Most entrepreneurs don’t love history or math, but when they understand this principle, it’ll make it really, really fun.
On this episode Russell talks about knowing the history and math of your industry to be able to grow your business. Here are some awesome things he discusses in today’s episode:
So listen here to find out why if you know the history and math of your industry, you are more likely to have success within it.
---Transcript---
Good morning everybody, this is Russell Brunson. I want to welcome you to the Marketing Secrets podcast. Today we’re going to be talking about marketing history and marketing math.
Hey everyone, welcome back to today. I hope you guys are half as excited for the week as me. Monday here, and the sun is shining, fun stuff is happening and I cannot wait. This morning as I was studying, I was listening to Mr. Dan Kennedy, still one of my favorite people to study in this marketing world. And that was kind of fun, I was listening for the last 48 hours or so, and last night I listened to one of his courses, and in the middle of the course he starts talking about me.
I was like, how cool that Dan Kennedy is talking about me at one of his events, his seminars. So anyway, that made my whole night and got me more excited to listen to him. And this morning he started talking about what his criteria to do a deal with somebody, to be in business with them or to work with them. There was a couple of fascinating things.
One of them, obviously, was can you find three other people who have done at least one deal with that person, that would do a second deal? And I think that was a good one, he’s talking about, if someone’s been divorced once or twice, maybe there’s a reason, but if they’ve been divorced 9 times, there’s probably something wrong. It’s probably them, it’s probably not the other person at that point. It was kind of funny when he was talking about that.
But then he talked about three criteria, so I will walk through those. So the number one criteria, he doesn’t want, he would never work with somebody who was entitled. When he was talking about entitlement, he was talking about, if you guys watch shark tank, he said he started tracking this over the last two or three years. In shark tank, they always have the little video before the person comes and presents their package or their product kind of telling about their business. And he said the entitlement is when they’re like, “We spent our whole life savings, I quit my job, I did all this stuff. I have to get a deal, the sharks have to give me money.”
Where it’s out of a point of desperation or entitlement, “Because I sacrificed everything, I should get this thing.” He said, if you look at Shark Tank, the 48 people that he counted since he started counting, that their little package before their pitch happened, only 4 of those 48 ever got a deal, whereas the average, when you look at Shark Tank as a whole, 1 out of 3 get a deal.
So coming at something where you think you should be successful because you worked hard or because you put forth the time, is not a good reason. It has nothing to do with it. That’s the entitlement of “I should be successful, I’ve been killing myself on this. I’ve been studying, I’ve been reading, I’ve been learning.” And it’s like, that does not entitle you to success. That’s not the right thing. So that was number one.
Number two, he said that you have understand intimately the history of the industry that you’re going in. For example if you were going to go and you wanted to be in the personal development success space, if the only thing you know about personal development going back was Think and Grow Rich, and that was as far back in the history of your industry you’ve gone, he would never do a deal with you. There’s so much stuff that happened pre- think and grow rich. There’s so many people and stuff that happened, that if you haven’t studied back that far in history, he would not actually work with you.
That’s actually one that I would completely agree with. It blows my mind to have people come into an industry. I had someone who joined one of our coaching program, wanted to be a real estate guru. I was like, “cool.” And I’m not a real estate guru, but I happen to do my homework in every market that I’m in or that I’m interested in and I know who a lot of the real estate guru’s are.
I asked this person, “Do you know so and so, and so and so, and so and so?” and they’re like, “Never heard of them.” I was like, “You are doomed then. If you don’t know the history of your market, how are you supposed to come in and compete in that market? You don’t know what other people’s offers have been throughout time, you don’t know what’s worked and hasn’t worked. You don’t know these things, you are going to struggle. You have to know the history of the industry that you are going in.”
It kind of leads back to my point today. I spent the last two days binging out on Dan Kennedy, who for all intents and purposes he’s the history of this industry. I go back further than that. I study Robert Collier, I study I’m going to blank out now on the top of my head. But I study all the old time marketing sales books, Gary Halbert, even prior to that. I study that, geek out, nerd out, all those kind of things. If you look at my library here you would never, you would look at it and be like, “I’ve never heard of any of these books Russell.” I’m like, “I know, these are the history books of my industry.”
There’s a reason why I’m successful. I studied direct mail, I studied clear back to the pony express, when people were delivering stuff by horse. I know this market inside and out, and that’s why I’m able to compete in it, because I know the history of it. While history in school is useless, the history in your marketplace is essential.
So if you don’t know your market, now is the time to start geeking out and figuring out the history. For me, I spent 400 or 500 bucks a month on eBay buying old marketing and sales books. Go to your industry and go search on eBay for old stuff that’s been published in the past and buy it and read it and study and learn it because if you understand the history of where you are at, you’ll be more successful in the future where you’re trying to go.
So study the history of your market. And then number three is understanding the math of your business. So really, it was kind of interesting. Don’t be entitled, have a deep understanding of the history of your industry, and then understand the math of your business. And the math is the numbers right.
How much does it cost to acquire a customer? How much do you make from your customers on average? How much is your average cart value? What’s your average stick rate? All those kinds of things are vitally, vitally important. And if you don’t know the math, you’re in trouble as well. If you go watch Shark Tank, you’ll notice the one question that all the sharks always ask is, “How much does it cost to acquire a customer?” and half the time the people blankly stare over and they’re like, “I don’t know. I don’t know the answer to that.” They have no idea. How are you supposed to compete if you don’t know that? You need to come in and know this is about what it costs for me to acquire a customer.
When you know that, then you can work on a funnel that’s going to give you more than it costs to acquire a customer, so that you can be profitable or break even, and now you’ve acquired customers and you can go and sell them other things in the future. That’s how we grow and scale companies.
So anyway, I thought that was interesting today, because most of us internet nerds and entrepreneurs are obsessed with history or math, but history or math in the confines of what we’re talking about is actually really, really exciting. My grandpa was a history professor at Brigham Young University, he’s written like ten books on history. Man, I love him and I go talk to him and ask him questions about history and he tells me and my eyes glaze over. I’m not interested in history. I love Christopher Columbus, grateful he came here, but I don’t really care about all that stuff.
But if you think about history typically, I’m like I don’t want to do that. But history of my market, I’m obsessed with it. I love it. I love finding out about the old school guys who are licking stamps and gluing them on envelopes and shipping them out. What did they know, what did they understand that I didn’t understand? What are the things I could learn from them that I can then come back and apply in my market?
And if you look at, it’s interesting, the ninja secret stuff that I come out with and people are like, “Whoa, Russell how did you think of that?” I’m like, “Oh because Okelvy did it?” “Who’s Okelvy?” “Some dude who’s been dead for a long, long, long time.” I study the greats, I understand where this market came from and because of that, I’m able to compete in a different level in this market because I know the history.
It’s interesting, I even, not the long history, I look at 15 years ago, the things that I was doing to grow a list and build a company, I’m bringing a lot of those things back and it’s interesting because those were the, because I know the history I’m able to bring these things back that are the dead lost arts.
I talked about this before, selling from stage is a perfect webinar. I don’t think I’m the best stage presenter in the world, but I do think that it’s a dead art. I think that when I got started in this business, there were some amazing stage presenters who were a million times better than me. So I studied and learned the art of it, studied history and then when these guys all retired, there was no one else doing it, and I came back and started doing it with the stuff I learned from back in the day, and the history lesson gave me the ability where I was able to stand on stage two months ago and do $3 million in 90 minutes, which is a world record.
So imagine if one of the greats came and did that, they would have crushed me. But I understand history and therefore I’m able to use it in the present. And then the math, I hate math more than anyone. I hate excel, all those kind of things, but I do know the numbers that drive my company. We have a big TV screen in our office when you walk in that I can look at and see the numbers and the metrics, and I have this weird thing that I know. So when you look at numbers, what you track grows, so I look at it, I see it, then I can figure out how to grow it. It’s a magical amazing thing.
In fact, today I woke up this morning a little heavier than I like to be, so I downloaded my Fit Pal or whatever that app is and I told Melanie, and told my wife this week, that any food that crosses my lips has to go in my fit pal so I can track it and see what I’m actually eating. Because the sooner you’re aware of what you’re actually putting in your mouth and what that actually equals out in calories, then you’re like, “Oh crap, I should eat differently or change some things.”
It’s like, this morning, I did my supplements. And usually I think supplements are zero calories, because it’s just like supplements, but I actually put them all in there and it was like 200 calories in supplements. I was like, oh crap I just put in 200 calories I was accounting for, maybe that’s the thing that’s putting me over the edge right now, on top of all the other stuff I’m eating.
So you gotta know the numbers, even if you don’t love math, find someone who loves math to give you the core numbers that drive your company and your business and then look at them, and just by looking at them, they’ll grow. It’s this weird thing. When I’d start tracking my list, I’d look at that number and it would grow, because your brain starts trying to figure out ways to make it bigger. And it’s weird, you look at that number and your body, your brain, your mind will automatically find the answers to it. It’s kind of cool how that works.
So there you go guys. First off, you’re not entitled to nothing. Number two, master the history, understand the history of your industry. And number three, learn the math of your business. Now you got history, math and now you can actually have a business. Know your numbers, know your business. No numbers, no business. You probably can’t see me spelling it out, but know your numbers, know your business. No numbers, no business. Someone told me that one time. I don’t remember who, but it was amazing.
So know your numbers, know your business. If you have no numbers, then you have no business. So that’s why the math’s important as well. Alright guys, with that said, I appreciate you all, have an amazing day. Go dominate the world, go find some history of the market you are in, understand it, study it, learn it, it’s part of your homework assignment for this week. Appreciate you all and we’ll talk to you soon. Bye everybody.