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Unprepared Ep 29 - Focusing on The Right Products And Margins with Jaryd Krause

    Timestamps:

    [00:00] - Intro
    [01:29] - What products should you focus on?
    [05:05] - Invest your time on what's winning
    [06:06] - The goal of a business
    [09:05] - Where to find Jaryd
    [09:40] - Sponsor - Rewind

    Resources: 

    Key Points:

    • Buying online businesses helps people buy website businesses that are past 90% failure rate. 
    • Buying online businesses work with something that's already working and not recreating the wheel.
    • Buying online businesses help people buy businesses that have finally found their product market fit.
    • It can take a lot of time and money to know what product, business model, ads, and marketing funnel is going to work. That all comes in when you buy a business. 
    • Clients want to sell more products and do too many things. But when you start doing more, you're taking away what's actually working.
    • When buying a website or starting one out, focus on the best 1-3 products max then put them on a homepage. You can really work on those singular funnels.
    • Selling the most popular products works better than a range of different products. 
    • Stick to those 1-3 popular products you see what's selling, the high profit margin products, and the most popular products.
    • The most popular products can also have high margins which makes them easier to sell.
    • Once you know why people want those products and the message for that particular product, you can transfer that into your marketing funnel. 
    • There’s no need to create thousands of ads for thousands of products. Creating 1-3 ads that can be tested and improved over time narrows your focus on what's working best.
    • If you have a high SKU count business, don't think that you can't succeed. There are business models where it makes sense to have a high SKU count.
    • When you have lots of product variation, it’s hard to create a funnel, ads, and a winning system along with solving the pain points of your customers. 
    • With a simple approach, the winning strategy is narrowing your products based on what’s popular and what’s not.
    • Invest your time in what’s winning. It's gonna compound make you more money in the long run. 
    • The people and the business that gives the most value in life end up getting the most value back and end up winning. 
    • If one person can be helped with their problem with the one product they need right now, it's so much easier to keep them within the business ecosystem. 
    • Focus on selling one important product/service, then get the funnel down, hone it, and keep testing since you can always optimize the funnel.
    • If someone has already bought from you, they will trust your business enough and are more likely to buy from you again.
    • Other profit margins can be made by selling them onwards and making the products attractive to your customers by offering value.
    • Stacking up value will benefit both the customer and the business. 
    • Ecommerce businesses can spread quite thin on a single layer to sell multiple products. Without putting the products in a logical line for our customer journey with a goal of adding value to them, it will be harder for the business to scale and grow. 

    Transcript:

    Chase Clymer  

    All right, everybody. Welcome back to another episode of Unprepared. Today's episode is going to be amazing. We've got Jaryd joining us, he was also on the podcast. You should check out that episode. But I'm gonna stop talking, Jaryd. I told you 10 seconds, I meant 15.

    Jaryd Krause  

    Cool. Well, I'm Josh brown from buying online businesses, we've got a short timeframe here to cover so much. 

    What I do is I help people buy website businesses that are past the 90% value, right.

    And, you know, have a proven track record of making money every single month, and I'm all about, you know, working with something that's already working but not recreating the wheel. 

    And I guess that's what we're going to talk about in this in our little section here. Especially with e commerce businesses, right?

    Chase Clymer  

    Yeah, I like what you said there in the past that 90% failure rate. And I guess I need to start using that, in my vernacular, when I'm talking about product market fit, because everybody wants to get into ads before they have product market fit. 

    And where you're helping people is purchasing businesses that have finally found their product market fit already.

    Jaryd Krause  

    Yeah, that's right. And people that like that don't have to go out and find it, like it can take so long to like, and a lot of time, a lot of money to work out what product is working, what business models are gonna work, how to get it all dialed in how to get your ads. 

    And you're even your marketing funnel and take years to get dialed in. Whereas when you bought a business that will come with the business, and that's what I really love about it.

    Chase Clymer  

    Awesome. So today we're going to talk about focusing on the right products and focusing on your margin. So I guess, take it away and let us know what product we should be focusing on? And how should we kind of think about this?

    Jaryd Krause  

    Yeah, so when my clients buy businesses, we sit down and we go out, what are we going to do to work on the business. And traditionally, people that I don't work with or don't have a mentor and don't really focus on something as I tried to do everything. 

    And they just feel like, I know, this is quite common that people when they join my community to, for me to teach them how to buy a business is they say, my goal is to buy business, and say it's an Ecommerce site is to put, you know, to make more money to grow it, they want to put more products, they want to sell more products on the site. 

    And for me, what I like to explain to them is that when you start doing more than you take away from what's actually working, and you try to do too many things, and you can end up chasing your tail too much. 

    So instead, what I like to teach people is that when you do first buy your site, or even if you're starting one out, is instead of trying to get you know, 25 to 50 or 100 products, the silo on your site, is if you just focus on the best two products, one to two, maybe three Max, then you can put them on the homepage, you can really work on just those singular funnels, right? 

    And make sure that there that you're selling the most popular products, rather than a range of different products.

    Now I've seen businesses that have Bissau with like 16,000 sk use, and I tell my clients like look, you can buy something like that, but you won't be selling 16,000 sk use when you work with me, we're going to be selling maybe the best two to three. 

    So sometimes people will start a business and they see what you know, throw whatever there is onto the wall and see what sticks. When you've when you're in a few months. And you're seeing you know what's selling and you're seeing what are the higher profit margin products and the most popular ones.

    I would tend to stick with the most popular ones and focus on those 123 most popular products, they can also have a higher margin. And because they're popular, they're going to be easier to sell. 

    And then when you come down to getting the H 123 of those products that sell pages on point, you know exactly why people want that you know the message for that particular product, then you can transfer that into your marketing funnel. 

    So you don't have to have 7000 ads, the 7000 different products you can just have 123 ads that you keep testing and trawling and making better and better over time. 

    And it just narrows your focus on what's working best rather than having to try and spin too many plates and I feel that's the biggest you know, weakness of entrepreneurs is that we just got the shiny object syndrome we're trying to go and chase many things.

    Chase Clymer  

    I'm guilty, I'm guilty. I'm a to like

    Jaryd Krause  

    Yeah, I went into my first business. I was like cool, I'm making X amount per month. If I want to make triple that I need to buy three of those businesses. 

    However, I look back now and how silly is that? I just took a let's let's like took all of my time from one business to a third of each business.

    And even if he is Business justice. And we do that same thing with our products. So does that make sense?

    Chase Clymer  

    It makes sense to me. And it's something. Okay, so first of all, if you have a high skew count business don't think that we're saying that you can't succeed. That's not what we're saying there are business models where it makes sense to have a high skew count. 

    Because for a perfect example, be like shoes, maybe you got like a couple dozen styles, but your skew counts gonna be out of the control, because you've got a bunch of different things. 

    So what we're really talking about here is just, when you have a lot of variance in your products, it's hard to create a, there's no such thing as a perfect funnel, but it's hard to create a funnel and advertising, you know, winning system with email, and ads and SMS and what have you.

    When you've got, you know, so many products to deal with so much different variation to the language of what you're talking about the pain points that it's solving, when you start talking about a more simple approach, which ones are winning at 515 rule. it would be what we're talking about here.

    When you talk about the ones that are winning, and you invest your time there, it's just gonna, it's gonna compound and it's gonna just make you more money in the long run.

    Jaryd Krause  

    Yeah, and the goal of the business, I feel is, you know, the, and I say this to people personally, as well, the people and the businesses that give the most value in life, end up getting the most value back and end up winning. 

    And we don't need to give 5000 pieces of value to every single different person, if we can help one person with their one problem with the one problem I need, right now.

    Once we have them as customers, it's so much easier to keep them in our, you know, within our business round within our ecosystem.

    And what I'm talking about is upsells and down cells. So say I'm selling a certain product, right, and maybe I'm selling guitars on my site.

    I'm not trying to sell people a cape, like a cape bow individually, and a guitar pick and a guitar tuner in a bag and all that sort of stuff different like you know, straightaway, first they need to buy the guitar. 

    So what I'm and that's probably my higher profit margin, it's probably going to be the easiest, easiest product to sell, rather than a guitar bag, right, or a guitar tuner. So what I'd like to focus on is selling that, getting that funnel down. 

    And like you said, There is no such thing as a perfect funnel, because you can always better it, you can always optimize it, but getting that funnel really, really good and tune and hone and always keep testing, like you're saying is a great way to go for that guitar. 

    But then, where a lot of the other profit margin can be made is, you know, selling them onwards to hey, if you just bought this guitar, you may need a bag or a guitar tuner or a couple of peaks, whatever it is, because some of that's already bought from you, they have already gone and stood the time and the distance of gaining your trust enough to buy from you. So that's already there. 

    So they're more likely to buy from you again and and pick up a bag for maybe 20% off you to make it look attractive, right and then you know, bundle up a whole package for them and that's where your business really starts to thrive.

    Because you're not just trying to sell people meaningless products that they may not use, you're stacking and adding so much value not just for that for them but the business as well it grows exponentially just through those things.

    And I feel that we can spread you know a spread quite thin on a single layer of e commerce businesses and just try sell all these multiple different products but if we don't put them in a line a logical line for our customer journey, which our goal is to actually add value to them we find it so much harder for the business to scale and grow.

    Chase Clymer  

    Yeah, no, that's that's fantastic. So you're a community and you have a course before we go here if people like what you're talking about or maybe they are interested in buying an online business, here's your time to shine and let him know how to find you.

    Jaryd Krause  

    Thanks for the opportunity man. So buying online businesses.com we just got our site updated which is really cool.

    Thanks for that thing. And so yeah, go to buying online business comm check out my podcasts on there.

    If you have any questions just reach out to me on my site as well or as Google buying online businesses. Or in my name, Jaryd Kraus and I should pop up somewhere.

    Chase Clymer  

    Awesome. Thanks so much for coming on the show today, Jaryd.

    Jaryd Krause  

    Thanks so much for having me, Chase. It was a blast.

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