When I first started out in business, I had invested heavily in my own sales education. I researched what was considered to be the best place to gain practical sales training, and my research at that time indicated two companies that stood head and shoulders above the rest when it came to sales training. I think it was the day the penny dropped with this part of the process that made the most difference to me personally.
To be frank, I was unable to determine which one of the two I should invest my time in to gain the best possible sales training, so I took the only option that I could think of that would give me what I wanted. I used both companies one after the other to get the best of both worlds.
Interestingly neither talked about the Hook, story and offer; they preferred to focus on features, advantages and benefits. Later I would strike up a friendship with an American sales Guru, and I cannot begin to explain how much value I gained from that relationship; it even led to the production of my own books, Sales Alchemy and Making Rain. Still, there was no mention of the power and importance of the Hook, story and offer. If we turn the clock forward to about 2008, this was when I learnt this vital technique that I want to share with you now.
Some of you will already know the story of the business I was building then and how we turned it around in just three years, from doing about £100k in sales for the year to about £1.3m per month. The methods used would later become the content for the book The 7C’s Of Why; within this was the revelation of creating value ladders and sales funnels that were all based on Hook, followed by a Story and then a great Offer. But not just any hook, not just any story and not any old offer. The relationship between these and the relevance to your ideal customer is key, as is ensuring that you are delivering significant value for money all of the time.
The subject of Price
Often during this stage of development, I am asked about pricing; some can really struggle to get this right. We are all taught the same thing, don’t be too cheap, don’t be too expensive. If you are too high, people will not buy if you go too low, you won’t be taken seriously. Once again, I find myself making my own path and not listening to the tribe but innovating and concentrating on the people over the fashionable answers.
It is a given that your pricing needs to be sensible and, of course, not put you in harm’s way, but there is another consideration that I urge you all to consider, and that is simply the following:
When you design the pricing, the best way to be competitive is to focus on the value of your offer, not just the Price. We all want to be more competitive, and there are only two ways to get the best Price. The most obvious one is to have the lower Price, but this will cut into margins and profit and can also be the catalyst for a mini price war with your direct and, in some cases, indirect competition. When it comes to a price war, the business with the most money will win because it will have the ability to sustain lower prices for longer. Another problem with low pricing is the expectation you create with your marketplace.
In my view, the second option is far more sensible and sustainable, and that is to have the best Price based on value. The more value you can give, the better value for money you create. For me, that is the only way forward. When you create more value, the Price you select seems to the market to be less expensive. It is certainly worth some thought. Creating more value is easily achieved with a well-thought-out and executed value ladder.
Here is an example, if I provide a course for £100 and my competition provides a similar offer. Still, they do not have a value ladder for this service; I will have the advantage because I can offer more value through my value ladder, which will take full advantage of the by-products produced as a result of designing the course I am selling. To make this a little clearer, I have designed the illustrations below:
There are two main points I want to explain regarding this first illustration that will endorse the real advantages of using the Value Ladder model in your business and how it interacts with the Hook, Story, and Offer shape of the content.
- If you talk to 100 people in your target market about your product or service, they jump from zero to the hero product in one step. For some, this will be fine, but what happens to all the others that are either not ready or don’t see the need at this time? For those, the journey is over, which gives your competition the opportunity to offer an alternative. If five say yes, you will feel great, but what if you could have turned another 15 to 20 into clients by offering something a little further down the arrow? Not only do you gain more revenue, but some of those lesser sales will result in purchasing the Hero product too. In this way, you are increasing your success and helping more people.
- If you break your Hero offering down into component parts and give some of it away or for a small price and then offer a discount for the Hero to those same people, you are creating much greater value for all, and that is where you build part of your differential. I will explain this in more detail below:
Several stages took place when this Hero product was designed; the product didn’t just arrive. It was designed, and the by-product was several component parts; traditionally, many will not consider this fact and simply focus on the finished complete product or service. What I am suggesting is you think differently in this regard. This is where you can start to stand out from the crowd, rather than following what most do. In this example, to build the hero product, the designer of the business went through the process of creating a script to explain the business and then scripts for the technical and operational information, and that led to a short e-book that would help customers to get the best value from the product and service, in turn, that lead to the development of presentations, Tips and Hints, as well as a database of frequently asked questions. The key is to recognise these for what they are, not just components for the Hero product or service but components that can be adjusted to stand alone for lower value sales, one-time offers, special offers and giveaway items to encourage elevation up the value ladder toward the ultimate sale. Even those that do not elevate to the ultimate sale will have still gained benefit from you, and you form them! This then creates an almost perfect win, win relationship.
If you look at the completed example value ladder above, which now includes the sales funnel (we will look at funnels in some detail later in this resource), you will see how this business owner then took these components and incorporated them into their Value Ladder and then linked them together to create a customer journey that could start at any point and still create significant value while catering for Cold, warm, and Hot leads generated by the funnels. Typically when it comes to the price, these increase as you rise up the Value Ladder and in some cases, the bottom step is often a free or low-price offer. A low price does not mean low value to the customer. Remember, we want to create much greater value than our direct competition.
A quick note on our interpretation of ‘Cold, Warm & Hot leads
When we are referring to Cold leads, we define these as people who do not know us, do not follow us and have yet to purchase or take advantage of our offers within the Value Ladder.
When we refer to Warm, these are people who follow us, and we have some form of existing relationship with them, but they have not yet purchased or downloaded anything.
Hot leads are those who have purchased something from our Value Ladder, and we are in contact with them due to that purchase.
Back to Hook, Story, Offer
It is very important at this stage that you know exactly who your ideal client is; the people you want to serve. You should also take time to understand where these ideal customers congregate online. I will make the assumption you have already done this work, and so now you will need to decide on the incentive you want to use to get your ideal client onto the value ladder and into your funnels. We will look at these in detail later, but it is worth noting that you will be using Hook, Story, and Offer at every level of your ladder and the associated funnels; this includes the PPC and other adverts you might use if your business is ready for them, the emails you send and the landing pages you use.
Inspire action with a great offer
You most likely already have a product or service in operation, and if you are involved with this particular course, then it is a fair bet that you are looking to sell more online. You may even be just starting out, where you’re here to learn how to get your online sales started at a volume and frequency that will turn profits as soon as possible. In most cases, what you are selling or providing can be got elsewhere in some form or other; therefore, it is vital that you find a way of putting your own unique spin on your offering so that you can stand out from the rest and get the attention of your target market.
Restructure what you sell via the value ladder and turn it into an offer. Base this on the objective of creating more value than your competition so that you no longer need to compete based on price. So let me make it clear the objective is to do the following:
- Increase the perceived value of your offering.
- Create a differential in this way so that what you are offering is unique to you.
- Whenever possible, link this to a special offer.
The value of your offer is increased when you take the time to break it down into its component parts. So, for example, if you are selling something for, say, £250, show how the true value is actually far greater, for example, £1,000. As a rule of thumb, if you operate in this way and you encounter resistance on price, this will probably not be related to the ability to afford but the value placed on the offer being made.
It is worth giving this the appropriate amount of thought; what could you create to include inside your offer to increase its value? When I do this, I often use a whiteboard and brainstorm; this is the best way to encourage new innovations and creative ideas. In the Rainmakers Club, we encourage you to interact with your fellow members in the appropriate groups to help with this process. That is certainly one of the strengths of our model.
Story
Ultimately we all want to sell something. Regardless of what it is and its motivation, we all want to sell. The issue is that so does everyone else in our space, and so we need to be doing something better, or perhaps differently and in a way that is creating more value for the end user. The issue I see personally daily is the preoccupation with the sale of the product and not enough thought on that process and how it will work for you the best.
If you focus on the product and service only, in other words, just the features and benefits, you will get make some sales, but you can make significantly more sales if you embrace the fact that stories work best in a sales environment. This is particularly true when it comes to the Hook Story Offer model. If you simply list all the things in your offer, this will not get the same attention as it will if the offer is backed up with a supporting story that will resonate. Please do not interpret stories as being fiction. That is not what I am advocating; stories should be true and based on what you have learned or earned along the way.
So the story should directly relate to the offer. For example, if you take a look at one of our offers, you will see that they are all, in fact, directly related to my own experience and learning. I often tell the story of how frustrated I became when starting out and what I learned along the way that resulted in the design and launch of the Rainmakers Club and, after that, the Rainmakers Hub. I also share the story of how I took one business from just under £100k sales turnover to £1.3m in new sales per month in just three years, using the same model which lies at the core of everything we do today. It is that same model which I share today with our members, or at least the ones who want to listen and learn. Learning the story behind the offer will help to increase the perceived value of that offer to the person considering the purchase. Making it relevant to them is really important to gain that increase in sales you look for. In my story, I am not just making the offer; I am illustrating how, by using the same model, I was able to significantly grow sales in my own business.
The process is simple; when they have heard the story, it helps to build the relationship and trust in the process that forms the offer that they have been presented with. That, in turn, helps to increase the perceived value of the offer. Stories can be used in this way for every step on the Value ladder and every funnel associated with it.
The Hook
Each day people are throwing out hundreds of hooks to see if they can grab your attention and tell you their story. The hooks are the headlines, the images and the videos you put in front of your dream customers where they are meeting or if you prefer congregating. The hook is a component and has little value without the story and the offer that will be made.
The key is to understand that you have hundreds of options to choose from when it comes to throwing out your own hooks. The secret is to keep going until you find the right bait. When your hook works, do not take I for granted; you need to keep working and keep developing new hooks to renew interest and extend your reach.