Oct. 1, 2024

Referral Strategies and Strategic Partnerships & Joint Ventures

Learn how to put in place effective Referral Strategies, Strategic Partnerships, and Joint Ventures in order to get ahead (and stay ahead) of the competition.

So today’s show is about developing a Referral Strategy and creating Strategic Alliances...

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Learn how to put in place effective Referral Strategies, Strategic Partnerships, and Joint Ventures in order to get ahead (and stay ahead) of the competition.

So today’s show is about developing a Referral Strategy and creating Strategic Alliances and Joint Venture Partner relationships. We also touch on using the conversion formula to improve your chances of success with these kinds of joint venture programs. This helps you with more than just your revenue, this helps you manage costs.

Powerful Business Strategies is broadcast live Mondays at 12 Noon ET Music on W4CY Radio (www.w4cy.com) part of Talk 4 Radio (www.talk4radio.com) on the Talk 4 Media Network (www.talk4media.com January Jones Sharing Senior Success is viewed on Talk 4 TV (www.talk4tv.com).

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WEBVTT

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The topics and opinions expressed in the following show are

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solely those of the hosts and their guests and not

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those of W FOURCY Radio. It's employees are affiliates. We

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make no recommendations or endorsements for radio show programs, services,

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or products mentioned on air or on our web. No

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liability explicitor implies shall be extended to W FOURCY Radio

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or it's employees are affiliates. Any questions or comments should

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be directed to those show hosts. Thank you for choosing

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W FOURCY Radio.

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Welcome to Powerful Business Strategies, where you will find out

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that everything you have ever learned about growing your business

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is wrong. Finally, a show where you'll learn the right

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way to grow your business by learning business and financial

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strategies that your competition isn't doing. And now here's your host.

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Resident of Next Step CFO Michael Barbarita and joining Michael

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for today's show as an executive moderator is chooky obia.

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Yes, this is chooky, and I believe that gratitude is

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undefeated and growth is about the next step. And it

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is an honor for me to moderate today's discussion with

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my good friend Michael.

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Michael, how are you great. How's it going, Chookey, It's

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going well, excellent, and yes, my name is Michael bab Rita,

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President of Next Step CFO, and Next Step CFO is

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a fractional CFO and strategic implementation firm, and our vision

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is to ensure overwhelmed business owners achieve the time, freedom

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and consistent profits to build a legacy and live the

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life they desire. Our mission is dedicated to guiding small

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business owners to leveraging their time, exploding their profits, and

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build a meaningful legacy. This show, Powerful Business Strategies and

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our book of the same name, is a step toward

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accomplishing that vision and mission. And so with that, I'd

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like to hand it back to my co author and

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moderator for the show, Choky Obio. Michael, thank you.

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Look, we have a number of business owners coast to

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coast joining us for today's episode, and Michael, I think

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it would be worthwhile for us to just acknowledge that

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a number of these business owners have been devastated by

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the hurricane and again our thoughts and prayers, and we

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really appreciate in fact, some of these folks are so

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loyal to the show that they're still joining even with

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some of the detrimental and devastating effects that they've been

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dealing with.

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So thanks to all of you.

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Now, Michael and I we've planned a really insightful, really

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robust conversation today. So just a quick disclaimer, Michael and

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I are both affiliated with a number of different organizations

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and I currently serve as the managing director of business

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Development for Vetter Price, which is a global business focused

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law firm. In addition to that, it is truly inspiring

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for me to collaborate with Michael to moderate business roundtables

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really across the country to be honest with business owners

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all over where we share insights, practical insights from our book,

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Powerful Business Strategies, and we also document new insights as

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we work on newer and newer editions of the book.

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But please note that the opinions that will be expressed

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in the show are our personal opinions based on our

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personal success and experiences. But my mission as a fearless

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leader and moderator in our discussion really is to just

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ask the right questions to help you the listener, learn

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the best business strategy strategies and then just share with

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you what the competition isn't doing right, and Michael, I'll

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toss it back over to you. You've really set the

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tone for this great work that we do with your leadership,

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with both your CEO and CFO experience, I know today's

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topic is one that's really in high demand from a

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number of small business owners.

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So I'll talk back over to you.

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Thank you to you. Kena and I too share your

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concerns and are certainly our prayers for the people who've

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been devastated by this hurricane in Florida and North Carolina.

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We've I've actually been in communication with a lot of

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a couple of business owners down there, uh and it's

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it's truly devastating, and our prayers are with them. So

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it seems insignificant. But so today's show is about developing

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a referral strategy and creating strategic alliances and joint venture relationships.

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And one of the strategic relationships I built as a

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ski retailer was with a large ski club in the

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Boston area. Now, we used to do fashion shows for

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them and support and promote their ski trips, and they

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used to endorse us as the ski shop of that club,

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and we, as a result, had many speaking opportunities to

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promote our stores and and this worked out tremendously for

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both sides. Nice. And the concepts I'm going to talk

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about today is how that you know is basically the

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same Those kind of concepts that I use to start

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that relationship are the same concepts I'm going to talk

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about today.

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Great.

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So it's remarkable, Michael, and this topic of strategic partnerships

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and joint ventures just I'm kind of fascinated by it.

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In fact, we're already getting a number of comments and

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questions and we'll get to those for those of you

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sending your comments and questions, But let me team Michael

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up with just this question. Michael, and you're really picking

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your wisdom and your brain on this. Can you describe,

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in your opinion what a referral strategy is?

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Excellent? Yeah? Well, the thing the thing is, you know

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you mentioned the word it's a strategy. Yeah, and CHOOKI.

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When you when you speak to a lot of business

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owners like we do, you ask them, hey, what's your

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number one form of lead generation?

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Correct?

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They typically say referral or word of mouth, and he

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is referral lead generation. Although great, it's hard to scale

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because you just never know when somebody is going to

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refer to you, or when someone's going to speak your

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name in a positive way and someone's going to become calling.

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Because we don't know that it is difficult to scale,

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but it doesn't mean that it's not effective, and it

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doesn't mean that we're not going to talk about ways

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that you can scale it in this show. So you know,

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we do know that referrals just awesome ways to get

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leads because they're from someone they know, like and trust.

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But the challenge in many cases is the business owner

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doesn't have a strategy behind controlling those referrals intentionally. So

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let's get into the heart of this, right Michael.

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And there are number of business owners listening, and some

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of them are skeptical, right, you know, they get your

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point about how this is a strategy. They get the

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point about how this is something that they really should

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invest some time and effort in. So question for you,

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how do you typically go and address these issues with

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business owners?

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I mean, who.

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Maybe they're not necessarily getting referrals and they're not necessarily

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actually kind of building out a strategy for them, So

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how can they prepare for their growth?

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Excellent? Well, yeah, the key thing is if you think

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about it. When a person does business with you, they've

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exchanged money. They're giving you money in exchange for goods

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and services, and that's certainly a great thing. And when

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they're satisfied and they tell someone else, that makes it

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even better. So the strategy, and first of all, let's

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define what a strategy is, because a lot of people

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aren't really clear as to what a strategy is. A strategy,

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strategies and powerful business strategies is what we talk about

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on this show, So we should obviously define what a

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strategy is. A strategy is a series of tactics done

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over and over again in the same exact order in

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order to get a predictable result. So with the referral strategy,

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we have a happy customer, so we want to make

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it part of our sales process that as soon as

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that person buys, we know that they're happy, then we

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implement the referral strategy so we can manage it, track

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it and make sure it's effective.

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That's a remarkable point, Michael, and I too think you

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know a lot of times when you're building out a strategy.

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Business owners who I know both personally and professionally, and

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I've worked with in the past, they'll sort of they'll

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execute the referral strategy upfront with people that they've already

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worked with. Now is that the right way to do

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that or is it better to execute it when they

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actually sort of have someone in mind that they want

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to refer And how would you advise on making sure

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that you know people are out there you're working for

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you in some ways, right, I mean this are not employees,

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but these are satisfied, effective patrons of your business, right,

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they're out kind of working for you and spreading the

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good message about your business.

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How do you make sure of that?

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Yeah, that's a great question. So what I found, Choky,

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is that the best time to ask for a referrals

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when the customer is the happiest. Typically typically typically that's

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at the point of purchase or when they've seen a

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result of some kind. That's when they're really happy and

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they want to tell the world about you and brag

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about how great you are. So that that's where you

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want to implement that strategy when they're the happiest. It

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could be at the beginning of the process, and we

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have a strategy for that I'll talk about later on,

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but it could be also at the end of the

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process or where you know you did something great for that. Now,

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so let me share an example. So here's here's something

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a car dealership implement that that was incredibly successful, and

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they did it after the customer was happy. So a

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person bought a car and the car came back from cleanup.

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It's nice and shiny, it's pretty. The buyer is excited,

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they've gotten their little walk around. They're ready to take

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it home. So that's the perfect time to ask for referrals.

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And let me tell you the strategy that was implemented

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in this particular dealership that increased their sales by forty

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percent from justice one referral strategy, and it also increased

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this is interesting, it also increased their gross profit on

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those deals by seventy percent versus the people who bought

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without knowing them. In other words, they were able to

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get higher prices from the referred business versus walk ins.

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But here was the strategy. So once the salesperson and

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the customer did the final walk around, the customer was

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satisfied before they left, they would take either a twenty

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fifty or one hundred dollars bill. So let's for this example,

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let's say they used a fifty dollar bill. So they

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took a fifty dollar bill nice and Chris, nice and new,

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and then rip it in half and they say, here

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you go, mister and missus. Customer, take the half of

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the fifty dollar bill. Now, if you'd like the other half,

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go on your phone and think about five people right

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now who you know that, whether it's now or sometime

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in the future, may be looking to purchase another car.

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And the customer would just write down the names and

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contact information, and then the salesman gave the other half

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of the fifty dollar bill. Now, if they wanted ten referrals,

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guess what, they pulled out the hundred dollar bill and

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did the same thing. So here's the you know and

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the customer you know. After they pulled out their phone,

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here are ten names and phone numbers. That was an

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amazing strategy, and they did it with every single delivery

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of a car. And this example brings up a lot

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of different impact strategies that we talk about all the time,

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one being that this strategy increased the number of leads

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but also the conversion rates. But the point is is

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that these referral strategies are best implemented at the peak

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of somebody's happiness when they're purchasing, when the customer service

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is the greatest, and you ask at that point, and

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it really does help a lift a lot of businesses.

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So, Michael, how do you recommend applying this strategy with.

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Those businesses and business owners who maybe just haven't really

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thought about this before. Right, And they're listening now, and

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you know, maybe even later they'll listen sort of on

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the replay and they're saying, you know what, that all

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sounds good, Right, I want a forty percent increase in sales.

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How do I even get started? How do I begin?

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Well? Chokey, when when you listen to shows like this

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and get the examples we share, it stimulates the mind

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to think about something that would be of value to

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your cut to the people who are listening, to the

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small business owners who are listening their customers. And first

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of all, the expectation is when you're certain that you're

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going to deliver on your promise, then you ask someone

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to refer someone else to give. That's when you ask

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someone to refer someone else to which you're going to

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deliver the same value to them. And it may, by

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the way, it makes that person who referred you look

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good as well. Yeah. So here's another example of another

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referral strategy that we've seen. And once again, we have

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to be certain that we're going to get the outcomes

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for our clients and they know that they desire because

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this is a front end of the relationship strategy versus

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the back end with the car dealership. So in this example,

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and by the way, a little later on, I want

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to talk about being confident your product, but I'll get

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to that. But in this example, the company has an

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expectation of a customer to tell others, and so in

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their upfront agreements Chooky, it's part of their agreement that

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they must refer three additional customers that they know that

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could benefit from the product or service. It's just part

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of what they do because they expect to produce a

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good result and the customer expects to get a good result,

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and so it's part of their process. It's part of

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their agreement. And if you caught that, it's a way

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to hold your clients accountable, to help spread the good

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word about what you're doing. And so and you know,

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obviously you're not going to hold to take the customer

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court if they're not obligating that part of it, but

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you keep reminding them about that, keeping them accountable to

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make those referrals to you. Now some say some would say,

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aren't you putting too much pressure on a customer or

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I'm shy about asking for referrals I can' and to that,

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here's the thing. If you're confident that you can deliver

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what you say you deliver, and you're confident that you'll

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get a good result, then you're helping people. By having

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a referral strategy. You're helping more people, including the customer

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who you are asking to make the referrals versus verses.

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Think about the opposite of that, not asking for the referral,

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not having a referral strategy, being shy when you don't

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ask for referrals because you think you are being self

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serving with the customer or you're shy you don't want

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to be aggressive. Think about all the potential people you

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are depriving to improve their lives. At the very least

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you're depriving them of the opportunity to improve their lives.

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Is helping people proving their lives self serve me? Think

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about that. The way I look at it is. It's

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your absolute obligation to be aggressive, to ask for referrals

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so that you can improve other people's lives. Now, if

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you don't believe in your product or service, or you

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think it's just like everyone else's, no better, no worse,

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then I understand why you're shy, why you don't want

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to be and I understand why you don't want to

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be aggressive. And guess what, figure out how to add

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more value to your product of service and build your

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own confidence. We have had a couple of shows at

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least on this in terms of adding more value to

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your product or service. So go out there, add more

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value to your product of service, Go back and listen

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to those shows at Powerful Business Strategies dot com, and

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go out and build your own confidence. And don't over

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complicate that some simplicity of these powerful referral strategies. Just

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go out there and do it. Why because you're because

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you're certain that you're going to deliver the outcome that

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your clients expect. You're going to help solve their problem.

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Be the catalyst. Be excited enough to compel others to

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get excited to tell others about the experience. Don't let

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fear get in the way of a good strategy. Yes,

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so now talking about strategic alliances. So now let's discuss

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strategic alliances and joint venture partnerships. Now here's the challenge

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in the world of small business, where every resource counts

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and competition looms at every corner. Growth and sustainability sustainability

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can seem like an uphill battle in today's competitive forming

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strategic alliances and joint ventures is more than just a

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growth strategy. It's a survival tactic for small businesses. It's

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a real game changer. What if the missing piece in

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your growth strategy is collaboration. Let's explore the transformative opportunity

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that strategic alliances and joint venture partnerships bring. Now, there's

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a lot of power in strategic alliances. They're your gateway

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to shared resources, innovation, and unlocking new markets. Imagine combining

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forces to amplify your strength and mitigate your weaknesses. Here's

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some of the benefits through strategic alliances. Envisions slashing your

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operational costs. And if this time I'll go over that too,

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Because every time we think of strategic partnerships, we think

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of revenue generation, where in actuality, I can share a

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couple of experiences where I actually reduced my cost through

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pooling resources. So through strategic alliances and envisions, slashing your

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operational cost, captivating new customer segments, elevating your brand, enriching

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your product line. Now let's go into a little bit

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more of an explanation of joint partnerships. So, joint partnerships

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are your bridge to pulling expertise, sharing risk, doubling down

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on achieving common goals and shared rewards, and some of

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the advantages. Once again, by leveraging your combined unparalleled expertise,

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you can breach new markets, ignite innovation, and track more

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business growth with a joint venture approach. Have you ever

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thought someone would make a great strategic partner and then

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you talk about it with the other partner, get excited

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as well, and then it fizzles out. Have you ever

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had that situation? You talk with somebody in a one

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to one situation and they say, yeah, it would be great, Yeah,

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I think we if we work together, it would be wonderful,

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And both sides say that, and then there's probably not

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another discussion about it, or if it is, it's perfunctory

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in nature. So in crafting your strategic alliance. And in

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order to successfully implement this strategy, let's dive into the

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steps that you must owtake. First, identify potential partners who

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will complement your business strengths and they share your objection objectives.

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So I want you to think about whether they offer

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products or services before, during, or after your customer journey.

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Let me say that again. So I want you to

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think about whether they offer products or services before, during,

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or after your customer journey. For those businesses that fall

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into one of those categories, these are your allies. Next,

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establish clear goals and objectives for the alliance of the partnership.

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This is where a lot of situations that I mentioned

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earlier fizzle. This clarity will guide your collaboration toward mutual success.

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Develop a mutually beneficial agreement that outlines each party's contributions

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and responsibilities. And here is something that is of alter

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importance and that determines, and that is to determine what

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success looks like for each party. If you can't identify

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what success looks like, not only for you, but for

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the other party, how can you expect it to work? Really,

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it just won't. You have to identify what success looks

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like for each party. That way, they have clarity on

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what the benefits are, on what the endgame is, on

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what the goals are. You want to ensure that the

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roles and resources are clearly defined, laying the groundwork for

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effective collaboration. Lastly, establish open and transparent communication channels. Regular

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and clear communication is the backbone, literally the backbone of

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any successful partnership, ensuring that all parties are aligned and

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can address challenges proactively. So, in other words, have regular meetings. Yeah,

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that's how you keep those that communication flowing. The reason

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why your strategic partnerships have failed to get the first

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or second base because you're not following these steps. So

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let's talk about success in action. Countless small business owners

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have catapulted to success by embracing strategic alliances and joint ventures,

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and certainly yours could be next. Keep in mind, the

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only alliances that work are ones where accountability and revenue

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targets are established and clarity around execution is defined as well. Now,

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although you're creating a win win for all involved, always

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stress how the other party will win by doing their part.

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Meeting with someone at networking event and then saying would

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make a great alliance like I said earlier, that's a

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sure way to fail. Don't do this as for a meeting.

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So you can follow the steps I'm about to give you.

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And if you want to sustain successful alliances, you have

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to take a deeper dive with each other. And as

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you embark on this journey, remember to elevate your current

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alliances if you have any and other potential ventures that

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you're working on, because then it's when when you have

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other ventures, other joint venture partners, the other side gets

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the feeling that you know what you're talking about, you

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know how to develop these things, you know how to

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uh set them up execute. So let's first talk about

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how to find partners. Consider your client. Uh consider what

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your client needs before, during, and after the engagement with

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your product or service. That's step you know, that's a

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that's a very important point. We mentioned it a little earlier.

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Consider what your clients need before, during, and after the

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engagement with your product or service. What's that customer journey

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look like? And by identifying these businesses that serve your

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target market in a complementary way, that can reveal lucrative

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opportunities for this collaboration. Now focus on areas where you

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can test alliances and joint ventures for immediate impact. Now,

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be very strategic about whom you approach, ensuring the line

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with your business goals to the biggest long term benefit.

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And remember you're playing this for the long game. This

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isn't some kind of short term strategy. This is a

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long term strategy. Determine your unique value to a potential

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partner and make your proposals compelling. Now, when making your

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offer to a potential partner, I like the value you

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bring to the table. Show them how the partnership will

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generate profit, and outline the expected results for both sides. Now,

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always use conservative estimates to build trust and to ensure

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mutual confidence in the in adventure success plan your implementation methodically,

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you want to gather the necessary information, assign a responsible

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team member, and set a reasonable deadline for achieving your goals.

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So establish clear benefits for sets and also understand what

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the consequences of failure look like as well. It's important

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to note that also determine the best way to communicate

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your interest in joint ventures or alliances, whether it's through

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direct mail, phone calls, or in person meetings. Choose the

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method that best suits your collective target partners and prepare

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scripts for each scenario to ensure that your message is

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clear and also persuasive. And then finally set a start

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date for your test and determine how you'll measure success.

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Tracking results will give you will help you refine your

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approach and maximize the impact of your strategic alliances and

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joint venture. You got to track results, otherwise you can't

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follow what's happening. You want to be able to identify

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what's happening. And by the way, tracking results will also

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identify where your weaknesses are and so to elevate your

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small business through strategic alliances and joint ventures. Right now,

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the future of collaboration starts with you. And so let's

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build upon that structured approach that we just talked about

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and develop a referral strategy by incorporating a step by

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step guide for implementation by using an example. Essentially, I

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want to walk you through these steps with this example.

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So in this scenario, I'm going to demonstrate how a

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business can strategically position itself within a customer's journey by

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leveraging partnerships for mutual benefits. So imagine a homeowner who

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decides to undertake a complete home renovation project. Their journey

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involves several steps from planning and design to the final touches.

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In this example, we're going to focus on an interior

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design firm speaking to establish strategic alliances and joint ventures

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within this renovation journey. So let's identify some of the

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customer's steps that they'll take in this journey. So, first,

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the homeowner starts with an architect to play in the renovation. Next,

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there's the interior design firm. So once the structural plans

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are in place, they seek this interior design firm to

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plan the aesthetics. Next is the construction company. With the

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designs ready, a construction company is hired to execute the renovation.

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Next is the furniture store. Following construction, the homeowner looks

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for furniture that matches the new interior design and to

439
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compliment the furniture, the homeowner then seeks out what I'm

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calling home the core. Then there's the smart home technology providers,

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because the final step involves integration of smart home technology

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for the modern touch. Okay, So in this chain and

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in this example, the Aeria design firm is our focal point.

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As I mentioned, seeking to establish a network of referrals

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with companies both upstream and downstream in the renovation journey.

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So Step one is to identify potential partners. So the

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interior design firm identifies potential partners in both directions of

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the customer journey architects and construction companies upstream and furniture

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and home to course stores, and the smart home technology downstream.

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Step two craft tailored proposals, So the interior design firm

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creates tailored proposals for each potential partner, highlighting the benefits

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of the referral chain. Now proposals emphasize enhance customer satisfaction,

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a seamless project flow, and the potential for increased business

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through these mutual referrals. Step three and negotiate. With proposals

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in hand, the interior design firm approaches each potential partner

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and discusses the specifics of the referral agreement, including any

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commission structure or reciprocal marketing efforts. Step four finalize the agreements.

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So formalize agreements with each party, clearly defining the referral process,

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communicating the protocols and the financial arrangements. Step five is

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to implement a tracking system. You want to implement a

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system to track the referrals and the outcomes. This is

462
00:30:40.920 --> 00:30:44.880
very important. This way you ensure transparency and accountability in

463
00:30:44.920 --> 00:30:50.240
the relationship. Step six, Launch the partnership and monitor with

464
00:30:50.440 --> 00:30:55.079
everything in place. Officially launched the partnership, and this could

465
00:30:55.119 --> 00:30:59.640
include joint marketing efforts such as co branding content or

466
00:30:59.640 --> 00:31:07.039
event all showcasing the partnership's benefits to potential customers. Any

467
00:31:07.079 --> 00:31:09.759
one of those, and you'll also have to make sure

468
00:31:09.839 --> 00:31:15.160
to regularly monitor the partnership's performance, adjusting strategies as needed

469
00:31:15.240 --> 00:31:17.960
to ensure that all parties are receiving mutual benefit. There

470
00:31:18.039 --> 00:31:21.079
might be adjustments to the original plan that happens, probably

471
00:31:21.079 --> 00:31:25.279
more likely than not. Step seven is to nurture and

472
00:31:25.400 --> 00:31:30.240
expand continuously nurture the relationship through regular check ins and

473
00:31:30.319 --> 00:31:37.960
collaborative opportunities. Now, as the network proves successful, consider expanding

474
00:31:38.000 --> 00:31:43.160
by adding new partners or exploring additional services and products

475
00:31:43.160 --> 00:31:47.039
that can be offered. By focusing on specific examples within

476
00:31:47.079 --> 00:31:51.480
the customer's journey, we've demonstrated how a business can identify

477
00:31:51.519 --> 00:31:57.920
potential partners, craft compelling proposals, and negotiate mutual beneficial arrangements.

478
00:31:58.880 --> 00:32:03.240
You see this structure approach enhances the business's network and

479
00:32:03.359 --> 00:32:08.119
significantly improves the customer's experience by providing a seamless journey

480
00:32:08.839 --> 00:32:14.920
through trusted partners. Now, implementing this strategy requires careful planning,

481
00:32:15.000 --> 00:32:18.200
clear communication, ongoing management, and I understand that's a lot

482
00:32:18.200 --> 00:32:25.519
of work, but the rewards include expanded reach, increased business

483
00:32:25.559 --> 00:32:29.559
and strength of relationships within the industry. And by adapting

484
00:32:29.599 --> 00:32:33.839
a customer centric view and leveraging the interconnectedness of related services,

485
00:32:34.240 --> 00:32:37.519
businesses can unlock new growth opportunities and build a strong

486
00:32:37.559 --> 00:32:43.880
foundation for long term success. So through strategic alliances and

487
00:32:43.960 --> 00:32:48.799
joint ventures, your company can expand its reach and transform

488
00:32:48.839 --> 00:32:52.039
the journey into a seamless and satisfying experience for your partners.

489
00:32:52.079 --> 00:32:57.680
Keep in mind, in unity, there's strength. In partnership, there's

490
00:32:57.759 --> 00:33:01.960
endless potential. And so one of the things that I

491
00:33:02.039 --> 00:33:07.880
want to double down on, if you will, it's important

492
00:33:08.480 --> 00:33:14.119
during your collaboration to assign responsibilities to both you and

493
00:33:14.240 --> 00:33:19.759
the partner in the partnership. This is really important because

494
00:33:20.599 --> 00:33:23.240
the work shouldn't all be on you. It's a partnership

495
00:33:23.440 --> 00:33:27.000
and it's a strategic alliance. So there's going to be

496
00:33:27.079 --> 00:33:31.720
things that the strategic partner is going to be good at,

497
00:33:32.720 --> 00:33:34.240
and there's going to be things that you're going to

498
00:33:34.240 --> 00:33:38.720
be good at. And identifying those strengths and weaknesses and

499
00:33:39.240 --> 00:33:44.079
issuing responsibility and tasks to the other party as well

500
00:33:44.119 --> 00:33:48.519
as yourself lends itself to a very fair, equitable, and

501
00:33:48.799 --> 00:33:54.839
strong partnership. So it is really important because there is

502
00:33:54.880 --> 00:33:57.200
a lot of work involved in a strategic partnership. It's

503
00:33:57.279 --> 00:33:59.920
not it's not one of these things where one meeting

504
00:34:00.039 --> 00:34:03.319
that was the trick, because you know, I mean, as

505
00:34:03.440 --> 00:34:05.279
as I talked about earlier, if you're going to have

506
00:34:05.279 --> 00:34:08.320
one meeting and everybody's gonna get excited and then nothing

507
00:34:08.400 --> 00:34:14.039
happens and it fizzles out, what's the point. So I

508
00:34:14.119 --> 00:34:20.599
have a little time to talk about strategic partnership sharing expenses.

509
00:34:22.480 --> 00:34:24.719
When I was in the frozen cookie dough business, one

510
00:34:24.719 --> 00:34:29.400
of the things that I had to have was frozen

511
00:34:29.519 --> 00:34:34.000
storage for my inventory. I mean, it couldn't it couldn't

512
00:34:34.000 --> 00:34:35.840
sit out in the sun. It was frozen cookie dough,

513
00:34:36.400 --> 00:34:40.719
so it had to be in frozen storage. And so

514
00:34:42.159 --> 00:34:46.559
with with frozen storage comes minimum you know, minimum pricing

515
00:34:47.440 --> 00:34:51.519
where you have to uh store X amount of units

516
00:34:52.000 --> 00:34:55.599
to be able to get a price break. Well, when

517
00:34:55.639 --> 00:34:58.480
I was starting out, I didn't have I didn't have

518
00:34:58.519 --> 00:35:00.239
a lot of inventory. I didn't want to have a

519
00:35:00.239 --> 00:35:03.280
lot of inventory until I started selling it. And so

520
00:35:03.639 --> 00:35:08.719
what I did was I developed a relationship with a

521
00:35:08.800 --> 00:35:16.320
frozen appetizer company, totally different business, but they needed frozen storage,

522
00:35:16.599 --> 00:35:19.559
and so we collaborated our efforts and we then found

523
00:35:19.599 --> 00:35:26.239
a frozen dessert company and then collaborated our resources and

524
00:35:27.039 --> 00:35:30.480
we were able to reduce the cost twenty percent as

525
00:35:30.480 --> 00:35:35.480
a result. Where we had our frozen storage was split,

526
00:35:36.039 --> 00:35:39.840
it was under one account. We each paid a third,

527
00:35:40.800 --> 00:35:45.119
and it made it so cost effective. And so once

528
00:35:45.159 --> 00:35:47.760
we established that relationship, we did the same thing with

529
00:35:47.920 --> 00:35:53.199
office supplies. We found office supply vendors who had quantity

530
00:35:53.239 --> 00:35:57.159
discounts if you if you purchased a certain amount. We

531
00:35:57.159 --> 00:36:01.079
were able to share a couple of like hind ingredients,

532
00:36:02.880 --> 00:36:05.400
and so we're able to buy a palette instead of

533
00:36:05.880 --> 00:36:12.199
you know, little packaging. And so there's when we talk

534
00:36:12.239 --> 00:36:17.199
about strategic partnerships. We don't just talk about the revenue side.

535
00:36:17.719 --> 00:36:22.719
We also talk about the expense side. And they'll be opportunities,

536
00:36:23.480 --> 00:36:25.599
So you should keep it in mind not just the

537
00:36:25.639 --> 00:36:29.280
revenue side, but the expense side, because there'll be opportunities

538
00:36:29.320 --> 00:36:32.960
to share marketing costs, there'll be opportunities to share supply costs,

539
00:36:32.960 --> 00:36:40.719
There'll be opportunities potentially to share your material material costs

540
00:36:41.400 --> 00:36:46.880
like we did with ingredients. And so with that collaboration

541
00:36:47.079 --> 00:36:51.719
and that group, the strength of a group when it

542
00:36:51.719 --> 00:36:54.480
comes to buying and the buying power that a group has,

543
00:36:55.239 --> 00:36:59.480
it's incredible, absolutely incredible. And so don't just think of

544
00:36:59.519 --> 00:37:04.199
strategic partnerships as revenue generation, although they're fantastic at that,

545
00:37:04.840 --> 00:37:11.400
They're also think about them to share expenses. And so, CHICKI,

546
00:37:11.519 --> 00:37:13.840
one of the things that I talked about in the

547
00:37:13.880 --> 00:37:18.360
last three or four shows was the position of market dominance,

548
00:37:18.400 --> 00:37:22.760
and so I have a little time today to revisit

549
00:37:24.840 --> 00:37:28.920
that a little a segment regarding the position of market dominance.

550
00:37:28.960 --> 00:37:32.760
So to understand the position of market dominance, you have

551
00:37:32.840 --> 00:37:36.719
to understand the conversion formula. And so i'd like to

552
00:37:37.119 --> 00:37:40.719
although we have shows totally dedicated to this at Powerful

553
00:37:40.760 --> 00:37:45.159
Business Strategies dot com where people can listen, I wanted

554
00:37:45.159 --> 00:37:49.559
to give the live listening audience an opportunity to understand

555
00:37:49.599 --> 00:37:54.519
what the position of market dominance is and the benefits

556
00:37:54.519 --> 00:37:57.719
that it has, because if you go back and listen

557
00:37:57.719 --> 00:38:03.320
to the shows, the benefits are just incredible with the

558
00:38:03.400 --> 00:38:07.480
right position of market dominance. But to understand the position

559
00:38:07.519 --> 00:38:09.719
of market dominance, you need to understand what we call

560
00:38:09.800 --> 00:38:13.920
the conversion formula. Now here's the thing about the conversion formula.

561
00:38:13.960 --> 00:38:16.079
It's a four pot formula that allows you to address

562
00:38:16.119 --> 00:38:19.679
the prospect's problem and solution and do so at just

563
00:38:19.719 --> 00:38:23.239
the right time, dislike if you're in the prospect's mind.

564
00:38:23.880 --> 00:38:26.440
And it must be followed just like any other formula,

565
00:38:26.480 --> 00:38:31.039
with all four parts executed in the right order. Otherwise

566
00:38:31.079 --> 00:38:33.719
it just doesn't work. So it's got to be followed

567
00:38:34.000 --> 00:38:39.639
very precisely. So here's the formula. It starts with what

568
00:38:39.639 --> 00:38:43.079
we call the captivate. It's a headline and it happens

569
00:38:43.119 --> 00:38:45.239
to be the problem that the customer has that they

570
00:38:45.239 --> 00:38:50.280
don't want. It's designed to stop the prospect in their tracks,

571
00:38:50.280 --> 00:38:53.599
to interrupt them, if you will. And this headline or

572
00:38:53.639 --> 00:38:56.360
problem is the first thing you should say out of

573
00:38:56.400 --> 00:38:59.480
your mouth or that a person sees or hears from

574
00:38:59.519 --> 00:39:04.639
you or about your business, and it must really identify

575
00:39:04.679 --> 00:39:07.960
the problem they have because you only have three to

576
00:39:08.039 --> 00:39:12.320
five seconds to keep their attention. But if you identify

577
00:39:12.400 --> 00:39:17.719
what that problem is, and we have strategies on how

578
00:39:17.760 --> 00:39:20.440
to do that. We have our whole step by step

579
00:39:20.880 --> 00:39:25.559
program as to how to go about doing that. But

580
00:39:25.639 --> 00:39:28.199
you really have to identify the real problem that the

581
00:39:28.199 --> 00:39:32.039
customer has. Whether it's a problem in the industry, or

582
00:39:32.079 --> 00:39:35.679
it could be a problem with businesses in your industry

583
00:39:35.719 --> 00:39:39.519
in general, but or it could be a particular problem

584
00:39:39.519 --> 00:39:44.239
with your product. But if you can identify that problem,

585
00:39:44.519 --> 00:39:48.000
that's the first step of the conversion formula. The second

586
00:39:48.000 --> 00:39:53.639
step is something we call fascinate. Now that you've interrupted

587
00:39:53.639 --> 00:40:01.480
the customer, you've captivated them, if you will the with

588
00:40:01.599 --> 00:40:04.599
the problem itself. We have to keep their attention and

589
00:40:04.679 --> 00:40:07.440
we have to engage them with a sub headline or

590
00:40:07.480 --> 00:40:11.119
the second thing they see, which happens to be your

591
00:40:11.280 --> 00:40:17.159
solution to that problem that they can't find. You see,

592
00:40:18.000 --> 00:40:21.119
these first two parts of the conversion formula is what

593
00:40:21.159 --> 00:40:26.679
we call the position of market dominance. It's it's how

594
00:40:26.719 --> 00:40:29.360
you enter the conversation that's taking place in the mind

595
00:40:29.360 --> 00:40:33.719
of the prospect. So to captivate and fascinate, you enter

596
00:40:33.880 --> 00:40:38.400
the emotional triggers that the customer had because people buy

597
00:40:38.559 --> 00:40:43.119
emotionally and then back that up logically. So I'm gonna

598
00:40:43.159 --> 00:40:45.599
repeat it one more time. These first two parts of

599
00:40:45.599 --> 00:40:49.320
the conversion formula are the key to successful marketing. If

600
00:40:49.360 --> 00:40:52.360
these two first two parts don't work, the formula will

601
00:40:52.400 --> 00:40:54.639
not do its job, and the third and fourth part

602
00:40:55.239 --> 00:40:59.119
will not work. And those first two components are called

603
00:40:59.119 --> 00:41:01.239
the position of market dominance. And you need to get

604
00:41:01.239 --> 00:41:04.000
the position of market dominance right, which is to captivate

605
00:41:04.320 --> 00:41:08.440
and fascinate of the conversion formula, the problem and the

606
00:41:08.480 --> 00:41:15.039
solution or the conversion formula falls apart. So now educate. Now,

607
00:41:15.360 --> 00:41:17.840
the third component of the conversion formula is we have

608
00:41:17.920 --> 00:41:21.199
to educate them. Now that we've captivated them and got

609
00:41:21.199 --> 00:41:25.199
their attention, it's ordinarily difficult to do. We have the

610
00:41:25.280 --> 00:41:28.159
time to give the prospect more information on how we

611
00:41:28.199 --> 00:41:32.239
go about solving the problem. Remember how I said that

612
00:41:32.320 --> 00:41:35.440
people buy based on emotion and then back up that

613
00:41:35.480 --> 00:41:40.480
emotion logically. Well, that's the beauty of the conversion formula.

614
00:41:40.840 --> 00:41:44.079
With the captivate and the fascinate the problem and the solution,

615
00:41:44.599 --> 00:41:49.079
you are hitting the emotional triggers of the prospect. The

616
00:41:49.360 --> 00:41:57.000
educate is the logical trigger. The educate allows somebody to

617
00:41:57.119 --> 00:42:02.000
explain to a spouse or somebody else if necessary, to

618
00:42:02.039 --> 00:42:08.400
make a buying decision, the logic behind the decision. So

619
00:42:08.639 --> 00:42:13.760
that third component is really important because it enters, it

620
00:42:13.920 --> 00:42:17.760
introduces the logic because what you do during the educate,

621
00:42:17.880 --> 00:42:20.880
now that you've captivated and fascinated them, you start to

622
00:42:20.920 --> 00:42:24.639
talk more go too more detail on how your goo

623
00:42:24.760 --> 00:42:30.000
about solving that problem, and that's the logic behind their purchase.

624
00:42:31.199 --> 00:42:34.320
And then finally the clothes. You know, we have to

625
00:42:34.440 --> 00:42:37.719
end the conversion formula with an offer, and that has

626
00:42:37.760 --> 00:42:40.400
to be a compelling offer, and it has to be

627
00:42:40.679 --> 00:42:43.519
one that's so resistible that the prospect would be foolish

628
00:42:43.519 --> 00:42:49.559
to turn it down. And there's five components of a

629
00:42:49.599 --> 00:42:52.000
compelling offer that I'd like to quickly review in a

630
00:42:52.079 --> 00:42:54.360
few minutes that I have before we get to compliments.

631
00:42:55.800 --> 00:42:58.559
Those five components of a compelling offer. Your offer should

632
00:42:58.559 --> 00:43:02.880
include one or more of these components. Number one urgency

633
00:43:02.920 --> 00:43:09.639
or scarcity. Urgency you have until Friday to take advantage

634
00:43:09.679 --> 00:43:15.719
of this offer. Scarcity, there's only three left. Very important.

635
00:43:16.079 --> 00:43:19.760
If you provide urgency and scarcity that can be compelling,

636
00:43:19.840 --> 00:43:25.679
that can get the customer to react. Next, the second

637
00:43:25.679 --> 00:43:28.400
component of a compelling offer is a risk reversal. With

638
00:43:28.599 --> 00:43:31.440
a seller in the transaction takes most all the risk.

639
00:43:31.960 --> 00:43:35.800
It comes in the form of guarantees. I've said this

640
00:43:35.880 --> 00:43:37.519
a few times that we when I was in the

641
00:43:37.559 --> 00:43:41.119
ski business, we had a ski performance guarantee. Ski the

642
00:43:41.119 --> 00:43:42.960
ski three times, you don't like it, bring it back

643
00:43:43.000 --> 00:43:45.199
for a brand new pair. So the eight thousand pair

644
00:43:45.239 --> 00:43:48.920
of skis eight came back. Customers love to buy. They

645
00:43:49.079 --> 00:43:51.599
love to buy. They hate to be sold, but they

646
00:43:51.639 --> 00:43:56.159
love to buy. The third component is adding more value

647
00:43:56.199 --> 00:43:59.920
to your product or service, whether it's you know, when

648
00:44:00.079 --> 00:44:02.159
I was in the frozen cookie dough business, I added

649
00:44:02.159 --> 00:44:04.679
more value by adding a convection of into every sale.

650
00:44:05.760 --> 00:44:08.159
Think about adding more value. We talked about that at

651
00:44:08.159 --> 00:44:12.239
the beginning of the show. How important that is. Fourth

652
00:44:12.320 --> 00:44:15.400
is packaging and bundling products and service to together. The

653
00:44:16.159 --> 00:44:19.119
pack more products and services you package and bundle together,

654
00:44:19.159 --> 00:44:22.119
the more perception of value there is. And then, finally,

655
00:44:22.159 --> 00:44:26.239
in difference to the outcome, stay on the same side

656
00:44:26.280 --> 00:44:29.360
as the prospect, don't be across the table from them,

657
00:44:29.440 --> 00:44:33.760
lock arms with them. Here's an example. So in selling

658
00:44:33.840 --> 00:44:37.599
any product, or service. There's always certain steps that people

659
00:44:37.639 --> 00:44:40.480
have to follow or certain things that people should know

660
00:44:40.559 --> 00:44:45.079
before they buy. So you would say, so, whether you

661
00:44:45.119 --> 00:44:48.639
buy from me or someone else, there's at least you

662
00:44:48.800 --> 00:44:52.000
must take at least these next five steps. These are

663
00:44:52.039 --> 00:44:54.679
the steps you need to take in order to be

664
00:44:54.760 --> 00:45:01.480
successful in getting that product or service. So chocky, that's

665
00:45:01.480 --> 00:45:04.599
what I have for today. That's our position of market

666
00:45:04.639 --> 00:45:07.719
dominance and conversion formula. Time for compliments.

667
00:45:08.000 --> 00:45:12.679
Absolutely really excited about our business complements segment, and Michael,

668
00:45:12.719 --> 00:45:14.920
to put a ribbon around the point as it relates

669
00:45:14.920 --> 00:45:20.480
to strategic alliances and joint ventures, which you articulated just

670
00:45:20.599 --> 00:45:23.320
so powerful. It was actually taking some notes, Michael, I'll

671
00:45:23.360 --> 00:45:25.840
go back and sort of review this really good stuff.

672
00:45:27.079 --> 00:45:30.360
The last point about the conversion formula is really interesting

673
00:45:30.719 --> 00:45:33.159
in like a sentence or two, and I think this

674
00:45:33.280 --> 00:45:35.199
captures some of the questions that we've been getting. How

675
00:45:35.199 --> 00:45:38.480
does a business owner combine this idea of a conversion

676
00:45:38.559 --> 00:45:42.239
formula with their strategic partnership. So should they in essence

677
00:45:42.239 --> 00:45:44.079
maybe even go through some of the steps with their

678
00:45:44.119 --> 00:45:45.079
strategic partner?

679
00:45:46.440 --> 00:45:52.039
Yeah, well exactly, they should, absolutely should, because the strategic

680
00:45:52.119 --> 00:45:54.360
partner will be intrigued on how you go about and

681
00:45:54.400 --> 00:45:58.280
do your marketing. Number one. Number two, strategic partnerships also

682
00:45:58.320 --> 00:46:03.199
involve marketing exactly, okay, and so anything that involves marketing,

683
00:46:03.639 --> 00:46:06.239
the position of market dominance and use of the conversion

684
00:46:06.280 --> 00:46:09.760
formula is paramount. And you'll hear that in all of

685
00:46:09.800 --> 00:46:13.559
the strategies that we talk about, including strategic partnerships.

686
00:46:13.840 --> 00:46:16.079
It's just so brilliant. Michael, thank you so much for that.

687
00:46:16.280 --> 00:46:21.400
So business compliments, the first business compliment is Bill Roads

688
00:46:21.800 --> 00:46:27.880
of Payment Systems of Florida. They help you find the

689
00:46:27.920 --> 00:46:30.400
best outsourcing solutions.

690
00:46:29.880 --> 00:46:32.760
For payroll and other HR solutions.

691
00:46:32.800 --> 00:46:36.880
And above and beyond the very commendable work that Bill

692
00:46:37.000 --> 00:46:40.159
and the team do. Michael and I have the opportunity

693
00:46:40.239 --> 00:46:43.760
to recently interact with Bill, and look, he's a part

694
00:46:43.760 --> 00:46:46.480
of the country that was heavily impacted by the hurricane,

695
00:46:46.599 --> 00:46:51.760
and Bill's perspective was to offer much more of a compassion,

696
00:46:51.960 --> 00:46:57.599
much more of attention to others who were impacted as opposed.

697
00:46:57.239 --> 00:47:00.760
To him and his family. It was just really remarkable.

698
00:47:00.800 --> 00:47:03.400
I mean, that shows leadership, that shows character, the fact

699
00:47:03.440 --> 00:47:06.840
that Bill's not just a great member of the business

700
00:47:06.840 --> 00:47:09.480
community there, but also just has the right level of

701
00:47:09.480 --> 00:47:13.880
compassion to really drive both the personal and the professionals.

702
00:47:13.880 --> 00:47:15.480
So Bill, hats off to you and the team.

703
00:47:15.760 --> 00:47:19.639
The next business compliment is Abby Mcaroll and she is

704
00:47:19.679 --> 00:47:22.000
with Welcome Home Family Therapy.

705
00:47:23.000 --> 00:47:23.800
Really fascinating.

706
00:47:23.840 --> 00:47:27.559
They provide this sort of online family therapy sets of

707
00:47:27.599 --> 00:47:31.159
services now they're based in California, and what I really

708
00:47:31.199 --> 00:47:34.440
appreciate about doctor Abbey and team is just this idea

709
00:47:34.519 --> 00:47:40.159
of healing families right and a lot of compliments to

710
00:47:40.199 --> 00:47:42.559
her And just to clarify, she's got a lot of

711
00:47:42.559 --> 00:47:44.719
social work experience. A lot of compliments to her and

712
00:47:44.760 --> 00:47:47.679
the team for the counseling and social experience work that

713
00:47:47.719 --> 00:47:51.719
they do. The third business compliment is Donna Aldrich with

714
00:47:52.199 --> 00:47:57.519
Go Rascal Mortgage Incorporated. She's a certified mortgage planner and consultant.

715
00:47:57.920 --> 00:48:01.079
She has some really good insights, by the way, and

716
00:48:01.159 --> 00:48:05.960
some practical tips on how credit impacts your ability to

717
00:48:06.400 --> 00:48:09.719
qualify and get approved for a mortgage. So some very

718
00:48:09.719 --> 00:48:11.480
practical insights and feel free to reach out.

719
00:48:11.400 --> 00:48:12.000
To Donna on that.

720
00:48:12.760 --> 00:48:17.440
The fourth Jennifer Olsen with Watermelon Mountain Ranch. A great

721
00:48:17.480 --> 00:48:21.159
community leader. She does a lot of outreach work. They

722
00:48:21.199 --> 00:48:26.519
help to manage New Mexico's largest no kill animal shelter,

723
00:48:26.679 --> 00:48:31.199
so doing really good work. And then last but not least, Michael,

724
00:48:31.239 --> 00:48:34.039
I mean, we've got a spotlight Bob.

725
00:48:34.840 --> 00:48:39.159
McNally and he is with Grin River Associates.

726
00:48:40.199 --> 00:48:44.159
They provide it consulting and support services to clients really

727
00:48:44.199 --> 00:48:47.840
all over New England, so all over the East Coast.

728
00:48:48.360 --> 00:48:49.199
I like their commitment.

729
00:48:49.239 --> 00:48:55.000
They've got this three S commitments, Support, solution, and security,

730
00:48:55.760 --> 00:48:57.920
and part of how they drive that three S commitment

731
00:48:58.039 --> 00:49:02.480
is to really come up with a personalized consultation plan

732
00:49:02.639 --> 00:49:04.840
for every single one of their clients.

733
00:49:04.840 --> 00:49:06.639
So all across the board, all.

734
00:49:06.519 --> 00:49:11.079
Of these business owners deserve these spotlighted compliments for the

735
00:49:11.119 --> 00:49:13.159
good work that they do and then the impact on

736
00:49:13.360 --> 00:49:14.519
their business communities.

737
00:49:14.840 --> 00:49:18.199
Michael back to you, Thank you, cheer key. So I

738
00:49:18.199 --> 00:49:21.400
want to remind our listeners to listen to any recording

739
00:49:21.440 --> 00:49:23.400
that we have of any of our shows. You go

740
00:49:23.440 --> 00:49:26.679
to Powerful Business Strategies dot com and to get a

741
00:49:26.719 --> 00:49:29.360
copy of the book Powerful Business Strategy, simply go to

742
00:49:29.360 --> 00:49:34.599
our website www dot NEXTSTEPCFO dot net. It's totally complimentary

743
00:49:34.639 --> 00:49:37.639
and until next Monday at noon Eastern time for Chucky

744
00:49:37.679 --> 00:49:41.079
Obio my name is Michael Babarita, and remember, don't keep

745
00:49:41.159 --> 00:49:43.920
doing what your competition is doing.

746
00:49:45.599 --> 00:49:48.679
You have been listening to powerful business strategies finding out

747
00:49:48.719 --> 00:49:52.360
that everything you ever learned about growing your business is wrong.

748
00:49:52.679 --> 00:49:55.880
Tune in next week and every week at noon Eastern

749
00:49:55.920 --> 00:49:59.360
time on W four CY Radio with your host Michael

750
00:49:59.400 --> 00:50:04.039
Barbarita of Next Step CFO and moderator Chuguillovio