Ep050: Ashe Higgs

Welcome to the More Cheese Less Whiskers Podcast Today we are talking with Ashe Higgs from Tempe, Arizona.

Ashe runs a martial arts program called I Liq Chuan and as you listen to this episode, you'll see the underlying structure, the puzzle that we're trying to solve is essentially, he has a location where he serves members through classes and private lessons, so how can we best fill that capacity.

That’s the mechanics, the logistics of what actually happens and you can overlay everything that we talk about to any business that follows that model. It could just as easily be a fitness studio, an after-school tutoring program, a tennis or golf instructor or anything where the model is that you find people, you bring them into your environment, you let them experience what you have to offer, and they join to stay as a member and continue to use those services.

It's important you understand the underlying limitations, constraints or goals for what we're looking at here. It's often the case when we start out to want to focus on the ad or what can we do to generate leads. You’ll see today that the path to Profit Activator 2 often goes through Profit Activator 5, understanding exactly what it is that you do to create that world-class experience, that dream come true for people, and Profit Activator 1 of who is that an ideal fit for.

Once you understand those two things then we can get to work on the rest of the before unit activator.

I think you're really going to enjoy this episode no matter what business you're in.


Show Links:
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Transcript - More Cheese Less Whiskers 050

Dean: Ashe Higgs.

Ashe: Morning Dean, how are you?

Dean: I am good. Master Higgs.

Ashe: Uh no, just Ashe is fine.

Dean: Okay. How are you, my friend?

Ashe: I'm doing well. Excited to be here.

Dean: I am too. So we are recording right now. We got the whole hour. Tell me about what you got going on and what we can do.

Ashe: Okay. So, I'm in involved with a martial art called I Liq Quan. And we operate --

Dean: Easy for you to say.

Ashe: Yeah, exactly. We operate at three levels. So we have local, national, and international. And I'm involved at all three levels. So at the local level I teach my own classes here in Tempe, in Arizona. And I do a lot of weekend workshops at the national and sometimes international level. And I'm also on the management team at overseas, all the students and instructors around the world. So right now we have about ... We have classes in about twenty different countries around the world. Probably half of those are in the Russian speaking countries.

Dean: Oh wow.

Ashe: And so we've had sort of some explosive growth in the last ten or fifteen years and we're getting ready to scale up again probably in November, which right now I can't really discuss too much of that. But the problem is that a lot of that growth has been driven by the personal charisma of our worldwide chief instructor.

Dean: Okay.

Ashe: So a lot of the other instructors have not been able to make a full time living at I Liq Quan except for a few of our instructors in Russia and of course our worldwide chief instructor. So what I'm trying to do is work here at the local level in Tempe to crack that sort of scale ready algorithm that you talk about. And then be able to package that up and roll it out to all the other instructors around the world so that we can kind of change that situation for a lot of people.

Dean: Okay. So now, say it slowly how you're saying it. What is it called again?

Ashe: It's called I Liq Quan. So it's a Chinese martial art and it comes out of Malaysia.

Dean: Okay. And so what does it resemble? Is it ... What's it closest ...

Ashe: If you had ... Right, it's ... I said it's more like Thai boxing than tai chi, but it's more like tai chi than Thai boxing. So it's kind of somewhere in the middle between those two. So we've had a handful of the instructors including myself who have fought competitively full-contact and have done very well. But ...

Dean: Right so it's more punching and kicking than grappling.

Ashe: Not really.

Dean: No? Okay.

Ashe: Yeah so, the rule sets that I fought under and that some of the other instructors, so it's like three-quarters them and me. So it's punching, kicking, and standup grappling. And so once somebody hits the ground, they'll stop the action there and stand every back up.

Dean: Oh okay. That's all I needed. Right yeah.

Ashe: Yeah, yeah yeah.

Dean: Okay.

Ashe: But like I said it has a lot of elements that are much more similar to -- like, in practice, common everyday practice -- a lot of elements that are much more similar to tai chi. And so the majority of the people who are involved in our classes aren't really interested in the actual fighting aspect. Most of the people are for social reasons, for health, for that kind of thing.

Dean: Okay. Got you. So what is the reason that people are getting involved in it now? What is it's ... You kind of mentioned it's not so much about the fighting but about the --

Ashe: Right. Well that's one of the things that I was hoping I'd cover with you today was that second profit activator of kind of like getting some cookies together because ...

Dean: Yeah.

Ashe: I mean, from listening to past episodes of I Love Marketing and also More Cheese, Less Whiskers, people get involved with each one. Really what it boils down to is what you've called "irrational passion."

Dean: Yeah it could be. I bet there could be some practical element to it too, right? We'll kind of explore that a little bit. The pathway to profit activator 2 goes through crystal clear understanding of what you can deliver in profit activator 5 and who the ideal person for that is in profit activator 1. We know those things, then we come in to profit activator 2. So we're not starting with that, you know. So in order to get really the best results in profit activator 2 is really about tapping into an already existing desire. You know, there's all of this that's going on. You know, there's all the things that people ... All the desires that they have. There's universal desires for things to, like lose weight, make more money, save time, all of those things that are built-in to us.

And then there are more specific desires. And if we understand why somebody ... What this is tapping into then we can move that desire to put its attention on how I Liq Quan can do, can provide for that outcome that we're looking for, you know?

Ashe: That's right.

Dean: So, yeah. So what does it involve? What was ... Tell me the ... Because you're looking at creating this scale ready algorithm to take out so let's just focus on your Tucson situation. And to be able to say, "what does that look like?" without ... Let's even just take away the fact that we're ornamenting it with this I Liq Quan situation and just say what is the underlying mechanics of it. You got a location that people are going to come to do something and pay you a certain amount of money, right, so that's the ... And in that way it's no different mechanically than any other type of business. So I just want to see how the mechanics of it work. Do you understand what I'm asking? Like what the ... How ... Well let me go through it one other time here.

So you've got one physical location.

Ashe: Uh huh.

Dean: Okay. In Tucson.

Ashe: In Tempe.

Dean: In Tempe, okay. Sorry. I thought you were in Tucson. Sorry. In Tempe. So you've got one physical location there. And what does that look like? Is it like a dojo type of ... Is it what I've got in my mind? Is there anything different or unusual about it? Is it a place where people come together?

Ashe: Yeah I mean it's more or less ... There's nothing very uniquely special about the location itself.

Dean: Perfect. And when people come there, if I were looking at it at it's peak, you know, and your peak time, what are we seeing there? We're seeing a group of people. How many people are in a ... Do you do classes or are people training individually or they're coming at specific times?

Ashe: Yeah it's both. So right now I focus on small group classes and private lessons.

Dean: Okay. And what is a small group class?

Ashe: Around a dozen.

Dean: Okay. Small groups, twelve people. And do you do them at specific times?

Ashe: Yeah.

Dean: How often? So each one's a group. Are they joining your 8-week program or are they ... ?

Ashe: Yeah I usually bring people in through ... So like in my profit activator 3 I have a two-week trial. So people will come in and start on the two-week trial, and they just roll right in. They just roll right in to ...

Dean: Monthly.

Ashe: Yeah.

Dean: Yep. So it's not like a six-week or 8-week program and then they've got to re-sign up. You're getting them on a monthly stay as long as you want.

Ashe: Yes.

Dean: Okay. And is it a belt-based program? Are you advancing with a white bet, yellow belt, moving up a ...

Ashe: Similar. Yeah we have student levels. So those go one through eleven and then we have a parallel ranking structure for the instructors. It's kind of built in to help teach your fellow students right from -- not from the very beginning -- but from early on and so those two ranking systems are staggered. So totally you could say there's twenty student levels. Student and instructor levels.

Dean: Okay. And are they named like that, level 1, level 2, level 3? Or --

Ashe: Yeah. Nothing fancy.

Dean: Is there any physical indication that one person is at a different level. They get strikes on their belt? Do they get numbers? Do they get ... How do they --

Ashe: Yeah we do the stripes.

Dean: Okay. So they get stripes on their belts. So you just got to count the number of stripes or something. It's not --

Ashe: Yeah and there's different colors.

Dean: Okay.

Ashe: So it's like the first four levels are white stripes, and then when you go from five and above you switch over to a gold stripe, and the instructor levels are red stripes.

Dean: Okay. So white, gold, red, on a black belt. Is that --

Ashe: Yeah. Yeah.

Dean: Okay. Alright. And it's an interesting thing because there's some ... I think that some element of longevity, right? Of people advancing towards ... You know, if we're comparing other martial arts of people advancing towards a black belt, you know? That's kind of standard. In different martial arts that's kind of a way we're conditioned societally to know that white belt is where are start and black belt is where you're headed. I think maybe most people know, you know, yellow, orange, but then it's gets all fuzzy. Where do you go from there? Most people don't make it past that, right?

Ashe: Right. Right.

Dean: I'm sharing the general perception of something. Which is important because that helps us get the awareness level of what it is. So that's where I'm trying to help find the home for I Liq Quan. Where does that fit for this, you know. And so what makes it a different thing than the other options that I have. If I'm going to take martial arts, is it something that, you know, if we were to say ... To rank the awareness level and let's go basically by my own awareness level, which might be in tune with everybody and think everybody sees that name of martial arts, probably karate would be first, and jiu jitsu maybe and judo.

Ashe: Right.

Dean: Those are the big three mainstream wise. Tae Kwon Do, maybe. And they all share that belt system, right? Kids would understand that. But is your group of people, twelve, are they ... What do they look like? Who's in the room there?

Ashe: Well our sweet spot, our demographic is really males aged 35 to 55. You know, most of them are college education and they're either in middle management somewhere or they're in like a bodywork kind of capacity.

Dean: Okay.

Ashe: Most of them have had five or more years in another martial art. That's really our sweet spot. So it's like the appeal for I Liq Quan in general can be kind of divided into two categories. Either one is the people that have previous martial arts experience and so quite often I Liq Quan is used sort of like as a master's level program for martial arts.

Dean: Uh huh.

Ashe: Because of some of the explanations that are given for the refined body mechanics that are often absent. In a wider sense the appeal is the zen philosophy. We put ... And we subtitle I Liq Quan as the martial art of awareness. And so zen philosophy is a huge part of what we do and how we train and how we approach training. And so in a wider sense, that's where a lot of the appeal is also for people.

Dean: Awareness. And what does that mean? How do you define what awareness means?

Ashe: It is the attention in the present moment to be able to clearly recognize what is actually happening, like what is present in the moment. And so we start out with training from point of contact with an opponent and within ourselves we're looking at all the different qualities that are present. And then you expand it out from there. And so my teacher who is the worldwide chief instructor, he likes to say that, we're not training martial arts as a goal. So in other words it's not necessarily about self-defense. But we're using martial arts as a tool to train our attention and our awareness.

Dean: Okay, so that's an important distinction. I'm seeing a couple of thing here when we're looking to see who this is most attractive to is that element of it is ... could be an import distinction. So it's not really ... So you're saying 35-55 males, it's not really something that kids are getting involved in as their first martial art? It's something that would be more appealing to next level, advanced martial arts kind of thing?

Ashe: Generally speaking yes.

Dean: Okay.

Ashe: They're working on developing a kids program. So they have a pretty robust kids program in Russia right now. But it hasn't been something that we've been able to scale outside of Russia and one of the things that I've been trying to work on is how to, again, package up the cookies so that there's a bit of a wider appeal because the niche of experienced martial artists that are looking to go to the next level is so small.

Dean: That's what I was just going to say, is that's what I see as a challenge for this is that, not only is it limited to a demographic but limited to somebody who's sort of ... It's a niche of a niche, in a way, right?

Ashe: Right.

Dean: Yeah it's somebody who is moving over from another martial art. And not that there's anything wrong with that, it's just that it is what it is and it sort of creates some level of limitation, you know, because you're just limited in the number of people who that would be appealing to. So when you look at it right now, if you do these twelve person classes, how often does somebody come? How many times a week do they come if they're into this?

Ashe: It's multiple times per week and then we do additional ... We'll do additional weekend trainings and retreats and things like that.

Dean: Yeah. And so you must have ... You've got prime times that people are coming after work or in the mornings before work.

Ashe: It's after work and then you know, private lessons are all scheduled by appointment.

Dean: Uh huh. Okay. And so what would a full practice look like, or a full dojo, or the optimized single unit here, if we were just to take ten people. What would be ... if we could have it any way you want it, how many classes, how many members ... Is that what you call them? Or what would you ...

Ashe: Yeah I mean, members is fine.

Dean: So how many members would you have and how much money do they pay?

Ashe: You know, right now I think under my current conditions I could probably, if I maxed it out, I could probably handle somewhere between 80 to 100 members because not everybody comes like every class.

Dean: Yeah.

Ashe: You know, so that would probably equate to somewhere about 30 or 40 people on the mats at any one time and that's manageable right now for me as a solopreneur. You know, moving up into the future we could always scale that and hire additional instructors. But under my current conditions that would probably be somewhere between like 80 and 100 total.

Dean: Okay. And what would that be revenue-wise? How much do people pay per month? Is it tiered pricing or is it all one, like one level of pricing?

Ashe: Right now my rates are pretty low. It'd be 60 per individual on a monthly basis and then they pay hourly for private lessons.

Dean: Okay. So $60 a month is what somebody pays just to be part of it and they can come to all the classes if they wanted to that way?

Ashe: Yeah.

Dean: Okay. And the private lessons ... Do you bill per hour on those?

Ashe: Yeah. Per hour.

Dean: Okay. And how much do you charge for those?

Ashe: It's the same as the monthly rate, so it's 60 an hour.

Dean: Okay. Fair enough. And how many of those would you do in an ideal world here?

Ashe: Just trying to realistically manage schedules and everything I could probably do more than...

Dean: Part of the thing ... This is where some of this process of like ... Regardless of what you do, we could be talking about you as a massage therapist or a kickball instructor or a soccer school or equestrian or anything. None of that is really ... What the essence of it, the underlying mechanics of it, is that you got a location that people are interested in your thing, are going to come and they join your membership program for $60 a month, take part in classes and take private lessons. The mechanics of that are what's important to really understand before it even matters that it's specifically I Liq Quan or karate or whatever it is.

Ashe: Right, right.

Dean: So when we look at it, you're the practitioner, right? You're the person who this is built around. And at this level, what you're looking to do is to create a full practice for yourself, right?

Ashe: Right.

Dean: And so you look at it that there's ... That model, if you have 100 people at $60, that's $6000 a month for the classes, the baseline membership. And then how many ... If we're kind of creating your perfect scenario, your perfect world, right? We've got to imagine this exactly the way you want it. This is part of it, pushing the accelerator pedal and seeing, well, what does that actually look like? What if I had 100 people? That would mean that my classes are pretty much full all the time and that ... How many hours of classes do you do? Do you do ... are they just one class in the evening or are they an hour? What does that kind of look like?

Ashe: Right now it runs about ... total runtime is about 3 hours. We do --

Dean: So they're coming for the evening. They're not coming in for the ... Not like a spin class where they're coming in for the seven o'clock and then they're out and the next class is in for the 8 o'clock.

Ashe: Right, right.

Dean: It's like you're in for the evening, right? So you do those ...

Ashe: We have ... I run a bootcamp-style fitness class the first, about 45 minutes, and then general class starts and not everybody comes for the bootcamp portion of it so --

Dean: I got it.

Ashe: People will come in. You know that starts at quarter after 5.

Dean: Yeah.

Ashe: We get that done by 6 and then people, you know, that aren't interested in that or can't make it in that because of their work schedules will start coming in around 6 o'clock and then that'll go until, officially it's over until 7:30 but quite often we'll go over until 8.

Dean: Okay. And you do that four nights a week?

Ashe: Yes.

Dean: Yeah. And then on the weekends you do Saturday mornings or ... Saturday or Sunday mornings.

Ashe: Sunday. Sunday.

Dean: Sunday afternoons?

Ashe: Mornings. Sunday mornings. Sorry.

Dean: Sunday mornings. Okay. And that's it. So there's five opportunities for people to come to class.

Ashe: Yeah. I've found that sort of limiting the number of classes actually works better --

Dean: Yeah of course. Why not.

Ashe: Yeah.

Dean: Yeah it's good. Less moving parts, right? Get everybody in there. You're only splitting it up otherwise. No difference between coming at 6 o'clock or coming at 8 o'clock. It's just if the only option is 7 you're going to come at 7. So yeah, that makes sense. What about the private lessons? How many hours of private lessons would you like to have?

Ashe: Realistically I couldn't expect to do more than 2 hours a day.

Dean: Yeah, perfect. And that's good to know. When you look at it that way, that that's ... If you do two hours a day of private instruction, and you do that on ... Are you open at all on Fridays or do you, you know, is this kind of ... ?

Ashe: I mean, that would be where the private lessons would come in. All the off days are when there wouldn't be class. If somebody wanted to schedule a private lesson ... Say my schedule is fairly flexible as far as being able to arrange the private lessons.

Dean: And so that would be Friday. And you wouldn't envision ... It's not something that somebody would come in the middle of the day on a weekday? You're saying it'd be ... You wouldn't envision doing a class and private lessons during the day that way? Because you're talking about working people ... You're not working with you know, stay at home moms or anything like that. You're working ...

Ashe: Yeah I mean sometimes somebody would be say, self-employed. That they're an attorney with their own practice so their schedule is more flexible for themselves so in that case maybe we would schedule something in the middle of the day.

Dean: Right. Okay. And that makes sense. So to get a picture of it. So you may see yourself having ... So maybe like 6 or 8 hours a week of private lessons, would be ideal?

Ashe: Yeah.

Dean: Right. Okay and so where are we now in terms of that capacity? Right, that's the constraint. That's what we're looking at, 100 people. 100 members and 8 private lessons.

Ashe: Typically at the moment I'm only getting probably like one private lesson scheduled per week.

Dean: Okay. One private lesson and how many members are you at right now?

Ashe: Total is in the neighborhood of two dozen and ...

Dean: Okay. Okay. And so what do they ... So we got some runway here, right? So we got 24 members right now. And how long do they stay? Do you have some churn or is it once they're in they're kind of with you for a long time? What's the lifetime value of a member?

Ashe: Just right now I'm calculating everybody's lifetime value at about $1500 because there's ... We have the outliers that stay for a really long time.

Dean: Sure.

Ashe: So then the average ends up coming out to be about six months.

Dean: Yeah.

Ashe: And that's pretty standard for industry average. So it's actually the majority of the people that are training with me now have been training with me for three or more years but there's always the churn at the new level where people come in and they say, eh it's not exactly what I thought it was going to be and it's not for me.

Dean: Right. Okay. And so when you look at it right now, this is really clear to get this picture. And we're talking about it like I want to keep bringing it back that it's really the model that we're talking about right now. Right? Like, you could just as easily be a massage therapist or anything.

Ashe: Right.

Dean: That group instruction. No different. That's the model here. It's constrained by the time and space that you have. So when we look at it right now. What is your best method of getting new people right now? Where do they come from?

Ashe: At the moment it's mostly through organic search and some word of mouth.

Dean: Okay. So what would the organic search be? What are the words that people are looking for? I mean, is it that they're looking for I Liq Quan specifically? I apologize if I'm saying it wrong or anything but I don't know. That's part of the ...

Ashe: Yeah it's close enough. Right now I do have a percentage of people that are looking for I Liq Quan specifically. Lately, for the last eighteen months to two years, I've been working to expand my reach, or my potential audience. And so now more generally people are just looking for a martial arts program in Tempe.

Dean: Uh huh.

Ashe: So and that's kind of a thing where, as far as trying to package up some cookies, it's like, my experience over the last 15 years is that with the general population when they first get involved in a martial art, they don't really care or know the difference between karate and judo and jiu jitsu. It's like they're just looking for a martial art.

Dean: Right. I agree with you. I'm going to say that that may be true, and that's why they kind of go with the name they know, in a way. Right?

Ashe: Right.

Dean: That they're saying okay, I got it. Go ahead.

Ashe: So now much more of the traffic that's coming to find me is all just searching for a martial arts program in Tempe.

Dean: Okay.

Ashe: And so I've been working to kind of put together ... Once I have the right cookies, I have the rest of my funnel in place that now I can start to go do like paid advertising on Facebook and such.

Dean: Yeah. Right.

Ashe: I've already got my profit activator 3 sorted out. I've got activator 4 sorted out. And it works pretty well. My --

Dean: Yeah so explain those to me then. So what's your profit activator 3? How do you educate and motivate people? What goes on right now?

Ashe: Yeah so right now I try to funnel everyone into a weekly email newsletter that I spent about a year putting together. And that's all just one actionable tip a week for basically, stress management, recovery, sleep, nutrition, general fitness, general health and wellness tips. Just to help people be able to maximize their life experience in the 21st century.

Dean: Yes.

Ashe: All the things that we need to know and how to navigate our lives in the 21st century but aren't really generally known or understood.

Dean: Okay.

Ashe: So then I have a super signature that I develop.

Dean: Nice. I like what I'm hearing.

Ashe: I've been listening to you for a little while now so I've been trying to put it all into action. And yeah so, just at the end of each of my weekly newsletters is the opportunity to take advantage of the two-week trial. And so right now, I just put some of this stuff into play about two months ago. And so my sample size is really small we have to take that into consideration but so far it seems to be working pretty well. And so I developed all the emails kind of in mind of short, personal, and expecting a reply.

Dean: Nice.

Ashe: And so from there, like I said, right now, my two week trial is my profit activator 4.

Dean: Yeah, right it's your offer.

Ashe: And that seems to be working pretty well. My conversion rate right now so far has been 100% but like I said, my sample size is pretty small but it's getting those cookies together that is my biggest missing piece. I think to be able to start working on this at a bigger level ... I guess doing some paid Facebook advertising and such to try and bring people into that funnel.

Dean: Sure. Yes. That's awesome. So when you look at it, that's all certainly part of it. It's so great that you've got a two week trial. It's great. What are the other cookies that you have on your signature? The two week trial ...

Ashe: At the current time, there's only one. I'm going to be expanding my services pretty soon to include some one-on-one nutritional coaching that ... Some of that stuff is like ... I'm going to develop an online coaching practice that will help people, like if they want to just lose weight and stuff like that, that is going to expand that --

Dean: That's confusing though, in a way. That's a different thing than the core thing that we're talking about, right?

Ashe: Okay. Right.

Dean: And that's kind of the same ... But again the mechanics are the same, right? Whether you're bringing people to a weekly or a monthly ... If you look at it, and I'll say this for anything that you're doing. It's just that the wrapper that you're putting on the mechanics of this is I Liq Quan. It could be the same model here, and this is where it's important to understand what's drawing it here, you know. So it could be the same thing if you had a grow-your-business club where it's $60 a month and you could come to class and you could learn entrepreneurial stuff and that kind of thing in that same location. You know? It's the general idea: finding people who are committed to a long-term direction, which, this could be the thing, the I Liq Quan.

And introducing new people into that at a rate that's going to get you up to your 100 people who stick. So in order to do that they have to be getting the outcome that they're looking for. For some of them it's something to ... You know, how would you rate the benefits that they would say that they get from it? Like what boxes is it ticking? Are these people considering I Liq Quan as part of their health and fitness? Is it part of their hobby, like their interest thing? Their discipline practice kind of ... Where does it, what kind of slant could you put on these? Like would you say that it's ticking a fitness box for people?

Ashe: Yeah. And so that kind of is some of the problem too. It's where the picture is kind of muddy. So as far as trying to get a nice, clear profit activator number 5, right? Is like a dream-come-true experience.

Dean: Yeah.

Ashe: So getting that well-defined is sort of tough because, like I said, the zen philosophy, it makes it such a big area that a lot of things fit into that for different people. So it's like, for some people it is the fitness aspect. For some people it is the discipline aspect. For some people it is just as a hobby.

Dean: Right.

Ashe: So it's also kind of hard for me to pin down.

Dean: Yes. I can see.

Ashe: There's a lot of benefits but they're kind of all soft benefits. A lot of it are hard to quantify.

Dean: Right.

Ashe: It's kind of like quality of life. For the most part it's all quality of life stuff. Because even if we were just talking about self-defense. It's like how do you quantify that?

Dean: Yeah.

Ashe: And especially on a day-to-day basis, most people will never in their whole life actually need those skills. So it's very difficult to quantify.

Dean: Right, exactly. And you're absolutely right. But it's like there's a confidence level and that carries over in a lot of ways. I mean, that's really where, if you look, that's where karate's done a great job with children. Teaching that as the core thing that people learn in karate, of discipline and respect and confidence. You know, those kind of things that give children an edge kind of thing. You know?

Ashe: And for us --

Dean: For you, looking at the adults, yeah you're looking at these 35-55 year olds that if you're taking high net worth people, executive type of guys or ... What would you say would be the occupations that these guys are in?

Ashe: Yeah it's usually one of two branches. It's either ... For the most part everybody's college educated and is either in middle management somewhere or they're in a body working industry.

Dean: Uh huh. What does that mean, body working industry?

Ashe: Like either physical therapy, massage, you know, practices like that. Physical therapeutic massages.

Dean: Oh I see.

Ashe: Because of that awareness factor, they improve sensitivity of touch and stuff that comes out of our practices.

Dean: Yeah.

Ashe: They quite often feel that it improves their ability as a therapist.

Dean: Yes. Got you. That's an interesting thing right there. If you're saying that that's who's naturally kind of gravitating towards you?

Ashe: Yeah. Our demographic, like age-wise and education and everything, is going to be split. Probably like 60-40. So it would be like the 40% is involved in some kind of, like I said, either massage, physical therapy, acupuncture, something like that. And then the other 60% probably is involved in middle management in some capacity.

Dean: Right. Got you. Okay. So I think that this is kind of made for some Facebook advertising, in a way that it's very ... Well certainly you're probably already doing pay-per-click stuff. Are you or not yet?

Ashe: I experimented with some of it and it didn't go too well because I didn't have my 8 profit activators sorted out. And so I pulled back from that until I had things put together to be able to do it properly. But by and large I would agree that our audience is on Facebook and then also YouTube. Which has been actually a really high performing tool for gathering leads, actually.

Dean: Well that's great. And you have ... this is part of what I was going to ask you. Do you have, you know, the cameras rolling while you're doing classes, or you know ... Because I think that's kind of the thing of getting awareness of it. And people can see what this is actually like. When you look at it, is it ... Just describing it right now, I have no idea what this might look like, right? Because I don't have a context for what I Liq Quan is. If you say, a name brand sort of ... I used name brand as a higher awareness martial art.

Ashe: Right.

Dean: If I say, if you say, karate, I've got this vision of, "I know what that environment looks like," right? There's people with their uniforms and their belts and they're in that kind of environment on the mats, you know. Bright kind of environment. If you say jiu jitsu, I've got a different kind of ... there's different vibe. And they have an even different vibe. Right? See that as either you get this environment that I might be scared to go into, an MMA training place, right? No I'm just saying if you just paint that visual image for them, what would be the environment that we're talking about here? If you can kind of take the mystery out of that for people, is it a fun environment? Is it a quiet and disciplined, or more zen, hushed tones kind of environment? Is it a, you know ...

Ashe: Yeah it's more fun.

Dean: Yeah.

Ashe: Because our main partner practice we call "spinning hands." And it looks pretty unique when you see it. So yeah we have made quite prolific use of video.

Dean: Perfect. Yeah. Because I think that's part of it, right? If you have those kind of trailers, you know. Like a video trailer. I think that that's some of the best opportunity right now, certainly, is the YouTube video ads to a localized audience. And I've been doing a lot of experimenting lately with local Facebook ads and doing gift cards as a thing to get somebody to download, like for opt-ins, you know? And what I've found ... It's amazing the difference between a hundred dollar gift card and 20% off. Even when it's the same thing. Which is really interesting. If it's a $500 service and that same 20% off is very different than giving somebody a hundred dollar gift card.

Ashe: Right.

Dean: Because it's like a token that they can take that now just in case they decide that they want to do that in the future. And so profit activator 2 is all about just getting people to raise their hand and make some kind of ... Compel them to take some kind of action now to turn themselves from an invisible prospect into a visible prospect.

Ashe: Right.

Dean: So when you're ... If you're combining, you may have to combine and cycle and add ... Take a group of people, if you just take a small group in Tempe within a certain radius of Tempe, you get an audience of your 35 to 55 year olds with certain income or occupation or whatever and if there's any ... I think I would go that broad for you right now. Because you're in a local market. We're not looking to narrow it down. We want to kind of build that awareness. So if you're showing up in people's news feed initially as something that is ... You know, you're kind of building that awareness for what it is, and you're making some kind of an offer for a free class or ... A free class may be a good start into the two week trial.

Ashe: Well actually what I was going to say was I had to come up with some gift cards.

Dean: Okay.

Ashe: So I do have gift cards that I could run an ad campaign but that was the cookie.

Dean: Yep, perfect. And I think that's been, for me, a very successful thing. Is offering a gift card using the Facebook lead ads where people can just click to get it, because they don't have to enter in their email, they don't have to do all that. It just fits in the compulsion model. They don't have to consciously think. It's like super liking in a way. It's as easy as clicking. They just click and then they see the thing, here's your email, here's your name, that's what they're going to get. Okay. Download your gift card. That, that --

Ashe: Right so they're just, they're a digital gift card?

Dean: Yes exactly. Right.

Ashe: Okay.

Dean: Now and that could be a very easy thing for you to test. You know? Any of these tests that we're doing here, you're looking at a $20 or $25 test. You know, you can know in 24 hours. You could say listen, I'm going to a $20 test for the next 24 hours. I'm going to offer these 35 to 55 year olds within three miles of my exact location here. I'm going to offer them a gift card. That would be a really good starter test for you. You know? No, that sounds great. I think sometimes it's like we have a tendency to overthink things. And you miss the simple solutions.

Dean: No I get it. And that's why all of this stuff of bringing it down to, let's just look at what the mechanics of it are, you know? We're really ... Take away the specifics. And it's no different mechanically and logistically than a fitness bootcamp or a tennis camp or a golf instructor or anything with a physical location that has a membership kind of model to it. You know?

Ashe: Right. Right.

Dean: Have you tested pricing? Because that seems pretty low for ...

Ashe: It is low. I actually just recently raised my rates and then I'll be raising them again ... I was listening recently & and he was just talking about how you shouldn't raise rates on existing members but you raise your rates and then as you bring in new people and so that's kind of the model that I'm working towards now.

Dean: Right.

Ashe: Within about a year or 18 months I'll be doubling my rate.

Dean: Right. Which sounds more in line with what other options.

Ashe: Right.

Dean: Like even if you went to one of, you know, the fitness bootcamp are more than that. Right?

Ashe: Right. Yeah so I mean $100 to $120 a month mark is pretty much industry standard.

Dean: Yeah. Okay. Yeah so I would say getting to that level ... I don't know that there's any ... I would maybe do that as fast as you can. Because somebody coming new, or making that decision, you've already got enough that it's active and that it's a going thing, so people are going to see it, right?

Ashe: Right.

Dean: So rather than, we've only got 60 or 80 slots left, right? So when you look at it, if you're going -- and I agree with this, that you're not going to raise rates on the existing members -- is, why not let's see how high is high here, you know?

Ashe: Right, right.

Dean: Especially when you're going to start when you have to factor in a cost of acquisition, right? You've got to have some level of ... You've got to pay for these ads.

Ashe: Right.

Dean: Yeah. Because that's the other question, right? If we're detaching your before unit from the during unit, by the time you take in your time and your overhead on the cost of actually delivering, keeping the lights on, and delivering and running the business of it, if we look at the before unit as a supplier to your during unit, right? You were looking at a time where once you get it full, you don't have an unlimited supply of what you've got, right?

Ashe: Right.

Dean: You've got to get to full and then you just keep that ... I think you could probably keep that going by referral, you know? Orchestrating referrals within your group, you know.

Ashe: Right. And that is actually why I come up with the gift cards initially, was to use them as part of profit activator 8.

Dean: Uh huh.

Ashe: So yeah. Perfect.

Dean: I think this is good. You got a good start here, you know. Good understanding. What would you say, based on what we talked about, how was your recap of what we talked about? What kind of insights?

Ashe: The big takeaway for me was again just not to overthink it and I kind of use those gift cards as another cookie and also to be able to raise my rates.

Dean: Yeah I think you need to do that right away. I don't think you need to ... Because it's the same awareness, right? It's not going to be the price that's going to ... especially when we're talking about the difference between 60 or hundred.

Ashe: Right. And also just sort of one thing that solidified for me, during the course of our conversation, was that profit activator number 3 is actually going to overlap in my case with 4 and 5 because what we were talking about is that in a general sense, the general population they don't know necessarily know the differences between the different martial arts anyway. So it's like, once I get them in the door with the right cookie, is my chance to continue the process of educating them over time until ...

Dean: Of course yeah. I think that's valuable because that's really ... And you've already got your ... You know, it's kind of there. Set it and forget it, in a way, right? You can start somebody on that sequence that goes in there and that's once a week?

Ashe: Yeah and then once they would convert over into a member then I have an additional email that goes out to members only that has more information and that's for members only.

Dean: I like it.

Ashe: Yeah and I put that on a different day.

Dean: Yep. I think that free class ... Is your gift certificate for a dollar amount or for a specific, for a free class? How do you work it out?

Ashe: Right now it's a dollar amount. So right now I'm calling it, it's a ten class gift card.

Dean: Okay. Oh that's nice. Yeah yeah. That's good. Yeah because that would mean somebody could come every day for two weeks, right? That's what you're talking about.

Ashe: Yes.

Dean: Okay. And I almost think you could have ... You know how Groupon does these kind of awareness ... You're thinking about it as something that somebody could try out if they've been thinking about doing a martial art or doing something to show what that actual environment looks like and offer that. You know, free, think about it as an experience kind of thing. I think that's good. I think that's where they are right now. You know, good thing about local businesses is that you know where everybody is. You know where your clients are. It's all the 35 to 55 years old within a range of Tempe.

Ashe: Right and that was one of the things with that. Like I said we're struggling with some of the cookies because there are right now, they're invisible prospects.

Dean: Right, yeah.

Ashe: Trying to figure out the cookies to get them to be able to raise their hand and identify themselves as ... Been a struggle before now.

Dean: Yeah. I think that's good. Part of the thing about using Facebook on that local side is that you have to cycle them through because you've got ... You're showing the same ad to the same people. It's not a bottomless pool, right? So it starts out, you're showing it to people for the first time. And there is ... You know, if you take the pool of them, you take the big pool of all of those people who would qualify.

Ashe: Right.

Dean: In your group there. That some of them, if they knew about it, this is exactly what they've been thinking about doing.

Ashe: Right.

Dean: Right, so when you come out of the gate, if you're ... their awareness is, wow, that's right down the street. Right?

Ashe: right.

Dean: I mean, they're thinking to themselves, oh wow, I should try that out. Well lookie here. Free class. You know?

Ashe: Right.

Dean: It's kind of a cool thing. And I wonder, ten classes may be ... I would experiment with just having it as an event kind of thing, you know. Or maybe even do specific, new ... steer new people into a specific class. You know?

Ashe: Right, maybe doing like a free half day workshop on a Saturday or something like that.

Dean: Could be. That's exactly right. Yes. Or then you've got the opportunity to build the ... paint the picture and get somebody on to it.

Ashe: Right.

Dean: That's a great idea, right?

Ashe: Okay. Awesome.

Dean: Well that's good. So I think you're ready to maybe even test that, but I would certainly use your existing members first. And say, I'm going to do a class, I'm doing an intro workshop on this, you know throw your hat over the fence, whatever Saturday that is. And have them, give them something to give to their friends. You know? To somebody who can come. Start to build that referral culture into it.

Ashe: Right, right. Awesome.

Dean: That's great.

Ashe: Okay. Very cool.

Dean: Well Ashe, thank you for sharing. It was great to talk. I think it's going to be a very ... The things that we talked about, even though it's for a very narrow niche, the actual things we talk about apply to so many different businesses, you know? And that's what I think the common thing that people are finding with More Cheese, Less Whiskers, is they're listening to certain episodes and thinking, well what's going to happen here. But then you realize wow, that's totally applicable to me too.

Ashe: Right. Exactly. Yeah.

Dean: Awesome.

Ashe: So it's been definitely an education.

Dean: Well thanks, Ashe. It's been great talking with you.

Ashe: Thank you for your time, Dean. It's been great talking with you and I look forward to following the future episodes of More Cheese, Less Whiskers.

Dean: Awesome, man. Thanks a lot. Bye bye.

Ashe: Right. Bye bye.

Dean: And there we have it. Another great episode and I think to come to that conclusion of just focusing your attention, especially as a local business, on getting people to experience what you have to offer for the first time. And so I think that that's going to think a really cool experiment for Ashe to test out the Facebook ads and see how that can work to bring people in. Especially when you only need a small number of people to fill your practice. Sometimes it's less expensive to get people the result than it is to convince them to give you money to get the result. So if part of it is getting people into your experience, it's often less expensive to invite them to come and have that experience for free.

so I think that if you're in a situation where that might work for you, I'd love to hear what's going for you. If you'd like to be a guest on our podcast here, you can go to More Cheese, Less Whiskers dot com. You can download a copy of the More Cheese, Less Whiskers book and you can click on the Be A Guest link and that will bring you to a place where you can tell me about your business. And maybe we can see about having you on the show to hatch some evil schemes.

If you want to see where the profit activators fit for your business, the best place to start is at profit activator score dot com. And you can get a copy of our profit activator score card and two books. We have our breakthrough DNA book which shows you eight profit activators that you can use to grow your business and a profit activator scorecard book which will amplify and explain how your score works out. So profit activator score dot com. That's it for this week. Look forward to sharing another episode with you next week.