Chat with Dr. Glenn Livingston

In this episode, I talk to Dr. Glenn Livingston about his famous survey methods to profitably enter any new market.

Dr. Glenn, together with his wife and academy co-founder Dr. Sharon Livingston, have sold $30,000,000 in consulting services to major brands like AT&T, American Express and L’Oreal. He has personally worked with over 1,000 coaching clients and directly supervised many coaches, consultants, authors and speakers.

We talk in this episode about:

  • How to Profitably Enter New Markets with Surveys
  • How You Can Use Surveys to Segment Your Customers
  • Product Creation with Surveying your Customers
  • Follows and Upsells

Download the 80/20 Survey Cheat Sheetwe talk about in the interview

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Profitable Business Automation

Profitable Business Automation

 

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[TRANSCRIPT]

Rui Zhi Dong: Hello and welcome to Profitable Business Automation. My name is Rui and today I’ve got Dr. Glenn Livingston with me. So he’™s famously known as the market research guy and he successfully entered 17 different markets using his research techniques.

 

He has also sold $30 million in consulting to companies like American Express, Colgate, AT&T and much more. I’m a very big fan of Dr. Glenn’s systems and I’m very much delighted to have you here on today.

 

Glenn Livingston: Well, thank you very much. I’m very happy to be here and I always like to give my wife credit along with that $30 million statistic because that number accounts both of our consulting sales together.

 

Rui Zhi Dong: All right.

 

Glenn Livingston: [0:00:53] [Inaudible]

 

Rui Zhi Dong: OK, I didn’t know that.

 

Glenn Livingston: That way she won’t slap me when she hears it.

 

Rui Zhi Dong: OK, cool. All right. So to you and your wife.

 

Glenn Livingston: Yes, Dr. Sharon.

 

Rui Zhi Dong: OK. So for people who aren’t familiar with you and Dr. Sharon’s survey methods, can you talk a little bit about what is market research, why market research is important, why surveys are important for small business and entrepreneurs?

 

Glenn Livingston: Well, I guess the best way to say it is that with all the corporate board rooms that I’ve been in and all of the MBAs and universities that we spoke at, all the fancy terms that you heard around in business school, in the end, marketing is just asking people what they want and giving it to them and ideally you ask people what they want. You break them up into groups with similar interests and you talk to them separately about are you going to give them what they want.

 

If you use surveys in the right way, that becomes more of a science than an art and when I was in graduate school, I went to graduate school for psychology but it was the scientist practitioner model and we were taught how to quantify the soul basically, how to quantify the kind of things that you think couldn’t be quantified like mother-infant interactions and feelings of love and all of the human – all the strongest, most basic human emotions.

 

As I proceeded from graduate school and we never had kids and we never committed, so we got to do a lot of things. So in addition to seeing patients, I also started doing some marketing and consulting and I was very immersed in the professional survey research field and what I discovered was that most of these big professional companies weren’t really using surveys in the right way.

 

They didn’t understand that the gold wasn’t really in counting the frequency of a response and kind of figuring out which were the frequently asked questions, but the gold was more in the relationship between the questions, where the segments are, and what was unique about each segment.

 

We can talk more about what that means if you want later on. So I started doing these types of consulting where I would design a survey project and analyze it and it got more and more complex. Then I was very, very successful doing that but when I went out and decided to do my own small business, I forgot it. I got caught up in the fantasy that if you build it, they will come.

 

The market is going to want what I want them to want as opposed to what the market actually wants. I didn’t survey them and I didn’t do my research and I lost well over $2 million when I didn’t have $2 million to lose.

 

Rui Zhi Dong: I think a lot of small businesses, they can relate to that.

 

Glenn Livingston: Yeah, yeah. I mean that fantasy is – it’s like a drug. I mean it’s like falling in love. It’s like infatuation. It’s really, really hard to keep your cool.

 

So what I wound up doing was adopting all the advanced techniques that I’ve been using in my consulting with AT&T and Lipton and Novartis and Whirlpool and everything like that. I wound up adopting it for small business and publishing in particular because I was trying to publish info products and once I did, I had a phenomenal success record which led to people asking me to teach it, which then eventually led to me having a pay per click agency and a kind of large – not large, but high end consulting practice for small businesses and that’s – so I guess in a nutshell, it’s – there’s a lot more to surveys than meets the eye because most people don’t know how to use them.

 

At the same time, you can really understand it in plain English and the benefit of it is that you can break people up into groups, figure out what they want and segment them and follow up with them in their language, giving them what they want. That’s what marketing is all about.

 

Rui Zhi Dong: So what do you think are the biggest mistakes that small businesses make when they first start, when they first create the products and what should they be doing to sort of validate that there actually is demand for whatever it is that they’re trying to get into?

 

Glenn Livingston: Well, first of all, most small businesses don’t talk to customers, especially – I do have a lot of online entrepreneurs and the fantasy of having a computer move electrons around the internet which then wind up in your bank account seems to overtake them and they want to hide behind their computer screen and figure it all out like a mad scientist and you make all this money.

 

I tell them, “What if at the very least you just went into some forums and you recruited?” Nowadays, you can do it in Google Hangouts, a little focus group, and not that it’s scientific but actually get on the phone and talk to them. Actually show them the concept. See what their needs are in the market. See what they think about the competitors. Listen to where their pain points are, just the very, very minimum. Talk to a few dozen people like that and I can’t tell you how many people I come to who just haven’t done that at all.

 

The other big mistake that I think that they make is when they do a survey, they don’t know how to sample for that survey and the best way to sample is to find people who are actively searching to solve a problem because at that moment they’re in heat. The language and concerns and needs of that audience are going to be different than someone who six months later says, “Well, maybe someday they’re going to consider buying a new car.” Someone who’s actually searching for a new car is a much different prospect.

 

So I find that businesses don’t understand that difference. So they don’t intercept the customer with the point of purchase to get the buying language and then secondly, they don’t understand that even those customers are not all the same and they treat them all as one big glob when really there are distinct needs within a search population and they’re also what I call hyper responsive customers. They’re 20 percent of the search population that’s responsible for 80 percent of your business.

 

They don’t really take those distinctions into consideration and so then they develop marketing systems that are just aimed at this one amorphous glob as opposed to the most responsive people and the most responsive segments.

 

Rui Zhi Dong: Yeah, OK. So I’ve got two questions. How do you find people that are in heat and how do you know that they’re in heat?

 

Glenn Livingston: So there are a couple of ways. In the old days, it was possible and you can still do this in Bing. You can’t really do it in Google anymore. In the old days, it was possible to just put up a survey and say that you’re developing a new service or you’re developing a new special – if we went with someone who was selling a car, we’re developing a new deal in a car and we want to know exactly what you’re looking for. So we can give you the best deal and we promise that when the deal is ready, you will be among the first to receive it.

 

If you will just answer these few questions and you ask them why you are looking for a new car today and what specifically triggered you. What is the single biggest problem you have in identifying, finding a new car and how difficult has it been to find that information on the internet?

 

If you could do something like that, there’s a workaround now, but when you could do something like that, and just advertise for people that were searching in that particular term, buy a new car or whatever it is – we’re not very specific, but it’s good enough as an example.

 

Then a number of things would happen. First of all, you would get a sense of what percentage of the people were willing to fill that out and that’s an indicator of the responsiveness and the gaps in the market. Because if what they’re finding when they search for “buy new car” and all the other ads they’re clicking on, if they’re finding what they need, then why are they going to bother to fill out your stupid survey?

 

So if you make a list of keywords to advertise on and you compare the relative response rates on those surveys, you get a sense of where the bigger pain points are in the keyword inventory.

 

Rui Zhi Dong: Can you say what a good sort of average response rate is or does that just vary too much?

 

Glenn Livingston: Well, it varies tremendously by market.

 

Rui Zhi Dong: All right.

 

Glenn Livingston: If you’re talking about a car market, you’re probably not going to get more than a five percent response to a survey like that.

 

Rui Zhi Dong: Right. So if you got six percent, that means that you did really well.

 

Glenn Livingston: Yeah. If you’re talking about a specific – yeah, like a specific health problem that is not overly marketed to – what would be an example?

 

Rui Zhi Dong: Like diabetes?

 

Glenn Livingston: Yeah, but it wouldn’t just be diabetes. Diabetes is pretty crowded. It would be geriatric diabetes. You know what I mean? It would be some term that’s more specific.

 

Rui Zhi Dong: More specific.

 

Glenn Livingston: And there you would be looking at more like 15 or 20 percent.

 

Rui Zhi Dong: OK. So if it’s un-crowded, then 15 to 20 percent is the rough benchmark we will be looking at.

 

Glenn Livingston: Right, but the reason – here’s another way to look at it. Rather than compare it to some relative norm, what you might want to do is use it to estimate your cost per sale because here’s what I found and I know the number is better for information products than I do for hard goods.

 

So I’m going to switch over to information products. Let’s say I’m selling a CD course about emotional eating. What I found is when I set up the surveys in this particular way, that I could get approximately the same percentage of people to opt in to a real site. So what I mean is like you analyze the survey and you find out everything people are saying. They use that information to design your site and figure out what the offer is.

 

I could get about the same percentage of people to opt in a real newsletter or a free report from that information as I could for the survey, when it was a short survey like that.

 

If that was the case, then what does that tell you? It tells you that you can estimate the cost per lead before you even have a product or a launched thing [0:13:39] [Phonetic] just by running the survey.

 

Rui Zhi Dong: Right.

 

Glenn Livingston: And if you take it a step further – and there are a lot of variables and none of this is guaranteed. So please don’t hold me to it but just to understand what these numbers might be good for. If you – for argument’s sake let’s say I got a 10 percent opt-in rate on the keyword “emotional eating” and the clicks were a dollar each. So I know that I’m going to get leads per $10 a piece.

 

It’s not unusual that I could sell an information product for $100 to five percent of those leads, right? So if it would cost me $10 per lead and I’m selling to five percent of the – if I know what’s going to – I’m going to have a $200 cost per sale, either way, I feel that that’s not viable.

 

So right away, I would know, OK, so at least I’m not viable on the frontend. I think to make a business work these days, you really – you don’t want to be in a business where you have to be profitable in the frontend, but that’s a whole other conversation.

 

Rui Zhi Dong: Right.

 

Glenn Livingston: So those percentages are really more valid as a – when you’re estimating cost per lead and cost per sale using them, than they are a – than I can give you an absolute percentage or an absolute norm.

 

Rui Zhi Dong: Right, right.

 

Glenn Livingston: OK. So I think the original question was how do you determine whether these people are – yeah, so that’s one way is the percentage with which they fill out the form.

 

The other way has to do with how they fill out the surveys and if you think about it, this kind of makes sense. There are going to be people who go to an emotional eating website and they will say, “Well, what’s your single biggest problem when it comes to eating?” I can’t stop eating when I’m stressed.

 

There are going to be other people who go to that site and they will say, “I can’t stop eating when I’m stressed. It’s particularly when my mother comes over with her husband who I can’t stand and I just need some particular strategies for dealing with my perverted stepdad.”

 

What’s the difference? The difference is the level of engagement and the level of specificity that the prospective customer is willing to give you and that represents an additional effort and what you will find is – this becomes really clear when you read the responses.

 

In markets where – and in keywords where there is more frustration and people aren’t getting their needs met by particular keywords, you will find you have a higher percentage of people leaving those detailed kinds of responses.

 

If you ask them to a check a box and they have a really hard time finding information, then that’s just like a – through a direct way of figuring out if they’re frustrated. Then I have a little formula. I’ve got a more complicated formula which I can give you a PDF to send out, if you want, that will let your people do this.

 

Rui Zhi Dong: OK.

 

Glenn Livingston: But if you just need it roughly, let’s say you got 100 responses and you export them all and now within that survey, you had a measure of which information people gave you and that opened a new question, and let’s say you can quantify that as the length of the response. Just pure and simple longer responses represent more engaged prospects.

 

Unless you double that number of people clearing the box, let’s say it’s really hard to find the information. So you could in a very rough way call that a measure of frustration, pain and responsiveness. So now you take your spreadsheet.

 

Every survey software will export a spreadsheet and you calculate that value and now you insert the spreadsheet by that value from top to bottom. The highest value is on top and you look at the top 20 percent of answers and now you have your most responsive people and you look at what specifically they’re saying.

 

So now what you have is a content outline for the pain points in that market from the most responsive people and you don’t want to ignore the rest of the people. You definitely want whatever solution you’re coming up with to make it clear that you solve those problems too. But if you address the most responsive people, guess what. You will find that the market is more likely to respond. It just kind of makes sense and that was the formula I used to recover from that $2 million and that I kind of got famous for in the surveying.

 

The workaround Rui is you need to – long story short, you need to put up a website first. It looks like a real business and you have to be – you kind of have to guess at what the market wants by – the easiest way is to look at what the winning vendors in the market are already offering and try to compile something similar.

 

You can get a little more complex and go read all the best selling books on Amazon for that particular keyword and you could search the social media streams to see what people are talking about and look at forums and things like that.

 

But if you put up a site that’s a real site, that the landing page really drives people through an opt-in and a survey, then you will have something that’s more Google-compliant and you could buy the traffic and do exactly what I said. An example of one of those sites would be ScrewYourDiet.com. That’s not the name of the site. This will take you right to the landing page, ScrewYourDiet.com. Yeah.

 

Rui Zhi Dong: So do you think that this is something that will only work on Bing, PPC or AdWords PPC or do you think you can also use this on Facebook for example?

 

Glenn Livingston: Well, you can address the needs of the audience. You can generalize to the audience from which you buy the traffic. So if you will run – now I don’t have as much experience in Facebook as I do in pay per click. I really try to specialize it all for me.

 

But I do have people who do that and you will find an entirely different set of needs which you have to keep in mind in Facebook is that you’re usually going to have many more audiences to deal with in Facebook. So let’s have a particular interest group.

 

You can’t necessarily generalize the results of one interest group and other interest groups. What you want to do is use large interest groups that represent a population you could roll out to or these very, very similar interest groups.

 

Rui Zhi Dong: OK. Using the sort of information that you get from the survey method, so how would you use that information? You were talking about how businesses were failing to segment them. So what are some ways that you can sort of segment the people?

 

Glenn Livingston: Well, let’s take the emotional eating as an example, right? Let’s suppose that when people come through, I find out that there are maybe three segments that represent 60 percent of the hyper responsive people.

 

So we’re really most interested in the most responsive part of the market and we read through their needs and there are quantitative ways that you can do this. But basically you have someone to read through and you categorize them into one of three segments.

 

Let’s say one of them is I am most – I binge the most when I have contact with family. So that’s like the one who talked about eating when their mom comes over.

 

Let’s say you look at it really carefully and you figure out that those people are more likely to have chocolate. Then there’s another segment that says, “I binge when I’m stressed at work or overwhelmed with work.” Those people seem to be eating pizza and potato chips. Then there’s another segment who says that they binge whenever they don’t get sex [0:22:34] [Indiscernible].

 

Those tend to be more men and they run out or have pasta and beer. So now you know and if you look at the ScrewYourDiet.com site, you can see there are some questions that would help you to segment those people.

 

Now, as they’re coming through, you’re asking them these key questions and then you put them into separate follow-up sequences and obviously you talk to one of them about pizza and beer and not getting enough sex and you have videos that are from guys that are about their age and explain to them that gee, I know what it’s like and then you have like a 35-year-old woman who’s talking about her mom came to visit and you know what I mean. You adjust the marketing message.

 

Rui Zhi Dong: So you can really sort of customize your email funnel and your sort of backend according to what information they’ve given you at the front.

 

Glenn Livingston: Yes.

 

Rui Zhi Dong: You can also I guess use the language. So that’s what you were talking about before with the language, right?

 

Glenn Livingston: Yeah. You look at the specific language of each of those segments and if the guys are saying, “Gee, I got blue balls because my wife is cutting me off and I don’t know why but it just seems like pizza and beer is the thing to do.” Trust me guys, you can live through the blue balls. Let me show you some other way to get around it.

 

Rui Zhi Dong: Something else.

 

Glenn Livingston: Yeah. I don’t know if my wife is going to like this interview.

 

Rui Zhi Dong: Well, she got the credit for the $30 million in consulting.

 

Glenn Livingston: She got the credit in the beginning.

 

Rui Zhi Dong: Yeah. So at least she got that. So, what about businesses who are already sort of doing stuff online, already selling? But I think a lot of them – I mean I definitely sort of have the same problems. I just never talk to the customers, right? But then they’re thinking, “Well, what else can I develop for the backend?” What other products should I be doing?

 

What should they be doing for their businesses? I mean they may or may not be running PPC to surveys right. They might be using their existing list.

 

Glenn Livingston: Well, yeah. I mean I developed a message originally to minimize the risk when you were breaking into new markets. Remember, I just lost $2 million and I was very deep in debt. I didn’t have any money. So I couldn’t afford to lose a business that already has a customer list [0:25:28] [Indiscernible] situation because first of all, I will bet you that 80 percent of the business is who – especially those that are selling online.

 

They don’t have an immediate upsell for their consumers. They’re just not quite sure what to sell them next. Have you ever heard of an upsell that lost money?

 

Rui Zhi Dong: Yeah, they’re in heat. I mean you’re catching them while they’re in heat. So even if you sell them something completely ridiculous, I think they will still buy.

 

Glenn Livingston: Right, right. So why not just send an email out to your customers? Email says, “I need your help, Glenn.” I’m doing a – I need your help [first name]. I’m surveying my customers to figure out what needs we haven’t addressed and wondering what is the single biggest problem that we could help you solve that we haven’t done yet and how difficult is it for you to find information elsewhere and why do you say that.

 

What would it mean to you to solve this problem? Then you analyze it in the exact same way. [0:26:40] [Indiscernible] to customers, right? You just need to figure out and you will figure out some key determinants of those customers and now as your customers are coming through, you divide them up to segments and you offer that next thing as a one-click upsell. That’s just like free money. It’s just like I can’t imagine that not worth …

 

Rui Zhi Dong: That’s brilliant.

 

Glenn Livingston: Yeah, yeah. Obviously you can also – you can use that to develop other product lines and services and things like that. It’s not just for one-click upsells but I just thought I would throw it in there because I know that people that are interested in automation, they kind of know how to do that but they haven’t done it. One of the critical differences between successful marketers and people that are not really making it that I’ve seen has been the aggressive use of upselling. Two things, a survey segment and follow-up and then the aggressive use of upselling.

 

Rui Zhi Dong: Right, OK. So, two things that you should be doing are survey and good follow-up and upselling. So if you’re not doing those things, you should be doing them now. So tell me a bit about – so you said you made your $2 million in debt. How did you get out of debt? So I’m not too familiar with the story.

 

Glenn Livingston: Oh, well, I mean part of it was selling information products. I don’t want to mislead people with that because I didn’t make $2 million right away with the information products. We got up to a few hundred thousand dollars a year pretty quickly. Once we kind of figured out the formula …

 

Rui Zhi Dong: Was this on your own products or was this in …

 

Glenn Livingston: My own products, my own products. So what I would do is – the first product was about how to take care of your pet guinea pig.

 

Rui Zhi Dong: All right. I remember that. Yeah, yeah.

 

Glenn Livingston: Yeah, yeah. We weren’t upselling over $100,000 of $10 guinea pig books, but I think if I remember correctly, we got up to like $300,000 or $400,000 a year. But I was so diversified in all the different niches with the guinea pigs and rabbits and then the body language and radon and Sudoku and I wasn’t running a business. I was obsessed with the formula and when I tried to start putting back in some stuff, I just couldn’t keep up with everything.

 

Then I had a whole bunch of fiascos with partners. So while we were doing that simultaneous to doing that, there was a marketing research protocol that I had invented and we had actually sold a long time ago before we lost all the money. This is how we had the money in the first place to get things started.

 

We sold a million dollar project based upon that and so I went back to selling that for a little while. Nothing as large as the original project but that kind of supplemented it and then my wife went back and started doing focus groups and consulting again and so between the few hundred thousand dollars a year we were making from the information products and … [0:30:00]

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