Janelle: Hey CEOs. My name is Janelle Lara, and I am the part time CEO and I am so excited to introduce my friend, Tony Guarnaccia to the part time CEO podcast. Tony has had such a wide breadth of life experiences. He helped his family create a cake business that served Jay Z, that served J-Lo, but did very well. He has also been homeless, and he has also worked for Google. So really he truly have, has experienced the highs and lows that life has to offer. And so today I interview him just on those life experiences on what makes a successful business work and really on what are the values that led him to leave corporate and start his own company. His life story is so fascinating, but what truly sets Tony apart is just how genuine he is. Tony and I were fortunate to be seated next to each other at a conference in New York.
Janelle: And he is just the most humble guy you could imagine. and then he got on stage and started talking about how he was the first person to run ads on a very popular social media platform. And just the, the breadth of experience that he has is so valuable, but you would just never know it because he’s so down to earth, he’s such a guy next door. and he really just proves that you don’t have to be, you know, a shark or cutthroat to be successful in business. So I am so excited for you to hear his story and to get to know Tony better. So without further ado here is today’s episode. Here’s the big question. How do women like us women who want to change the world Women who want it, all women who want to make money, but also be present for their families How do we make it all happen Is it even possible Well, I’m Janelle Laura and I’m proof that this is not just a pipe dream tune in every week to learn my secrets for building multi-six-figure company while working just two and a half days per week. Welcome to the part time CEO podcast.
Janelle: Hey, Tony, welcome to the part time CEO podcast. Thanks. It’s great to be here. I am so excited to have you Tony. We met at M immediate conference in New York city recently, and we were seated next to each other, which was so cool. and you know, something that I noticed about you was you are just such a, like, you’re a, such a, like a guy next door, like you’re so easygoing. You’re easy to talk to. We had lunch that day and then you got on stage and you started sharing your story. And I think the entire room was completely blown away because you have a fascinating story, but you didn’t like it. It’s I love that you didn’t like leverage that while you were like making friends at this event. Like, it’s just, I think there’s just such a cool humility about that. but that is the reason why I invited you on this podcast. Number one, because you’re super awesome. But number two, because your story is just, I think so fascinating. And there are a lot of lessons that we’ll be able to pull for my audience. So anyway, before we get too deep into it, Tony, can you just quick share who you are and what you do
Tony: Yes. So my name is 20 Guarnaccia and my mission in life, really in which we’ll dig into what the story is to democratize marketing. And so what I find is most businesses struggle because they don’t actually understand how to grow their business. And so I’ve taken his wife, learned, working with the top companies in the world and distill that down so that every small business has an equal opportunity. So that’s really my mission life. And I I’ve created all my businesses around that concept.
Janelle: I love that democratize marketing. And so it’s essentially creating equal opportunity for small businesses.
Tony: Yes, because most businesses don’t know what they don’t know. And so they’re unprepared and therefore they fail. So if you look at the stats, you know, is it 50% of businesses fail 80% Don’t make it past eight years. I don’t know the exact numbers off the top of my head, but either way they’re depressing. And so my whole mission is to help alleviate that.
Janelle: I love that. That’s absolutely amazing. Tony, can you let’s just go ahead and dive right in. Can you share, your foundation story Like let’s just start from the beginning
Tony: Fully. Yeah. Happy to do that. So, I grew up in small business. So when I was younger, when I was, gosh, probably 11, 12, my parents started a small Italian bakery. And so like every business people, they have the dream and really, it’s not just about making money. It’s about sharing what they love. My parents love food. I love food, which probably isn’t the best thing, but I’m working on that too. But, so anyway, they, they started this bakery and like so many business owners, they know what they were doing and unfortunately it failed. And then all of a sudden we found ourselves homeless. And so I have a older sister she’s 18 years older. And so we ended up doing is moving into her basement and kind of regaining our, our footing. So we could go back off and start again. So that’s kind of where I started initially was unfortunately with a bad taste in my mouth regarding entrepreneurship.
Janelle: Wow. And so did you end up homeless because your parents have put everything into the bakery
Tony: Yes. They had put all their investments, their savings. they literally, they even sold the house. And so unfortunately everything was,
Janelle: Everything was gone. So what happened next
Tony: So then what happened was I had this, this, as I look it’s interesting, cause I go through this process, I kind of understand myself better and we’re at what got me here today, but essentially what happened was I wanted to redeem that. And so I went off to college to learn, you know, how the actually grow a business. So I went to the university of Connecticut, got a degree in entrepreneurship and thought, okay, I have this down. I know what to do now. So after I graduated college, we started another iteration of the bakery. And this time we were, it was a mail order company and it’s still a cakes. So we came up with a proprietary way to mail cakes anywhere across the country. And so we started that business and we had actually a decent level of success because I did learn some things from college.
Tony: but why Lauren is, you don’t learn everything which I’ll get to in a minute. So essentially we got to a point where we were mailing personalized cakes all across the country. And so we could literally take a photo, put it on a cake and mail it anywhere in the world or anywhere in these, in the United States. And we also had cookies. And so we had, from that, we went to a trade show at the Javits center in New York city and we won best new product. And with that product, we got a lot of accolades. And along with that, we got some great celebrities, taking the, having the cake. So we made a birthday cake for Jennifer Lopez for JZ and from a promotional products perspective. Cause it was also a promotional product. We were mailing cakes to places like Microsoft, Oracle, IBM, all these huge companies. So it was really cool. But unfortunately, because I didn’t know again, why you know, about growing a business, that business also failed. And again, I found myself homeless, but this time I was newly married and had a baby on the way.
Janelle: Oh, so the stakes are so much higher,
Tony: Correct. It got a little bit worse. Cause it was more before it was in my, you know, I was a kid and my parents and I wasn’t as directly impacted now is literally me. Cause I’m supposed to see the provider and unfortunately I had failed again.
Janelle: So. Okay. Let’s pause here because this is so fascinating. How does a company go from making, from selling to Jennifer Lopez Can you just like, are you allowed to say it was like, how much was that cake
Tony: To purchase
Janelle: Like how much did she pay for that cake Just out of curiosity,
Tony: Cakes were, you know, they were a gosh, what was that $39. And then there was shipping. So all in the cake was probably 50, 60 bucks. That’s not expensive at all. No, no. They were small. They’re personalized. The, the main thing was that they could be mailed and they were personalized. So that the big thing
Janelle: Got it. Got it. Got it. Okay. so why did that business fail Like looking back what led to that downfall
Tony: Here’s the thing there’s a great book by Michael Michael, Michael it’s. I think it is it’s called profit first. Exactly. And so he teaches a very valuable lesson that when you grow a business, you have to account for your profit first and then calculate everything else. And so we didn’t do that. And, and, and unfortunately, even in college, I wasn’t taught that because they teach a different way of growing a business. When you’re in college, you’re learning how to, how to work in a corporation. You’re not really learning how to run a business. And so
Janelle: It’s all about maximizing versus optimizing. Right
Tony: Exactly. And so what happened was the shipping prices were prohibit. So, you know, even though we were charging good enough money for shipping when you’re shipping cakes across the country and when you’re using dry ice to do that, the overall costs were too high. And so we weren’t profitable. But then at a certain price point, as the cake goes up higher and higher, you know, people can’t afford it. And so the price was too high. It wasn’t profitable. And then ups and FedEx were raising their cost of shipping. So that was a challenge. And then, you know, those were probably the main factors is just the cost and the understanding. And then of course the cost per acquisition. So the key thing of growing a business is understanding what your cost per acquisition relative to your profitability. And if that ratio is incorrect, you’re going to be a loss before you even begin.
Janelle: Absolutely. Absolutely. No, all of those are very fair points. Okay. So you’re homeless again. But that time, I mean, were your parents kind of up the stream without a paddle as well Or like what, what was kind of the situation there
Tony: Yeah, well, unfortunately, on top of all this kind of the, the real nail, it was my, my father passed away from cancer. So that was, that was tough. So then my mom was pretty much on our own and she ended up living with my sister and we, and then she got back on her feet as well. But yeah, my dad, unfortunately didn’t survive, so.
Janelle: Okay. And so you, I’m so sorry for the loss of your father. and so then you’ve got your, your new wife, you’ve got a baby on the way. What did that, what did that look like at that point
Tony: Yeah, so I said to myself, I gotta get some money right away. And one of the quickest ways to learn how to generate money and learn things is to become a salesperson. So I said, okay, what’s the quickest sales job I can get. So I got a job, selling cars, automotive industry, which I didn’t realize would be a great setup for my future. Amazing. and so what happened was I took that job and the meantime, you know, that wasn’t my passion. I mean, I love automotive and I’m past my cars, but my passion was not selling it. And so in the meantime I was looking to where I can use my skills and I, at the time I had developed a lot of skill in search engine optimization, SEO, and this was, you know, 16 years ago. So back then nobody even knew what SEO was.
Tony: And so there was very little competition for it, which means I actually, I learned SEO to promote my cake business. So I was literally when you play in birthday cake, I was on the top of Google. When you put in corporate promotion and guests, I was on top of that. And that’s also how we got a lot of business. But what I did was when I had my sales job, I was looking for a marketing job in the meantime. And so I was looking, cause I knew I was good at strategy. I was going to data and I was good with SEL. So I said, okay, where can I use those skills And so my thought was, okay, I don’t know how to, clearly I don’t know how to run a business. So who does, who actually knows how to grow a business And I said to myself, well, the best companies in the world know how to grow a business.
Tony: And so I looked at a bunch of companies, I live in Connecticut. And so there was a bunch of companies that have, you know, that agencies that work with top clients like Proctor and gamble and all those kinds of clients. And so I looked at some of those and then what actually ended up going to was a company that focused on automotive because that was a good connection. And so I worked for a small marketing company that did, Mark websites and SEO for top automotive dealerships. And so it was a perfect fit. So it wasn’t where I anticipate going. Cause I had, I was at a fork in the road. I was like, dude, I go directly for these companies that work in an agency that works for these, you know, that serves these massive companies like Proctor and gamble. Or do I go to a smaller agency where I can learn quicker and still work with decent sized companies, just not the size of a Proctor and gamble.
Tony: So I actually went for the second one, a job, literally I started the next day because they weren’t as much need for an SEO person because then one else had that skillset as I was for the job. So I literally started the next day and then I worked my way up. And so what was interesting was I worked with some of the top dealerships in the world. but what, what kind of turned the corner was our company got acquired. And so we got acquired by automatic data processing ADP. And so when that happened, I instantly catapult to working with, you know, that corporation running their business, the business side of the business and also their automotive agency. Also, ultimately I ended up running, you know, Ford motor companies program, and you know, gosh, AutoNation Lithia, major major companies in the automotive space and expanded from there.
Janelle: That is fascinating. So I mean, clearly like God had a hand in this every step of the way, like there was a foundation and then the next step, you know, led you to the next one. And it just continued to spiral what my, my question is, what led you to continue with entrepreneurship and like trying to figure this out because you could have easily been like, you know what, not cut out for this. I’m going to go into finance and call it a day. Like, why did you keep trying to figure this marketing thing out
Tony: I think it cause it’s a passion. Cause you have to have a why a big why. And my why was really to help small businesses. Cause I’m wanting to a, I wanted to see success and why, how do I actually make this work Cause I’m very persistent, persistent. I don’t quit easily. So one, I wanted to figure out myself and there was a certain retention element that, you know, from my parents and then also, I wanted to help businesses so they don’t have to go through the same thing. So it was always a passion of mine to figure out, okay, how do I, how do I actually Tran transfer what I’ve learned now, working with these top companies to the average small business.
Janelle: Gotcha. Okay. So you were just like, it was a re there was a redemption aspect to it. There was a persistence aspect to it. And just kind of like, almost like a puzzle, like you’re like I have to figure this out. okay. So now you’re working with ADP pick up the story from there.
Tony: Yeah. So I’m working with ADP and when kind of a funny story, when the company first got acquired, what happened was the CEO at ADP came out to meet with, the acquisition cause we are quiet. So we are a timely company. We had, I don’t know, 80 employees, maybe a hundred. And so the fortune 500 CEO comes out. And one thing I’ve always learned in life is to make the most of any opportunity you have. And so when he came in, I said, his name is Gary. And, you know, one thing I learned also working with big companies is typically, you know, there’s a certain ego. They’re not at that way, but there’s a certain ego. So I said to myself, how can I take advantage of this in terms of SEL So I said to Gary, I said, Hey Gary, how come when I Google your name
Tony: You never show up. And so he wasn’t happy about that. And so literally right then and there, he had played me to run SEO for the whole company, the fourth. And from there, I’m working with all the executives, literally reporting rain to the CML and it was amazing. And so what was amazing about this is I simultaneously I got business, the business experience because ADP is a payroll company. And then I was also running in the automotive agency, which was, you know, SEO and advertising for all these fortune 500 dealerships. And then later on OEMs manufacturers like Ford. So I started the program for Ford, for, for, for their dealers.
Janelle: That’s incredible. And what I love about that story is the fact that you were brave and you said something to the CEO and it wasn’t like the typical boring pitch. You weren’t like, Hey, can we grab coffee You know, like you were just like very straightforward and said something kind of like kitschy, right. That, that kinda got his attention. And that led to this amazing opportunity,
Tony: Correct Yes. I would not be here with where I am today without things like that.
Janelle: Yeah. That’s incredible. Okay. So what happened next
Tony: So then, so then basically ADP made it another acquisition. They acquired a larger digital marketing company in Seattle called CDK, or what’s actually now CDK was called cobalt and that it was a $400 million acquisition. So I got to actually be on a team and work behind the scenes to make that happen, to do the acquisition. And then, and then once we acquire them, I was on, I was running a lot of their business. So I ran the program for BMW, for, Volkswagen for all the GM brands, Chevrolet, all those companies. And so that was kind of another pivotal moment. So it just seems like there was incremental improvements. And between that time, the, with the program at Ford, I launched a lot of their programs, with Google. And so the part I forgot to mention was I had one Google’s agency of the year.
Tony: And so that happened really as a result of working with Ford cause they helped propel us, propel, even though ADP is fortune 500. One of the things I learned was the importance of JVs joint ventures. ADP basically did a joint venture where Ford got all of their dealers advertising through us and that propelled us to run Google agency of the year. And then also with Google, I had the opportunity to actually, to actually launch YouTube ads. So I was the first person, I believe the first person in the country or in the world, I guess, to run YouTube advertising. And back then, it was very, very basic. It wasn’t like it is today. And then I also launched Google radio, which doesn’t exist now, but Google radio was a pretty big deal because you could buy advertising for a fraction of the cost of what it would take to buy directly from the radio station. So I watched that. And so basically because of those things of the ad spend how much we did with Google and also because of, you know, we are good partners because we launched things with Google. We beta test, we’d meet with them, give them advice. I was on their, their advisory panel. you know, my agency through ADP and I was running Google’s agency of the year back in 2009.
Janelle: That’s incredible that you are the first person to have run YouTube ads. That’s insane. That is so cool. So I have, and yeah, this is all incredible and amazing. My question coming more from like the part time CEO perspective, right Because remembering that you had like a wife and a kid and maybe we were kids, right. What was your quality of life Like during that time while you were like this big shot and all this agency, what was going on behind the scenes for this question So I apologize if it catches you off guard.
Tony: No, no, no. I’m actually very prepared for this one because this was one of the impetuses for me to leave. Even though we acquired the company in Seattle and things were great. I was making more money than I ever had in my life. but I was literally commuting from Rhode Island to Seattle sometimes twice within a couple of weeks and I was getting burnout out and we had just, we had, we had two kids and we had just had an, a third one, my daughter, we had three kids at the time. And so it was too much. And so I said, okay, now’s a good time to leave and go back to my original passion, which was to start an agency. So I started my first company, big fist results of that point. And what I want to do is take all of that. I learned over those past, over a decade and translate it to, to businesses through my agency.
Janelle: Got it. So even though you had all of these, you know, professional accolades and, you know, things were moving and shaking behind the scenes, you knew that the only way that you would be able to have the lifestyle that you wanted was by starting your own business,
Tony: Correct Correct. Yes. Doing it for them company. Just, wasn’t a sustainable thing for me for my own personal goals and you know, like Nile and family, I’m very family oriented, so I didn’t want to sacrifice my family for,
Janelle: I love it. That’s amazing. okay. So talk to me about what that was like leaving and starting your business and about everyone thought you were insane.
Tony: Yes. Yes. So when I left, a lot of interesting things happen, so the timing actually was perfect. You know, I think God’s hand was in it, frankly. and so what happened was they gave me a bonus to stay a very sizable bonus, what a lot of people would probably make in a year. And so I, I took that bonus and that became part of my runway for leaving. And so I took that. so I stayed the required amount of time. And then amazingly.
Janelle: And did they ask you to stay
Tony: I think it was six months. Maybe it was another six months, maybe three. I can’t recall as a while ago. So I stayed there because they need a big thing. When a company gets acquired is the transition. So they want to make sure it’s a smooth transition that everything goes well. And especially with me being on the acquisition team, it was important for that to go smoothly. I ha I did that. And then I came to another pivotal point. They asked me, do I want to move to Seattle or do I want to stay And then amazingly, I said, no. And I actually got laid off, which was like what I was hoping for. So then I was like, this is amazing. Yeah, exactly. I actually, at the corporate level you get severance, so I got severance and then you got apply. So I got basically a year, you know, almost a year salary for a runway to start this.
Janelle: So you got a bonus severance and then like the potential to apply for unemployment.
Tony: Right. Which I never ended up doing. Cause I was getting by then I had the business, but yeah, it was amazing. We had a year runway to start this. So it was, it was perfect.
Janelle: That is amazing. Yeah. That was that perfectly.
Tony: It did. It did. I was so excited. Like no most people, when they get laid off, they’re like depressed. I was like doing jumping jacks. I was like, this is amazing. So yeah.
Janelle: Yeah, no, it’s so true. I felt the same way too. When I got laid off from my job, there was a very happy day for me. that’s amazing. Okay. So talk to me now, let’s kind of move into what you’re doing now. Talk to me about big fish results. I know you’ve got a couple, you’ve got the results loop led you to create that specific agency.
Tony: Yeah. So I started big fist results to help. it’s kind of funny. I look at it when I started, I started before I left, it was originally big fish marketing. Then it became big Fest results. But what I wrote literally, gosh, 10 years ago, when I started it was, it was to provide the strategy tools and tactics to small businesses that, that, that they have at the enterprise level. So even 10 years ago, the vision back then it’s the same as it is today, which I didn’t even realize that until I was [email protected] and realized it’s basically the same. So it was pretty wild. So, so that was it. That was really what drove me to start big fish results. And that’s where it comes from like a big fish, you know, the small, they just want to be like the big fish.
Tony: And so that was kind of the whole idea. I joined the whale, that kind of a theme to it. and so I started that agency and then what I realized is that it was hard to retain clients, so clients would leave. And so I, wasn’t doing a good job retaining the clients. I say, well, why is that And looking back at it, a lot of times it wasn’t us. It was actually the client. And so I realized that they weren’t prepared for marketing. So, so business has to go in, I get these calls all the time. Like I want to start SEL, I want to do ad words. I want to do this. I said, well, why do you want to do that What are you trying to accomplish Do you have, you know, and really what it came down to is most businesses don’t have a strategy or a plan and so no agency can be successful.
Tony: And so that was probably the biggest difference between what I learned at the fortune 500 level. And looking back at, even my own failures, like why, why do businesses fail And really it comes down to not the sexiest thing. It’s like, you know, people don’t plan, they don’t have a strategy. And so because of that, they fail. And so my whole system was built to help alleviate that problem in a way that’s easy to do in an easily understandable. So take something very complex and make it simple. So when I was at the corporate level, literally there were 20 tabs spreadsheets of how we are going to plan exactly everything out. And we would sit in rooms for months, figuring out how this would work. Now, obviously the average small business owner a would never want to do that. And B doesn’t have the time or maybe even the capability.
Tony: So I said, okay, how do I take that and make it digestible into just what, what now is six steps So I took with something very difficult. I made it six steps and originally I did it to help my agency because I said, okay, how do I actually help these clients get success from agency And then I realized I can have a much bigger impact if I actually take resources away from the agency, my focus off the agency and a training company so that this can go out to a much wider audience, which gets back to my mission to democratize marketing, which is the directly impact through the results loop a million businesses by 2026,
Janelle: A million businesses by 2026. Correct. Wow. I am kind of stuck on something that you said earlier that businesses fail because they don’t have a plan. Correct. And I think that, that is so it’s so true. I think it’s so important. And I think it’s so, impactful moving into 2020 and to like a new decade and just, I think a lot of business owners, they don’t have a plan past the next launch plan past if they have a plan for next quarter, they’re lucky. Correct. Right. And so, and I, this is really validating for me because I just did a whole, I part of my accelerator group program, which I am just wrapping up right now. We just did a whole like 18 month planning for them for the 20, 20 into 2021. But it’s amazing how even just asking them these questions of like, what do you want your life to look like in June, 2021
Janelle: And they’re like, I have no clue, like absolutely no clue, which is fascinating to me. Can we dig into that concept a little bit further Because the first thing that I thought of when you said like businesses aren’t ready for marketing, I thought of kind of like the Oprah effect, right So like how, you know, a small business might just be, you know, doing whatever, whatever it is, right. Maybe they’re doing six figures and then Oprah mentioned them. Right. And all of a sudden, even though any business owner would say, that would be amazing to get like a free mention from Oprah. Right. But then their phone starts ringing off the hook, their website breaks because they’re getting so many orders, they can’t handle the growth. And then a lot of them will sometimes even go out of business because they’re getting horrible customer reviews. Cause they’re not shipping things in time because they don’t have the product. Right. And it just becomes like this disaster. Is that what you’re talking about when you’re saying that they’re not ready for marketing or is it something different
Tony: No. Something completely different. And so the Oprah effect is great, but the reality is very small percentage of us we’d get that. In fact, that they were planning that wouldn’t be an issue. So circular argument, but really there’s six factors. I defined that go within the results loop that define your success. Number one, your market, who you do actually want to target. I don’t mean like everybody, but specifically, who do you want to target most people with a niche yet. People don’t typically know that then it’s your products and services. Most people have not properly defined their products and services and what they’re going to do with their market. So, there is a, process we go through that matches your products and your services to your markets. And so there’s multiple things you can do. You can get, deeper, exposure within a market.
Tony: You can enter a new market, you can take your, your, markets and sell different products and services. So there’s, you can actually make a matrix called the Ansoff matrix and that’s a phenomenal exercise. And they only teach that, you know, if you’re an MBA, you’re like most people will never know about it, but it’s a critical thing because you have to map a big part marketing, surprisingly, which is why I created a software company. A lot of that comes down to mapping. So you want to map your products and services to specific markets and vice versa. And so that’s a key part of it. Now the third one
Janelle: I’m actually figuring out the intersection between your market’s highest need and what you’re most qualified to provide. Correct
Tony: Correct. Yeah. It’s yeah. There’s a little bit more to it, but yeah, but essentially, yes, you want to map your markets, but it’s like, think of it this way. I have, if I’m in five markets, so say I’m a local business, I’m in five markets. What would happen if I expanded to six What would happen to explain it to seven So do they have a plan to that You know, so that’s the easiest way to grow or if I’m serving three niches, how do I get to four So that’s what a market is. And so the other factor is your products and services. So do you have, you know, do you have five parks What would happen if you had a six And when I say products, this could be a variation. So if you go in and look at, you know, McDonald’s how many ways can you have a hamburger
Tony: You know, you know, when you look at any of that, so you can take any business and kind of look at their model through this lens. And, and what I created was a methodology called growth compounding. So what’s amazing is if you take each of these factors in the results slip, the six of them, and you do each one of them, you actually get exponential growth because it’s multiplicative. So if you take one market and you expand to two, but then you also have offerings and you do it value, what will happen is actually exponential growth. And that’s one of the main reasons why businesses factor or why a business that’s plant because they, they come out with this very distinctly some of the words, okay, because it starts a conversation. If I’m at three markets, I want to go for how specifically you’re going to do that. It’s not hope, hope is not a strategy. So you have to say, okay, this is what I want. And how may do you know, how many sales am I going to going to get in that piglet market What’s the point
Janelle: Got it. So just kind of creating your projections essentially and, and making them as realistic as possible. Yep. Yep. Perfect. Okay. So we’ve got market products and services. What’s number three.
Tony: So what is your specific value you’re going to offer to that market So this is your value proposition in some ways, but there’s really three levels of value. Your first value is exchanging, and this is how you grow a list. Basically, you want to exchange your attention, your, your audience’s attention exchange or some kind of content. So that’s where you get attention. The next level is getting their contact information, usually as higher value content content in exchange for, you know, they’re enjoying your Facebook group, that’s the, that’s the exchange of value there. And then the last level about who of course is solving their need, which is usually, you know, making some kind of pain go away or helping them to achieve something in exchange for that. You’re, you’re typically getting money. And so there’s three of value. So a dicey proposition goes beyond just the basic value proposition. It’s the specific value you’re providing to each of those markets at each stage. So when they don’t know who you are, you’re getting attention when they know who you are, you’re getting their contact information. And when they are ready to buy, you’re exchanging money for,
Janelle: Or your, your best content or service or consulting. I love that way of thinking about it. Interesting. What are the other three factors
Tony: Yeah. So the other three factors are the three ways to actually grow your business. So those first three are really foundational on the other side of our loop are the three real drivers, which number one is how many buyers do you get So how many actual people can you get to buy That’s where most people focus, Oh, I need to get new buyers. I need to get new buyers, the second leg of the, of the results loop or the, or the, of that side or the results that is the size of the buyer. So how this is usually the lowest hanging fruit, how do you take someone that’s spending $50 with you today to spend 55 You know, it could be increasing your price. It could be bundling a small product. And this is why inventory, your products and services is so important. I met with a chiropractor the other day who wants to grow 10%.
Tony: Literally I met with him for 10 minutes. I said, I mean, it’s not always this easy, but in his case, it was, and it’s like, well, how much do you charge And he made up a number, you know, $50 or whatever, and say, you want to grow at 10%. Why aren’t you charging 55 That’s a great point. I haven’t raised my price in 10 years. I’m like, well, there you go. But it sounds exactly. I mean, it’s really basic things like that, that people don’t think about, but that is in fact marketing. If you go to a marketing school today, you learn product place, price, promotion. Unfortunately, most business owners think that marketing is advertising. And really it’s not, it’s so much more than that. So that’s factor number two is your son.
Janelle: Buyer is essentially the client lifetime value, right So like how much are they going to spend with you over, over their lifetime Correct. Got it.
Tony: Yeah. We look at an annual basis and then multiply that times. Doctor number three, which is factor number three is loyalty. So how long do they stay with you Do you get reviews from them Do you get testimonials So the third factor or the six factor and the results loop is loyalty. So basically it’s your, it’s your markets, your products and services, which is number two. Number three is your value. Number four is the number of buyers then comes the size of buyers. And finally, it’s the loyalty of those buyers. Cause that’s, the loyalty is the biggest. If you study this in depth, which I have a loyalty is the biggest predictor of your future success of your growth. So if you want to look at how fast your company is going to grow. So if you went to a venture capitalist and you look to get funding at that kind of level, one of the key things are going to look at is what is your loyalty What’s your lifetime value And what’s your loyalty. Or a lot of times they use a fancy word. Like what’s your turn rate. If you’re a software company, things like that, but loyalty is the biggest predictor of your future success, but most businesses don’t think about that part.
Tony: That is fascinating.
Janelle: I would love to expand on that just a little bit further, because I’m even like, now that you mentioned it, my wheels are turning because I have a very high client retention rate. I think three of the first four clients are still my clients, but I ever got a year and a half ago. what is it about loyalty that makes it such a predictor of growth Is it just because it’s so much easier to continue resigning and reselling to previous clients Or what is it about that factor that makes it so impactful
Tony: Yeah. Great question. So you’re your highest cost customer or patient or, or, you know, client is your first one, the one that, that just bought. And so your cost per acquisition is, is a lot of times you’re breaking even. And so you want to have a level of retention. That’s going to actually turn them into profitability, you know And so if you don’t have that, you’re not going to have success, which is why any, any professionally run business. And this is one of the things I wanted to ADP focuses on. What’s called a recurring revenue model. So you’re bringing in money every single month. If you don’t have a recurring revenue model, you know, some may say you don’t really have a sustainable business worth anything. And so if you want to sell your business or the key things they look at is, is, you know, do you have recurring revenue loyalty
Tony: And so, and that’s another thing too, the mentioned is like, when you do, when you are starting a business, think about how you would exit the business. That’s a key thing that business owners don’t think about, but when you’re starting the business, like how would you be able to sell it So God forbid, something happens and you have to sell the business. What would that look like What would it be worth And most businesses are worthless because again, if even if they survive, they’re able to knock my business. Even after all of that, which is very depressing. This is one of the reasons I’m doing this is because imagine you’re working 40 years, I see this all, I just saw this with a restaurant down the road, he worked 40 years, 50 years in this business at the end of it, it’s worth basically nothing. You know, this guy down the road, he’s selling a restaurant and he’s going to get basically what the buildings were, which is very sad. And the reason why is because he doesn’t know what he doesn’t know. And that is,
Janelle: It sounds like he didn’t build any brand equity.
Tony: Well, Brandon equi, no loyal customer base. No. You know, in the eyes of an investor. So investor is going to say, okay, how much revenue pulling in how much, you know, what’s the profitability How, you know, how often do they buy What are you getting referrals How’s it growing How you acquiring new. They look at that kind of stuff. And most businesses don’t give it a second thought, which again goes right back to your strategy and your planning. If you don’t have that, you don’t have a business. So, I mean, who wants people don’t think about it, but who wants to end their life at the end of this and really had nothing to show for it. You’re, I mean, at least in the corporate world, you’re gaining benefits and you’re getting, you know, retirement and things like that. Most business owners don’t even have that. So they’re going in blind at the end of life when they’re really at their most vulnerable and they can’t do anything about it. It’s too late.
Janelle: That’s that is very sad. But it’s important to think about. Yeah. So it sounds to me like retention is so important because it offers the lowest cost of acquisition, right If you could just keep a client forever, then it doesn’t cost anything to acquire them. But then also from an investing standpoint, that’s what the investors are looking at is what’s, who’s the loyal customer base. How big are they How much are they spending And what’s the recurring revenue from those customers. Right.
Tony: And the other factor within loyalty is, it’s referrals. So when you have loyal customers, they’re much higher. There’s a, I can’t remember the statistics specifically, but there’s a much higher likelihood for them becoming an advocate, which means they gave you reviews to give you testimonials. And I have a model for this, but essentially at the very top of it is they give you referrals. So that’s the top of the advocacy model. And it’s like, if you’re not getting that, you know, it’s not going to be effective. So
Janelle: That makes perfect sense. Tony, this has been such a fascinating conversation. I know that you have a book coming out, you’ve got amazing things happening. I want to give you an opportunity to share with my audience, what is the results loop
Tony: Yeah. Thank you so much. So the results loop goes over. The six factors that we just discussed is a graphic organizer because you know, people don’t want to, you know, write out these huge business plans anymore. So literally it’s a single piece of paper and it’s actually coming out a new version where it can be a whiteboard. So you can literally take this planning guide, put it up on a whiteboard and collaborate with a team. And so to promote this, we have a book coming out. That’s coming out in December this month, in the next couple of weeks. And then we have a course that goes along with it. So you can do the, the results are on your own because we’re, we’re providing the worksheets. So anyone can go to the website and download them. And we also have models. So we’ve modeled restaurants, how to build their own results loop. We did a version for a business, a business for healthcare. So we have six or seven models that you can literally copy if you don’t want to create your own. But if you do want to create your own, there’s a course as well. And that’s available from the website. So it’s results loop.
Janelle: So the book is the results loop and that comes out in December, correct Correct. And then we can go to results, loop.com and get these like models, worksheets, et cetera.
Tony: Correct Yep. We’ll have the models, the worksheets, everything you need to actually build. One on your own is available there. and then if you want, there’s a webinar or we can learn more and I actually teach on the webinar, how it, how it works and then you can subscribe to that right from the website.
Janelle: Fascinating. I am going to run right over and download everything. I know my audience will as well. Tony, thank you so, so much for your time and sharing your expertise on the part time CEO podcast. If people to connect with you further, should they start at results loop
Tony: Yeah. I have a personal website. If anyone wants to read the rest of my story, it’s meet Tony, jay.com and email me there. The contact information, the form is right there. You can email me. I actually check those personal. So you can go to meet Tony g.com,
Janelle: Meet Tony g.com. Tony, thank you so much for your time today.
Tony: Thank you. Have a great day!