Hello fabulous entrepreneur, it’s Tash Corbin here, and welcome to day 5 of Tashmas! If we were singing the 5 days of Tashmas this would be 5 gold rings, and what I’m talking about today is pretty golden. I wanted to break down one of the big strategy ideas that seems to get legs and become really popular every few months in the online business world, particularly in the ladyposse.
It’s something that we talk about in the Heart-centred Business Academy and I wanted to bring that conversation out so that we can have it with the broader audience. There’s also a really sexy limited space free offer for a lot of you as well, so let’s get into day 5. I want to talk about paid lead magnets.
This is a little complex so I want to explain what it is first before I talk about the concept of it and whether it’s going to work for you or not
A paid lead magnet is similar to a lead magnet, but people pay you an amount for it. There are lots of different strategies in using a paid lead magnet, some are called tripwires, or a low-cost introductory offer, but what it is, is where the first thing someone does with you when they arrive in your world is paying you a small nominal amount of money.
You may have had this before where you’ve signed up to get someones free ebook, and then they’ve offered you the planning workbook that goes with it for $7. Or you might see someone advertising a masterclass/webinar, but costs $30 to do it.
It’s an online workshop run the same as a free lead magnet, but there is a charge associated with it.
Now, I see a lot of different reasons as to why people might want to explore this as an option, and some of them are great, but others not so great.
I wanted to talk about the idea of a paid lead magnet, and I’m going to be drawing where this fits into the actual flow of your customer journey live while recording this Tashmas episode.
So if we think about your customer journey as they come into your business, at the very top of that journey is your broadcast content. That’s things like your social media, website, blog, YouTube etc. It’s where you’re trying to get your biggest reach. People might see a post of yours or an ad.
You’ve got all of those ways that you go out and reach new people in your business. The next step is usually wanting to get them onto your mailing list. You want to grab their email and deepen the connection you have with these people, so you have things like freebies, webinars, ebooks, video series and more. It’s a sampler. It’s where people get to work with you and get on your mailing list, you give them something in return for their email.
The next stage of working with you is usually a paid something-or-other. It might be an introductory session, course, membership or similar.
Then you have the VIP level where you want people to jump into your signature program, or work with you for an extended period of time.
So there’s this customer journey and usually its free above the dotted line and paid below. (04:39 in the video)
What this theory is built on is that if you can get some money from people earlier, then you will create more trust with them, they’re more likely to do the thing that you give them, and therefore if they have already invested a small amount with you they’re more likely to invest even further.
It’s a method of dealing with the transition point between getting your free stuff to actually paying you some money by introducing something that’s at a very low price. Often what they try to do is move that point of payment to as early as possible in the customer journey to speed up the time that it takes from someone finding out about you to spending money with you.
We know from online marketers and industry data that for most people the journey between someone finding out about you and spending money with you is 60 – 90 days, depending on a lot of variables. But for online marketers who want a return on investment a lot faster, they push a paid lead magnet as soon as they’re on their mailing list to increase the chances of them buying a bigger thing from them at a quicker rate.
There are some pros and cons for doing this as part of your strategy. The reason why a lot of people choose to make a webinar a paid thing is because not a lot of people are turning up to it live, or they can get 300 people signed up to a webinar but none of them buy their paid product at the end of it. They’d rather have 30 people there paying for the webinar and then they don’t have to worry too much about them buying the thing at the end, because they’ve been rewarded and paid for the time they spent running the webinar itself.
Also for a lot of people they think that they’ve got this list of 5,000 people and only 10 of them have bought their VIP offer, so there are 5,000 people waiting for a low-cost thing from them and they need to have something to offer these people, because of fear of missing out on the sale as so many people aren’t ready for the VIP package.
As you can see, we think that by adding another layer here that’s way cheaper, we’re going to get a lot more paying customers because we’ll get higher conversions if it’s at a lower price.
The problem with that logic is that for most people, the reason why people aren’t buying things is not because of the price point, it’s about the value. It may be that the messaging in this space is not clear enough, and it’s not converting well because you haven’t nailed your niche or your messaging, and actually this paid lead magnet is a band-aid solution that masks a bigger issue with your business model or your messaging.
There are so many other things that would be contributing to this not working well, but sticking this paid lead magnet in can often lead to over-complicating your business model and working a lot harder for a lot less money in your business.
When you’re thinking about moving into having paid lead magnets/tripwires in your business, there are a lot of different factors to take into consideration.
Factor #1 is: Have you actually nailed your niche and message first?
Do you know that you have got the right messaging for your business? Do you know that when you get 100 sign-ups to a webinar, 3-7 of them purchase your course, and you know what your conversion rates are before you start introducing these super low-cost offers?
Because if you don’t have that stuff sorted first, plus the complexity of a lower priced offer which people are jumping into, you won’t actually know what the problem is.
Is it that people are buying the $20 thing and they haven’t finished it yet? If so this could mean they’re going to graduate into buying something bigger from you eventually.
Or actually is that they don’t see the value in your larger package, so when they see your other thing they’re like “Well it’s only $20 so why not?”
It can make it harder to understand what you need to do strategically in your business to grow your income when you have a diverse range of offerings at diverse price points.
The second thing to think about is if your focus in your business is growing your reach, this is going to damage that.
Have a think about what your priority is for you in your business, is the priority for you to get the numbers working at all of the other levels, and adding the next level in won’t be good for you? Or is the priority for this year to incorporate this extra level.
I did this. I actually went from running free webinars every month to every other month and having a paid masterclass in between. For the year that I did this (2016) my list growth for that year was the lowest it had been ever in my business. I was getting more list growth in the early months of my business than I did in that year.
What I realized is that I had this real stagnation in the growth of my tribe in 2016, and by introducing this paid masterclass I was actually decreasing my list growth by almost half, because I had taken away half of the webinars for the year.
The signup rates for those paid masterclasses (regardless of how much I changed the price) maxed out at about 15 people per class. But in that same year, my free webinars were having 300 sign-ups each. Would I rather have 15 people paying a nominal amount of money, or 300-500 people signing up to a webinar every single month in my business? Of those 300+ people, I knew that 9, 10 or even 20 of them would purchase something from me every single month.
I was much better of sticking with the existing strategy and not introducing these paid lead magnets.
That was a really interesting thing for me to discover some of the pros and cons of this strategy. I also tried using tripwires, which are when people sign up to my list, I make a short-term offer for them at a low cost. This increased the unsubscribe rate because people were getting that invitation to buy something so soon after joining my list and that wasn’t appealing to them. It was too much.
So this showed that tripwires were not a good strategy for me either.
Now that my business already has a lot of scalability at this level (and in 2019 Facebook ads are going to play a much bigger role in that)
And my list is growing consistently every single month.
And my conversion rates are great and I know what they are.
And I know the average journey time for my customers.
Now that I know that all of it is working, I’ve added a paid lead magnet into my process in 2018. They are called the Get Profesh Seshs.
I ran 3 of these Get Profesh Seshs in 2018, and these were much more in-depth strategy-based pieces of training that were lead magnets for the Heart-centred Business Academy.
The reason why the Get Profesh Sesh works so beautifully in my business is for one, that everybody in the Academy gets it for free since they are things I would be running for the Academy anyway.
#2 they’re only available for a limited time
and #3 for people who are ideal clients for the Get Profesh Sesh, they are at that point in their business where they’re looking for that in-depth strategy training and they’re willing to pay a small amount of money for that, and most of the people who joined the Get Profesh Sesh were already on my list and had been for some time. We already had that know, like, and trust factor.
Because of all of these factors, the conversion rate into the Academy was between 5-10% (depending on which Get Profesh Sesh it was), which is a really high conversion, but it had a lower signup rate than if I ran a generic webinar. That’s actually good for my business though, because I find that I don’t attract the right people to the Academy with free webinars. They either aren’t the right people or they are already a part of my tribe, so having a paid lead magnet really works in that instance.
The Heart-centred Business Academy is currently sitting at over 100 members and I have worked out over the years what the best strategy is for getting the right people into the program. It’s a much longer journey for people signing up than other signature programs such as Take Off. This paid lead magnet is doing it’s job by accelerating the customer journey for the right people.
I wanted to share all of this with you because I think that for a lot of people the super low-cost offer (I think anything below $50 is in this category), in theory, sounds like a really sexy way of accelerating your business growth, getting more money in the door in the short term, as well as increasing conversion from those paid lead magnets.
But when you break it down to the practical realities, it can actually be a big sabotage to your business success if you execute it in the wrong way, or too soon in your business journey.
So hopefully that’s been really helpful for you and has been some good food for thought around whether a paid lead magnet is the right thing for your business. Now, of course, there are lots of different scenarios for different businesses, I’ve talked to a lot of people in the Heart-centred Business Academy about it, and often a lot of people disregard my advice and try it out anyway.
They want to see if they can get the strategy working for themselves because no great business is built on theory, might as well go out and test it. But they’re doing it with their eyes open, knowing that it might not be the right strategy for them. We have a recovery plan as well, just in case it goes awry.
But if you were considering paid lead magnets as part of your business strategy, hopefully, it’s given you some really good ideas to think about, and you can really consider where it fits in your business journey and whether you’re just trying to mask an issue with a part of your conversion process. That’s usually what’s happening when people try to introduce them too soon.
What I’ve got for you today in Tashmas is a very special offer as well. If you missed out on the Get Profesh Seshs, and there was one that caught your eye, for the first 50 people only, I am actually offering the recording of one of the Get Profesh Seshs absolutely free.
What I’m going to do is make a post on my Facebook page (facebook.com/tashcorbincoaching). On that post which goes live at 7 pm AEST on December 5th, I’m going to give you a little synopsis of the Get Profesh Seshs that we’ve had so far, and all you need to do is be 1 of the first 50 people to comment on that post with the Get Profesh Sesh that you would like, and we will send you a link via private message.
I should also say that there will be more Get Profesh Seshs in 2019, so if you miss out on the first 50 this time around you can either join the Heart-centred Business Academy and get all of the recordings for free, or watch one of the ones that will be rolled out next year.
Thank you so much for joining me for this episode of Tashmas. Until next time big love from me, and bye for now. Happy Tashmas!