1. What is the upside?
2. What is the downside?
3. Can I live with the downside?
These simple questions can be the difference between success and failure in anything you do in business, marketing or entrepreneurship.
Think about them in regard to a current project you are working on (or a business decision you have made in the past) so you can put them to use now (or in retrospect) as you read this post.
My analysis might have some angles that are different from Keith’s…but he is the inspiration for this post today…and I highly recommend his book.
What is the upside?
Here’s where you put on your most upbeat optimistic hat (with a dash of a delusion of grandeur for grins).
What is the best thing you can dream of accomplishing?
I also recommend that while you are dreaming of the millions you will make from your next big idea, you should also tame your expectations as well…that is, make sure you’ve got Papa Bear upside, Mama Bear upside and Baby Bear upside: Best case, average case, worst case…but all within the category of upside.
And by the way, the best case can be either Papa Bear or Mama Bear. 🙂
Determining how good it can get…with some tempering of results and emotion…is step one.
What is the downside?
Here’s where you need to be ruthless with your idea…and your feelings.
I would suggest that beginning with your “worst case scenario”—with 100% downside—is the way to go so it can be the polar opposite of any upside.
This takes practicing your ruthlessness…looking at every aspect of the idea or project asking the question, “what if this goes completely haywire?”
You need to become a nasty and unrelenting secret shopper on the idea, where you secretly break everything inside the idea… to discover what the ultimate downside is before implementing (which is not easy since it’s probably an idea you might be fond of).
I know this sounds harsh…and I mean it to sound harsh…because harsh will enable you to attack the (most critical) third question with as much accuracy as possible…which is:
Can I live with the downside?
Assuming you were as ruthless as possible in identifying the full downside, this question is a bit beyond, “How does it make you feel?”
Feelings are important…even in business…but “living with the downside” has huge financial implications beginning with cash flow.
Being meticulous with this calculation of the financial downside will be the determining factor on a go/no go decision and set you on a road…well… less stupid (thanks Keith)!
A real-world example from my marketing career
In the mid 1980’s, during my early years at Boardroom Inc., we had a consumer newsletter (newsletter defined as a publication with no advertising and a higher price than most magazines) called Bottom Line/Personal.
Bottom Line was usurping our flagship newsletter, Boardroom Reports, in both circulation and profit…and we wanted to take it to the next level.
At that time, newsletters were usually sold “cash or credit card only with order,” a model not foreign to today’s online marketers of physical or digital products and services…and at the time, it was how newsletters were generally sold as well.
However, magazines were sold on a “bill me later offer” (i.e., a free issue or multiple free issues followed by a bill should the customer want to continue subscribing).
Magazines could afford to do this for a number of reasons:
- If it was on the newsstand already, most knew what it was or have heard of it so getting it into potential subscriber’s hands to sample was the basic first step (rather than a long selling process and asking for a payment up front).
- They could use less expensive formats such as double postcards or simple letters in basic envelopes because much less “selling” was needed.
- Because most magazines work on an advertising model, the distribution of free issues helped advertisers get more eyeballs on their ads…yes, eyeballs were a concept well before the Internet.
- The perceived value of a magazine…glossy and thick (although they are a lot thinner today!) was a form of shock and awe (for free) …but I won’t take that aspect too much further. But it is a factor.
- While over time magazines being sold this way decreased their perceived value (i.e., everyone sold “bill me later” which turned even the most specialty magazines into more of a commodity), it worked…and there was no turning back to a cash-with-order model.
(Sort of like financial advisors soliciting new business via group steak dinners or a timeshare company offering a 75-inch TV just for taking a look at the property. But all models are meant to be broken when you have the appropriate data.)
Here’s how Bottom Line/Personal broke (and reinvented) the bill-me offer for a newsletter using the “magazine model.”
One of our consultants at the time said to us:
“Bottom Line/Personal, content-wise, is more like a magazine without advertising than a newsletter. And evidence shows that everyone loves it when they eventually subscribe (as indicated by the very high renewal rate) …so why not just give it away?”
Basically, this consultant was telling us to sell the newsletter like a magazine…heresy at the time…but potentially game changing for Bottom Line (and the company).
Looking back on this decision, we definitely went through Keith Cunningham’s “three questions” 30+ years before he put them in his book.
I guess we knew they were coming eventually. 🙂
The upside was obvious…many more people trying Bottom Line/Personal before they paid for a subscription would add to the pool of potential subscribers (enhanced by our expertise in list selection).
And if the renewal rates were any indication of what the pay up rate would be on new, trial subscribers getting a free issue, the economics created a potential windfall under all “three bears of scenarios.”
The downside was obvious too…diminishing the value of a newsletter that prided itself on sharing “consumer secrets” not available anywhere else (and now offering a free copy) was risky at a minimum.
In other words, newsletters were more expensive than magazines because the content was sold as information that is much harder to find.
Another downside was financial…without advertising, the free issues were all cost with no immediate payback of anything. Newsflash: Paper and postage are not free.
Also, unlike magazines, we would still need to “sell” in the promotion since it was unknown to the general public so there would be no savings on copywriters, extravagant formats telling the full, unedited Bottom Line story etc….no double postcards for us.
We still needed 12-page letters and all the bells and whistles just to get them to try Bottom Line/Personal for free.
There was no expense cutting available to us on the promotion end; plus, no immediate cash coming in from those promotions using a bill-me-later offer.
But could we live with the downside?
Our calculations said “yes.”
Worst case (on the “feelings scale”) would be a limited (not permanent) exposure to the bill-me offer, even for an extensive test to prove it was a superior offer through pay up and renewals.
And while feelings are important (regarding the exposure of a free offer of an exceptionally valuable newsletter) it came down to whether we could afford it financially, specifically on a cash flow basis.
Under the worst disaster scenario, we would lose money but not go bankrupt and we would be able to recover.
It was clear that the upside beat the downside by a wide margin…and we could live with the downside.
The test was launched and we never looked back (once we had our results of course).
More on that below.
How we identified, protected and exploited our blindside
This is the additional fourth question I added to Keith Cunningham’s “big three”…and I believe it is also relevant here.
We identified our blindside by digging deep to find out that “we don’t know what we don’t know” … or “unknown downsides” …and the best solution was to find experts to help us.
We protected our blindside by hiring the best consultants in the industry at the time, Dick Benson and Gordon Grossman, who had built some of the largest circulation publications in history (including Contest Newsletter and The Reader’s Digest) …and they understood bill-me offers as well as anyone in the world.
When you don’t know what you don’t know, go to people who know everything about what you are involved in, making sure you can not only identify unknown downsides but learn how to live with those as well, with all the relevant numbers.
Once we proved that Bottom Line/Personal could be sold with a bill-me-later offer, we took Dick Benson’s “bogey concept” (i.e., how much can you lose on a new subscription to make your money back over time and under your definition of acceptable profit) and we ran with that…with clarity and conviction…and always believing the numbers.
We even expanded the bogey over time (once we had lots of cash in the bank and could afford to lose even more on an initial subscription) …and we also expanded our offer from one free issue to 3 free issues to 6 free issues…with exponential results.
We couldn’t have done any of that at the outset or we would have gone broke.
But over time, when we were ready to exploit our blindside (once identifying it and protecting it), the results changed the trajectory of the company forever.
Read “Don’t be afraid of the Bogey Man” for more color on how Benson protected our blindside.
And we also ran with Gordon Grossman’s recommendation to build a marketing database, then implemented the most sophisticated regression modelling tactics, which led to the expansion of the “Bottom Line/Personal franchise” (including millions of the best-selling consumer books ever published in direct marketing history).
The result was building Bottom Line/Personal into the largest consumer newsletter (over 1 million subscribers) by first understanding the upside and downside of “giving it away”… and knowing that we could live with the downside.
And once we knew the upside was huge, we were then able to exploit the upside to its full potential by also identifying and protecting our blindside by focusing on what we didn’t know we didn’t know (with a little help from our friends).
As the title of Keith Cunningham’s landmark book illustrates, attacking business decisions in terms of upsides, downsides (and even blindsides if I can add that to the mix), is a brilliant plan of action…and it will guarantee to lead you down a road less stupid. 🙂
It doesn’t matter if the road is a super highway or an unknown path in an uncharted forest.
Every road needs a map.
P.S. The upside of joining the “Breakthrough Advertising QuickStart Bootcamp” is tremendous…and frankly, the downside is virtually non-existent…unless you define $97 and two weeks of the best training available as “downside.”
The real downside is that if you don’t sign up right now, you will be shut out…we only have 6 seats still available and the Bootcamp begins this Tuesday (September 28th).
And if you don’t join, and you are a student of marketing or copywriting, I can safely say you didn’t protect your blindside. 🙂
Here are all of the details…hope to see you on the “inside” this week:
This is a unique opportunity to make sure that buying Gene Schwartz’s classic Breakthrough Advertising will never be seen as an expense but only an opportunity to expand your business…and your life.
I am aware that it is a dense book and not a beginner’s guide to marketing and copywriting, one that needs some additional guidance and coaching to get the most from it.
That’s why I created:
The idea came from the thousands of buyers who have bought Breakthrough Advertising, looking for ways to “put the book to use.”
They bought it for the upside…spent $125 which could be seen as a downside…but those who have signed up for the Bootcamp didn’t want to live with any of those regrets.
Many feared it would go on their shelves to collect dust like so many other expensive books and courses (there’s “digital dust” too in your hard drives) that they never got around to applying to their businesses.
The Bootcamp is an intense sprint which covers a little over two weeks where you will absorb all of the most critical concepts from Breakthrough Advertising:
“Channeling mass desire onto your particular product,” “the levels of sophistication of your market” (and how to approach your prospects at each level), “38 ways to strengthen your headline once you have your basic idea” …and that only takes us to page 58.
Mastering these concepts—and applying them to your specific business–is part of the Bootcamp as well.
The “BA Bootcamp,” is limited to a maximum of 60 people for two weeks which means we will get down and dirty and keep it totally interactive.
Not only with the concepts…but with applications for your particular niche…with time for personalized hot seats and “ask me anything” sessions as well.
As of today, there are only 6 seats remaining.
This is our second time running it and included on that page are success stories from students who participated in the first one.
Their results were astounding.
The next “Breakthrough Advertising QuickStart Bootcamp” begins on Tuesday September 28th and runs through Tuesday October 12th.
There are multiple calls each week…not every day and none on the weekends… all recorded if you miss any.
You’ll receive a firm schedule once you sign up.
Calls are held at 11:00 a.m. U.S. eastern time…they run approximately an hour…there may be some additional surprise calls with guests…and the calls when we do hot seats and “ask me anything” will run a bit longer.
There is also a temporary, interactive, private Facebook Group to get to know your fellow “Bootcamp-mates” …and ask questions throughout.
Note that the “BA Bootcamp” is not a “done for you” course…how could it be at the price we’re charging?
But it is “done with you” …and far from “do-it-yourself.”
There will be homework in-between calls…with follow up coaching…all designed to create or enhance the business of your dreams.
With Breakthrough Advertising, the Bootcamp (and me) as your guides.
And Chris Mason, my marketing partner, will be your guide as well, who you will meet on the information page here.
Go there and check out Chris’ short video and all of the benefits and success stories from former students.
Can’t wait to share all of this upside with you! 🙂