Audio

003: How Neville Medhora Makes 6 Figures Selling Copywriting Courses Online

neville medhora

I’m really happy to have Neville Medhora on the podcast in this episode. Neville is someone who I met at FinCon by random chance. He bought his conference tickets last minute and he just happened to walk in just as I was heading out with friends.

Anyways, we started talking and I found out that he’s been killing it online selling various info products on his blog at NevBlog.com. In fact, he’s never had a full time job and he’s been making a living off of the Internet ever since college.

In today’s episode, Neville will teach us the secrets on how he’s able sell his products so effectively.

You Will Learn

  • How Neville makes a living online
  • Why Neville decided to forgo getting a full time job to go out on his own after college
  • How Neville hustled his butt off as a teenager and paid for his college education through his side business.
  • How Neville discovered the power of copywriting through his store newsletter
  • How Neville stumbled upon his first info product by accident
  • Why the way your website looks doesn’t matter
  • What it’s important to validate your idea before you start your business
  • Crazy experiments Neville has done to make money
  • Why most people are doing their email marketing incorrectly
  • Neville’s advice on how to make your first sale online

Neville Recommends The Following Books

Neville’s Sites That Were Referenced In The Podcast

Transcript

Steve: You’re listening to the MyWifeQuitHerJob podcast episode number three.

But before we begin I just wanted to give a quick thank you shout out to my buddy Rob Berger who blogs at doughroller.net and he also runs a podcast, which is really awesome by the way, at doughroller.net/itunes.

Now Rob was actually one of the people who helped me nail down the audio quality and audio post processing for this podcast and for that I am very thankful.

Now on to the show!

Welcome to the MyWifeQuitHerJob podcast where we’ll teach you how to create a business that suits your lifestyle so you can spend more time with your family and focus on doing the things that you love!
Here is your host, Steve Chou!

Steve: Welcome to the MyWifeQuitHerJob podcast. Today we have Neville Medhora on the show. Now I met Neville at FinCon last year and it was kind of a random encounter actually. We had just gotten out of an information session and everyone else was actually heading back up to their room except for Neville and I. So we started talking for a bit and that’s when I discovered that he was actually one of the guys behind AppSumo and that he pretty much makes a living selling info products online.

Now Neville seems to be living quite a life… lifestyle in Austin and he basically just lives off of his info products and his blog income. He runs the popular blog NevBlog.com and he sells various info courses that mainly focus on copywriting.

But what actually makes him stand out in my mind is he’s got a tonic character and a toner personality. And in fact by the end of the conference, I kind of gave him the nickname “outspoken Indian guy” and that’s kind of what I refer to him as.

Anyways go check out his blog and you’ll see what I mean. Neville really knows his stuff, especially in the realm of online marketing and copywriting. So welcome to the show, Neville. How are you doing man?

Neville: Hey man, how is it going? I’m glad we’re the only two losers like not going up to our rooms. We had…

Steve: Oh yeah. Yeah, I think everyone else was taking a nap if I recall. So…

Neville: Yeah, that’s what you have Red Bull for. [laughs]

Steve: So can you give us just a quick background story for those people that don’t know who you are and tell us how you make a living.

Neville: Yeah, well ever since like high school, I kind of had that little like entrepreneurial bug. And like I’m Indian, so I was supposed to be a doctor or something, right, and I had a chance to shadow ten doctors over the course of two years in high school. And I realized like that was not for me.

In fact I was voted most likely in the class to not become a doctor and going to computers. Because every time like at the hospitals, they have a problem with their internet – you know back then like internet was more finicky – I’d be like, “Oh, I know how to fix that”. And they’re like, “Aren’t you like the medical intern or something…” “Oh, yeah…”

And so from there I would do a lot of like dump crap on the internet like I would… I would download pictures of cars and Photoshop the backgrounds black, and it’d look really cool for background wallpapers, and then post those online. And then like all of a sudden, to Neville’s cool car archive, all these people were coming.

And I started a bunch of like stupid little things like that and then I was, “You know what I can probably make money with this”. Like a lot of like family friends would be like, “Oh, can you make me a website, we’ll pay you for it.” So I was like… I took a couple of those gigs and that’s when I realized like, “Oh, I can actually make money with these like random skills I have from the internet and what not.”

So I started a little company called House of Rave. That was my first company and it’s actually existed for a long time. HouseOfRave.com. Someone else owns it now and does a horrible job running it. It looks terrible.

But it paid… it paid for my college. It allowed me to graduate from college with like enough money in the bank to live for a couple of years and not have to work. And so, that was kind of nice. Do you want me to go into like how I started out?

Steve: Yeah so… Let’s… Let’s talk about House of Rave because it’s really interesting. You were in high school, right?

Neville: I’ve never been to a rave in my life, like ever.

Steve: Never been to a rave in your life and did you even know how to take… how did you figure all that stuff out?

Neville: It’s… You know here’s the funny thing, a lot of people think it’s just like because I’m smart or something. No, I’m an idiot. I just googled like it’s… I just googled it like I [??], that’s… That’s the thing.

And… And there’s so many more ways to take credit cards now but back then you had to have like an account and… So I had to cosign a bank account with my dad to open it. And then I opened a merchant account.

And then… And then I got a drop shipper, I found someone who’s already selling his rave products and I told him hey, I have this website, House Of Rave, I had already built like a sample of it. And I’m like I want to sell stuff that you send it out. And you know I get a cut or whatever.

And they sent me over an agreement and I was 17 years old. They never even bothered to ask how old I was which is great because it would have been illegal. And so then yeah, I was in business. Like… It was just like I stumbled into it, just like keep pushing through. Yeah.

Steve: How did you pick rave products? I never got that story.

Neville: Yeah, so here’s… here’s exactly what I did and it sounds really dumb. Now I know a lot more about how to validate an idea but here’s what I did.

I took a piece of paper and in my 11th grade tiny male handwriting I wrote a list of 300 products down. And I just basically looked around a room. I was like fans, mirrors, picture frames, furniture, hardwood flooring, like just random things like that, right.

And I just like wrote down every possible product I can imagine and I literally wrote down three giant columns with about 300 products and then I went through each one. Now I was like okay, couches. I was like I’m an11th grade, I don’t know about couches. Couches are expensive. I have no money, so I can’t sell couches. And so I crossed that off the list.

It was actually one of my brother’s ideas for the rave company, it was just one in three hundred. And after I started narrowing them down, I would… I would Google or AltaVista at the time the sites selling rave stuff and they all looked so crappy. And I was like, I could make a better looking website like that. I’m like that was my… that was my validation that I could do a better job.

And so I did. I went out and made a better looking website than everyone else which now I realize doesn’t matter but still I did that. And fortunately I found a supplier and within the first month I made my first order and that’s just how that started.

Steve: So you mentioned that that’s how you did things back then. So if you would do that all over again, how would you change your research?

Neville: Oh man… So… So we… I mean we’ve talked classes and stuff on validating right. And so one… I probably wouldn’t do drop shipping for rave stuff because you could find stuff on Amazon dot… now.

Steve: Right.

Neville: So that stuff’s a little harder. However if I were going to sell products or import products or something like that, what I would first do is I would make a one page, a little landing page.

And so for example I know how to use WordPress pretty well and so if I wanted to be a WordPress designer, instead of like making… buying like wordpressdesigner.com and like making a whole web page and making a portfolio and all that crap, what I would do is make a one page ad and I would probably put this on Craigslist and just say “I make WordPress… I make WordPress sites in front of your face. $20 an hour. Call Neville 7133001146”

And I would put that ad on Craigslist or up on a webpage and tell everyone I knew about it or go to like WordPress forums and say, “Hey, need WordPress help? Blah, blah, blah…” Or I would go to a WordPress… join a WordPress Facebook, I can post there as I need it. Anything like that.

And then if I got bites, like if people paid me to hire me to do my… to do their WordPress stuff, that means I’m doing something right.

If I get a lot of people going like, “Oh, yeah that’s cool. That’s a great idea. Blah, blah, blah… Oh but you know I don’t have the money for it right now, blah, blah.” That means “no”. So that’s called the quick validation. That like you validate by people actually pay you money for that service or product.

That’s what I would do first.

Steve: Ok, so what if you want to sell a physical product, how would you approach it differently? Same way?

Neville: Exact same way! If I was going to sell an app, I’d do the same way. If I was going to sell a service, same way. If I was going to do a product, I’d do it the same way. Yeah.

Steve: Ok. And then once you gather this information, let’s say you get a lot of increase, then you would actually flesh out the site and sell it online?

Neville: Yes. Yeah. So basically if I started getting money and it was… it was almost kind of rolling in, like oh okay, that’s something interesting.

So, so I have a friend who runs a 500 person company now.

Steve: Okay.

Neville: And when he first started in entrepreneurship, like he used to be clueless also, and he had his ideas for Republican and Democrat sandals. So you know how? Like people wear those yellow Livestrong bands?

Steve: Yeah.

Neville: And then some people wear the blue ones to indicate that they’re Democratic and red if they’re Republican. Like I didn’t know that was a thing, but apparently it is. So he thought, sandals with like… they’re like the little fun things or actually the color of your Republican or Democratic party. He thought this was a brilliant idea. And it sounds stupid now but like he thought this is a great idea.

So he had the mold made and he was like… he was consulting with the factory in China to order five thousand of them and he had to borrow money from his family to get them shipped over and stuff.

And he got the idea like wait, before I like blow my family’s money, let me see if people even want these damn things. He’s spent so much time on this.

So he went to this forum where people were telling him that like yeah this is a good idea, you know. He got all that like good idea feedback but no one ever bought.

So then he put a PayPal button for ten bucks to buy the sandals. He tried everything for a month. He posted on forums, he talked to people about it, blah, blah, blah. He got two orders. That’s it. Twenty bucks. And he wasn’t even making a profit on these. So he /

Steve: Yeah you know, that’s… that’s totally true you know. I tell the people in my class never place a bulk order overseas unless you’ve actually tested it. You don’t even have to have the items in hand. Just try to sell them and if you can’t get them, you know you can just buy them from a competitor and ship them.

Neville: Yeah, could you imagine what would have happened if he… if he did that? Like he would have spent thousands and thousands of dollars of borrowed family money and not been able to move it. And he’d be stuck with like five thousand pairs of red and blue sandals. I mean it would… it would be ridiculous.

And so fortunately he was just like, “Okay, clearly no one gives a thing about this product. I should move on.” And that’s what he did. That’s how you validate a product.

Steve: Nice. Nice. So just curious, from my knowledge, did you ever get a job out of college or you’ve been doing this since college?

Neville: No, I’ve never really had a job. Yeah.

Steve: That’s amazing. I wonder what your parents would have said about that. Did they give you a hard time?

Neville: My parents are pretty cool. I mean they… they weren’t obviously excited, two Indian parents are not excited when you say you’re not going to get a job out of college. Right.

Steve: Yeah.

Neville: You’re either expected to do some further education, law school MBA, something like that. Or get like a good job to get an experience.

So my mum and dad really wanted me to get experience in the corporate world first for a few years and then do this. But I was like, “Well I’m already kind of like on a roll. I’ve got enough money saved up, I can live by my own. So let me try it for a year or two. And obviously it wasn’t their number one option but they never liked pushed back too hard on me.

So I did that and then when they realized I was actually making like more money than my peers that had jobs…

Steve: Hmm-hmm…

Neville: …they were like “okay maybe you know… maybe he knows what he’s doing.”

Because I always thought for myself that with my current skills and my current education, I think the maximum amount of money I could get from a normal job, not knowing what I know now, would be about 75 000 a year.

Steve: Okay.

Neville: Yeah, that’s about 3 500 a month after tax. And I always thought like if I can make more than that, then I’m golden. Like that’s… This is a better option. And I’ll have more fun and I don’t have to go into an office every single day in my life.

Steve: So just like a frame of reference, how did you do last year, in 2013?

Neville: 2013 was a weird year because one, I didn’t really do much. I was just kind like a coasting year. So I did obviously over $ 100 000. But the previous years I did really well. That was… I was making doctor money, yeah.

Steve: Okay. Nice. So multiple hundreds of thousands of dollars basically.

Neville: Easy. Easy, yeah.

Steve: Ok.

Neville: Yeah.

Steve: Ok. We don’t have to go in the detail but I just want to give a… you know kind of a frame of reference for the amount of income that we’re talking about. So…

Neville: 2013, I made sure I didn’t have any deadlines ever. And you know what that did, it made me lazy as hell. Because when I…

You say like implement deadlines for myself, I tell someone over at AppSumo, I’d be like, “Hey, you know I’m going to put this product out on October 27th.” He’d be like, “All right, we got it March for October 27th, it’s going to go out to 500 000 people.” And… And that would put pressure on my ass. And whenever I got rid of that, it totally backfired against me.

Steve: You know, so for the last year, then you’re just kind of coasting on the products you’d already had on the market?

Neville: I’d still make money every month. It was like why did I even have to work?

Steve: Yeah, that’s a great lifestyle, man!

Neville: No, it’s… it’s one of those funny things. There was… A few years ago, me and Noah took this trip over… Noah is the founder of Face… he was like number 30th of Facebook, he founded AppSumo also.

We took a trip together in New York and we’re sitting in like this fancy smashy coffee shop and… and we just did really well that month and those previous months, right. And I had made like 50 grand that month or something just in pro… profit from like what I’d done before. And it’s just… you can’t even spend that kind of money.

And… And we’re sitting in a coffee shop at 2 PM on a Tuesday. I looked at him and I was just like, “You know what? This is it. This is what everyone dreams of.” Like we’re both like 29 years old, we’re making a ton of money. We’re… We both live in Austin but we rented a cool condo in New York. Like this is the dream that everyone wants.

And that… that satisfaction lasts for about a minute. And then you’re just like “Huh, it’s time to get back to work”.

Steve: Chuckles.

Neville: That’s just how… It’s like… It’s… It… You can coast and everyone thinks like, “Oh, but that’d awesome.” But like in reality, you still want to do work.

Steve: Yeah, you know that’s how I feel right now which is why I’m kind of doing this podcast even though if I still handle… I’m juggling all these other things. I don’t want to get bored. That’s… That’s my greatest fear. So…

Neville: What’s the point?

Steve: Yeah you know… So Neville, you know what I like about your blog is that you walk the talking. You actually go out and try a lot of these things on your own.

So if you want to just give us some crazy stories about some of the crazy experiments that you’ve done to make money, to get up to this point that would be great. I think the audience would be… would love to hear about that.

Neville: I… Some of my favorite stuffs is the stuff I’ve done with homeless people and this is… this can go both ways with people. Some people get really offended, some people are amazed.

So, one of the things was I used to past where I used to live, there… there was always this one intersection with all these homeless and I go to India all the time and see real, like excruciatingly bad poverty. And so whenever I see the homeless people here, I’m always like, “That’s just like an untapped labor force.” And… And like that… that opinion is really unpopular with people, right? They’re just like “Oh, there’s mental illness, you know. You come from a good background, they don’t.”

Fair enough. But I was just… I was thinking, can you teach these people to be like entrepreneurial, maybe no one has ever taken them by the hand and shown them. And so I thought, well you know there’s a guy standing on a hot corner in Texas, on a hundred degree day, what if they sold like bottled water or something.

And so I came up with this thing called “The Bottled Water Experiment” where I wanted to get me and a bum to sell bottled water on the side of the road. And I did not know how this was going to go. I was a little embarrassed to do it because I was like man, what if my friends see me, like I’ll look like a bum, and all that kind of stuff.

Anyhow, I lugged over in my car over 20 lbs. of ice and 120 lbs. of water… sorry, sorry, not 100, just one pack of water. We had a 24 pack of bottled water and me and a bum sold it all out in less than 30 minutes for $1 a bottle.

Steve: This is on the street corner?

Neville: On the street corner.

Steve: You’re crazy.

Neville: Like it wasn’t even at a busy time of the day and it’s just like… and it wasn’t even a hot day. And it was a cloudy day.

And so everything was against us but we sold the stuff like hot cakes. And… And the guy was so thrilled they made money so quick and he was just like, “Oh, it’s more than I make like you know bumming for it.”

And so we did it like ten times together. And… And si I got this bum to become like a water entrepreneur quite a bit.

And then it turns out he got a drug problem with the jail but other than that, it was successful.

Steve: So you actually kept it up for a while after you guys stopped?

Neville: The problem was lugging… for someone without a car, it’s very difficult to get 120 lbs. of ice and 120 lbs. of water in a cooler up to a certain place. The logistics of it are very, very hard when you actually try it.

And people are always like, “Well, why didn’t you just take a cab and blah, blah, blah…” It’s like “Dude, okay, you try it yourself first and then come back and tell me.” It’s very, very difficult.

So we could continue doing it forever but the point of that was on my blog a lot of people used to say like, “Oh, the only people that can get rich are the people with money. You have to have money to make money.” And I was like, “No, you don’t!” So I bought a $5 thing of water and sold it for $24 and I was just like “There you go, that’s reseed money. Now repeat!”

Steve: Nice, that’s… that’s a great story.

Neville: Yeah. And I saw the financial blogs of the time were always like, “Well, I’m going to do a money experiment. I’m going to sell my TV on EBay.” It’s like, that’s not an experiment, that’s selling your stuff on EBay.

Go out there and do stuff. And that’s what I used to do. That’s why people liked it.

Steve: I get a lot of excuses like that too and they’re just excuses, right. You don’t have enough time to do stuff. You don’t have enough money to do stuff.

Neville: I live in this area, I can’t do that, blah, blah, blah. There’s al… There’s always excuses. Yeah.

Steve: So how do you go from selling water and rave products to some of your info products?

Neville: It’s kind of like everything else. It’s just kind of a mistake, like people think there’s a grand master plan to it. Like I’m sure even your blog and everything was just kind of like almost a fluke sometimes you know, like you start something and it just takes off.

And so what happened was with House of Rave stuff, people kept asking me questions about like: Dude, you have this business that spits off a couple of grand a month and you barely do anything for it. Like, how do you do that?

And I’d be like, “Well, I just drop ship.” They’re like, “You don’t even carry inventory?” I was like, “I’ve never even touched any of my products before.” And so people were fascinated by that.

So I wrote a series called “How House of Rave works”. And if you type in “How House of Rave works” on Google, you’ll find a free series. And this is a six part blog posting and explains from start to finish how I did it.

But then people wanted more info. They’re like, “No, I need more, how do I exactly find a supplier? How do I do this?”

And so I told people this in my marketing community and they’re like, “We need to make an info product about that.”

And so I kind of begrudgingly made it and you know just took a month and did it. And then I sold it for $37. I have no idea why, that’s just some random number I thought was fair. And low and behold, I got like 30 and something orders on that first day.

So 37 times 30, it was like a grand or something I made in a day, right. And I was like “Wow, I made a thousand dollars from my blog in one day! Like that’s pretty impressive.”

Steve: So where did you promote this? Only on your blog?

Neville: With literally a blog post with a PayPal button at the end. That’s it. Like there was… there was no pictures of it, I didn’t show the backend, I didn’t show what the videos looked like. I didn’t make a video intro.

I literally just told everyone like: “Hey, everyone’s been asking me about House of Rave, blah, blah, blah. Here’s what I’m going to show you and here’s what it’s going to go through.” And split bullets points of what it is. And then it’s like “If you wanted to buy it, here’s a PayPal button. Buy it!” And that’s what I did. And it sold all those copies.

And still to this day, somehow people find that blog post and order it. And you want to find how to get away with it Steve? People are like, “Oh I heard you make like a fulfillment system and blah, blah, blah…” And I used like Gumroad and you know all these other things you can do.

But all I did was whenever I get an order, it comes to your PayPal… If you get sent money on PayPal, it comes to your email inbox. So it will say like, “Steve Chou ordered House of Rave Behind-The-Scenes for $37,” I literally would copy and paste the logins in that email to the people.

So it would say “Download instantly” but in reality it was just like me waiting by the computer.

Steve: Laughs.

Neville: It was. And I just waited there all night just kind of like fulfilling orders. That’s how ghetto it was. And people never complained about it. It’s ama… Still to this day, I got two orders from it yesterday from that random blog post I don’t even know how. So I made a total of $73 or something like that from something I did in 2011 that doesn’t even have a system associated with it. I mean it’s kind of ridiculous how you can make money like that.

Steve: You know I run to this all the time with the people I interact with just on the blog. People are all concerned about setting all these complex systems and getting everything in place when they haven’t even tested the product or anything yet.

So oftentimes, you know from what I’m hearing from you, is you just get something out there and try to sell it first before worrying about all the infrastructure.

Neville: Yeah. Because there’s a lot of people that do it the opposite. They spend all this time getting all the stuff in place and hiring a developer and all that kind of crap. And they try to sell it. And then they realize, yeah, no one gives a sh… no one cares about your netting program because you have no audience members. And… And you’re not hitting the right nerve.

See, mine was pre-validated. People were asking me every single day via comments and by emails about House of Rave. How do… And they asked the same questions over.

How do you find a supplier? How do you know the supplier’s legit? What kind of deal did you get with the supplier? How do you start… What… What platform did you use to put your ecommerce thing up? How did you convince the supplier to let you get a good deal? You know what is your deal? How many orders did you make a day? How much money do you make per month from House of Rave?

Those were the same damn questions I got over and over. So I literally made a video about each question.

How do you find a supplier? I saw down with my Canon Elf, you know like a $200 camera from Walmart, put it on a stack of books and started recording in my apartment.

And then for like “How do you find a supplier?” I was just like “Well, there’s this method on Google, I just looked… searched for people that are already selling it.” So I took Cam Tage or Screencasts of me just like going through Google and looking for rave products.

And each video was only like three to seven minutes long, like they didn’t need to be that long. And so the whole course, the total runtime was like two hours of video max you know, like nothing more than that.

I was like I have about a two-hour time span for attention, I assume other people do too, I won’t make it longer than that. And then I sold it, like it was… it was that simple. Like I was so ignorant to what could go wrong that I just did everything right.

Steve: Yeah, that’s… that’s hilarious. So, how do you transition to copywriting after that?

Neville: It’s just kind of like one of those things, like I studied marketing and I would read J. Abraham and I’d read all these different books. And I read a book about David Ogilvy and then my friends would tell me about copywriting.

So one of my friends was like a good copywriter. He’d be like “It’s crazy, like I can send out an email and make tons of sales. But if someone else sends out the same email newsletter in a different format, it won’t make any sales.”

And I was having that problem with House of Rave.

At the time I had 7 500 previous customers. Every single email address on this list had spent money with me already, right. Right. This is like a money list. And I would send out this newsletter and no one would buy a damn thing. People loved clicking on it because the pictures were pretty and I would… I would take all the pictures myself and put these big buttons on it.

People clicked on it but no one bought anything. And I was just like, I guess this is how email marketing works, like you send out an email and no one buys anything. Then I started studying The Gary Halbert Letters particularly the Boron Letters chapters 1 to 25.

Gary Halbert Letters, Boron Letters, chapters 1 to 25, print them out and read them. They’re amazing and they’re free! It’s… It’s like the best educational copy in marketing you’ll ever, ever get.

And so I started reading that. I started reading Joe Sugarman’s book, “Advertising Secrets of the Written Word.” I read David Ogilvy’s books, watched everything I could find on YouTube about all those guys. And then I wrote, with the help of a friend, like a professionally written, copy written sales pitch for these finger lights which were our bestseller at the House of Rave at the time.

And I’d run a sale on them before but they didn’t really sell that well. But then I realized like when people would call and ask about these finger lights was, I’d find just ravers you know going to a party and doing drugs would… would use these. But no, that was not the case.

The people buying them were party planners, wedding planners, plumbers so they can see stuff under a sink by putting the little finger under to light, people give them to their autistic children to calm them down – that was really interesting, I never thought about that. People give them to their children to keep on their finger in case they see a monster under their beds so they can check for monsters under their bed.

I mean it was like the most bizarre thing. Like everyone was buying these for the weirdest reasons. And so I wrote that in the email and I also wrote that I was like overloaded in stock with these things which was true, and I was going to sell them for a crazy ass price. Within two hours of sending off that email, I got 120 orders.

To give you a frame of reference, I was making only 10 orders per day on average and I just got 12 extra within two hours. Like I was out of the product in like an hour, I had to refund a lot of that money. But I made a tremendous amount of money that day and a tremendous amount of orders and people were like begging to get this… to get this deal.

And I was like, okay the only difference was the copy. And so that’s when I was like okay… something clicked in my head, I was like if you write something in a different way, you can get people to buy it, if it’s a good product in the first place, you can’t sell shit.

Steve: Wait, so how did you find out what people wanted or what they were using these finger lights for?

Neville: That was just over the course of the years just selling that kind of stuff, how people would email you know being like, “Are these okay for children?” I’d be like, “Yeah why are you… what about your children using it for?” I was just asking questions. And over the years I just kind of collected a mental list of like what people were using that for.

And I would tell people stories, like I even told my copywriter friend who helped me, he was like, “What do people use these for?” I was like, “Dude, you won’t believe this, like autistic… autistic children get calmed down when they put them on and wave them in front of their face. Plumbers use them.” Like I had a plumbing company buy them for all their plumbers. Party planners buy tremendous amounts of them. And he’s like, “Well, it seems like you’re gearing these just towards ravers. Do ravers buy them?” I’m like, “No, ravers are 16 have no money, they don’t buy sh…”

Steve: Ha!

Neville: Yeah. So he’s like, “Yeah, so gear this towards a different audience and show people what they can use it for.” So even if they don’t really need them right now, they’ll be like, “Wow, I could totally use this.” Even when they get this email they weren’t planning on buying finger lights, they may have a kid and they may be… their kid may have like a fear of monsters under his bed and this might be a way to get the kid to go to sleep better if he has a little flashlight on his finger.

Steve: So your before… walk me through what your before email looked like so I just get an idea.

Neville: Yeah, let’s see, where’s… where can you find that? There’s… There’s a blog post on NevBlog. You search in “NevBlog House Of Rave quick sell experiment”. If you Google that, you’ll find it.

Steve: Okay, I’ll go ahead and link that up in the show notes but yeah it’ll be interesting to see the before and the after and just you know correlate the dramatic difference.

Neville: There’s full pictures of the entire things. So what… what I’ll try to quickly explain it.

The… The before was like basic… you know you get an email newsletter from like you know Blahblahblah Store and you know from Bose… not Bose, it’s actually good… You get from like Rick Stone or something, they just have links to a bunch of products, you know?

Steve: Yeah.

Neville: I… Buy, buy, buy this crap, buy this crap, you know. That’s kind of what it was. It was… It would be like finger lights, there’d be a big picture and then there’d be a Buy Now button. And it’d be like these are great for putting on your fingers and like that’s all it said. And then there’d be like this disco balls, like “Spruce up your next party with a disco ball. Buy now!” That’s all it would be.

And so basically I was shoving a spam email in your face and be like “Buy, buy, buy, buy, buy, buy, buy”.

Instead, the after product was like, “Hey I got to tell you about these finger light things, you may think these are just for 16 year old ravers doing drugs. But let me tell you the real uses that I have seen with these. And then I’d go into the whole plumber thing, the autistic kids thing, the monsters under the bed thing, all things like wedding planners using them, all that kind of stuff. MTV bought some to like make this Alien show or something like that.

And so, then when people saw how many uses they had and that this is a useful product, more so than just like you know a little dance toy that you could take on a campout or anything like that, that’s when people were like, “Oh, I’ll spend $1,98 on a piece to buy them” you know and that’s when people bought.

And then I also made it like a scientific to where I’d create scarcity. I’m like, “We’ve never run a price this low and a promotion as big for these finger lights. So I don’t know how long these are going to last. There’s only 500 of them and to give you an example we sell 50 of them every day on average. So with this special price, our product is going to sell a lot more. So you need to get them now and it’s first come, first served.”

And that was true, the first orders got them and the rest all had to be cancelled.

So I did that and that sense of urgency also helped people. And you know that’s like part of copywriting you know. If you have urgency in the thing, people are more likely to buy.

Steve: You know, what’s funny about all this is I’m actually on the newsletters for a lot of the big buck stores you know, just so I can see how they do and get ideas. And almost all of them pretty much just list their products with links and Buy Now. Occasionally some, they promote sales and a little bit of scarcity here and there. But they don’t really tell stories around their products. So why do you think that those guys just aren’t doing what you’re talking about?

Neville: Oh exactly why… And David Ogilvy in “Ogilvy on Advertising” talks about it perfectly. Or you could just google David Ogilvy and watch some videos of him.

The big companies, they go with agencies, design agencies, advertising agencies and the people they employ are all designers. They’re designers, graphic designers, they want pretty pictures. They did all the stuff that I thought was good and.. .and you know they’re not… they’re not idiots or anything. They just have never studied the scientific way to sell.

And so, they’ll put pictures and they’ll be like, “Oh only 0.005% of people are buying that’s normal. If we can get 0.0001% of people that buy, we double our sales. That’s good.” But they never tried like specific sales. For example the big… the biggest box… or not box retail but retail I like is a Bose, B.O.S.E., you know the sound company?

Steve: Yeah. Uh-uh, yeah.

Neville: Like tons of Bose stuff, and they have really good emails. They don’t look like traditional newsletter style email which automatically is seen with spam. They actually talk about the product and why you can use it, and how you can use it, and how it connects your phones so easily. And they actually give you a whole like proper sales pitch.

So like, I was actually interested. Like I try to listen to podcasts in the shower all the time but like I couldn’t hear my phone in the shower, like… like the shower was too loud. And so I was like, “I could use a speaker but I’ve tried like the Jambox and crap and they suck.”

And then like I got an email from the Bose company and it was just like, “This is perfect for this, it links up immediately with your phone, blah, blah, blah.” I was like, “Oh, I’ll give that a try.” And there’s just like a whole like explanation of why you should buy this. Not just like “Hey, buy, buy, buy!”

Like you know they just don’t stick a picture of the speaker out there and say “Buy!” They give you reasons and justifications and uses for you to buy.

That’s… That’s what I teach in the copywriting stuff. There’s like formulas you can follow that will automatically make you have a better sales page than anyone else. It’s… It’s so easy sometimes.

Steve: That’s interesting, I… I’m just curious why these… these stores with such a big budget don’t just hire copywriters for their emails because you know like… like you said, they’re horrible.

Neville: You get a copywriter that works at an agency and they write, you know it’s… it’s some girl that gets paid $35 000 a year to sit there and write copy. And she… she’s never studied direct response. And agencies go based off of who wins the most awards for their email, who does the most creative pictures and stuff like that.

So the agencies go based off awards because that’s what they want, because that gets them more clients. Whereas direct response marketers such as like you and me, we’re more direct response, we just want the damn result. We don’t care how it looks. My emails are ugly man, they’re ugly but you know what? People read them and they don’t get distracted and they sell really well.

Steve: That is really great advice. Yeah, I’ve… I’ve actually read your blog quite a bit and I watched some of your videos. You’re… You’re personality really comes through and you just get to the midst of things and apparently it’s doing really well for you.

Neville: Yeah it’s… and like this is what I teach, like this is what at KopywritingKourse.com, you go there and sign in for the newsletter, within the first three newsletters I guarantee your mind will be blown by some of the stuff I teach you. That’s awesome.

Steve: Yeah, I definitely have to link those up in the show notes. So what do you plan on doing? I know you have a couple of different copywriting courses right now. So how do they… how do they differentiate it right now?

Neville: Hu, plug times, I’m gonna get…

Steve: Do it, do it! You got me intrigued.

Neville: I’ll… I’ll tell you the free stuff too that you can do.

Steve: Okay.

Neville: I would suggest to start… If you don’t want to spend any money…

Steve: Ok.

Neville: I’m going to give you the free stuff first, so kind of shooting myself in the foot, but it’s… Google the Gary Halbert Letters, Boron… Boron Letters, chapter 1 and then print out chapters 1 to 25.

Everyone I know who read the Boron Letters and prints them out usually ends up going someplace and making a lot of money, like that is just the… the plain truth I have seen. The people that are like, “Oh, I’ll just skim it online, blah, blah, blah”, like those people, they don’t do anything. They’re screwed up, they don’t do anything.

So like I have a big stack of them sitting by my bed to this day and I still reference them. That’s the great free way to start.

The other free way to start is go to KopywritingKourse.com… K, like Kopywriting with a “K” and course, the “K”, and sign up for a free newsletter, you’ll get everything free, it’s awesome.

The next way, and this what companies force their employees to watch and they… all the employees say like it’s the best thing they’ve ever watched.

The KopywritingKourse.com, you can actually buy the copywriting course, it’s just like $69, it’s crazy cheap. And it’s a set of videos specifically designed to make teach you copies. And it’s super, super quick. It’s less than two hours.

I suggest you have a glass of alcohol or tea or something like that and watch it. By the end, everything you write will convert higher, I guarantee. Full money back guarantee on that.

And the cool thing is what I didn’t realize when I made that, you’ll be interested in this, I thought it was going to be for like startups and stuff like that, the people who benefitted them most were sales people. Because sales people cold call all the time and they’re like “Buy my stuff, buy my stuff, buy my stuff”, that’s all they do. But then when I show them, “Hey, hey, use this brain hat to think about this differently.”

As soon as they watch that first video, it changes their whole business. I’ve had people be like, “Dude, I made three times as much money this year because of one video from your KopywritingKourse.” I was like, “Well, that’s a damn good $69 well spent.”

And then the other thing is the Kopywriting Checklist, copywriting with “K” and then Checklist, you can buy that at AppSumo, that’s ten bucks, super damn cheap! Ten or fifteen, I forget. Ten I think. And… And if you don’t want to learn copywriting but you just need to write something real quick, all you do is follow the seven steps in that, it’s like ten pages long. It’s super…It’s super short. You follow the steps and you’ll pretty much have a scientifically proven like sales letter or email, or whatever you’re trying to write. It’s… That’s the easiest way to write copy.

Steve: Okay, nice. I’ll definitely link all those things up in the show notes. And I’m just curious too myself, what’s in this mysterious NevBox that you sell on your site?

Neville: Like you can’t see me right now but behind me I have 200 extra boxes I’m making. So the NevBox was this product I made, it was inspired by the Gary Halbert Letters. I would sit in bed till six in the morning reading these things because I was so fascinated. And it’s like there’s something about turning the page on these letters and like marking them up with notes and writing it out, that like… I was just like I get so much more value out of sitting down and reading something than just simply reading it on an email or my phone while taking a dump in the morning. You know? I’m not… [Inaudible]… only scrolling and going through it.

And so I was like I want to send out a physical box or a letter. And so it’s a box carefully packaged and it’s… over the course of three days, you open different envelopes. And there’s also some random objects in it that tie into a story.

So I can’t tell you everything of what’s in it but I can tell you this: people loved them. It was… It was one of the easiest sales I’ve ever had to do. And they sold out really quick. And so I’m making more because people keep trying to buy them.

The… Some… One of… There’s one person sent me money for a NevBox. I was like, “I don’t have any for sale.” And they’re like, “I want to preorder it.” And I was just like, “I don’t know when I’m going to have more of these.” “I don’t care, I want the first one.”

Steve: Wow, ok that’s amazing.

Neville: That’s product validation I ever heard one, right. People are like, “You don’t have any? I’m still sending you money for it.”

Steve: So these are just people that read your blog, right?

Neville: Yeah, like…

Steve: Okay.

Neville: …I didn’t promote it anywhere else. They were just people that read my blog.

Steve: So, let me ask you this. So do you have… let… let’s say… You know I get a lot of people on my blog asking how they can make extra money online. So if you were to… If one of these people were to ask you today, what sort of advice would you give them if they wanted to sell something of their own and make some money online?

Neville: Well I… I really strongly believe like the biggest reason a lot of these people fail is they… they ignore this part cardinal rule. And I say it’s cardinal rule, you don’t have to ignore it, if you’re really good, you can get away with this.

But it’s like build a community before you sell a product, right. It’s like… It’s like you make… For example you started your blog and I don’t think you started with a product, right? Like that was a way…

Steve: No. Yeah, I didn’t have a product.

Neville: We’re just putting good stuff out to the world to track your own stuff, to help other people. Like you wanted to build the network and then you started like talking in like Mr. Money Moustache and this person. And then you go all kind of became friends and it was more like a passion hobby of yours.

And then, once you had people following you, you had this inbuilt audience that you can sell something to, right?

Steve: Hmm-hmm.

Neville: If I just started out of the blue, like how to start a news business or something like that, it would have been a much tougher sell. I would have had to like go on people’s podcasts and advertise. I would have to like buy advertising, go on Facebook, start a fan page, do all those sort of stuff that a lot of people don’t understand how to do correctly before I could have sold something.

And so, I like to tell people that just at least start a blog and start participating in that community. However the easiest way is take whatever skills you know and start selling them right away. People are like “Oh, that’s not scalable.” Who cares? Like start out… You have to start somewhere.

And so what I would do, like for example if I had just started becoming like a internet person, want to make a couple of extra bucks online, I would post on Craigslist in my local area that I know how to do Photoshop, I know how to do WordPress, I know how to do this, I know how to use WishList and install it on a WordPress site, I can make your webpage. I would start doing all those things first to start building some momentum, to start making money right away at least, you know.

Steve: Okay. Okay and let’s assume if you… if you didn’t have a blog and you didn’t have a built-in audience like you do today, that’s what you would have started with your copywriting and that sort of thing?

Neville: So the copywriting stuff like obviously I have some experience in it now and so there’s momentum. So I’m just like, oh I’m going to put my shingle out as a copywriter and see what happens. It’s like well no one knows you, you know, right way. You got to do something… So let me… Can I just tell you a story about someone who’s just done it really recently?

Steve: Absolutely.

Neville: I… I got started, so a lot of people would be like, “Oh, but you know you started like whatever, I don’t have that.” There’s a dude named Bryan Harris and he has that site called Videofruit.com, okay. He just made the site like recently, it’s not… it’s not an old site or anything.

He worked the job and then just came to our AppSumo like you know “How you make your first thousand dollars course”. And it turns out he’s really good at video and so what he did was he made this site called Videofruit and there you could buy… buy videos from him. No one bought it of course because no one knew who the hell he was or what he does.

So what he did was, he’s like… He emailed me and said, “Neville, can I make you a free like connected video? Check this out.” And he showed me another one that he made for someone else. I was like, “Dude this is awesome, it was like professional great stuff. It’s like… It’s like their audio background but then the text lies in and it looks super professional, there would be like Dolby after effects or something, what it was like they make movies in.

And so he took a film clip from one of my videos, an audio clip and then put the text over it and I put that on my blog page and then I wrote a blog post about that guy. I was just like, “Dude, this guy’s awesome. Check out what he did. Videofruit.com, Bryan Harris.”

And he got some clicks from there. And from that, he got like three people being like, “Hey, how much do you charge for videos, I want to buy one of your videos.” So instantly, he’s making money because he did free work for someone who has a list and a following already, okay?

He’s not doing free work for the guy down the street who has nothing. And then he contacted like Ramit Sethi, he contacted Noah Kagan. Noah Kagan wrote about Brian. And then Brian would post all this like “Helpful stuff” within the Entrepreneur Facebook group. And all those entrepreneurs would be like, “Holy crap, you make good videos. I’m trying to build a website, can I buy your services?”

All of a sudden, this guy’s pulling in six grand in billing in one month. And then he started a blog about how to do video stuff. And then he realized people don’t just want video, they want marketing stuff. So then he would be like how… he would… he did sneaky stuff like… he’d feel like “How Neville Medhora’s book is smart and dumb at the same time”. He wrote some posts like that.

And he took the end of my eBook and showed how I put my other services at the end. And then he took the end of Ramit Sethi’s eBook and showed how he didn’t do it and he’s like: Here’s how Ramit could have improved it. Here’s how Neville could have improved it. Here’s how Gary Vaynerchuk could have improved your stuff.

So he just started putting out good content and sure enough people started slowing signing up to him. Like you know 2-3 people a day. Before you know it, the guy has a thousand followers. Now whenever he’d release a product, he’ll get 30 sales on a pretty expensive product.

And he did all that in a very short amount of time. But he hustled to play there and built a community first before just saying, “Hey buy this stuff” you know.

Steve: Yeah, you know that’s an important point. A lot of the people on my blog, actually they come to me looking for that magic bullet. But really a lot of time, it just comes out in a hustle and leg work.

Neville: Yeah. Well you know, yeah AppSumo… And AppSumo has like 700 or 1 000 people or so signed up. So like I told you before, like I just sold like a little copywriting checklist I made and I sold like 2 000 copies in very few short days. And that was with the power of AppSumo.

So a lot of people come to us every day saying like, “Can you just sell our stuff”. And we’re like, “You haven’t even sold it yourself, like we don’t even know if people like it. So we’re not going to sell it on a big audience when you haven’t even done it small time.”

So the suggestion is: Start small time, start building your audience.

And you know some people, they just don’t have what it takes, like I’m sure you’ve seen some blogs out there that you’re just like, “Man, this is just not interesting stuff” you know. Like this…

Steve: Yeah.

Neville: … is not interesting. So those people should need to try it to see if they’ve got what it takes like this Bryan Harris kid, he totally had what it takes. I’ve seen other people, they get very sh… advice that’s been out there a million times, just like whatever. They have nothing unique to offer. And so it’s just like they don’t build a following, so no one’s going to buy their product either, you know.

Steve: Yeah.

Neville: So I mean build a community. If you can’t build a community, you can’t build you know a product and sell it successfully. You could but you have to be good and most of those people just starting off are not good.

Steve: That is great advice. So hey Nev, you know we’ve… we’ve been talking for quite a while now and so I don’t want to take up too much of your time. Can you just give… give our listeners you know an email or something where they can reach you in case they have questions? And where can they find you online?

Neville: Yeah. Online, you can google me, “Neville Medhora” or just go to nevblog.com. Also KopywritingKourse.com with “K’s” is the place you can sign up, even if you sign up at nevblog, it’s the same list. And then nevmed@gmail.com. So NEVMED. @gmail.com if you want to contact me and then I’m @NevMed on Twitter.

Steve: Okay. And before we go, you know, are there any online services that you kind of recommend to do some of this experimentation that you’ve been talking about?

Neville: Which experimentation?

Steve: You know where you just throw up a page, a landing page and you just get some leads to see if your stuff is going to sell.

Neville: Yeah, there is a couple. I try to make them myself, like I suck at web design but I power my way through it. I use FrontPage 2003 which doesn’t even exist. Like people tell… hear about that, they’re like, “Does that exist?” I’m like, “No, it does not.”

Or I use like Google Drive or just like Google Docs and then I design something and just like save it as html. That’s how ghetto I am.

So I think you could use leadpages.net…

Steve: Okay.

Neville: Launchrock.com I believe is one of them. And there’s a couple other pages. If you just type in like “free landing page” on Google, you’ll find a couple of those services.

Steve: Okay, it sounds good. Hey well, thanks a lot for your time, Neville. And it was really great talking to you as usual.

Neville: Dude, you too. Good connecting again.

Steve: Yeah. All right man, thanks.

Neville: Yeah man.

Steve: Every time I talk to Neville, this guy really cracks me up. What I really like about him is that he always speaks his mind and he does not BS at all. He’s also a doer rather than a talker if you couldn’t tell from that episode.

Be sure to check out the show notes for this episode where you’ll find the sites and links mentioned by Neville. And also if you have a minute, it would really help if you could subscribe and leave a review for this podcast on iTunes.

Also don’t forget to enter my free contest where I’m giving away a lifetime membership for my Profitable Online Store course. And I’m also offering free consulting as well.

For more information, go to https://mywifequitherjob.com/podcast-launch

Once again that’s https://mywifequitherjob.com/podcast-launch

Thanks for listening.

Thanks for listening to the MyWifeQuitHerJob podcast where we are giving the courage people need to start their own online business! For more information visit Steve’s blog at www.mywifequitherjob.com

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If you are really considering starting your own online business, then you have to check out my free mini course on How To Create A Niche Online Store In 5 Easy Steps.

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002: Andrew Youderian On How To Make 7 Figures With A Dropshipped Online Store

Andrew Youderian

In this episode, I’m really excited to have Andrew Youderian on the show. For all of you who aren’t familiar with Andrew, he runs the popular site EcommerceFuel.com where he writes about his experiences running his dropshipped online store RightChannelRadios.com

Andrew is a great guy and today he takes us back in time to when he first started his dropshipped online store selling CB radios online. Learn how he got started and how he grew his store to over 7 figures in sales.

What You Will Learn

  • How Andrew got started with his dropshipped CB radio store.
  • Why passion for your product doesn’t matter
  • What Andrew looks for in a great niche
  • Why Andrew chose dropshipping as opposed to carrying inventory
  • How much Andrew invested in his business starting out
  • Learn the pros and cons of dropshipping
  • How Andrew’s link building strategy has changed over the years
  • How Andrew got sales for his store early on
  • How Amazon is changing ecommerce and what Andrew is doing about it
  • When to sell on Amazon and when to avoid them
  • Andrew’s advice for new entrepreneurs

Mentioned In The Podcast

Online Services Andrew Recommends

Favorite Books

Transcript

Steve: You are listening to the mywifequitherjob podcast episode number two, but before we begin, I just wanted to give a quick thank you shout out to my buddy Jeff Rose who blogs at Goodfinancialcents.com and Dollarsandroses.com. Now Jeff was actually one of the people who inspired me to start this podcast, and for that I am very thankful. Now on to the show

Welcome to the mywifequitherjob podcast. We will teach you how to create a business that suites your lifestyle, so you can spend more time with your family and focus on doing the things that you love. Here is your host, Steve Chou!

Welcome to the mywifequitherjob podcast. Today I am honored to have Andrew Youderian with me on the podcast. Now Andrew is actually someone who I came across randomly one day on the internet and at the time he had just started his blog EcomerceFuel.com and I was just so impressed with his content that I actually decided to reach out and say hi to him directly. And I’m so glad that I did because since then he has become a well known figure in the world of small business ecommerce. He runs two drop shipped online stores at RightChannelRadios.com and TrollingMotors.net. Actually he just sold one of those recently and it was actually very interesting how he did that. You should go on his blog and check that out, but he also runs an ecommerce forum that is heavily populated with successful ecommerce entrepreneurs as well. Andrew is a great guy, extremely intelligent and I’m happy to call him a friend. Welcome to the show Andrew, how are you doing today?

Andrew: I’m good Steve, thanks for the kind intro; it’s looking forward to talking.

Steve: Yeah, so you know for all those who aren’t familiar with all the different sites that you run, can you give us a quick background story and tell us mainly I guess focusing on your baby which is RightChannelRadios.com.

Andrew: Sure, so just in terms of what I do, or do you want the back story as well?

Steve: Yeah, let’s start with the back story and then you know transition to you know what you’ve done and what you actually sell on that site.

Andrew: Sure, so I guess my story is I got a, I got out of college went to do a job in finance for a couple of years and learned a lot, met some great people but it was just– you know it was not what I envisioned myself doing for the next 10 or 20 years especially given the work life balance that was there or not there rather I guess. So I just ended up saving up much of my money and doing my best to and quit so I had a little bit of time to explore my options and well do the much different things and finally settled on ecommerce as a business model that you know could scale really well, was location independent, that is at least in terms of how I got started with drop shipping, didn’t require tremendous amounts of capital and just carried this research and stumbled up across the radio niche, the CB radio niche as something potentially that might work out.

And so I spent, I guess that was in 2008 I spent the next two or three years really just building up that site, bootstrapping that site, and after a year was, you know helped me make right about a full time income and I guess two or three years then started TrollingMotors.net with the same kind of idea, drop shipping site wanted to just get a little more experience to versify my income and a couple of years after that I started EcommerceFuel which you mentioned, which I do a lot of the stuff that you do Steve. When I was getting ready to start, you know you were one of the few people that was really producing really interesting, compelling ecommerce content and I wanted to do something along the same lines and so that’s kind of where I am now right on the RightChannelRadios, sold trollingMotors.net recently and then also like you mentioned just have the EcommerceFuel forum for existing store owners and ecommerce professionals.

Steve: Okay, great. Yes thanks for the kind words by the way. I was just curious so if you know, if you can take us back to when you first started thinking about selling CB radios, how did you kind of come up with the idea, how did you research that niche and decide that you want to go in to it.

Andrew: You know it’s really tough because that was 2008 and so here we are in 2014 and I’ve learned it’s harder for the last six years as you do is you know diving and getting your hands dirty and sometimes you wonder how much you project back on to your past self and how much is actually you know you thought about in a moment. But the high level process I took was really for me building a profitable business was most important and I didn’t necessarily need to be selling something that I was deeply passionate about. I liked the business process and so I really took a top down analysis type of approach and just looked for– some of the things I was looking for, I was looking for a decent amount of keyword traffic enough to be able to support a business but not so enormous that there was going to be a lot of huge stores really specializing in that niche. That was one thing I looked for; I looked for an area where I could add value.

Steve: Okay

Andrew: So some kind of product where there was really a lot of confusion, a lot of potential pre-purchase anxiety about, wow shoot if I’m going to buy this, this is going to work with my application. The radios I sell go in to a whole you know myriad of a different number of vehicles and there is different installation options and so there is room to add a lot of value there, look to something where very decent suppliers I could work with and so I looked at just a number of criteria, looked for something that wasn’t available locally. There is just you know probably a checklist of maybe 10 different things that I had and then I just went out and start brainstorming everything, you know every idea under the sun.

I probably had all a list of 50 or 60 totally reign on my ideas, everything you can imagine, a lot of ridiculous stuff were there too and then I just started going through and after I had that initial kind of free form brainstorming session, just went through and started evaluating those ideas that are high level against my criteria and when I got down to two or three or four I really did a deep dive in terms of looking at competitors, looking at you know trying to get an idea of margins, you know trying to get a sense for the market place and then ultimately ended you know picking CB radios to move forward with.

Steve: So was CB radios something that you actually knew a whole lot about because you mentioned you wanted to pick a niche where you could add a lot of value to?

Andrew: I knew nothing, I had never used one.

Steve: Wow! That’s amazing.

Andrew: And I think for the first year that I was in business, I don’t even think I saw a CB, no I wasn’t sure, I ordered one to install on my vehicle so I could get a sense for how to install and get some kind of tactile and a physical and personal sense for the product, but 95% of the products I saw that first year I had never even seen in person.

Steve: Wow, okay so you really took a business approach in deciding what you wanted to sell so, is that something that you recommend in general versus going after something that you are passionate about?

Andrew: Yeah, it’s a really good question and I think it depends on you as a person at least the entrepreneur in question. Whether or not, you know how you build if you love business for the sake of business and you love hassle for the sake of hassle, I think you can go out and sell just about anything, it doesn’t matter if it is something you are interested in. But if you don’t really necessarily having a need, desire and love of business in and out of itself, I think that’s going to be a lot harder. It’s a lot harder to sell something that you have no interest in and I think at that point, if you do want to build a successful business, you do need to be selling and offering something that you are passionate about because you are going to have that passion come from one of those two places and if it doesn’t come from one of those two either love of business or love of the product, you are going to be in trouble. And so that’s kind of, I think that’s kind of an internal discussion that people have to have with themselves and be really honest about.

Steve: Yeah I agree because coming from our story so handkerchiefs and I’m certainly not into handkerchiefs but I am very into the business and running the day to– you know running and planning the marketing strategy and that sort of things so I can kind of see where you are coming from. Let’s talk about the business model a little bit, why did you choose drop shipping as opposed to a traditional role which is carrying inventory and that sort of thing?

Andrew: Yeah, it’s a good question. I think like most people with drop shipping I was attracted to the convenience of it. You know of course when you drop ship you don’t have physical inventory. You are working with other suppliers and they take care of all the ordering of the stocking, of the shipping, all the fulfillment inventory side is outsourced and it’s you know it was really attractive to me and it’s also low risk when you are starting and it can be a great… we can’t do it for all markets but in some markets it’s a great way to test the viability of the market without having to go out and order a bunch of stuff.

So for me it was really the location independence at the end. You know I’m really glad that especially for the first couple of years, I am really glad I did go the drop shipping round. I think as you’re starting, it can be a great way to learn especially without having to risk internal capital. I was able to leverage the location independence of it, I was able to do some cost off without being tied down to a warehouse in terms of being able to do a little bit of travel during that time and have flexibility, but I think that I have said this before in my podcast, you starting from scratch now with my experience and if somebody has a little bit more savvy in the ecommerce world and maybe some money to invest, your long term returns as you know Steve you know in terms of making your own products or stocking your own products are going to be significantly higher if you know as opposed to drop shipping. So it’s a mixed bag, I’m glad I did it but definitely you know drop shipping is not like this you know necessarily the land of magic in unicorns and easy profits, so I think a lot of people may be you know [laughter].

Steve: Nothing, nothing ever is, so I was just curious though how much did you ever invest starting your drop ship store?

Andrew: I think all in 1500 bucks.

Steve: Okay, that’s really inexpensive.

Andrew: Yeah, it wasn’t much and it was all bootstrapped from there, I think by the end I mean I always say I rolled profits from that company back in but the only capital infusion I think was 1500.

Steve: Okay, yeah that’s nothing, I mean for us I think we invested 630 but I also did all the website development myself. I imagine you got, you got help in that department?

Andrew: No, I did it myself.

Steve: Oh you did it yourself also?

Andrew: Which is very evident by how the website looked but…?

Steve: It looks great I don’t know what you are talking about.

Andrew: Oh thank you, thank you, this is version two or three or four by now. First version looked aha, looked like the web 1990s web just mobbed in on a webpage in 2008.

Steve: So I thought you could comment on this, one trend at least since I learn a class and I have students who are interested in drop shipping. One of the trends that I’ve been noticing actually is a lot of these vendors want you to actually have a breaking model store in order for them to be willing to drop ship for you as well, so can you comment on how to get around that if you’ve ever encountered something like that?

Andrew: Yeah, I know that happens a lot and it’s tough. I know I was telling Billy Murphy of course he’s a fun of both of us and he– I think he got around that one time by partnering with a local shop who were selling the same goods and I think he pretty much went to them and said hey, here’s my situation. I want to sell this product and the only way I can do it is open up a breaking model store, so I can either (a) open up a store in town and compete with you here or we can partner up and you can be my I guess just my partner on paper if for nothing else so that I can think this agreeing with the manufacturer to be able to bill us all the pack. And so I think that’s what he did and it worked out for him which was great, so that’s one way you can also of course I think a lot of people sometimes will buy just a little small office space so I suppose even like a storage container and– what are they called, is that what they call a storage?

Steve: Yeah, yeah, it’s self storage place, yeah.

Andrew: Yeah, thank you self storage, but it’s tough you know it’s you unfortunately you either get billed something or be a little sneaky in how you do it and it’s not always necessarily guaranteed to work. So it’s tough, it’s not always something you get around.

Steve: Okay, so you know you’ve done drop shipping and you do carry a little bit of your own inventory, is that right today or?

Andrew: Yeah, a little bit not a ton but I mean may be there’s may be three or four items we carry that our suppliers don’t have and we said that we have a good working relationship with our suppliers where we buy it from the manufacturer. We ship it to our drop shipping suppliers and they try and keep an encoder for us and act as our fulfillment house and will throw it in for orders says let’s see what has come in.

Steve: Oh okay that’s pretty clever. So do you have multiple, do you just work with one or two vendors or do you have a whole bunch that you work with?

Andrew: We definitely have more than one. Yeah it’s, I think any time you sup your business procedure especially if you’re drop shipping and you rely on one source for that, it’s a pretty dangerous place to be both in terms of availability and in terms of pricing too.

Steve: Okay, I’m just curious how you have things set up also. So if someone places an order on your site, does that order just go straight to the vendor and do you have tracking information about the inventory and that sort of thing?

Andrew: We don’t. This is something where it’s almost embarrassing to talk about and– but we are really old school in the way we do things, it’s I’ve been wanting to write a post about how a lot of stuff in business just you think like you look at the service and it looks all smooth and operating flawlessly and you think people have everything together and you actually dive into the systems and a lot of times stuff is just duck tapped together and really getting old.

Steve: Oh yeah, I mean we have a lot of get old stuff too so I mean we can have confessions if you want.

Andrew: Always good at that, you make me feel better all seriously and so one thing that is on my list to do this year is to set up a little more real time inventory tracking in order running and we had that with our Trolling Motor site before we sold it but for Right Channel we just you know we have a staff member who as orders come in she goes, she will route them based on product availability and then also based on location so we have multiple suppliers and usually we try to wrap that to the supplier that’s closest to the customer to save on shipping and also to save on I guess to expedite the delivery to that person. So right now we don’t have a whole lot of over, a lot of it is done manually but we’re looking at bringing something in like Ordoro or you drop ship from Agenta of this year to automate all of that because it is pretty embarrassing that we are still doing all of that manually.

Steve: Yeah, I don’t think it is all that embarrassing and you know I think a big mistake that a lot of people do is they spend a whole lot of money on this stuff upfront when they don’t have any business so it’s just a gradual transition right. Once it gets to a point where you need to automate, you just go ahead and automate it. At least that’s my opinion.

Andrew: Yeah, I know it’s a good point, I think that’s sad, if I had to be in one of those two categories it will be definitely the latter you know doing it manually for a while because it’s true I think there is a temptation to create a perfect system for something that doesn’t yet exist.

Steve: Yeah, definitely so you know you’ve done a little bit of both so you are in a pretty unique position to kind of understand the challenges associated with drop shipping and carrying inventory so what are some of the challenges that you faced with drop shipping?

Andrew: With drop shipping it’s, man you know I even never thought about the challenges. I think margins are probably the biggest one. You’ve got you know, it’s got a very big the margins for drop shipping anywhere from 10 to 30% which 30% is on the high side for drop shipping for example our TrollingMotor site the margins were about 11, 12%. A little bit easier in that market was lower margins because we had a very high per order price, which had offset it data back but still pretty low. And so one thing, the hardest thing is I think it’s difficult to scale with pay traffic, if you are going run a drop shipping site, it’s hard to make that work, it’s hard to pay for customers and advertise to grow your business. Just because I think AdWords, a lot of AdWords have made 20, 25% is about the margin areas where a lot of times just divided by niche but roughly where you really make sense to start paying for customers and unless you have a really high lifetime value right unless you want to lose some money on that first sale to when you make it up over repeat purchases in the life of the customer.

So you’ve really got to be good at hassling, at organic marketing, at SEO, at building traffic and attention in other ways and that takes a while to do. Another issue is this, that any time you put an intermediary between you and your customer, it’s going to cause problems you know we have one of the– I think one of the things I think is most frustrating in life in general is having to own up and accept responsibility for someone else’s mistake and we have to do that on a weekly basis or other times when a customer gets something that’s an item was missing or it got shipped to route Canada versus you know Texas, and it’s tough because you can’t say hey I’m sorry I was a drop shipper, it’s not our fault, it’s highly unprofessional right.

Steve: Yeah, absolutely

Andrew: You know and so you just have to own up to it, you got to make it right and you know that’s another thing that is tough and then also the shipping experience I mean you can– you got someone else who’s managing your shipping and so you can’t necessarily control standards quite like you’d like to. You don’t have– we don’t always work with our own shipping accounts so if an item goes out and we need to return it and need to issue an intercept, we need to issue like a call tag to bring something back, we really don’t have our own UPS account, we have to go through our supplier, and then our supplier has to take care of things and communicate back to us and then we have to wait for them and then we talk to the customer, so there is a leg time on everything. So those are some of the frustrations in terms of drop shipping that we say that we’ve run into.

Steve: So that kind of implies that your partner or your vendor is a very integral part of your business and it is essential that you guys have a really good relationship.

Andrew: Absolutely, yeah absolutely and it’s tough you know because we’ve– it’s, it can be a fine line because you want to maintain a good working relationship, a good rapport but sometimes and we do, we have a great relationship with our suppliers, but you also have to be a little hop on the phone occasionally and buzz some chops when stuff is slipping and you know that it’s, you’ve got to be able to do that in a way, you’ve got to know when to do that in a way to make sure things are continuing to be taken care of properly and in a high quality manner and you also have to know when to give a little grace and a little bit of understanding when– this is tough, I mean any business is going to have mistakes I’m so sure.

You’ve to got know where that threshold is. It is kind of like management right, you know you want to be, if you have people under you and you are a leader you want to be hold people accountable, but you don’t want to be just a hammer head. You want to be someone whom they look up to and can come to with questions but you don’t want to be a pushover too. So it is a fine line to walk.

Steve: Yes, almost like having your own employees in a way except that you have no direct control over.

Andrew: Yeah, it’s a little vague, that’s a good way to look at it.

Steve: So if you are– so when you get returns, do they come back to you or do they go back to the manufacturer?

Andrew: Well, it’s funny you asked that, they usually will go back to the manufacturer but sometimes they will come back to us based on because I think US PS makes it harder to put all return, put the suppliers return address on the packages as opposed to warehouse and so if they get returned or come back to actually my office or sometimes people will just you know I guess there is this, it is kind of confusing because sometimes the UPS label will get scanned even though even it says our supplier on the return address, the address on the label will say our office and so I’ve got you know right now I’ve probably got three to four radios and six antennas in my office that they just happened to come back to me, so most of them go back to the supplier but I definitely get some straylers coming back to me.

Steve: It’s just a shared story, we got returned merchandise in our office too that’s been unprocessed, so you’re not alone there Andrew.

Andrew: That’s good to hear and it’s tough because it’s– sometimes you look at stuff and you just get caught up and usually we are pretty good about getting you know following up on people and figuring out what happened but you know sometimes ashes occasionally fall to the cracks and then there is some, I mean there are some right now in my office and I’m like oh man I’ve got it I have to figure where this came from [laughter].

Steve: Yeah, so you know in the earlier point that you just made about not having the margins for paper clip traffic so how do you get the customers on to your site if you are not paying for it?

Andrew: Yeah, a good question you know back in when I was building a bright channel it was just a lot of it was good old fashion networking in the niche, a lot of guest posting, a lot of really pitching people on quality articles and biased cards that we would put together for their audience, and so we would go out to– we would try to identify okay who are our customers? They were vehicle owners. Where do those vehicle owners hang out? There was a lot of communities for different vehicles of all different vehicles of course online, and then we would try to go identify the owners of those communities and try to build a relationship with them first and then try to network with them and then offer them something of value to their visitors and really picture as not hey can we guest post on your site but more of hey we notice that there is this gap in the articles you offer. The researches that you offer to your visitors, not sure if it would be interesting but if you would like kind of a comprehensive bio skid on taking radio equipment for let’s say covet for example, we’d love to write it for you.

And sometimes that will work and sometimes it won’t but that’s how we were able to get a lot of early slip back links out of the traffic and the relationships and I think really it’s about building relationships if you can pull genuine relationships with people in your niche and with people that serve you and customers. Eventually that’s going to lead to something as long as you have something genuine with value to offer that’s going to lead to that exchange. I think it’s when people read right out of the gates with emails that are just hard sells right up front that people get turned off and so that was the approach we took for marketing RightChannelRadios in to a last exceptionally models.

Steve: So you were guest posting on just related blogs or– and making partnerships with people on your same niche and then that just gradually build up your search engine traffic?

Andrew: Yes

Steve: Okay

Andrew: Exactly and blogs– probably blogs somewhat but then also probably even more communities and forums and a lot of like forums out there for hobbyists and enthusiasts who have a forum section and a lot of times they have regular articles and a research section and we love those.

Steve: Okay, okay so I’ll just you know since we’re on the topic of SEO, Google’s making a lot of changes these past couple of years and I just wondering if your strategy has changed at all as a result of that.

Andrew: Yeah, it’s a good, it’s a great question and it hasn’t. To be honest, I haven’t, I haven’t. It’s been you know probably three or four years since I launched a brand new ecommerce store, but at least with ecommerce if you are kind of a content community site, and that’s been about you know real lesson two years I’ve been running that and for that the approach has differed significantly I mean take the old SEO we used to do for RightChannelRadios, we would focus a lot on anchor text. We would focus a lot on really key word research still is important but we were really aiming on that you know making sure the exact phrase was perfect for what the search volume was and guest posting would probably focus more on quantity versus quality.

Fast forward to what the strategies I’ve been trying to use with EcommerceFuel and it’s been much more focused on getting a lower number of high quality links. It’s been much more focused on trying to write along or create a lot of quality in-depth long forum content and build a reputation, drive people to really engage with that content and choose their comments and shares. It’s been about building relationships with a lot of high profile key players in the space and really it’s been– it hasn’t been focused as much on anchor texts or exact key words. I’ll still look for you know when I’m running a blog post for example on EcommerceFuel, I’ll still a lot of times try to come up with a key word that I think is a key word or a key word phrase that I know people are searching for, but once I have that like for example I’m going to get write a publisher post on bootstrapping and so I did a quick search in Google autosuggest for bootstrapping in business and came up with I think bootstrapping my business was the phrase people searched for.

And so although I had to make sure that SEO url for my blog post, I’ll make sure I get that phrase at least once into the copy. I may or may not include that phrase in the title exactly based on how compelling it fits in with a really strong title and that’s it. I’m not going getting out and try to build links with it back without anchor text, I’m not going to make sure it occurs five times in the copy because Google is getting I think much better at deciphering intent and really being able to distinguish high quality stuff versus lower quality stuff and for me it’s been more about building a highly authoritative site and letting the site authority and the domain authority really help propel the rankings for individual articles as opposed to trying to game the system.

Steve: Great, it’s all right. And that’s on your blog that you were talking about right, do you still do posts for RightChannelRadios or…?

Andrew: We you know we– it’s been– we haven’t done a marketing piece for RightChannel in a while and I don’t know about you Steve but I tend to be very like silo focused like I will spend six months focusing on like promotion for EcommerceFuel and then I’ll spend six months on or three months focused on like selling one of my businesses then I’ll spend four months focused on really gearing up and improving the processes for like RightChannel and so it’s been a little while since we’ve done a marketing piece for RightChannel and so a lot of the growth we’ve seen there has been more based on word of mouth and organic referrals I think for the business, so it’s, we– to be honest with you we haven’t done a lot of guest posting.

Steve: Yeah, you know I’m the same way with you. I can’t really focus on multiple things at once, so I tend to just do one thing and when that’s done I move on to the next so…

Andrew: Yeah exactly, I feel I get so much more efficient than trying to juggle four big projects at once.

Steve: Absolutely, yes so it sounds like a lot of your traffic to your store is SEO and at least with my store SEO traffic didn’t kick in until much later in the first year so how did you get sales early on and how did you prevent yourself from getting discouraged at the beginning?

Andrew: Yeah, that’s a great question. I’m a big advocate of even if, even if it’s not necessarily profitable early on with the store to run some pay traffic to and so I’d say for the first six months we run page traffic with Google AdWords primarily to RightChannel, just for those two reasons. One to not get discouraged because man even– there is a lot there’s an emotional aspect to seeing those sales coming even if you know you’re not necessarily making a whole lot of money or any money on them, it gives you motivational factor but even more importantly it helps you start engaging with customers, understand who they are, what they want, what kind of problems they are having, what kind of products they need that you don’t offer. It’s always you know, you learn so much engaging directly with customers and so we kind of we would start with that and then as the search engine and traffic picked up and started to really become a lion share, the traffic then we kind of discontinued, or slowly trailed off on with the pay traffic but it was very useful starting you know.

Steve: Yes and what were some of the tools that you used to analyze your customers, was this just from talking with them on the phone or…

Andrew: Yeah I’d say the best tool was getting people on the phone.

Steve: Okay

Andrew: You know it’s funny because I think we probably– we could probably have a whole podcast about this too Steve in terms of whether or not you should have a phone number and we you know right now with RightChannel we do a lot of things to try to really stand out with customers but we don’t necessarily offer like a phone where people can just call up and talk anymore. And it’s okay we can talk about the pros and cons there but for early on it’s so viable. You get someone on the phone, you talk directly with them back and forth and you learn so much about who they are, what they need, where your short comings as a business are. Just being on phone as you know I think it’s the best tool you can use to get market intelligence with your customers.

Steve: Yeah, I think it really depends on the niche because in ours which is the wedding industry you absolutely have to have a phone number because you have all these frantic people calling you up with deadlines [Laughter].

Andrew: It’s really funny, yeah and it’s funny like same thing with the TrollingMotors. With Trolling Motors you know people are looking at buying a $1500 trolling motor. If they can, everyone may not need to call or want to call but if they feel like they can’t call, that’s a big deal you know. I would not want to order a $1500 order trolling motor from some place you didn’t really exposed to a phone number or that I can get a live person on the phone from. So I think it is market specific.

Steve: Yeah, absolutely. So let’s change, let’s switch gears a little bit and you know at least on my mind and this is kind of spurred by one of the topics on your forums on the EcommerceFuel forums and this is just the whole topic of Amazon and how Amazon is kind of commoditizing a lot of the online stores. So what do you see happening and what are you doing with your store to kind of fight against Amazon?

Andrew: Yeah, it’s a great question and it’s Amazon is just eating up retail and it would be nice to build a hit on them but they are you know they do a really good job in terms of customer service, in terms of offering the best combination I think of for a lot of products value and convenience and so you know what I see happening is I really see– I see kind of a hauling out of the middle of the market. If you are a big store that sells a lot of you know– it’s fairly broad based and sells a lot of existing products, existing products from the market, I think it’s like they’re going to have a real hard time in the next couple of years. Places like I don’t know why Tiger director always comes to mind but I feel like they are kind of just a general retailer, reseller or kind of just general electronic parts and I don’t see how they are going to survive in the next two to three or four years.

And so what I see happening is you either have you know you either need to do one of– Amazon’s going to be the place if you are looking for something and price is very important to you. An existing product people are going to go there a lot so and really as independent retailers you either need to offer one of three things. You either need to offer a unique product that you can’t get anywhere else so you control the distribution. An example is the guys over; did you see the kick start campaign for Minaal for Minaal travel bag?

Steve: I did not.

Andrew: Also I have to link, may be you can put in the show notes.

Steve: Okay, yeah.

Andrew: Jimmy and Doug over there, they’re great, great guys and they’ve put together an incredible travel bag that solves a lot of problems that light weight travelers on the road have. I bought one of them and it’s amazing. They’ve got something that’s not sold in the market and it’s a you know they control complete distribution so they can set whatever price they want, they can control that supply chain so they are not getting undercut. That’s one option having your own product. The other option is having very strong branded experience, so if you are going to sell existing products, use something really unique, really you know something where somehow the experience is to hide into the product, that’s another option.

The third one is add value, add informational value to existing products and that’s what I try to do over RightChannelRadios is really add a lot of value upfront. Amazon can’t in terms of what goes with what, really specializing in a very niche field and adding value in a way that– one thing we are doing you know you asked what we are trying to do to differentiate ourselves. One thing we are doing this year is really going in and creating in-depth installation guides for specific vehicles. So let’s say you’ve got a Chevy 2010 half tank pickup truck. Not only can you come to our site hopefully in six months and or in three months you are going to be able to understand what products are all going to go together but we’re going to have a ten page illustrated installation guide on exactly how to install that product on your specific vehicle. And that’s something where, it’s going to cost a decent amount of money to produce up front but once we do, that’s got ten, twenty, thirty, fifty dollars with a value. I mean it’s hard to say but it definitely has a lot of value to somebody who doesn’t know how to install, is something as once you create it’s like an information product is added to your ecommerce mix. That’s one thing we are going to try to do.

We’re also really looking to personalize our site a lot more. You know just this week we’re actually going to film an ‘about us’ video for myself, for my sales manager. We are going to get in front of the camera, we are going to talk about who we are as people like how we can help our customers, really put a face to the brand because that’s another thing that just is going to differentiate small merchants from big giants like Amazon is being personal. People love to buy from people and I think that’s going to be increasingly important. So anyway sorry Steve I kind of rumbled on there for a while.

Steve: No, no this is all good stuff and I actually had a couple of comments on that so when I shop at Amazon in-house buying something complicated like a radio that I need to mount on my pickup truck for example, the support just isn’t there. Sure they have an excellent return policy but once I purchase the product, I can’t exactly go and ask Amazon how to install and that sort of thing so I would probably tend to buy from your site because the support will be there right. I could actually call you or contact you in some way.

Andrew: We’ve got yeah, we do– we have a really comprehensive troubleshooting library of resources in terms of installation and troubleshooting some of the problems that popup in tutorials and things that are going to be very specific because Amazon necessarily won’t be able to obviously have those kind of resources.

Steve: Right, so here’s the question, do you actually recommend people who have their own products for example do you recommend they actually post their items on Amazon?

Andrew: Yeah, good question. I think it depends on, I think it depends on if the product is– if it’s your product and you’ve created it, and it’s branded to you I think Amazon is a very powerful platform because you are going to reap into all their traffic and all their reputation and trust and authority. I think if you are reselling existing products, I think it’s tough. I mean I know in our niche we’ve got people who are starting to go on Amazon and resell on products and we have intentionally stayed out of that market because even assuming we could get in and assuming we could make a little bit of profit out of the gates, it just becomes a price war.

Steve: Yeah, absolutely.

Andrew: Because, I mean there have been people on the forums in ecclesial forums who’ve been signing upfront for a while and they just talk about how people do get on there, and they’ll see people selling below cost and they don’t understand if it’s because they are just trying to gain market share or improve their seller reputation and their rank on Amazon by increasing their volume or if they are just clueless and they don’t understand that they are losing money. But I think it’s– I don’t think it’s a good long term strategy for building a profitable income stream. I think there might be a few couple anomalies where may be a bit trashed up opportunities where you can get in and may be for a couple of months here and there, may be even a year you can get in and make it work, but I think selling existing products on Amazon is going to be tough.

Steve: And so, let’s say you were to decide to sell on Amazon, would you go with just selling an Amazon regular or would you actually use their fulfilled buy service, because Amazon prime is very compelling.

Andrew: It is and I think you know I think if you’re using the FPA approach if you’re selling on Amazon makes a lot of sense because like you said you get, it’s going to pop a bit of qualify for and minimum pre-shipping involved you know $25 or $35 for folks. And then also if it’s for prime members, yeah they get to ship from two days for free which is you know I know that I have been trying recently to go less on Amazon especially for unique products I try to support independent merchants more. But there are some things that just are commodities that Amazon is, I think it’s a great you know is a good choice for like diapers for example. You know you buy diapers on Amazon and I know that when I’m shopping for commodities on Amazon, I always click at all Amazon prime band.

Steve: Yeah, absolutely same here and in fact whenever I shop on Amazon, I always look for the prime. I actually don’t buy from anyone who doesn’t have the prime display.

Andrew: Yeah, exactly it’s powerful.

Steve: Yeah, yeah it’s very powerful so that actually presents unique challenges you know when you’re trying to decide whether you want to sell on there because they take a huge chunk out of fulfilled buying, I think it’s like almost a third of your revenue is just rocked off right after that.

Andrew: Are you sure, that seems really rich.

Steve: I just heard someone else on the show actually who sells on Amazon using fulfilled buyer for a living and she said yeah she dedicates a third of her revenue to pay Amazon and she gets a third to buy the product, then she gets to keep a third.

Andrew: Wow!

Steve: So

Andrew: Let’s see I– and again I’m sure she has, she is in a position of speaking with much more authority than I am on it because I haven’t used them but I always heard it was roughly 15% for just listing fee through Amazon on in there and I always thought FPA was more of a fee based. If you use FPA, I always thought it was a fee based thing that was just pretty much like you pay a dollar for every pick and then you pay a shipping fee and that’s it.

Steve: Yeah, I’m not sure of the specifics. She tends to sell smaller items but that’s how she kind of budgets her stuff. You know I think just regularly selling at Amazon, I think the fees are in the order of 12 and 13%. I have to check to make sure since I don’t sell on Amazon but I think that’s what the percentages were.

Andrew: Yeah, I think they are various by categories so like both sources like electronics versus other things but I remember looking at electronics and they were like 15% so we are going to try sell trolling motors online like it’s, the margins are very low.

Steve: Exactly

Andrew: Eventually wipes out your entire margin right there.

Steve: Yes so if your RightChannelRadios, if your margins were a little higher, I don’t know what they are but if they were a little higher, would you consider selling on Amazon or would you just stay away?

Andrew: Again we’d stay away. The only thing I would consider selling on Amazon is something which will add some kind of value to because again we’ll just get– even if it’s not today, in the next three, six months more people are going to come in and just drive that price to under zero and you’ve got you know these smart time, you’ve got to invest in, not a crazy email, you’ve got to get in, set it up and engage your listings going. So the only thing I would sell is may be smaller packages that we buddled together and included the very in-depth personal video that walks through the highlight and also included the installation guide more valuably that walks through the process because then you get some kind of differentiator, some kind of value add where you’ve got a reason to be able to charge a different price and it sets it apart so people can’t compare apples to apples but it’s yeah not interested in getting in and slogging it out with 20 people who are willing to have a fraction of a percentage profit margin.

Steve: Yeah, speaking of which I hadn’t considered this strategy with my store since we sell products that are– many of which are pretty unique, we are thinking about just posting stuff on Amazon at higher prices to cover the fees and then you know if someone buys, we can kind of just in the packaging provide a lot of collateral about our store and hopefully the second time though they should come directly to our store and then we can incentivize them with the coupon or something like that.

Andrew: It’s tough, I’ve heard that and again this is me speaking a little bit out of my authority zone but I’ve heard that Amazon has restrictions on how you can brand and what you can include in your product when you are selling on their market place.

Steve: Aaaaa

Andrew: Yeah, if you use Fulfilled By Amazon as your fulfillment center and you don’t sell on Amazon’s marketplace. So let’s say you use a fulfillment center but you sell on your own you know [Inaudible] [00:39:57] but you use FBA to ship it out, I think those restrictions are lifted, but if you have any of your products listed on the Amazon market place where people place the order through Amazon, I think they’ll remove all they know about you including branding and marketing material. I don’t think they let you do it, and I actually think you have to pay. They ship everything else in an Amazon branded box. If you want them to ship out in a box that is not branded with Amazon, just a blank one you have to pay extra for that.

Steve: Aaaaa

Andrew: So they’re very conscious of using the fulfillment services and using I guess using the fulfillment services to brand Amazon as well as not necessarily allowing merchants to use their platform to really siphon people over their own brand. I think that’s tricky.

Steve: They are clever on their part, they are very clever. Well played Amazon, well played.

Andrew: Have you read the, do you read ‘The Everything Store’ by chance?

Steve: I have not.

Andrew: Yeah, you should read it, it’s interesting, it’s a– I would recommend it to anyone listening. It is just kind of a biography of Amazon, of Jeff Bezos. It’s a good read and it’s very telling also.

Steve: So we’re coming up on to 40 minutes. I don’t want to take up too much of your time, so I wanted to just ask you, if you had any advice for people who are listening who want to create an online store, who may be want to double on drop ship or carrying inventory and that sort of thing.

Andrew: Yeah I’d say, I say if you are going to start with drop shipping, try to make sure that you have an ability to grow beyond that into stocking your own product. That’s one of the kind of little regrets I have about CB radios and that niche is even as we’ve grown, just the economics of buying products or bringing them in house really doesn’t make sense. You know so the increase in margin we would get as we bought products wholesale and brought them in-house really doesn’t offset the hassle and cost of warehousing them in the capital LA. And so it’s still a great niche but I wish we could, I wish the market allowed us to grow into that and invest more money to see higher rewards.

So drop shipping again like we talked about it’s got some great advantages but make sure you’ve had a long term plan that will let you grow past that. I mean for me personally the next business I start will likely, ideally I’d like to start building and creating my own products. At a minimum stocking products that are harder to get, but ideally in creating a unique product under our brand, that’s not available other places just for other reasons that we mentioned because it’s so much easier to scale when you’ve got those higher margins. You can use paid advertising, you differentiate it, you can leverage Amazon versus having to wait into the mark and compete with people on tiny profit margins. And so that would be my advice is don’t really think through it, if you’ve got the capital to invest, if you’ve got– if you are willing to take a little bit more of a longer approach to seeing returns. Creating your own products or stocking products at minimum is going to give you all those higher returns in the long run and if you do so with drop shipping make sure you do have one; a plan to really understand how you are going to differentiate yourself. If it’s price, if the only way you are going to be different from other folks is price, don’t get into that market.

You really need a very concrete action plan on how you are going to add value to existing products and then secondly make sure you’ve got, you know talk with your suppliers ahead of time, talk with manufacturers and say hey what’s the margin increase I get if I buy direct from the manufacturer in bulk versus buying from a wholesaler. If it’s only two, or three, or four percent, it’s tough. If it doubles or triples your margin, that’s a much more attractive growth projectory as you are increase your revenues.

Steve: Yeah, then one thing I just want to add to that is speaking of adding value, one thing I notice that in terms of personalized products, Amazon doesn’t really do a really good job of doing that. So if you could add value by personalizing, which is becoming kind of huge these days. That will help a lot with your shop as well. I don’t know if that applies to a lot of things but…

Andrew: No, I think it’s a great point. Yeah if anything people love personalized stuff and yeah you’re right, that sounds something. I don’t think, I’m not sure if I’ve ever seen anything being personalized on Amazon.

Steve: I don’t think they have the interface to do it right it now. I’m sure they have something in the works though but for now at least…

Andrew: Yeah, that’s mean, we’re going knock on them. Give them three months and they’ll have it rolled out.

Steve: So I thought I’d end this interview, you already mentioned one business book that you recommend that we all read which is ‘Sell anything’ or ‘Sell everything’. Is there any other business books that have kind of shaped the way you look at business and running stores?

Andrew: Yeah or do you mean ‘The Everything Store’?

Steve: Yeah, ‘The everything store’ sorry I got the title wrong.

Andrew: Aha it’s ‘Everything Store’. I’d say a couple of books, a couple of books I’ve read recently that I really enjoyed. One was ‘The 7 Habits of Highly Effective People’ and that’s kind of a classic. And I always– I remember you Steve but I’m always a little bit relied in these self help books so like it’s really inspirational kind of feel good. If it’s feel good in titles like that, and I was like really like how much you know how impactful is this going to be, but I read it and I was really impressed. It actually has changed the way I’ve kind of looked at business. It’s made me be more intentional about what I spend my time on, how I structure my day. So that is a book that I would recommend. Again ‘The 7 Habits of Highly Effective People’, great book.

Another book if you are managing people is ‘EntreLeadership’ by Dave Ramsey. He really talks about how you structure your businesses, how you build the team, how you lead with intentionality and with integrity, and in a way that is going to inspire confidence and loyalty with your team members. So that’s going to be something a little bit more for folks who they do have a team, or aspire to have a team in the future, but it’s a great book ‘EntreLeadership’ by Dave Ramsey. So those are two recently that have been impactful for me.

Steve: Okay, I have not read the Dave Ramsey book yet. I’ll have to go and pick it up and check it out. That’s great.

Andrew: What about you, what are you– read any books recently that have had a big impact?

Steve: Yeah, you know I get asked this question all the time and right now I’ve been reading a lot of technical books because I’m just trying to learn all the tech behind websites and become more professional at it so that in fact I can contract out the work a little more effectively, so I can kind of understand what the developers are doing to help me out and that sort of thing. So I like to understand everything before I contract anything out. So that’s just in my personality.

Andrew: I think it’s a great– I mean like we were kind of talking about this offline before we started the interview but I just wrote a post on bootstrapping and I think that’s, I think it’s one of the big mistakes people make is not having understanding about different areas of their business before they go out and hire out because I just– more often than not it just leads to chaos.

Steve: I agree and just like this podcast, so I learnt how to post process all the audio and then maybe I’ll be using your guide to do all the post processing after this, who knows. So I would like to close, you know any other online services that you use for your businesses that you can’t live without?

Andrew: It’s a good question. I use Google docs really for a lot of processes that we set up in our documentation, use Asana for setting up who is responsible for what, not only for kind of project tracking but for managing SOPs and things like that, responsibilities and other services. Those are couple of the big ones that we…

Steve: Okay

Andrew: Apart from hosting and helped us conserve but I think a lot of those people are probably familiar with these.

Steve: Okay, so near to close do you want to tell everyone how they can find you and what all the other sites that you own are?

Andrew: Yeah, that would be great. You can find me depending on where you land over twitter@Yauderian or at EcommerceFuel. Of course eCommerceFuel.com is where I blog about ecommerce and I also have a private community. If you are a store owner and you’ve got established store with at least you know four or five thousand in monthly revenue or an ecommerce professional with at least a year of experience on the space, that’s the forum that we run for those– a vetted forum for those groups of people over there. And I also have a podcast that as well you can learn more about on iTunesall@ecommercefuel.com again the name of podcast is EcommerceFuel. So that’s you know that and the RightchannelRadios.com is the radio business we’ve been talking about and then TrollingMotors.net no longer mine. It’s in good new hands but that’s the business we just sold, so I think that’s kind of what I’ve got going on online.

Steve: Great I just thought I put it in plug for you forums as well. The amount of people, the quality of the people on that forum is very high and I’ve actually personally learned a lot myself.

Andrew: Oh, thanks it’s been good having you in and spend– it’s been fun growing in the community and just– it’s cool having a group like that of people who are in trenches that we can kind of bounce off of each other and you know that everyone there at least not to be exclusive you know to be whole it all we don’t exclude people for the sake of excluding people but I think that you know it’s, there is certain reason for having people there all in the same place in terms of maintaining a count level of conversation that everyone is kind of able to plug in to relatively quickly.

Steve: Yeah, I don’t know about you Andrew but I get lonely, because I don’t know a whole lot of people that run ecommerce stores so it’s a good outlet for me at least.

Andrew: Yeah, I like all this is human Steve, yeah.

Steve: I know, thanks for coming on the show Andrew, I really appreciate your time.

Andrew: Hey, thanks for having me Steve, it’s been good chatting

Steve: Take care

I always love chatting with Andrew Youderian. Now, what I really like about him is that he’s really down to earth, extremely personable and always willing to help. He’s also created an incredible ecommerce community on his forums, so I recommend that you go check them out at www.ecommercefuel.com/ecommerce-forum. So be sure to check out the show notes for this episode where you will find the sites and the links mentioned in this episode. Also if you have a minute it would really help if you could subscribe and leave a review on iTunes for this podcast. Also don’t forget to enter my free podcast giveaway where I’m actually giving away a lifetime membership for my profitable online store course. For more information about this giveaway go to www.mywifequitherjob.com/podcast-launch. Once again that’s mywifequitherjob.com/podcast-launch. Thanks for listening.

Thanks for listening to the mywifequitherjob podcast where we’re giving the courage people need to start their own online business. For more information, visit Steve’s blog at www.mywifequitherjob.com.

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Ready To Get Serious About Starting An Online Business?


If you are really considering starting your own online business, then you have to check out my free mini course on How To Create A Niche Online Store In 5 Easy Steps.

In this 6 day mini course, I reveal the steps that my wife and I took to earn 100 thousand dollars in the span of just a year. Best of all, it's absolutely free!

001: How We Started A 6 Figure Business Selling Hankies So My Wife Could Stay At Home With The Kids

Steve Chou Episode 1

Because this is the very first episode of the My Wife Quit Her Job podcast, I thought that it was only fitting that I would be the first guest.

In this episode, I take you back to the very beginning when my wife and I first started our online store selling wedding handkerchiefs. You’ll learn how we got started, how we stumbled upon our niche and how our business gave birth to a popular blog and an online course on how to start an ecommerce store.

Finally, you’ll learn about my motivations for the podcast and what’s in store for future episodes. Enjoy!

What You Will Learn

  • What this podcast is going to be all about
  • The type of entrepreneurs that I’ll be bringing on the show
  • Our motivations for starting our online store selling wedding handkerchiefs
  • The story behind how Bumblebee Linens was created
  • The story behind MyWifeQuitHerJob.com
  • The story behind the creation of my online store course at ProfitableOnlineStore.com
  • The one thing that gave me the confidence to start my own online business
  • How starting our businesses have improved our lifestyles
  • Why you don’t need to hit a home run with your business
  • Why starting a business doesn’t cost a lot of money and is less risky than you think
  • My philosophy behind why you should start a business on the side while working a full time job

Items Mentioned In This Podcast

Transcript

00:00
You’re listening to the My Wife Quit Her Job podcast episode number one. Now before we begin, I just wanted to announce that I’m doing a big giveaway of my Create a Profitable Online Store course, as well as free consulting for a few lucky winners. To find out more about the contest, please go to www.mywifequitterjob.com slash podcast dash launch. That’s mywifequitterjob.com slash podcast dash launch.

00:30
I also want to give a quick thank you shout out to my buddy Pat Flynn who blogs at SmartPassiveIncome.com. It was actually through Pat’s awesome podcasting tutorials that I was able to get up and running really quickly with my own podcast. Now on to the show.

01:00
Steve too.

01:04
Welcome to the My Wife Quit Her Job podcast. This is episode number one and I’m super excited to be here because this podcast has been a long time in the works. Now I actually planned on starting this podcast sometime in the middle of last year, but know stuff just got in the way. Kids activities got in the way, life got in the way, but I’m glad to have put the excuses behind me and what matters is that I finally pulled the trigger, took action, and here we are today.

01:33
So since this is the first episode, I wanted to first talk about what this podcast is going to be all about. Now first off, if you follow my blog at mywifequithejobs.com, you can probably already guess that the theme of this podcast is going to be about entrepreneurship and specifically focusing on online businesses and e-commerce, which happens to be my bread and butter. But unlike other business podcasts that you might see on iTunes, mine has a little twist.

02:02
So my podcast is going to focus specifically on starting businesses with the goal of improving your lifestyle. So this is not going to be a podcast about starting the next big company like amazon.com, like a Facebook or like a Google. It’s not going to be about creating a business that requires outside funding from a VC or an angel investor and growing a company as fast as possible by working 100 hour weeks. Now,

02:31
Every single entrepreneur that I’ll be bringing on the show started their companies to improve their life in some way. So for example, some of the entrepreneurs that I’ll be bringing on started their businesses because they hated their jobs. Some entrepreneurs started because they wanted to become a stay at home parent. Some entrepreneurs started simply because they wanted to be their own boss and control their own destiny. So in a nutshell, we’re going to be talking about starting businesses that will make you enough money to be happy.

03:01
but not consume your life. After all, the ultimate goal is to make enough money so you can spend your time doing the things that you love and spending more time with your loved ones. The ultimate goal is to live a balanced lifestyle of work and play. So one thing I do want to make clear though is that just because you want to live a balanced life with your business does not necessarily mean that you can’t earn a lot of money. And just as an example,

03:30
Some of the guests that I’ll be bringing on the show earn six, seven, eight, and even nine figures with their online businesses, and they all live very balanced lifestyles. So I thought I would kick off this podcast by giving a brief introduction of myself and my background. My name is Steve, and I run the popular blog MyWifeQuitterJob.com, an online store that sells wedding linens at bumblebeelinens.com.

03:56
and an online course that teaches people how to start their own e-commerce stores at profitableonlinestore.com. Okay, so I thought I’d take you back to the very beginning when I first kind of stumbled upon online businesses and the year was 2007 and I remember that year very clearly because that year my wife and I were stuck in a major rut. And what do I mean by a rut? Every single day was like a routine.

04:25
We would wake up, we would go to work, we would come back from work, have dinner together, watch TV in bed until it time to go to bed, fall asleep, wake up the next morning again, go to work, rinse and repeat. Now, we didn’t have any direction and days just flew by and I never felt like I accomplished anything with my life. I hung out with friends and had a good time from time to time, but my life just seemed kind of aimless.

04:54
To make things even worse was that my wife actually hated her job. And you know, every day after we would eat breakfast and it was time to go to work, she would come to me and with a really long face say, honey, I’m off to the hell hole I call my job now before leaving for work every single morning. Okay, and this actually happened for quite a long time and it was really, really depressing.

05:21
every single day having to see my wife go off to work to a place that she didn’t want to be at. And unfortunately, you know, this persisted for quite a while until something really major happened in our life. And this major thing was that my wife became pregnant with our first child. And as soon as we found out, you know, practically everything changed overnight. For one thing, my wife told me that she wanted to quit her job and become a stay at home mom.

05:51
And on my end, you when I heard about the pregnancy and the fact that she wanted to quit, I was happy and I was terrified at the same time. Now, I full on believe in having a parent stay at home with the child, but I was really worried about the money. And it was primarily because my wife made a six figure salary at the time working for a Fortune 500 company. Okay. And to make things worse where I live, which is in the Silicon Valley,

06:16
you pretty much need two incomes if you want to buy a house in a good school district. And, you know, having two six figure salaries in the household, you know, I become accustomed to living a certain lifestyle and I really didn’t want to drastically cut back. So instead of just having my wife quit and just, you know, forgoing all that income, we decided to try and start an online business together.

06:45
So I actually got the idea to open an e-commerce store for my friend Yuji. And I just remember this moment very clearly because one day just out of the blue, he came up to me and he wanted to show me a project that he was working on. And it turns out that he created his own online photo store in order to sell his photos. Now what the kicker was here was that I was pretty sure that he didn’t really know that much about websites at the time. He didn’t know how to program in PHP, HTML and CSS.

07:15
But yet here he was showing me a fully functional online store that he implemented 100 % by himself. And it turns out that he paid zero dollars for his website because he used open source software to implement everything. And if you could see my face as he was showing me his website, you could have seen that my jaw completely dropped. Because here he was, you know, a person who wasn’t, who didn’t have experience with websites and here he was creating a fully functional website.

07:45
And it was after seeing his website, that’s what actually gave me the confidence that I could start my own online store, even though I had zero knowledge about the web whatsoever. And so I went back and I talked to my wife about this and it turns out that the online business model was pretty ideal for us if we could pull it off. We could have a computer take orders for us 24 seven and all we had to do is pack and ship orders at the end of the day from home. And if you were to fast forward to today,

08:14
You know, don’t even need to carry inventory. You can actually do something called drop shipping. And the way drop shipping works is you simply just take orders on your online store and have a distributor actually ship the orders to the end customer. Okay, and so, you know, with that in mind, you know, we kind of had the confidence to start our own online store and we ended up starting our online store, bumblebeelinens.com in 2007, selling wedding handkerchiefs online.

08:45
And if you were to fast forward a little bit, within a year, we actually managed to make over $100,000 in profit. And by the time my wife’s maternity leave was up, we had made enough money with our store to replace her lost income so she could actually quit without any financial repercussions whatsoever. So if you were to fast forward to the present day, my wife is much happier now. She earns many more times the amount of money than her day job.

09:11
And our business has actually grown in the double and triple digits for the past six years. And the best part is that she only has to work a couple hours each day, she gets to stay at home with the kids and set her own schedule, and overall it turned out to be one gigantic win-win situation for us. Okay, and so that’s just a little background story about how my wife and I started our e-commerce store. One of the most asked questions I get on my blog is actually how we came up with selling wedding handkerchiefs online.

09:41
And naturally there’s a story behind that as well. Now, like most business owners I know, you often have to draw upon some of your own experiences when finding the right niche for your business. So how did we find our niche? When my wife and I first got engaged to be married and we were planning our wedding, my wife knew that she was going to cry. Now she gets very emotional during weddings and special events and she basically didn’t want to be seen at the altar with some ratty tissues to dry her tears.

10:12
And I remember back then, also at the time, we spent a godly amount of money on photography. And so we really wanted all these photos to come out great. And we didn’t want some nasty tissues to be in the pictures as well. So the solution was that my wife wanted to carry a handkerchief with her. And the problem was is we looked everywhere for handkerchiefs. We went to all the malls in our area. We went to all the brick and mortar stores.

10:38
around that could possibly carry these handkerchiefs, but we couldn’t find them anywhere. Now, there was actually one place where we finally managed to track down a handkerchief, which was at David’s Bridal, but it ended up being really ugly, the material was kind of coarse, and it was kind of a very masculine handkerchief. But you know, we ended up buying it anyways because that was going to be our last resort. But you know, my wife actually really hated that hanky, so we started actually looking online for alternatives at this point.

11:08
And after looking for a couple of days online, we ended up finding this vendor in China who carried a wide variety of handkerchiefs, many of which my wife really liked. But there was a catch. This vendor that we found in China was actually a manufacturer of handkerchiefs and the minimum order was on the order of 20 dozen. Now just think about it, you know, that’s 240 handkerchiefs of which we really only needed one or two.

11:36
But my wife liked these designs of these handkerchiefs so much better. So we ended up importing these hankies using about six or so and then selling the rest on eBay. And lo and behold, they sold like hotcakes. Okay, and so when it came time to start our online store years later, we got back in touch with this initial vendor where we purchased our handkerchiefs for our wedding. We kind of ran the numbers to see if it could be a viable business.

12:03
We crossed our fingers and just went ahead and pulled the trigger and launched.

12:09
So that’s just a basic story about how we found our niche. Seeing the success of our business naturally spawned a lot of questions from our friends. Because at the time, all of us were kind of starting to have kids all around the same time, and a lot of my friends wanted to stay at home with their kids as well. So after the first year, I decided to launch a blog to document our experiences with starting our online store. And incidentally, that is how mywifequitterjob.com was born.

12:37
at the end of the year 2008. Now while the blog started out really slowly, it actually had no readers at all in the beginning, and you know how lot of bloggers like to say that the only reader was their mom? I can very confidently say that my mom actually did not read this blog at all because she thought it was just a hobby and she never really thought that blogging could be a very good business model. But slowly and surely, the blog actually started generating some income of its own.

13:07
by the end of the second year. And by 2011, I was actually getting so many e-commerce questions that I decided to launch an e-commerce course. Okay, and so in the March of 2011, I launched Create a Profitable Online Store, which was my course that taught others how to start an online store of their own. And the initial price was $300, and what was kind of unique about my course was that I launched it

13:36
with absolutely no content whatsoever. But, you know, fortunately I had a pretty decent following on the blog and I was extremely lucky to have 35 students take a leap of faith and sign up for my class with the trust that I would deliver the content that would teach them how to start their own businesses. Today my course has well over 500 students and counting and well over 50 hours of tutorial videos. So,

14:04
kind of how I handled this course, kind of treated it like something that would grow slow and steady. So the initial price was 300, started out with zero content, but every single week I would add more and more content, I would answer more and more student questions, and slowly but surely I’ve started to amass a whole lot of content, and over time I’ve raised the price of the course to the current price that it is today. And hopefully by the time you hear this podcast,

14:31
the amount of students in my class will be a lot larger because I am signing up students every single day and the content continues to expand. Okay, and so that’s just a little background story about who I am and what I’ve done up until this point. It’s really been an exhilarating ride and extremely rewarding from both a mental and a monetary standpoint. And you know, best of all, you know, it doesn’t really take a rocket science degree to start.

14:59
And in fact, that’s actually one of the reasons I wanted to start this podcast. It’s because I want to dispel a lot of the myths about small business ownership. So here’s the thing, you know, with the media throwing around phrases like nine out of 10 businesses fail within the first three years, it’s only natural that people are discouraged from actually giving it a try. And in fact, I’ve pulled my readers in the past about, you know, why they haven’t started their own businesses yet.

15:29
And I’ve gotten a multitude of answers, everything from it’s too risky, it costs too much money, I don’t have the technical knowledge, I don’t have the time, it’s just too hard. And based on some of these excuses, I’m gonna actually go ahead and try and address some of those today in this podcast. Okay, and so first and foremost, when it comes to starting an online business, you don’t have to start the next big thing.

15:55
Entrepreneurship is not about trying to start a gigantic company, sacrificing your family and your relationships to make it big. Now in reality, you don’t have to hit a home run. You really just need to go for a base hit. And if you can start a business that allows you to make enough money to support you and your family with a much smaller time commitment, then why not do it? After having two kids myself, I’ve come to learn that spending time with loved ones is precious.

16:24
So your focus should really be about building and strengthening your relationships and doing the things that you love. Life is just too short. So starting a business also doesn’t have to cost a lot of money. And to give you an example, we started our online store for about $630. We bought a computer, a digital camera, paid for some web hosting and some initial inventory, and that’s about it. Okay. And if you were to look today,

16:53
Chances are you already have a computer if you’re listening to this podcast. You already have a digital camera if you have a smartphone. And web hosting is dirt cheap. And so what that means is you can literally start an online business for as little as $5 a month if you take advantage of open source software. And the monetary risk is just so small that it would be a shame not to give it a try. And in fact, I wanted to share a thank you letter that I received the other day.

17:22
from a student in my e-commerce course. It says, know, dear Steve, I’ve been busy since we last talked. I have my site up and running and I have two sales. I did it all myself and I pay a little over $9 a month to maintain my store. With your course and a lot of reading and hard work, I was able to save a lot of money. Okay, so what does that tell you? This student, it’s not just me, this student actually spent less money to start their online store than I did.

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Okay, so you don’t need a whole lot of money to start. Now the next myth I want to dispel is that of requiring a lot of technical knowledge. You don’t need a lot of technical know-how to start your own online business. And once again, to use myself as an example, I started our online business without knowing a lick of HTML, CSS, or PHP. And if you look at the students in my class, 99.9 % of the students in my class

18:21
have very little or no technical knowledge whatsoever, and they’ve still managed to launch great looking shops. And today there are many services out there that will take care of the entire website part for you, and all you have to do is work on taking orders, product fulfillment, and marketing your online store. And the fact is, with open source software, all the software is written for you, and it’s absolutely free. Okay?

18:49
And finally, you know, I want to address the myth of time. A lot of people complain that they don’t have enough time to run an online store or an online business. Now, I have two kids. I still work a full time job. I run an online store, a blog, e-commerce stores, an e-commerce course, and now a podcast. And to be honest, I feel like I have a ton of free time to spend with my family. You know, finding the time is all about being efficient.

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and taking on a slow and steady mindset. And so by setting a little bit of time every day to work on a project, you can actually accomplish a lot over time. And before you know it, by putting a little bit of time in it each and every day, you’ll be ready to launch before you know it. Okay, and so I want to end this first session by talking a little bit about my philosophies regarding entrepreneurship. Now, in case you can’t tell already, in my mind,

19:45
I think everyone should be playing the proverbial slot machine. And what do I mean by that exactly? The best way to explain what I mean is by talking about my favorite card game in Vegas, which is Pygow Poker. Now, the reason I like this game is because you can play for a very long time and make your money last for a long time at the casino. And so here’s how it works. The way Pygow Poker works is that you’re dealt out seven cards.

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and you put together two poker hands, one that’s two cards and one that’s five cards. And you’re basically playing against the dealer here. So if both of your hands beat the dealer, you win. If one hand wins and one hand loses, you tie and no money changes hands. And if the dealer beats you with both of their hands, then the dealer wins. Okay, so as you can imagine, a lot of the times you’re going to be tying. And so, you your money can really last for quite a while. But here’s the kicker with the game.

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Also in this game there’s always a fortune side bet that you can put money on that acts like a slot machine. And if you get a straight or higher you get a huge bonus payout. Now whenever I’m playing Pygow poker I always play the fortune side bet because that’s actually the only way to make a large sum of money playing that game in the casino. Now if you were to just play the regular game of Pygow you might still make a little bit of money playing the regular poker game but the side bet is where it’s at.

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And so how does that apply to real life? The first thing that you need to realize is that you will never ever make life-changing money at your day job unless you have significant equity in your company. Now don’t get me wrong, your day job is good for paying the bills and generally staying afloat, but you will never ever make life-changing money working for someone else. The only way to make life-changing money is by playing the fortune side bet. And by the fortune side bet,

21:40
What I’m talking about is becoming your own boss. Okay, and so I believe that everyone should start out by starting a business on the side. Now, if you’re married, you can have one spouse work and the other take a chance at starting a business. And by doing things this way, you have the early stability of having some income and at the same time, giving yourself the chance to make life-changing money.

22:09
Now, if you’re single, then you can start your business on the side. You know, work at the same time and spend your nights and weekends working on something that can make you life-changing money. Okay, and I just have a couple philosophies about your full-time job as well. When it comes to working a day job, the cushier the job, the better. Now, this might seem a little bit counter-intuitive because most people think that working at a cushy job is bad because you aren’t challenging yourself and

22:38
Conventional wisdom also says that you should change jobs whenever you feel complacent. And in fact, I have friends that do this all the time. And a specific friend that I’m thinking of. Whenever he gets bored, he switches jobs, and more often than not, he ends up working longer hours, he has to prove himself all over again, and he ends up devoting all of his free time working at this new job in order to kind of establish himself all over again.

23:09
Okay, so here’s what I’m proposing. Instead of working longer hours for someone else, why not spend that time on your own business? Now, if it’s the challenge that you’re worrying about, I can guarantee you that running your own business will be infinitely more challenging to start than any day job you’ve ever had, and you’ll actually end up feeling much more fulfilled as well. And if you look at my wife and I,

23:36
Starting a business has really had a tremendous impact on our lives. And so if you’re on the fence about giving it a try, I would say just do it. It doesn’t cost that much money, there’s very little risk involved, and hopefully as I’ve shown you, you really don’t need to be a tech whiz to begin. It’s just about taking action, it’s just about setting aside a little bit of time every single day to work on something that could potentially make you life-changing money.

24:05
and really improve your lifestyle. So I hope you enjoyed this first edition of the podcast. In subsequent episodes, I’m going to be mixing things up and bringing in some guest entrepreneurs to discuss different topics. Now, all of these entrepreneurs that I’ll be bringing in naturally, you know, started their own businesses in order to improve their lifestyle in some way. I’m also going to be bringing in entrepreneurs that are experts in their respective fields. So some of these people will be experts in product sourcing.

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Some of these will be experts at blogging, SEO, you name it. And mixed within some of these interviews, I might do some e-commerce question and answer as well. So stay tuned. I hope you enjoyed this first edition of the podcast and I know you’ll come back for more.

25:03
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