#11 Membership Sites.


In this episode you’ll discover the ins and outs of another Internet marketing business model – Membership sites.

[And we discuss another aspect of community marketing, James’s upcoming live event in October this year.]
Duration: 53 min – 72MB.

Links & Resources mentioned in Freedom Ocean podcast episode 11:

Click here to find out more about James’s upcoming live event.

James’s own membership site – Internet Marketing Coaching Forum.
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Tim: James Schramko, welcome back to Freedom Ocean my friend.

James: Welcome Tim.

Tim: And listeners, welcome also to Australia’s number one internet marketing podcast where we do our darndest to make this whole concept of internet marketing simple and profitable. Fair call, James?

James: Yeah, they’re two things that I really like.

Tim: You do like those things. How are you mate?

James: Very good, thank you.

Tim: Why?

James: Well, I’ve been missing our call. I’ve been looking forward to it, eager to press ahead.

Tim: We get a few people on our Facebook page and coming through via the email who are saying exactly the same thing. I think when you set an expectation like we did early on with the delivery of a weekly show, one has to meet that expectation. And, it’s been my fault, but we haven’t always – we’re not delivering necessarily weekly on the dot, but we’ll do our best to.

James: Yeah, we’ll, I’m ready to roll whenever you are.

Tim: I know you are mate, I know you are. You are sitting there waiting patiently for the next episode and I thank you for that. Unlike you, I’ve got – well, you’ve probably got many businesses that you’re juggling. I too have many businesses that I’m juggling and sometimes it’s fine, it’s about prioritising and Freedom Ocean is certainly developing into a love and one that we need to keep rolling. Mate, we had great feedback from the last show – episode 10 – where we absolutely pulled apart a basic SEO starter pack, Search Engine Optimisation starter pack. And a couple of just really good insights coming from listeners just saying, you know, very, very grateful – they were articulating how I felt, which was thanks for really explaining in depth what the component parts of an SEO starter pack are, because sometimes I think the industry loves to live in jargon.

James: It’s heavy in jargon and I’ve been around it for six years so I guess, unless someone tells us, it’s very hard to know which bits are confusing or not.

Tim: It really is, and I’ve got a question actually – good, finally a question from Tim – but an additional question: on fiver.com – that little addictive site where you go and spend $5 and have people do all sorts of different things for you – there are lots of businesses offering 100 .edu links or 1,000 .com backlinks. What’s my question there – are they worthwhile? Is it worth pursuing that on top of a more targeted SEO approach?

James: Well, I’m sure there will be some good quality supplies on fiver, it will be hit and miss though. Some of the forums that I frequent lament their wasted $5 on – basically what a lot of these people are doing is just running spamming software in the background, and it could even harm your site.

Tim: Yeah, well that’s what I thought.

James: There’s software out there that’s widely used by people when they want to get fast links. But I just want to point this out, here’s a simple clarification: you do not need a lot of links to dominate the search engine results in most markets, you just need good quality, relevant links. So I can outrank a site that has a lot more links than I do if I get them from better quality places – more relevant, more theme relevant, more care taken with placing them. Now, if you’re in a hyper-competitive market you’re going to need a lot of links as well as good quality links.

Tim: Yeah. Well, I must say, I did a little test – I’ll come clean – I did spend $5 and I did buy 100 backlinks and it did push a site – I’ve got a site that I developed for a family member who’s selling their beach house. The site was doing okay in rankings – no, it wasn’t do okay because it was kind of like, couldn’t get it past page four or five. I subsequently bought these backlinks and the site’s now ranking bottom of page one, top of page two for the keyword and I can only put it down to the fact that the backlinks gave it that kick.

James: It’s more than likely that would have caused that.

Tim: It’s a good feeling when you see that site surge in the rankings isn’t it?

James: Look, I’ve sort of put my finger on this some time ago, the thing that I do about Google, it’s really like a praise machine. It will tell you if you’ve done a good job and it will tell you if you’ve done a bad job because the results are there, everyone can see it. So there’s no messing about – if you do a good job Google shows you, you type in your phrase and find your site ranking really well. And that’s probably one of the things that attracted me to the whole SEO thing is that it’s a meritocracy.

Tim: A meritocracy?

James: Yeah, it’s a system based on merit: you do a good job, you get the gold star, you get the page one listing.

Tim: Yeah, well, it’s certainly true. Now James, let’s get stuck into the guts of this episode – in episodes two and three we discussed 10 internet marketing business models. So for any listener that hasn’t had a listen to those early shows I really recommend they do, because they’re fairly popular episodes where you basically lifted the lid on 10 different ways of exploring or becoming involved in internet marketing. And what we did say is, over the course of coming episodes, we would explore each of those business models in depth. And we’ve done that with affiliate marketing, we’ve done that with product creation and today we’re going to that with building communities, or otherwise known as membership models, we’re going –

James: I think we did the local business marketing as well?

Tim: We did, local business market – I love that one. That’s actually been very good to me over the last few weeks too, some of the learnings in that. So there’s some meaty episodes in the back catalogue and, importantly, the stuff that we’re talking about, it’s not time sensitive. You know, every now and then we may mention something that is time sensitive, but really the content here is not time sensitive. So if you are a new listener to the show I really encourage you to go back and have a listen to those earlier shows, because it sets the scene for what’s to come. So James, building communities or membership models – what is that business model all about?

James: Well, people like to congregate with like-minded groups and, being a community owner, the common format for this would be having a forum. And a forum is where you bring together people – and you can have free forums or paid forums – and the whole idea is that you create that central place where people engage on a continuing basis. Now, as a business owner, if you can create a community – and especially if you can control a community – it puts you in a great position of power to influence what people buy in particular, but also it allows you to keep your finger on the pulse of your market because you have your best raving fans right there in the same place, exchanging value. And there are so many up-sides to it in terms of a business, it’s definitely saleable if you come up with a good name for this community. Some communities you might be aware of, like Facebook –

Tim: That’s a big community.

James: Yeah, LinkedIn is another community. So these things are highly valuable when done on a big scale –

Tim: Freedom Ocean is a community.

James: Freedom Ocean is a community. And if you think about it, like Mark Zuckerberg is not making all of the content on Facebook, he’s not sitting there doing all those billions of page impressions. It’s the users creating the content and creating the experience, so there is quite an element of leverage in this where you can actually have – it’s sort of like a product that creates itself, and the main role of the community owner is to set up the community and manage the community. And you’ve seen Facebook got in trouble about privacy and this sort of stuff – I think one of the major areas to discuss when you’re talking about building a community is what are the guidelines and the rules and your policies and stances on things? You really have to be the judge and the strategic overview person who is going to steer this ship – it’s like having a ship and you have to keep it from running on the rocks. And it’s a continual – it’s like having kids, you know – you’ve got to continually be responsible for the community. So it’s not something you can set up and forget about unless you want to put a layer of management in.

Tim: The forms that a community can take James, and obviously a membership site, forums – are they the two major ones?

James: Well, yeah, social media platforms – when we say forums I’m talking about where you can discuss things as a two-way chatter or a group involvement. You can have micro-communities, like very small communities, which is what I set up when I run masterminds. I have a small community of, say, eight or 10 people together in a little huddle where they can cross-communicate, and they’re very powerful on a high-end business level because what that brings to the table is the ability for people to share ideas without fear that it’s going to be wildly copied or taken because people can complement each other with their strengths.

Tim: That type of community happens via webinar – the high-end mastermind group, that’s webinar and then, in-between webinars, people can communicate via some kind of social network or online forum?

James: Yeah, for that application I use Base Camp which is really good, you get the ability to send emails back and forth or to host files and documents, or you can chat in there if you add on Camp Fire.

Tim: Which is what?

James: It’s really just like Skype where you can chat between members in real time.

Tim: Okay, so it’s audio chat?

James: No, it’s just text chat, like when you’re using Skype. Clearly what we’re talking about is the tools – there’s a bigger framework around the community so who makes up the community, why would they be attracted to it, what value can you offer the community for them to want to be there? And then, of course, you may at some point want to monetise the community, so you could either charge for it upfront or you could have a free community where you have ways for people to pay for things later. Things like Farmville for example, where people play games and you’re part of that Farmville community and you share things, but I’m sure the game is making money from selling advertising to corporates and also – I haven’t played it – but I’m sure there’s probably things you can buy as credits.

Tim: Okay. My kids play Farmville, I must look further into that. I was wondering what those pigs and ducks were doing on my credit card bill! Okay, so in terms of setting up a community James, where do you start? Well, I think “community” is such a broad term. For the sake of this chat shall we talk about community as setting up a membership site or a forum – you tell me?

James: Well, it’s actually probably the other way around. I think when we originally talked about this you were talking about the membership model.

Tim: Yeah.

James: And a community is one of the membership models, and there’s other membership models that don’t involve a community, like your telephone bill, magazine subscription. They’re very easy to set up where you could literally just send out an email every week or every month to people who pay you a monthly fee and there’s no element of forum or discussion involved, it’s just a one-way email. So that’s the simple level. So really, where do you want to start? Do you want to talk about –

Tim: It’s interesting, on the other podcast that I do I have a membership site which the podcast is called Small Business Big Marketing and I have, off the side of that, the Small Business Big Marketing Academy. And that wasn’t easy early on to get traction. Basically what the Academy is, it’s a monthly membership fee in return for really targeted – eight to nine targeted “How to” articles around specific areas of small business marketing, alright? So I’ve been down that path of setting up – what would you call that? That’s a membership model and –

James: Yeah, it would be a membership site.

Tim: Yeah, and as much as it’s a lovely model, once it starts to get going it goes beautifully, but getting that traction is not easy. And we – being Luke and I, Luke my co-host – we looked at that model early on and thought you know what, that’s just something that people would want. They love listening to the show and, as an extension of the show, why don’t we provide some “How to” articles around all these aspects of small business marketing? And it took some time to get traction.

James: Yeah, well there’s a few strategies that might help. So I think it’s good to perhaps address that, how you get traction and how can you create value that people will actually pay for?

Tim: Yeah.

James: Let’s talk about the difference between preference and performance. So this is where you think people would prefer something but then they won’t actually perform it. So you can ask people “Would you pay for six or seven “How to” articles?” and they say “Yeah, sure, we would, absolutely” and then you create it and then they don’t. That’s like, I can probably think of a number of examples you say to people “Would you buy this car if it was 50% off?” and they’d say “Yeah, sure” but then you go back and say “Righto, here it is” and then they’re “Oh no, actually, you know what, I’m quite happy catching the bus”. So basically people are just full of it, I don’t think they even know what they want and, even if you give it to them on a platter, they still come up with excuses. People are experts at finding ways to avoid having to make any sort of commitment or change in their life, so it probably comes down to that. So how do you overcome that resistance? Well, you’ve got to stack the odds in your favour, you’ve got to create something that is extremely exciting and valuable for people, and the best way to get traction is to bring in a whole bunch of people in one hit. That’s how I started my community is I brought in 70-something people – 72 people – in one go and I made it irresistible by making it free, I gave them a trial – I think it was three months – for free. So that gave me two things: it gave me an instant community in terms of numbers and it gave them virtually no resistance to moving forward because they weren’t paying for it. In fact, it was even better than that, it was solving a problem that they had. The way that I started my community was I created that three month coaching environment as a bonus for a product that I was selling, and the product that I was selling was missing out on the community aspect, the coaching side of it. It was information and it was training but it wasn’t hand-holding or showing people how to use the information. So I said look, you buy this product and then I’ll create a coaching environment for you and hold your hand through it, and from that first 75 at least half of them decided that it was a good enough environment to continue paying a fee for every month. And we still have a bunch of our original members after two years, and one of the key factors – and this is another strategy for stick, okay, this is a stick strategy which means a retention strategy – is we grandfathered those original members at a slightly reduced rate.

Tim: What’s grandfathered mean?

James: Grandfathered means we let them stay on an old rate, we hold them into the original rate. So in this case, where we had a $97 a month monthly fee, or a $99 or $95 monthly fee, the original group came in on $67. So when we put the price up, which we’d always planned – so we’d actually strategically planned to put the price up because we felt that the membership was worth more than that – we said to the original people “Look, we’re going to put the price up, if you want to stick around you can continue to pay the original $67, if you were to leave and then come back then it would be at the new rate”. So as long as you know that upfront, and that is a very powerful community-building strategy. I’ve also done that with other programs that I’ve done where I have a continuing or a recurring fee commitment – when I put the price up, generally, where possible or practical, I will hold people in at the older price that they’ve joined on as long as I possibly can, unless I make substantial changes to the program.

Tim: Pricing is always a tough one isn’t it? That’s a good strategy where people – because they’re probably thinking “My God, I’m locked into this wonderful price and the only way of maintaining it is if I stay and keep paying it, otherwise if I choose to leave and come back then I’m going to be up at a higher price”.

James: Yeah, it’s sort of like the golden handcuffs that a lot of corporates use to hold in good staff, invested shares and stuff.

Tim: Okay, so what about software James? We’re talking forum here – what do you need to set up something like this?

James: Well, if you’re going to have a small group then I would look at something like Base Camp, you don’t really need to go beyond that. And I can’t recall anyone else ever mentioning Base Camp as a forum solution, but I’ve found it tremendously powerful and I’ve been using it for a year for that purpose, and it’s really good.

Tim: So that allows people to – I can’t imagine, I haven’t a lot to do with Base Camp but I have had a look at it and I can’t see the forum inside Base Camp. I can see the ability to exchange files and to post things on message boards. How does the forum start to develop in Base Camp?

James: Well, you can basically use the messaging feature to set up topics. In your case, you could set up a small group, say limited to 10 people, on the topic of marketing – because that’s a specialty of yours – and you could go into Base Camp and set up some topic groups. You could say “This is a discussion about direct response marketing” “This is a discussion about branding” “This is a discussion about telephone sales” and now you’ve got a topic thread for those topics. And then your members can back and forth questions and you can answer them, and it will come to your inbox so you don’t even have to log into Base Camp. That’s the most powerful thing about it, you can just type your reply in an email format and hit send and it will go back to everyone joined onto that group.

Tim: That’s clever.

James: I haven’t found anyone else using it this way and it’s certainly not designed as a forum software, but if you only have 10 people I think it’s the perfect solution.

Tim: There is another one called, is there a software called Ning, have you heard of Ning?

James: Yeah, Ning is like an open platform group thing. It’s like your own version of Facebook.

Tim: Yeah, right, okay.

James: I’m not a big fan on building on someone else’s network because when Ning wants to change the rules you might lose your whole community. A way better option is to register your own domain name for the $9 a year, take out some hosting and – even if you wanted to go pro – it’ll be $275 a month for a dedicated server and stick a Vbulletin forum on it. And Vbulletin is going to cost you a couple of hundred bucks, and then you could have someone install it for $50 and away you go – you’ve now got your own platform that you control, you own. This is so easy my 13 year old daughter does this.

Tim: Really?

James: Yes.

Tim: Okay, because the Vbulletin, for people who aren’t aware of what – it’s pretty much, that’s the forum type that’s been around ever since the internet’s been around isn’t it, Vbulletin?

James: Vbulletin is my preferred forum software, it’s the most professional featured forum software that you can buy off the shelf. There’s a free one called PHPBB or BBPHB, I can’t remember, I used to use that. In fact, to get to Vbulletin we tried two different forum softwares, we’ve tried three or four membership gateways – that’s the way to take the money and control access – and we’ve ended up with a solution that we’re really happy with, with some very minor custom programming. And for any Freedom Ocean listener, I’m more than happy to send you a direct referral to a programmer who’s a genius at installing stuff and customising gateways to payment processes.

Tim: All they need to do is reply to any email they get from you or I and they’re going to – which we see all of those. So the Vbulletin – I thought that’s what you would have recommended above Base Camp actually. Are you saying Base Camp –

James: It’s not worth it if you’ve only got a small group.

Tim: Okay.

James: Now, why would someone have a small group? I’ll tell you why – because you can charge a lot of money for a small group. It’s not uncommon to charge a couple of thousand dollars a month per person for a small group of people on a very specific topic that has a high value proposition. So for a business owner to learn about marketing from you, Tim, you could quite easily justify $1,000 or $2,000 a month per person. So if you just do the numbers there, 10 people, $1,000 each, that’s $10,000 a month for a small group of 10 that you manage from Base Camp, which will cost you about $50 a month in fees.

Tim: Well, it’s timely – I didn’t have this in mind when I came up with today’s topic, but it is timely – I’m in the process of creating a service, a product, a service, whatever you want to call it. It’s called Gather Round and basically it’s going to be taking 10 business owners from one industry, okay, so it won’t be 10 business owners from just the service industry or the product industry, it’s actually from an industry. So they might be 10 dentists or 10 chiropractors or 10 real estate agents, whatever it may be, and we will be gathering around, via webinar, for three months, because three months will be enough time a) for me to impart the small business marketing knowledge that I have to them and for them to communicate with each other on a weekly basis, where we get to share something that’s worked and something that’s not working and asking questions of the group. And in between times, in between those webinars, this type of – whether it be Base Camp or Vbulletin – clearly Base Camp sounds like the solution – it’ll fill that gap.

James: For that group, for that term it’s definitely the best solution.

Tim: So that’s in development right now and that’s pretty exciting, I mean, that’s a business model in itself. We should talk about – I mean, I’m not sure what that business model is, whether it be webinar or –

James: It’s called a mastermind.

Tim: It’s a mastermind model. So we won’t talk about that now but –

James: No, no we should because a mastermind is really just a community, it’s a small, fixed term community – fixed term membership we call it. So you’ve got three months. Three months, by the way, I found to be the ideal time. I’ve done three months and I’ve done six months and I’ve done open-ended recurring and three months is great for a mastermind.

Tim: Yeah, well I think beyond that it would just feel as though it’s like – you can achieve a lot in three months basically, after that I think it would drag on.

James: Well, let’s talk about why I conclude that from my own experience, and I’ve just come out of a six month term with 40 people. The problem with six months is, firstly you’re always going to have one in the group that shouldn’t be there and you’re now stuck with them for six months. Secondly, people tend to do the most heavy lifting just before the end of the program, so if you have the end of the program in three months they’ll start working earlier. If they have six months, it’s like Parkinson’s Law – they’ll actually expand the amount of time it takes to do anything, and also you’ll probably be over it by the end of six months. It does get boring helping other people build their business if you’re stuck in it and they’re not pulling their weight. You’ll always have a percentage who do amazingly well, you’ll have a percentage who just shouldn’t be in the group – you can filter as hard as you want but sometimes people sneak in there, it’s like a job interview. And then the middle of the pack will just do a so-so job, and something I’ve learned about myself is I will only engage in high level activities now. If I’m going to work with someone else it’s got to be high level activity or I will lose interest immediately.

Tim: What do you mean high level activity?

James: I only want to work with winners. I want to work with the top few per cent and I’m not interested in the middle of the pack. So for me, I know three months is my limit.

Tim: Yeah. You’ve got another community – well, you’re building communities all over the place James –

James: I’ve got a lot of communities.

Tim: But you are bringing together a community in October this year, 2011 in case people are listening to it next year, but later this year on the Sunshine Coast in Australia – what are you doing?

James: This is where I run a live event and that is a great way to balance out and offer value for a community. It does a lot of things actually. Firstly, it is an event where you can get the most active and best members from your community together into one place at the same time and the atmosphere is electrifying. Like, the people – who all have something in common, all of us internet marketing aliens that the rest of the public just can’t comprehend – come together with a common knowing, so it’s the ultimate in community, a live event. And most of the people in my community know each other or know of each other because they see them in the forum, they see them online, they see them in masterminds and then they actually come and meet face-to-face. The other thing it does, it allows me to reach out to my very best associates who are specialists in their field – and several of them I’m sure you would know – to come along and talk to my community and share expert level knowledge. And that is really exciting for them and it’s really exciting for my community, so it’s a good way for me to further extend my industry contacts, I guess, if you like. The other thing is does, it creates a product, which is nice so I always film it and then I’m able to share that information with a wider audience by being able to take it – and quite often it’s a long time after the fact, I’ll actually hold onto the recording for a while so that the people who attend live get the maximum value.

Tim: Does that affect the product? I mean, it’s interesting you say that because we were talking before we went on air today, I ran a two-day intensive for small business owners in November last year. It is now – what are we in, we’re in May – so six months later I took delivery of the videos of those two days only about two or three weeks ago and part of me says “Oh, you know what, they’re a bit dated”. They’ll be six months old now and by the time I get round to selling them over the course of the coming months, it’ll be 12 months old. Does that matter?

James: Well, does it matter for Grange?

Tim: [laughs] For those overseas listeners, that’s a very expensive wine that takes – how long – 29 years to mature?

James: Well, I know it’s fairly old. I think it comes down to how you program the content. With everything I do I’ve got a baseline operating standard that I want to be able to leverage something. So I’ll actually be quite careful to program my events to make sure that there’s a high degree of evergreen content, so I’m teaching principles that should be around for a while. You can still look at some of my earlier work, in fact I just released a product recently and in part of the process I went back to the things I was creating three and four years ago, and for the most part the principles are exactly the same today. There’ll occasionally be tools – especially in internet marketing – there’ll be some tools change, but if anyone is familiar with my work, you’ll notice that while all the other people were doing their screaming red headline sales letters and aggressive squeeze pages and hyping up people with push-button tools, the whole time I’ve been doing the same thing as I’m doing right now. I’ve been doing good research, finding out the content that people want, delivering it in a non-hypy, sensibly way, building a list of buyers and sending the occasional email with value – it’s the same business model that I’ve had for the last six years and I can now say I was right, they were wrong. And my business has continued to grow and a lot of the other people have crashed and burned. They were running a sprint and I’m running a marathon. So I would say when you’re putting together your workshop just storyboard it, as if you would a book. I mean, books aren’t out of date within a month generally are they, unless it’s a book on twitter techniques by a hyped-up guru.

Tim: Who’d right that?

James: They do.

Tim: They do, yeah.

James: But in any case, it should be look like a good book or a fine wine – you want to get the core elements that are timeless and put those in your program. So if I look at my menu of people coming to the event to talk to us, I’ll be teaching how to set up a dashboard to maintain your seven figure business and the strategy plan that I use to build a seven figure business. And I can tell you, that will still be current in five years’ from now.

Tim: Yeah.

James: I’ll be talking to people about how I make decisions on what business models to pursue and my business focussing that I look at, it’s like a focus finder – I look at it every single week – and I’ll still be doing that in 10 years with minor changes, for sure. There’ll be some strategy things that are timely, probably the most sensitive of things like pay-per-click strategies, but what you’ll find if you go past the strategy is the mindset behind the pay-per-click marketer will always be very similar. I’ve got timeless copywriting stuff, I’ve got how to build a massive business from a brand and design perspective. We’ve got how to mine out industry verticals, you know like your dentist category in particular. We’ve got how to tap into new technology –

Tim: How to drill into the dentist category?

James: Yes, well, that’s funny isn’t it.

Tim: Very punny.

James: Well, to a $40million extent, yes.

Tim: Yeah. And okay, so James, October on the Sunshine Coast – who’s it for? Clearly it’s not for the absolute internet marketing beginner by the sounds of the content?

James: Well, you might think that but then, at the same time, when are people ready to step into the good stuff?

Tim: Fair enough, very good call.

James: That’s like saying a red wine drinker has no place starting off on Grange. Well, it’s interesting you say that because in terms of packaging, a lot of people spend way too much time on their product and not enough time thinking about their buyer. And a friend of mine, Alexi Nicolau, is a top copywriter in this country and I share the same belief that you’ve got to really step into the mindset of the buyer. He’ll be talking about that at this event, and the classic analysis, you know, tapping into the things that customers are too scared to fill out on surveys or that would never admit in public. What I’ve done is, I’ve thought about who should be coming to the events and, as part of my ticketing strategy, I’ll actually be including the digital recordings of my first event that provides the foundation for where people are up to by the time they come to this event. So in theoretical terms and practical terms, if they were to buy a ticket to the event and they were only just starting out, if they were prepared to watch the 12 training modules that are digitally streamed in the membership that I’m providing as part of the ticket, they would actually be ready for the event by the time they get there.

Tim: Wow. Well, that’s a pretty good example of community coming together real time. So, if people want to register – in fact, it’s not even out yet is it to – people can go to FreedomOcean.com and go to the products page and –

James: Yeah, we’ll put a banner on there.

Tim: And we’ll put a banner on there, people can click on that and go ahead and pre-register. Although, look, people might be listening to this show in a month’s time and registration will be well and truly open. Seats are limited James or is it fill it up – what are we talking in terms of numbers?

James: Look, I don’t think seats will be limited. I think there may be better pricing for people who move earlier but I can’t be certain about that. I’m actually not going to hype it up, you know why? Because people have already booked the accommodation and air fares and they don’t even know who’s speaking and how much it costs.

Tim: Tremendous.

James: Now, that should tell you something about the quality of my event. The reason someone should go is not because they’re going to miss out if they don’t book now, it’s not because it’s cheaper if they move fast – it’s because simply knowing this stuff and implementing it in your business is going to make more difference to your following 12 months than just about anything else you could spend three days learning about.

Tim: So three days on the Sunshine Coast, October 2011 and –

James: Yes, amongst very, very motivated and switched on people. There are so many six, seven and eight figure marketers will be at that event. Some of my friends are really, really kicking it and they’re going to be sharing what they do in their business. And this is not one of those pitchathon things where you get slammed down your throat, you know those like free events where you get told sales pitches?

Tim: Like our last episode? [laughs]

James: [laughs] Don’t start, don’t start. This is a value-driven content event.

Tim: Yeah, well that’s great mate.

James: And I’m only doing one a year by the way, of this style of event now. So this is the only one this year.

Tim: Great example of community James, the live community.

James: Should I point out something strategic?

Tim: Yeah, go.

James: When people order this event they will get 60 days’ access to my online forum where they can ask questions and get coached every single day, if they’ve never been a member before. So it doesn’t count for someone who’s already been a member, this is a new member acquisition strategy of mine – I take the risk – and we basically will spend two months answering questions and showing, through our own delivery of value, that it’s worth sticking around longer. And that’s why most people stay along.

Tim: So the idea of a buy-with-bonus strategy – and I can’t even remember whether we’ve spoken about that on Freedom Ocean or whether it’s you and I have just spoken about it – but I don’t think it’s worth offering because already you’ve got the three days attendance at the event, you’ve got your 12 DVD set or 12 online video set of the last event and two months to your forum. There are some seriously good bonuses in there already. What else can Freedom Ocean offer?

James: Well, I could think of a few things actually.

Tim: Yeah, okay.

James: It’s a great conversation to have. So one thing, as the product creator I’ve tried not to stack irrelevant bonuses into this. I mean, I could go and offer a back catalogue of all my DVDs, I could put a pile of junky crap, some resale, right, but I don’t. All they’re getting is a ticket to the workshop, they’re getting training that supports the reason they’re going to the workshop and they’re getting coaching so that they can implement and get stuff done. So there’s three things that complement. What you could do Tim is, you could offer somebody a Skype consult or something, and then you’re competing – I guess Freedom Ocean is competing with potentially other affiliates and some of them, more than likely, will look for complimentary things. Now, people familiar with Freedom Ocean will know that Tim is a marketing genius with ad agency background, especially strong in branding and podcasting. So anyone looking to be involving their business with strong branding or podcasting will more than likely be interested in running their business past you. So you could offer an email consult or a Skype consult if someone bought a ticket through us or you, and that would be a smart thing because they can then further leverage their purchase and get better value from it.

Tim: Well, I think that’s a great idea and I think if we were to set that up on FreedomOcean.com people can go and have a look at what that will involve, but I think the idea of a Skype consult where people can maybe share an idea they’ve got around podcasting or branding and seeking some advice on that, then I’d be happy to give that if they were to book through Freedom Ocean.

James: Yeah, well, what they would do is, they’d use the banner on Freedom Ocean as the last place they visit, they buy a ticket and then they would send you the receipt to the email address that you nominate or to the support desk or whatever, and their Skype details and then you’d be in touch with them.

Tim: Love it.

James: I’ll teach you how to set that up, but the buy-with-bonus method is very good for the customer and the product owner and the affiliate.

Tim: Well, it makes it unique doesn’t it, because there’s only place you can get that bonus?

James: Correct, so you put some thought into the buyer mindset – what would they find valuable?

Tim: Great James. Let’s get back online in terms of building communities. We’ve talked forum, we’ve talked membership site, we’ve talked live event. We’ve talked large – well, we’ve also talked, what would we call Base Camp? Well, a mastermind group. Lots of ways of building communities, more than I thought. And what I love about communities is that, as the world gets bigger and more accessible, communities become more and more important. I read a book about two or three years ago that talked about what the world was going to look like in 50 years’ time and the irony of all this globalisation is that we seek community, you know, because it’s human nature to want to be part of something. And that’s what the community allows, whereas as the world does become global people can feel a bit left behind and a bit – for want of a better word – lonely.

James: Well, that’s one of Maslow’s hierarchy of needs isn’t it, the need to be appreciated?

Tim: That’s it, yeah.

James: The community is a great place for us to go and get praise.

Tim: I ran this workshop last week, 60 – I won’t give too much away because it was for a private client – but it was 60 people from the one industry and they’d come together from all around Australia to hear me rattle on about small business marketing for five hours. And what I noticed was that, whilst I had good quality information to impart, the real power came in these 60 people coming together and sharing their own experiences. And there were times when I was out at the front of the room really just standing back as an observer as other people within the audience said “Oh yeah, I did this” and she said “I did that” and “I’ve tried this and you should try that” and it’s like my God guys, there is so much knowledge within this one room – I actually used the words – you should come together as a community more often than once a year and set up something whereby you can communicate on a regular basis and share this knowledge that otherwise is going to go to waste.

James: Well, that’s a great point and we would be arrogant to think that we would have to provide all of the answers and provide all of the content. The community is what powers it, we become the facilitator.

Tim: Pretty much.

James: I think, again, that’s probably something Mark Zuckerberg was doing with – well, I think he was trying to figure out a way to get dates or something – but he figured out a way just to let people join up and be able to hang out with each other and form groups. So even though it started in the education, it went mainstream. We can do this in our own business and you don’t have to know all the answers, you just have to be able to be a little bit parent-like and facilitate. If you’ve got kids you know what I’m talking about, it’s like creating a thing that you’re responsible for looking after and when you’re the facilitator of a community, like you were in your event, you’re the one that has to put the guidelines out there, but then the energy comes from the participants.

Tim: Yeah. It really does, doesn’t it? I mean, that’s where the power is.

James: There are definitely some dos and don’ts – is it worth just sort of covering off on that?

Tim: Yeah, as we close up.

James: Well, okay, with your mastermind, if you’re going to go for people from the same category you’re going to have to try and set some guidelines about idea sharing and competition. If people are in too similar a category they will lock up and not share because they’ll be ripping each other’s ideas off.

Tim: Can I just put a qualifier on that, I’ve chosen for my gather rounds, they are from the same category because I believe there is great knowledge to be shared amongst business owners in the same category, but they won’t be competitive because I’m choosing categories whereby geographically – let’s say, for example, the real estate category. There will be 10 real estate agents gathering around from 10 very separate geographical areas, so they’re not competing.

James: I just thought it was worth pointing out.

Tim: Absolutely.

James: Because I’ve almost steered the opposite way now for my filter is to have non-compete categories where I’m really just trying to get the business brain flowing from completely non-competitive fields. It’s like where you’d take one real estate agent, one dentist – like a Rotary Club I suppose – you know, you have one of everything and then there’s no chance of them locking up at all. So you could take it either way. In most communities there’ll be the outspoken ones, the community leaders and I suggest you seek them out and support them early. In fact, they will potentially be able to run a good slice of the heavy lifting for you. It doesn’t matter if you go down to the local school tuck shop, there’ll be one parent who just goes above and beyond and wants to do extra stuff and manage the thing and just do higher output. I find those people –

Tim: Yeah, always.

James: I actually have granted a few of them free membership to my community because they’ve gone above and beyond and they really do make up a driving force. And on the downside you’ll get the occasional person that just doesn’t want to fit in and follow the rules and will try to lead your forum – you know like snakes and ladders? They’ll always be trying to stick a slippery dip that slides people out of the forum and into their environment where they can eat them up. So you have to watch out for those guys as well, or the girls – they’re just always trying to push the limit on the rules and manipulate things into their favour, like dropping links to their own resource source or sending private message solicitations to your members. You’ve got to weed them out quickly. When we find them we give them a warning, if they do it again we just ban them for life.

Tim: Yeah, I think that’s really important. It’s been done on more than one occasion in workshops that I’ve run in a live sense where, you’re always going to have people who – for whatever reason – they may be extroverted, they’ve got more to say, they’re opinionated, they’re going to take more of the spotlight and then that leaves less of the spotlight for the introvert and the person who may want to contribute, but just can’t seem to find the airtime. And what I try to do is, early on, just it might be in that first break, I pull the person aside and say “Hey, listen, you’ve got a lot to say and it’s fantastic, so keep it up but just be mindful that there are others who also have things to say and are finding it hard to get the airtime”, or go and find those people who are finding it hard to speak and I might even ask them “Do you want me to just stop and give you a moment to contribute during the course of the day?”. So it’s –

James: I guess the theme that’s coming across here is you’ve got to be a responsible facilitator and look after everyone’s needs, and ultimately just remember – you are in charge. It’s your community and you set the rules, if you’ve gone and had the vision and set up the infrastructure and you’ve decided to create this thing, ultimately, when push comes to shove, you can put your foot down because people can say or think whatever but it’s your thing and you get the final say. So that’s really the ultimate scenario. We’ve hardly ever had to make tough decisions that don’t suit everyone because most people are sensible and get it, just occasionally some people don’t get it and you’ve got to let them know.

Tim: Any other rules you think people should be mindful of if they’re going to go ahead and start a community, or are they the main ones?

James: Well, it can’t be too one-sided for any one person. You can’t possibly think of every contingency upfront. Like, if you’ve got expert contributors they’re going to be milking your forum for leads, they’re going to suck people away to their own sites. You’ve got make a decision, do they offer as much value as what they’re going to take? Then you’ve got how much do you allow people to advertise, where do you let them do it, what are the rules around that, what are your stances on politics, religion, the sort of things that can inflame people easily – do you create a special area for them or do you just prohibit it? These are things that will come up, but most often it will come down to just greedy human nature. Some people are going to want to take more than they give and that’s the one to be mindful of.

Tim: James, that has been another action packed episode of the Ocean which we will draw to a close. Thanks mate, some gold in there. People are downloading the transcriptions at a rate and for those of you who haven’t signed up for them, all they need to do is go to FreedomOcean.com and on the right hand side, if they sign up with their email and first name, you will get a transcription of every episode, which is very kindly being done by a new transcriber James, whose link you will find on the show notes. I get a lot of people asking me for transcribing services and Bridie, her name is, has kindly offered to transcribe our show on an ongoing basis. So if you’re looking for some good transcribing services go and visit our show notes and you’ll find some pretty good links there, including Bridie’s. Anything else on your mind, James, before we close it for another episode?

James: Just keep the comments coming –

Tim: Absolutely.

James: Comment on the blog post or the Facebook fan page.

Tim: We’ve got another listener question show coming up for sure because we’ve got questions still remaining from the last time we did that, and they keep coming through on the email and Facebook. I’m just loving the fact, I’m loving the engagement between people in our community. We get a lot of emails ourselves but I’m also enjoying watching the discussion develop on our Facebook page as well. And if people want to go to that, they can go to LikeFreedomOcean.com and get involved as well. Hey, thanks James. Listeners, don’t forget to go and check the banner out to James’ live event in October and we’ll see you there and, until next time, James – it’s been a pleasure.

James: Thanks Timbo.

Tim: See you mate.


  1. Very interesting episode guys. Thanks! Interesting that you use Basecamp James. If you have a large membership base I suppose $50 isn’t a bad price.

    It’s interesting to note how you offer free membership for a trial period. I guess this method also works well for new software (allowing people to use it for a free trial period)

    Also, a question about affiliate marketing / JV partnerships. If you were new to internet marketing and you happened to be a whizz programmer and you could design a useful tool for marketers to use. What would be the most useful and saleable tool to develop and once you had a beta version ready, how would you go about promoting it?

    • Thanks for your question, Alison. Now I wonder who that whizz programmer could be?! James and I will tackle it on an upcoming episode. Stay tuned.

    • Alison,

      $50 is peanuts for what you get in Basecamp. Any business doing $1000 a month should find huge leverage from it.

      There would be a whole episode to answer your software questions…
      For promoting it – look at Traffic Grab – see the products page for a full description.

    • Alison,

      $50 is peanuts for what you get in Basecamp. Any business doing $1000 a month should find huge leverage from it.

      There is a whole episode to answer your software questions…

  2. Thanks Tim & James 😉

    I do really like the look of traffic grab and the price is excellent!
    @Tim The whizz programmer is a friend of mine. He wants to build WP plugins and keyword tools, so I’ll be interested to see what you have to say in a later episode 😉

    He’s just built a really complex keyword tool that we’re testing at the moment 😉

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