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How My $5 Book Earns More Than a #1 Bestseller (the math no one tells you) — Transcript

by Brian Ellwood · 2,308 words · 340 segments · language en · Watch on YouTube

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0:00I'm able to out earn a best-selling
0:02author
0:04and it's not even close. A best-selling
0:06author can take 100 book sales and turn
0:09it into maybe $600, where I can turn
0:12that into
0:1330 to 50,000 dollars simply by changing
0:18the way that I view books. And this is
0:21actually something that I learned from
0:25Sam Walton of Walmart from McDonald's,
0:28from Costco. We're actually going to
0:30talk about how some of the largest
0:32companies in the world are using the
0:34exact same approach that I use to turn
0:37books into revenue for their
0:39billion-dollar corporations. Now, I
0:42first learned about this in the book
0:44Made in America by Sam Walton. I found
0:48out that he would get toothpaste at the
0:52absolute rock-bottom cost and sell it
0:56and run ads to it, you know, it's only
0:5797 cents for a tube or whatever.
1:00That got people into the store and when
1:04they came to the store, they actually
1:06bought a ton more stuff that they didn't
1:08even plan on while they were there. And
1:09then I learned McDonald's actually does
1:11the same thing. They don't make money on
1:14the hamburgers that they sell, which is
1:16a crazy thing to learn. They actually
1:18make all their money on the fries and
1:21the drinks. They pay for marketing that
1:23gets people to pull up at the drive-thru
1:25to buy their crappy food and then they
1:28break even on the what they spend on the
1:30marketing with the sale of the burger
1:31and everything else is profit. This is
1:34called a loss leader. It is used in
1:37companies like Costco that sell
1:40rotisserie chicken, where it's like $5
1:44or a hot dog and a soda, their famous
1:46deal, where it's only $1.50.
1:49And there's all these tired out dads
1:51that are in there on their lunch break
1:54to get the $1.50 hot dog.
1:56Guess what? Every time they walk in the
1:58store to get that hot dog, they got to
2:00walk by the flat screen TVs. The same
2:02thing happens in a grocery store. You
2:04notice that like bread, milk, uh
2:07bananas, eggs, those things are always
2:10relatively cheap. Grocery stores don't
2:13really make money on those. They price
2:15those things very aggressively because
2:17those are needs that people have. And
2:19when they get in the door, they buy more
2:21stuff. In fact,
2:2340%
2:25of all purchases in grocery stores are
2:27made on impulse, which is crazy. That's
2:30almost half of everything anyone buys in
2:32a grocery store is impulsive. Digital
2:35online businesses do the same thing.
2:38Audible is giving people a free
2:40audiobook when they start a trial.
2:43Canva, you know, they let millions of
2:45people use their platform for free.
2:48And it costs them millions of dollars,
2:51I'm sure, to provide that service to
2:54people for free. That is their loss
2:55leader. And a certain percentage of them
2:58upgrade to the Canva Pro subscription
3:00like I have. It's awesome.
3:02And then that is how they make their
3:04profit. Cloud storage companies like
3:06Dropbox do this as well. They give away
3:09a certain amount of storage for free and
3:11then some people upgrade for the paid
3:13version. Now, in the coaching and expert
3:16world, Russell Brunson's kind of the guy
3:19known for bringing this philosophy into
3:23the digital online space. But he really
3:26learned that from guys like Dan Kennedy
3:29who came before him and even before the
3:31internet and they were doing offers via
3:35direct mail and other forms of offline
3:38advertising as loss leaders for the
3:41products and services they wanted to
3:42sell. And by the way, Hormozi's latest
3:45book Money Models is all about this.
3:48It's all about how to acquire customers
3:52at a cost that is absorbable
3:56and you know you can make three or four
3:57times that behind that initial sale, and
4:00that's how you can scale. Russell
4:02basically discovered that he could run
4:04ads on Facebook, for example, sell
4:06something cheap, build a customer list,
4:08sell them more expensive stuff later,
4:10and make a profit. And that is the whole
4:12reason that he started using sales
4:15funnels, which ultimately led him to
4:18build the company ClickFunnels, which
4:20we're going to talk about in a minute.
4:22Because
4:23an online sales funnel is a really tight
4:26and controlled, you know, little machine
4:29that you can use to make someone an
4:31offer and then upsell them other things
4:33and then get their information and then
4:35follow up with them in an automated way.
4:38You can track everything. I mean, it's
4:40no wonder that his software did so well
4:42because it was really the first of its
4:44kind to organize that funnel process for
4:48the online business. And the funnel
4:50really goes way beyond just that set of
4:52pages. It's the emails, the texts, the
4:54phone calls, the direct mail that goes
4:56out, the offer that's made, the
4:57relationship that's built, the expensive
5:00stuff that you sell. Nowadays, with
5:03community platforms like Serval, Kajabi,
5:05School, you can actually make your
5:07funnel even more effective by putting
5:09all of your low-ticket buyers into a
5:11community where you can DM them and they
5:14can access the material more easily and
5:16it's like a new social media following
5:19almost that you have. You can post stuff
5:20in the community. So, you can really
5:23tighten in on these things and make them
5:25to where it's like almost impossible
5:27that they don't work. And that whole
5:29ecosystem, from the little cheap sale
5:31all the way to the end, is basically one
5:34big slot machine where you put in a
5:35dollar and you get $4 back. So, that
5:38loss leader builds the list of buyers
5:41just like Costco's rotisserie chicken
5:44builds an audience. It builds a line of
5:47people in the store with the chicken
5:49under their arm and a few other things
5:51that they decided to get while they were
5:52there. That's literally a physical store
5:55representation of what's happening
5:56online. Like, they have the loss leader
5:59under their arm and they got a cart full
6:00of other in their other hand, and
6:03that's where the profit is made. We're
6:05not doing anything differently with this
6:07online like sales funnel world where we
6:10sell something low ticket and then we
6:12upsell something high ticket. The loss
6:14leader builds a list of buyers, too,
6:16which is very important. It's not a list
6:18of freebie seekers. And the thing about
6:21buyers is that they keep buying. Russell
6:24even says that a buyer is a buyer is a
6:26buyer. A list of buyers is the most
6:28valuable asset any business can own.
6:30Now, Russell had a ton of success with
6:33different types of funnels and different
6:35types of offers, but he's really known
6:37for his book funnels. And a book funnel
6:40is essentially just a low ticket funnel,
6:43a loss leader, that's designed to do
6:46what we're talking about. Sell them
6:47something cheap, the book,
6:49and then upsell them other stuff later.
6:51And then you do end up with a higher
6:53quality list because the people that you
6:56are acquiring as customers are the type
7:00that read books, which is a higher
7:02caliber of people that you would want on
7:05your customer list. But here's where it
7:06gets really crazy. So, Russell built
7:10three different book funnels over the
7:11years for his three books, and he was
7:13able to optimize these things so well
7:16that he could put, you know, $50 into
7:19Facebook ads to sell one book, but he
7:22would get $52 back. So, he was slightly
7:25profitable on his book funnels. And you
7:28might say, "Well, $2 per sale, like
7:31that's not very much."
7:33That is not the point at all.
7:35What he was basically doing was putting
7:38money in and getting more money back
7:41plus a customer.
7:42So, someone that bought something.
7:44And he had their name and their email
7:46and their phone number and their trust,
7:49right?
7:50And then he could contact them to sell
7:52them other stuff for free almost because
7:53it costs almost nothing to send emails
7:55and texts and phone calls versus to run
7:59new ads to get new people in. And so, he
8:01was actually getting paid to build a
8:04list of buyers, which is insane. And
8:07that is how he grew ClickFunnels to $300
8:10million per year in revenue. And there
8:12was this one point where Russell
8:14actually
8:15uh sat down with some investors that
8:18wanted to invest like $100 million into
8:20his company.
8:22And he told them about this, about
8:24getting paid to acquire customers.
8:26And they were like, "Are you serious?
8:28Because if what you're saying is true,
8:31this is going to change everything." And
8:33it did, and that's how he went on to
8:34grow his company so well. And he
8:37probably should have taken that deal as
8:39a side note because a few years later,
8:41HighLevel came along and took a massive
8:44bite out of his business because of the
8:47superior nature of their software.
8:50But, I digress because really what he
8:52did is worth taking note of because this
8:56is the model for scaling a business.
9:00Russell took his three book funnels as
9:03the primary driver. He built a list of
9:05millions of buyers. I mean, I went to
9:08the ClickFunnels headquarters to be
9:09coached by him personally. I got some,
9:11you know, a behind-the-scenes
9:12information. This is like how I got into
9:15this whole thing is I, you know, was a
9:17real estate coach trying to get clients.
9:19I wrote a book, and then I paid Russell
9:21to help me figure out how to, you know,
9:23use the book to get clients, but I
9:25learned that he had an email list of
9:27millions of buyers. I mean, could you
9:29imagine how valuable that would be if
9:31you could email like 1 and 1/2 million
9:34people for pennies and sell them
9:37something and they were all someone who
9:38had bought something from you. I mean,
9:40that is insane. So, he was able to sell
9:42them, of course, you know, consulting
9:44courses, live events, coaching programs.
9:46But, the bulk of his revenue came from
9:49software, hundreds of thousands of users
9:51of ClickFunnels paying $97 a month. Now,
9:54you can do this with anything, but I
9:56like books because they build more
9:59trust, they create more authority, they
10:01do a better job of making your entire
10:03argument cover to cover. They shift
10:05paradigms, they create a relationship
10:07with people. If you do a free plus
10:09shipping funnel, you can ship them a
10:10physical copy of your book, and it sits
10:12on their bookshelf forever. If you don't
10:14want to do that, you know, a digital
10:15version still works great. And then, you
10:18can also publish it on Amazon, and
10:20create a product, something that lives
10:23on forever, and helps people, and makes
10:25money, even if you decide to shut down
10:27or pivot your niche one day. You still
10:29created something that lasts, unlike a
10:31webinar or whatever, where those just
10:34sort of die, and no one like goes to
10:36watch old webinars. But, people read
10:38books that have been published decades
10:40ago. So, at the end of the day, the
10:42takeaway here is that businesses do not
10:44compete by selling products, they
10:46compete by acquiring customers. The
10:49products that they use to acquire the
10:51customers, they're priced very
10:53aggressively, because the real profit
10:55comes from everything that happens
10:56afterwards. That's why I sell my book
10:58for $4.99. I mean, you can check it out.
11:00It's literally the blueprint for how I
11:03built a multi-six-figure
11:05expert business on the back of my little
11:08books,
11:09as well as done this for multiple, you
11:12know, seven-and-eight-figure coaches and
11:13experts. You get the book, you get every
11:17prompt I've ever created in an AI agent
11:19skill pack, you get the exact book
11:21funnel templates, how to build the
11:23high-ticket offer, how to also put it on
11:25Amazon to where it actually ascends
11:28people out of Amazon and into your
11:30funnel, which is critical.
11:32The link for that is in the description
11:34and in the pinned comment. Really, I
11:36just want you to see that like
11:39it doesn't really matter. The $4.99 is
11:41not the point here, right? The point is
11:43getting someone to say, "Yeah, sure. Why
11:47not? It's only $5. I'll, you know, bite
11:50down on this."
11:51If you did, you'd end up on my email
11:54list and
11:55you know, I'm not the type to really
11:57over spam people, but I'm building a
12:00list of buyers. And I can sell them
12:03other things down the road, which is the
12:06main thing that's valuable in a
12:09business, especially a coaching and an
12:11expert business. So, if you're an author
12:12that wants to sell more books, that is a
12:14great goal, but I just want you to think
12:17about it as the loss leader. Instead of,
12:20you know,
12:21worrying about the royalties you get
12:23from that book,
12:25realize that you're building a list. You
12:27have an email subscriber. You have a
12:29qualified lead. You have a potential
12:30client. A potential future referral,
12:33okay? It does not matter if you have no
12:35interest in being Russell Brunson and
12:37having a multi eight-figure company,
12:40you can just want to, you know, make a
12:42million bucks a year. All the coaches in
12:44my mastermind have a loss leader of some
12:46kind. They run ads to something and then
12:49they build a list, they sell them
12:50something else. Even the ones that are
12:51doing 500 grand a year, million a year,
12:533 million a year. This is the model. So,
12:55if you really want to model what works,
12:57your coaching or expert business needs a
13:01Costco rotisserie chicken. So, what's
13:04that going to be for you?
13:06I hope this video's been helpful. If you
13:07enjoyed it, hit the like button. I
13:09appreciate you being here and I will see
13:11you in the next one.

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