Episode #7 – Derek Johanson (CopyHour) on the Three Ways To Grow A Business (with email marketing, of course)

by John McIntyre

Tune into Episode 7 of the Email Marketing Podcast and discover the three ways to grow a business.

Most people focus on #1. Big mistake. In this episode, Derek explains why focusing on traffic can mess you up (and cripple your business). You’ll find out what not to focus on (and more importantly, what TO focus on) to grow your business exponentially.

Derek created CopyHour, an online course that turns pissy writers into A-Class Copywriters. I learned how to write copy with CopyHour and these days I live in Thailand, sip coconuts and mostly just do whatever the fuck I want (which is… make money for myself and others).


In this episode, you’ll discover:

  • What are the three ways to grow a business?
  • Why focusing on traffic (like all the newbs do) is shortsighted and somewhat dangerous (and what to focus on instead)
  • How to raise your prices
  • An action plan for increasing the number of clients you have
  • How to make people buy more stuff (simple but effective techniques
  • Guru burn (and how it affects your business)
  • Why stories are the marketer’s magic wand (and how to tell stories even if you don’t consider yourself a good storyteller

Email Marketing Podcast Episode 1


Intro and outro backing music: Forever More by CREO

Raw transcript:

Derek: Like I said, it might just take one email, one interesting subject line to just bring them right back to you.
John: Hey, podcast listeners. You’re about to discover insider tips, tricks and secrets to making more sales and converting more prospects into customers with email marketing. For more information about the email marketing podcasts or the Autoresponder Guy, go to themcmethod.com/podcast.

Hey, everybody. It’s John McIntyre here, the Autoresponder Guy. It’s time for episode seven of the Email Marketing Podcast where talk about the top tips, tricks and secrets for making more sales and growing your revenue with email marketing. Today I’ll be talking to Derek Johanson, and you’ll discover the three ways to grow a business. Now if you’re like most people you probably focus on only one of these ways of traffic generation, and this vastly limits your potential. Now, traffic is important but it’s not the secret source.

Find out from Derek the three ways to grow your business exponentially with the marvelous power of email marketing and applying some old-school marketing techniques which you’ll find out in just a moment. To get the show notes for this episode of the Email Marketing Podcast, go to themcmethod.com/ep7. Now the sound quality is a little off for this episode. I’m not sure what happened there but I tweaked it with effects to make it as listenable as possible.

Now before we get into that, I have another five-star review to share with you. This one is from Zennerd from the US of A. Here it is, five stars. “John knows his stuff. John knows how to email, you do not. Listen to him to learn how to do it right, if for no other reason than if he can do it so can you. Seriously, he’s cracked the code and he’s doling out bite-sized bits for our mental nourishment. Listen to this man.” Thanks to Zennerd for the review.

To leave a review and get a plug on this episode, head over to themcmethod.com/podcast and follow the links to review the podcast. Don’t forget to add your review, and I’ll link to your site from the show notes and maybe you’ll get a bit if traffic out of it. I really appreciate the reviews, guys. Thanks again to Zennerd. That’s it for now. Let’s go talk to Derek Johanson and find out the three ways to grow a business.

It’s John McIntyre here, the Autoresponder Guy. I’m here with Derek Johnason. Derek created Copy Hour, a course that teaches people how to write copy by handwriting sales letters out. What people do is they get an old school sales letter that has made millions of dollars. They bring it up on their computer and they get a pen and they write the sales letter out by hand. It’s completely crazy, but it works. It’s how I became a copywriter and now I’m living in Thailand, doing all sorts of stuff. It really works. So Derek, how you doing today?

Derek: Things are good. Thanks for having me on, John.

John: Thanks for being here. Now, let’s begin. Who are you and what do you do?

Derek: Who am I and what I do. I guess in the context of this conversation, I am a marketing consultant, mainly online marketing consultant. I help small business owners increase their profits, pretty much as simple as that. I work with a small amount of clients and just handle their online marketing stuff. Then I also have Copy Hour, as you mentioned. I developed Copy Hour to help me help other business owners just increase conversions. That’s what copy does.

John: Learn how to sell.

Derek: Mm-hmm (affirmative), that’s my story.

John: Cool, man. We talked a little bit about this before we just hit the record button. Today we’re going to talk about the three ways to grow a business. If I understood you correctly, there are only three ways to grow a business. Tell us a bit about this pitch concept and then we’ll get into the nitty-gritty details.

Derek: This Jay Abraham’s concept. I don’t know if he was the originator of it, but he’s at least the one that’s brought it to everybody’s mind. If you don’t know who Jay Abraham is, I suggest that you go to his site. It’s abraham.com. He’s got a ton of free stuff for business owners. Basically there’s a concept of his that’s called Three Ways to Grow a Business. Within the three ways there are just hundreds of ways, hundreds of smaller tactical steps that you can take, but the overall picture is basically there are three ways.

The first way is to increase your number of customers or clients, pretty straightforward. You can do this by increasing the number of leads or just increasing your conversion rate. The second way is to increase the value of the transactions. In some business owner’s case, that might just be raising your price. The third way is increase the frequency of purchase. So the number of times that that customer buys from you over the life of that client or the life of your business. That’s it.

John: It’s pretty simple. I remember when I first heard about this, it blows your mind because it’s totally logical yet it’s so simple and straightforward. It makes it really easy to take action because you can look at this and say, “We can work in one or two or three of all of these areas at once and if we do, if we increase conversions in just one of those areas, we’re going to get more sales. If we increase conversions in each one of them it’s going to exponentially increase, 10% in each area will add up to 30 or maybe even 40 or 50% increase.”

Derek: It’s just about keeping things simple, really. It’s just a way to look at all the different tactical things that you’re doing in your business and lump them into different sections. If I’m doing advertising, pay-per-click type stuff, that falls into increasing the number of leads. Then you think, “Okay, if I work on my copywriting or I hire a copywriter, than that’s going to increase my conversion rate hopefully.”

Stuff as simple as number three and three, raising your prices and then also increasing the frequency of purchase or just raising the customer lifetime value, that type of stuff is the stuff that most business owners overlook. They spend just a ton of time trying to increase leads and trying to increase their conversion rate. Mainly, most business owners try to spend all their time to increase the number of leads but they don’t focus on conversion rates actually. If you think about the business in this way it just simplifies thing just down to the basics.

John: When you put this into the context of the internet, most people start a business and it’s always about, “I’m going to get SEO. I’m going to rank my site in the search engines. I’m going to use pay-per-click or any ad network.” Very few people do this. They’re always about increasing the number of customers, clients, which is essentially, “How can I get more traffic to my website? I just want more traffic, more traffic.”

What you’re saying here is that instead of focusing on more traffic, worry more about or focus more on number two, which is increase the value of each transaction, so raise your price, and number three, increase the frequency of purchase. Just make people buy more often.

Derek: Exactly. This all ties into the email autoresponder stuff and email marketing in general, because with email marketing you can focus on parts two and three. With education, with sending people stuff over and over again via email, you can increase their level of knowledge and you can also justify raising your prices in a certain way. Obviously following up with people continuously via email allows you to be in their face more often and increase the likelihood that they’ll purchase again form you. Or even you can send them of to affiliate offers more easily and partner offers with email marketing.

John: Let’s talk about email marketing, how that works in the context of each point here. Number one is to increase the number of clients or customers. You can do this by increasing the amount of leads or traffic you’re bringing in the door or the amount of leads you’re converting from prospect to customer. How does email fit in to this? How would you tweak number one, how would you optimize it using email?

Derek: How would I optimize getting leads, you mean?

John: Yeah, either one.

Derek: Obviously you can do all kinds of stuff, like just simply putting an opt-in on your site, giving away a free course on some topic related to whatever your business is. That’s a way to get more leads in the door, getting people going through some sort of email autoresponder. It’s a great way to vet people. You put them through a course of some sort before you try to sell them anything. In that way, like I said before, you can build up their knowledge and you can justify higher prices when people are more knowledgeable about your product and the benefits that it can provide to them.

A great way to obviously increase leads is to, like a said, make a course, throw an opt-in on your site. It gets more people in the door. What I’ve found across pretty much every business that I’ve worked with is selling through email or at least having that email in place where you’re getting back in their face every day and sending them off to your offers, it tends to increase conversion rates. It can be pretty dramatic, actually. That just fits into that first part of growing your business.

You can increase the amount of people that are coming into your world, you can vet them, in other words you can more qualified people in that autoresponder series before they actually see your offers, and then the conversion rates typically go up with email.

John: If we were to turn this into an action plan, step one is to make sure you get enough traffic to your website. Also, at the same time, make sure that you’re setting up systems to convert this traffic, these prospects into customers. That’s where the email comes in. You add the opt-in form, and you start getting people onto the list with a free course or daily emails or tips or something, some way of getting them interested and have to sign up. That’s step number one. Step number two, increase the value of transaction, raise your price. How are we going to do that with email?

Derek: I think, as I’ve said a couple times now, I think it’s just literally education is the best way to raise your prices. When somebody understands the benefits of what you have, they are more likely to lay down their money and lay down more of it.

John: Give me some examples.

Derek: Some examples of that? I was dealing with a prospect, I guess, I was dealing with a lead to end up using my services. I had very limited exposure with this guy. About a 30-minute phone call, we talked about what he was looking for in his business. He’s selling a book and he’s looking to create a course or he has a course, he has a book and a course. The course is just completed and he’s now trying to get a marketing funnel, get his business going.

I talked to him for about 30 minutes. He came through a referral to me. Basically, I only had about 30 minutes on the phone call with this guy. For me, I really couldn’t really necessarily build up my value enough in this case. When I sent him a proposal it was like a shock to him, the prices that I was going to charge.

Now, if somebody has gone through some of my other funnels like going through Copy Hour and have seen what I can do, and they’ve been exposed to me over a long period of time, and then they come and we have a talk about what I can do for them and then I lay down the proposal, it’s a much different story because over time I’ve been able to educate them on what I can do for them.

If somebody’s listening to this podcast and now they say, “Okay, I want to work with Derek,” or, “I want to talk to Derek,” and we have a 20-minute call on this podcast and then we go and have a 30-minute conversation, that’s still probably not enough. There’s got to be a little bit more exposure. I typically try to put people into a funnel. A lot of times, that funnel is now starting with this Copy Hour course that I have. Does that make sense what I said?

John: Totally. The thing that really shines through is that email is really just about relationships. If people think about it that way, it’s really not that complicated. The way I frame it up is when you meet someone, let’s say you meet them at a bar or in a sporting event or someway, you meet your friend and you get their number. If you call that person once, you’re not really going to be very good friends in a week’s time.

If you call them up each week, “Hey, man. Let’s go out, let’s grab a beer,” and a week later you’re like, “Hey, let’s go grab some coffee. I’m hungry. I want to get some lunch too,” and you do this every week or two, what you’re going to have is a very strong relationship. When it comes time that you need something, maybe you’re sick, you need someone to go and get something for you, you may need some help, you know you’re going to be able to call this guy up, or girl, and say, “Hey, man. I need some help. I need a favor. Can you do this for me?”

The reason that’s going to work after all that time you put into building that relationship, this is kindergarten stuff, this is very straightforward, they’re going to do it. It’s the same thing with email. When someone has built a relationship with you, even if it’s only via email, they’re far more likely to give you their hard-earned money because they think, “Wow, I know Derek, I know this guy. He’s cool.”

Derek: Yeah, exactly. It’s like the dating analogy where it’s like you don’t try and stick it in without going on a date. There’s some analogy in there, but you know what I mean.

John: I know, exactly. It’s like don’t sleep with your opt-ins on the first date. Second base or something like that.

Derek: Yeah, exactly.

John: All right, man. The autoresponder is fantastic for doing this relationship stuff and increasing the transactions. Give me an example. I think you’ve been doing some of this stuff with Copy Hour and some other products you’ve been doing.

Derek: Increasing the amount of times that the customer buys from you, so increasing the number of transactions. For me, I send people to Copy Hour first, they go through the program and then I have a membership site on the back-end of that. It’s called the Cartel. It’s basically for freelance copywriters.

I found an expert, one of our friends, Ed Stapleton Jr., John, who you know. He helped me create some content for freelance copywriters because there are quite a few freelance copywriters that go through my course. After they’ve gone through the process of going through Copy Hour they are sent the ability to buy into the Cartel, which is a membership, a monthly membership.

I think I’m over 10% at this point, of the people that have gone through Copy Hour have bought. So it’s just another way to … email autoresponders … because basically, the Copy Hour is delivered overtime. It’s 60 days, actually 10 weeks of autoresponders. I’m staying in front of these people’s faces. I don’t even have a sales letter. I do now, but when I first launched the Cartel I didn’t have a sales letter. I just sent an email that said, “Hey, do you want to join this?” That’s the power of autoresponders.

Basically, you can increase the number of transactions coming back into your own business but then you can also … If you’re staying in front of people via an autoresponder or email marketing, whatever, it doesn’t have to an autoresponder, you can also tell them about affiliated products. For information marketing it’s great because you can bring up other products, other launches that are going on in your industry. There’s all different kinds of ways. If you’re staying in front of people after they’ve bought from you with email marketing, you can naturally recommend other products and just get people back into your world or send them off to other people’s world. That’s still transaction or you because you’re making money when they buy affiliated products.

John: Coming back to the three ways to grow build a business is, number three, increase the frequency of purchase is make them buy more stuff. A good way to think about it is if you’ve got the attention of all these people who are interested in copywriting, there’s a good chance they’re going to be interested in freelancing stuff, email stuff, all sorts of things related to that.

Because what you have is not copywriters, you have the attention of a demographic who are going to be interested in a range of products. It’s in your best interest and their best interest for you to find relevant offers and give it to them. You make money and they get their problem solved.

Derek: Exactly.

John: Let’s talk about attention, like we just were. Attention is huge, but we have this thing called guru burn. Tell us about that.

Derek: Guru burn. It’s definitely more prevalent in the info marketing world. Basically, you tend to get sick of the guru. Not necessarily sick of him but you tend to forget about your guru after a certain period of time. It happens to everybody. I call it guru burn because you hop around from one guru to the next. What I’ve noticed with myself is that when I stay … I’m still on these people’s lists, my gurus. I tend to follow a lot of different business gurus just because I’m fascinated with business and I’m helping other business, so I need to stay up on my game.

Basically I’ll get an email from one of these guys, I’m on everybody’s list, I get an email in my inbox and I’ll scan through it. It might just take one email from one of these guys, one email subject line that stops me. I read the email and I’m back in this guy’s world again. I’m back in my guru’s world. I think it’s extremely important to focus on attention. Something that you can do is model the new … there’s new stuff happening all the time.

Maybe after a period of months people start to get sick of you, but a lot of times if people are on your list by choice they will stay there for a long time without unsubscribing. It might just take one email, one interesting subject line, to just bring them right back to you. A thing that a lot of people do is they’ll do a month’s worth of follow-up or they’ll do two or three newsletters or something to their customer list and they say, “Ah, this isn’t working,” or they just get lazy and they don’t do it. You’re missing out because it might be a year, two years, before somebody’s like, “Okay, I’m back in your world.”

John: What about … we’re avoiding these guru burns so we’re going to maintain their attention, but when it comes to content I’ve heard a lot of people say stories are the big thing to do. What’s your take on stories and how do you come up with stories to tell?

Derek: I think that stories are huge. I think you can be using stories in whatever business that you’re in. If you have an eCommerce store selling basketballs or if you’re selling a business course or whatever you’re selling, you can use stories to sell your products. It’s one of those things … There’s a book, it’s called “Made To Stick,” that I think everybody should read as well. It’s basically people remember stories much more than they remember arguments of facts and figures.

If you tell somebody stop smoking because you’re 75% more likely to die if you smoke, that’s going to be a weak argument in comparison to telling … I could tell a story about how my grandmother died at the age of 55. Something along that… Don’t laugh, John. Something along those lines. Stories are much powerful. You have the Bible, obviously the Bible’s been around for a while. Jesus has sold tons of books. It’s because of the stories. Stories tend to persuade more than facts.

John: Absolutely. I read a really interesting example recently, I can’t remember where I saw it but it was about when “Top Gun” the movie came out Navy recruitment went through the roof and the sunglasses that Tom Cruise wore, I think the aviators, the sales skyrocketed. That’s just amazing. There was no call to action. There was no copy. There was no long-copy ads or anything. There was just a story. People buy into the story and then they want to identify with it.

I think that’s just a great example. If you’re a good storyteller, you don’t need to be the best copywriter. You just need to tell good, compelling stories that get people to take action.

Derek: Exactly. The thing about stories as well is that you can tell random stories in your email. If you sat down here, I don’t have any real stories to tell. You can tell what seems to be a random story as long as that core message in the lesson or the takeaway of that story is in line with your goal, which is usually to sell something. So that’s something to keep in mind. You don’t want to necessarily get overwhelmed with the idea of having to come up with stories all the time because stories are everywhere and you can just grab from you’re own life.

Maybe you’re in the checkout line and somebody said something that was interesting and it happened, and it’s like a lesson in price justification or a lesson in something else. You can tell a random story as long as the takeaway from that story is something that is going to stick with that person and eventually persuade them to buy something.

John: Cool, man. We’re just coming up to time so we do have to wrap it up. Just to summarize the whole thing, we’re talking about there are only three ways to grow a business. Jay Abraham. Number one, increase the number of customers or clients. You can do this by increasing the number of leads and/or the conversion rate. Number two, increase the value of each transaction. Raise your price, sell bigger products, so on. Number three, increase the frequency of purchase or the number of times they buy. The idea of autoresponders is when we plug this in, we build relationship and we can grow all these three areas so we can create an exponential increase in the revenue or profit in the business.

Derek: Exactly, well said.

John: Cool. All right, man. Before we go, give yourself a plug. Tell people where they can find you and then we’ll say goodbye.

Derek: Let’s stay in line with this conversation and just go to copyhour.com and start the process there. Jump into my funnel and maybe we’ll talk down the line.

John: Write out some sales letters by hand and … It works.

Derek: It does. It’s crazy.

John: All right, man. Thank you. Thanks for coming on the show, Derek.

Derek: Thank you very much.

John: Hey, everybody, thanks for listening. If you want to get more insider tips, tricks and secrets about driving sales and email marketing, sign up for daily email tips from Autoresponder Guy. Go to themcmethod.com/podcasts. Sign up, give us your email address and I’ll send you daily emails on how to improve your email marketing and make more sales via email. You’ll find out why open rates don’t matter and the seven-letter word that underlies all effective marketing and much more.

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