depending on your credit and that's cash. Like you just do cash advances. Now the SBA has been funded and depending on which version of the bill gets enacted, there's like, I think last time I read it was 357 billion that's going into funding small businesses and 50 billion-
Brett:
Are you going to read all versions, Roland, just so that you're ready, like all 880 pages?
Roland:
Never, no, no. I'm going to look and see what they're saying, but yeah, I never ... It's really funny how people don't understand how law works is a bill is something that is not a law until it's voted on and approved by both houses of Congress here in the United States. If you're watching from the United States or listening, and then signed by the president, and so a lot of people get all, okay, well this bill says this and this. But the chances are it's going to change quite a bit before it finally gets through.
Roland:
Now let's say that it goes through or doesn't, no matter what, there is money in the United States, in the small business administration, and they have a loan called a 7a loan that will allow you to get $350,000, that's an accelerated procedure, typically 30 to 60 days versus the four to six months it takes to get one of the bigger loans. But those bigger loans right now that they funded, the terms are two to 3% interest with a crazy year payback, right? So all of that and however that shakes out, doesn't matter. All that you need to know is the principle is go get some money, right? Go get some money and people are saying, "Well, but I don't know if I'm going to need it." You're going to need it, right? Assume that you're going to need it.
Brett:
Assume that you are going to need it so that it's available. Absolutely.
Roland:
Wouldn't it be better to have it and not need it than to need it and not have it. And even if you don't need it for your current operations or to extend your current runway, it will be helpful to acquire other businesses because not everybody is going to make this, right?
Brett:
Absolutely.
Roland:
Not everybody listens to your podcast. So I think that's the very first thing. And then the second thing that I tell people is, if you need money that is ... If you need more runway then the other way to get it is to think about your current expenses. And so this is where the startup looking at runway goes to turnaround. And in a turnaround situation, like if I go into a business to turn around, the very first thing we do is we go and we say, okay, we need a 14 day inflow outflow of cash forecast and we need to know everything that's coming in and everything that's going out. And are we net positive or negative? And then what do we have to work with? Right? So it's a kind of a proactive version of the runway.
Roland:
Now, I know that at our company, and I'm talking about one of our companies that we go through at Digital Marketer, we'll find every quarter, 20, $30,000 a month of stuff that we're not using anymore. That we either got and said yeah, this is super cool tool. We're going to do this at some point, we never did. This is super cool, we're going to use it. It doesn't work. It's like ... So there's just so much fat that is typically, that has kind of built up when times are good, you're not motivated to get around to it. You've got other things you'd rather go out and make $100,000 than save 15, right? And that's actually smart. So that's the next thing is doing that cashflow analysis. Do a 14 day cash analysis and then do a 90 day week by week. So your 14 days is day by day. Your 12 weeks is week by week after that, and that probably is going to get you through what we're looking at right now.
Brett:
I don't think so.
Roland:
Yeah. And then you go-
Brett:
Especially for eCommerce, because I think one thing to keep in mind, and I know that the degree to which people are experiencing pain in the eCommerce industry does vary pretty wildly based on what they're selling. But we have a lot of clients right now. I ran a report a couple of days ago, like 60% of the clients in OMG are actually growing, even through this downturn because some consume, consumer shopping is shifting online and there's still some goods and in categories that are down, no doubt about it. But I would agree with you, I think if you have that 12 week plan, hopefully things will kind of begin to turn. And I think eCommerce is going to come out better than most from things experienced.
Roland:
It should. Yeah. I think the only, like your biggest risk is somebody like Amazon, if you're really dependent on Amazon and they say yeah, we're not taking that anymore.
Brett:
Right.
Roland:
It's like, really, you're just not taking it anymore?
Brett:
And that's been crazy. We've been dealing, so we have kind of our Google and YouTube side of our business, and then the Amazon side of our business. And our top sellers, almost all of them have been scrambling as of late because either, well, Amazon's not taking their shipments into the Amazon fulfillment centers, but now Amazon's saying, we won't even ship your goods. If we have it, if we have it on hand, we're not shipping it to customers until end of April or May, and it keeps getting delayed. So it's forcing Amazon sellers to say, well, I'll just do fulfilled by merchant then. And that's actually a good move in a lot of ways. So again, it's like painful. It's causing people to scramble. They're losing some sales right now, but it's forcing them to diversify and it's actually could be a good thing in the long run.
Roland:
Yeah. Now what I don't know, and you probably do is, is Amazon moving? If you've got goods there, will they move that to your other ... I mean, you're just locked. They've locked down. They've got your property, right?
Brett:
Yep. That kind of sucks. Yeah. So if you've got your access to anything, at least that's my understanding.
Roland:
They're probably going to be some lawsuits that they're going to have to deal with then, because-
Brett:
It could be.
Roland:
... If they cannot give you access to your property and they can claim force majeure, but like to get actual access to it, would be interesting to see what happens with that. I bet there's going to be some, there probably some attorneys right now going yeah, keep it.
Brett:
Exactly. Coming for you Bezos, coming after you. Yeah, exactly. So the 12 week plan, I think that's going to get a lot of people through. I'll let you continue there.
Roland:
Oh yeah. So then you look and say, okay, well what can I do to accelerate the inflows of income and it's been fun to watch all of the different things that people are doing on the marketing side. Right now, I'm just talking about the finance side. And on the finance side it's okay, can I, if I've got accounts receivable, which a lot of people that are selling online don't have accounts receivable, but if you do, then can you offer people a discount to pay sooner? Are there things that you can do to accelerate payments in any way? Can you do bulk or discount or bundle or anything else that encourages people to pay sooner as opposed to paying later or, to dis-incentivize people or to incentivize people to act now as opposed to putting off. And so you see a lot of people doing that. And even Warren Buffet said, "One of my favorite things during the time of recession is to buy durable goods because you've got risk."
Brett:
I love that, so smart.
Roland:
Yeah, right? He's like, look, if a couch that I was thinking about buying is 50% off right now, and I save $1,000 on it, and then I invest that at 12% for 40 years, that's worth $50,000 or something ridiculous to that.
Brett:
Yeah, exactly.
Roland:
I love the way that guy thinks. And so if we think like that, and I'd probably be using that if I was selling durable goods, I'd probably say, why don't you follow the Warren Buffet sale or something like that.
Brett:
That's brilliant, it's brilliant. I love it, yeah.
Roland:
So that, like all of those things with finance to me are the things that will help us stay because it's the people who have the cash to be able to survive pass what we call the survival line, right? Whenever this phenomenon ends, are the people who are going to be positioned to grow the fastest and get ahead the most. So that's, like that's finance advice and I can go through the other stuff, but it's kind of long. So I don't know if you want to do that.
Brett:
No, that's perfect. And then let's talk about a few elements of what we just covered and then get into some marketing topics as well. But I love this because, and we always want to be sensitive to what's going on and there's a lot of pain, there's anxiety, there's fear. All those things I think are perfectly normal and justifiable, but I think as leaders and entrepreneurs, we have to pull ourselves together and get our heads right and see this for what it is. And I had a call with a friend of mine today, he's an eCommerce merchant, sells on Amazon, but sells through his on websites and stuff. He's like, "I don't know, man. I'm just, I'm seeing this as an opportunity." Like it's just, it's an opportunity.
Roland:
It's an opportunity.
Brett:
My sales are up, because he sells an item that people can use at home and especially kids that are bored can use at home. And so he's selling like gangbusters. He'd already started some of his fulfilled by merchant activities, so he's able to pivot and use that. So he's seeing it as an opportunity. And I remember hearing several people even just a few months ago saying, right now the best advice is sit on cash because the economy's so good and then you're looking for opportunities when the next recession comes. I don't think anybody thought it would be like as soon as it is or happened the way it did.
Roland:
Next to me.
Brett:
Yeah. But if you do have a good cash position and you can make it through that survival line, like you talked about, there's big opportunities, like there's huge opportunities. Yeah.
Roland:
Absolutely.
Brett:
And so let's maybe ... I want to mention something else too, just because I'm a huge fan of this guy. You mentioned Jay Abraham. You guys did a ... Did you guys do a Facebook live together recently?
Roland:
We did, yeah.
Brett:
Is that available globally or is that like to a select group?
Roland:
No, it is. We're doing everything right now that we have that would normally be part of a group or something like that, we're doing open to the public. As a matter of fact, Jay and I just started a thing called the Strategic Alliance where we are basically providing question and answer type stuff for entrepreneurs. And so that, we bought everybody that was on that call, the first month of it.
Brett:
Nice.
Roland:
And it's kind of fun. Yeah.
Brett:
Awesome.
Roland:
So we're just answering questions and it's kind of fun to have him who, I remember when Tony Robbins was a client of mine, when I was practicing law, I got a letter from Tony that was a Jay Abraham letter about this, it might've even been a Mr. X thing.
Brett:
I remember that, yeah.
Roland:
And it was $500 for the book. And I was like, "Oh man, $500." And I bought it, I was like, "Ooh, this is great." So it's kind of fun to have the opportunity to work with Jay now and do stuff together.
Brett:
It's very cool.
Roland:
Yeah, and if anybody goes to ... You can go to my Facebook feed and just search for Jay Abraham and it should come up in there. I think it was Monday. Right?
Brett:
Okay. And I'll link to it in the show notes as well so people can access it. But it's so interesting. When I was in college, my uncle kind of stumbled on the Jay Abraham. And so believe it or not, he bought a bunch of Jay Abraham stuff and sent me these cassette tapes. Now, I was in college in the early 2000s, so cassettes were old at that time. But I was like, I just devoured it. And you mentioned Strategic Alliances, like that was the part of marketing where I was like, this makes sense. I like this a lot. And so we've actually utilized that mindset to grow OMG Commerce. I've used it to grow other businesses, like it's so smart and I'm a huge Jay Abraham fan. So I'll link to that in the show notes.
Roland:
Great, yeah.
Brett:
But check out that business and that offering, it's really cool.
Roland:
And what's cool about that for everybody that's listening is we talk about, like it was just open Q and A. And so we had people from eCommerce and everything else just asking questions about, what should they do? And it was fun just giving, here's what we see working and all the different things that we have access to and here's some ideas and things like that. So it's a good place to get inspired for what you can do if you're feeling like you don't have anything that, any options right now.
Brett:
Yeah. Awesome. So let's talk about marketing a little bit, in the warm call from a week ago or early in the week whenever it was, I don't know, it's so hard to like ... My concept of time has shifted.
Roland:
It's weird when your home for like a week. Yeah, it's been, this is the second week for me, cause I know only because last Monday and Tuesday a week ago, I was supposed to have an event and on Sunday night I was sitting in the restaurant of the hotel where we were going to have the event. There was only 25 people. And was really wrestling with, I had a few people who had flown in and this was all getting ready to happen. And that was the night that they announced we're closing all the restaurants, we're closing ... Here in California. So yeah, so this is, we're coming up I think on Monday on this, the next Monday that comes after this, it will have been two weeks and it feels like it's been four.
Brett:
I know, I know. It's so funny. And I'm in Missouri and so we just went on lockdown recently and I think everything is fine in our area, but still probably smart. But it's funny, like I'll see TV commercials with large groups or people like driving down the street, like normal. I'm like, "Oh, I remember those days. I remember what life was like." It wasn't that long ago, but it just, it feels like it was.
Roland:
And now you see it, sometimes you'll see people like a press announcement or something like that and there are people all together and you're like, are you crazy? You're all going to die.
Brett:
It's funny how the new normal shifts pretty quickly. But so on this warm call, you were talking about looking at different segments of buyers and how, well, yes, there's some consumers who have freaked out. There's a lot who have not, and there's a lot of people out there that have money, that have resources and they want to still buy things. In fact, buying things is therapeutic and it makes you feel normal and people crave that right now.
Roland:
Retail therapy.
Brett:
Retail therapy, yeah. What was it that Ryan Deiss said that consumerism is like the number one hobby in America or something like that. I don't know if he just made that up or if that's like a real thing, I think it's real. Yeah. So talk a little bit about that, what is your approach and what are your thoughts about how do we continue to market in this time of uncertainty and crisis?
Roland:
Yeah, I think it's really good. I did a zoom with Rachel Miller the other day who's just a bundle of energy. I don't know if you've got to see it or not, but she was saying like when she's talking to people, she asked first, she said, "Can you sell what you sell now?" Because if you can't, like if you're a restaurant and it's closed or if you're an office and the office was closed and you couldn't go remote and you can't sell the thing because you have to deliver it in person, then that's a different kind of situation. So I liked that as an initial filter to say, can you sell what you used to be able to sell? And if you can, then can you pivot? Is it in demand? If it's not in demand, then can you pivot? And to help with that, I think that this, and I don't know the issue that I found it and I still have to go back and find it, but there was a really good consumer segmentation, study and matrix that came out in Harvard Business review.
Brett:
Yeah. I've got a link to it so I'll put it in the show notes. It came out around the great recession, so it was like 2008, 2009.
Roland:
Yeah, exactly. And so what they did was they said, let's look at consumer behavior in a recession. And they said it depends on the what type of customer, what type of consumer it is, and there were four categories you could fall into. And one was slam the brakes, which is, oh, I'm freaking out. No, I can't do anything. I've got to stop, I'm not doing anything, I'm not spending anything. And I was like, that doesn't last very long, by the way. But you've got that group of people and then they said there's a patient group of people. And these are, this is the largest swath of people who are, like they're feeling it, but they're like, okay, this is going to hurt but we're going to get through this. I'm not freaking out, I'm not hitting the panic button. Then, there were-
Brett:
I saw a quote today, it's kind of funny, maybe ties to that, that said this will pass. It may pass like a kidney stone, but it will pass.
Roland:
I like that.
Brett:
That's probably that group, yeah.
Roland:
And then there's the comfortably well-off and then the carpe diem people, the basically live for the day. Right? And depending on which of those categories you're in, you're going to have different behaviors for four different types of products. One type of product that is doing well and they did a, like a green, yellow and red shading. Green meant business as usual, no change at all. Yellow meant probably looking for deals or substitute products or to pay the same that they would have paid for more inferior product, but for a better products, effectively a discount. And then there's red. And in the 16 quadrants, if you took those four types of people down the left and the four types of products on the right at the top, there would be 16 boxes and only three of those boxes were red.
Roland:
Two of them, and red was declining sales and they were declining only in the two categories. The four categories were essentials, things that we basically need to live like toilet paper. And then there was treats and then postponables and expendables. And treats are things that we do for ourselves. Just some little reward or big reward that we'd do for ourselves, those kinds of products. Then the postponables would be like a new water heater or a car or something you don't have to have. And then expendables basically just kind of stuff you buy and probably shouldn't in the first place. And it was really funny because when you read the definition in the study between expendables and postponables, you're like, why do you have that fourth category? I think it's so that they had a four by four.
Brett:
Yeah, visually.
Roland:
But the encouraging thing is, is that the study which was based on actual buying behavior showed that the only people who were really going to hurt sales or the only areas that sales were going to decline were in expendables if you had a slam on the brakes people and pain, but patient people, they're kind of saying, one saying, hell no, we're not buying that. The other one's saying, probably not going to buy that now because it's expendable. I mean, we don't need it or want it. It's just kind of like an impulse buy. And then, the only other area for declining sales was postponables for slam on the brakes people. So that means that if you're selling essentials, that was all green, no changes, you're still going to sell it. No discount, no need to panic. No need to freak out.
Roland:
If you're selling treats, then people are looking, like I said, they're looking to substitute. So in your marketing you say, okay, what is my product a substitute for that's a more expensive product? And then lean into that, lean into the people who used to be buying. You should be knowing, like if your product is a substitute for some other product, you should identify what products is your product a substitute for and is your product less expensive than that? And then go after all the places those people are advertising, use Pathmatics or a similar web or Adbeat or any of those tools to say, okay, this is where those people are selling. And then go take their business away from them.
Roland:
If you are discounting, then lean into the discount and advertise the discount and if you're bundling or something like that, do that as well. And then also leaning into the messaging because if you're selling something that's essential, it's essential, no problem. But if you get into the next category of treats, then you're saying, okay, well this is what a lot of people want to do right now. This is the retail therapy. This is the, you know what? You're at home and you've cut back, but you deserve this.
Brett:
That's right.
Roland:
Right?
Brett:
Yeah. As for Firestone with Boom by Cindy Joseph, he sent out a fantastic email recently and it did really well. And then the whole premise was create a spa day at home, right? So one of the most helpful things, and this was legitimate that you can do right now is battle stress, right? So how do you reduce stress? Well, here's a way to get a little spa day at home, actually good for your health, good for your immune system, all that. And here's a little bundle on a discount to go with it. It was brilliant and it worked.
Roland:
And that's exactly what you would do. And that actually would be something that would appeal to all four classes of those consumers, right? So that's kind of exciting to know that that's there. Then if you have the postponables, you lean into, well, the only people who are really postponing like that, the only red in that category was the slam on the breaks people. So those people, that's just going to be a matter of time. But the rest of the people, then you go with the Warren Buffet thing, right? Now, there's never been a better time to buy.
Brett:
Right.
Roland:
This is to go with the deal, but tell them why, don't just knock it off 50%, say this is why, and this is why it makes sense to buy.
Brett:
Yeah. There's got to be a reason why. Right?
Roland:
Yes.
Brett:
I remember the old marketing lesson, there's always got to be a reason why. And it can be a really weird reason. You're like Saint Patty's day, that's the reason why or in this case it's, we're creating ... This is our own stimulus package, right? We're creating our own stimulus package for you, to help you, to ease the pain and let's go. What's interesting too, so as you look at that segment of buyers, right? And I like how the article talked about, it's no longer just like the age and gender and income because those categories you just described are really more psychological. There could be some really well off people that are still in that slam on the brakes, because that's just their nature.
Roland:
For sure. And broke people who are in the carpe diem.
Brett:
Like, screw it, man, I'm just going to have fun and I'm going to buy whatever and it's therapy and who cares? I'll fall bankrupt if I have to. So yeah, just understanding that psychology. But what's interesting, so we have a client and I can't reveal too much, but they're in the automotive space and it's really not a necessity what they sell, right? But they've got a large segment of comfortable but well off and they're still, but they're also positioned in their marketplace as more of a value. They've been doing super well. Like this is not something that's ... You do not need this right now if you're at home fighting the COVID pandemic, but they are up and they're up in quite a nice way. And I think part of it is like we're sitting at home, I'm looking at the car and the garage and I got a nice car and I'm just going to buy this thing that they sell and it's going really well.
Brett:
So I think also understanding that, like what's the mindset. If I appeal to a segment of the market that's comfortably well off and maybe I am a bit of a value, so I think that lines up with what you said before, where now maybe I'm looking for a value but I still want something that's good. It can be a great time to buy and I think it's been so interesting. I've heard from a few other merchants who are either on the War Room call or have been talking to Ezra lately that have said, I was kind of just hunkered down. Right? Because there's just some people that's their nature. Things go crazy and it's just, I'm going to hunker down.
Roland:
Worst thing you can do.
Brett:
But now they're realizing, no, I got to go for it.
Roland:
Yeah. And I think the other thing too is that, that struck me about the categories of product is can you reposition your product from expendable to essential, from postponable to treat, right? How do you ... Like the couch is a postponable. I need a new couch, but the couch is postponable, I can wait for, I'm just going to sit on my old couch. Right? But if it's, you know you're spending a lot of time at home right now and isn't it a time? Isn't that couch kind of not ... Like you've been thinking it's not really that comfortable and you're able to sit there and spend time with your kids or watch TV, catch up on Netflix and all, but the whole time you're thinking, I kind of deserve a new couch, right?
Brett:
Yeah.
Roland:
And you move it into treat or you move it into essential, well then you've opened yourself up to those other psychological categories of buyer in a recession. And that messaging alone can be a repositioning element. I think that's kind of exciting to play with.
Brett:
I love it. It's super fun. And I'll give you another example. The credit on this goes to a couple of members of my team, Jessica Muddrer and Sarah Edwards that we have a client and they sell big blankets and actually are called Big Blanket companies. So these are 10 foot by 10 foot ginormous blankets, so it's a hundred square feet.
Roland:
Nice.
Brett:
They have like Sumo wrestlers that are spokespeople and like the tallest guy in the NBA as a spokesperson. Anyways, so we were brainstorming or like, hey kids are home all over the country, extended spring break and school's going to start at some point, but how do you entertain these kids? And actually we have another client that sells the arts and crafts and stuff like that. And they're just exploded because again, trying to keep kids entertained. And so we had the idea of, hey, let's do like build the most epic blanket fort. So ads showing the big blanket as an epic blanket fort, so now it's, okay, you may have one of this blanket anyway, but now here's how it can be put to use right now. Keep your kids entertained, keep them happy. It's not just putting them in front of the screen, but it's this kick ass blanket for it. And so it's things like that, thinking about how do we reposition this to fit the time?
Roland:
Absolutely. Yeah. And if you think about it, like the messaging there is you've got a bunch of kids, you show a bunch of kids running around, what are we going to do? I'm bored. What are we going to do? I'm bored, you know? And then it's like, what am I going to do? I need, I have an essential, I need something to help these guys be entertained.
Brett:
It's now an essential.
Roland:
Oh, a big blanket, that sounds great.
Brett:
Big blanket comes on.
Roland:
So I love that. Absolutely. Really, really smart.
Brett:
Yup, very cool. So really good stuff. I know there's so much here we can talk about, I guess one thing I made just touch on because this is something that I'm interested in. What about for those people that they're in a good spot, maybe they've been responsible and they're sitting on some cash and they're thinking, I may be looking for my next opportunity or looking for something to buy. I know this is an area that you are a master enemy and I would even like for you to talk about your LEGS Intensives a little bit, but what advice would you give to somebody that is sitting on cash and maybe is looking for an opportunity? What should they be thinking now, what should they be looking for? And I know this can be like a huge topic, so we'll just do kind of a teaser. Yeah.
Roland:
Yeah. I think I would probably sit on it for another 30 days because I don't believe this is going to stop in 30 days. And I believe a lot of people are going to really, who are living hand to mouth in their businesses, that there's going to be some tremendous opportunities. I know already like restaurants, I've got buddies calling me saying, "These restaurants are selling their best wine at like what they paid for it 30 years ago, are you interested?" I'm like, "Yes, I'm interested. Absolutely." And the same thing is going to happen with events. I think like the opportunity to buy events, there's so many people who just got their lunch handed to them. On the event side, there's going to be opportunities there and in terms of products, people that maybe got their stuff frozen at Amazon and can't do anything right now, but they're freaking out. They need some cash, the ability to buy equipment, machines, inventory, blogs, media of all types.
Brett:
Yeah, media coats are way down, we're seeing that on YouTube. And I hear it's the same on Facebook. The cost for media is that a major low right now and everybody is at home, like in front of their computer. So everybody's watching YouTube or on Facebook or something like that.
Roland:
Yeah, that's the two things I say is like when somebody says, what do you think of gambling? I'm like, I think that if I came to you and you were a rational person and I said, "Let's play a game. It's going to be with your money and the odds are incredibly in my favor, but I'm going to entertain you while you're doing it. Would you like to do it?" Most people would say no, but then they go to Las Vegas and it's like, hey, and it's the same thing right now. Okay. So if there was no pandemic, then there was no recession and things were where they were two months ago and I came to you and I said, "Hey, I've got some advertising to sell you on Facebook and Google. It's half priced. And by the way, all of your competition, they're dialing back their advertising right now."
Brett:
Right, they're dialing back or they've left.
Roland:
You'd be like, I am so in, triple my ad spend, but now just because there's this situation, if people are thinking emotionally, not logically, they're like, no, I need to cut back too, I need to hunker down. Don't do that, that's crazy. This is the time absolutely to do that. So what's cool is that while it's ... I mean, I guess you can buy Google and Facebook at a discount now too in the stock market, but to actually acquire your own media right now, to acquire other people's blogs and videos and listings and all of those kinds of things. Podcasts, right? People are freaking out, if you've got the cash, and I don't think it's yet, I think it's about 30 days from now when it'll be, we'll have all been confined probably for that amount of time. Everybody's going nuts anyway.
Roland:
People are like, even if it's like ... It's kind of like there's traffic on the freeway and you know that if you get on the freeway, it'll take you 45 minutes to get where you're going. But if you take the back roads, it'll take you 45 minutes too, but you'll be moving the whole time.
Brett:
Yes.
Roland:
You feel like, I'm going to take the back road. So there are people that will feel like that with their assets and there'll be like, I can't do anything with my podcast. I can't do anything with my product right now, maybe I should just sell it because that's a motion, right?
Brett:
Yeah.
Roland:
That's motion. And so I think that you'll see highly motivated sellers and lots of opportunities to buy things. And of course, as you know, I'd typically buy those for no cash at all so not that you don't pay anything, it's just don't come out of pocket any cash. So I think it's possible to actually buy those assets, improve your media, buy additional products or services and at the same time not deplete the cash that you've got. So that if some other once in a lifetime deal comes along, and I say the once in a lifetime deal comes along three or four times a year. I think this year the once in a lifetime deal is probably going to come along five or six times. And you just want to conserve your cash, even if you've got it, when you're doing a buy like that so that you have the cash for the next dealing-
Brett:
For the next dealing.
Roland:
... In case it really does require.
Brett:
Yeah, I heard that and I'm trying to remember, oh, it was a Robert Ringer, the guy that wrote-
Roland:
Winning Through Intimidation.
Brett:
Yeah, exactly. Or he changed the title later to, to be, or not to be intimidated, but the original was ... Yeah.
Roland:
I like that first one.
Brett:
But he talked about, he quoted somebody else, I don't remember who it was, but he talked about the effective non use of cash. Right?
Roland:
Yes.
Brett:
Where you keep the cash, but you use it so you have enough net worth and whatever to be able to go and acquire deals. And so I think that would fall into this category. One of the marketing thing I want to talk about just real quickly as we wrap up. But before that, eventually we'll be able to do events in person together and all that stuff again, but talk about your LEGS Intensive just really quickly and if you've got plans for any more of those or maybe that's all yet to be determined, but you want to just speak to that real quickly?
Roland:
Yeah. And the answer is that for all of our events, we don't ... I follow my own advice. I'm not sitting on my hands or hunkering down. So we've pivoted, all of our events have moved virtual until this is over. So I have LEGS as leverage, exit, grow and scale. And we're doing our first virtual one, April 21st, 22nd and 23rd. And rather than get people ... Like I think it's really hard to sit in front of a computer for eight hours. And so I think the people who are doing events like that are going to find that it's really tough to maintain engagement, after about an hour and a half, we see drop-off on anything that we do no matter how-
Brett:
Totally makes sense. It's not nearly the same as being in a big room full of people.
Roland:
No. So we're going to do it a little differently. We're going to do it as over three days instead of two, and it'll be six, 90 minute sessions. And I'm actually doing that with Jay Abraham this time.
Brett:
Fantastic. Looking forward to it.
Roland:
And so we're going to do like 9:00 to 10:30, and then we're going to give an assignment for people to work on and then take a break and then come back at 2:00 and then go from 2:00 to 3:30, three days in a row instead of, we would normally do it over two days and it'd be like a day and a half. So it'll be the same amount of material, but way more interactivity. And you won't get bored if you need to take care of the kids or go build a fort with their big blanket or whatever to keep them from driving us crazy, you can do it. And because zoom offers the ability to do breakouts, we'll be able to actually break the group out into groups of four or five people with the assignment to work on the assignment and then hit the button and suck them back in to the main room. So it'll be really fun.
Brett:
Super cool.
Roland:
I mean, it's exactly like we do it except you're not literally able to touch the other person. Right? And we typically frown on that, we tell people not to touch each other, generally in this. But so yeah.
Brett:
The timing of that'd be perfect because, so as we're recording this on March 26 you're talking about, hey, waiting another 30 days or so to maybe look for your opportunity. This Intensive is going to be just before that and going to give you those tools, those resources and that mindset to say, okay, how can I acquire something maybe without cash down initially. And so yeah, sounds phenomenal.
Roland:
Yeah, it's going to be really fun. I'm excited about, we've had, it's really funny, the last class that we did was about two months ago and it's fun. I think there have been 17 businesses purchased probably by that class. And so it's really fun to watch people take the thing and then go, you can now ... Number one, it's a big change of mindset to say, I can buy a five million, eight million, $10 million business without having to come out of pocket, can't buy it for nothing. You're just buying it for nothing out of pocket. Right?
Roland:
And all of the, I have 159 different places to find the, or I call it the deal stack, right? 159 different levels or layers of the deal stack to be able to do it with no money out of pocket. And so we just kind of go through that and we go through hypotheticals and say, here's the company, your mission now is, I want you to buy it. I want you to buy it for no money out of pocket, I want you to put cash actually in your pocket and I want you to do it within the next 60 days. It's really, really a fun project. I think we're going to run a challenge on that too, that we're launching on Thursday.
Brett:
Ooh, sweet.
Roland:
So it's-
Brett:
Super cool.
Roland:
Yeah.
Brett:
So where can people, and I can link to this in the show notes as well, but where can people find more about that LEGS Intensive?
Roland:
That would be LEGS, L-E-G-S, legsintensive.com. So that's pretty easy to remember. And then, just generally, I am pretty much everywhere. Roland Frasier, anything /RolandFrasier, you'll find me. And I answer all my own messages and try to help as many people as I can.
Brett:
Yeah. Your kind of wicked fast, like shockingly fast at some of those things too. I don't know how you keep up with so many things going on at one time.
Roland:
Oh, and then of course I have Business Lunch where we're ... I've taken a lot of those lives, even the War Room ones that we were on and putting them on Business Lunch to try to help people and we're publishing more frequently right now just so while people are kind of in that ... My goal and I know why you're doing these too, our goal I believe is to give without any expectation.
Brett:
Yes.
Roland:
Particularly in this time and to be there, to show people that it's going to be okay, this has an end date and you don't want to hunker down. You want to engage, you want to pivot, you want to do all of the things now because the people that take action now are the people that are going to be the survivors and the thrivers when it's past that survival line.
Brett:
Absolutely
Roland:
So it's awesome that you're doing these things too.
Brett:
Yeah. I'm really, really, glad to be doing it, grateful to be doing it and appreciate guys like you that are inspiring everybody. So I think this will maybe be a good place to wrap up. We kind of leave with some positivity.
Roland:
Okay.
Brett:
And going back to that, that Harvard Business review article, talking about a couple of companies that took this advice in previous recessions and instead of hunkering down, they've leaned in and they accelerated. Let's maybe share those stories if you don't mind. I think one was Kellogg's and one was Toyota.
Roland:
Yeah. And that was in a Forbes article I found.
Brett:
Oh was it? Okay.
Roland:
Yeah. That was basically going back over the last hundred years through all the different recessions. And so in the great depression, the leading cereal company back then was Post and there was a kind of an upstart company called Kellogg's and Kellogg's leaned in, Post cut their spending by half. Kellogg's doubled their spending and Kellogg's launched a new product, also called rice Krispies with these little characters called snap, crackle and pop. And basically Post was never able to recover. And so Kellogg's just kind of took the lead. And then in the 70s, it was, back when they were rationing gasoline at gas stations and having the even odd days with license plates and all that, that was the first time that they published those EPA mileage estimate statements where this is what the, how many miles per gallon each of these cars get.
Roland:
And two of the winners were Volkswagen and Toyota, and Volkswagen cut back because of the recession. They were like, well, it's an oil crisis and there's not enough gasoline so we should make less cars and we should advertise less. And Toyota was like, screw that man. We're one of the most mileage efficient, we're leaning in. And Toyota was able to displace Volkswagen. And then in the 90s, it was McDonald's and Pizza Hut and Taco Bell. And when the recession hit, McDonald's cut their spending, their sales fell by 28%. Pizza Hut, Taco Bell said, this is awesome. Our biggest competitor has left the field, we're doubling down. Pizza Hut grew sales 60% and Taco Bell 40%.
Roland:
And then even in the great recession in the 2008, 2009, Amazon leaned in and was able to grow sales 28% and so like throughout history, and there's probably 50 examples of that, that are readily accessible and it's fun right now too, to watch even in terms of hiring, with Walmart hiring 150,000 people-
Brett:
Amazon's trying to do the same thing.
Roland:
And 100,000 people in Amazon and CVS is 50,000 and who is it? Domino's I think is 30,000, and 7-Eleven is 10,000. It's like that alone, just that information, getting that out to people to say, there's so much opportunity in prices and the opportunity isn't let's buy all the toilet paper and sell it for 500% more. The opportunity is let's look at that consumer matrix and say where is the demand and how do we pivot into it? How do we pivot into that demand?
Brett:
Yeah, I just absolutely love it and it's that simple mind shift to where this can be a time where you are excited and looking at, hey, this can be good. One, I can help people through this process. And two, I can grow my own business and my own future ventures and things like that. But I think just underscoring, hey, what all those companies that you just referenced, what they all saw during the recession was cheap media, lower competition, I'm going for it. We had a good message. And also I think people want to see ads. They want to buy stuff, it's comforting in tough times.
Roland:
We like to buy things, we've been trained all our lives to buy things, right? That's not, you can only bottle that up for so long before you're like, ooh.
Brett:
Pent up demand. Yeah. People have been saving a lot of money lately by being forced to be at home and they're ready to spend. So, Roland, man, this was fantastic. I know you're super busy, you're in high demand, you do Facebook lives, and all kinds of crazy stuff. But I really appreciate you taking the time and joining me.
Roland:
Thank you for having me. I'm happy to help in any way I can. And again, I really love what you're doing in helping people out in this time, it's so awesome to see so.
Brett:
Good.
Roland:
Thanks for doing that.
Brett:
Yup, absolutely. So I will link to everything, but Roland Frasier, everywhere online. Just Google him, facebook.com/, you'll find him as well. So thanks again to Roland and thank you for tuning in. As always, I would love to hear your feedback. What topics do you need right now? What information do you need? What would you like to see more of or less of? And if you feel so inclined with love, that five star review on iTunes helps more people find the show. And with that, until next time, thank you for listening. My man, it's a wrap, Roland.
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