https://www.youtube.com/watch?v=Ec41cSp\_tWc

1 00:00:00.000 --\> 00:01:00.000 in this video i want to break down the
difference between branding and direct response marketing and why not
deeply understanding the differences costing you millions and millions
of dollars and ultimately the amount of money that you probably want to
make and if you don't know who i am my name is alex mozy i own
acquisition.com it's a portfolio of companies that is about 85 million
dollars a year in revenue and i have nothing to sell you all right i
make these videos because i was once broke and i've learned a lot of
lessons on the way and i don't want the pain that i experienced to be in
vain that's why i make these so that being said branding versus direct
response i think this is one of the more interesting topics that i have
dove into over the last year or so and it's come from a variety of
different conversations i've had with top marketers and this morning i
had a conversation with dean graciosi who is a phenomenal world-class
marketer and we talked for like an hour this morning just about this
concept of the difference between branding and direct response and i
thought i would share some of the the lessons or discussion points that
we had with you so that you can hopefully benefit and so the first point
is that you may have heard this in in my book 100 million offers but the
longer you delay the ask the bigger the

2 00:01:00.000 --\> 00:02:00.000 ask can be uh so for example you know
if you're if you can use this in any situation whether you're you know
courting a a lady or a guy or whatever you know if in the first five
seconds you're like hey let's go home together it's like well you might
have some audience to be willing to do that but the vast majority of
people would not be willing to do that but if you date for you know six
months then that might be something that would be almost everybody would
be willing to do that after six months depending on whatever really
beliefs that's not my point here but you can get the idea that a higher
and higher percentage people would be willing to take you up on an offer
if they spend more and more time with you and so the longer the delay
the bigger the ask and the visual that i like to ascribe to this is the
the longer the runway the bigger the plane that can take off and so the
bigger the payload you can get based on the amount you delay to the same
degree if you've seen um garyvee he's he's uh he's an influencer and and
he owns a marketing agency out of new york and he spent i want to say 10
years or 12 years building his personal brand and then he finally had
his ask which was hey buy my nft and then within the span of you know
six months ended up making like a

3 00:02:00.000 --\> 00:03:00.000 hundred million dollars from that nft
launch right now i would make the argument that the nft launch itself
was actually direct request marketing play whereas everything prior to
that was really about building the brand different examples of this that
i think would be important to drive the point home and why i think that
many many many marketers start in direct response and then end up in
branding is because of one about to share with you so please listen
closely to this if you are trying to make more money if you look at most
big consumer brands you look at you know colgate or crest or you know
shampoo brands right that have been here for a very long time they're
not offering two-for-one deals they're not like hey go buy this
toothpaste for 50 off right that's not actually what they're doing
they're just talking about the products and if you look at some of these
bigger celebrities that exist you look at dwayne johnson the rock built
his huge brand and then said hey i'm i'm offering i'm i'm starting this
tequila guy you guys should check it out colin mcgregor conor mcgregor
built up you know his personal brand then said hey check out proper 12.
kylie jenner was like hey built up her brand and then she did her lip
kits and so what's interesting is

4 00:03:00.000 --\> 00:04:00.000 that brand people are now realizing is
an amazing arbitrage opportunity for maximizing value and i think part
of the reason behind this is that goodwill compounds faster than revenue
does and so hear me out think through this with me if you've seen
somebody who's consistently been selling and this may be you what
happens is you provide value in some way and then you extract the value
that you've the equity in the relationship through monetizing it through
an ask or some sort of right hook as they say just getting them to try
and buy something right and the thing is is that whenever you make an
ask you decrease your goodwill right and so you kind of have to start
over at zero again and then you build up goodwill and then you and you
ask and then it goes back to zero again right so you're constantly
depositing and extracting uh capital in the relationship and the hope is
that it costs you less the deposit than you make on the extraction right
like that's fundamentally what like traditional direct response
marketing is at its most basic form right and the reason it is direct
response is that we are actively

5 00:04:00.000 --\> 00:05:00.000 requesting a direct reply or immediate
action as a result of seeing our advertisement right of any kind to
contrast that with branding what we're doing with branding is that we
are reinforcing the values and the stories that people tell about our
products and services all right so we're reinforcing stories versus
asking for actions and you might be like well i you know branding
doesn't make sense and i want to tell you this because when i started
out my career i thought that every single company that did branding was
i was like you guys are idiots if you guys understood how direct
response worked you guys would make more money i'm such a genius blah
blah blah blah and i was wrong as i often am and the more i studied
these massive companies i was like okay so all of these companies all do
this type of marketing whereas little old me is doing this quick you
know jab right hook whatever mark of just of just give ask give ask give
this give ask and always just you know depositing enough value in order
to extract the value later and the

6 00:05:00.000 --\> 00:06:00.000 thing is is people get it people have
seen it they know the game and yes it does work to a limited degree
right but it's very very rare to find a massive massive direct response
company i'm not saying they don't exist but i would say the
preponderance of enormous companies are not direct response based
companies and so why is that and i would pause it and this is my theory
and this is what i talked to dean this morning about at length is the
difference between direct response and branding is not the roi on the
advertisement itself but on the time horizon with which we measure it
all right and so in direct response you're always calculating your
return on ad spend immediately rather than thinking can i build up this
brand and then look at the return you're getting on that brand overall
over an extended period of time and so i'll give you a classic example
to illustrate the difference if i were selling t-shirts a direct
response marketer might have a cool funny meme thing aggressively market
it

7 00:06:00.000 --\> 00:07:00.000 have upsells of two of two of the same
shirts five of the same shirts getting on continuity for each meme shirt
every month blah blah blah blah right that would be a typical direct
response marketing playing not so you can't make money doing it you can
and that's this is the big exception i'm having here right is that like
you can become a millionaire doing small games all right so i'm not
saying you can't do it you absolutely can it's just that what type of
game would you prefer to play and i can say that as i've i've aged or
weathered in the game i continue to shift more and more towards branding
but i do think there's a balance that needs to be struck but from a from
a branding perspective in that same example it would be spending a year
talking about what your values are the the stories that you want people
to tell about you and your company and then you can simply put your
brand on a t-shirt and people will pay a hundred dollars for it right
and so then what is the return on the advertising you did for that year
well if you can sell t-shirts for a hundred dollars rather trying to
rather than trying to arbitrage you know meme t-shirts and

8 00:07:00.000 --\> 00:08:00.000 discounts and bundling and doing all
sorts of more complex things and just simply saying if you believe what
we believe vote with your dollars about the things that you care about
align with us and that's fundamentally what branding is when branding
works very well is when what you are saying about your brand clarifies
what people are already saying and so a lot of times people have a
general gist of what your brand is hopefully it's what you want
oftentimes it's not and this is especially true in the direct response
marketing community at large because people say terrible things about
the people who are doing their drug response and so their brand is the
reputation and the things that other people say about you right and an
example that elon musk gave in interview i can't remember where he gave
it he talked about how the consumer is the one that creates your brand
he said if you look at i think he gave the example of toyota and ford
but the point is not necessarily the brands but more so the message
which is he said listen you know ford talked about being reliable and
being high quality etc he said in toyota their marketing never said that
and yet

9 00:08:00.000 --\> 00:09:00.000 toyota is the company that's known for
being reliable and high quality and things like that compared to the
fords right he said so as much you can say whatever you want in the in
the marketing messaging but it has to be true and so to my
interpretation of that is what you want to do is give people the words
to describe your brand that are true and just give them the words to say
rather than trying to redefine the thoughts they have and i think that
that is really what comes to effective branding and doing that
deliberately as an added point to that this is something that i got from
grant cardone which has been one of one of the really deep and profound
lessons i think i got from our two conversations we've had about
marketing in general but one first off the many people who who don't
like grant you have to appreciate how effective he is at promoting
himself and his brand like you have to respect that all right you can
you cannot like the man but you can act you must respect what his his
level of effort and the outcome and the output of his effort right i
personally have had nothing but positive interactions with the grant but
my point

10 00:09:00.000 --\> 00:10:00.000 is is that you have to respect that
now that being said one of the things that he said that i have really
taken with me is the one or two words that someone will associate with
your brand he said when they think of me i want them to think this right
and that is not uh you know this massive declarative you know value
statement or mission statement because people don't care right nor do
they remember hardly anything and so if you can get the masses to just
remember oh yeah he's the real estate guy he's the business builder guy
right which should be more aligned with what we do we build businesses
and we you know we buy interest in in in information coaching e-learning
type businesses that are in a niche and like that's what i want people
to associate now they're not going to remember all the stuff that i just
said but if i can just if they can just say like he's a digital business
builder like he or like this digital business investor right either of
those things would be things that i would say okay that's a positive
association that's the type of association that i want people to make
with my brand right and the

11 00:10:00.000 --\> 00:11:00.000 thing is is that if i can wait a
longer time which is why most people cannot do this and why i'm not
saying you necessarily have to start branding day one but if you can be
cognizant of what the message that you were relaying in your content and
in the advertising that you do and i'm using advertising by the actual
definition which is to make known right when you when you make your
products and services known in the many ways that you do it if you can
reinforce the simple message in every single thing people will begin as
long as it's aligned with what's true to say the same things back to you
and that will reinforce the cycle of who you are in the marketplace and
what you stand for and so if branding is a higher roi activity overall i
believe it is and i think that there's the many massive companies that
exist out there would be great testaments and evidence to that point is
that they don't engage in direct response marketing for the most part or
even at all to the vast like the vast majority of the time they are
talking much more about who they are

12 00:11:00.000 --\> 00:12:00.000 and what they stand for right why they
do what they do right and then people then buy their products and
service in accordance with their values and they vote with their dollars
but the things that they care about being the identity that they wish to
associate with right and so i think that the reason seth godin started
with direct response and then became and now talks exclusively about
branding the reason simon's index started direct response and then talks
way more about branding the reason that i started in direct response and
talked much more about uh branding stuff now and at least that's my
belief in where i think it's because that's where you make more money
just over a longer time horizon and i think the reason that many direct
response marketers burn out is because they don't like the brand that
they are building for themselves which is why most people leave the
space over a long enough time horizon and so that's why you don't see
many i'm not saying there aren't any but the vast majority of direct
response marketers tend to be younger one of the difficult things about
this and i was having a good conversation with a friend about this is
that because it is such a young space there are no there are not many
people who have old lessons the the predominant

13 00:12:00.000 --\> 00:13:00.000 education that exists in the space is
people who are new the fact that someone can consider themselves a quote
og in the internet marketing space after three years is laughable right
it's laughable it's hilarious but it's true in that space it's very
difficult to be an og because most people burn out because their brand
equity drops so much right and so if the only way that we can build very
big things is doing them the same thing over a long period of time then
it would create the i don't say obvious but a natural conclusion that
branding is the direction that more people end up going in once they
have the ability to do so and so if you can delay the ask and you can
have the resources and you can have the patience to build something
bigger your goodwill will compound faster than your revenue will in a
direct response marketing environment and so this is the concept around
give give give rather than ask give give give comma give give give comma
give give give get and what's interesting is that i

14 00:13:00.000 --\> 00:14:00.000 think most people and the prospects
that are consuming your your content and things like that they are
waiting for the other shoe to drop they're waiting for you to make the
ask and so they have their guard up but if you give give give and then
right when they're expecting you to ask give again and then again and
give even more their guard begins to drop and then they start to think
man this guy or this gal is awesome i really like this person and then
something interesting happens they start telling people about you
because they don't believe that they're sacrificing their own brand
equity by sharing your message that is where the compounding effects of
word of mouth start to take off and so when i say that goodwill
compounds faster than revenue it's because in the traditional example it
would be give give give ask and this isn't me poo poo and gary or
anything like that i mean i think that very much at least establishing
that cadence is useful for most people who are doing a response direct
response at least give something before you ask right but if rather than
asking right where you have to start over at zero

15 00:14:00.000 --\> 00:15:00.000 because you build you build equity you
build value in the relationship and then you asking you back down to
zero and then you build it then you go back down to zero and then you're
basically always capped by the amount of value that you have in the
relationship that's the cap right but the alternative if you were to
look at this visually would be give give give give give give give give
and then it keeps going the chart keeps going off and then at a certain
point a certain percentage of that audience because they have they are
reciprocal in nature type people they will take steps towards you
without you even asking simply because they believe so strongly in what
you have and those the types of clients right that you want to be able
to take on it just takes patience to get there but when you have those
types of clients they get better results they pay bigger premiums and it
also gives you implied scarcity within your products and services and
you're always underselling your demand which will essentially eliminate
your bottleneck that you have in growing because you always have more
demand than you can possibly handle and that is the benefit of building
the brand over the long term rather than

16 00:15:00.000 --\> 00:16:00.000 simply the the one two punches in
order to extract capital today and so if you can delay the amount of
time that you have between when you provide value and when you ask and
ideally you never do you simply allow the goodwill to continue to
compound allow the word of mouth to continue to grow to the point where
you start receiving money probably far far further in the future than
you are now and what you are accustomed to doing but in that future
state you can then look at the minimal amount that you're spending right
in order to distribute your message to advertise right to make known and
then you will see that you have significantly higher returns on your
advertising efforts it just took longer to get there and so
understanding the difference between branding and direct response and
having a longer term perspective and looking at the ogs in the space or
lack thereof and they're people who have transitioned from direct
response to branding i think that there is a lot of lessons that we can
take from it and this is just one of them that i wanted to share with
you and if you're new to the channel welcome to mozi nation um i said
this earlier but our portfolio is about 85 million a year it's actually
a little higher than that i just try to stay consistent but i think it's
probably over 100 now but i i

17 00:16:00.000 --\> 00:17:00.000 make these videos because i struggled
a lot coming up and i and i just i hope that you know the pain that i
went through is not for nothing and so that's why i make these videos so
we we i just i just hope you like it so anyways keep being awesome and
i'll see you guys the next fit
