What's up, guys? Welcome to another episode of the Business Secrets Podcast. I'm going to start calling this the podcast in the judo parking lot because I've been, I think, three, four weeks in a row now of being consistent with dropping Joey off of judo and recording a podcast in here. So I'm enjoying it. A lot of cool stuff happening at the time of record recording this. I am prep in deep prep mode for the SPF mastermind meeting that is coming from around the world. Over a hundred gym owners coming from around the world to my gym in New Jersey. We do two in New Jersey and then one in Orlando, but this is the second one in New Jersey. And I've got a lot of great stuff planned. The event theme is all about transitioning from operator to owner. There is a lot of gym owners that are stuck working in their business. And you've heard the favorite very famous Michael Gerber line of a you really need to start working more on your business versus in your business. I believe that's true. There's a lot of stuff about the e-myth that I used to believe that don't believe anymore. I do think the premise is really good and is one of the most valuable business books. So I still recommend it. But there's definitely some things in there that I think mislead people down the path. But for whatever reason, I think that shifting from operator to owner is an important thing to do. Because if you never do, you're always gonna kinda be chained to the gym. And you started the gym and you took on all the risk and all the pressure and all the stress to have something in return. And y yeah, money is good on a it's fine, but I don't know, but freedom's pretty good too. And I do think there's a lot of people that I think there's a lot of people that don't have money or freedom, but there's a decent chunk of people that are chained to the business and making money, but have no freedom. And ideally you want both, right? You want your financial situation to be really solid and sound, but you also want to have some freedom. And I see a lot of business owners that are doing well, and there's a a salon I know of where the guy's been working there for 40 years and he's in the chair, and he's still in the chair, and he's still cutting hair, still doing the same thing. Now he's probably made a lot of money and done really well, but he's been chained to the chair and for a really long time. And my wonder is if he wasn't chained to the chair, what are all the other opportunities that he could be doing? So if you take me, for example, right, if I was chained to my gym and I structured my life around being at GFP all the time, being there every day, and I never did or thought of anything else except going to GFP and working at GFP, I wouldn't be recording this podcast, I wouldn't have written any books, I wouldn't have started a marketing agency, I wouldn't have launched a license. There's a lot of other things I wouldn't have done. It wouldn't have launched this business that I'm in, this consulting business. There's a lot of other things I wouldn't have done. And so that's whatever, but there's a lot of people doing it, and the theme of the meeting is all about that transition. And that transition is hard. It's not an easy thing to do. There's skills that you have to learn that you necessarily don't have. And there's a mindset stuff that comes with it. There is a lot of mindset stuff. There's a taught there's the I often say growth and control work inversely, right? And if you want to grow and you want more growth, you're gonna have to give up some control. And I think one of the reasons why people stay the operator is because it makes them have this feeling of control. But that tends to stymie growth, right? Yeah, it's uh it's a really it's in it's a really important topic. And uh I when I see a testimonial from a gym owner, I'm I'm happy about the growth and revenue, but I'm most happy about the time that they're spending with their families and things like that. So it's gonna be a great event. Super excited for it. I probably by the time you're listening to this, it might be over. But today I want to talk to you about one of my favorite books is, and I rarely do this, but I'm gonna do it because it was such a good chapter. So my favorite book on the planet is The Road Less Stupid by Keith Cunningham. It's it's the book that I have most highlighted, underlined, dog-eared. It's like my if you look at my book, it looks like it's a hundred years old. It's just phenomenal. And I was reading through one of the because some of the stuff I'm doing on systems development, he has some really good stuff on systems development. So I was brushing up on the book, and I came across this chapter that's been un more of a forgotten chapter, I think, in the book. I haven't read it. I've only read it a couple times. I've read the book like 10 times, but I've only read this chapter a couple times, but this just makes a lot of sense. And he goes over a growth funnel with how to grow your business and what are the eight ways to grow your business. And I've talked a lot about the Jay Abraham line of there's three ways to grow a business model, and that is get more customers, increase the transaction size, and then increase the frequency of transactions. That's the Jay Abraham's. This is like a little bit more of a robust view of increasing revenue. Now, some of the stuff is it all definitely contributes to increasing revenue, but it's not something that like necessarily will stimulate revenue in this immediate hit, if you will. It's just things to do and things to think about for your business. But it's a really good, I think this is gonna be a really good outline for what are the things that you need to be focused on? What are the areas of your business that are the most important to be able to grow revenue? And I had a business mentor, I was in an off-site meeting, and we were having this argument over different goals that we were gonna set, and he wanted me to set five goals, I wanted to set ten goals. And he looks at me and goes, Vince, when everything is important, nothing is. And so these things I'm gonna outline with you, and again, I'm straight from the book, right? I got the book in front of me going out and using it as an outline, and then giving my experience in color on each of these items. But I rare- I rarely do stuff like this. Most of the stuff that I teach you guys is straight from the trenches, it's stuff that I'm doing at my gym, it's stuff I'm seeing with my clients and stuff I have experience with. So I try not to tend to do too much of what I'm about to do, but I do promise to make sure that the insights that I give on each of the items is helpful. So it's basically it goes in a growth funnel, how a funnel starts. There's the top of the funnel that's big. And typically, what is when we hear about a funnel, a marketing funnel, what do you think about our leads? It starts with leads. And actually, leads are the bottom part of this funnel, they're the smallest one, and I'll talk about that when I get to the end there. So the widest part of the funnel, he calls it, is keep more customers. And I'm in a hundred percent agreement of this. I think that, and again, I'm a marketer at heart, I love marketing, but in the gym space where we have the ability to have recurring revenue, where when we get a customer, we can either keep that customer for twelve months, or we can keep that customer for 36 months, for 50 months, for a hundred months. You just think about the value difference between a gym that can keep customers for the really the long haul, it is game changer. Complete game changer if you can really do that really well. And man, if there's if you were to highlight one area of your business to have your finger on the pulse of, to have make sure it's going well, to make sure it's not getting out of hand, it is 100% your attrition rate or your retention rate, whatever you want, whatever angle you want to go. It is 100%. It is the lifeblood of the business. And it's funny, I've been doing a lot of I've been doing listening to this podcast called the Founders Podcast, and I really like this guy. And he they were talking about all the different big time CEOs, like the guy from Walmart and the guy from Home Depot, and they were obsessed, they became obsessed with the customer experience, and to the point where the CEO would be going and flying in their private jet to go to Walmart in Tulsa, Oklahoma, and to go there and talk to customers and be there when customers come in and talk to them. And it was just like it's so funny because I think the, and I'm guilty of this too. Like we get so far outside of the result, right? We want to not train anyone anymore, but we forget about that the training of the people is the business. Now, it doesn't mean we have to do that, but it does mean we need to keep our finger on the pulse of that and make sure it's good. And I have made this mistake myself. I have had periods of time where our attrition got a little bit out of control because I totally lost touch with the actual product that we were delivering, the people that were delivering it. And if you're owning your business, like this is the number one driver in your growth funnel, is that you have a really good attrition rate. And no, you're not going to keep everybody. You're just not. But at the end of the day, you should be focusing on shoot, definitely below five and really getting into that two to three area, that two to three percent attrition very quickly for you at home. If you have a hundred clients and you lose two people a month, you got a two percent attrition rate. You're doing good. Okay. But if you're creeping up to be five and six and seven percent, like that is a business that's going to struggle because most people do not have the marketing talent nor the budget to be able to outpace a really bad attrition rate. And so you've got to understand that, you've got to know that this is such a key piece to your business. You cannot lose sight of that. Do not become a marketer. You want to be good at marketing, but do not become a marketer in spite of developing a business that has a good product that people want to stay. I can't stress that enough. So that was number one. And you gave this formula too. I don't know if he got where he got this formula, but he basically gave his formula for keeping customers. And I learned this exact formula from Ari Weinswick, one of my mentors, and I don't know if Keith got it from Ari or Ari got it from Keith. I don't know. But here's the formula. Step one is find out what the customer wants. Okay. Step two is get it for them. And step three is give it to them. So that's the three things. Get go and get it, find out what they want, go get it, and then give it to them. Now, obviously, it's easier to do in a restaurant. Like if you don't find out what they want, I want meatloaf and then go and get it and then give it to them. It's easier to do, but if you think about this, it's does that change your intake process? Are you asking your customers what they want when they start with you? Are you doing now? It's a little different in this situation where we can't just go get it, like they have to do the work. Let's say they want to lose 20 pounds. We can't go and get it. But we have to go and get the strategy and the plan that's going to help them get from their current situation to their desired situation. But if you never figure out what their desired situation is, then it's going to be hard for them to actually get it, and it's going to be hard for you to develop the plan to get it. But that that that's this three-step customer service rule. It's a little more of a product-centric rule. And in our world, it's it it does take them to do the work. But at the end of the day, we can only focus on our part, like we can only focus on what we do. And you can't hang your hat on outcomes for people. You can only hang your hat on the things that you do. And I'm going to give you an example in number three about how to define and enhance the certainty of success, because I think this is a really good piece of it. Let's go to number two. Number two is increase referrals and repeats. And so repeats would be we're not so much of a repeat business because most of our business is recurring revenue. Now, an example of a repeat would be like if you have to do one-on-one and you do packages, right? Every time they renew the package, that's like a repeat customer. But so that's that would be that. But and then increase referrals. Now, I have this kind of thing that I like to focus around as a good measure of is your business doing well with referrals? And I learned it from Dean Jackson. And he basically says you want a 20% yield annually on your customer base for referrals. And so what that means is if you have a hundred customers, you should be getting 20 referrals per year from those 100 customers, right? So 20 of those 100 are sending you a referral, and then it repeats after each year. And so that's like my what I teach my guys to know how they're doing with referrals. But with referrals, you've got to understand is that there's two kinds of referrals, right? There are referrals that you get by accident, right? The stars align. Someone bumps into one of their friends, their friend goes to their website, you they opt in through your website, you magically call them back, they come in for a consult, then they sign up for a membership. When you think about how rare that is, and how that is like the stars have to align for you to get a referral. Yes, it's great when it happens, but if referrals are so great, then what we want to do is we want to have processes that orchestrate referrals. We want to run our business in a way that generates referrals. There's one way is do a damn good job. And if you do a damn good job, you're probably gonna get more of those accidental referrals. Alright, so that's a given. We got to do a damn good job. But part two, after you do the damn good job, is to create systems around getting referrals. And so an example would be do you have a bring a friend week every quarter? And if you have a bring-a-friend week and you do that every quarter and you follow specific systems and processes, there's a really good chance you're going to increase the amount of referrals that you actually get. All right. So at the end of the day, growth comes down to two things, keeping the customers your gout and getting new ones. And we can get better new ones through getting better at referral systems. And I have a whole thing that I teach on how to develop a referral machine, a concept I learned from the great Dan Kennedy. But a question that he actually adds in a book, I think this is a great question. I've used this before. I've gotten this quite I've read this question in this book, but I've heard this question other definitely other places. And the question is, how would you run your business if 100% of your future growth was by referral and repeat business only? So you couldn't go out and generate new leads, you couldn't go out in into the community or anything like that. You could only go by your referrals, the current customers that you got, and them sending their friends and telling their friends about you. Man, what do you think you'd do differently? Would you be doubling down on the product and doubling down on the staff training and doubling down on investing and researching the best ways that they can get success and all that? It's it would change the game. And so it's a great exercise and a great question to sit with. So that is number two is increase referrals and repeat business. Number three, and this is an interesting one, and something I don't talk about often, and it's really it's been a really good reminder, but it's define and enhance the certainty of success. And he's talking about the certainty of success with your customers. Basically, what has that what has to happen to give your customers certainty of success, right? And you think about it, if uh people come to your business and they get what they want, they're going to be raving fans, they're going to be happier customers, they're going to talk about you more. And there are ways that we can run our business that help enhance the certainty of success. Here's uh I'll give you one of them. I believe that having regular checkpoints with your members is a really powerful thing to do. And so let's just say that it's not a monthly meeting, but it's like a quarterly meeting, right? And instead of like you having meeting someone once and then you know putting them in your system and then going you know about their way, instead of that, you put up a system in place that meets with them quarterly and you have a process around that meeting. And maybe in that meeting you're redoing their goals or you're redoing their nutrition program or something like that. That is an example of something that will enhance their certainty of success. If there's a regular meeting pulse, if there's regular checkpoints, if there's regular troubleshooting, if there's re-evaluation of a plan, there's a really good chance that if that happens, that people are gonna have more success. And then we have more success. Man, there's a really good chance that if someone gets approached by a friend to go do bring a friend day at another gym and they ask your client, and they're like, What are you crazy? You crazy? I'm not gonna go do another gym. Like the gym I have is amazing. They give me exactly what I want. They have good people there, I've gotten results and all of that. So, what are the things that you can do to enhance the certainty of success with your members? Now, I will say the first thing about that is defining success. Defining success. Your customers get to define the success, not you. It's not about your success, it's about their success. If their success is coming three days a week, that's their success. If their success is losing 20 pounds, that's their success. Your job is not to define their success. Your job is to help them pull help pull it out of them, and then help develop the plan that's gonna help them get it. That's your job. And yeah, I see a lot of people that get and I used to do this too. I used to get all frustrated if someone didn't get their results and someone like I got all mad they didn't get it. But it's not that's not my job is to get their results. It's their job to do it. It's my job is to give them the coaching and the guidance and the plan development and all of that. And the rest has got to take care of itself. Okay, that was number three, define define and enhanced certainty of success. Number four is enhance and train the sales process. And I think what he's talking about here is if you have salespeople, and again, a lot I know a lot of you listening don't have salespeople, but I think his point here is basically that the sales process is so important. Like when a customer calls you for the first time or they come sit down with a consult, like that is that's a critical event in your business to make more money, right? And his point is about getting better at sales. That's what he's talking about. He's talking about the training that you need to do and the not just the training that you do, but the training around having a system, right? The formula for how you get success. I talked about this a few podcasts ago when you have to have some semblance of a process when you go into a sales meeting. Like if you're getting on a call and trying to book an appointment or you're sitting knee to knee in an office with them, you can't be winging it and doing something different every time. There should be a process that you follow. No, you don't need like a script to read word for word. You don't need that, you shouldn't have that. But man, should you have a series of questions that you ask people every time that you get on the phone with somebody to try and book an appointment? Absolutely. And he so he's talking about enhancing that process, like getting the people that are doing the sales that they're training to get better, and then the process that you are using, you're constantly evaluating that and finding what's working and changing and tweaking what's not working. But the biggest thing to take from this is what are the things that you need to do to make your sales process better? And then how can you train the people, even if that's you? Like when was the last time you listening to this? When was the last time you took a sales training course? When was the last time you tried to get better at closing membership people into memberships? Very few people do that, right? And so it's an important piece, important part of the business. So it's something you should work to get good at. Number five is the increased conversion percentage. So now we're staying on the sales piece of it, and this is about the conversion percentages. And I really look at two percentages for your conversions, right? The first conversion percentage is your conversion from lead to consultation or free trial or whatever you want to do. Basically, that first hit that they get. And then the second conversion is their conversion from the consultation to a new member, right? Or the free trial to a new member. That's the two conversions. And typically what I see is anywhere from what's good is anywhere from a 20 to 30% conversion rate on lead to consultation. I'm just going to use that term for now. And then a 70 to 80% conversion rate from consultation to new member. If you can hit those numbers, but his point is that a 5% conversion rate, if you go from 25% conversion rate to 30% conversion rate, you are going to drastically increase the amount of people that you close over time, and you're going to decrease the amount of leads, right? It's basically, it says it right here, if you're currently closing 25% of your leads, a 5% increase in your close ratio is equivalent to an increase in your leads by 20%. Right? So you don't need as many leads. If you want if you increase the conversion rates in your sales process, you need less leads. It's like free leads. You're gonna make you're gonna make more money with less leads. It's amazing. Right? And so you gotta look at that these conversions. The first thing you need to do is be measuring this. And I typically will measure this on about a monthly basis, right? I don't think you need to do this weekly, but you should be looking at the conversion percentages. And it's really simple. It's just look at it like this. Like, all right, how many leads did I get? 100 in the month. If uh we're I'm recording this in November. Just look back to October. How many leads did you get? Alright, I got 100 leads. How many people sat in your consult room? Twenty. Or you got a twenty percent conversion rate, right? That's basically what happened. All right. Or you had 20 consultations, right? How many of those became new members? 10 of them. All right, so you get a 50% conversion rate, right? And so you got to look at these conversion rates from a monthly basis, and then you gotta kind of see what is good. You use my numbers that I gave you before, and if you're on track there, great, keep going. But if you're well behind, that's an area for you to pick that up, right? You want to pick up that part of your business. So if you're at a 10% conversion rate right now from lead to console, you gotta pick it up. You gotta get that 10 and get it to 20. And now you need to either train the person, you need to increase the uh the the training on the process that you're using. Whatever you need to do, that's the area of your business that needs to be improved. Okay, that's number five. Number six is increase the transaction size. And this is a big one that Jay Abraham talks about, increase the size of the transaction. Now, I have talked about this to you guys ad nauseum, but the number one way to increase the transaction size is to alter the price, right? So if you want, if you have a hundred customers paying you 200 bucks a month and you move everyone to 250, you are going to drastically improve the financial health of your business. So that that is the number one hack of increasing transaction size. Another way to do it is to think about is there a higher priced option that you could create? So if your highest package right now is 500 bucks a month, do you have something that you could sell for$1,500 a month, right? So just a larger package or something like that. So that's the sixth one is increase the transactions. I talked so much about this from a price standpoint for with you guys. I'm not going to go beat this up, plus this podcast is already getting pretty long. But that was number six, is increase the size of the transactions. And you're going to do that most likely by enhancing the price. Number seven is increase the frequency of transactions, right? And so this is going to be about taking your current customers and selling them more stuff. So here's where I and I'm never going to say I disagree with Keith Cunningham because he's a genius and I'm an idiot compared to him, but I do believe that this is only for businesses that have a certain number of customers, right? And so if you're going to focus on increasing the frequency by selling your customers more things, and you only have 20 members, only a certain percentage of members are going to buy other stuff, right? It's not a good use of your time to try and get three people to buy supplements. So I do believe this is right. Like I have gyms that have 500 members, and it's all of a sudden they just added supplements or they added other programs or they added other things, they would massively increase the revenue. And that's one of the beauties of having a lot of people, right? The tough part about having a lot of people is the churn rate's high. Not the rate high, but the number that you're losing. So if you have a thousand members and you have a 5% attrition rate, that's a crap ton of people that you're losing every month, right? So you got to take the good with the bad. But this is about increasing the frequency, getting your customers to buy more stuff, right? And if you're already getting them on a monthly membership, they're paying that monthly membership. There's a really good chance and likelihood that if you put out other things for them to buy, if you had stretching services, if you had massage, if you had supplements, if you had nutrition coaching type things, there's a good chance that they're going to buy that stuff. So that's number seven is increasing the frequency of buying. Number seven, sorry, number eight, this last one, is increased leads and traffic. Now he has this last, I think, to try to make a point. And I think what he's talking about is probably digital leads and Facebook and stuff like that to try to get high volume leads. He's probably not talking about building relationships in the community, which I think you could almost put that, like joint ventures and stuff like that, where you're take making relationships with people in your community. You could probably put that into number two, where increasing referrals in there. So I think he's talking about choice, and this is important, right? You want to have a good website, you want to have leads while you sleep, as I talked about in a podcast when I did with GR and stuff like that. But his point here and why he put it last is he wants you to you to optimize before you maximize. That's the line that he uses right here. And shoot, if we're spending all of our time on driving more traffic and getting more leads, and we're losing everyone out the back because we have a shitty retention system where we put crappy trainers on the floor, all that increase of leads and traffic is gonna do nothing. And so they I think that's his point of putting it last, is to really make sure that you're doing the important things first. All right, and so that's I guess why he's doing it. So that's it. That's the I get it. I tried to do it in under 30 minutes. I'm a little over right now. But yeah, that was I I don't know. I just love that chapter. It's the chapter is called Prioritizing Growth Strategies. The book is The Road List. Dupe it's my favorite business book on the planet. Again, I've read it a million times, and it's just some really good stuff in there. And I was happy to do this one of not only just reading you what he said, but also putting my experience in connecting that with it. I thought that was hopefully it was helpful for you guys. So I'm gonna go in and watch Joey do some judo now. And uh hopefully that you're if you're a gym owner and you're listening to this and you want to get the inside scoop and get some of this stuff on a regular basis by coming to some of the SPF mastermind meetings, definitely shoot me an email or reach out to me, vintagecaprielf.com. And I really appreciate you listening. We have this is ranked the number one. One fitness business podcast in the world. Until a next one comes out, we are number one. And I'm going to keep saying it. And that's not that's only because people, good people like you, keep listening and taking action on the stuff that we're teaching here. So appreciate it. Again, even though we're number one, it always super always is very helpful if you and subscribe. So if you could follow the show. Sorry, not and subscribe. That's YouTube, right? If you could follow the show and then leave us a comment. Like the I it's pathetic. The last comment or not review we got for this podcast was like a year ago by a guy named Plyo Freak. And so you gotta I keep seeing Plow Freak all the time. Just come on. Give us a review for the podcast so I can get Plyo Freak out of there. But thank you, Plow Freak, if you're a listener, I appreciate it. But anyway, so hopefully this was helpful. He's a genius, and I'm honored to be able to just read this stuff to you and do some really, really good stuff for you guys to take home, and maybe you can listen to this one again and take notes on it. I think it was probably a noteworthy one from there. But appreciate you. Talk to you later.