What are the 2 Types of Expert Business?

What are the two types of Expert business?

I often see people who are building companies, saddling themselves with loads of unnecessary capital OR debt, when they could be building their business in a far more capital-efficient manner by starting with an Expert Business.

What is an Information Product Business?

An information product business is simply a business where you take your knowledge or information that’s in your head and rather than turning up and delivering it to somebody in person you take that and package it into a product.  examples of these types of products can be brd 0 files video courses ebooks membership sites these are the primary information products that you can sell as an information product entrepreneur. 

And that’s really all there is to it!  Sounds simple, right? And it kind of is. The key to it is producing high-quality content and doing that consistently to attract the right people into your business and making sure that you’re solving a high-value pain for a high-value problem, that enough people are willing to pay you for.

There’s a couple of criteria that you really need to be aware of and those are:

  • you’re building something that you are interested in and selling information about something that you know about, that you care about

But, but, but, but, (gratuitous use of the word buuttt),  you have to make sure that the audience that you are targeting is both:

  • Willing… AND
  • Able…

…to pay you money for the information that you have.
You want to have an irrationally passionate audience. That is key.

So the first type of information business is one that is where you are purely selling information packaged into products.
There are no physical goods.
There’s no e-commerce. There’s no software. There is no merchandise. You have no inventory. Your inventory is essentially infinite – after you’ve gone to the trouble of creating your product – because it is all digital.

I personally love these types of businesses for that very reason.
If, as I’m sure some of you have done, read the 4-hour work week by Tim Ferriss then you’ll know that he started, and built, and then eventually sold, a supplement business.
However in the section where he’s talking about building and a muse business he says that he would highly recommend building an information product business because there are fewer FAQs and it’s just an easier business all round.

 

What is the 2nd type of Expert Business or Info Product Business?

Now the second type of expert business, I think, is particularly genius.
This is where you are someone who has a product or a service that is high-ticket or recurring (or simply NOT an info product business) – for example a software-as-a-service (SaaS) business or consulting company.

Clickfunnels is a brilliant example of a company that does this. It’s a software-as-a-service company. They charge $97 per month for their lower tier software product (which is amazing by the way).

 

 

What they have done is create information products around their software and that information educates people in how to become better and growing their businesses.
They also just say “oh, by the way you can use this software that we built, which also helps you grow your company” whilst they train you to become better at marketing your business.

The genius aspect of this is that you can essentially sell a low price ticket front-end offer to bring people into your ecosystem, into your world and they will pay you to become a customer. You have a NEGATIVE customer acquisition cost.

I know that clickfunnels is one example is a company that has had venture capitalists try to throw them money to help grow their business, but clickfunnels has turned around to VCs and said “wait a minute, why do we need your money? We actually get paid to acquire customers.” This type of Expert business means that it does not cost you to acquire new customers.

That, my friend, is why the second type of expert business, this second type of information product business is a genius component to add to any type of business that you’re building. What happens is that by selling someone a low ticket product, you educate them.

  • it simplifies your sales process
  • price resistance disappears especially when you position yourself as an expert and
  • you can essentially generate an unlimited number of free customers.

There’s a saying that goes: “The person who can spend the most to acquire a new customer, wins.”
I actually like the saying that goes: “The person who educates the market the most, wins.”

And that’s exactly what an expert business does. 

 

Can you blend the 2 types?

Just because you start a business as maybe a pure info product business there’s no reason why you can’t transition that into an info-product business as a wrapper around a separate business or separate product.

You could start out with the intention that that’s what you’re going to do (and I think that’s what clickfunnels actually did). Russell Brunson had a coaching company but he knew that he wanted to sell his software so he built a coaching company to generate cash so that they could bankroll the development of the software.

There’s nothing stopping you from doing this.
Yes some businesses are capital intensive and it’s prudent even essential to take on startup capital. But if push came to shove, maybe there’s a way that you could create a technology company in a really capital-efficient way by creating an information product business and wrapping that around the software. By doing this what you’re essentially doing is creating a value ladder.

There’s nothing new about this. Every company worth its salt out there does this. Even the big banks. Just think about it. They give you an account for free. Then they charge you an ongoing amount for an upsell – a business bank account or an overdraft or a credit card. Then they sell you high-ticket products, such as loans, mortgages, insurance products, more credit – you name it. This is their value ladder.

 

What’s a Value Ladder?

It wasn’t until I’ve read secrets when I first came across the concept of value ladder and it really is intuitive and obvious when you stop and think about it.

A value ladder is exactly what it sounds like. You have a ladder with low price product offers at bottom and then you step up with a slightly higher price product and offer, and then up again and again and so on.
You can get very complex and extended Value ladders. When you’re just starting out think about simple 3-step value ladder.

You have a core offer and then either side of that going up the ladder you have a higher and higher price higher ticket offer. Then coming down the value ladder you have a lower-priced lower-ticket offer.

A great example of this is the simple expert and Coaching model where your core offer is perhaps a core coaching programme priced somewhere between 1000 dollars to maybe $5,000 (depending on the value that your offer is adding to somebody’s life or their business).

 

Then you really should start there. Start there and focus on that core step until you hit $1 million in revenue with that single offer. I obviously want to caveat this by saying it is all situation-dependent. If you’re starting a side-hustle then it can be difficult for you to start a coaching business alongside because of time constraints.

if you are like me, a “dad-preneur”, building a side-hustle on top of having a full-time job and doing the school run and so on, then really, your side-hustle needs to be something that can go straight to being a product or affiliate marketing – which is what this is.

Once you’ve bought yourself enough time – I mean to have time freedom where you can step outside of your full-time gig and have a cushion where you can support yourself or support yourself and your family – but turn your side-hustle into your full-time thing – only then does it make sense for you to focus on the centre and the core of your value ladder. (IMHO).

The ideal thing to do is to build and focus on that core offer of your value ladder first (if your situation permits). Then focus on the back-end, the higher-price – so if you’re selling a $1,000 offer, your back and might be $5,000 to $10,000 if that’s a done for you service.

Or if your core offer is that say a $5,000 coaching program, then your back-end offer might be a $10,000 to $50,000 to $100,000 consulting project.

Obviously it entirely depends on your skill-set and your market and your offer.

Received wisdom has it that once you have the core of your value ladder, and the back-end of your value ladder working together nicely and have generated you over $10million then, and only then, is it time for you to shift to creating front-end offers.

These are your information products.
These are your books your online courses.

You also want to create an ecosystem around the business which is free, like a blog like this one that you’re reading right now, your podcasts, your YouTube channel.

Obviously, when you get to this point, it makes sense for you to syndicate your content and I’ve actually created a course on how to do that, and how I have done that in my own business to leverage all of the content that I’m creating – in order to have maximum impact.

Go to this link here:

…then you can pick up that course for free, where I usually sell it for $297.
In that program, I’ll also show you how to build your exact systems for putting as much of that syndication process and content distribution process on autopilot as possible. You will also learn how to build a small crack team around you – all at minimal cost – so that you can create and dominate the content conversation online.

I hope that has helped you understand the two different types of information product business the two different types of expert business.

To recap; 1 is a pure information-product business that doesn’t involve your physical presence or your ongoing time to deliver your thing. The other is where you’re taking the same structure and you are simply putting it in front of, or around another business in order to indoctrinate your market and acquire customers for free.

If you’re interested in learning more about how clickfunnels did this, and how you could do it too, regardless of your current business or entrepreneurial situation, go here:

Big love,

Rich
x

Add a Comment

Your email address will not be published. Required fields are marked *