338: How To Make Millions As An Artist With Arree Chung

Podcast: Download (Duration: 54:34 — 62.7MB)

The most effective way to sell online courses is to give away a genuinely good free week, then make an affordable offer to the people who attended. Arree Chung ran that loop repeatedly, converting between 4% and 4.7% of leads into paying customers, and enrolled 4,700 students in a single summer.

In this episode I spoke with Arree Chung, an award winning children’s book author and illustrator and a student in my Create A Profitable Online Store course. His first business, a wall decal store, failed. His two education businesses now generate substantially more than it ever did.

Below is the whole progression: why the physical product business failed, how Storyteller Academy started from a Facebook post, and how the free-week funnel scaled to over 100,000 leads.

Key takeaways

• Give away a real free week, then offer a paid version to the people who showed up.
• Conversion held at 4% to 4.7% even as the audience scaled past 100,000 leads.
• Leads cost 50 cents to $1.20, roughly halved by running a viral referral contest.
• Price low and go for volume. $47 for three weeks, then $127 for five.
• Reinvest every dollar of profit into ads and repeat the cycle.
• Memberships beat one-off courses because you stop having to sell a new class each time.
• His decal business failed on marketing, not product. He optimized manufacturing and never learned customer acquisition.
• Customer service scales with digital, not down. He hired 12 people in the Philippines and needed 20.

Why his physical product business failed

Arree built a wall decal company focused entirely on product quality and never solved customer acquisition.

The premise was reasonable. Most wall decals were cheaply manufactured and he could produce genuinely better ones as an artist.

The mistake was where the attention went. He obsessed over quality and manufacturing while spending almost nothing on learning marketing and sales.

Volume never arrived, which meant unit costs stayed high. He manufactured in the US to control quality and iterate on designs quickly, and never reached the scale that justifies it.

Other students in the same course succeeded in the same category. The difference was time in market building a catalog, and he stopped before reaching that point.

What he would do differently with a physical product

Accept losses early to find product-market fit while setting up cheap manufacturing in parallel.

His revised plan is concrete. Print domestically at a loss to learn what sells and at what price, while simultaneously contacting Asian manufacturers and placing a first volume order.

The reasoning is about where your attention goes. Time spent solving packaging and fulfillment logistics is time not spent finding your customer and validating your price point.

He would budget four or five months for that testing phase, treating early losses as the cost of building the pipeline.

Manufacturing domestically is not off the table entirely. His threshold is hundreds of thousands of dollars in capital, below which it consumes too much of the business.

How to validate a course idea before building it

Post the idea publicly and count the responses before building anything.

Arree’s first step for Storyteller Academy was a Facebook post asking whether anyone would be interested in learning to write and illustrate children’s books.

The response volume was the signal. Enough people commented that he emailed me asking what to do next, and the answer was to run a webinar.

That first webinar had roughly 400 attendees and sold his first course. He then ran webinar launches for years, eventually scaling to tens of thousands of attendees.

How to price a first course

Arree priced his first course at around $120 for 12 weeks and considers that too low.

His hesitation was about delivery. First time teaching it, he did not want to over-promise, so he underpriced.

The mechanism that saved it was framing. He called it the founding members price and stated that the next launch would be double, then followed through.

Prices doubled twice from there before he switched to a membership. The lesson is that committing publicly to a price increase makes the increase easy.

Why a membership beats selling individual courses

Selling a new course every time is exhausting, and a membership converts that into recurring revenue.

The problem it solved was repeat sales. Students finished the first class wanting another, which meant building and selling new $300 to $400 courses continuously.

The membership priced at $60 a month or $600 a year against roughly $1,000 for four individual classes.

Renewal is what makes the economics work. Around 60% of members renew year over year, so lifetime value climbs rather than resetting.

Roughly 25% pay annually. Most choose monthly because they cannot pay the full amount at once, which is why affordability drove the structure.

The strategic goal is a library. Building years of curriculum in a narrow niche creates something a competitor cannot replicate quickly without both funding and specialist knowledge.

How the free week funnel works

Run a genuinely valuable free week, make a paid offer at the end, then repeat the cycle.

The first free camp came from a canceled in-person summer camp during COVID. Arree offered it online instead, purely to build an email list.

It ran on zero ad spend. A personal Facebook post asking people to tag and share produced 3,000 signups.

The offer was not planned. Parents asked to pay for more at the end of the week, and he decided over a weekend to build a paid version.

180 people bought at $47 for three weeks, producing about $8,500. That validated the model well enough to start buying ads.

The cadence became mechanical. Three weeks paid, one week free as lead generation, three weeks paid, repeat.

The Facebook ad economics that made it scale

Leads cost 50 cents to $1.20, and a viral referral contest cut the effective cost roughly in half.

The ad itself is straightforward. Name the audience, name the problem, offer the solution. Parents with kids stuck at home who love drawing, sign up for a free week.

The contest doubled the leads. Once someone opted in, sharing earned entries toward prizes including an iPad, and parents shared into mommy and parenting groups.

Arree’s estimate is that for roughly every paid lead he acquired one free through referrals.

Ads ran only during the free week rather than continuously, at $4,000 to $5,000 a day.

Targeting mattered less than expected. Interest targeting worked, lookalike audiences from his customer list worked better, and running with essentially no targeting was only 20% to 30% worse.

How the numbers scaled across four camps

Each cycle reinvested the previous cycle’s profit entirely into advertising.

Camp two spent $7,000 on ads, bought roughly 18,000 leads, and enrolled 800 customers.

Camp three added a presale. Existing customers could save $20 by enrolling early, and a roughly $25,000 ad budget produced 1,800 customers and around $70,000 in revenue over three weeks.

The summer camp was the largest. A $50,000 ad budget built the list past 100,000 and enrolled 4,700 students at $127 for five weeks.

Conversion held steady throughout. He projected lower than 4% at that scale and got 4.7%.

Capacity became the limit rather than demand. Zoom meetings cap at 1,000 attendees, so enrollment closed before demand did.

Why to price a course low and go for volume

Arree priced deliberately below what the market would bear, at $47 for three weeks and $127 for five.

The reasoning was partly ethical. Parents worried about losing jobs needed both affordable childcare relief and something worthwhile for their kids.

The economics support it at scale. Delivery effort barely changes between 100 students and 10,000, so cheap leads plus volume beats high margin at low volume.

His confidence came from the lead cost. Buying leads at 50 cents made the probability of losing money very small, which justified putting every available dollar into ads.

What actually costs money in an online education business

Instructors and customer service are the real expenses, and both scale with student count.

Arree paid instructors well. Summer camp instructors earned $5,000 for a week, which he doubled when the camp overperformed, plus $2,000 more for an additional daily session.

Four sessions a day is genuinely demanding work, closer to performing than teaching.

Support volume was the surprise. Serving 4,700 customers meant thousands of emails arriving at once whenever anything went wrong.

He hired 12 people in the Philippines at peak and says he should have hired 20.

The tooling was a shared inbox system with assignment and personalized canned responses, which he found cleaner than the larger established help desks.

The logistics problems nobody warns you about

Link sharing and email deliverability caused most of the operational pain.

Paid customers shared the class link publicly, letting non-paying attendees into sessions.

The first fix was manual. Cross-reference attendance against the customer list and email non-matching addresses to verify rather than accuse.

The durable fix was unique tokenized registration links per customer, which required webhook and API work to generate.

That solved sharing and not delivery. People still miss the email entirely because it lands in spam.

Putting the session behind a login inside the paid membership is the direction he moved, though launching Zoom from inside a paid area still lets savvy users copy the link.

Digital products versus physical products

Physical products scale through inventory and digital products scale through people.

Physical is harder on cash. Lower price points, thinner margins, and every order funding the next one.

Digital scales the delivery trivially. Selling to ten times as many people is an automated email rather than ten times the inventory.

The cost moves to headcount. Customer service and instructors grow with the student base, and the program becomes operationally more complex rather than less.

Both can be sellable assets. A membership with proven acquisition funnels and multi-year retention is cash flow a buyer can underwrite, which is why Arree is deliberately removing his own face from the brand.

Why removing yourself from the brand matters

Arree is working to get his face off both education businesses so they can be sold.

The parallel he draws is Tony Robbins, who built an excellent business that cannot be sold because it is inseparable from him.

The alternative model is a niche version of a large course library. Proving the acquisition funnels work and that customers stay for years is what makes it acquirable.

That has to be built in deliberately. Retrofitting a founder out of a brand after the fact is far harder than structuring for it from the start.

Frequently asked questions

How do you sell online courses without an audience?

Post the idea publicly and count responses before building. Arree Chung’s first course came from a Facebook post asking who would be interested, followed by a webinar with roughly 400 attendees.

What is the best funnel for selling a course?

A genuinely valuable free week followed by an affordable paid offer. Arree ran three weeks paid, one week free as lead generation, then repeated, converting 4% to 4.7% of leads throughout.

How much should you charge for a first course?

Arree charged around $120 for 12 weeks and considers that too low. What worked was calling it a founding members price, stating the next launch would cost double, and following through.

Should you sell courses or a membership?

A membership, once you have repeat customers. Selling a new $300 to $400 class every time is exhausting, while a membership at $60 monthly with roughly 60% annual renewal produces compounding lifetime value.

What should Facebook leads cost for a course?

Arree paid 50 cents to $1.20 per lead in a parenting niche, and $2.50 to $3.50 in a narrower children’s book niche. A viral referral contest roughly halved his effective cost per lead.

Does conversion rate drop as you scale?

Not necessarily. Arree expected it to fall below 4% when scaling past 100,000 leads and it came in at 4.7%, matching what he saw at much smaller volumes.

What are the real costs of running an online course?

Instructors and customer service. Arree paid instructors $5,000 to $12,000 for a week of teaching and hired 12 support people in the Philippines to handle thousands of simultaneous emails.

Should you build a course business around your own name?

Only if you never intend to sell it. Arree is deliberately removing his face from both businesses, since a brand inseparable from one person is far harder to sell than one with proven funnels and retention.