LIVE: The Real Secret Behind The Value Ladder

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---Transcript---

Hey, what's up everybody. This is Russell Brunson, and we are trying out something really fun and new and exciting for the Marketing Secrets podcast and so wanted to tell you about it. So I did an episode that was actually live, we called it the Marketing Secrets Live Show and we did it on Clubhouse. And instead of me just talking for 15, 20 minutes, like a typical podcast, I did talk for 15, 20 minutes and at the end of it, I opened it for Q&A, we spent about 40 minutes on doing Q&A and it was a really cool experience for so many reasons.

One was a chance to answer questions for a bunch of you guys. Number two is just it was fun doing it live and the energy was cool. So I think we're going to keep on doing it and want to invite you if you want to come on any of our live shows. All you do is go to clubhousewithrussell.com. It's clubhousewithrussell.com. It redirects you to the Marketing Secrets Live clubhouse room and you can join that room and then you'll be notified when we go live. I'll probably go live once a week or so and again, I'll be spending 15, 20 minutes talking and then after that, we'll go into Q&A and it'll be fun.

So the next episode's going to be special. The first one is going to be my 15 to 20 minutes of me talking about the concept I want to talk about that day and the next step episode I'll share with you is the Q&A, and I hope you enjoy both sides of it and hopefully gets you pumped to come to the next Marketing Secrets Live show. Again, it'll be on Clubhouse, so make sure you get the Clubhouse app.

But again, if you go to clubhousewithrussell.com, you can register. And with that said, I'm going to pick up at the very beginning of the Live Clubhouse and we'll go from there.

We're here, everybody. What's up. This is our, technically it's the second time I've gone live on the platform. First time was a huge train wreck, we'll talk about that in a minute, but this is round two and I'm here. And Yhennifer, how are you feeling today?

Yhennifer:
I am feeling amazing, so excited to be here. I know that we were on for the funnel hacking live room and it was bananas. So I know that this one is also going to be amazing. Don't forget to make me a moderator real quick.

Russell:
You're officially now a moderator.

Yhennifer:
Awesome. There we go. I got the badge. I made it in the world.

Russell:
Amazing. I'm learning how to use it all. Okay. Can you hear me well? This is my first time using the setup and everything, I want to make sure you can hear me.

Yhennifer:
Yes, we can hear you perfectly fine. Welcome everybody.

Russell:
Welcome. Welcome. All right. Well, let me, while waiting for a few more people to jump on here for a second, I'll tell you guys what the game plan is, what we're trying to do here and then we'll dive into it. So we're going to be live for about an hour for about an hour and this is my second time officially using Clubhouse. I've been in Clubhouse a lot as a guest and hanging out, but the second time didn't get a room. First time I tried to do a room, did not know what I was doing, jumped in there. I brought everybody up to become speakers and it was chaos and anyway, it was kind of crazy. So I stepped back from it and was like, okay, I want to do this again but I want to do it this time a little more strategically.

And so the game plan for what we're going to do is I'm going to basically be doing an episode of the Marketing Secrets podcast. So I'm going to talk for probably 15 minutes or so on a topic and then when that's done, Yhennifer is going to be my amazing, co-host, help me with this whole process, making sure I don't mess it up. Then we're going to bring you guys up, whoever wants to come up and ask questions or give comments or share things to deepen what we're talking about with everybody else. And that's the plan, so I think it should be fun. Anything I'm forgetting?

Yhennifer:
Yes. Make sure that you pin some people into this room. You have that little plus sign at the bottom guys, as you are hopping on here. Invite some friends that will be interested in what we're going to be talking about today, which is the secret behind the value ladder.

Russell:
It's so fun. All right. And I've also got this really cool, I feel professional, I've got a little board here. I click buttons, and if I tell you guys a joke, check this out. Did you hear that?

Yhennifer:
That is amazing.

Russell:
So I can do that. If we talk about money, I can be like this. And I also got the theme song for the Marketing Secrets podcast loaded up here. So this is the live version of the Marketing Secrets podcast, which I'm pumped for, hopefully you guys are pumped for as well. Like I said, I got about 15 minutes of stuff I'm going to talk about and then we'll open up for Q&A's. And so that is the game plan. So again, if you want to invite anybody you know, please invite them and then what I'm going to do is I'm going to queue the theme song right now and then we'll play it and we'll come back at 15 minutes to talk and then we'll open the blinds for Q&A. Does that sound good?

Yhennifer:
Awesome. Let's get the party started guys.

Russell:
All right, with that said, here is the theme song.

All right, everybody. Welcome to our first ever official Marketing Secrets live show. I'm so excited to be here with you guys. We are doing this live on Clubhouse, which is kind of cool. This is my first time really producing something like this, and I'm excited.

So if anyone who is a listener to my podcast, you know that usually I spend about 15, 20 minutes talking about a topic and it ends there. I want to use this platform as a way for me to be able to talk about what I'm thinking about for next 15, 20 minutes and then, when it's finished, jump on with you guys and do Q and A and answer questions. Or if you guys want to share ideas or thoughts, whatever it is. It should be fun, so that's the game plan.

The thing I want to talk about today... We titled this one The Real Secret Behind The Value Ladder. I did it for a couple of reasons. Number one is the value ladder is probably one of the least understood principles inside of this marketing game. And it's funny, because I think when you explain it, it's really simple, and be like, "Oh, I get it. I get it."

But when I look at people's businesses, when they come in for consulting or they hire me for coaching or whatever it is, I look at it and some people have what we call a value maze, where there's 8 million different ways that a potential customer could go and it's confusing. And I'm like, "Where do you take a customer?" And they have all sorts of different things, right? I'm like, "Well, value maze is not a value ladder." So that's one thing. Where number two is like, "Oh, they have a product." They've got one thing and they're missing some of these, these key components.

And so I want to share with you guys really quickly what the value ladder is, but then there's a big thing that most people are missing. And it is key. It's the key to ascend somebody from one spot to the next in your value ladder. It's the key to actually serve people with the highest level of value. It's the key to really have success and help your customers have success.

And so, that's the stuff I want to talk about today. I'm going to geek out on this at a deeper level than I typically do because I'm hanging out with a bunch of people who are on Clubhouse. That means you guys are as nerdy as me if you're here with five minutes worth of warning that we're going live for marketing seminar, right?

And so that's kind of the game plan. So, and then after afterwards, like I said, we'll open for Q and A and do some questions. If you guys have any feedback or if you want to share your value ladders and things like that and how you transition people from step to step, that's game plan.

Okay. So, a couple of things. The value ladder right now is more important than anything I could talk to you about for a lot of reasons. One of the biggest ones is obviously with all of the changes happening in advertising between Apple and Facebook and their feud. I'm assuming that most of you guys have noticed that your cost per acquisition in most of your marketing campaigns, if you're buying ads on Facebook, have probably gone up. For a lot of you guys, it's gone up substantially, am I right? Okay.

If you've read the DotCom secrets book, one of the quotes that I talk about a lot from my mentor, Dan Kennedy, he said that whoever can spend the most money to acquire a customer wins. Okay? This is something that like... I don't have tattoos, but if I had a tattoo, it would be tattooed on my forearm so I would never forget this. This is how important it is, right? Whoever can spend the most money to acquire a customer wins.

I remember when I first got started in this game, I heard him say that and it didn't make any sense to me, okay? And I think a lot of you guys who have been in the market right now, playing this game for a couple of years, it's been easy if I'm completely honest. Facebook ads have made things easy and a lot of people made a lot of money without having to be really good entrepreneurs and really good marketers and really understanding things because it was easy. It was easy.

If any of you guys had a chance to read my newest book, my third book, Traffic Secrets, the intro of Traffic Secrets, that the title was, there's a storm coming. Some of you guys probably read that. It was right when Coronavirus hit is when the book launched. And I said, "There's a storm coming." It's been so simple for so many years and I've been doing this now... This is my 19th year in this business, so I was playing this game before Facebook, before MySpace... Actually, Friendster was the hot social network at the time when I started this game.

And so I've had a chance to see the ups and the downs and watch what happens to advertising platforms and networks over two decades now. I wanted to warn everybody, because so many people who have got in this game in the last few years where it was easy, where it's we focus on Facebook, and I'm like, "You guys have to understand there's a storm coming. We have to look at things differently. And if you're not, you're going to be in trouble."

I think the real first big wave of that has been hitting right now with the battle between Apple and Facebook and all the things. I've seen a lot of people who messaged me, who are freaking out, who'd be like, "Our ad costs are going up. What do we do? What do we do?" The reality is what you should do is you should be celebrating, okay? If you're an actual marketer, if you're a funnel hacker, if you're of our people, right? You've been hearing me preach this now for a decade, right? Whoever can spend the most money to acquire customer wins, right?

If you understand that, the fact that all the CPAs, the cost per acquisition, these costs are going up and it's getting more and more expensive should not scare you to death. It should make you excited because all it really means is that more and more people are going to fall out of the game. Okay? Less competition, less people, less people fighting over ad dollars, all those kind of things. It's going to drop, okay, because the real marketers are going to keep playing the game and the rest of them are going to disappear.

Like I said, I've been doing this now two decades. I've seen this. I've seen people who are making millions of dollars a month one day. And then, because of an algorithm shift, they're now out of business and I've never seen them come back, which blows my mind to this day, is because they didn't understand these core principles. And so, the core principle I want to drill into your guys' mind today is the concept of a value ladder, and then I'm going to show you guys the actual secret behind the value ladder. That's the key that makes this whole thing work, okay?

So the basics of the value ladders... If anyone who has been around me for more than five minutes, you've heard me talk about this before, so I'm not going to spend too much time on the actual value ladder, because that part's the most simple, but a value ladder is like... Somebody comes into your world, right? And you give them some value.

So my goal is... Obviously, there's a lot of free things I do online, right? My free podcast. I'm doing this live right now, right? Some of you guys are jumping into this room and this is the bottom of my value ladder, right? It didn't cost you any money, okay, but I'm providing value. Hopefully if I do a good job of it, you're going to be like, "Man, that Russell guy? He talks kind of fast, but I got some value that was really quick. What else does he have?" Right? And you naturally want more.

That's the cool thing about human beings. If we receive value of something, we naturally want more. So if you see cool video or podcast, or you're here on Clubhouse, or something, you get some value, you're going to start looking around. You're like, "Hey, Russell talked about that book. What was that book he said? Oh, DotCom Secrets, or Traffic Secrets." Whatever one grabs your attention, right? And you're going to go online and go to DotComSecrets.com. You go over there, and you're like, "There's the book. $9.95 shipping and handling." You're like, "Whoa, in the Clubhouse room, he spent an hour with us and that was amazing. Can you imagine what I would get if I actually read his book." Right?

You put your credit card in. You buy the book. Then you get the book and you start reading it, right? Now you're moving up my value ladder. You start reading the book and you're like, "Oh my gosh, this funnel thing is really, really cool. In this book, he talks about the 10 core funnels and how they work and, all of a sudden, I see how it could work in my business and I can see how it works in other people's..." And you start freaking out. You're like, "This is so amazing." Right? And you got value. You're like, "I paid 10 bucks and look at the value I got from this thing. This is insane, right?"

And then what happens? You naturally want more. You start looking. "What's the next thing? What else does Russell have?" Start looking around, and all of a sudden you're like, "Oh my gosh, Russell is doing this 2 Comma Club Live virtual event coming up in two weeks. I want to be part of that. What is that?" Okay. So you go, you sign up for the event, and I try to provide value first.

So the way that 2 Comma Club Live works is you put in your credit card and you go through the entire three-day experience for free. Then, afterwards, you decide if it's worth it, right? So there's no me trying to scam anybody out of money. It's like, look, come show up. I'm going to serve you like crazy, and at the end of it decide if it was worth it. If it is, then you can pay for. If not, then don't. Right?

So they come through, do 2 Comma Club Live Event, and they go through this experience for three days and they're learning, they're growing, and they're getting all this stuff. They're like, "This is amazing. I'm getting so much value from this. What else does he have?" Right? And then you look at Funnel Hacking Live, our big live event, or maybe it's our 2 Comma Club Coaching.

Or if you're inside of 2 Comma Club Coaching, after you've gone through that process, you're like, "What's next? I want the next thing." So, after you've gone through our 2 Comma Club Coaching program, it's a $25,000 program, our next tier up is my inner circle, right? And then after my inner circle, there's new program coming out called Category Kings.

And so this is my value ladder, right? It all starts with me coming out there and putting out as much value as possible and, if you like it, you're going to naturally want more. Okay? So that's kind of the concept of value ladder. Again, I don't want to go too much deeper than that because you can read about in the DotCom Secrets book, and I've talked about a lot of other places. That's the core concept I wanted to put out there. Right?

And so, the reason why these ads are changing, right? Ad costs are going up and everyone's freaking out. That's why this is so important because what will typically happen is most business owners... And I see this so much, even inside our funnel hacker community, unfortunately, is they create a product and have this product and it works really well and they start selling that product. Right now, because the game has been easy for the last four or five years, they spend $50 in ads. They make a $100. They're like, "Oh, this game works." Right?

But now with all these different changes, and the algorithm shifting, and the fight between Apple and Google and Facebook and things, now these costs are going up. Well, now you're spending a $100 to make $100. And then, it's eventually going to be $200 to make a $100, right? And all of the amateurs are starting to fall away, okay?

I remember my very first marketing seminar I ever went to, I heard Mike Lemon said... He said, "Amateurs focus on the front end." Said, "Amateurs focus on the front end." And I didn't know what that meant until I started getting into business and I started saying, "Oh my gosh, my first two or three tiers on my value ladder, all that money is going back into just paying for customers. It's not until tier three, four, five, I start actually making money."

And the deeper you can go into your value ladder without making any money, the more successful you're going to be, right? Because whoever can spend the most money to acquire a customer wins, according to Dan Kennedy, who is my mentor, and I trust everything my mentors say to me, so it's very, very true.

Okay. So I want to kind of start with that. Now, the next thing I want to talk is... Again, most of you guys at this point have some kind of value ladder, but the thing, and this is where I talked about the real secret behind the value ladder, the thing I really want to share with you guys today, and this is the nugget that hopefully you get and you're like, "Oh my gosh, I got value." And then we'll open up to take some Q and A's and stuff.

So the big secret is each tier of the value ladder, the thing that you sell at that tier has got two goals. Number one is to provide value, right? It's to scratch the itch they have, right? So you give them this thing that's like, "Oh my gosh, I got value. That was amazing. I scratched my itch." But usually when you solve one problem for somebody, it opens up a new problem. Right?

So, for example, when I give you a book on how to grow your company funnels, you like, "I read this book. I got value." And then, all the sudden, you're like, "Oh my gosh, I need a funnel." And then, hey, lo and behold, guess what I sell? I have this funnel software that I sell called ClickFunnels. You should use it, right?

And so it opens up the next thing. Each tier on the value ladder should provide value, help somebody at that tier, and then, and then by giving them that value, it should open up the next step, right? Because after you have a funnel, what do you need? Well, for me, you buy my first book. It's like, "Here's how to build a funnel." And then second book like, "Hey, here's how to do the messaging for your funnel." Third book's how to get traffic to your funnel. It moves somebody up and down.

So the first time I got this... Some of you guys know Chet Holmes. Chet Holmes passed away a few years ago. He wrote The Ultimate Sales Machine, which is still, to this day, one of my top 10 favorite business books. Chet actually became a friend of mine. I spent a lot of time with him in business and traveling, and just had a lot of respect for him. As I was working with him, he wanted us to help him with one part of their business. And so, because that, he opened up his books and showed me his entire business model, which was really, really cool.

So he showed me this entire business model, and I want to walk you guys through how it works. Because when he showed this to me, this is one of the first time I got it. That each step of my value ladder is selling the next thing.

So the way Chet's business model works is he runs radio ads, right? So he's running radio ads. In the radio ad, it would say, basically, "Call this number to get nine free reports," or something like that. So they'd run the radio ads. It would call the number. Someone would answer the phone, say, "Hey, what email address do you want to email your nine free reports to?" You give them an email address, cool. And said, "Hey, why have you on the line, Chet normally..."

He used to do these seminars that were three hours long. He would fly around the country and people would pay, I can't remember, $800 to come to these three hour long seminars to help them to grow their company. And because you're at home, we're doing virtual seminars, and how would you like to come to these virtual seminars?

And he said, the seminar for you guys, for virtual one, was $300, but the cool thing is you don't have to pay for it up front. You can come to the seminar, attend the entire thing, then after it's over, if you liked it, then you pay the $300. Right? And so that's how Chet's value ladder began. Okay? And so that's kind of where I got to dive in.

So I started going on these seminars. I wanted to understand what he was doing. And I'd watch this three hour long web seminar that they would run, and they would teach people and coach them show them all this amazing stuff. It was awesome. The three-hour training was worth the $300 bucks. And so, when the three hour training was done, at the end of it, he said, "Hey, really quick, I want to find out from all you guys. The last three hours, was it worth it? If it was, tell me, and if so, we'll bill you the agreed upon $297, like we agreed upon. But if not, let me know and we won't bill your credit card. Totally cool. No harm, no foul."

And he'd go person by person. These web classes would have like 10 people on a time. So he'd be like, "Joe, how was it for you? Was it good?" And then Joe would be like, "Yeah, it was awesome." Then he'd be like, "Cool. Sam, Julie, Mike..." And he'd go through everyone and get everybody to say yes, and they'd bill their credit cards.

And he said, "Okay, now that the seminar is over. It's officially over. Got all the value. Really quick. The biggest question people ask us after they go through this experience is, I want more. What's the next step? What's the next tier?" And he said, "Do you care if I spend a couple minutes talking about our six week long mentoring program where we can take these principles and help you instill them inside your business?" And of course, everyone's like, "Oh, sure, definitely."

And he walked and transitioned to the six week program and he explained it all. And then, from there, he would try to close every single person on the call on the six week program. Right? And so then that was the next step in the theater. And then you went through six week program. At the end of the six week program, they give them two bonus calls, right? And the two bonus calls are with the coach, trying to figure where they're at and where they're trying to get. And then, from there, the coach upsold them to the next program, to the higher ticket program.

And so, each tier in the value ladder provided value, provided the thing they promised. And the end of it, there was a mechanism, there was a tool, there was a process in place that then took that person and ascended them to the next tier inside the value ladder. Okay? That was the key. And as I started watching, I was like, "Oh my gosh, this is amazing."

And what Chet did in his business, it was really fascinating. This is kind of off topic, but just an idea to put in your guys' head. Every single person in Chet's organization, his entire company, everybody was paid a percentage of the sale. So what would happen is that the person buying the radio ads, he or she would get a percentage of the money that came from the webinar one, and then from the six week program, and all the way through the entire line, so they all were incentivized.

The person in sales on the webinar got incentivized on everything that happened after that person touched them, and so on and so forth. The way he structured it... I remember him sitting there. He said, "Russell, this is the secret to business. Don't have tons of overhead. It'll drown you." He said, "You got to set up your structure so that everybody's paid based on a percentage of commission." He's like, "That way, when you have big months, everyone gets big checks and small months, everyone get small checks, but we all do it together. That way you're not stuck with the overhead and things." Unfortunately, I didn't use that in ClickFunnels. I wish I would have. If I get all 400 employees that work here to... I'm just joking, but it was really just a cool thing.

So this was the secret to value ladder that Chet taught me, is that each tier in the value ladder, part of the product, part of the thing that they're buying, actually ascends them to the next tier. Okay? There's a good way and a bad way to do this, too. I've seen this in the past, when I've bought somebody's book, where I'm like, I see the book, the ad's awesome. I buy the book and I read it, and the entire book is a sales letter for their next thing. I hate that. That drives me crazy.

But if you look at my process, I want to blow people's minds. So if you go through it and you read the DotCom Secrets book, you'll notice that the entire book, like whatever 297 pages, is just pure strategy, tactics, like nothing. And at the end of it, there's a little chapter on, "Hey, if you need a tool to help this, it's called ClickFunnels." And we push them to ClickFunnels, right?

And then there's a sequence after they buy the book. There's a whole marketing sequence that gets somebody from there to the next tier in our value ladder. Right? Then if someone comes to 2 Comma Club Live event, right? It's a virtual event. It's three days long. They go through the process. And inside of that event, that is the mechanism where we sell our 2 Comma Club X Coaching program, right? And so they go to that and they join 2 Comma Club X, okay? And in the past, I had an inner circle and my Category Kings, which has been closed for about two years now, but I'm going to sprinkle some hints here. I'm actually reopening those here this year, which is exciting. And so what's cool about it is then people inside 2 Comma Club X, they can then naturally ascend up the next year. And then people inside of the inner circle then can naturally ascend up our Category Kings.

And so there's a process in place, but everything is designed and structured around knowing that I've got to give them the value I promise them, but then, at the end of it, there's some mechanism that moves them to the next tier, that moves them up the value ladder. Okay? That's the power. That's the real secret behind the values. Not just having a value ladder of, oh, there's a product here, product here, product here. It's structuring your product so that the product does the selling to move somebody to the next tier. Okay?

If you guys come to Funnel Hacking Live, you will notice something. Most of our speakers, not all of them, but most of them are people who are in my inner circle. They are in our 2 Comma Club X Coaching program, things like that. And so, as we introduce them, we're like, "Hey, here's 2 Comma Club X Coaching member, so-and-so."

And so they see this and people see over and over and over again, that the people who are on stage are the people in the next program higher, and it gives people incentive to want to go and ascend up and move up the value ladder. Does that make sense?

So these are just some of the things, but that's the real secret in value ladder is structuring your products in a way that, number one, gives so much value that they want to ascend up, and number two, there should be mechanisms built inside of each tier that actually physically move them to the next tier. Okay?

You get Chet Holmes on his free web class at the beginning. At the end of it, pushed them into six week program. In the six week program, he had two bonuses coaching calls. Those coaching calls were then there to send them to the next tier and so on and so forth.

And so, that's kind of the process of what a value ladder is. But, again, this is the piece I wanted you guys to get. The real secret is understanding that. Creating tons of value and building the mechanism to actually get somebody to ascend to the next tier.