Hey there Rajat here from startup flight welcome to this video the wheels of time are turning again bringing you back to the same place yet another lockdown where the government says if you’re a small business owner if you have a business where your customers have to physically travel to come to you cannot operate your business because it’s dangerous at the same time construction activity can
Go on big buildings with hundreds of workers can absolutely be you know under construction because hey guess what who owns construction businesses is the politicians, yeah but you’re a small business owner you run a brick-and-mortar business you have a shop uh which faces the road or you know you have a shop that’s inside the mall your customers have to travel to come to your store you know then you are a danger
Today we’re going to talk about the lean startup we’re going to talk about the lean startup which has three layers which are message outreach and business house okay message outreach and business house okay message outreach and business house which is what are you showing to your customers are you a commodity business which is like a chemist or Kirana store clothing store or something like that
Where people come you know just because there is a discount just because it’s the season to go out and party so they want to buy some party apparel or something like that or it is based on some commodity need items like groceries and chemists and medical so things like that okay so either you’re that kind of store or you’re a kind of a highly specialized uh business where you attract certain kind of customers and you help them get certain kinds of
Results okay so if you have an architect’s uh office you know which could be in the market or whatever if you have a private practice if you have a travel agency if you have if you run a healthcare business not a chemist business if you run a healthcare business if you run a workshop like a yoga workshop or something any kind of small brick and mortar business were
Your customers come to you specifically because they recognize you they want to get a certain result in life or you know you’re a restaurant owner you know customers come to you because they want to eat a certain cuisine feel a certain way they like the ambiance they like the music or whatever okay then this video is for you know what happens if there are three layers in the kind of lean startup that we propose that you have and it’s very
Essential today that you have this kind of startup only why because it gives you a lot of options in life okay if the first option is that you can get your customers this outreach which is your continuous marketing effort even if you are listed on Zomato even if you’re listed on practice or any other directory service or if you’re doing your own marketing using you know using messaging using Facebook ads or putting in flyers into newspapers
Or something like that then this part is very important to you the outreach part okay the outreach part now what happens is the outreach which is the way you market to your customers is directly influenced by what kind of product line or business house you have okay let’s call it the product line and what we recommend in the Startup Frat model is that you have multiple product lines that are high-profit low
Profit etc and they’re good for different kinds of seasons okay they’re good for different kinds of seasons and this outreach which is what you say and how you reach out to your customers is going to directly determine how much business you get provided you have the right kind of product line okay let me give you an example there are two ways in which a brick and mortar business actually markets to their customers either they have a
The building or an office they have some employees they have a big board outside they may have some flyers in the newspaper they may be known in the local area they may have some banners in the local area saying hey if you need this you know to come to our place etc okay you have a building and employees or you have some kind of what I call an online building
And robots bots and algorithm okay you have an online building and what’s an algorithm by which you get this message out to the people and you know you get them attracted into your product or service okay now building employees could cost let us say rent of about 40 to 50 000 rupees and employees of you know even if you
Have two 20000 rupees each employee that’s another maybe 50 000 rupees so you’re talking about one lakh rupees or spend just to get your business going now if there’s a lockdown you still have to pay the lease and you still have to pay the employees okay that’s one lakh rupees going out of your pocket every single month all right and if you have an online building or bots or something like that it could cost you a fraction
Of that let us say maybe 10 to 20 000 rupees a month and it does the same job okay now choosing the right is very important choosing the correct format is very important if you’ve been in business for a while if you’ve been a restaurant owner who’s only done business through weekend promos through Facebook we have our partners who actually promote us and things like that then understanding this kind of model may be
A little difficult okay most small business owners that come into our community or buy our advisory services or come into our academy programs have this idea that I’m already doing Facebook ads I already have a Facebook page I already pay somebody to put some posts over there and all of that okay and that’s how we do business that is interesting that you have that it is great, okay but that’s not all that’s not all
All of these algorithms etc have to be fuelled so that they constantly attract customers and they constantly gauge the customer’s level of attraction of inter or interest and they have a predictable system of converting a certain percentage of those into paying customers within a predictable form of the predictable span of time okay predictable span of time most seasonal businesses like travel agencies
Most uh kind of uh what you call cyclical business restaurants which make most of their money from weekends from the weekends right, uh it’s different if you have some kind of an up restaurant which is kind of more commoditized and people come almost on a daily basis or if you are in an area which is a commercial area where more of the office staff is going to have their lunch and dinner over there then that’s different but
Most uh you know cuisine restaurant etc they make their business on the weekends most travel agencies they only make good money during the traveling season during the summer vacations etc right so they have given up the thinking to assume that is that this is the way I’ve always done business and this is the way it’s always going to be okay I’m here to tell you that’s not the case now if uh incidents like lockdown then all
Happen you know I get very excited because more kind of it’s an opportunity for me to tell the community the importance of having a demand generation system now what is the demand generation system if you do have this office and employees what do these employees do chances are that these employees either buy a list or buy a database from somewhere or they pick up the phone book or something
They call people, okay and you know they convince them to walk in or something and you know just take a look at your products and services at which point you may have a system where you kind of show them the different options offers discounts, etc and you’re able to get your orders, okay if you’re a restaurant then maybe what these uh folks do is they create posts they put it on Facebook so that you know the social media following stays
Hot and then you probably have ads and offers on the weekend which pull people over to you maybe you know you’re listed on Zomato and you know you have some special offers on the weekend which pull people over to your place okay now how does an uh an outreach program run online how does an outreach program run online you need to have an online building first okay what is an online building it is something which is your space
So when customers come inside that space okay you are showing them something and you’re gauging their interest it is your space when customers come inside your office you know they get to see your flavor they get to see your ambiance they probably get to listen to your type of music in the waiting room then they come and meet you know there’s a certain way in which you create an impression on a customer you need to have an online building these on
This online building could be something like a highly advanced responsive website okay with your own battery of cookies that are tracking the customer’s behaviour on your website okay uh it also needs to have a website or maybe you know some people use basic funnel pages uh or click funnels or whatever it is that is fine okay then you need to have your own cookie system
Which tracks the gradation of a person moving from one place to another then you need to have something called a traffic source is just like buying a list and having a 20 000 rupee employee call them to call that list 60 70 calls the day okay that’s another thing that I covered in my previous video so if you haven’t seen it you can just scroll down and see six-figure blueprint you’ll get the idea of what
I’m talking about when I’m talking about a predictable traffic system which at every point you know that if I pay this much money this many of people are gonna see my business okay and why do I talk about paying money is because you cannot earn traffic that’s another thing I discussed in my previous video just six-figure blueprint if you’re paying this employee 20 000 rupees a month
And they’re working approximately 200 200 hours a month then you’re basically paying them 100 rupees an hour okay you’re paying them 100 rupees an hour in that one hour if they make uh you know five or ten phone calls let us say in 10 hours which is in a thousand rupees they make 70 phone calls which is pretty much the human max, okay and they make 70 phone calls then you’re basically paying 15 rupees
Per phone call, you’re paying 15 rupees per phone call if only one in six or one in 10 phone calls results in somebody actually listening to you and showing some interest that’s 150 rupees per piece of interest now here’s the key difference a lot of traditional business owners assume that if you have a better person calling the customers or if they
Themselves being the owner of the business and highly uh adept at the products and services if they call a customer you know the conversion rate is going to be better and the answer is no it doesn’t matter what module you use to reach out to a customer for the first time okay it doesn’t matter what module you use to reach out to the customer for the first time the mental footprint that you put on the customer’s brain is the
Same regardless of who calls them intelligent person calls them pretty lady calls them, uh a good telecaller calls them manually or a robot calls them or they see something on Facebook and then you know click in or something like that okay it doesn’t matter the first time you ever reach a customer it doesn’t matter who does that as long as those impressions are gained now there are entire agencies okay the entire agencies who are
Specialized in getting first-time attention from customers okay and if you buy that first-time attention using these agencies then you will not be paying 150 rupees per impression okay, you’ll probably be paying one peos two pesos five pesos six pesos 15 pesos 20 pesos at the max maybe one rupee 100 times cheaper than wasting your own life’s time you have only this much time in life you
Have only this much time in the year and you have to get high-paying customers or a battery of low-paying customers at a predictable rate if you want to really sustain your business and really make money at the end of the day, we do business to make money we don’t do business to have a profile saying I’m a business owner I’m a travel agent I’m a restaurant owner oh but article market
But are slower you know after covered I have no money because all my money is tied up here my money is tied up there that is not real business, yeah you’re not you need to grow up okay now how to do this whole outreach program work you need to have your own system which could be your website funnel pages or whatever and you need a traffic source okay and then what you need is a feedback program which basically
Converts these customers into interest into desire and then desire into payments okay interest into desire and desire into payments does that mean that you as a business owner will not be involved in the business no you will be involved but at only the pivotal stages where you have to cut the check for one lakh rupees three lakh rupees five lakh rupees or whatever okay if your customers are averagely paying you about 10 000 rupees you personally actually
Don’t really need to be involved in the sale also your employee can do it your bots can do it your algorithms can do it your online videos can do it not to worry about that okay and then when the customers actually come in you got to calculate what is my cost of acquisition if it takes me 3000 rupees to acquire a paying customer who ends up spending 10 000 rupees
In my first product I’m clearly making a seven two hundred percent markup on my customer acquisition cost there is another thing called lifetime value lifetime customer value to lifetime value okay that means if you have a business house with multiple products and if you have a system where the customer buys one product of yours and then there is a thirty percent
Chance or twenty percent chance that they’re going to buy another product of yours you just spent three thousand rupees to acquire let us say a fifteen-thousand-rupee customer or a twenty-thousand-rupee customer depending on how many different products how many different forms of value you have okay which brings me to my original point why do I recommend people that you should have multiple products regardless
Whether their high profit or low profit is because even on the zero profit products as long as they are easy enough to buy and they create some value within that customer journey you can actually make a profit on them because your customer acquisition cost is zero you already have the customer okay that is the way every big business or every big billionaire in the world
Has become a billionaire, okay you look at Steve Jobs apple okay there is one device that they sell you and regardless of what device they sell you whether it’s the iPod or iPad or iPhone there is a guarantee that you’ll be buying all the other devices within a five-year period yes or no there’s a guarantee you can buy any apple device to start with there’s a guarantee that in the next five years you will be buying two or three of the
Other devices as well okay that’s number one look at amazon number two okay they sell different products which are made by different people throughout the world and all they are specialized in is I have specialized in I’ll find any product for you from all across the world and get it to your doorstep within 48 hours right now what is the average customer acquisition cost may be
Very high which means if a customer orders something worth 300 rupees all the way from Brazil Amazon will find a way to get it over to you and they won’t charge you much for it that means they’ll lose probably three thousand rupees on acquiring a customer, okay but once that customer is in the bag they’re always going to buy from amazon if normal household buys let us leave out grocery’s household
Items lights bulbs you know little things that you know even clothes there’s a high likelihood that they’ll be spending 70 to 80 percent of their money on amazon every year and that is about 20 to 40 000 rupees a month for 12 months yeah that’s two and a half to three lakh four lakh rupees per customer per year what is the customer acquisition cost one time yeah, I once ordered a pair of athletic shoes from
Us and they were costing about 3500 rupees and I char they charged me about 4200 they cost about 50 over there which is about 3500 rupees and I got them over here for a total cost about four thousand two hundred which means they charge over 700 rupees for shipping and everything okay it probably cost amazon much more than four thousand two hundred rupees to make sure they bought it from there and they delivered it to me including customs
Falana dimkana okay but they made sure it was with me and today I am an I’m an avid user of American products I’m an avid user of amazon in India and I buy everything from across the world only through amazon even if there is a store right next to my house, I don’t want to take the time to go downstairs and buy from them I’ll just place an order on amazon and these days amazon gives me same day delivery so if I buy something at nine o’clock in the morning it’s at
My house at two o’clock why would I need to go outside and that’s what amazon says why do you need to go outside yeah buy two and a half lakh three lakh rupees worth of products from us every year and we will make sure we deliver it to you within the same one hour two- or three-hour period okay so message outreach and business house today I want to talk about outreach because every time there’s a new
Lockdown I get even more energized and I bring this message back to you that you need to have an online building and online employees, okay and you need to have the system is not free a lot of people think that Facebook is free I put some posts on Facebook or something like that it’s not free it costs money but you need to have a system that turns that interest into customers into paying customers turns that interest into paying
Customers okay I want to tell you the story of our community member Sachin who actually has a travel agency, okay and in the middle of the lockdown he was wondering how to get customers when the lockdown opens I should set up a nice office so everybody knows I’m here the lockdown open towards June July which is also vacation season people are starting to travel and everything and he said you know I’ll probably have an office and some employees so I can improve my
Presentability to the outside world and that will give me business okay but based on our advice he chose not to do this but he chose how to do this, okay so he said okay we said okay save all this money save the one lakh rupee the month you’re gonna pay and we’ll show you how to get the customers he already had a very good offering online uh he had already had a very good offering in the market and he already had to pay customers but in order to supercharge it
And have people travel during such a trying time when people are actually scared to travel and things like that you know was it was very difficult but he went with this option he set up his online building his online bots and algorithms and today he’s consistently getting six-figure paying customers for his travel deals without having an office okay without having an office so
In the last video, I asked you if you would like to hang out with him just let me know in the comments box you know if you’d like to hang out with him just write let me in in the comments box and I’m going to arrange a meeting with you and him so that you can hear a story and even if you have any other
Brick and mortar business uh you know which is could be a restaurant, uh you know which could be a practice like an architect’s practice or something like that on the ground which is forced to shut down in the middle of the lockdown because hey the politicians can make money construction can go on but you are a threat to society if you’re running your business you know in the middle of the log now right so if
You’re sick and tired of that situation if you have a brick-and-mortar business you’d like to meet this person and understand how they were able to do it it’s all free there’s gonna be no fees for it yeah just type let me in in the comments box and I shall see you tomorrow bye.