Funnel Hacker Radio Ep. 175 w/ Ezra Firestone - Secrets to Scaling 8 Million Dollar E-Comm Business

Funnel Hacker Radio - Podcast - Video (Russell Brunson - FunnelHackerTV)

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YouTube Transcript: English (auto-generated)

00:00
welcome to funnel hacker radio podcast
00:03
where we go behind the scenes and
00:05
uncover the tactics and strategies top
00:07
entrepreneurs are using to make more
00:09
sales dominate their markets and how you
00:12
can get those same results here is your
00:14
host Dave Woodward I’m your host Dave
00:19
Woodward today you guys are in for a
00:21
massive massive treat I have some dude
00:23
who’s up in the middle of New York
00:25
basically freezing his butt off has no
00:28
idea why his heaters not working
00:30
couldn’t get his computer started this
00:31
morning to get Skype up and running but
00:34
this guy is crushing it he is the master
00:36
the genius that one-and-only ezra
00:37
firestone welcome but ladies and
00:40
gentlemen Wow a heck of an introduction
00:42
all true all true tech failures I’m
00:46
frozen over here I’m wearing a I’m
00:48
wearing what’s known as a poncho as you
00:50
can see it this is probably a video but
00:52
that’s a legit poncho which is actually
00:53
basically like you shear a sheep and
00:56
then you just put it on your back it’s
00:58
basically what right so I’m like wearing
01:00
a sheep I’m cold I got my wife’s hat on
01:03
it’s a rough morning Dave Woodward but
01:05
I’m here because you know I have a lot
01:07
of respect and admiration for what you
01:09
guys are doing and you know obviously
01:12
we’ve had a chance to hang out at
01:14
Pirates Cove and some other times you
01:15
know I just really like you guys what
01:17
you’re up to and decided to be on your
01:19
show everyone I can’t imagine you don’t
01:23
know who is but my gosh this he is dear
01:25
friend of mine personally an obviously
01:27
of our clickfunnels she’s crushing it on
01:30
Shopify and he’s got his own products
01:32
far as if I over there
01:33
smart marker calm is his primary site
01:35
definitely definitely follow him there
01:37
he’s got an old pot cut mean if you want
01:40
to know anything about e-commerce answer
01:42
is the man the myth the legend I’m so
01:45
privileged to have your show I’ve been
01:46
trying to get you on forever we ran into
01:47
each other Brian Moran said it last week
01:49
it was like dude let’s just get our
01:51
phones this counter this thing I mean it
01:53
took us meeting in person and literally
01:54
pulling out our calendars and saying
01:56
like let the to because we were trying
01:57
to schedule it with the teams it was
01:58
like no let’s just do this together as
02:00
men all right we’re gonna come together
02:01
as men and we’re gonna schedule an
02:03
appointment and it was a big deal for us
02:04
actually it was like the first
02:06
appointment that I’ve scheduled in a
02:08
while for myself and I was I was proud
02:09
of it actually
02:11
well offline we were starting to talk
02:13
about it so I wanted to stop her
02:15
conversation cuz I mean any time you’re
02:17
with her he’s dropping value bombs all
02:18
day long and we started I’m like well I
02:21
want to capture all this so uh real
02:24
quick just understand I mean as we did
02:26
about 30 million last year but one of
02:28
the great things he’s doing is the whole
02:30
idea as far as e-commerce and this is
02:32
things we get talked about all the time
02:33
I really want to dive into this with you
02:34
guys right now what’s the right price
02:37
point of products to sell how do you
02:38
know when you’re in the right market and
02:39
you start totaling like crazy so I’m
02:41
just gonna just dive in where we work
02:43
you ever talk as far as premium products
02:46
and niches and genders and all that
02:47
stuff for sure my viewpoint is that it’s
02:50
less about price point and more about
02:51
multiple and when I see people who try
02:53
to run businesses like we run Dave which
02:56
is what we’re up to
02:57
we’re not these big guys with 300
03:00
million in VC funding you know we’re not
03:02
these people we’re scrappy
03:03
do-it-yourself entrepreneurs who are out
03:06
there in the trenches running our
03:08
businesses and attempting to be
03:09
profitable and we are using in my in my
03:12
on my side and on your side paid
03:14
amplification paid amplification as as
03:17
the means to fuel the business as sort
03:20
of the energy that drives everything and
03:22
so if you subscribe to this notion that
03:24
like your business is going to be really
03:26
built on the backbone of paid visibility
03:30
meaning you’re going out to Facebook and
03:31
you’re going out to YouTube and you’re
03:32
going out to the Google Display Network
03:33
um you’re going out to Pinterest and
03:35
Instagram and you’re saying I want to
03:36
pay to get my messaging in front of this
03:40
group of people that I think I can sell
03:42
a product to right so like that is like
03:43
baseline what I do in business at the
03:46
most fundamental level so if you’re
03:48
approaching business that way which and
03:49
then obviously look there story-based
03:51
content there’s all this other stuff but
03:52
like and we’ll get to that but it really
03:54
starts with the willingness to go out
03:55
there and buy visibility for your offer
03:57
so if you’re doing that where most
03:59
people fail is they mess up the multiple
04:01
so my viewpoint is that the absolute
04:04
absolute minimum and it gets you get
04:08
more space as you get more towards a
04:09
premium product level as I’ll explain
04:10
but the absolute minimum multiple you
04:14
can have is by for one and sell for
04:17
three and ideally you’re buying for one
04:20
and selling for four or five so here’s
04:21
what that means if I buy a makeup stick
04:24
for
04:25
six dollars the minimum I can sell it
04:27
for is 18 if I want to be profitable and
04:29
ideally I’m selling it for 24 or 30
04:31
right ideally I have a buy for one ie
04:34
buy for six and sell for four which is
04:37
buy for six sell for 24 right now that
04:41
sort of brings me to my my conversation
04:43
of premium right because you look at me
04:46
and I’m selling $28 cosmetic sticks okay
04:49
that’s my base line front end product
04:52
but my average order value is not $27
04:54
it’s 80 so how am i doing that right
04:57
I’m bundling them together and pushing
04:59
people towards a bundle and if you look
05:01
at the bundle now look at this multiple
05:03
you buy three of them 476 those three
05:06
cost me let’s say 30
05:07
so I’m now under a three multiple but
05:10
because I’m at a higher price point the
05:13
multiple can be lower because on that
05:15
seventy six I still have forty six
05:16
dollars in profit which means I can go
05:18
out there and spend forty six dollars to
05:20
acquire a sale and the cool thing about
05:21
this and we’re gonna go we’re gonna dive
05:23
further into these numbers so people
05:24
understand is if you’re able to do that
05:26
after six months you have what’s called
05:28
a repeat business so now you can go out
05:30
and spend $65 even though you’re only
05:32
making $45 because you have a bunch of
05:34
repeat business fuelling your your your
05:37
ads if that makes sense so real quick
05:39
tangent to how I got to eight figures
05:42
and then we’ll go back to this numbers
05:43
game and what I was talking to you about
05:45
gender and market and niche and things
05:47
like that quick tangent that sort of
05:50
expounds on this idea of repeat business
05:54
being a very important thing when it
05:56
comes to direct response ecommerce and
05:58
how that allows you to actually go out
05:59
and potentially buy sales at a loss but
06:02
still be profitable and grow your
06:03
business and people are thinking oh well
06:04
Ezra I don’t wanna I don’t want to go
06:06
out there and buy sales at
06:07
self-liquidating or breakeven or even at
06:09
a loss but let me let me explain to you
06:10
what happened to me which is my direct
06:14
response ecommerce business which is a
06:16
direct-to-consumer physical product
06:18
cosmetic business that I am using paid
06:20
amplification as the sole means to
06:22
promote I’m not on Amazon I’m not in
06:24
retail stores I don’t have joint venture
06:26
partners I’m not using influencers I’m
06:27
straight-up using Facebook and Google
06:29
and I’m doing 20 million in that one
06:31
brand and I’m doing 30 million overall
06:32
across other businesses as well so what
06:36
I was stuck at around 7 million dollars
06:38
a year
06:39
and look we all say what you want about
06:41
lifestyle / / business and whether
06:44
you’re working too much whatever you
06:45
want to say about that and I have very
06:47
strong viewpoints on that is at the end
06:49
of the day you’re in this game to grow
06:51
your business you want to grow your
06:52
business right or you wouldn’t be
06:53
listening to funnel hacker radio so I
06:55
was stuck at this plateau of 7 million a
06:58
year for a couple years and I could not
06:59
figure out why I couldn’t get past it
07:01
and one of the things that I’m known for
07:03
I’m like I got this name called the
07:05
growth guy in these private equity and
07:06
venture capital firms because right now
07:09
people with billions of dollars they’re
07:12
investing that money into online
07:13
commerce businesses businesses that are
07:16
built on clickfunnels businesses that
07:17
are built on Amazon businesses that are
07:18
built on Shopify that’s where big money
07:20
is going because these people with real
07:22
money see that this is the future right
07:23
so they’re looking to buy companies and
07:25
these funds these venture capital
07:28
private equity funds who might have 700
07:30
million in a fund or a billion in a fund
07:32
where they’re doing investment they’re
07:34
purchasing companies with the hopes of
07:35
growing them and flipping them or
07:36
purchasing companies with the hopes of
07:38
rolling them all up and reselling them
07:40
right so when they’re vetting deals they
07:42
will come to me and say here’s a 50
07:45
million or 100 million or 300 million or
07:47
even billion I’ve done a billion dollar
07:48
one company that is predominantly
07:52
direct-to-consumer
07:54
online based will you vet the analytics
07:58
vet the ad campaigns look at the
08:00
lifecycle customer marketing and tell us
08:02
number one would you buy this thing and
08:04
number two how would you grow it so I’m
08:06
essentially doing these growth plans for
08:08
these multi hundred million dollar
08:09
companies and what’s fascinating about
08:10
that Dave is as a person who’s owned
08:12
like I at this time when when this
08:14
started a couple years ago I was only
08:17
ever a multi-million dollar ecommerce
08:19
business owner but I’m real scrappy and
08:21
I’m real good at data analysis and you
08:23
know I came from nothing bootstrapped I
08:25
was grew up poor you know what I mean I
08:27
grew up like whatnot I came from you
08:29
know just like anyone else like like I
08:31
didn’t even realize another conversation
08:32
of going from being like identifying as
08:34
poor to now being one of the richer
08:36
people that I know and that’s been an
08:38
interesting transition of you know you
08:40
think rich people are bad but you don’t
08:41
even know you do think that it’s a
08:43
prejudice that you have that you don’t
08:44
know you have until you become rich
08:46
whole thing we could talk about that but
08:47
back to this this conversation is I’d
08:49
never grown a multi-hundred even an
08:52
eight-figure retail
08:52
now I have an eight-figure retailer but
08:54
hadn’t before and looking at their data
08:57
I noticed something across all of them I
08:59
didn’t maybe 13 of these audio audits
09:01
over two years and I’m still doing them
09:02
now which is kind of it’s fun but I
09:04
noticed I was like wow like these
09:06
companies look at marketing completely
09:08
different than the way I look at
09:09
marketing and maybe that’s why I can’t
09:11
grow and they are growing and so here’s
09:12
was the difference of how they looked at
09:14
it and this one difference in how I
09:16
looked at my business is what allowed me
09:17
to go from 7 million to 20 million in
09:19
one year boom as soon as I changed my
09:20
viewpoint on this it was literally one
09:22
fundamental shift in how I was looking
09:25
at the numbers that allowed me to triple
09:26
the business in a year and now continue
09:28
to grow so here’s what it was the way
09:30
that I looked at businesses was I was a
09:34
I got no cash I’m living off my wife’s
09:36
yoga earnings Disney I’m no joke this
09:39
needs to work
09:39
I need I need to be profitable like I
09:42
can’t mess around she’s gonna be upset
09:44
if I go bankrupt on us you know I gotta
09:46
go get another job like you know I’m 22
09:49
this ain’t working you know I’m not 22
09:50
now but so the way I looked at it was if
09:53
an ad campaign is running and it’s not
09:56
profitable you turn that thing off
09:58
immediately right you look at Google
10:00
AdWords and you got six keywords in
10:02
there this is old school and two of
10:03
those keywords don’t work turn them off
10:04
you’re running Facebook it’s not
10:06
profitable turn it off now here’s what I
10:09
noticed about all these retailers is
10:10
they all had one channel that I call the
10:14
subsidy channel that was subsidizing the
10:16
rest of their marketing so it was either
10:17
email or organic traffic or Google
10:22
Adwords those were the top three it was
10:23
either email organic traffic or Google
10:25
Adwords and then Facebook would be at
10:27
the fourth one or maybe Amazon it was
10:29
one of those channels it was one of
10:30
those five channels where that one
10:32
channel of visibility was uber
10:34
profitable just crushing right and as
10:38
you go in business year-over-year and
10:41
this is the what I call the halo effect
10:43
people don’t understand this this is why
10:44
smart marketers growing Zipporah is
10:46
growing boom is grunts I have this halo
10:48
effect of I’ve been in business three
10:49
years I have all these past customers
10:51
who are repeating who are coming back
10:53
organically who are coming back through
10:54
emails that gives me a baseline of
10:55
profit that I can spend on amplification
10:57
to grow my business if that makes sense
10:59
so what they were doing was they take
11:00
their email revenue and then they go out
11:02
to Facebook they go out to Pinterest
11:03
they go out to Instagram they go out to
11:05
YouTube and they
11:06
lose major money buying customers right
11:08
they lose money on all these other
11:10
channels but all these channels are
11:12
being subsidized by one profitable
11:13
channel they’re out there losing money
11:15
but they’re acquiring customers and then
11:17
come the holiday time or come their next
11:19
sale they have a much bigger pool of
11:21
people to run that sale event to and
11:23
they end up making way more money during
11:26
that sale event because they have such a
11:27
bigger pool because they were out there
11:28
growing that pool over time even at a
11:30
loss and man up with a much bigger
11:33
company so they take a longer trajectory
11:35
they’re like listen we’ve got one
11:37
channel that makes a hundred grand a
11:38
month in profit let’s spend ninety five
11:40
thousand dollars that hundred grand a
11:41
month in acquiring customers at whatever
11:43
cost as smartly as we can as effectively
11:46
as we can you know some of them will be
11:48
breakeven some will be at a loss but
11:49
let’s go out there and use that money
11:50
that we have baseline to grow because
11:53
just growing the operation over time
11:56
grows the operation if that makes sense
11:57
it’s not you with me I went from seven
12:01
to eight figures is changing my
12:02
viewpoint on that instead of turning off
12:03
ad campaigns that didn’t perform I
12:05
looked at my ones that my organic
12:07
traffic my email traffic in the ad
12:08
campaigns that were performing as a
12:10
subsidy to support the growth on
12:12
channels that weren’t performing which
12:13
allowed me the freedom and flexibility
12:15
to figure out how to get those channels
12:17
to perform that’s the thing that you
12:18
don’t understand is that most people
12:19
understand is that like you need some
12:21
level of resource to figure out how to
12:22
get a channel to work and if you’re not
12:23
investing in it you’re never gonna
12:25
figure it out and so it all kind of
12:26
works together and this is why
12:28
businesses that I’ve been around three
12:29
or four years have such a such a like
12:34
sort of market preference like they have
12:37
a what’s the word advantage over
12:39
businesses that have been around because
12:40
they have some form of Halo that they
12:41
can invest in direct amplification and
12:43
the big issue with business owners Dave
12:45
that I see in our industry is they pull
12:47
all their money out of their business
12:48
they don’t reinvest in the snowball
12:49
they’re afraid to lose money on paid
12:51
amplification because they think they’re
12:52
losing money they don’t understand that
12:54
they’re actually investing in the growth
12:55
of the snowball that 18 months from now
12:57
is gonna be a giant snowball right so
12:59
it’s it’s a fundamental shift in how you
13:00
look at growing your company from a paid
13:03
amplification perspective and if you
13:04
have one channel and a lot of people in
13:06
my industry have Amazon that’s real
13:08
profitable for them and I advocate for
13:11
using that profit to go out and buy
13:13
sales via direct response even if you’re
13:15
losing money because overall you’re
13:17
going to grow the calm
13:18
and it’s kind of just a different way of
13:19
looking at it and ultimately now we’re
13:22
way more profitable than we ever were
13:23
and we’re way bigger but it’s because we
13:25
changed our viewpoint on how we look at
13:28
ads and numbers I think that’s the part
13:31
you know most lumps when we first got
13:33
started with leuh used to pay the bills
13:35
and it was man I’ve got a lifestyle here
13:36
I’m second all the cash out of it and
13:38
you’re like I get it
13:39
you’re sitting there freezing I think
13:41
you know you got to build your business
13:42
for winter and that is your a situation
13:44
where things aren’t always gonna be as
13:46
great as they are right now but if
13:47
everything cycles and I think especially
13:49
in the econ platform if you can be taken
13:52
that and really investing and I think
13:54
what I loved about what you’re saying
13:55
their answer is learn use that to learn
13:58
these other platforms because every
13:59
single platform is so totally unique and
14:01
different
14:02
I think it’s just I love the term as far
14:05
as paid amplification that’s super super
14:08
like and you guys do that really well at
14:09
clickfunnels I mean I see your videos
14:11
all the time on every channel you know
14:13
you’re on you’re on Instagram you’re on
14:14
Instagram stories you’re on YouTube
14:16
you’re on Facebook I mean you guys
14:17
really get paid amplification of
14:18
story-based content that engages the
14:20
consumer over time that when you have a
14:22
sales cycle like you got a new book
14:24
coming out or you got a new whatever
14:26
coming out like all these people that
14:27
are in your community have been seeing
14:30
you over the course of the last couple
14:32
months because you’re adding value
14:33
through content which is my second
14:34
strategy which is once you have a
14:36
community you take 10 percent or 20
14:38
percent of your total ad budget and you
14:40
invest it in literally just amplifying
14:42
value add content to that community and
14:43
we started doing this we started seeing
14:45
our sale campaigns that we run every
14:46
month and a half go up by about 500
14:49
percent because all these people were
14:50
now engaged with us on a weekly basis
14:53
seeing content that was just value add
14:55
content not designed to sell anything
14:56
that when we did decide to sell
14:58
something worked way better because they
15:00
were engaged with us now back to the

Expert Secrets: Find Your Message, Build A Tribe, And Change The World…

:arrow_right: Get FREE Book Now! (Limited Copies)

“Expert Secrets Is The Map That Will Allow You To Turn Your Specialized Knowledge, Talents and Abilities Into A Business That Will Work For You! This Is One Of The Shortcuts of The New Rich” - Robert Kiyosaki