The product that stopped opening doors
A course business can still have valuable knowledge and lose the market for its courses. Ryan Deiss, founder of DigitalMarketer and an entrepreneur who says his portfolio generates about $200 million annually, describes precisely that problem. After producing marketing courses for 25 years, he is stepping away from making them while the company changes direction.
The distinction matters. This is not a declaration that marketing knowledge has become worthless. It is an admission that selling that knowledge in a familiar package no longer produces familiar results.
In conversation with Chris Do, Deiss supplies a number that makes the decision harder to dismiss as promotional theater: DigitalMarketer's course business, he says, had fallen to about 20 percent of its level two years earlier. Not down 20 percent. Down roughly 80 percent.
Those are his reported company figures, not evidence that the entire education market has contracted by the same amount. But inside his business, they describe something more serious than an underperforming launch.
Courses and certifications had accounted for about 40 percent of revenue, alongside memberships, subscriptions, licensing, and corporate work. More importantly, they introduced customers to everything else. The threatened product line was also the customer acquisition mechanism.
A declining entry product can endanger the entire business.
The subscriptions did not disappear overnight. That was part of the danger: existing revenue could make the company look healthier than its incoming customer flow suggested. As members left, fewer new buyers would be available to replace them.
Deiss describes the warning signs as a sequence, not a single disaster. Sales softened around the middle of the previous year, recovered somewhat near year-end, and then deteriorated month after month. By April, with May taking shape, waiting no longer looked neutral.
- Earlier certification launches generating $50,000 to $75,000 had been considered disappointing.
- A strong certification launch could generate $250,000, according to Deiss.
- More recent courses were bringing in $5,000 to $10,000, sometimes barely covering production.
The revenue contraction also demanded more effort. Deiss says the team was doing twice the work to produce those diminished results. That combination changes the management problem: the issue is no longer simply how to improve the next launch, but whether the launch model deserves another production cycle.
He offers several explanations: buyers exhausted by courses after COVID, platforms bringing their own certifications in-house, and the emergence of AI. These are his diagnosis of the pressures, not isolated causes established by the sales figures.
Do presses the structural point. If courses supply the top of the funnel, their collapse eventually reaches the programs and subscriptions below them. A profitable present does not guarantee a replenishable future.
DigitalMarketer's response is to stop selling courses and certifications individually and redirect its intellectual property toward AI-assisted work. The knowledge remains an asset. The question is what that asset should enable next.
To understand why Deiss can separate those two things, it helps to return to the first product he never intended to sell.
The unpaid invoice that changed the business
In 1999, Deiss was a University of Texas student with a job that covered food and rent, but little beyond them. He wanted an engagement ring. Web design looked like a way to earn the difference, despite one immediate complication: he did not yet know how to build websites.
That sounds like a familiar entrepreneurial fable about selling first and figuring everything out later. The actual arrangement was more careful. Deiss told his first prospect that she would be his first client, priced the site at $500, and explained that an experienced roommate would help.
He also postponed payment until delivery. If the work failed, he would not collect the fee.
Do identifies the useful distinction: transparency removed the need to perform expertise Deiss did not possess. The sale was not based on pretending to be an established designer. It was based on making a limited promise with an explicit way to deliver it.
- Disclose the experience gap. Deiss told the client he was just getting started.
- Arrange qualified help. His roommate had already agreed to help him learn the work.
- Put payment behind delivery. The client would not pay until the website was finished.
This did not remove every inconvenience for the client, but it did keep her money off the table until there was something to evaluate. Deiss committed his time before asking her to commit cash.
The arrangement belongs beside the offer-design problem raised by You Don't Need a Personal Brand. You Need an Offer. Here, the persuasive element was not reputation. It was a clearly bounded proposition that made an inexperienced provider less financially risky.
Then the client's circumstances changed. Her husband lost his job, she closed her lactation consulting business, and she could no longer pay. Instead, she offered Deiss a 14-page PDF about making baby food at home.
He was crushed. His share of the rent was $262, and he had hoped to put roughly $250 a month toward the ring. A document was not the payment he had counted on.
But the client had also handed him a lesson in positioning. Lactation consulting ended when a mother no longer needed help nursing. Childhood nutrition could continue serving that same family as the child grew.
Her proposed business was larger than its first service.
Deiss found search interest in homemade baby food, built a simple webpage, and offered the PDF for $14. His pricing logic was hardly sophisticated: one dollar per page. When orders began arriving, the immediate question became whether he could repeat the arrangement with other subjects.
The lesson was not that every unpaid invoice conceals an opportunity. It was that this customer's changing needs suggested a business beyond the original transaction. Decades later, Deiss faces the same distinction from the other side: continue serving the audience, or remain attached to the format that first made the relationship profitable.
Expertise was never the only asset
At first, Deiss thought he had invented something new. A friend's father offered a less romantic description: he was publishing books digitally. The correction initially disappointed him, then gave him something useful, an existing business model to study.
Publishers did not have to possess all the expertise inside their catalogs. They had to find experts, secure the right to distribute their work, and connect it with readers. That realization removed a constraint Deiss had mistaken for a requirement.
He began approaching people who had written substantial articles online and offering to license the material. A roughly 3,000-word article could become an ebook. Instead of learning every subject himself, he developed the ability to identify material that answered a searchable need.
The distinction between making the work and organizing a business around the work is also the territory signaled by Moving from Makers to Entrepreneurs. Deiss's version was unusually literal: he stopped treating personal expertise as the inventory limit.
He did not get every part right. His attempt to publish material under the For Dummies naming convention brought a cease-and-desist demand, he recalls. Studying an established model was useful; borrowing its protected identity was not.
The licensing structure became more deliberate. Through a connection made via SCORE, he found an attorney who helped draft a nonexclusive, perpetual license. Authors received a flat fee rather than an ongoing royalty.
That simplicity was partly ignorance and partly necessity. Deiss says he did not initially understand royalties and had no system for administering payments to a growing roster of contributors. When one author asked for royalties, he declined, expecting the deal to end.
It did not. The author accepted a flat fee instead.
“No isn't always the end of the conversation,” Deiss says.
His available capital imposed another boundary. An emergency credit card supplied by his father had a $250 limit. Deiss used it to fund early licenses, then aimed to repay the balance before buying another.
It was not an elaborate financing strategy. It was a hard ceiling on what he could commit. As the sites generated cash, he began financing additional material from operations rather than the card.
“Constraints can be a gift,” Do observes.
The same restriction appeared in the websites themselves. Deiss wanted the elaborate animated sites popular around him, but lacked the skills to make them. He built simple pages with a headline and text because those were within reach.
The relevant lesson is not a universal claim that plain pages always outperform sophisticated design. It is that his limited production capacity did not prevent him from testing whether someone would buy. Complexity was unavailable, so it could not become a prerequisite.
By graduation, he says, he had a couple hundred small websites and had earned more than $100,000 during his senior year. The operation was no longer selling his own mastery of a subject. It was arranging useful knowledge into an accessible commercial product.
That is the continuity beneath the current pivot. The valuable capability was never only recording a lesson. It was finding a workable connection between expertise and demand.
The founder is not the format
Deiss began producing marketing courses in 2000 because people wanted to know how his online businesses worked. Sharing the methods generated side income, but it also sharpened his practice. Teaching forced him to articulate decisions and keep testing new approaches.
Over time, that activity became part of his public identity. Even after DigitalMarketer stopped occupying much of his schedule, it remained what many people knew him for. Deciding to make one final course therefore involved something a spreadsheet could not resolve.
The retirement decision and the business pivot were related, but not identical. Deiss says he had already decided to stop personally making courses before the worsening sales forced a harder change at the company. One was an identity decision; the other became an operating necessity.
He describes the personal decision as a loss. A role he had occupied for most of his adult life was ending, even though his broader business activity would continue.
The founder's identity is not the company's business model.
That separation did not come naturally or cheaply. Deiss recounts a crisis in 2012, when he was burned out and brought in an outside CEO so he could step back. In his account, the business deteriorated, strong employees left or were dismissed, and financial problems remained obscured until payroll was at risk.
He initially blamed the executive entirely. Looking back, he says he must own at least half the responsibility. That admission matters because the story is not simply about recovering from another person's mistake; it is about surviving the consequences of a leadership decision he made.
He returned, removed the executive, and faced the possibility that the company would fail. He remembers crying on the couch with his wife. Her confidence that he would figure things out helped separate his capacity to act from the condition of that particular company.
“It's the work that you do. It's not you,” Deiss says.
Do recognizes the emotional gap between understanding that statement and believing it. A founder can know intellectually that a company is separate and still experience a declining business as a personal verdict.
Deiss does not promise that repeated failure eventually becomes painless. He says recovery becomes faster, and the problems become easier to locate outside himself. A bad day remains a bad day without becoming proof that the person having it is fundamentally broken.
The ordinary details carry the argument: leaving the office, returning home, being greeted by children who do not care about that day's business results. Family supplied an identity the company could neither award nor revoke.
The wider tension between business achievement and personal stability also frames Why Money Doesn't Solve Everything with Tom Bilyeu. Here, its operational consequence is immediate: someone less dependent on protecting a founder identity can make a decision the business actually needs.
That does not make the decision easy. Deiss knows the pivot will consume money, time, and team effort. He also acknowledges that it can fail.
The freedom is narrower than certainty, but more useful: he can abandon a product model without treating the abandonment as the end of his ability to build.
A final sale is not a final strategy
DigitalMarketer's exit from standalone courses came with a substantial clearance offer: $495 for its previous courses and certifications, a collection described in the conversation as more than $30,000 in material. Deiss says the sale generated hundreds of thousands of dollars.
It also generated suspicion. Customers familiar with manufactured scarcity could reasonably wonder whether this was another temporary retirement announcement, designed to sell products that would soon reappear.
Deiss's explanation was blunt: the products were being removed because people were not buying them. Keeping individual offers available required support that their sales no longer justified. Existing paying members would still have access to the content in the membership back office.
The distinction was between retiring an individual sales model and erasing the material.
The sale served several purposes, none of which by itself proved the next model would succeed. It raised transition capital, gave the existing catalog one last commercial opportunity, and circulated work created by a range of contributing marketers.
- Transition revenue could help fund an expensive, time-consuming change.
- The final offer gave customers another opportunity to acquire the catalog before individual sales ended.
- Continued member access preserved a role for the material beyond the clearance campaign.
There was an uncomfortable comparison inside the result. Hundreds of thousands of dollars sounded substantial, yet Deiss noted that a single certification launch had previously generated revenue on that scale. A successful farewell promotion was not evidence that routine demand had recovered.
Nor was the promotion running on an entirely new audience. He says it relied on the company's own email list, with explanatory posts on LinkedIn and Facebook. The company was drawing value from relationships it had already built.
One execution detail exposed a second problem: optimization could undermine the very relationships funding the transition.
The email announcing the change originally included a short opening, a link, and a longer explanation. The email marketing manager removed the longer passage out of concern that it would lower the click-through rate.
Deiss objected. The stripped-down message sent readers toward a purchase page without enough context for a consequential announcement. He published his own explanation and moved the relevant information higher on the page.
Asked whether the shorter email was probably better for clicks, he conceded that it was. That did not make it the right message.
Optimization does not replace judgment.
This is a practical boundary, not a rejection of measurement. A click-through rate measures one behavior. It does not fully describe whether the recipient understands what is happening, trusts the explanation, or feels manipulated by it.
That communication problem sits naturally beside Storytelling Is A Superpower. In Deiss's case, the explanation was not decorative material surrounding the commercial message. It was necessary information about why the offer existed.
The company needed cash, but it also needed permission to keep serving those customers in another form. Trading the second for a marginal improvement in the first would be a poor foundation for a pivot.
A final sale can finance a transition. It cannot substitute for a reason customers should follow.
The lesson becomes an input
The next direction emerged from Deiss's own behavior as a customer. He bought a course containing roughly six hours of video and did not have time to watch it. The content was not necessarily the problem; the path from purchase to useful work was.
Rather than begin the lessons, he asked his assistant to have the videos transcribed through Rev.com. He then supplied the transcripts and worksheets to ChatGPT and asked it to work through the material with him toward the output the course was intended to produce.
He reports having that finished output in about 30 minutes.
It is a striking anecdote, but its limits matter. Deiss does not identify the course, describe the finished artifact, or provide an independent assessment of its quality. The experience supports his account of a changed workflow, not a claim that every six-hour course can be replaced with half an hour of AI interaction.
What changed was the role of the material. The lessons became inputs to a working session instead of a sequence he had to consume before starting.
The opportunity is to connect expertise with execution.
Deiss says the conversation remained available for later work on the same subject and eventually became a project inside ChatGPT. The purchase had therefore supplied more than a single result: it had furnished reference material for an ongoing interaction.
His proposed direction for DigitalMarketer follows that experience. Frameworks, models, and intellectual property developed to teach people could instead help AI assist people with the work. In his description, the educational asset survives while its immediate user and delivery mechanism change.
The conversation provides a direction, not a finished product specification. It does not establish pricing, a launch schedule, customer adoption, or proven economics for the new offer. Those remain separate tests from the personal experiment that inspired it.
The practical sequence he actually describes is concrete:
- Obtain transcripts of the course videos.
- Bring the transcripts and accompanying worksheets into ChatGPT.
- Work toward the specific output the course was designed to produce.
- Return to the conversation or project for related work.
That sequence is not a general invitation to redistribute someone else's course material. In the story, it describes how Deiss used a course he had purchased for his own work. The commercial pivot concerns DigitalMarketer's existing knowledge assets, and the conversation does not detail rights arrangements for future products.
The deeper change is in what the seller asks the customer to do. A conventional course requires attention before application. Deiss is testing a model in which the material supports application more directly, with the customer participating in the work rather than first absorbing the entire curriculum.
For an education business, that changes the competitive question. More recordings do not automatically remove the obstacle that kept this particular buyer from watching six hours of recordings. The bottleneck was not access to instruction. It was the time and effort between instruction and completion.
Deiss's early client understood the same strategic distinction without AI. Nursing was one stage in a family's needs, not the permanent boundary of a nutrition business. Now courses are one stage in DigitalMarketer's relationship with marketers, not necessarily its permanent commercial form.
The next offer still has to earn its place. A useful experiment is not a validated business, and a recognizable founder is not a guarantee of demand.
But the decision criterion is clearer than the technology forecast: preserve the ability to serve the customer, not the obligation to keep selling the same container.
The course is negotiable. The customer's problem is not.
TRANSCRIPT
My next guest is someone I've had the pleasure of meeting in real life, IRL, and he's a fellow introvert and I'm Ryan Dice and you are listening to The Future. Ryan, for people who don't know who you are, can you please introduce yourself? So I'm Ryan Dice.
I founded a company called Digital Marketer about 20 years ago. That's probably what I'm best known for. But in reality, I'm a serial entrepreneur.
I started my first company back in 1999 from my college dorm room so I could buy an engagement ring for my then girlfriend, now wife, and today run a portfolio of companies that collectively do about $200 million a year in revenue. So get to run businesses, scale businesses, buy businesses, sell businesses, and tell people how we do it. It's a lot of fun.
That's a lot of business in the businesses here. And $200 million for most people is like a staggering amount of money. It really is.
So before we get into the big announcement, can you take me back to 1999 in the dorm and you're like, let me start a business. What conditions were present in that moment where you thought to yourself, hey, I'm in school. I need to make some money.
A business is the way to go. So I was in college, I had a job. The job paid rent and food but nothing else.
So I knew if I was going to make any extra money, it was going to have to be through some kind of a side hustle. And look, I'm going to the University of Texas. At that time, there was all this talk about how Michael Dell had started Dell Computer from the dorm across the street from where I lived.
It was the dot com era back when we called internet startups dot coms. And I thought, hey, I'll try to start a dot com. Well, I didn't know how to do that, but I thought maybe I'll try to get Some work doing web design now keep in mind I didn't know how to do web design But I figured if I could get some clients I could teach myself how to do web design over the weekend and So I marketed myself as a web designer and I managed to get a client and I then went to the local books, my student bookstore.
I got a student edition of wait for it, Adobe go live. I remember I was there. I'm old enough to remember.
So yeah, I got a student edition of Adobe go live and I built my very first website for my very first client who was actually a lactation consultant. Now, I have four kids today, so I have all respect and admiration and appreciation for lactation consultants, but when you're 19 years old, building a website for a lactation consultant from your college dorm room, it's a little bit awkward, a little bit weird. Your friends think you're into some creepy stuff.
Long story short, this amazing woman, her husband lost his job. She had to shut her business down and go back to the corporate world. And she came to me and said, "Hey, I can't pay you." I've got my first client.
I've built a website. And she comes to me and says, "I can't pay you." She said, "But I wrote this ebook on how to make your own baby food. And so I'm going to let you have it.
Maybe you can sell it and make some extra money." Wait, I got to pause the story. There's too much going on here. First of all, in today's age, If you're doing research on lactation, you probably have to come up with your screen.
People walk away. No, it's not what it looks like, guys. I'm doing this professionally.
Okay. i don't understand you you don't have a skill but you go out to sell the thing that you don't know yet how to do this is classic marketer material it's deep in the dna already because unlike a lot of creative folk who's like let me perfect the product first and let me get this just right everything's perfect then they go market and find out no one wants it you did what marketers do which is you go out there you find the market first and then you're like i now have a good problem i actually have to deliver on the promise and you went out there and you found a client and you sold the thing you did not know how to do, what is in your mind the entire time? Because for most of us, screaming inside of our head is, "I'm a fraud.
I'm a fraud. If she asks me any questions, I won't be able to answer any kind of questions at all." How are you going through this and able to confidently sell this thing? I didn't sell it with any confidence.
I think this is really important. If you're a creative, you don't have to pretend like you know everything. You can just be honest.
And so what I said to her is I said, look, I'm just getting started. You would literally be my first client. And that's why I'm going to charge you a whopping $500 to build you a website.
I guarantee you it won't be the best, but it'll be the cheapest and I'll work pretty quickly. My roommate, is a really good web designer. I'm going to get his help on this.
And at the end of the day, if I can't pull it off, I'll give you your money back. And you don't even have to pay me until the end when it's all until when I'm done. And so the way that I justified it to myself was if I wasn't able to deliver, I would never have taken the money.
And I think that's really important. I was only actually risking my time. I wasn't asking my client to take a risk.
I was still taking on all the risks. So I was happy to go out there and sell it first because one, I was being honest about the situation. Two, I was the one taking on all the risk.
I think way back in 1999, Ryan has uncovered the irresistible offer already. He's like, look, it won't be the best, but it'll be the cheapest. And I'm like, well, I can't say no to cheap.
And she said, yes, right? It was all I had. And what I did know, again, I knew I knew somebody who actually did know how to do this stuff.
And I think that's important. I wasn't all by myself. I wasn't on an island.
I joke and say I knew I could figure it out by the weekend. The reason I knew I could figure it out is because I had somebody I could tap who could show me how to do this stuff. And he'd already agreed to show me how to do this stuff.
So I think that's important. People think that their skill set is limited by what they know. In reality, your skill set is limited only by what everybody in your network knows if you're just willing to humble yourself and ask people.
Spoken like a true entrepreneur, spoken like a true marketer. You sold first. You were fully transparent, so you didn't have to hide anything.
I love that. And that's great advice, everybody, because the opposite is not good. To pretend you know something more than you do, you get yourself in a lot of hot water.
and you had a good backup plan, somebody that you could call up on and get help from. And this is a classic example. It's who, not what.
It's not what you know, it's who you know. And you knew somebody who could help you, who could do it in case you effed up, you could figure it out. So you're not going to screw over a client because you were just incompetent.
This is excellent so far. Now, the part of the story, we're gonna pick it up here. You've done the work and then all of a sudden your client, did I understand that correctly?
- Oh yeah, yeah. Amazing lady. I don't have any money, but I've got this ebook.
Now, I want to back up just a little bit because it breaks my heart. I've tried to find this woman. I really have tried to find her because I owe her everything.
Because what she... taught me without realizing it is one of the most important lessons in business, which is your business is not a function of what you sell or how you sell it. Your business is a function of who you serve.
And so what she said was, I wrote this ebook because I'm a lactation consultant, but once I help moms nurse and they figure it out, they don't need me. And definitely once their babies wean and they're not nursing anymore, they really don't need me. me so what i want to define myself as is more childhood nutrition and so i want to get into helping moms to produce great tasting food themselves for their kids at all ages and i'm starting with how to make your own baby food from home so that was her her model and that lesson always stuck with me it really did so she gave me this pdf report and i remember it was 14 pages long I'm thinking to myself, what the heck am I going to do with this thing?
Keep in mind, this is pre-Kindle. Amazon existed and it was a bookstore, but nobody was really selling e-books online. I don't know if the term e-book, it probably existed.
I was but I was doing some research. Google was still a science fair project at this point. Right.
I mean, we were trying to optimize for like AltaVista and Dogpile and like all those things. Let's see if we can make this happen. Like if you were anywhere on Yahoo, you thought you just hit the frickin lottery.
But I was doing some research. I'm like, you know what? There's actually quite a few people who search for how to make your own baby food.
But there's really nothing out there about it. So I bet if I built a simple little webpage, did some basic optimization, which back then the big growth hack was you just repeated the keyword over and over again at the bottom of the webpage and made it the same color as the background. That's what we did.
Doesn't work anymore, obviously. But I bet if I do this, I can get it to rank. And I did.
And within literally a day or two, there it was. And I charged $14 for this ebook because I figured a dollar a page. Made sense to 19 year old Ryan, dollar a page.
I had a PayPal link and I will never forget the first day that first order came through. I was like, this is it. This is amazing.
It just happened. And then the next day, another one did. And all I could think is what if I had 10 of these?
And that's where it all began. If you had 10 of these, you'd be able to buy lunch and dinner. Yeah.
Beer money. And then eventually ring money. And that's exactly what happened.
Got the ring, got the girl. The rest, as they say, is history. Okay.
She says, I have this e-book and you can just sell it. Is she giving you the eBooks that's trade for you to make money or you have to share some of the money with her? No, she just gave it to me.
She said, here you go. Take it. Try to make some money.
I'm sorry. I can't pay you, but I'll, I'll give you this. And it's not like we, she signed over copyrights or anything like that.
I actually tried to follow up with her to do some updates to it. And I never could find her. Is it her name in the book?
Yeah. I had her email address and everything. She never responded or anything.
I have no idea what happened to her. How did you feel in the moment when somebody's like, and 500 is like real money, starving student. She's like, man, I don't have money, but you can have this other thing that maybe you'll make something of it.
In that moment, what were you feeling? Dude, I almost cried. I mean, it was my portion of the rent was $262 at that point when I was in college.
And I was thinking that was kind of how I was going to make rent that month. And I was trying to set aside $250 to a month for the ring fund so both of those were done i was like okay not only do i need to make rent money but toodaloo ring fund and yeah i was crushed i had to start all over again and i put so much work into this website because i again i didn't know what i was doing i had no idea what i was doing but the nice thing is is that the next time i built a website for somebody i it didn't take as long but i'll tell you i wasn't in the web design business for very long Pretty soon I was in the publishing business. I just want people to be aware.
I had to ask that question because if I was in your shoes, yo lady, I didn't barter for the book. I want cold hard cash. I want some bills here.
I need some greenbacks. And you weren't defeated in that one moment. You figured out a way to do this and it opened up new doors.
I have to ask this question. What the heck were you studying at the University of Texas? I was originally liberal arts undeclared because I didn't know what I wanted to be.
Then I was an ancient Greek major because I thought I was going to go to seminary and I figured I would get my Greek stuff out of the way. Then I tried to get into the business school, but I couldn't because I made a C in Greek, which is why I figured I shouldn't be an ancient Greek major, but they wouldn't let me in the business school. So I became a corporate communications major because it was the thing that sounded the most like business.
I didn't really study much in college. I mostly Just worked on actually doing business stuff. - You didn't study business, you just ran businesses, I guess.
- Yeah, and I'll tell you what's fun, kind of side story on that. I now go twice a year. There's a professor in the business school that has me come out and teach a class.
And for the first few years, he would introduce me as a graduate of the University of Texas School. And I would have to say, I did not graduate as a business student. And now he does it just for fun.
I was like, y'all didn't let me in, so I started a business instead. - Yeah, they try to take credit for it after the fact, but. Like, no, you guys didn't let me in, but that's okay.
Not holding any grudges, apparently. Well, I think you find two new fields. One is web design, which isn't related to corporate communications.
And then, oh, I could do marketing and not web design. And then now you're mentioning something about publishing. Okay, take me there.
So I'm selling these eBooks online and I think I've done figured out something new. I've stumbled across this brand new thing that nobody has ever done before. And I remember I was talking to my friend's dad and I'm telling him about what I'm doing.
And he's obviously a much older and wiser person. And he said, "It sounds like you're just doing book publishing, just digital stuff." And I remember thinking, at first I was disappointed because I thought I'd come up with something new. And then I remember thinking, "Oh, actually this is great because I have something to model.
There's something out there that I can learn from." And so I began studying. what do the big publishing houses do? And so I'm looking at Wiley and I began studying like for dummies.
And so I decided actually that I was going to begin coming up with my own for dummies books. And I'm not even kidding. So I created like blogging for dummies.
not knowing how trademarks or copyrights work. So I put that out promptly get a cease and desist from them, which they're fully well in their right to do that. Cause I mean, I was like, oh my gosh, terrified.
I took, I took that down. And what's funny is I now have a for dummies book. So we kissed and made up, but I looked at their model and how all these publishing houses worked with authors.
Cause in the beginning I thought, oh, I've got to be the expert, but I don't know anything. Well, I realized, Publishers aren't an expert in anything. They find the experts and they publish the experts.
So all I have to do is find people who have books on stuff, but they haven't published them anywhere. So I began scouring the internet for people who had long articles that were written about things. And I said, hey, can I license this from you?
And I remember I'd pay people $250 to license what was maybe a 3,000 word article that I could turn into an ebook. And that's the model that I had. So when I realized I was a publisher, I no longer needed to be an expert.
I needed to be the person that found the experts and I would pay them a singular flat fee, license the content, put it out there. And that's how I went from one to by the time I graduated, had a couple hundred stupid little websites, selling a bunch of stupid little ebooks on all the crazy little long tail topics you could imagine. When you said you licensed that material, do you pay him a flat fee to be able to use it or do you pay a fee and then a royalty or something like that?
I paid a flat fee for a non-exclusive perpetual license. It was what I figured it out. I actually found an attorney and he helped me craft a license.
And this was somebody I found him through. There's this entrepreneurial organization that's been around forever called Score. It's the Society of Retired Executives.
And so through SCORE, again, tapping a network, when you're the young kid, and you're asking sincere questions, people want to help you. And so there was this old guy in there who said, "Hey, let me see if my attorney will help you out." He basically helped me out. I don't want to say for free, but I paid him a hundred of dollars to draft up this license agreement.
And yeah, it was a flat fee. And the reason I did a flat fee instead of royalties is number one, I didn't know what a royalty was. And number two, I didn't have any means to pay royalties to all these different people.
So I remember I had one person one time ask, hey, can I do a royalty? And I said, no, because I don't know how to do that. And they went, okay, then we'll just do a flat fee.
I realized like, "Oh, great." I assumed when I said, "No, I can't," that that was the end of it. This is the first time I learned that sometimes you can say no, and when you say no, they'll still come back and do a deal with you. No isn't always the end of the conversation.
There's a bunch of great things that are happening in the story of yours. One is people think triple W means World Wide Web, it means Wild Wild West. In the frontier days, you can pretty much ask for anything if you have the idea and the follow through and you were able to do this.
So you licensed, basically you bought a perpetual non exclusive right to distribute these books. So you took some risk, but assuming you didn't pay that much for these license, if you made any kind of sales, you'd be doing okay at some point, right? Yeah.
My dad gave me an emergency credit card. When I went off to college, he said, only use this in emergencies. But thankfully, he never really looked at the bills or anything like that, that came through.
And I figured that out because early on, I had an actual like emergency with the car. And, you know, it happened and he didn't pay it. because he didn't see it.
And he's like, oh yeah, I didn't look at it. And so I was like, well, maybe he's not looking at it. So I remember the limit on this card was $250.
The max that I could pay for a license was $250. So my goal was to pay $250. And then as soon as I paid off the card, I could go and do another license deal.
And so that was how I did my first few. And then it got to where there was enough in the accounts where I didn't have to use the emergency card to fund anymore. I could just fund license deals out of their own operations.
And then I started working with certain authors. They would just produce new things for me. And then around this time was when the freelance writer space started to open up and I started working with people overseas to produce things as well.
are you done with school yet no i'm still in school at this point okay so you're going to class trying to do your best not to flunk out of Greek studies. Only a semester of Greek. Okay.
You did one. You're like, I got a C. I'm done.
My Greek professor said, you made a D in my class, but I'm going to give you a C as long as you promise not to go on to Greek two and continue to major in this. He was very gracious. So you're going through school.
You're basically running a business publishing empire out of your dorm room, wherever you're at. Do you graduate? Yeah.
Yeah. I graduated and got married literally the weekend after I graduated. How long did it take you to make that ring money?
It took about a year and a half. Okay. So you're hustling and grinding for a year and a half doing this stuff.
So it's not rags to riches so fast. It's like, okay, I got a thing. I'm building something.
Now I have money and I'm able to do this. Very few people are able to afford an engagement ring, especially when they just get out of school. They're mostly sacked with debt.
Yeah. And I did still have... student loan debt when I left college, not just tons and tons and tons, but I definitely had, certainly not by today's standards, but I definitely had some.
But by the time I graduated, I was making six figures. I'd made over $100,000 my senior year. And Chris, I didn't realize that was a lot of money.
I thought that that's just what all adults made. In fact, I still went and took a job in financial services because that was my part-time. I still had a part-time internship as well.
And so they offered me a job right out of college and I took it. And so I'm working now in this position and I was there for about six months before I realized how much these people who had been working there for a really long time were making. I'm thinking to myself, God dang it, I'm making more with all these silly little websites.
And I walked into my branch manager's office and quit. And that's when I went full time. So I've only actually had a real job for about six months.
This story could have turned out a thousand different ways, different people, different outcomes. But there's something clearly very special and unique about you, Ryan, that you see opportunity. You're like, I don't know.
I'll try this. And I don't have any money, but I'll make it work with the money that I have. Discipline, not to overspend because you couldn't.
So there's a point here I wrote down. Constraints can be a gift. Your lack of knowledge and your lack of funds made you work in a very specific way.
Perhaps in this moment, if you had a thought about royalties and you had the money, you might have structured the deal very differently and made it much more complicated. Even to track royalties would be just another thing. It's just really difficult.
I mean, now it's not so difficult, but there's a lot of moving parts and you'd have to spend more time dealing with that than just thinking, what's the next book idea that's going to work? And you're freaking out SEO, doing keyword stuffing. You figured out how to game it already.
And you're not even out of school at this point. Yeah. Let me tell you a quick story that I was a year and a half into this.
I remember it was my junior year. Somebody came to me. And it was at one of my engagement parties, that was it.
So he's hosting engagement party and they were like, what are you going to do after you graduate? And I was like, I don't know, I've got like these little internet businesses, maybe I'll just do that. And I realized that that was the wrong thing to say to adults.
because he was like, what are you talking about? And I was like, oh, I've got this thing and I sell these eBooks online. How much do you sell them for?
I was like, well, you know, $14, 16, it kind of depends. Like you sell a PDF for $14. Nobody will pay $14 for a PDF.
And I remember he said that for a second. I was like, oh my God, they won't. And I was like, wait, but they are.
And they have been for a long time. But had somebody told me, At the outset, before I did it, I would have believed them. And I think one of the mistakes that creative people make, that entrepreneurs make, is they talk about what they're going to do before they do it.
And they open themselves up for outside criticism to come in. I just went and did it. And I didn't ask anybody if they thought it would work.
And I'm so glad that I didn't because I guarantee you I would have gotten opinions. And those opinions would have been from well-intentioned people telling me not to waste my time, to just get a second job. I know for a fact that's what I would have heard because that's what I heard over and over again after it was already working.
And yeah, you're absolutely right. Had I known about royalties, I would have tried to come up with the most complicated way. I know that because I get myself in trouble today.
Projects stall out because I'm too smart. I threw up air quotes. You're just listening, by the way.
And that's what stalls out projects all the time. Whereas the simplest way just gets it done. I'm just a few years older than you.
And I'm almost cursed because I had a singular focus on becoming a designer and then a director working in LA and advertising agencies. But the same opportunities or the same ideas did cross my path. I remember this is the genius I am.
because my older brother he's four years older than me and he's in software engineering graduate from stanford he's like hey are there some urls you could think of that we can just buy like why would we do that because people will want them like what a dumb idea And then he goes, you know, there's this company, they sell books, it's called Amazon. Maybe you should invest. Well, eBay, Amazon, nah, it's not going to go anywhere.
That's the foresight I had. Because I was like, my vision was just solely locked in on design, typography, moving images and animation and motion design. Where I think you, it's so weird that everything is working out perfectly for you because I can't major in that.
I didn't get to that school. So I'll just be the most, I'm sorry to say this, the broadest thing, corporate community, what? Corporate communications?
Had I gotten to the business school, man, I bet I would have abandoned my little websites and got a great job in business. I probably would have pursued that. Almost certainly.
Let me give you another example. At the time I was building websites, what everybody wanted to build was these like flash sites. You remember when you go to a website, it was all the flash animation.
I didn't know how to do that. So all of my websites were just simple, single column tables with a headline and H1 at the top and then text below. Well, they look like that because it's all I knew how to do.
But what do we now know converts the best? Not the swirly twirly flashy stuff, the single column website. Like what does everything kind of look like right now?
What I was building back in 1999, 2000, 2001, not because I mean, I wanted to build the flashy stuff. I just didn't know how. And I just lucked into the fact that my pathetic, no nothing design asked like what I was doing was what just happened to work.
And so yeah, bring on the constraints. We've not known each other for a long time, but what I've gotten to know is just a very funny personable guy who has a perspective on things because it's almost like I'm not saying you're old because I'm older than you, but you were there at the invention of fire. You know everybody before they were anybody that anybody knew anything about.
So there's some fun conversations to have there too. Okay, let's get into this whole, I'm retiring. I'm putting this thing away.
Before we tell people Well, the next thing, what is it you're retiring from? Almost as soon as I began selling little eBooks online, people started asking me what I was doing. Because back then it was all forums.
There's all these different forums where people are talking and I'm trying to learn from people. People are learning from me, people are sharing. And so I had an email newsletter.
Back then we called them e-zines. I don't know if you remember that. So I'm creating courses talking about what I'm doing as a little side thing.
I never really considered it my real business and it's never where I generated the bulk of my income from, but it did create a nice little side income and it kept me sharp. It made it to where if I taught what I was doing over here, it may be better at the actual doing. And it kept me accountable and made sure that I was always doing new stuff as well.
So for as long as I've been doing this stuff, I've been sharing what I was doing. It's just how I've always thought. I never saw it as a downside.
Oh, they're going to figure it out. Maybe I should have, but it's not how my brain works. Because again, back then, everybody shared everything.
It's just sort of how the online marketing community worked. And so I've been producing courses since 2000 was when I put out my first marketing course. And I basically have been creating marketing courses to some degree or another every year since 2000.
So for 25 years, I've been making marketing courses. I'm 44 years old, which means I've been making marketing courses longer than I haven't. Now, I made the decision at the end of last year that I was going to make one more course for my company, Digital Marketer.
And then after that, I was done. I was personally going to be done making marketing courses. I wasn't going to make a big deal out of it because who cares?
When I made that decision, It was a big deal to me. It was a big identity shift. There was a sense of loss there.
Even though I don't do it very much anymore, I spent almost no time at Digital Marketer. Again, it's not my primary source of income. It's what I might be most known for, but it's not my main gig.
It was still to say, okay, I'm not going to do that anymore. It's kind of like when Matthew McConaughey decided he wasn't going to do rom-coms. It's exactly the same thing because we're both complete dream boats, right?
A-list kind of people. Now, it felt a bit like a death. But at that same time, my company, Digital Marketer, man, sales were just like tanking.
We've seen sales start to decline a little bit and flatten out a little bit in the course market and the certification market. But this year they started off soft and they just gotten worse and worse and worse and worse and worse. And so we made the decision, okay.
And we were already heading in this direction, but I said, like, enough is enough. We need to make a hard pivot. And so I just used it as an opportunity to say, hey, I'm done.
I'm retiring from this digital marketers pivoting. And I did what I've always done. Let's market this thing.
Let's create a message out of it. And it worked. Can we talk data?
Yeah, let's do it. You're seeing numbers that I think are going to paint a clear picture because you're at a scale that most of us are not even close to. When you're saying like we're seeing this slow and steady decline of digital courses, we're seeing it.
My friends are seeing everybody's seeing it's not like, oh, my God, this is crazy information that doesn't make any sense. We're seeing that. So what is the revenue gross sales from the courses that you produce?
Can you give us some snapshots? And when you say it's fallen off, like I want to know how fast and how far it's fallen off. So digital marketers got a number of different revenue channels, courses and certifications.
make up about 40% of that revenue because it has membership and subscriptions. It has licenses. There's a corporate component to it as well.
The 40% in digital marketer really prior to the last couple of years has been an eight figure business. So just to kind of put that into perspective, the courses component is down to about 20% of what it was just two years ago. It's not down 20%.
it's down to 20% of what it was before. When we used to, for example, if we were to release a new certification, it would be really, really, really bad if this certification only did $50,000, $75,000. Well, I mean, you're talking about weeping and gnashing of teeth.
We're like, what has happened? This is terrible. A good one would do $250,000.
We would put out courses and it would sell 5,000, 10,000, I mean, barely enough to cover what it costs to produce the thing. And it would take twice the work to get that done. And there was a lot of factors that led to this.
I mean, certainly post COVID, I think a lot of people got kind of coursed out. And I think in the marketing space, when digital marketer pivoted into certifications in 2015, nobody was doing certifications and there was no professionalization going on whatsoever in the digital marketing space. And so a digital marketer, we could kind of step into that void and say, we will professionalize this area.
And then the market welcomed us with open arms. We were even working with like the HubSpot of the world to produce certifications. Facebook, what came to us and said, you do a better job of telling people how to use our services than we do.
We're going to open up our new ad channels to you before anybody else so that you can teach it to us. Right. That's what it was like in like 2015, 2016, 2017.
Well, slowly those doors started closing. Why? Because they started releasing their own certifications.
Of course they did. They're going to bring these things in-house. So the combination of that post-COVID and then I think the emergence of AI all led to this.
So we had to make a change. This episode is brought to you by PayPal. You know how a mom's bag has everything?
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You said the A word. We're going to get to it, everybody. Hold on tight.
We're going to get there. I'm sorry to delay this. Storytelling is about creating tension and delaying gratification.
So just hang in there, everybody. Okay, he said eight figures. You're all like, "Wait, wait, I'm used to hearing six figures." So we're talking about generating tens of millions of dollars annually, and then we're seeing a drop-off.
And what does the beginning of the drop-off look like to you? What reduction in sales down to like now it's 20% of what it used to be? - We could see it at the middle of last year, a softening.
We could begin to see a softening in the middle of last year. We always see an uptick at the end. So in fourth quarter, it's kind of this like new year, new you.
And so it seemed to come back a little bit at the end of the year. And in the middle of last year, the economy's not doing so hot. At the end of last year, we're post-election.
People are, whatever you feel about who won, there's kind of this just general, okay, at least now we know what we're going to be dealing with. And it's the end of the year. So stuff started to kind of come back.
But then coming into January, we're like, this isn't quite the start to the year that we thought. Then there was February and it was even worse than January. Then we thought, boy, it can't possibly get worse than that.
Then March showed up and then April. What we were seeing is that month over month, it was getting worse and worse and worse. A month does not a trend line make.
Two months, not necessarily, but when three, four months in a row, And then when we saw the sales numbers for April and where things were looking for May, that's when it was clear we have to make a change. We have to make a change now. If we don't, we're not going to be around 12 to 18 months from now because courses and certifications, they're the tip of the spear to everything else that digital marketer does.
So I said we've got these other lines of business, but it's the courses and the certifications that typically bring people into our world. Without that, yeah, we've got MRR and we've got subscription revenue, but that churns out. And without the courses and certifications to bring new people in, that brand would simply die a slow and profitable death.
So you're seeing by the way I can envision the graph in my mind here, it slows down middle of last year, but there's a nice pickup at the end of the year. Like maybe it will. Okay.
And then now it's falling off a cliff because you're talking about month to month and now down to 20% of what it used to do. So you're talking about an 80% drop down to 20%. And it's top of funnel for you.
So people buy the courses, then they enroll in the programs and the coaching and all the other stuff that they get to participate in. And if the top of the funnel is falling apart, you know, it's just a matter of time because eventually attrition, everything else, people get out of the programs. And if you're not feeding new people into it, it's not going to be around.
Okay. So you're the CEO, people have to make tough decisions. Teams usually hold on to companies long after the body's gone cold.
It's the CEO is like, you know, I know where this is going, guys. Very rarely does it go like that and it goes back up. It just goes one direction, generally speaking, when you see month over month performance.
Was it a hard decision for you? Fortunately, because we have a portfolio model, these are the decisions that I've had to make a number of times with different businesses. I'll also say at this stage of my career, my companies are not my kids.
I've got real kids at home that I love. And so I don't have the same emotional investment in the businesses that I probably would have had 10 or 15 years ago. The hard part about it is I know just how much freaking work it's going to be.
It's just so much work. And I know how much work it's going to be on the team. And I also know it might not work.
The pivot that we make, it just might not work. Like it's the best worst option, but there's no guarantee when you make the decision to make a big change that the decision you've made is is the best one or the right one, or that there was any good decisions left out there for you. And so you always, I think, have to do business with that to a certain extent.
And you have to just say, yeah, maybe it won't work out. And I think you have to make yourself get okay with that. And I've had enough business failure in my career and I've gotten to the other side of it.
And I've gotten to see that like, you know what? My wife still loves me. My kids still love me.
There's still a roof over my head. And I still have the ability to go out there and build something again. And as long as those things are true, I think I'm going to be okay.
That gives credence to something Seth Godin said, whoever plays the longest wins. So you have enough in the war chest to play as long as you want to play. There's no component here because there are people who have businesses, who have ideas, who are happily married, who have children, But emotionally, they're just so tied into their own identity to the business that letting this part of the business go means for whatever reason, part of their identity dies.
Did you have to wrestle with that? Because it's something that you've had for a long time now. I did in 2012.
I absolutely went through that. The company Digital Marketer back then, I was all in it and I was the face of the company. I was producing a lot of the products.
I was incredibly burned out. To try to extract myself from the business, I brought in an outside CEO to come in so that I could take some steps back. I didn't At the time, immediately afterwards, I completely blamed this person for everything.
And looking back retrospectively, I've got to own at least 50% of it, but brought this person in. And we went from being a successful business to most of the best people had either been fired or run off. And the company had gone from being incredibly profitable to losing lots and lots and lots of money.
And most of that being hidden from me through, let's just say, creative accounting. And it wasn't until it was at its absolute worst. And one of my now business partners came to me and said, hey, I don't know if you realize this, but we're about to not make payroll that I stepped back in.
and let this person go and retook the reins and truly did business with the reality that this is going to fail. And I remember being so incredibly depressed and literally crying on the couch to my wife. And this has happened more than once to me.
And it's just something that I think you need to go through, not because it's fun. You don't get a merit badge at the end, but there's something about realizing that you are not your business. that I think every entrepreneur really needs to go through to know that you can get to the other side and to feel that sense of separation because you're not, you're not, and you don't want to be.
It's the work that you do. It's not you. It's hard for a lot of us when we have a business failure that we think we're failures too, especially the more personal business, the one that you've built from the ground up for the majority of your adult life.
when it doesn't work, it just feels so bad. And logically, you know, it's not you, but emotionally you feel it. Does it get better each time you have a failure where maybe you're not crying on the couch as long or you recover faster?
Yeah, I think the recovery is a little faster. I don't know that it necessarily feels any better in the moment, but what I've found is that I don't internalize it as much. So I am able to let it be something that's happening but it's happening over here as opposed to something that's necessarily happening to me.
And that's the distinction that I think is important. And what is so nice is just, it's one of the reasons why I like having an office separate from my home. And I do wish that more people did that or that you created a truly separate space.
Because when I leave the office, I can go to my home And there's my kids. And now they're getting a lot bigger and they're doing their own things. But I remember back then, I would go home and I would just get tackled by little kids.
Daddy, they didn't care what a terrible day I had. They were just there and they just loved me. I remember sitting on the couch, basically crying in front of my wife.
And she was like, I don't know why you're so worried. You'll figure it out. You always do.
And sometimes that's exactly what we need to hear. And so it's just going through this. that makes you realize that it builds up a scar tissue that I think we need to have to make it through that next time.
There's no other way to build up scar tissue than to just kind of get beat down a little bit. I'm going to have a really weird request of you. Feel free to say no.
There's a lot of people are going to listen to this or watching this and they don't have that person in their life to tell them it's going to be all right and you're going to figure this out to get them through that rough patch they're possibly going through right now because there's a lot of funky stuff in the air right now. We know of friends who are going out of business. We know whole agencies and industries that are collapsing on top of themselves.
People who haven't had a new client in over two years. Can you put on your best, most empathetic hat and voice and look in the camera and just tell people what they need to hear so they can get through this rough patch? What I want you to hear is that it sucks and I'm sorry.
And you are not your business. Your business is not you. And whatever happens, however this comes, like you're going to be on the other side of this and you're still going to be you.
And that you that started this business is going to have the opportunity to either resurrect this business that you have right now in a new and better way or to start something completely new. But if you're in a storm right now, which we're all in, I've gone through a lot of cycles, a lot of different business cycles. I remember 2001.
I remember 08, 09. This is as crazy and hairy as I have ever seen. So we are in a storm right now.
So if you're merely surviving, you're winning. We need to readjust our expectations. If you're surviving out there right now, especially if you're serving small businesses, you are winning.
We cannot go back and look and say, oh, I'm not experiencing the growth that I was experiencing in 2020, 2021. Surviving right now is winning. If you're in a storm, that's not the time to build another ship.
It's certainly not the time to stop rowing. You just got to keep rowing. And as long as you can keep rowing and as long as you can survive, this too shall pass, this storm will pass.
And when it does, value is going to accrue, market share is going to accrue to those people who hung around. Whether hanging around looks like this exact same business that you have today is kind of irrelevant. As long as you hang around and you stay in the game, that's all that matters.
So just commit to yourself that you're going to stay in the game. This business is a vehicle. Maybe it'll be this one.
Maybe it'll be a different one. But just commit to staying in the game. Thanks, Ryan.
I've had to have that conversation with two entrepreneurs today. Today? Today.
Clients that are going through it. And I'll tell you, one of them has a business that's doing mid-ish seven figures. The other one has a business that's doing high eight figures.
So if you think that this only impacts you if you're kind of in the six-figure range, just know everybody at every level is kind of feeling it right now. And the advice to everybody is the same. It's not easier at these different levels, just there's more zeros at the end.
You just have more people that you're not able to pay if you can't make payroll. But dang it, y'all, I'm telling you, it's not going to last forever. It's not.
It only never has. As far as I can tell from the retirement of digital marketer in terms of the courses, you're sunsetting the program. And you decided to make a big announcement out of it, put on the marketer's hat and said like, hey, if the ship's going down, let's like make firewood out of this.
Let's see what happens. And you're selling 30 plus thousand dollars worth of courses and certifications for I think like a little over 400 bucks. Is that right?
$495. Yeah. We literally took every single course and certification that we have sold in the past.
Because we're going to pull them off the market. Digital marketer is getting out of the course and certification business. And people have said, oh, this is just a gimmick.
I've seen marketers do this in the past. How do we know that this isn't just a gimmick that you're not going to bring them on? And I'm trying to tell people, it's like, you don't understand.
We're not doing this as a gimmick. We're doing this because you weren't freaking buying them. I don't know how else to say, like I'm trying to be like really transparent about this.
We're taking them off the market and pivoting our business model because none of you were buying them. And so it doesn't make sense to even have a couple of them out there for sale because it literally costs more money to support them on an ongoing basis than it does to leave them out for sale. We've got them still available in the back office for our members who are paying on an ongoing basis, but to sell them all a cart, costs more money.
So that's why. And you're always like, "Oh, it's a gimmick." It's like, no, it's not. But let's go ahead and have one last hurrah.
One, because we can generate a significant amount of revenue that we can pocket to help us in this transition. And this transition is going to be time consuming and it's going to be expensive. So building up a war chest That's a good idea.
Anybody who's doing that, that just makes sense. Number two, I think it honors the content that's there. A tremendous amount of work was put in to those products.
And it's not like it's all mine. We worked with some phenomenal marketers to produce these products. I'm not trying to sell this to anybody right now.
By the time this airs, it will have closed. But I want to honor those, the people that put in the time, the effort, and their knowledge and expertise to produce that by sharing it. And Finally, it's just what a marketer should do.
I mean, I'm a marketer. We're marketers selling to marketers. I almost feel like if we didn't do one last kind of going out of business, again, digital marketers not going out of business, but if we didn't do one last sale, I feel like it would utterly invalidate us as marketers.
And that's what I'm trying to explain is like, would it have been better if we just took them off the market and didn't tell anybody? Then we'd have people pissed off that they didn't get a chance to buy it last minute. Come on.
What are we going to do in sales this last push? I don't want to give a specific number, but it's been in the hundreds of thousands of dollars in revenue, which is, again, if you were to look, that's what we used to do off of a single new certification launch over the course of a week or so. Is there a paid traffic to this?
Is it all organic from your LinkedIn post? It's all mailing our own list. I did a post on LinkedIn and Facebook about it, but that was really just more to kind of explain what, well, okay, I'll tell you the main reason why I did that post.
We were going to send an email to the list that was explaining what we were doing and why we were doing it. Our email marketing manager decided that he wasn't going to send the entirety of the email. There was like a two line explanation and then a link.
And then below it was a much longer explanation. And he's like, all this stuff below it, I'm afraid that's going to really reduce the click through rate. So he just took it out.
And it was basically like two lines. And then we're pivoting, we're changing, Ryan's retiring, here's a link. And it sent everybody over to the page.
And I was like, oh my gosh, this is incredibly uncool. Like this is a kind of serious thing. And so I felt like I needed to address it myself.
And so I went and made the post because I was embarrassed by the email that went out. And then we actually changed the page and moved the information at the top. That was the reason I did it in the beginning.
Was he right about the click-through rate on the email? Almost certainly, but we still don't do that crap. Yeah, I wanted to kill him.
And he knows that. It was the smart business thing, but it wasn't the human thing. The story part, like I need to explain to you what's going on.
Correct. Yeah. That is an important thing about marketing.
You can optimize yourself if you just pursue optimization. you will optimize yourself into the ultimate asshole corner, like every single time. Like if of all you do, at some point you have to take a step back and say, yeah, but what's the right thing?
And I freely admit that that line isn't always clear to everybody and people are going to draw that line at different places. But I feel like that where he drew it wasn't where I would draw it. All right.
So what's the pivot? You got a couple hundred thousand dollars in the war chest on top of what you're already doing. We're moving to a different space.
Where are you moving? The realization that I've had is we have some pretty phenomenal content. We have some phenomenal courses.
We have some really great frameworks and models and intellectual property. And for the past 15 years, we've been utilizing this to try to train humans. And I believe what at least the next few years is going to be about is utilizing this to train AI so that AI can do the work for humans.
And the way that I figured this out is I actually myself bought a course. I buy a lot of courses. I go through a lot of content and I bought this course and I didn't have time to go through it.
I was busy like everybody else. And there was six hours worth of videos, something like that. I'm like, God dang it, I don't have time to go through all these videos.
So I had my assistant log in and run them through Rev.com to get the transcripts. And then I posted up all the transcripts to ChatGPT along with the worksheets. And I said, I need you to learn all these so that you can become an expert on this topic.
And then let's go through it together so we can produce the output that this course is intended to produce. So that happened. And within about 30 minutes, I had the finished thing.
And now that conversation just lives in my chat GPT as just an expert in that particular subject matter. And I will still go in anytime there's something related to that topic. I will teach it.
to that. It's become a project now inside of chat GPT. And so I realized like, this is it.
Why are we teaching these things to people who number one, they're not going to watch the freaking videos. We all know that course consumption rate is tragically low and course implementation rate is even worse. So we can solve for this by saying, you don't have to go through it.
You don't have to learn this stuff because the AI already did. Let's just ask you some questions, get the basic information that we need. Let's get the first 10% from you.
The AI is then going to do the next 80% and it's going to give it back to you. And then you're going to need to put some spit and polish on it to get it where it needs to go. And so that's the 10, 80, 10, 10% inputs from the user, from the client.
AI doing the 80% of the work, and then the next 80% is the humans, the second type of AI, the actual intelligence, Helping to optimize it and release it so we're calling this AI squared because it's artificial intelligence multiplied by actual intelligence And so digital marketers pivoting into AI enabled services where we're basically taking every course every training that we've done training bots and agents and Instead of asking people to learn how to do this stuff. We're just gonna help them get the stuff done not as an agency as a company that's just helping to more... I guess it's a little bit coaching.
I don't know exactly how to describe it yet. Again, we're just figuring this stuff out as we go. But our first offering, what does everybody want?
They want leads. So the first thing that we're going to do is help them build out a lead funnel based on what we know works. And they tell us the first 10%, we'll deliver all the assets to them.
We've got phenomenal coaches, marketing coaches and experts within our community that can help to optimize it. And We're really, really excited about that. This is something we've heard other people say in terms of information is the race to the bottom, that we should not hoard the information.
We should share it to build authority and to build our brand. And we charge people for implementation. Now, if you're into implementation, that means a big team.
It means a lot of overhead and headaches with managing people. And it doesn't seem very attractive or sexy. But if you build a bunch of robots who can help people with implementation, you can do this at scale, which then makes it affordable.
But it also means you don't have to manage a whole lot of humans. And you can get a pretty consistent interaction or a user experience because the robot behaves the same way in theory for each person versus the personalities, the whims and the mood swings that they go through. So we're building similar things.
So this sounds super exciting. you can help people figure stuff out because and you're right the actual number of people who actually enroll in a course and implement any of the ideas that you share with them is very very low and that's why people are probably burnt out on courses because they just don't understand their own nature, which is not to do it just to buy it. And then they feel dissatisfied with the product, even though they haven't done the work.
I think that much of my success comes from actually consuming and doing the work, but I know how hard it is. We're going to be playing with to what degree do we do it for the clients. So in some cases, we're giving them access to our bots.
Here's our bots. They're going to do this stuff for you. In other cases, they're going to talk to our humans and our humans will interface with the clients.
So figuring out the right, what's that right balance of human to human connection versus human to AI. I think that that's going to be a fun thing to figure out, but you're absolutely right. Like we're able to take a service that realistically would have taken probably eight to 12 weeks to deliver the assets on.
And we can now do it in a matter of days. There'll be no more courses for sale, but there'll be information where people can sign up for our different, we're calling them AI2 accelerators. Because the AI squared, so that's we'll have one on leads, one on building a buyer funnel, and we'll just keep cranking out what's the thing that you want?
You want more leads? We got a thing that'll get you more leads. You got leads, but you want buyers?
Cool, we've got that. You want to systemize this? We've got that.
Everything is output focused because I'll tell you right now, whether you're doing anything AI related, Anytime people get scared, what they want to buy is certainty of outcome more than anything else. During the heyday, the hoopla, when everything is up and to the right, interest rates are at 0% and the government's giving everybody free money, they'll join open-ended programs. They'll sign up for coaching programs, masterminds.
They'll buy courses that they don't really know what they're going to get because it's just everything's opportunity and fun and it's going to work out. In times like these when things get tight and a little bit scary, People will invest, but they want certainty of outcome. So anything that you're offering selling right now, if you can make sure that you can deliver certainty of outcome and you can tighten the timeframe of delivery, that's really going to improve your conversion rates.
Would you consider leaving the bundle, the mega bundle of courses and certifications up on a secret URL where some people can have access to? Like, for example, when this episode airs, or is it like it's done, it's done? I'm sensitive to it because people have like, this is one of those things where it was kind of an emotional thing for me to decide that I wasn't going to produce any courses.
And then everybody's like, oh, you're just using this as a gimmick. And I'm like, screw you, man. I cried about this.
So yeah, there's a way that we can do a cool just for your people. I would like to, because I don't, like I said, I'm proud of them. But yeah, it would have to be like mega, super, ultra secret.
Like they'd have to like request it in some way, not just like an open link on YouTube or something. Let me do my quick recap. of the eight or nine things I wrote down in terms of what I've learned so far.
Okay, number one, sell first. Sell it before you make the product. Don't worry about that part because the first problem is to find a client and you can overcome your feelings of imposter syndrome or fraudulent activities by just being super transparent and owning it.
In this case, Ryan says, I'm new to this. I don't know what I'm doing, but I'd love to help you. And I guarantee you it won't be the best, but it'll be the cheapest that you can get it for.
And I'm willing to work my butt off. Number two is if you're not sure about what you're doing, have a backup plan. This is another piece of evidence on who you know, not what you know, because somewhere in your network is someone who knows how to do what it is that you're struggling to do.
And as long as you got a willing client to allow you to do what you need to do, you can do this and you can make up for the rest of it, your knowledge gap with sweat equity. And that's total okay. Next thing is to learn this lesson.
It's not what you do, it's who you serve. So in the case of the lactation consultant, that's a very finite thing. But what the woman who created this program was really interested in the welfare of children and how we feed them throughout their different ages and how they grow.
And so if you start to look at the bigger picture and understand who you serve, you can create a whole ecosystem of products and services, not just a product. What I love about what you've done here and lesson number four is don't be married to what it is that you do because it blinds you to opportunities. You're studying corporate communications, but hey, there's this thing that's new.
It's called web design. Oh, wait, it's not web design. I'm actually marketing.
Wait, wait, I'm not doing that. I'm publishing. And that's really cool.
You've been very fluid. And so now you're moving to this phase of agents and AI to help people's implementation because that's where the puck is going. This whole thing about don't copy somebody's intellectual property, but if you do make up with them because you can still build a long relationship.
So although you accidentally use the for dummies trademark, you actually now have a for dummies ebook or something like that or book. Okay. Number six, constraints can be a gift.
Your lack of knowledge, your lack of resources, your lack of network, it actually can be a gift because it It forces you to be scrappy, to be responsible, and sometimes, and venture capitalists know this, having money is not the problem. Sometimes having money is the problem. Number seven, it's better not to seek the opinions of "experts" because experts know too much.
They fall into patterns of dogma, what can and can't be done. They're oftentimes blinded by new opportunities. And so if you seek opinions too early, it may just very well kill your business.
Number eight. Share everything, share it openly, do it out of the good will of your own heart and you'll build an amazing community around you. And you can build a really strong brand and become the de facto standard expert of whatever industry you're in.
And last one, which you just mentioned, which is number nine, self-certainty of outcome and emphasize the time to outcome. Shorten that if you can, you're going to do really well. Those are the nine things I've just learned from talking to Ryan Dice.
And I tell you what, I think this is a perfect segue to prompt our audience to let us know what it is you want to learn about from Ryan. And then we'll do a follow-up episode. Now, I want to ask you this question, Ryan, because I did read this or either maybe you just told this to me where you think business is business, marketing is marketing.
Not a lot has changed. So the question I'd like to ask you is this, because people don't believe it. when you say things like this because like no my nature is different all the times are different everything's different or customers buy differently yeah those are variables but the core principles are the same we're not reinventing how to do business as we go up from year to year because those principles are the same so what are the three core either business or marketing principles that you think are evergreen that are never going to change maybe that's what we can talk about right now well the singular core marketing principle that I return to over and over and over again is you're really only ever selling one of two things.
And that is you're selling transformation or identity reinforcement. And it's essential that you know which you're selling because very often marketers will want to mimic brands that they respect and they love because they look so cool and they look so slick and they look so pretty. And those brands are selling identity reinforcement.
not transformation. So most of your high-end luxury brands, what they're actually selling is, "Hey, you perceive yourself to be very kind of hip and cool and with it and an individual. Well, you should buy an Apple product." I love the fact that Apple, all the way going back to their 1984 ad, which only ran once during the Super Bowl, since then, all they've ever been doing is selling us our own individuality.
And now they're one of the most pervasive products on earth. And yet, if we perceive ourselves to be an individual, if we perceive ourselves to be kind of high, we want to have an Apple product, right? So Apple is selling identity reinforcement.
You name the luxury brand, they're selling identity reinforcement. If what you're selling is transformation, don't mimic identity reinforcement brands in your marketing. If you're selling transformation, then what you need to get crystal clear on is what is your ideal client's before state and what is their after state?
The before state, where are they right now? And that is determined typically in five ways. So what do they have before And then what do they have after or what don't they have before?
And what do they have after? If it's a weight loss product before I have a lot of fat around my midsection after I don't have as much fat. Okay.
So have is the, is the kind of top level. It's the easiest one. Next level down, we have feel.
So what is their feeling like their emotional state before versus after? Next level down, it's average day. What's their average day?
Can you describe a day in their life before versus a day in their life after? We've been told that we need to tell more stories in our marketing. The best story in the world to tell is a story of transformation from a less desirable before state to a more desirable after state.
The best stories in the world have an arc. And what is the arc? It's that.
So if you can get somebody to tell their story about how they were here and now they're there and what's sitting at the middle, your product That's going to be interesting. That's going to be compelling. Next level down is status.
Can you change someone's status? We were talking about digital marketer entering the certification space back in 2015. When we became certifications before anybody else did it, it wasn't just a course.
You didn't just take a course and now you knew something. We fundamentally changed your status. I think it was Napoleon that said men will fight long, hard, even die for a bit of colored ribbon.
This is status. And so how can I elevate my product to the point that it will actually change someone's status? If you tell somebody a story, you'll capture their attention.
If you can change the story that somebody tells about themselves, that's when you capture their heart. That's when they'll love you forever. The best brands in the world, the best marketing in the world, the best products in the world change the stories that people tell about themselves.
The last before and after is good versus evil. What is the big existential fight? And this one is admittedly the hardest.
This is kind of the most difficult one to pull off. I would argue Chick-fil-A, I think, does a really good job with this. If you think that Chick-fil-A is merely selling chicken, they're not.
They are selling chicken with a heaping, helping, of wholesomeness. And when they say we're closed on Sundays, it's pretty obvious the existential good versus evil that they're up against, that they're fighting for. And most of the brands that we love really have that.
But if you look close enough and you will plot brands and marketing based on that framework, have, feel, average day, status, good versus evil, what is it like before? What can we deliver after? And if you will simply incorporate those transformational statements in your marketing and the further down you can go, because have is just features.
Feel is a little bit getting into kind of benefits. If you can push it down, that's when it becomes the most powerful. So to me, when it comes to marketing, that core principle.
And then the last one is just he or she who's able and willing to spend the most to acquire a customer wins. If I've got those two things in mind, Those have served me well for 25 years. For reference, how much are you willing to spend to buy a customer?
I'm willing to spend typically 80% of their 30-day value. Wow. That number's blowing my mind right now.
Two reasons. One, because data is imperfect and usually it misses some sales that you got. So if it says that it's 80% and you're using like Google Analytics, it's probably closer to 100%.
Two, if it's 80% at 30 days, then if I've got any backend, any follow-up, any upsells at all, I should be at break even by day 60. And in most of the businesses that we're in, if I can just get a 60 day float, we can make that work. Now it's not where I want to start necessarily.
Where I want to start is breakeven or better in the first like 14 days, because now what I can do is turn my cash faster. And at scale, all businesses become two things. They become banks and they become recruitment firms.
That's what they all become because those become the, how do we allocate our capital? And how do we just get more humans in the door to run these things? The second is going to change a lot with the emergence of AI, because you're not going to have to recruit quite as many people to keep it going.
But the how do we allocate our capital, that's always going to be there. And so marketing at scale really starts to look more like finance. where you're saying, okay, where do we put this to get the highest return?
And it's less about ROI when you're allocating your spend. And I'm sorry, I know I'm like vomiting so we can go back and double click on any of these. When you're allocating your spend from a paid media perspective, don't allocate it based on what gets you the most ROI.
allocate it based on what gets you the return on ad spend the fastest. Which channels get you the return on ad spend the fastest? Because then I can put it back to work.
There's a reason that Costco works even though they got such low margins. One is the fact that they charge a membership fee. That's actually all their margin.
But the second is that they've got such quick turns. Stuff goes on the shelf and then it's gone. So if I can have razor thin margins, if I've got high inventory turn, The same is true with your media spend.
If I go out there and this has only got 10%, I'm only making like 10% on this, but I'm making it every day. That's way better than, oh, I'm making two to one return on ad spend on this, but it takes a year. See what I'm saying?
So it's how quickly can we get these dollars back so we can put them back to work. Those are some of the other, since you asked about big principles that we're looking at, those are some of the other big principles that we look at to kind of guide these things. - The one I want to circle back to is this idea that you're willing to spend, almost break even in terms of the product itself and think about getting to break even around 60 days.
And you said, not at the beginning, but at a point because you can scale that, you can grow that, and now you know it works. Now, in my silly conservative mind, I was like, I have $100 product. Oh, let's spend 30%.
And then some ad consultant was telling us, if you're spending anything less than 50%, you're doing great. But 50% would be the limit. Now you're telling me it's 80% to 100%.
Okay, I need to sit on this. I need to process this one. But I know that there are a lot of creatives out there who are spending 0% to acquire a customer.
They just think it's going to happen magically. And that's probably why they're in the low six figures at that. because they're thinking about money differently.
I have this question to ask of you or ask you right now, which is, what is it about your background, your upbringing, that you have this relationship with money that maybe a lot of creative people don't have? Well, I didn't grow up with money. I grew up lower middle class.
Mom was a school teacher. Dad was an electrician. They were divorced, but I never went without.
But from an early age, I mean, I remember my best friend growing up, he would make like origami stuff and I'd be like, we can sell that. And so For me, I don't want flashy things. I don't have flashy cars and stuff, but I've always liked the idea of making money.
For me, it was a fun way to keep score and to know that I'm putting something out there that has value. That is the ultimate sign that you're delivering value. And profit is the ultimate sign that you're both delivering value and running a business well.
So you got two sides of that coin because there's lots of people who are doing a very good job of putting value out into the world, but they're not doing a good job of doing that effectively or efficiently. So not enough is returning back to them to where they can keep that flywheel going. And so while it may look very noble on the outset, they're going to burn out.
And so it's not going to work for very long. So I don't know exactly what it is. I think there's some people who just funny enough, I see to my youngest son, where he also wants money.
And we don't talk a lot about money. When we fly places, we flew to Europe, took the whole family to Europe. My wife and I flew first class, stuck the kids back in coach.
And they were like, "Why don't we get to sit up with you?" I'm like, "Because you're poor. Your mom and I do very well." They don't get spoiled. You know, I mean, I guess by most standards, we're all spoiled, but I'm not really sure.
I've just, to me, money was always a scorekeeping mechanism and I was always just as happy to give it away or send it out because it always had a way of coming back. Well, on the parenting note, I like that. I do the same thing with my kids.
I said, well, when you're paying for the ticket, you can buy whatever you want, but I'm paying for the ticket. So it's my money. And you can sit in the back until you're on your way.
I don't want you to get used to something you haven't earned yet. So earn it and happy to fly with you. Now, for record, I'm not even flying first class.
I'm flying business class, everybody. I'm not at Ryan Dice's level yet, but I do want to say something. Maybe this is a great way to end it because you said something at dinner that got everybody like raising their eyebrows like, huh?
I'm talking about first dinner together. We're at a restaurant, I guess it's post an event that we were all a part of. And you're sitting there and you had said something and you had said, you know what?
When you give away things and you never ask for anything, people will resent you. And I was like, huh, what? wait a minute and you had a story and you explained it do you know what story i'm talking about yeah i do yeah i mean it's a hard lesson that i had to learn and it's a lesson i think that every creator needs to learn so I do have an interesting relationship with money, but because I've always made money, I've always prided myself in picking up the tab.
And it's one of the rules that I have in life. If you have the opportunity to pick up the tab, you should pick up the tab. I just think it's a good gesture.
So I always try to do it whenever I can. So I would go out with high school friend, college friends, friends that I've known. We've known each other since we were kids, and I would always pick up the tab.
And they'd say, "Thank you." And this one friend, he'd say like, "Hey, let me get it this time." And I was like, "No, no, no, I got it. No, no, no, I got it." And then after a few of these in a row, he said, "No, let me get it. I'm really starting to resent the fact that you're never letting me pick up the tab.
It's like you think I can't afford it. Let me pick up the tab." And what I realized is that if all we do is give, give, give, give, give. And we never give the people who are giving to the opportunity to return to us.
That gratitude can turn into resentment pretty quickly because it just things get too out of balance. And so they can decide that they have such an overwhelming sense of gratitude and just live in this sense of gratitude into perpetuity. And that can just build, build, build, build, build.
But that's not really how humans work. We want to achieve some sense of balance. And so I do think it's important in our personal lives, definitely in business that go first.
So buy that first drink, pick up that first tab, send out that first piece of content. But by all means, at some point, give them the opportunity to give back to you. And so whether that means putting something out there that's a paid offering or letting a friend pick up the tab, give them a chance to come back to you or they're going to resent you.
i like this story because it's kind of counterintuitive it's contrarian and i am guilty of this thinking myself and it's really weird because i also like to ask and receive but for some reason when it comes to content just teach and like oh i just don't want to ask anybody don't buy my course it's just i bury it down there somewhere and i think for good natured, well-intentioned people, they do want to give back to you. Now, there are a couple of very selfish, narcissistic people who just think about themselves and they're takers and they're leeches. But we would not consider them friends.
So we're not going to have repeated dinners with them or anything. But if we're going out with people, it's really interesting what you're saying. People want to be able to give back.
They want to balance the scale in some regard, somehow. And I remember Simon Sinek was talking about this one time. He was telling a little story about how Where did money come from?
He explained it this way. He's like, you know what? Come over my house for dinner.
I'll make dinner. And the part of the agreement is you'll do the dishes. And that's it's working really well.
And then one day you're like, I have to run. I can't. I'm going to give you an IOU.
I'll do the dishes next time. And then eventually the IOU is traded for other people to like, oh, repair my roof. And that's where money comes from, because we're trading on the promise that we'll help each other out.
And that's kind of what it is. So if you don't give people the ability to say thank you or return the favor, never thought of this way. This was a mind shift for me.
Good reframe. They could grow to resent you. Like somehow you're holding power over them and you're not trying to.
I'm just trying to help. Right. You're trying to be a good guy.
It's not coming from a bad place, but you inhibit their ability to even the scales. And I just do want to say this. the times in which I've gotten together with you.
You've been super generous with your time, with your information, with the stories and everything, and with your money too. He walks the walk, guys. I will vouch for that, for sure.
He is a very generous guy in spirit and everything else. And so this giving attitude has led you to a ton of success. And I want to wish you from the bottom of my heart this next venture that you're going on, I'm sure it's going to be wildly successful.
And I think you see things before the rest of the herd sees it. And so you have to move quickly to be where the puck is going. And I can't wait to catch up with you and talk about how that's become wildly successful and how you've cracked the puzzle once again.
Well, it'll be fun to look back on this and see how much of this came true or how much of it we're like, holy crap, what was I thinking then? So we'll definitely have to do a flashback episode or something like that to see how it all worked out. But I can't appreciate enough the conversation and your friendship.
And yeah, thank you. Thank you, Ryan. Thanks for being a guest.
Thanks for sharing so openly. I do want to say this to you in that voice, maybe that your wife said to you, and maybe I'm saying it to myself and to our audience. You've been here a thousand times before.
You've always figured it out. And you're like a cat, you land on your feet. So these momentary setbacks are meant to teach us a lesson and to show us the path towards something that's bigger and better.
And as long as you don't give up, you will find that way. And I'm excited for you, even though we're just at the beginning of the next arc. Amen.
Amen.
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