I finished this book in January 2024. I recommend this book 4/10.
Why you should read this book:
You should read this book if you are an owner selling a product or service. The suggestions in the book will be difficult if you are a realtor or a salesperson in a software company.
🚀 The book in three sentences
It is only useful if you are selling products or services where you control the whole sales process.
It is all about value over price. Fast beats free.
Never give discounts; instead, increase the value and offerings.
This is a good book if you are running your own business, but it is hard if you are a salesperson in a bigger organization.
✍️ My favorite quotes
Jeff Bezos said, "We all know that if you swing for the fences, you're going to strike out a lot, but you're also going to hit some home runs. The difference between baseball and business, however, is that baseball has truncated outcome distribution. When you swing, no matter how well you connect with the ball, the most runs you can get is four. In business, every once in a while, when you step up to the plate, you can score a thousand runs."
Warren Buffet said, "Price is what you pay, Value is what you get."
📝 My notes and thoughts
P1. Jeff Bezos said, "Outside returns often come from betting against conventional wisdom, and conventional wisdom is usually right. Given a 10 percent chance of a 100 times payoff, you should take that bet every time. But you're still going to be wrong nine times out of ten...We all know that if you swing for the fences, you're going to strike out a lot, but you're also going to hit some home runs. The difference between baseball and business, however, is that baseball has a truncated outcome distribution. When you swing, no matter how well you connect with the ball, the most runs you can get is four. In business, every once in a while, when you step up to the plate, you can score 1,000 runs. This long-tailed distribution of return is why it's important to be bold. Big winners pay for so many experiments."
P14. He looked at me soberly and said: " Make people and offer so good they would feel stupid saying no."
P17. Although you can make the list of problems you face a mile long, which is a great way to stress yourself out. All these problems typically stem from two big Kahunas:
Not enough clients.
Not enough cash ( excess profit at the end of the month.)
P23. Let me explain. The market is continuously growing. The stock market grows at 9 percent per year. If we aren't growing at 9 percent per year, we are falling behind. "Maintenance," in the most generic sense, would be 9 percent growth every year. Furthermore, if you're in a growing marketplace, then you might have to grow 20-30 percent per year just to keep up or risk falling behind. So, you can see how maintenance is a myth. So, then, what does it take to grow? Thankfully, just three things:
Get more customers.
Increase their average purchase value.
Get them to buy more times.
P25. Having a Grand Slam offer makes it almost impossible to lose. But why? What gives it such an impact? In short, having a Grand Slam Offer helps with all three of the requirements for growth: getting more customers, getting them to pay more, and getting them to do so more times. How? It allows you to differentiate yourself from the marketplace. In other words, it allows you to sell your product based on value, not on price.
P34. In order to sell anything, you need demand. We are not trying to create demand. We are trying to channel it. That is a very important distinction. If you don't have a market for your offer, nothing that follows will work. This entire book sits atop the assumption that you have at least a "normal" market, which I define as a market that is growing at the same rate as the marketplace and that has common unmet needs that fall into tone of three categories: improved health, increased wealth, or improved relationships.
P35. Pain can be anything that frustrates people about their lives. Being broke is painful. A bad marriage is painful. Waiting in line at the grocery store is painful. Back pain...ugly smile pain...overweight pain. Humans suffer a lot. So, for us entrepreneurs, endless opportunity abounds. I have a saying I use to train sales teams: "The pain is the pitch." If you can articulate the pain a prospect is feeling accurately, they will almost always buy what you are offering. A prospect must have a painful problem for us to solve and charge money for our solution. A friend of mine had a very good system for helping people improve their resumes to get more job interviews. He was great at it. But try as he did, he just could not get people to pay for his services. Why? Because they were all unemployed!
P36. If our potential customers are all gathered together somewhere, then we can market to them. If searching them out, however, is like finding needles in a haystack, then it can be very difficult to get your offer in front of any potentially interested eyes.
P36. Growing markets are like a tailwind. They make everything move forward faster. Declining markers are like headwinds.
P37. There are three main markets that will always exist. Health, Wealth, and Relationships. The reason that those will always exist is that there is always tremendous pain when you lack them. There is always a demand for solutions to these core human pains. The goal is to find a smaller subgroup within one of those larger buckets that are growing, has the buying power, and is easy to target (the other three variables). Think about what you are good at in regard to health, wealth, and relationships. Then think about who might value your service the most (is in the most pain), has the buying power to pay what you want (money), and can be found easily (targeting). As long as those three criteria are strong and the market isn't shrinking, you'll be in good shape.
P40. The purpose of this chapter is to reinforce two things. First, don't pick a bad market. Normal markets are fine. Great markets are great. Second, once you pick, commit to it until you figure it out. If you try one hundred offers, I promise you will succeed. Most people never try anything. Others fail once, then give up. It takes resilience to succeed. Stop personalizing! It's not about you! If your offer doesn't work, it doesn't mean you suck. It means your offer sucks. Big difference. You only suck if you stop trying. So, try again.
P46. In order to understand how to make a compelling offer, you must understand value. The reason people buy anything is to get a deal. They believe what they are getting (value) is worth more than what they are giving in exchange for it (price). The moment the value they receive dips below what they are paying, they stop buying from you. This price-to-value discrepancy is what you need to avoid at all costs. After all, as Warren Buffet said, "Price is what you pay. Value is what you get."
P52. First and foremost, charge a premium. It will allow you to do things no one else can to make your clients successful. We were able to charge a premium because we provided more value than anyone else in the industry.
P57. There are four primary drivers of value. Two of the drivers you will seek to increase. The other two you will seek to decrease.
(Yay) The Dream Outcome
(Yay) Perceived Likelihood of Achievements
(Boo) Perceived Time DelayBetween Start and Achievement
(Boo) Perceived Effort & Sacrifice
P59. Logical vs. Psychological Solutions. Often, the most logical solutions have been tried and failed. At this point in history, we must give the psychological solution a shot to solve problems:
"Any fool can sell a product by offering it for a discount; it takes great marketing to sell the same product for a premium."
Logical solution: make trains faster to increase satisfaction.
Physiological solution: decrease the pain of waiting by adding a dotted map.
Physiological solution: pay models to be the hostesses on the trip (people would wish it took longer to get to their destination!)
Logical solution: make the elevator faster
Physiological solution: add floor-to-ceiling mirrors so people are distracted staring at themselves and forget how long they were on the elevator.
Logical solution: make it cheaper
Psychological solution: make fewer of them and raise the price, which causes people to want it more
P64. The only thing that beats "free" is "fast." People will pay for speed. Many companies have entered free spaces and done exceedingly well with a "speed first" strategy. A few notable examples: The MVD vs DMV, waiting in line forever or paying $50; you can skip the line and get your license renewed privately. FedEx vs USPS (when it absolutely positively has to be there overnight). Spotify vs Slow Free Music. Uber vs Walking. Fast beats free. Many will always be willing to pay (price) for the (value) of speed. So if you find yourself in a market competing against free, double down on speed.
P76. Value Offer: Creating your Grand Slam Offer—Problems & Solutions:
Identify Dream Outcome
P83. Value Offer: Creating Your Grand Slam Offer—Trim & Stack:
Create your solution delivery vehicles ("The How")
Product delivery cheat codes:
What level of personal attention do I want to provide?
What level of effort is expected from them?
If doing something live, what environment or medium do I want to deliver it in?
If doing recording, how do I want them to consume it?
How quickly do we want to reply? On what days? During what hours?
P89. Remember, it's important that you solve every problem. I can't tell you the amount of times one single item becomes the reason someone doesn't buy.
P107. Action to board a scarce resource than they are to act on something that could help them. Fear of loss is stronger than desire for gain. We will wield this psychological lever to get your clients to buy in a frenzy, all at once, until you are sold out.
Limit the supply of seats/slots in general or over X period of time.
A limited supply of bonuses
Never available again
P110. Employ one of the multiple methods of scarcity in your business. You will drive a faster purchasing decision from your prospects and at higher prices. Just let them know your limits and let psychology do the rest.
P114. The actual promotion may be the same, but naming it something different "by season" gives you a "real" differentiator that gives you a start and finish. Deadline drive decisions. By simply having these, you can point to them and let human beings push themselves over the edge so as not to miss out.
Our New Year Promotion ends January 30!
Next month: Our Valentine's Lovers Promo Ends February 30!
Next month: Our Sexy by Spring Special Ends on March 31!
Next month: Our Fools in Love April Promo Ends April 30!
P116. Adding a deadline and incorporating one or multiple forms of urgency will get more people to take action than would otherwise. I have employed all four of these methods with great effectiveness.
P118. Whenever trying to close a deal, never discount the main offer. It teaches your customers that your prices are negotiable (which is terrible). Adding bonuses to increase value to close the deal is far superior to cutting prices. It puts you in a position of strength and goodwill rather than weakness.
P122. We want to employ bonuses because they expand the price-to-value discrepancy and get people to purchase who otherwise wouldn't. They massively increase the prospects' perception of the value of our offer. So here's what to do:
Create checklists, tools, swipe files, scripts, templates, and anything else that would take lots of time and effort to create on one's own but is easy to use once created. Anything that you can invest in one time that clearly costs time or money to create but can be given away for endless time is a perfect fit for a bonus.
Beyond that, make a habit of recording every workshop, every webinar, every event, and every interview and use them as additional bonuses (as needed to crush a perceived obstacle).
Proactively negotiate group discounts and a referral commission with adjacent businesses that solve needs your customer will have as a result of beginning this process with you. What's the next natural thing they might want? Go to those businesses and get a deal for them they could never get for themselves (because you are negotiating with the purchasing power of all your customers at once, which is very powerful.
P136. My advice: Start selling service-based guarantees or setting up performance partnerships. This will make all sales final (so there is no fear of refunds). Most importantly, it will commit you to your customers' results and keep you honest. From there, either keep that guarantee and scale (perfectly fine) or move up the food chain to less restrictive guarantees to increase volume.