Transcript of Interview with Rob Cuesta
Dan: Welcome to another episode of Shoulders of Titans. This is your host Dan Lok and today I am so excited to be interviewing a good friend of mine, an entrepreneur, a teacher, a mentor to so many service professionals, author, consultants and coach and a best-selling author. Rob, welcome to the show.
Rob: Thank you Dan. I am delighted to be on it.
Dan: Now Rob I now know you moved from UK to Toronto now so welcome to Canada.
Rob: Thank you.
Dan: So tell us a little bit about your background and how you got into what you do today.
Rob: How did I get in to what I do today? I came out of the world of big business consulting. I was a manager, senior manager for one of the big global consulting firms. At some point, it was around the year 2000 I got bitten by the coaching bug and I thought this is the way to go. Unlike a lot of people who set up in their own business, I didn’t do the kind of let’s do it again my spare time and see how this goes I went completely cold turkey, walk into my boss’ office, walked out of a hundred and something thousand dollar a year job and I didn’t realized at that moment but I just become a $10,000 a year business coach.
Dan: That’s quite a pay cut.
Rob: That’s a pretty hefty pay cut and for three years I kept telling myself—when you first set up your business, there is that ‘every new business struggles and it always takes a couple of years for things to settle in and for businesses to become profitable.’ It took about three years for the reality to set in which was that whatever it was I was doing, I wasn’t doing the right things. Around 2005, I reached absolute rock bottom and I got to the point where I was virtually bankrupt, $160,000 in debt.
A good friend of mine always says it takes a special kind of stupid to get $160,000 in debt and he is absolutely right because what I have been doing was the credit card bill would come in and I would go, ‘how am I going to pay the credit card bill? I know, I’ll borrow from the bank.’ Of course the bank statement comes in, how am I going to pay this loan? I’ll remortgage the house. But of course then when you remortgage the house, the mortgage payments drops and what do you do? You got to spend more on credit cards and I was spiraling and spiraling down into more and more debt. And then, 2005 was the year and it finally came home to roots. That was the year for the first time that I couldn’t do it on my own that you cannot build a substantial business without some kind of help.
I am being the guy who runs out and gets pens for myself and if the client was in the meeting with me—at that point there weren’t that many clients but I was the one that made tea. It really came home to me a few years later when things had picked up. I was working with the members of the board of AB and Amoro which is a big European commercial bank. We stopped for a tea break. Of course the first thing I do is to start walking towards the kitchen and they looked at me and they said, ‘what are you doing?’ and I said ‘I am just going to make the tea.’ They said, ‘no, no, we have people for that.’ If you look around the successful businesses, there is always a team behind them. That’s what I said 2005 was the year when I finally started working with mentors and I finally started working with partners and learned about joint ventures and strategic alliances. Turned it around the business that year from $10,000 a year, I set myself the goal that by the end of this year I am going to make $160,000 a year. Got to Christmas and I just missed it. I was $150,000 something a year I was making and I cut myself some slack and I thought I always met the spirit of my goal, I met the intent.
Then the next few years, it was even fantastic. I got bigger and bigger every year, more and more clients, spreading the word and then 2008 arrived and of course the economy collapsed. I found out because I was due to fly over to the US and my flight was booked for Monday on a Friday night a client rang up and said, ‘you are coming over to see on Monday.’ I said, ‘yeah’ and he said, ‘no you’re not.’ The challenge I had right then was it took a while for me to catch on to the new reality so I was still living like who someone who ran a $200,000 a year business.
Fast forward a couple of months and I am thinking, the world is not going to go back to what it was. The things that used to work aren’t working anymore. That was the year in which I really learnt the lesson of authority, of having to create more value for people being the competitors do and having to give them a compelling reason to hire you over and above anything they might want to hire your competitors.
That was the year that everything turned around again and in the middle of what supposed to be the worst recession in history in Canada. The caliber I know is a little bit wiser than another part of the world I supposed you could say but in the UK we were really hit by the by but that was one of my best years ever, 2010 and 2011. That was the year in which people started to come to me and say, ‘how did you do that? How did you come through the recession? How did you get to build something that is better now than it was in what was supposed to be the good times?’ That was the year in which I started to coach and mentor other professionals in building their professional practices.
Dan: Rob I am curious. So maybe share with me your business model when you were making $10,000 a year as a coach. It almost sound that you have gone through three phases. What was that business model? What were you doing to get clients? What was that like?
Rob: The $10,000 a year business model was I am a coach and whatever problem you’ve got, coaching can help you.
Dan: So you were trying to sell to everybody?
Rob: Absolutely. It was like that whatever your problem is, don’t worry I have got the solution.
Dan: You want to lose weight, yes I can help you. You want to make money, I can help you. You want to quit smoking, I can help you.
Rob: It really came home to when I was packing to move across to Canada. I was going through boxes and I found the first ever product that I created. It was a relaxation CD which would be great if I wasn’t for the fact that I have created it when I was supposed to be a business coach. So I spent weeks creating this CD and in the end I couldn’t even give the thing away.
Dan: Were you charging like per session or per hour?
Rob: Absolutely. This is my fee per hour, how many hours would you like to buy? It was a low rate per hour as well because I’ve fallen into the—it started with the advice that I have been given when I was first trained which was figure out how much you want to make, figure out how many hours you want to work you want to work and divide one by the other and that’s your fee, which is completely unrelated to what’s the value you creating for the client which what’s really behind a good charging strategy.
So I did that and then of course, the world didn’t catch up with how many hours of work I wanted and indeed needed. So yes, I created what I now called the gerniman model which is kind of the serving your apprenticeship by charging what other people tell you charge and doing what everybody else tells you should be doing because that’s what they learned. Most of the time it isn’t working for their mind but they are not going to tell you that.
Dan: That’s right. So I can see, when you were trading hours for dollars and non–
Dan: Yeah and then no position in the marketplace, no personal brand, kind of like a commodity kind of a coach.
Rob: When you are commodity, when you got no position, the only fee that you can get away with is the lowest fee. You actually have to be cheaper than any of your competitors just to get hired.
Dan: Because the marketplace has no way of differentiating of how you’re different from everybody else.
Dan: And then for second phase you went in from that a six-figure income with that model.
Rob: Yeah so the second phase was all about joint ventures and again, that was a process of learning and discovery. In the first phase it was okay this is what I want to do, I’ll find a venture partner who can help me with it.
Dan: Were you marketing a product or service back then?
Rob: Here’s the interesting lesson that I learned because that first joint venture, I got a hold of somebody else’s big list and we market the term and I organized a teleclass. We had 126 people in the teleclass and the bit that I have left out was the backend.
Dan: So it was a one-time thing?
Rob: It was a one-time thing. So I ended up with—I think in the end I got about $22. I say in the book, I got zero from it, $22 and I probably spend more than that on the phone call that actually made the teleclass. The second one, I got a little bit smarter. We had a backend and that actually I think I made about from the original joint venture, I made a couple of thousand. Actually when I went back to it a couple of years later having learnt my lesson that turned into a partnership with that over years made me $60,000 or $70,000.
What happened in between was the third joint venture that I set up was a lot smarter because it was with a company that had services and products that were complimentary to mind that had plans and an industry where I had real credibility. It was an industry in which I had worked and I could point to the results that I had created for plans.
Dan: I see so they had access to your ideal clients.
Rob: Exactly. They had access to my ideal clients and I had something to give those clients that they couldn’t give for themselves and that was the joint venture that started me off on the journey of becoming a six-figure business.
Dan: Talking about joint ventures, before we talk about phase three, any lessons you want to share with us when it comes to joint ventures, finding the partners or working with JVs.
Rob: Yeah as business owners, if we’re smart we put a lot of work into thinking about who’s my ideal client and where are they, what’s their income, what industry are they in—all the demographics and then a lot of thought about the psychographics—what’s important to these ideal clients. The bit we forget is that when it comes to joint ventures partners, we have an ideal joint venture partner as well and we can do exactly the same exercise that we do in finding out our ideal client for finding the ideal joint venture partners or what’s important to them, what their ideal values, what makes them tick and what’s the result that they want out of that joint ventures partnership as well. Because if they are not getting what they want and I am getting what I want then somebody is going to get annoyed and it’s not going to be me because I am going to be happy. Put as much thought into picking the joint venture partners as you do into picking your ideal client.
Dan: Awesome. I kind of experienced the same thing when I found a JV partner, I always find out what exactly are their goals, what are they looking for, what problems they are trying to solve for their marketplace. In your case, you have a product that’s complementary to whatever they are offering and you serve the same sector in the marketplace so that’s fantastic. Also, myself I try to make it as easy as possible. Do the most of the work, create more promo, create the page, make it almost a no brainer so they do as little as possible and you know, do you always structure half-half, 50-50?
Rob: It depends. Normally because a lot of the stuff that we do is done for you. There is a lot of custom bandwidth and we structure it around at the proportion of the profits rather than the proportion of the sales because otherwise there is a good chance we end up making a loss on the deal.
Dan: That makes sense. So that’s business model phase two. That’s kind of like JV not doing it on your own and it’s almost leveraging a little bit more, leveraging other people’s list, leveraging other people’s credibility and then phase three, what’s that in your business model like?
Rob: So for phase three, the business model was all of the authority building stuff that I teach my clients which was that I got to that point where I thought that if I don’t do something now, I’m going to be right back when I was, it would have been seven years before. So the first thing that I did was I started going out, getting speaking engagements.
I wrote the first book that I wrote which was More Clients, More Money, More Fun. It was about to say a 30-page book. I think it might actually be—48 pages, I get a copy of it in front of me here. I keep it. So it was just a way of I call of putting a stake in the ground, claiming your territory in the field. I was using the book then to get the speaking engagements because it’s a lot easier to get a speaking engagement if you can say I’m the author of this book. Particularly you can say around I’m the best-selling author of this book.
I’m getting in front of plat audiences of potential clients, make me see the fact that they have the problem that I can solve and they were looking for a solution but also that they knew they had the problem and that they were able to pay and willing to pay which is essentially they often forget a lot of experts get often upon. I need to be in front of an audience, I need to go and speak and they get in front of any audience and it’s not the right audience or it’s a bunch of people who can’t afford to hire you for whatever reason.
Being an Authority
Dan: It goes back to understanding who your ideal clients are in your own business model. What if someone said to you, I love what I do and I am good at what I do, why do I have to be an authority in my marketplace?
Rob: I always use a phrase—in all my books I use a phrase called the ‘natural expert’ and it’s the person that everybody wants to hire, whatever it takes and however much it costs. That’s the impact of authority. If you’re not positioned as an authority in your field then you are as we said before a commodity and you are competing on price or convenience. You’re effectively the corner drugstore of your industry.
It’s really hard to make a living that way because you are inevitably charging by the hour because that’s what people are expecting to pay and you’re charging at either at the market rate or below the market rates. As soon as you’ve become an authority and as soon as people start referring you on as an authority, then it makes a complete mindset change in the person who’s hiring you. Now, instead of you having to go to them and say please hire me, they are coming to you and saying please work with me, I read your book, I saw you on YouTube, I saw you on TV—whatever it is and I know I need to be working with you, what it’s going to take?
That’s the point at which you can start to set your own prices, set your own conditions. There is a fantastic film that not many people have seen. It’s called the ‘Muse’ and it calls itself a writer’s muse in Hollywood and basically she helps writers and directors to get pass their blocks. It’s a comedy because there is a director who wants to work with her and she is saying, ‘well if you are going to work with me then I need you to go to Tiffany’s and buy me this piece of jewelry.’ The guy runs off to Tiffany’s and brings her back.
I need you too— I can’t remember the conditions but the demands are getting more and more ridiculous and the more and more ridiculous the demands get, the more the guy wants to work with her. Because he is being told right at the start of the film, this is the person who is going to get you out of your lot and this is the person who is going to transform your career. And of course, at the end of the film she does exactly do that. If I has just been, “you got a problem with your writing I can help you,” then it would have been blah. You and 500,000 of writing coaches in Hollywood got of that.
Dan: There is a great saying, if you’re not the lead duck, the view is always the same. So Rob what you’re saying is and I totally agree in any given industry, field or niche, there is usually only the one person that who is known as or that person the man or that woman is the go-to expert. It’s the number one person in that niche. Yeah you might have like a second place or third place but there is always that one person that everybody knows.
Rob: Yeah who came second in whichever resource who’s–
Dan: Nobody remembers.
Rob: Yeah, who was the second person who climbed Mt. Everest, who cares?
Dan: So now we understand the importance of being an authority. How does one become an authority? What’s the best way to do this? Do you have to be a speaker? Do you have to write a book? What would be the strategies?
Rob: The simplest and the most compelling and it’s there in the English language and it’s to be the person who literally write the book on what you do. One of the first things that I get my clients to do is to write a book about their field of expertise. Most of them immediately turn around and say, ‘well I couldn’t possibly write a book.’
Dan: I think in your book, you talk about the 10,000 club.
Rob: Yeah. So according to the New York Times something like 81% of the population wants to write a book. But in reality, less than 1 in 10,000 people actually does. If you look at the number of books being published every year and the population, it’s less than 1 in 10,000 so the moment that you have written a book you have become one of those fewer than 1 in 10,000. So you’re immediately about 9,999 of your competitors.
Dan: Rob, you have done five books? Am I correct? Five or six? Five?
Rob: Five, plus the ones that we have done for our clients as well, but yeah.
Dan: So you have written five books on your own and they are phenomenal books and our listeners can get it on Amazon. I think each book is almost—because I read a lot of books, I probably read two or three books per week. Your books, each book I think it’s almost like a mini-seminar on its own. I can tell it’s almost like a two-day training jam packed into one book. So I’m a fan of your work as you know. I mean I bought in your program and I study a lot of people’s stuff so I don’t say that lightly.
I absolutely agree because myself, I wrote my first book in my early 20s and I saw the impact of that and from there I kind of become a book addict. So now all of these years I have done about 12 books or something like that. People always ask me, ‘why do you want to write all these books?’ Because they make a lot of money that’s why. It’s very simple. I mean the book itself doesn’t make me money. It’s not like royalties and on. I always say, what is the best way to lose money? Publish a book. You don’t make money from the book, from the royalties but use it as a marketing tool. It’s funny you mentioned that because I haven’t had a business but in five years.
Rob: Exactly, somebody else, what I would do, I hand them a couple of books.
Dan: That’s it. It’s like an ultimate business copy on the planet.
Rob: And then if somebody says how do I find your land, I would give them one or two ounces, I would say Google me or I would say look for me on Amazon.
Fighting the Mental Barriers
Dan: Perfect. I say exactly the same thing. That’s awesome. If you look at the word authority, you’re looking at the first six letters what do you see? An author so we talked of becoming an author. Now Rob what if someone listening to this podcast, thinking about of ‘who am I’ and ‘that’s so difficult.’ People have a lot of mental barriers when it comes to writing a book. What would you say to them?
Rob: One of the things that I do with my clients whenever anybody says, ‘I don’t know that,’ I get them to draw a little line across a piece of paper and the left hand end of the line represents zero, knowing absolutely nothing about your field and the right hand then in theory is 100% which is knowing everything about your field. The reality is there is no right hand end because if anybody have ever got there, they’ll find the line have moved. Every field of knowledge has constantly expanded, except maybe how to make that radio valves in 1930s. There is probably not much research going on there. But otherwise, every field is expanding. But I said in case of if that’s the field as it is today, put yourself somewhere around that line, and I get them to draw a little line and a little mark on the line of where they think they are, whether it’s 10% of the way, 20% of the way or 30% or 80% or 90%.
I give them to mark a line in the continuum that represents their level of knowledge, whether it’s 10%, 20%, 30% or 80% or 90% and then everybody to the left of that mark represents all the people who know less than they do about their field of expertise. So that is all the people that they could help. So even if they don’t know very much, there is a lot of people that they can help. But the only thing to bear in mind is when we are learning stuff, first of all because we are completely in that field all the time and thinking about it, everything about it seems obvious to us but to the rest of the world it’s almost like rocket science most of the time. So they don’t know what we know and we forget that and we think everybody knows that. No, we know that because we are expert at it but to the person outside of the industry, this is new stuff.
Most of the time, we don’t actually realize how much we know anyway. I teach a little model where I talk about what is true wisdom. I’m just trying to think where it is in the book because that’s actually in authority. I can’t find it now but if you think about what happens is we go away and we learn something. Most of that stuff we don’t actually remember. It’s what we do remember that becomes our knowledge. Anybody who has read the same stuff as us probably has remembered some of that stuff but they don’t remember the same as us so we already have got some different knowledge from other people. But then, we actually apply it and it’s that application that gives us experience.
Now, the number of people who have got the same experience as us is starting to go down because they really would have been in different situations, they would have different results. If we don’t take that experience we have got and reflect on it and we draw our own conclusions of it that’s what gives us our unique point of view and it gives us our unique point of wisdom, that’s the stuff that we are sharing with our clients. They are not paying us for the information and the knowledge because anybody who has done the same courses, programs and written the same books as us has that but our unique knowledge and wisdom and reflection, that’s what clients really want from us. It’s that what you put into your book. It’s much easier to just looking from that point of view and you stop cataloguing everything you know.
Dan: I absolutely agree and I think it’s also people may have the limiting belief the book has to be absolute perfect. We are not trying to write the Holy Bible here. It’s a niche book and really what you are trying to do is a positioning tool.
Rob: Exactly. As I said my book is 48 pages long. I think one was a whole 58 pages long.
Dan: Just 10 pages more. Exactly. But it worked because you got your speaking gig, you got your clients and what we try to do is we are trying to stand out. We try to be different from everybody else. Let’s say we are going to write a book, an authority book, is there a way a specific way, or you pay attention to or we just going to write whatever we want or do you have a system? When you make an authority book, you should have these type of structure or content?
Rob: Yeah there is a couple of different structures that we can take and again, I put a lot into authority that the one that I often steer people towards is thinking about the questions that people often ask you and the questions that you wish that people ask you. In answering those the questions that people often ask you that’s really answering objections. Most of the time when people ask those kind of questions it’s because they have got some of objections. Answering the questions that you wished they would ask you, then what you are doing really is teaching them how to hire as opposed to anybody else because the questions you wish they would ask are often the ones that would set you apart from other people.
That’s one of the structures that we use with our clients. One of the ways that we do it is we interview them and get the stuff out of our head and then we turn it into a book form because a lot of people, one of the big blocks they have got is not only that I don’t know enough but I can’t write. My philosophy is that nobody should ever be prevented from writing a book just because they don’t think they are a very good writer. Answering those questions, that’s one of the easiest ways of doing it.
Dan: Fantastic. Well, we are going to take a quick break and when we come back we’ll continue our conversation with Rob.
Uses of an Authority Book
Dan: Welcome back. We are talking about how to position yourself as an authority in your niche. We are talking about how to write an authority book. We are talking about how to charge more money, how to attract more clients. Now Rob, with the book has announced someone they listened to our advice, they now got a book, they got it ready to go. What is the next step? What are the ways we could use the book?
Rob: There are a lot of ways that we can use it. One of the key things that I get people to do is to write down a list of the people who would love to get a meeting. If you’re in a B to B field and your clients have businesses or if you’re in a field that you can name the clients or wish the individuals you wish were your clients then that’s great. You just write down a list of your key prospects, and you send them a copy of the book and you ask them for their feedback and you say you’re going to fit follow up with them.
One of my clients did that and they ended up with six leads that between them were worth a million dollars and they also got a call back from a company who they have bene trying to get in front of for three years that had been completely ignoring it. When the book arrives, it arrives in an Amazon box because what I get my clients to do is order from Amazon and have it send them to the person rather than sending them themselves.
Getting Pass Gate-keepers
Dan: That’s a great strategy because I got that from your book. Actually talk a little bit about that because you talk about sending a prime account. Talk about that because that’s profound.
Rob: It’s difficult for most of us to get pass gatekeepers. Whether it’s selling to businesses and it’s difficult to get pass the person or the assistant, the secretary or whoever or if it’s selling to consumers there is somebody at home who goes through the post and decides what should and shouldn’t be read. Letters, brochures, leaflets—they all get thrown away. Unless, the person is thinking about that thing in that very moment.
But imagine you’re a secretary and an Amazon box arrives on your desk, with your boss’ name on it. It takes a really gutsy secretary to open that up and throw the contents in the trash. So one of the easiest ways to get pass the gatekeepers is just to have something delivered in an amazon box. There is also one thing about when a parcel arrives in your desk, it’s like is it my birthday, is it Christmas?
Dan: Is it a gift? It’s an Amazon. We are leveraging also Amazon’s brand. I think that goes on top of the file, people got through that first.
Rob: Exactly. Even after they’ve read it, it’s really difficult to throw that away. People don’t throw away books.
Dan: Unfortunately people throw away business cards.
Rob: I remember somebody being horrified because I had handed my business cards and I took a business card out of my wallet and won’t mind because I have given it to somebody. And of course, what I have done is I have given away their business card. So I then had to Google them and called them and say, I’m really sorry, I gave away their business card and I explained what happened. ‘How could you do that?’ it was a piece of paper and I needed a piece of paper. Yeah we throw away most things but we don’t throw away books.
Dan: It’s very true. So that’s strategy number one. We send through Amazon. We send our finished book for our potential prospects, our ideal prospects.
Rob: Even if we can’t name our ideal prospects, if we can identify named individuals who would be a great JV partners because they have those prospects as their clients then you can do the same strategy with them.
Dan: Perfect. It’s actually the exact same strategy that I have used to build them on my companies, I have recommended it to my mentees as well. Let me give you a case study because I planned exactly what you’re suggesting here. So our company with my partner Ken Lap we offer internet marketing to real estate agents, real estate professionals. While we were having this interview, a couple of weeks ago we published our book called Sold. You can imagine what does every real estate agent wants? Sold. It’s pretty good title, right. So we have that book, exactly we were mailing it to our ideal prospects.
We also mail to any JV partners that has access to real estate agents, who are trainers and who are coaches in those categories. So it’s exactly what we are suggesting here. Because of that we have gone through and we are able to get through the gatekeeper and talk to quite a few of these heavy hitters who have been in the business for 10, 15, 20 years and do a deal together. This absolutely works. There is no doubt. But Rob besides JV partners how else can we use the book?
Rob: So sending it to potential speaking engagements, event organizers and using it to get yourself speaking gigs. I am trying to think about ways that I used the book. Using it in sales meetings. When you go into a sales meeting, the chances are the competitor who went in before you probably left a business card. How do you make sure that that business card ends up in the trash? You don’t hand over a business card, you hand over a copy of your book. It’s a much more compelling thing that the person who came in before you left this really glossy brochure, what have you got. Well, I have got a 200-page book.
Dan: In the decision time, well this guy got a business card, this person got a brochure but this guy has got a book.
Rob: A few years ago I was programmed into a sales meeting. It was the second meeting. So the first meeting I had was with the MD and the director back in the parent company who was responsible for managing the substituent and so I had had that first meeting. And I went into the second meeting and the director from the parent company had got a copy of my book for each person in the room and made them read it beforehand.
Dan: Well that’s awesome. All the pre-selling is already done.
Rob: Exactly. I was there to explain what we were doing to do. I wants there to have to sell for them.
Dan: Now, Rob what if someone is thinking, it costs money, it’s like a few dollars per book and it’s so expensive to give it away like what do you have to say to that?
Rob: I know, well people do think like that. I remember when people sued to think about that just to print business cards. I can’t give away my business card because it had cost me 50 cents to get it printed. Well, what’s a client worth to you? It’s the same with the books. For the sake of three, five, 10, I was talking with a client the other day and they want to produce a full color 160-page photographic book that you can’t get printed from the $30, and $40 but the clients that they are going to get with it are worth an awful a lot of 30 or 40 dollar bills. If something like that arrives at their desk, it’s hard to say no to the person that created that book.
But even if you’re creating a paperback that cost 4$ to print if you’re getting a client that worth $400, $4,000, $40,000—whatever the value of the client is to you, you can afford to send those out. The key is to understand your numbers and to understand how many prospects you need in order to create a paying client and to understand the client is worth to you. It’s the same with any marketing that we do.
Sending out postcards, sending out letters has a cost, running a cold calling campaign has a cost, having staffs go out in the streets and go ghost hunting has a cost but as long as you understand this is the cost of getting the book printed, this is the cost of getting it sent out and this is what it’s going to give me, I know that for every hundred books I send out I am going to get 40 inquiries, for every 40 inquiries, 20 of them are going to go to a sales meeting and of those 20 maybe five are going to become clients then I know I have to send out 100 books to get five clients.
How much are five clients worth?
Dan: So basically with marketing, we think of returns on investment. You spend a dollar you get two, three, five, 10 dollars back then who cares? You are exactly right, there is a cost to ineffective marketing. The money that we wasted to printing those brochures that people throw away is the same thing. I can’t tell you how many times I probably get people, they read my book, you probably get those calls too Rob that like “oh yeah Rob I read your book three years ago or two years ago, it’s on my shelf. I put it on the shelf and ow I am giving you a call, I want to do some business.” You just don’t get that kind of impact with a brochure, with a flyer.
Rob: Nobody ever rings up that hey I read your brochure.
Dan: I am so excited I read your brochure the other day. No that doesn’t happen. Awesome.
Rob: That reminds me of another story of one of my clients. So they sent out books to their prospects and they have got an email back from the assistant to one of the people they have sent it to. The email said, I am really sorry, you have sent it to the wrong person but I forwarded it to the right department. They have forwarded it to the right director that said I forwarded to so and so who is the director responsible for this kind of thing. When was the last time someone who let you know that you sent their brochure to the wrong person but they put it right and they gave you the name of the person that you should be speaking to. It doesn’t happen.
Myths to Growing a Coaching Business
Dan: That’s awesome. So Rob so now we have got a book. What are some of the myths when it comes to growing a professional coaching, consulting, advisory or service business? What are some of the myths from your experience that you have seen?
Rob: The first big one is the idea that you can’t get started without a list. That you got a huge mailing list of prospects. The book will help you to build that because there are ways that we can find out who bought it on Amazon. I actually get them to tell us and things like that. But when I started the business in helping coaches and consultants to build their practices, I started with a list of 253 names.
I turned that into the first $100,000 of revenue within the space of a few months. So you don’t need a list of 10,000, 20,000 names. You need a list of the right names but if you have got high value names you only need a small number of names to make a good revenue. So perhaps that the first myth and it’s one that holds people back for a long time of ‘oh I can’t be like that person because I only got a small list. I can’t offer a high-end products. I can’t offer high value services because I haven’t got a list.’ The other one is that people don’t pay for advice, which is actually true because nobody ever bought advice, what they buy is the result they’ll get from implementing that advice.
The other one is what I call the guru model. Which is that you need to have this long deep funnel in which you give somebody something for free and you offer them a five-dollar book or product and then you offer them a $27 product and then from that maybe you can leverage them up to $97. Maybe you get them to a weekend workshop for $300. When you do the numbers on that, that’s why you need a huge list because what getting one client at the end of it, meaning you need to start with about 10,000, 20,000, 30,000 people at the top.
If you go to what I call an expert funnel which is a lot shallower and you get a lot more gusty but the key is the relationship. The guru model is lazy modelling. It is lazy marketing because t guru model is I can’t be bothered to give you value and build a relationship. So I am just going to bribe to come to the next level each time. It takes a long time to get through that. My aim is always get people into some kind of live experience whether it’s online or face to face because that’s when you can actually create a relationship with them. That’s where you can create results. So you can go from someone who buys your book to someone who is in a weekend workshop to some who is then in your high end coaching or consulting program.
Dan: So you simplify the steps. So basically you make it, you are trying to shorten that lead time, the relationship building by giving them massive value in a short period of time and position yourself correctly, that hey “you know what Rob you’re the guy when it comes to X. Perfect let me work with you. What’s the high-end program that you have?”
Dan: Versus having a bunch of smaller five-dollar thing, $27 thing, $57 thing all that stuff.
Dan: Interesting. Of course because they see you face to face so that builds trust also faster.
Rob: I came across that realization when I was teaching a high-end program and they were people there who had invested anything from $12,000 to $20,000, some of them have invested more. I was teaching them to implement the following. One of them was in front of the room a lady called Susan, she held her hand up and she said, “look you didn’t get us to do any of these.” I thought it’s absolutely true. They had gone from an email to a weekend workshop to being one a $20,000, $30,000, $40,000 program. Why am I teaching you this? Why don’t I teach you what I actually did?
Dan: We don’t want that model, give me your model. That’s fantastic. I can also see nowadays, it’s like you said people buy results and people nowadays they want results faster and they want bigger transformations and they want it faster and they are willing to pay a premium for that versus here are 50, 60 CDs, you got to listen to.
Rob: A lot of the time we are worried about doing it because we don’t have faith in that transformation. That’s why we mess around with the $20, $30, $50, $100—whatever it is, it’s because we haven’t got faith that what we are doing can create a transformation that is worth a thousand, 5,000 whatever.
Dan: Well Rob let’s talk about premium pricing. We are talking about premium pricing. We are talking charging for like how much?
Rob: How much? It depends on the field that you’re in but it’s going to be a thousand dollars, five, 10, 50, 100, 1,000 whatever it is. I have known coaches who have done $100,000 programs and it’s down to the value to the client on what you’re doing.
Dan: So we are talking on how to get to your financial goal with fewer costumers. Because you think about it we are selling a $10 eBook to make let’s say $100,000 you got to sell a lot of copies. Or you can get 10 clients at $10,000 a pop then 10 clients you are there.
Rob: The thing that most people don’t appreciate is it is just as—depending on how you see it, it’s either just as easy to get someone to pay $10,000 as it is to get them to pay a hundred. Or you can look at it it’s just as hard to somebody to sell $100 product as it is to sell them a $10,000 program.
Dan: I agree and by charging more money, it’s not about being greedy or anything like that. It’s by charging more then we can have more resources to deliver that result. Deliver that experience. If someone pays a $100 to come to your workshop, well you can lead things so much. I don’t know if you can even provide coffee. But if someone pay $5,000 at a workshop–
Rob: Exactly and you can provide that experience and you can’t even afford to give them any support afterwards. If someone is paying $500, $1,000, $2,000 to be in that workshop, you can make that they have a good experience and that they get the results.
Dan: Yes and also we feel good because then we are also getting properly compensated for what we do. So Rob what is holding people back from like all the entrepreneurs you work with, what’s holding them back from mentality from charging top dollars.
Rob: One of the bog blocks is the models that are taught in business schools and what I have learnt is when I did an MBA and I was taught the price and demand curve. The idea that the more you charge, the fewer costumers there are in your market and for every product you are saying you got to work out at what rate that demand is tell you those prices rise. What people forget is virtually that in any market, there is a point at which you reach a price and I call it the Stella point because there is a bear called Stella, and for years in the UK it was marketed as being reassuringly expensive.
That’s what happens you get to a point that which people realize if this person is charging this much they must be phenomenal at what they do and I want to work with them. Why would I want to work with that person at the other end who is charging a thousand when this person here is charging $10,000, $20,000 but look at the result they are getting for their clients? That’s it you got to back it up with real results. You can’t just sit down and go what a thing that I can charge $20,000 now. You got to be backing it up with and when I charge 20,000 this is one we are going to do with the client. So that’s the first thing is the fear of losing clients. Because they look at and they think, gosh I am charging a thousand dollars and I have only got 20 clients.
If I charge 10,000 and I only got one client then I am going to lose money or maybe nobody will buy. The reality is you go and you look at it, actually at the top end that the clients are going to come back and I am going to be there a lot less work overall but I am going to be able to give so much service to the smaller number of clients I have got. So I can give those clients a real white glove, concierge service. I can cater to them, I can hand hold them, I can make sure that they are getting the results. Rather than running around chasing after 100 people who are paying me a 200 dollars.
Types of Clientele
Dan: Those are the very different type of clientele anyways.
Rob: There are very different type of clientele. The people at the bottom end of the market are going to be the ones who are argue about everything. They don’t do what you ask them to because they are not as invested. They are the first ones who says, ‘we are supposed to have a 60-minute call and I only had 57 minutes. Can I have an hour and 3 minutes next time?’ At the top end they are saying, ‘we have been in the call for 10 minutes but I think I have got everything that I need now, thank you.’
Dan: One of the things people have to realize is this. I always believe that those who are afraid to buy are also those who are afraid to sell. Meaning if you want to sell a $15,000, $20,000, $25,000 program, it’s very difficult for you to do that is you haven’t done it because you don’t know what it’s like. You don’t know what it’s like to write that check or to hold the credit to invest in yourself that $10,000, $15,000, $25,000.
Rob: I know one of the products that mine that you have got is the VIP The Instant Income Secret, which is all about running $5,000, $10,000, $20,000 days. The reason that I was able to do that is because I now invested $10,000 in doing a holiday myself. That was the point where I thought okay it’s actually okay to charge this time for a day of time because these are the results. So then I went out and I thought okay what are the results that I had to create for my clients to justify the free from pay day and that was what set me off on to that journey which then come way that I am saying to my clients, ‘you need to be doing this as well.’
Business Model for Premium Price
Dan: That makes a lot of sense. So what are some of the different business models when it comes to like premium pricing business models?
Rob: The first one, the one that’s easiest for most people to do is to create a high-end product. A high-end product is often exactly the same product that they were selling before but adding things to it that create extra value. So for example, the VIP day product, it wasn’t just training modules, it had worksheets. It had planning tools. It had sample agreements. So they were things that actually help the person to take what was being taught and implementing them.
I am just in the process of releasing a referral marketing program and it’s the same thing. Yes there are seven modules of instructions but along with it there is worksheets for tracking how well each of the strategies is working. There are sample scripts. There are guides for creating what I call a wow factor with these locks of—I can’t do it for them but I can do it with them effectively. So creating a high-end products is one of the most basic premium business models. Doing things for the client is the next. So nowadays people are becoming increasingly time poor and money rich. The problem used to be that people don’t have the money now they have the money.
They just haven’t got the time to implement what we are telling them to do. So if you can find elements in what you do that you can actually take away from the client and say you know what I will do this for you, then that become a premium business model. And because you are the one now inject creating the results and they are basically hands off. You can charge a lot more than if you are just selling them an eBook that told them what to do.
Dan: So it’s a kind of about how we can deliver the results, make it easier, make it faster.
Rob: Make it easy, effortless, faster and more secure as well. Because when somebody doing it for themselves, there is always the risk that they will do it wrong, that if they have got an expert doing for them they know that everything is going to be done right.
Dan: So it’s done for you or enhancing, giving them tools, giving them like you said scripts—things that would help them and enhance their buying experience. Those types of business models.
Rob: The other two that I—I already mentioned power days, the VIP days, that’s the big one that I always get clients to do which is spending a day with someone and make sure that they have got a massive result at the end of it. I came back just before this call from a power day with a client where we basically scripted his sales presentation from sitting down and thinking what is it we are really offering and turning a set of basic real estate services into a package that is affected and he doesn’t realize well he actually what we have presented is a done for you package effectively for property investors. And then scripting the whole presentation around that and actually creating the PowerPoint together so that in the end of it, he knows exactly what to say, he has got the PowerPoint, he could go out tomorrow and deliver it.
Dan: So that he walks away with something that he can implement immediately and get results and make more profit versus just sitting through a couple of days of workshop and he has to internalize it, goes back to his business and maybe he does something. Maybe he doesn’t who knows. Maybe does only a percentage of it, even if he does, even if he makes a mistake. He doesn’t even know he makes a mistake.
Rob: Exactly. And then the final one is group coaching programs. Mastermind programs, mentoring programs. Actually getting people into a group, the mistake a lot of people make is the group coaching is worth less than working one on one with people, actually there is a lot of value in the group work as well. And so we can actually charge more for helping people to by introducing them to their peers.
One of the big principles I teach my cousins you become who you hang out with. When I was struggling as a coach in the early days, I used to belong to a group of coaches who would meet once a month and all that everybody would talk about is how difficult things were and how nobody was making any money. Then in 2008, one of the things that I did and another part of my business model is I joined a mastermind group in which I was sitting around with clients who were making sex, seven figures and it shift your mindset. So a group of coaching program which you are introducing people to each other and they are helping each other to create more and more results and they are holding each other accountable, one will take a lot of pressure off you. Two, it is immensely valuable to them.
Dan: Also develop relationship with each other. No one of us is better than all of us. So they might get an idea from some other members but who cares. They get the idea because they belong to your group.
Rob: So those are the four basic premium business models that I teach my clients that high-end products, done for you coaching, group coaching and power days.
Dan: fantastic. Rob let’s have some fun here before we go. Let’s jump into what I call a speed round. OS I am going to ask you 10 questions and I am just looking for very quick answers. So question number one, Windows or Mac?
Rob: I have just bought a Surface Pro 3 so Windows.
Dan: Okay. iPhone or Android?
Rob: Windows Phone.
Dan: Awesome. What is your favorite success quote?
Rob: Hey I got to confess. Microsoft is a big client of mine so.
Dan: Alright. So in case they are listening to this. We love you Microsoft, right?
Dan: Favorite success quote.
Rob: Favorite success quote. Actually it’s the there is no such thing as bad publicity. If people are talking about you, let them.
Dan: Are you a dog or cat person?
Rob: Dog person.
Dan: Dream car?
Rob: It would be so there is two actually, there is a Aston Martin Volante which is the drop top or a Maserati.
Dan: Number one thing a new entrepreneur should be doing.
Rob: Number one thing a new entrepreneur, writing a book.
Dan: Yes, I knew you are going to say that. I agree. Favorite business book.
Rob: My favorite business book, it’s one called The Undercover Economist.
Rob: Actually I’ll qualify it, there are two and they are both by economists. Undercover Economist and Predictably Irrational because they are both investigation of how the world really works, not how people think it works.
Dan: Love it.
Rob: If you can understand that you are long way ahead of your competitors in marketing.
Dan: What’s the tool that you would use everyday that you would hate to have live without?
Rob: Actually fresh books.
Dan: Fresh books.
Rob: I know but clients love it, they comment how professional it is and it makes it just so easy for me to invoice people, for me to collect the cash from them. The other one I use all the time as well is Time Trade for scheduling calls with clients.
Dan: So Time trade and Fresh Books. What do you do for fun?
Rob: What I do for fun, one of my big loves is actually I live about a hundred yards from the shore of Lake Ontario so just walking down by the water, watching the yachts and the marina here and taking time away from work and just to relax in.
Dan: Beautiful. What is the most rewarding thing you have been able to do for someone because of your success?
Rob: So back in 2010, at the time when my business hadn’t recovered yet, I was still struggling that was the year that they had the earthquake in Haiti. Knowing that I was moving across to Canada and that there was a big Haitian community here in Canada. I got in touch with a charity that was helping the recovery and I said look I had to come over to Canada, I will run a workshop and all the profits will go into the charity and so I fill myself over, I don’t include that in the ad. The only thing that came out of it was the amount that they charged us for the room, everything else I put straight into charity. And then of course you get the feedback about you, here’s the roof that we are putting on the school and all that. Yeah so it was the ability to help that I had no—the only connection I had with was that we were fellow human beings and that they were in the worst position than I was.
Dan: Fantastic and at the end of the day, that is what success is about. Rob any final thoughts you want to share with our listeners and then also your contact information if they want to find out more of your book publishing program or any other programs that you have?
Rob: Sure, the biggest piece of advice I would give is stop finding excuses to not get out and do stuff. Stop finding excuses to not raise your prices, to no write a book, to not launch a premium product, or service of some kind. Just do it. In terms of contact information, the easiest thing is my website which is robcuesta.com. They can actually go there and pick up a free copy of one of my books Tested Authority which actually tells them how to use the book that they haven’t written yet to get clients.
Dan: Nice, very nice. They can go to your website and then also they can go to Amazon.com to purchase any of the books you are talking about.
Rob: Absolutely. When people say to me, how can I get hold of you? I would just say just search for me in Amazon.
Dan: That’s ROBCUESTA.COM on Amazon as well.
Rob: Yeah without the .com.
Dan: Without the .com on Amazon or they would go to your website directly. Awesome. Rob thank you so much for inspiring us today with your story and your ideas and your strategies, thank you so much, I appreciate it.
Rob: Thank you. Bye bye Dan.
Dan: Thank you.