November 25, 2025 • 31 mins
When your agency is growing, but profit stalls, client churn rises, and your team feels the pressure, it’s easy to wonder which lever to pull next. In this episode, I’m joined by Jeremy Shapiro, a seasoned serial entrepreneur with 25+ years of experience whose work has helped business owners break through growth plateaus using a simple, powerful framework he calls the Business Growth Playbook.
We break down the practical levers behind profit expansion, customer lifetime value, pricing strategy, and the hidden churn patterns that quietly cap your growth. If you’ve been relying on more leads to fix what is actually a systems, retention, or profitability bottleneck, this conversation brings the clarity you’ve been looking for.
You’ll walk away with tactical steps you can implement immediately, from value-based pricing to tightening your retention engine, so you can scale with intention, increase profitability, and build a healthier, more sustainable agency.
BOOKS MENTIONED
- Your Business Growth Playbook by Jeremy Shapiro
Get your hands on Jeremy’s full playbook of tried and true strategies today in his latest book Your Business Growth Playbook available on Amazon or at your local bookstore. If you’d like a sample of his book right now, an audio overview of the entire playbook, and your very own complimentary growth checklist, visit YourBusinessGrowthPlaybook.com right now. You can also connect with him on LinkedIn at LinkedIn.com/in/jeremyshapiro/
Join Dr. William Attaway on the Catalytic Leadership podcast as he shares transformative insights to help high-performance entrepreneurs and agency owners achieve Clear-Minded Focus, Calm Control, and Confidence.
- Free 30-Minute Discovery Call:
Ready to elevate your business? Book a free 30-minute discovery call with Dr. William Attaway and start your journey to success.
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Dr. William Attaway (00:00):
I'm so excited today to have Jeremy
Shapiro back on the podcast.
Jeremy is a seasoned serialentrepreneur with over 25 years
of experience.
Since 1996, his businesses haveconsistently served fellow
entrepreneurs.
He is dedicated to helpingestablished business owners
break through plateaus, scaletheir businesses, and achieve
(00:24):
true entrepreneurial freedom.
Jeremy's expertise comes from arich background of launching
and growing his own ventures,including those that provided
the freedom to live abroad withpassive income, as well as
extensive work with individualentrepreneurs through one-on-one
coaching, consulting, smallgroup masterminds, workshops,
(00:44):
and speaking engagements.
He's known for his ability tosimplify complex ideas and
provide practical, actionableinsights.
His mission is to help businessowners transition from being a
solopreneur to a true businessowner, working on their business
rather than just in it.
His new book, Your BusinessGrowth Playbook, provides
(01:07):
practical, tried and truestrategies that Jeremy has
refined through his ownbusinesses, his coaching, his
consulting, and his mastermindgroups.
It's designed to be a guide fordeveloping a personalized
playbook, empowering businessowners to choose and implement
the right strategies to increasenot just revenue, but also
(01:27):
profits.
The emphasis is on action,driving change, moving beyond
just having great ideas thatnever see the light of day.
Jeremy, it's so good to see youagain.
Thanks for being back on theshow.
Thanks so much for inviting meon.
I'm so excited to be here.
Intro (01:45):
Welcome to Catalytic Leadership, the podcast designed
to help leaders intentionallygrow and thrive.
Here is your host, author, andleadership and executive coach,
Dr.
William Attaway.
Dr. William Attaway (02:03):
Man, I'm so enjoying your new book.
And I want to have you talkabout that.
And I want to dive deep intothat.
For those who don't know you,they just heard that
introduction.
What would you add to that?
What's something that you wouldsay, hey, you may not know
this, but this is somethingabout me.
It's worth knowing.
Jeremy Shapiro (02:20):
Yeah, I think you covered so uh so many great
bigger points there uh in mybackground and who I am.
But uh one thing that I thinkis kind of fun is that I think
my last, like, quote, job waslike during my high school
years.
Uh, my first real business wasactually while I was still in
high school.
And by real business, I meanlike with multiple clients and
team members and you know,growing revenues and product
(02:41):
lines and all that.
And ever since then, every oneof my businesses has either been
like a spin-off of an existingbusiness or a sort of like
sister business that supportsthe same core customers.
Uh it's been a really justincredible journey over the
decades in working exclusivelywith business owners, um,
helping them to grow and scaletheir businesses and find what
(03:03):
we call that trueentrepreneurial freedom.
Dr. William Attaway (03:05):
You know, what I love about you is that
you're not just about findingthe answers for yourself and
your businesses, right?
You are constantly trying to bea conduit of what you're
learning, sharing that with yourclients, with those that you
work with, with the world atlarge through your writing.
I think that generous spirit isreally powerful.
And I just want to call thatout for our listeners because
(03:27):
that is not true of everyone.
Yeah.
Well, I appreciate you callingout with us.
Jeremy Shapiro (03:31):
You sharing that.
Um I've I've been called beforelike a dot connector.
Um, I love seeing the patternsand like the way the place we
get that data, um, at least forme, is from working with so many
different business owners.
And when you start to see thecommonalities and challenges,
and then the commonality on thesolution side, that becomes sort
of the source of thesegeneralized solutions that can
(03:53):
be applied to so many differentbusinesses deeply.
As business owners, everyonelikes to think you know, they
have a unique snowflake of abusiness, that they're the only
one to face the problem they'refacing today.
And I always find comfort inknowing whatever the challenge
I'm facing, whether it's inbusiness or in relationships or
in life or in whatever, that I'mprobably not the first one to
face that challenge.
(04:14):
And that there's wisdom outthere, right?
So whatever it is you'refacing, whether it's in
parenting or finance or youknow, career, right, there are
others who've been there beforewho face that challenge and have
found a way through.
So, you know, seek out thatwisdom and share what you can
find.
Dr. William Attaway (04:29):
That's so good.
You know, there's a lot ofreasons why people write books.
You know, uh some people thinkthey're gonna write a book and
they're going to make a milliondollars, you know, in the next
week from that book.
Um as as an author, I try todisabuse people of that notion
because that has not been theexperience of of really myself
or anybody that I knowpersonally.
(04:50):
Yes.
So let's start there.
Why did you write this book?
It's it's a labor of love.
We were talking about thatbefore we hit record, right?
It this is not a smallendeavor.
Jeremy Shapiro (05:00):
Why jump in?
It's interesting.
You know, uh there are manydifferent reasons that that
author has published.
Um, for me, I found that, youknow, when I was working with
business owners, whetherone-on-one or in workshops or
small group masterminds, thechallenges that would come up
would start to repeat, and I'dhear a common theme, right?
And very often what I'd hearfrom business owners is that
(05:22):
they'd plateaued or they'refeeling stuck and they're
looking for some kind ofbreakthrough.
Like what got them to wherethey are now was no longer
getting them to the next level.
And I've experienced thatfirsthand and seen that with so
many business owners as wellover the years.
So when we look at wherethey're stuck and more
importantly, how to get unstuckand back to the growth they
deserve, there is a playbook.
(05:43):
And I didn't realize at thetime, but there was a simple
formula I kept coming back toagain and again and again.
And then when we look at thatformula, there's like three key
variables in that, right?
These three different leversyou can pull in your business.
And if you adjust any one ofthose, it can get you back not
just to increasing revenues, butmore importantly, to increasing
profits.
(06:03):
And so I was coming back to thesame playbook again and again
that was really up here in mymind, right?
Like I knew to go from that,but I hadn't codified that for
our business owners out there todo on their own.
So I started writing more aboutthat.
And that got some really goodtraction.
I'd run some workshops andhelped folks, you know, in group
format to get back to growth.
And we were just using the sameplaybook again and again.
(06:25):
And so this labor of love, youknow, my book is called Your
Business Growth Playbook, ismeant to be used as an
interactive playbook.
You can jump into it, go to thesection you need, right?
Implement a strategy, get aresult, and come back to the
playbook.
So you get to come back to thisagain and again and again as
you level up and then want tokeep doing that again, over and
(06:47):
over.
And so that tool is nowavailable for business owners to
use so they can, you know, dothis self-paced, right?
You could implement beststrategies that have worked for
small businesses as well as Iuse examples not just of you
know clients I've worked with,but also the big name brands
that we all know.
Because guess what?
Like they use the same playbookand the same kinds of
(07:07):
strategies too.
So you get to see sort of thethe case studies on both ends of
that spectrum.
Dr. William Attaway (07:11):
I love that.
Again, there's that generosityin sharing what you've learned.
This is a this is a reallypowerful book.
The levers that you'redescribing are ones that every
business owner has the abilityto touch and to pull.
This is not just for once youhit a certain size or just when
you're starting out.
This is across the spectrum.
(07:32):
Can you talk a little bit aboutthe levers?
Jeremy Shapiro (07:34):
Yeah.
So where these work best iswhen you have an established
business, you're generatingrevenue, you have a funnel or
flow of customers and prospectscoming into the business, right?
If you're still at the stage ofthinking of starting a
business, it's a littlepremature for this.
It's good to know about it,right?
So you're aware of those leversin the business.
But really, this works bestwhen you have that flow of
customers, but like revenue isjust plateaued, right?
(07:56):
So within the formula, we havethe three key variables, F, A,
and Q.
And a lot of most of the booksand things out there really
focus on Q, right?
And that comes down toincreasing the quantity of
customers or how many people arecoming in.
That generally is likemarketing and sales channels and
things that fill the top ofyour funnel, bringing in more
prospects and customers.
(08:17):
And that's great.
We cover that in the book, butthere's really a ton of
education out there on thosetopics, right?
But the other two levers, the Fand the A, that's where I find
there's so much value becausemost business owners don't know
about those, or moreimportantly, how to adjust
those.
And as an avid reader myself,you know, I love reading books,
uh specifically business books,right?
(08:38):
Always have.
Um, I always found that mostbooks get you excited about the
why, and they get you excitedabout the what.
Right.
So you realize, for example, inreading a book, I'll share with
you for me, uh, you know, we'veall heard about core values in
business, right?
Sure.
I heard so many speakers fromstage talk about why it's
(08:58):
important to have core values inyour company, mission, vision,
purpose, and all that.
And I got excited about that.
And then you get the books andthey talk about the what.
So you learn about what corevalues are and the why.
But no one ever wants to talkabout the how.
And that always frustrated mebecause the answer to the how in
so many business books is oh,go hire the author or you know,
(09:19):
go work with the company.
They're using it for lead gen,which that's great, but I get
all excited reading a book andwant to go implement it because
I'm a tactical guy and I'm leftempty-handed unless I want to go
engage with the business.
So it was really important tome as an author to not do that
and instead be solution focused.
And that's why I have aplaybook with the tactics in
there.
So not only do you know thewhy, and not only do you know
(09:42):
the what, but I also provide thehow.
So you can go out there andactually implement these things
in your business, not leftwondering what it is you need to
do.
Dr. William Attaway (09:51):
You know, it's so good.
Uh, that was one of the thingsthat jumped out at me was how
tactical this book is.
This is not theory.
This is not, like you say, thethe the what and the why and go
figure out the how or hire me.
This isn't that.
This gets me into a place whereI'm like, okay, yeah, uh, man,
I want to take this, I want totake this to my team, and I want
(10:12):
to start to delegate some ofthis.
I want us to start executing onthis.
I want to make this happen.
Jeremy Shapiro (10:18):
Yeah, I know some of the earlier uh some of
the editorial reviews we weregetting early on said things
like, you know, dog ear thisbook, come back to it again and
again.
Like this is not just a bookyou read through and you feel
good and you put it back on theshelf.
No, it's meant to be next toyou so you can crack it open,
bookmark the pages of the thingsyou want to get done.
We even have a, you know, oneof the later chapters in the
(10:39):
book is your personal actionplan.
It's where you're gonna putdown what it is you're going to
implement from the book becausethe idea is to implement this.
And I'll share with you a storyI cover in the book about the
British cycling team.
I'm an avid road cyclistmyself, love the world of
cycling, and uh I was really youknow um uh intrigued to find a
(10:59):
story from the world of cyclingthat's so applicable to
business.
The British cycling team wasone of the worst in the world.
They'd gone like decades anddecades and decades being an
awful team.
They were like almost dead laston the world's uh world bike
racing scene.
Um, until they brought in somenew management.
And one of the things newmanagement looked at was this
(11:19):
idea of marginal gains orincremental gains.
So they looked at what are allthe things we can do to get that
competitive edge to grow just alittle bit.
And so they did all kinds ofinteresting experiments.
Like, well, what if we have allof our riders do a really good
job like washing their handsbefore they sit down to eat?
Like, okay, well, that seemslike you should do it anyways,
but let's make sure we reallyenforce that.
(11:40):
Because if we can keep peoplefrom getting a cold, that's X
number of days that they'restill training versus having a
loss on their fitness andeverything else, that means a
cold's not spreading all thesethings.
So, like, what would that mean?
Right?
What if we paint the insides ofthe trucks white?
You might be wondering like,why would you paint the insides
of the team trucks white?
Well, then you can spot dustand dirt and those kinds of
(12:03):
things more easily, which meansyou can keep those clean, which
means the equipment can staycleaner, which means fewer
mechanical issues, and the bikesare in much, much better shape,
right?
All these little, littlethings.
And what they're looking for islike that little 1% incremental
difference.
And what's powerful about thatis if every day they're trying
out little things to get a 1%marginal gain, that's actually
(12:25):
compounding.
You know, there's a quoteattributed to various different
folks from you know Buffett toAlbert Einstein to, you know,
everyone else about the eighthwonder of the world being
compound interest, right?
That the dollar you save today,you know, with growth over
time, has a compoundinginterest.
And that same concept ofcompounding interest applies to
marginal gains, that when youhave a 1% improvement, the next
(12:48):
1% improvement builds on that 1%improvement you've already
gained.
So if you're constantlysharpening and finding that
additional edge, the growth istremendous.
And so in this playbook, thesame concept as there.
I'm not looking for you to readthe book and find one thing
you'll try one time.
Right?
You implement one of thesestrategies, you see your gain,
you come back and add anotherstrategy on and see your gain,
(13:09):
and you keep building on that.
And the playbook is somethingyou can come back to again and
again as a tactical, practicalguide to get you back to growth.
Dr. William Attaway (13:19):
You know, I love what you said about that
earlier review about dog earingthe book.
That is something you come backto again and again.
I I bought the book on Kindleand I read a lot of books that
way because I've always got myphone with me, like most of us.
But I didn't get a third of theway through it before I was
like, okay, I got to get a papercopy of this.
Yeah.
Because I want to make notes.
(13:40):
I want to dog ear some stuff,right?
I want to take some picturesand send it to various members
of the team.
This is one of those books.
And this is why I was soexcited to have you on the show,
to be able to share this withour listeners.
This is one you're gonna wantto get your hands on.
I want to jump into somethingthat really I think people talk
(14:00):
about, but don't reallyunderstand.
You this this jumped out at mein chapter four.
You talk about understandingcustomer lifetime value.
Yeah.
Creating lifetime customers.
I've heard a lot of people talkabout this, but I have not
heard anybody talk about it likeyou did in the book.
Can you share a little bitabout that?
Jeremy Shapiro (14:20):
Yeah.
So one of the really importantnumbers that we need to know in
our business is what the valueof a customer is, right?
Many of us think in terms oftransactions, we look at you
know, daily receipts in abusiness, or we look at monthly
gross revenue, but rarely dobusiness owners stop and look at
what an actual customer isworth.
And when you know what one ofyour customers is worth, that
(14:40):
can do a lot of really powerfulthings for you.
One is when you know how muchyou'll make from a customer,
that can inform you how much youcan spend to acquire a
customer, right?
And when you know how muchyou're willing to spend to
acquire a customer, you canstart to outspend your
competition to acquire acustomer, right?
So let's say, for example, youand another, you know, quote,
(15:03):
competitor sell the same widget,right?
The same commodity item, whichI'd, you know, advise folks not
to have a commodity, but let'sjust say you've got a widget
that you sell for, you know,$50, right?
If your profit margin on thatis, say, $10, then many
businesses would think theabsolute most you could spend to
acquire that customer is $10.
Now, if your business has aback end and you're able to
(15:25):
generate more money just by thatcustomer being in the fold and
being part of your company, thenyou might realize that your
true customer lifetime valuemight be $500.
So if you're willing to spend,say, $20 to acquire a customer,
you'll be negative up front.
But if you know it only takesyou, say, 30, 45 days to come
(15:46):
back into a profitablerelationship, you might be
willing to outspend your quotecompetitor, who's only viewing
that as the $10 they've got tospend.
And now you're able to bring oncustomers and make a lot more
money with them.
So until you know what yourcustomer lifetime value is, you
don't know what to adjust,whether that's how much you
spend to acquire them, right?
Or what you can do in terms ofchurn.
(16:07):
Right.
So for any of our businessesthat have a continuity
component, think membershipprogram, subscription, and so
on, where customers are payingyou like monthly or annually,
right?
Yeah.
You're gonna have churn.
And this is a number that ifyou don't know how to calculate,
you don't know how to adjust.
Right.
So when we look at figuring outchurn, we figure out how many
(16:28):
customers we have at the startof a time frame, call it monthly
or yearly, are the two mostcommon time periods, right?
So you look at how manycustomers are on your continuity
program at the start of that.
You then look at how many youlose over that same time period,
right?
We're not worried about thegain, right?
How many we gain matters forthe following month.
So if we think easy numbers,let's say you have a thousand
(16:50):
customers at the start of themonth.
If you were to lose a hundredof those customers over the
month, right, that's a 10%churn.
You've lost 10% of yourcustomers.
It doesn't matter if you'vegained 200 customers, right?
You've lost a hundred of them.
So at the start of the nextmonth, we had a thousand, we
gained 200, we lost a hundred.
(17:11):
The start of the next month,you're looking at the fact that
you now have 1,100 customers,which that looks good because
there's net growth, but the factis you had a 10% monthly churn.
Right?
That is so costly.
So if we can do something totrim that churn down, right,
that's putting money back inyour pocket.
Because let's just say we'remaking up numbers here,
(17:34):
membership is $100 a month.
If a customer stays with you,let's say eight months, right,
you now know that customer isworth about $800, $100 over that
eight months.
If you're able to reduce thatchurn and keep them with you,
say two months longer, right,you're now going from an $800
customer lifetime value to$1,000.
(17:55):
That's a pretty goodimprovement, right?
While most business owners arefocusing on how do we bring more
customers in, you have a wholepile of customers, you're losing
out the back for usually fourmain reasons, right, why you're
going to turn those customers.
If we can make small tweaks tokeep them with you just a little
bit longer, you're not payingto acquire new customers and
(18:16):
you're keeping ones you alreadyhave.
That is so valuable.
And there's a lot of greatexamples of businesses and
industries that do a phenomenaljob on retention and keeping
customers with them a long time.
And we can learn from them.
And we can implement, and we doimplement those same strategies
to reduce that churn andincrease your customer lifetime
value.
And there's a lot of ways youcan do that, um, but reducing
(18:38):
churn is certainly one of those.
Dr. William Attaway (18:40):
You know, I think I think what you're
hitting on here is somethingthat every business owner who's
listening needs to pay attentionto.
To reduce your churn is one ofthe best ways to grow your
business.
It really is.
And we like you say we focus somuch on acquisition.
Yeah, right.
Getting new customers like leadgen, all the and all that's
(19:00):
important.
But if you're if your back dooris wide open and people are
just flowing out the back,you're eventually gonna have a
real problem because you can'tacquire as fast as a wide
backdoor is gonna let themleave.
Well, and here's the eventuallyit's gonna catch up with you.
Jeremy Shapiro (19:19):
We pay for customer acquisition one time,
right?
Right.
So in the example we were usingbefore, let's say you're
spending $10, $20 to acquire anew customer, right?
And by the way, in someindustries, paying $500 to
$2,000 to acquire a new customeris good money, right?
So, you know, it depends whatindustry you're in.
Whatever the number is for yourbusiness, you should, by the
way, know what it costs toacquire a customer.
(19:42):
And in in SaaS parlance, thiswould be called your CAC or your
customer acquisition cost,right?
That's right.
You should know what thatnumber is, right?
And when you do, you now knowthis is a fixed cost.
You pay one time to bring acustomer in.
Wouldn't it behoove us asbusiness owners to improve that
ROI not by reducing our customeracquisition cost per se, but
(20:04):
increasing the customer lifetimevalue.
There's a ratio that we want tolook at, which is the ratio of
our customer acquisition cost tothat customer lifetime value.
And we deal with ratios.
Sorry if we're getting toonerdy on the math here, right?
We can improve our ratio byeither adjusting the numerator
or the denominator.
So we can reduce customeracquisition cost or we can
increase customer lifetimevalue.
(20:25):
Either one of those gets asimilar result.
Dr. William Attaway (20:28):
Yes.
And we'll ultimately make yourbusiness more profitable and
better over time.
This is the challenge, though.
People focus so much onacquisition and less on
retention.
Jeremy Shapiro (20:38):
Exactly.
Dr. William Attaway (20:39):
And they do have those hot.
I was talking to somebody lastweek, a 12% churn rate.
And I was like, okay, you'vegot to focus on that.
And they were completelyfocused on acquisition.
I'm like, all you have to do,all you have to do is just
extend by a couple months.
Look at what that is.
We ran the numbers.
We ran them right there on thecall.
(20:59):
And they're like, oh mygoodness.
And I'm like, you are leavingthis on the table.
This money is walking out thedoor.
Right.
What why would you not focushere as a business owner?
Jeremy Shapiro (21:10):
The interesting thing too is, you know, when we
look at customer acquisitioncosts and the scalability, one
of the things we often find iswithin a given channel, as you
try and scale that up, youencounter diminishing returns,
right?
That's right.
Um, you know, I've seen thisall the time.
You might be spending, youknow, $20,000 on your ad words
per month and getting a four toone return, right?
(21:30):
For each dollar out, you get $4back in.
Right.
You go to $30,000 in ad spend,and that now goes to three to
one, right?
You go to $40,000 in ad spend,you go to two to one, right?
So your ROI starts to shrink asyou saturate a channel.
Right.
So the solution isn't to growthalways just scaling up a given
channel, right?
Sometimes we've got to look atreducing that back end churn.
(21:53):
Other times, though, there's avery different approach, which I
love, which is uh, and this isa common strategy from the
playbook we talk about, issimply looking at our prices.
Very often as business owners,we set our price and we don't
think to go back and reevaluatefrom time to time, especially in
service-based businesses whereyou've placed a market value on
(22:14):
you and your time and what it isyour company provides.
Yes.
Inflation comes along, right?
Business comes along, yourcalendar gets full, but we have
a perceived notion of what ourtime or what our service or
product is worth.
Right.
Uh there was a business owner Iwas working with.
Um, she had established a newbusiness as a solopreneur and
(22:35):
had scaled pretty quickly to asix-figure business on her own.
And someone had reached out toher and asked her, like, hey,
could could you teach us yourbusiness model?
We want to start the samebusiness you're doing.
Um, can you show us how to dothat?
And so this client of mine hadsaid to me, Well, you know, I'm
trying to figure out what tocharge them.
And so I was thinking, like,you know, maybe a thousand
(22:55):
bucks, uh, I could teach themthe whole business model, but
I've got to cover the cost of myflights in the hotel and meals,
so maybe a little more thanthat.
And she was thinking about likewhat her time was worth on an
hourly basis to go out and teachthe whole business model for a
day.
And I'm looking at this saying,hold on, you're gonna teach
someone all the lessons you'velearned to launch their
(23:15):
six-figure business.
You're charging them a thousandbucks.
And you're trying to figure outhow you're gonna cover the cost
of your flights and hotels withthat.
I'm like, hold on.
Like, they should be coveringall your travel expenses, right?
This is easily a five-figure orhigher engagement because
you're giving them a businessand a box that they can go just
launch or run on their own as anowner-operator small business,
(23:35):
part-time, right?
Yes.
And so we simply added a zero,right?
And that, and that which iswhere I got the nickname, you
know, Jeremy at a zero Shapiro,um, from that conversation.
Because like that isuncomfortable for some service
providers to think about puttinga zero on the end of their
pricing, right?
Yes.
And so the most difficult partwas not just accepting the idea
(23:57):
that, you know, you don't haveto go um with a time-based
value, you can go with avalue-based pricing model,
right?
So swallowing that pill ofothers telling you, no, no, no,
you're worth it.
And here's the value you'redelivering.
That was, you know, obstaclenumber one.
The second was she had topresent that price, right?
And so we we said, like, look,you say it in front of the
(24:20):
mirror, right?
You get comfortable saying it,as silly as it sounds.
And wouldn't you know shepresented the opportunity uh to
this prospect uh of afive-figure engagement to come
out and teach this.
And they said, Yeah, thatsounds good, right?
Which which should tell youlike it probably could have gone
even higher, right?
But at least she got over thathump to present that price.
So very often we see simplytweaking a price on the front
(24:43):
end can make a big difference inbusiness.
And if you've got a continuitybusiness, this is really
interesting because this isrecurring revenue.
So let's say, for example, youhave a $50 a month subscription
service, right?
And your profit margin is $10.
So if we were to increase yourpricing to $60, it's a modest
(25:04):
price increase.
It's not the end of the world,right?
And we're not saying go changethis on all your existing
customers.
You can simply A B test yourlanding page, one with the
normal pricing that you'veestablished and one with with an
experimental price.
And we can look at yourconversions.
Well, wouldn't you know ifyou're able to bring a customer
in at 60 versus 50, your profitmargin just went your profit
(25:26):
went from 10 to 20.
So a modest price increase just2x your profit.
You could technically afford toconvert at 50% of what you were
previously doing and still makethe same profit.
Right?
And the reality is that'srarely the case, right?
Typically, you don't see anychange in your conversion or
(25:46):
even uh, you know, sometimeseven a lift, right?
But even with a smallreduction, you've now still
doubled your profit on everysingle customer coming in.
So sometimes experimenting,even just with what our pricing
is, can yield really big gainsright out the door.
Dr. William Attaway (26:00):
How often do you think people should
evaluate their pricing model?
Jeremy Shapiro (26:04):
Yeah, it's a good question.
It depends, right?
I'm a huge fan of value-basedpricing.
So for our listeners to havelike a commodity widget where
you're just one of a millionsellers on Amazon selling stuff,
well, that's prettychallenging, right?
You want to find a way to getinto more of a what's called
like a blue ocean versus a redocean.
If you haven't read that book,you know, that's a good book to
read.
You don't want to be perceiveduh as just a commodity in a
(26:27):
competitive market.
You want your ideal customer tosee you as the solution who
gets them, right?
When you are the only optionwithin whatever niche you've
created, you have a lot moreflexibility on testing your
pricing and figuring out wherethat should be.
And when we're able to go witha value-based pricing where
(26:47):
someone can think about thereturn on investment of what
they spend with you, and thevalue is still multiples higher
than what you're charging,you're in a great place.
Right?
So um, it's something good tolook at at the very minimum,
like once a year.
But, you know, two to fourtimes a year to check your
pricing is not a bad thing,right?
(27:08):
Um, we talk about uh in thebook, I talk about funnels,
right?
Um we all have a funnel in ourbusiness.
It might be that you have aclick on an ad or a search
engine listing to your website.
From your website, you thenhave an opt-in.
From an opt-in, you have anemail confirmation or a call
schedule or a purchase orwhatever, right?
You have these steps in yourfunnel to when someone becomes a
(27:29):
customer.
And we like to look at theconversion rates at each step of
those funnels and then whatlittle tweaks we can make to
improve the conversions.
And here's somethinginteresting about improving the
conversions on our funnel.
If at any point you have a 100%conversion rate, there actually
might be a problem there,right?
There's something, there'ssomething about having a funnel
(27:50):
that's too effective that isindicative of a problem.
Right.
So if, for example, um everyone of your prospects who you
present the price to buyswithout question, that is a
really good signal that yourpricing is probably too low.
Right.
Um we had a we had a customerwe're working with, they had had
a services-based business, andthis was a really interesting
(28:12):
and wonderful problem, is totake on new clients, there's
typically a multi-month waitingperiod.
So someone would say, Yes, wewant to work with you, and
they'd say, Great, we can bookyou two, three months out.
So one of the things we talkedabout doing, obviously, one is
scaling operations, right, to beable to handle more customers,
right?
But the second was the idea ofputting an expedite fee in to
(28:33):
say to customers, like, youknow, because these are five to
six figure engagements, right?
Right.
So these are customers who arealready spending some good
money.
So we put the idea out there ofhaving um an expedite fee so
customers could essentially buytheir way to the front of the
line, right?
We've all seen this, whetherit's a rush shipping fee or
paying for overnight shipping orwhatever.
We're used to the idea of youcan buy your way to faster
(28:56):
service.
So they put the expedite fee inplace, and a funny thing
happened.
Every single client theyoffered that to said yes and
bought the expedite fee.
Which tells us a few things,right?
Like one, we should have beenoffering this, you know,
earlier.
Um, two, they weren't chargingnearly enough, right?
Because if everyone's sayingyes to it, well, then we've got
(29:17):
to raise that price point whilewe again concurrently, you know,
increase the fulfillment sideeffects, right?
So we raise the price becausewhat we want is that some say
yes to an expedite fee, but notall, right?
So the 100% conversion actuallytells us there's a problem.
And so you raise it to thepoint that not everyone takes
you up on it.
We've seen this like at DisneyWorld and stuff, right, as well,
(29:40):
right?
If everyone takes the fast laneor everyone buys the priority
or whatever it is, then we havea problem.
Right.
If everyone buys the firstclass ticket, the first class
ticket wasn't charged highenough on the flight, and so on
and so on.
So that's good.
Looking at the 100% conversionmight tell you you have an
opportunity there to bring thatpricing up.
Dr. William Attaway (29:58):
Jeremy, every time we talk, uh Walk away
learning something.
And today has been no exceptionto that.
This book is phenomenal.
Cannot recommend it highlyenough to our listeners.
We're going to have a link inthe show notes so you can get
your hands on a copy.
I really encourage you to dothat.
And as one who bought theKindle first, I'm just going to
tell you get the paper becauseyou're going to want to make
(30:19):
some notes.
You're going to want to do somehighlighting, underlining.
This is going to be one yourefer back to.
Jeremy, thank you for sharingso generously today about this.
For writing the book in thefirst place.
If people want to get in touchwith you and learn more about
what you're doing and continueto learn straight from you,
what's the best way for them todo that?
Jeremy Shapiro (30:40):
Yeah, so at your businessgrowthplaybook.com,
you'll be able to find out moreabout the book there, the links
to buy a copy of the book, uh,socials, follow-ups, all that.
Um, I've also got um reallygreat resources for folks who
are interested in uh getting asample of what the book is, as
well as um, you know, I haveupdates around the content from
the book that I send out almostdaily um to all the folks that
(31:02):
are on our list.
These, by the way, are folksjust like you, business owners,
who want to get back to growthor, you know, see even more
growth in the business they'vegot.
So all that and more you canfind over at your businessgrowth
playbook.com.
Dr. William Attaway (31:13):
We'll put that in the show notes as well.
Thanks for inviting me on.
This is fun as always.
Thanks so much for coming backon.
Listeners, I think you see whyI invited him back.
So much value today.
So grateful.
I'm so excited today to have Jeremy
Shapiro back on the podcast.
Jeremy is a seasoned serialentrepreneur with over 25 years
of experience.
Since 1996, his businesses haveconsistently served fellow
entrepreneurs.
He is dedicated to helpingestablished business owners
break through plateaus, scaletheir businesses, and achieve
(00:24):
true entrepreneurial freedom.
Jeremy's expertise comes from arich background of launching
and growing his own ventures,including those that provided
the freedom to live abroad withpassive income, as well as
extensive work with individualentrepreneurs through one-on-one
coaching, consulting, smallgroup masterminds, workshops,
(00:44):
and speaking engagements.
He's known for his ability tosimplify complex ideas and
provide practical, actionableinsights.
His mission is to help businessowners transition from being a
solopreneur to a true businessowner, working on their business
rather than just in it.
His new book, Your BusinessGrowth Playbook, provides
(01:07):
practical, tried and truestrategies that Jeremy has
refined through his ownbusinesses, his coaching, his
consulting, and his mastermindgroups.
It's designed to be a guide fordeveloping a personalized
playbook, empowering businessowners to choose and implement
the right strategies to increasenot just revenue, but also
(01:27):
profits.
The emphasis is on action,driving change, moving beyond
just having great ideas thatnever see the light of day.
Jeremy, it's so good to see youagain.
Thanks for being back on theshow.
Thanks so much for inviting meon.
I'm so excited to be here.
Intro (01:45):
Welcome to Catalytic Leadership, the podcast designed
to help leaders intentionallygrow and thrive.
Here is your host, author, andleadership and executive coach,
Dr.
William Attaway.
Dr. William Attaway (02:03):
Man, I'm so enjoying your new book.
And I want to have you talkabout that.
And I want to dive deep intothat.
For those who don't know you,they just heard that
introduction.
What would you add to that?
What's something that you wouldsay, hey, you may not know
this, but this is somethingabout me.
It's worth knowing.
Jeremy Shapiro (02:20):
Yeah, I think you covered so uh so many great
bigger points there uh in mybackground and who I am.
But uh one thing that I thinkis kind of fun is that I think
my last, like, quote, job waslike during my high school
years.
Uh, my first real business wasactually while I was still in
high school.
And by real business, I meanlike with multiple clients and
team members and you know,growing revenues and product
(02:41):
lines and all that.
And ever since then, every oneof my businesses has either been
like a spin-off of an existingbusiness or a sort of like
sister business that supportsthe same core customers.
Uh it's been a really justincredible journey over the
decades in working exclusivelywith business owners, um,
helping them to grow and scaletheir businesses and find what
(03:03):
we call that trueentrepreneurial freedom.
Dr. William Attaway (03:05):
You know, what I love about you is that
you're not just about findingthe answers for yourself and
your businesses, right?
You are constantly trying to bea conduit of what you're
learning, sharing that with yourclients, with those that you
work with, with the world atlarge through your writing.
I think that generous spirit isreally powerful.
And I just want to call thatout for our listeners because
(03:27):
that is not true of everyone.
Yeah.
Well, I appreciate you callingout with us.
Jeremy Shapiro (03:31):
You sharing that.
Um I've I've been called beforelike a dot connector.
Um, I love seeing the patternsand like the way the place we
get that data, um, at least forme, is from working with so many
different business owners.
And when you start to see thecommonalities and challenges,
and then the commonality on thesolution side, that becomes sort
of the source of thesegeneralized solutions that can
(03:53):
be applied to so many differentbusinesses deeply.
As business owners, everyonelikes to think you know, they
have a unique snowflake of abusiness, that they're the only
one to face the problem they'refacing today.
And I always find comfort inknowing whatever the challenge
I'm facing, whether it's inbusiness or in relationships or
in life or in whatever, that I'mprobably not the first one to
face that challenge.
(04:14):
And that there's wisdom outthere, right?
So whatever it is you'refacing, whether it's in
parenting or finance or youknow, career, right, there are
others who've been there beforewho face that challenge and have
found a way through.
So, you know, seek out thatwisdom and share what you can
find.
Dr. William Attaway (04:29):
That's so good.
You know, there's a lot ofreasons why people write books.
You know, uh some people thinkthey're gonna write a book and
they're going to make a milliondollars, you know, in the next
week from that book.
Um as as an author, I try todisabuse people of that notion
because that has not been theexperience of of really myself
or anybody that I knowpersonally.
(04:50):
Yes.
So let's start there.
Why did you write this book?
It's it's a labor of love.
We were talking about thatbefore we hit record, right?
It this is not a smallendeavor.
Jeremy Shapiro (05:00):
Why jump in?
It's interesting.
You know, uh there are manydifferent reasons that that
author has published.
Um, for me, I found that, youknow, when I was working with
business owners, whetherone-on-one or in workshops or
small group masterminds, thechallenges that would come up
would start to repeat, and I'dhear a common theme, right?
And very often what I'd hearfrom business owners is that
(05:22):
they'd plateaued or they'refeeling stuck and they're
looking for some kind ofbreakthrough.
Like what got them to wherethey are now was no longer
getting them to the next level.
And I've experienced thatfirsthand and seen that with so
many business owners as wellover the years.
So when we look at wherethey're stuck and more
importantly, how to get unstuckand back to the growth they
deserve, there is a playbook.
(05:43):
And I didn't realize at thetime, but there was a simple
formula I kept coming back toagain and again and again.
And then when we look at thatformula, there's like three key
variables in that, right?
These three different leversyou can pull in your business.
And if you adjust any one ofthose, it can get you back not
just to increasing revenues, butmore importantly, to increasing
profits.
(06:03):
And so I was coming back to thesame playbook again and again
that was really up here in mymind, right?
Like I knew to go from that,but I hadn't codified that for
our business owners out there todo on their own.
So I started writing more aboutthat.
And that got some really goodtraction.
I'd run some workshops andhelped folks, you know, in group
format to get back to growth.
And we were just using the sameplaybook again and again.
(06:25):
And so this labor of love, youknow, my book is called Your
Business Growth Playbook, ismeant to be used as an
interactive playbook.
You can jump into it, go to thesection you need, right?
Implement a strategy, get aresult, and come back to the
playbook.
So you get to come back to thisagain and again and again as
you level up and then want tokeep doing that again, over and
(06:47):
over.
And so that tool is nowavailable for business owners to
use so they can, you know, dothis self-paced, right?
You could implement beststrategies that have worked for
small businesses as well as Iuse examples not just of you
know clients I've worked with,but also the big name brands
that we all know.
Because guess what?
Like they use the same playbookand the same kinds of
(07:07):
strategies too.
So you get to see sort of thethe case studies on both ends of
that spectrum.
Dr. William Attaway (07:11):
I love that.
Again, there's that generosityin sharing what you've learned.
This is a this is a reallypowerful book.
The levers that you'redescribing are ones that every
business owner has the abilityto touch and to pull.
This is not just for once youhit a certain size or just when
you're starting out.
This is across the spectrum.
(07:32):
Can you talk a little bit aboutthe levers?
Jeremy Shapiro (07:34):
Yeah.
So where these work best iswhen you have an established
business, you're generatingrevenue, you have a funnel or
flow of customers and prospectscoming into the business, right?
If you're still at the stage ofthinking of starting a
business, it's a littlepremature for this.
It's good to know about it,right?
So you're aware of those leversin the business.
But really, this works bestwhen you have that flow of
customers, but like revenue isjust plateaued, right?
(07:56):
So within the formula, we havethe three key variables, F, A,
and Q.
And a lot of most of the booksand things out there really
focus on Q, right?
And that comes down toincreasing the quantity of
customers or how many people arecoming in.
That generally is likemarketing and sales channels and
things that fill the top ofyour funnel, bringing in more
prospects and customers.
(08:17):
And that's great.
We cover that in the book, butthere's really a ton of
education out there on thosetopics, right?
But the other two levers, the Fand the A, that's where I find
there's so much value becausemost business owners don't know
about those, or moreimportantly, how to adjust
those.
And as an avid reader myself,you know, I love reading books,
uh specifically business books,right?
(08:38):
Always have.
Um, I always found that mostbooks get you excited about the
why, and they get you excitedabout the what.
Right.
So you realize, for example, inreading a book, I'll share with
you for me, uh, you know, we'veall heard about core values in
business, right?
Sure.
I heard so many speakers fromstage talk about why it's
(08:58):
important to have core values inyour company, mission, vision,
purpose, and all that.
And I got excited about that.
And then you get the books andthey talk about the what.
So you learn about what corevalues are and the why.
But no one ever wants to talkabout the how.
And that always frustrated mebecause the answer to the how in
so many business books is oh,go hire the author or you know,
(09:19):
go work with the company.
They're using it for lead gen,which that's great, but I get
all excited reading a book andwant to go implement it because
I'm a tactical guy and I'm leftempty-handed unless I want to go
engage with the business.
So it was really important tome as an author to not do that
and instead be solution focused.
And that's why I have aplaybook with the tactics in
there.
So not only do you know thewhy, and not only do you know
(09:42):
the what, but I also provide thehow.
So you can go out there andactually implement these things
in your business, not leftwondering what it is you need to
do.
Dr. William Attaway (09:51):
You know, it's so good.
Uh, that was one of the thingsthat jumped out at me was how
tactical this book is.
This is not theory.
This is not, like you say, thethe the what and the why and go
figure out the how or hire me.
This isn't that.
This gets me into a place whereI'm like, okay, yeah, uh, man,
I want to take this, I want totake this to my team, and I want
(10:12):
to start to delegate some ofthis.
I want us to start executing onthis.
I want to make this happen.
Jeremy Shapiro (10:18):
Yeah, I know some of the earlier uh some of
the editorial reviews we weregetting early on said things
like, you know, dog ear thisbook, come back to it again and
again.
Like this is not just a bookyou read through and you feel
good and you put it back on theshelf.
No, it's meant to be next toyou so you can crack it open,
bookmark the pages of the thingsyou want to get done.
We even have a, you know, oneof the later chapters in the
(10:39):
book is your personal actionplan.
It's where you're gonna putdown what it is you're going to
implement from the book becausethe idea is to implement this.
And I'll share with you a storyI cover in the book about the
British cycling team.
I'm an avid road cyclistmyself, love the world of
cycling, and uh I was really youknow um uh intrigued to find a
(10:59):
story from the world of cyclingthat's so applicable to
business.
The British cycling team wasone of the worst in the world.
They'd gone like decades anddecades and decades being an
awful team.
They were like almost dead laston the world's uh world bike
racing scene.
Um, until they brought in somenew management.
And one of the things newmanagement looked at was this
(11:19):
idea of marginal gains orincremental gains.
So they looked at what are allthe things we can do to get that
competitive edge to grow just alittle bit.
And so they did all kinds ofinteresting experiments.
Like, well, what if we have allof our riders do a really good
job like washing their handsbefore they sit down to eat?
Like, okay, well, that seemslike you should do it anyways,
but let's make sure we reallyenforce that.
(11:40):
Because if we can keep peoplefrom getting a cold, that's X
number of days that they'restill training versus having a
loss on their fitness andeverything else, that means a
cold's not spreading all thesethings.
So, like, what would that mean?
Right?
What if we paint the insides ofthe trucks white?
You might be wondering like,why would you paint the insides
of the team trucks white?
Well, then you can spot dustand dirt and those kinds of
(12:03):
things more easily, which meansyou can keep those clean, which
means the equipment can staycleaner, which means fewer
mechanical issues, and the bikesare in much, much better shape,
right?
All these little, littlethings.
And what they're looking for islike that little 1% incremental
difference.
And what's powerful about thatis if every day they're trying
out little things to get a 1%marginal gain, that's actually
(12:25):
compounding.
You know, there's a quoteattributed to various different
folks from you know Buffett toAlbert Einstein to, you know,
everyone else about the eighthwonder of the world being
compound interest, right?
That the dollar you save today,you know, with growth over
time, has a compoundinginterest.
And that same concept ofcompounding interest applies to
marginal gains, that when youhave a 1% improvement, the next
(12:48):
1% improvement builds on that 1%improvement you've already
gained.
So if you're constantlysharpening and finding that
additional edge, the growth istremendous.
And so in this playbook, thesame concept as there.
I'm not looking for you to readthe book and find one thing
you'll try one time.
Right?
You implement one of thesestrategies, you see your gain,
you come back and add anotherstrategy on and see your gain,
(13:09):
and you keep building on that.
And the playbook is somethingyou can come back to again and
again as a tactical, practicalguide to get you back to growth.
Dr. William Attaway (13:19):
You know, I love what you said about that
earlier review about dog earingthe book.
That is something you come backto again and again.
I I bought the book on Kindleand I read a lot of books that
way because I've always got myphone with me, like most of us.
But I didn't get a third of theway through it before I was
like, okay, I got to get a papercopy of this.
Yeah.
Because I want to make notes.
(13:40):
I want to dog ear some stuff,right?
I want to take some picturesand send it to various members
of the team.
This is one of those books.
And this is why I was soexcited to have you on the show,
to be able to share this withour listeners.
This is one you're gonna wantto get your hands on.
I want to jump into somethingthat really I think people talk
(14:00):
about, but don't reallyunderstand.
You this this jumped out at mein chapter four.
You talk about understandingcustomer lifetime value.
Yeah.
Creating lifetime customers.
I've heard a lot of people talkabout this, but I have not
heard anybody talk about it likeyou did in the book.
Can you share a little bitabout that?
Jeremy Shapiro (14:20):
Yeah.
So one of the really importantnumbers that we need to know in
our business is what the valueof a customer is, right?
Many of us think in terms oftransactions, we look at you
know, daily receipts in abusiness, or we look at monthly
gross revenue, but rarely dobusiness owners stop and look at
what an actual customer isworth.
And when you know what one ofyour customers is worth, that
(14:40):
can do a lot of really powerfulthings for you.
One is when you know how muchyou'll make from a customer,
that can inform you how much youcan spend to acquire a
customer, right?
And when you know how muchyou're willing to spend to
acquire a customer, you canstart to outspend your
competition to acquire acustomer, right?
So let's say, for example, youand another, you know, quote,
(15:03):
competitor sell the same widget,right?
The same commodity item, whichI'd, you know, advise folks not
to have a commodity, but let'sjust say you've got a widget
that you sell for, you know,$50, right?
If your profit margin on thatis, say, $10, then many
businesses would think theabsolute most you could spend to
acquire that customer is $10.
Now, if your business has aback end and you're able to
(15:25):
generate more money just by thatcustomer being in the fold and
being part of your company, thenyou might realize that your
true customer lifetime valuemight be $500.
So if you're willing to spend,say, $20 to acquire a customer,
you'll be negative up front.
But if you know it only takesyou, say, 30, 45 days to come
(15:46):
back into a profitablerelationship, you might be
willing to outspend your quotecompetitor, who's only viewing
that as the $10 they've got tospend.
And now you're able to bring oncustomers and make a lot more
money with them.
So until you know what yourcustomer lifetime value is, you
don't know what to adjust,whether that's how much you
spend to acquire them, right?
Or what you can do in terms ofchurn.
(16:07):
Right.
So for any of our businessesthat have a continuity
component, think membershipprogram, subscription, and so
on, where customers are payingyou like monthly or annually,
right?
Yeah.
You're gonna have churn.
And this is a number that ifyou don't know how to calculate,
you don't know how to adjust.
Right.
So when we look at figuring outchurn, we figure out how many
(16:28):
customers we have at the startof a time frame, call it monthly
or yearly, are the two mostcommon time periods, right?
So you look at how manycustomers are on your continuity
program at the start of that.
You then look at how many youlose over that same time period,
right?
We're not worried about thegain, right?
How many we gain matters forthe following month.
So if we think easy numbers,let's say you have a thousand
(16:50):
customers at the start of themonth.
If you were to lose a hundredof those customers over the
month, right, that's a 10%churn.
You've lost 10% of yourcustomers.
It doesn't matter if you'vegained 200 customers, right?
You've lost a hundred of them.
So at the start of the nextmonth, we had a thousand, we
gained 200, we lost a hundred.
(17:11):
The start of the next month,you're looking at the fact that
you now have 1,100 customers,which that looks good because
there's net growth, but the factis you had a 10% monthly churn.
Right?
That is so costly.
So if we can do something totrim that churn down, right,
that's putting money back inyour pocket.
Because let's just say we'remaking up numbers here,
(17:34):
membership is $100 a month.
If a customer stays with you,let's say eight months, right,
you now know that customer isworth about $800, $100 over that
eight months.
If you're able to reduce thatchurn and keep them with you,
say two months longer, right,you're now going from an $800
customer lifetime value to$1,000.
(17:55):
That's a pretty goodimprovement, right?
While most business owners arefocusing on how do we bring more
customers in, you have a wholepile of customers, you're losing
out the back for usually fourmain reasons, right, why you're
going to turn those customers.
If we can make small tweaks tokeep them with you just a little
bit longer, you're not payingto acquire new customers and
(18:16):
you're keeping ones you alreadyhave.
That is so valuable.
And there's a lot of greatexamples of businesses and
industries that do a phenomenaljob on retention and keeping
customers with them a long time.
And we can learn from them.
And we can implement, and we doimplement those same strategies
to reduce that churn andincrease your customer lifetime
value.
And there's a lot of ways youcan do that, um, but reducing
(18:38):
churn is certainly one of those.
Dr. William Attaway (18:40):
You know, I think I think what you're
hitting on here is somethingthat every business owner who's
listening needs to pay attentionto.
To reduce your churn is one ofthe best ways to grow your
business.
It really is.
And we like you say we focus somuch on acquisition.
Yeah, right.
Getting new customers like leadgen, all the and all that's
(19:00):
important.
But if you're if your back dooris wide open and people are
just flowing out the back,you're eventually gonna have a
real problem because you can'tacquire as fast as a wide
backdoor is gonna let themleave.
Well, and here's the eventuallyit's gonna catch up with you.
Jeremy Shapiro (19:19):
We pay for customer acquisition one time,
right?
Right.
So in the example we were usingbefore, let's say you're
spending $10, $20 to acquire anew customer, right?
And by the way, in someindustries, paying $500 to
$2,000 to acquire a new customeris good money, right?
So, you know, it depends whatindustry you're in.
Whatever the number is for yourbusiness, you should, by the
way, know what it costs toacquire a customer.
(19:42):
And in in SaaS parlance, thiswould be called your CAC or your
customer acquisition cost,right?
That's right.
You should know what thatnumber is, right?
And when you do, you now knowthis is a fixed cost.
You pay one time to bring acustomer in.
Wouldn't it behoove us asbusiness owners to improve that
ROI not by reducing our customeracquisition cost per se, but
(20:04):
increasing the customer lifetimevalue.
There's a ratio that we want tolook at, which is the ratio of
our customer acquisition cost tothat customer lifetime value.
And we deal with ratios.
Sorry if we're getting toonerdy on the math here, right?
We can improve our ratio byeither adjusting the numerator
or the denominator.
So we can reduce customeracquisition cost or we can
increase customer lifetimevalue.
(20:25):
Either one of those gets asimilar result.
Dr. William Attaway (20:28):
Yes.
And we'll ultimately make yourbusiness more profitable and
better over time.
This is the challenge, though.
People focus so much onacquisition and less on
retention.
Jeremy Shapiro (20:38):
Exactly.
Dr. William Attaway (20:39):
And they do have those hot.
I was talking to somebody lastweek, a 12% churn rate.
And I was like, okay, you'vegot to focus on that.
And they were completelyfocused on acquisition.
I'm like, all you have to do,all you have to do is just
extend by a couple months.
Look at what that is.
We ran the numbers.
We ran them right there on thecall.
(20:59):
And they're like, oh mygoodness.
And I'm like, you are leavingthis on the table.
This money is walking out thedoor.
Right.
What why would you not focushere as a business owner?
Jeremy Shapiro (21:10):
The interesting thing too is, you know, when we
look at customer acquisitioncosts and the scalability, one
of the things we often find iswithin a given channel, as you
try and scale that up, youencounter diminishing returns,
right?
That's right.
Um, you know, I've seen thisall the time.
You might be spending, youknow, $20,000 on your ad words
per month and getting a four toone return, right?
(21:30):
For each dollar out, you get $4back in.
Right.
You go to $30,000 in ad spend,and that now goes to three to
one, right?
You go to $40,000 in ad spend,you go to two to one, right?
So your ROI starts to shrink asyou saturate a channel.
Right.
So the solution isn't to growthalways just scaling up a given
channel, right?
Sometimes we've got to look atreducing that back end churn.
(21:53):
Other times, though, there's avery different approach, which I
love, which is uh, and this isa common strategy from the
playbook we talk about, issimply looking at our prices.
Very often as business owners,we set our price and we don't
think to go back and reevaluatefrom time to time, especially in
service-based businesses whereyou've placed a market value on
(22:14):
you and your time and what it isyour company provides.
Yes.
Inflation comes along, right?
Business comes along, yourcalendar gets full, but we have
a perceived notion of what ourtime or what our service or
product is worth.
Right.
Uh there was a business owner Iwas working with.
Um, she had established a newbusiness as a solopreneur and
(22:35):
had scaled pretty quickly to asix-figure business on her own.
And someone had reached out toher and asked her, like, hey,
could could you teach us yourbusiness model?
We want to start the samebusiness you're doing.
Um, can you show us how to dothat?
And so this client of mine hadsaid to me, Well, you know, I'm
trying to figure out what tocharge them.
And so I was thinking, like,you know, maybe a thousand
(22:55):
bucks, uh, I could teach themthe whole business model, but
I've got to cover the cost of myflights in the hotel and meals,
so maybe a little more thanthat.
And she was thinking about likewhat her time was worth on an
hourly basis to go out and teachthe whole business model for a
day.
And I'm looking at this saying,hold on, you're gonna teach
someone all the lessons you'velearned to launch their
(23:15):
six-figure business.
You're charging them a thousandbucks.
And you're trying to figure outhow you're gonna cover the cost
of your flights and hotels withthat.
I'm like, hold on.
Like, they should be coveringall your travel expenses, right?
This is easily a five-figure orhigher engagement because
you're giving them a businessand a box that they can go just
launch or run on their own as anowner-operator small business,
(23:35):
part-time, right?
Yes.
And so we simply added a zero,right?
And that, and that which iswhere I got the nickname, you
know, Jeremy at a zero Shapiro,um, from that conversation.
Because like that isuncomfortable for some service
providers to think about puttinga zero on the end of their
pricing, right?
Yes.
And so the most difficult partwas not just accepting the idea
(23:57):
that, you know, you don't haveto go um with a time-based
value, you can go with avalue-based pricing model,
right?
So swallowing that pill ofothers telling you, no, no, no,
you're worth it.
And here's the value you'redelivering.
That was, you know, obstaclenumber one.
The second was she had topresent that price, right?
And so we we said, like, look,you say it in front of the
(24:20):
mirror, right?
You get comfortable saying it,as silly as it sounds.
And wouldn't you know shepresented the opportunity uh to
this prospect uh of afive-figure engagement to come
out and teach this.
And they said, Yeah, thatsounds good, right?
Which which should tell youlike it probably could have gone
even higher, right?
But at least she got over thathump to present that price.
So very often we see simplytweaking a price on the front
(24:43):
end can make a big difference inbusiness.
And if you've got a continuitybusiness, this is really
interesting because this isrecurring revenue.
So let's say, for example, youhave a $50 a month subscription
service, right?
And your profit margin is $10.
So if we were to increase yourpricing to $60, it's a modest
(25:04):
price increase.
It's not the end of the world,right?
And we're not saying go changethis on all your existing
customers.
You can simply A B test yourlanding page, one with the
normal pricing that you'veestablished and one with with an
experimental price.
And we can look at yourconversions.
Well, wouldn't you know ifyou're able to bring a customer
in at 60 versus 50, your profitmargin just went your profit
(25:26):
went from 10 to 20.
So a modest price increase just2x your profit.
You could technically afford toconvert at 50% of what you were
previously doing and still makethe same profit.
Right?
And the reality is that'srarely the case, right?
Typically, you don't see anychange in your conversion or
(25:46):
even uh, you know, sometimeseven a lift, right?
But even with a smallreduction, you've now still
doubled your profit on everysingle customer coming in.
So sometimes experimenting,even just with what our pricing
is, can yield really big gainsright out the door.
Dr. William Attaway (26:00):
How often do you think people should
evaluate their pricing model?
Jeremy Shapiro (26:04):
Yeah, it's a good question.
It depends, right?
I'm a huge fan of value-basedpricing.
So for our listeners to havelike a commodity widget where
you're just one of a millionsellers on Amazon selling stuff,
well, that's prettychallenging, right?
You want to find a way to getinto more of a what's called
like a blue ocean versus a redocean.
If you haven't read that book,you know, that's a good book to
read.
You don't want to be perceiveduh as just a commodity in a
(26:27):
competitive market.
You want your ideal customer tosee you as the solution who
gets them, right?
When you are the only optionwithin whatever niche you've
created, you have a lot moreflexibility on testing your
pricing and figuring out wherethat should be.
And when we're able to go witha value-based pricing where
(26:47):
someone can think about thereturn on investment of what
they spend with you, and thevalue is still multiples higher
than what you're charging,you're in a great place.
Right?
So um, it's something good tolook at at the very minimum,
like once a year.
But, you know, two to fourtimes a year to check your
pricing is not a bad thing,right?
(27:08):
Um, we talk about uh in thebook, I talk about funnels,
right?
Um we all have a funnel in ourbusiness.
It might be that you have aclick on an ad or a search
engine listing to your website.
From your website, you thenhave an opt-in.
From an opt-in, you have anemail confirmation or a call
schedule or a purchase orwhatever, right?
You have these steps in yourfunnel to when someone becomes a
(27:29):
customer.
And we like to look at theconversion rates at each step of
those funnels and then whatlittle tweaks we can make to
improve the conversions.
And here's somethinginteresting about improving the
conversions on our funnel.
If at any point you have a 100%conversion rate, there actually
might be a problem there,right?
There's something, there'ssomething about having a funnel
(27:50):
that's too effective that isindicative of a problem.
Right.
So if, for example, um everyone of your prospects who you
present the price to buyswithout question, that is a
really good signal that yourpricing is probably too low.
Right.
Um we had a we had a customerwe're working with, they had had
a services-based business, andthis was a really interesting
(28:12):
and wonderful problem, is totake on new clients, there's
typically a multi-month waitingperiod.
So someone would say, Yes, wewant to work with you, and
they'd say, Great, we can bookyou two, three months out.
So one of the things we talkedabout doing, obviously, one is
scaling operations, right, to beable to handle more customers,
right?
But the second was the idea ofputting an expedite fee in to
(28:33):
say to customers, like, youknow, because these are five to
six figure engagements, right?
Right.
So these are customers who arealready spending some good
money.
So we put the idea out there ofhaving um an expedite fee so
customers could essentially buytheir way to the front of the
line, right?
We've all seen this, whetherit's a rush shipping fee or
paying for overnight shipping orwhatever.
We're used to the idea of youcan buy your way to faster
(28:56):
service.
So they put the expedite fee inplace, and a funny thing
happened.
Every single client theyoffered that to said yes and
bought the expedite fee.
Which tells us a few things,right?
Like one, we should have beenoffering this, you know,
earlier.
Um, two, they weren't chargingnearly enough, right?
Because if everyone's sayingyes to it, well, then we've got
(29:17):
to raise that price point whilewe again concurrently, you know,
increase the fulfillment sideeffects, right?
So we raise the price becausewhat we want is that some say
yes to an expedite fee, but notall, right?
So the 100% conversion actuallytells us there's a problem.
And so you raise it to thepoint that not everyone takes
you up on it.
We've seen this like at DisneyWorld and stuff, right, as well,
(29:40):
right?
If everyone takes the fast laneor everyone buys the priority
or whatever it is, then we havea problem.
Right.
If everyone buys the firstclass ticket, the first class
ticket wasn't charged highenough on the flight, and so on
and so on.
So that's good.
Looking at the 100% conversionmight tell you you have an
opportunity there to bring thatpricing up.
Dr. William Attaway (29:58):
Jeremy, every time we talk, uh Walk away
learning something.
And today has been no exceptionto that.
This book is phenomenal.
Cannot recommend it highlyenough to our listeners.
We're going to have a link inthe show notes so you can get
your hands on a copy.
I really encourage you to dothat.
And as one who bought theKindle first, I'm just going to
tell you get the paper becauseyou're going to want to make
(30:19):
some notes.
You're going to want to do somehighlighting, underlining.
This is going to be one yourefer back to.
Jeremy, thank you for sharingso generously today about this.
For writing the book in thefirst place.
If people want to get in touchwith you and learn more about
what you're doing and continueto learn straight from you,
what's the best way for them todo that?
Jeremy Shapiro (30:40):
Yeah, so at your businessgrowthplaybook.com,
you'll be able to find out moreabout the book there, the links
to buy a copy of the book, uh,socials, follow-ups, all that.
Um, I've also got um reallygreat resources for folks who
are interested in uh getting asample of what the book is, as
well as um, you know, I haveupdates around the content from
the book that I send out almostdaily um to all the folks that
(31:02):
are on our list.
These, by the way, are folksjust like you, business owners,
who want to get back to growthor, you know, see even more
growth in the business they'vegot.
So all that and more you canfind over at your businessgrowth
playbook.com.
Dr. William Attaway (31:13):
We'll put that in the show notes as well.
Thanks for inviting me on.
This is fun as always.
Thanks so much for coming backon.
Listeners, I think you see whyI invited him back.
So much value today.
So grateful.
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