I just had an interesting conversation with my Uber Driver…
And it has to do with crafting an offer, risk reversal, and demonstrable proof.
Table of Contents
Here’s the background:
I’m in San Diego for the holidays, and my family is staying at an AirBNB by the beach.
The AirBNB is in a killer location and has great views…
But it’s fairly small…
And it’s not the kind of place where I’m able to get work done – especially with a two-year-old running around.
So, rather than be stressed about that, I decided to just rent out a day office at a nearby Regus for the week…
And then to Uber back and forth to the Regus whenever I want to get work done – that way I don’t leave Laura and Eden without a car.
So this morning I went over to the Regus to get some stuff done and do our weekly Copy Accelerator Training Call…
Then, at about noon, I called an Uber to take me back to our Air BNB.
When I got in the Uber, I saw that the driver was an older man with a big long beard…
And he was using his car’s Bluetooth to conduct a call, which at first, kind of annoyed me.
Soon though, I went from being annoyed to being very curious…
Because it was apparent that the man was talking to a business partner…
And that the business was NOT going well.
At one point, my Uber Driver’s partner said something to the extent of: “It’s just hard to get people to give you a thousand dollars. You know, with the economy and uncertainty and all of that.”
Well, now my curiosity was really piqued for two reasons…
First of all, I wanted to know what they were selling for $1,000…
And second, I had an immediate guttural instinct that they were wrong…
Because in my experience, it’s actually pretty easy to get someone to give you $1,000…
Provided you are presenting them with the right offer…
And they are actually a qualified prospect.
So anyways, after a few minutes my Uber driver ended his call…
The first words out of my mouth were, “so, what are you guys selling?”
The Uber driver then proceeded to answer my question…
And here’s the really dumbed down paraphrase:
They found these sand fields in Mexico that are very rich in gold. They have a contract on the fields, and they have a technology that can extract gold from the sand. According to the driver, he thinks the sand fields could reasonably produce about $30,000,000 worth of gold per year.
The problem is that they need to get their extraction equipment down to Mexico and set it up…
And the cost to do that is roughly $400,000, which is money they don’t have.
The driver then proceeded to explain the extraction technology to me, and it sounded interesting and possibly legitimate…
And he also said that they’ve done tons of tests with this technology and have proven without a shadow of a doubt that the technology really does work.
So, their big problem, he told me, is that they don’t have the money to get the equipment to Mexico.
That’s where the $1,000 comes in.
They’ve created an offer where people give them $1,000 today, and they’ll send them an ounce of gold in six months.
The current price of gold is about $1,500…
So in theory, the return is pretty good.
But of course, there are big problems too…
Namely that nobody seems all that excited to give up $1,000 today for the promise of $1,500 at some point in the future (and that’s only if the price of gold holds, or goes up. If the price goes down it’s an even shittier investment).
Honestly, I don’t blame people for feeling that way either…
It feels risky, right?
That’s what I told the Uber driver too.
I explained that their biggest problem is this risk…
Or, to be even more blunt, I said:
“Your biggest obstacle to overcome is the fear that if I give you $1,000 today, I’ll never get it back.”
That’s the real fear.
It’s not even that I won’t get an ROI on my $1,000…
I can live with that…
But what I can’t live with…
Is realizing I’m a dumb sucker who gave some company $1,000 and they just disappeared into the night with it…
And now all of my friends, family, and neighbors are all laughing at me and calling me a fool.
That’s the real sales-killer right there…
And this fear is pretty universal.
It’s the same fear that keeps people from buying pretty much anything we sell online…
Which is why one of our most important objectives for any sales funnels or sales letter…
Should be to establish credibility and trust with our prospects…
And to make them feel comfortable and secure.
That’s SO HUGE.
—
Now, I’m not entirely sure how the gold guys are going to do this…
But I do know that they have an uphill battle ahead of them…
Especially since they don’t seem particularly savvy when it comes to marketing.
Here are some thoughts on what they can do, though:
- I’d set up a website for their organization and go through massive pains to make it look as credible as possible. This would include detailed bios of every member of their team, demo videos of their technology, a video of the sand fields in Mexico, third-party quotes about their expertise and acumen in this area, videos of other geologists and mineralogists talking about how credible their plan is, etc.
- I’d then run direct mail and digital campaigns that drive people to the website. They could also try selling via Direct Mail alone, but I think in this case the website is super necessary. Why? I think people need to watch their technology in action, see the sand fields “in person,” etc. Their prospects need to be able to convince themselves that this really does make sense, and that the upside really could be huge.
And, speaking of the upside… that’s their other really big problem…
Let’s be honest – there’s a decent chance that even if these guys had the $400k, things wouldn’t go the way they’re planning. Instead, something will blow up or go wrong and they’ll probably need more money. Or, maybe they’ll lose access to the sand fields – who knows.
There’s just so much RISK…
And asking their prospect to assume all of that risk… for the upside of $500 per ounce… just doesn’t work.
If they followed steps one and two from above, yes they’d be closer to actually getting some investors…
But the risk is just still so high.
I think they need to change the offer.
Right now, they're trying to use a novel funding mechanism that lets them retain 99% of the upside (they get $30MM worth of gold per year. The investor gets $600 one time)…
While risking none of the downside.
This strategy probably sounded good on paper when they drew it up – but it’s not working.
So, at this point…
I think the guys probably need to change gears…
By giving away more of the upside.
It’s the whole “I’d rather have 50% of $30MM a year than 99% of $0 thing” ya know?
These guys need to start selling a stake in their actual operation.
Because if they did that…
And, assuming everything else the guy told me is actually true (the technology really works, there really is gold in the sand, they really do have a contract on that sand, there’s no big surprises)…
Then realistically, they’d have ZERO problem attracting speculative investors…
Especially when $400,000 is really not big amount to risk for a potential 9-figure upside.
But that’s just the point, isn’t it?
See, as it stands now, the risk-to-reward ratio isn’t there…
But, if they changed their offer…
And actually gave away a stake in their operations…
Suddenly, it would be…
And they could have a lot of success.
Now again, I have no idea if anything the Uber driver told me was legit or not…
But I did think it was a fun thought-experiment to play with…
And hence, my post.
Hopefully you guys find this stuff interesting too.
– SPG
P.S. This post originally came from an email I sent to my private list. If you want to see more stuff like this from me, you can apply to join my list using this link.
