Hi, there this is Rajat here from Startup Frat. Welcome to this blog and today I want to talk about a very very basic concept that you may have seen and heard across different business books. You know every little blog that you read about business always talks about this concept. Which is about creating your own value. This means you have to deliver value or create value for the marketplace for the customer or whatever it is. And for a long time, I could never understand what value is understood product showcase sells a product, sell a service.
What is value? So, I just tell you a story about what I’ve been up to in the last 4-5 weeks? Some of the results that I’ve found doing different types of service on the real-life results that a problem blows your mind. And a couple of ideas that you and I can discuss together. If you want to be a little interactive, we can have a discussion around it and things like that. Now, what is this value pool? Over the last 5 – 6 weeks, what I was doing was focusing on this affiliate third-party seller market.
What is the third-party seller market? Let’s say the company that makes a product or service gets a bunch of people who are not really their own employees and they get them to sell their products and services out to the market. So, you have mutual fund companies who will employ DSA to do you know some of their selling and marketing for them. You’ll have real estate companies or schemes who will have brokers to promote this scheme for them or even brokers of any nature you know just doing retail which is selling somebodies flat for them, or having somebody rent out their apartment for them.
The apartment belongs to somebody else, the brokerage in the middle tries and find customers. You have stock traders or stockbrokers, who you know selling or buying advising people to sell or buy company stocks and things like that. Then you have LIC agents, you have multilevel marketers. All of this third parties stuff means there is a person who has to go out and get
the market, there is the person who goes out and gets the customer. Some people are there who go out and get the customer and there are some actual customers.
A lot of time these middle people work through a network refers even then there are friends and family circle and all of that. So, I was just targeting that market a lot. Got to learn a lot of things, got a lot of different academy students from this background, you know who are working with us now and you know we are learning mutually from each other. The very very important thing from this was that almost everybody is into the blind promotion of their companies’ products and they don’t understand, why it’s not working?
They won’t understand, why it’s not working? Just to give you some perspective about myself early on and you know even during my medical career I had been exposed to the multi-level marketing industry and till today while I don’t have an MBA degree or anything like that. I credit you know a lot of my business knowing that I got in the formative years of that industry. So, I have a deep respect for the multi-level marketing industry, which belongs to this kind of third-party seller kind of industry right?
It was a sad state to see that when I would run service in my life calls. When I wouldn’t serve in my life calls for these people I would ask them at an average how long have you been doing it? They would save into it majority of people would be two years plus. That means they had been in this profession for two years or more that including DSA’s, the agents, brokers, multi-level marketers, etc. And then what is your average monthly income? The average monthly income would be less than 15000. So, imagine somebody being in business for themselves. Why do people get in the business?
Because they want to have a better income. The number one reason for getting into business is to have more profit. And in spite of spending two years in the game here you know. I don’t want to look down upon any income level because I have earned much lower incomes like that than that in my career. But for 15000 in today’s time, I don’t think you can afford a decent lifestyle in any Tier 1 or Tier 2 city of India. Even tier 3 I think will be very very difficult for 15000 rupees income to sustain.
So it’s a sad state of affairs that you get into business. As I had a lot of these people are in the Facebook group I saw them on 925 people over the last 3-4 weeks have joined a Facebook group who come from this type of background. Because that’s where I was kind of targeting my outreach in the last month, month, and a half. So, I am not kind of looking down upon anybody for anything but just looking at the demand-supply situation. Back in the day than that I was exposed to the multi-level marketing industry which was 2000 May 2003, 2004, and 2005 whatever.
If you’re stuck in the game for two years or more you were literally guaranteed to have an income of 30000 to 50000 or more and in those times 30000 to 50000 was a lot of money. So as a doctor, I didn’t make that kind of money in those days. So they said that, If you stick in this game for 2 years or more and you keep working then your income will be 30000 – 50000 or more.
Today the state is that you can keep logging for 2 years or more and if you end up with an income of 15000 rupees then why are you in the business? Why don’t you just do a job? Like any job pay, you like that kind of money. That got me thinking and then you know of course I had good material prepared and some of it resonated with people. Some of it did not resonate with people. Some people were saying, hey you know you should give out your best education to me for free because I am already suffering and you know things like that.
So, let’s just get into the anatomy of this thing. See in today’s market or in any market, in an upswing market lot of people make money but you always got to figure out what it is that I am doing? That my prospect or customer will not have if I were not here. Now what happens in the third parties seller industry you may think that your product is great and it is. You may think that you are the only one who is Infront of the prospect and you may be. But this prospect, let us say this a market of 120 crore Indians. And there is a bunch of investment opportunity in mutual funds, real estate, multi-level marketing opportunities all of that different thing that promise them that they will get rich.
What is the promise? The promise is they will get rich. And you wanna attract them through that promise to one of the vehicles which are mutual funds, life insurance, stockbroking, multi-level marketing, whatever it is in real estate. That is the promise. Nobody ever sells the mutual fund saying you know sell your mutual fund, buy my mutual fund because you may be having extra money. Then the prospect will say I don’t have extra money. Buy a house because this is a beautiful house for you to live in, your prospect will say no is too expensive. So you gotta say, hey it’s an investment, it will grow. That the angle is your money will grow you will get rich.
Now, let us say four or five different opportunities and there are 120 crore Indians. There used to be a time when information was not that freely available. So the people needed to understand the mechanics. The mechanics were explained to them and something called the sales meeting or sales presentation. This presentation used to be 45 minutes to 2 hours long. In that you give the prospect a few aha moments, this is how you can do it, this is how you can do it. This is the various number of options you have and based on that this is my option is the best option or whatever it is.
In those times it was a novelty. The prospect may not have that information or may not have that information in the flavor that you are producing. If you are not there at that place at that time. Now the market was like a waterfall. The water is flowing already. This means people wanna make money already and they are looking for some opportunity already and you are there at the right place at the right time. You show with a beautiful presentation you have your own persona and how to show it? People are like ok this guy seems to be a good guy, let’s do business with them.
Fast forward to today’s time why is it that been two years in this industry the average income level is gone down by 3x? So you were at the top, the water was flowing, you are like a little rock on the side and some water flowed over you. So, you got wet, which means you got shiny on the top is a little water flowing. So, you create some benefit by being at the right place at the right time and providing some value which is this company is endorsed and did not have the kind of reach they have today.
The internet at that time will not available to the extent it is available today. So, this company relies on the trust that you can build in the market putting your face out there. Today how much has the market is changed that people don’t prefer meeting you? Because they don’t spend one hour with anybody whatsoever. Even if there is covid there is no covid. Internet is 100 MBPS in India so it can carry video messages from their favorite superstar which is could be Amitabh Bachhan, Hema Malini whatever and the payment that the company collects can be collected over the internet.
For example, everything becomes easier so you don’t need to be there. The prospect gets no extra value just by the fact that you are shown up at the doorstep. And all the education that are you providing theme all of these bright ideas about how this can work etc.? They already have this information today. All are available on the internet. So you are not providing any real value. So, what do you do should you quit your industry? What should you do? This is where it comes we talk about creating your own value pool. How are you create your own value?
People shall go out and get another degree, I will get one more certification. A lot of people say if he takes your premium program in the Startup Frat academy will I get a certification? The certification not gonna help you. So, what you gonna do is? You gonna have your value pool. Let us say there is a waterfall falling. Have you seen any waterfall? They fall to a certain level, there is a stone ledge over there, maybe there is a little depression and pool forms over there. The pool of water that is formed over here and then the water start falling from this site.
So there is a little pool of water that is formed over here which is holding up. There is no direct you know the water not falling from here that directly there is a stone ledge, There is a little creator that has found with the pressure of water and then the waterfalls in the pool and then the water flows out to the other side. Now this my friends something called value pool. This is something called a value pool. You gotta realize 2 or 3 things. They may be 10 – 20% of people who are buying what you have to offer, then there is 80% of people not buying what you have to offer. Which happens in any selling situation in any industry.
Now this 80% of people, this is the water that falling that making the dent in the rock, creating that little you know that little draught, that little ditch. So, everybody, who says you know whatever the objections are there you know there they fall broadly into 2 categories or probably 3 categories.
Types of Objections
The first type of objection is motivational objection. Why should I go in this direction at all? I want to hold onto my money is post covid whatever. This is a motivational objection. The 2nd technical or logistic objection is how do we do this? how do we do that? Do you know how do we go to the court? how much will the court charge get the registration done? how much of the overhead price to have to pay? How many brokerages do I have to pay in addition? what is my total return on investment on this deal? These are technical questions.
The third thing is literally product and its question which is, what I do have to do business with you? Why don’t I go to 1,000 other people who are pitching the same exact product with the same exact brand? Thousands of people pitching LIC, why should I do with you? What are you gonna give me in return? Why should I do LIC only? Why don’t I go to ICICI mutual fund they probably have a better return on investment? Why don’t I take a depth dead fund? Why don’t I do it instead of doing real estate why don’t I do something else?
So, all of these product-related questions that three types of questions. What you gotta do is you got I have to create value around these. This value is created by three types of products. There are informational products, there are services, and there are packages. Literally, all three types of products and telling you to take zero money to develop there is no money involved. You are not setting up a factory, getting employees kind to produce something.
What you are doing? Creating services around your core product, creating a package with your core product, or creating information around a core production. Now, this information is chargeable information, people will happily pay for information that solves the confusion and their mind. There is so much information out there, that information is just not useful anymore. So, if you create an information product that does a comparison among return on investment, among five different types of assets,s and if you are an age 45 male living in a tier 2 city.
Which one, how should be a product portfolio broken out? Just create an information product and if you charge 500 rupees for a people will be happy to pay. And all you gotta do is just create like an excel sheet of something where there is fill out some columns in the whole calculation is done for them something that.
These are the three types of products that will set you apart from any other insurance agent, set you apart from any other stockbrokers, set you apart from any mutual fund seller, multi level marketing whatever it is. What are services? I have a business which into healthcare equipment ok and the information is available everywhere by would somebody buy it from me? So, what I do is a throw in services and packages, which is, if a come and fix an electric, electrical, and electronic equipment in your house. I will look at some of the other high ticket equipment that is already there and how they say that we will provide you with the complete AMC. If you take our products AMC.
That means we fix a bunch of other things also for you. I already have a workforce running on the ground why don’t I give them more work and pay them more money because I am charging that extra money from the customer. Now the customer doesn’t buy my equipment which is extremely high ticket 300000 to 500000 rupees. I still make money from all of the services and if I provide them good services, they are more likely to buy my product anyway. So I am making money you know two different ways. So everybody says no, I make sure I walked away with AMC at least for all their other electronic equipment.
Do you have AMC for this equipment? Do you have AMC for this? How much do you pay for AMC? Well, I pay an average of 3500 every month. While you take our AMC, we do all of this stuff for you and one-shot will be charged less and they like ok. So, that helps stay in touch with the customer over a period of time. They say you provide a good service; you know I am willing to trust you let’s do this and probably get a product sale in there.
In any event, this is a very good way to stay keep your hooks inside the market because you are already inside their home. So, information services and packages, Now I am gonna give you resources where, how to do this will be given to you. All of the staff is already told you.