Issue #2067
- WEALTHY: The "Anti-Enron" approach to investing (Andrew Gordon)
- HEALTHY: The REAL costs of artificially cheap foods (Jon Herring)
- WISE: Jeff Bezos on the "customer experience"
ALSO IN THIS ISSUE:
- What’s wrong with thinking of your customers as customers? (Bob Bly)
- The pros and cons of buying a vacation home (Michael Masterson)
- It’s Good to Know… about Norway’s automated customs system
- Add "expedient" to your vocabulary
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- Patrick Coffey
Enron’s Worst Lesson for Investors
By Andrew M. Gordon
Both corporate players and the average investor learned the wrong lessons from the Enron boys. Enron’s demise taught corporate execs not to stretch the envelope… not to invent new markets and then dominate them… not to try to reform heavily regulated sectors… and not to believe they’re the biggest, boldest, baddest company out there. Meanwhile, investors got the message that you should NEVER invest in a company you work for. Why? Because you may end up like all those Enron employees, not only stripped of your savings but – even worse – out of a job.
Unlikely. For one thing, companies cut back on jobs all the time, whereas Chapter 11s are relatively infrequent. Most employees who lose their jobs are from privately owned startups not listed on public exchanges. (I’ve been there.) Not only that, but if you’re fired from a public company outside of Chapter 11, your stock investment is still good. In fact, investors may reward the company for reducing its costs by buying more stock, driving the price up.
So, if you work for a public company and you love its growth prospects, invest in it. As much as 30 percent of your 401(k) or other company savings plan is fine. If knowledge and insight has anything to do with making sound investment decisions (and it does!), this is going to be your safest investment by far. You’ll probably know more about it than all your other stock investments combined.
This is just another way (and a very convenient one) to invest in what you know. You’d be foolish not to take full advantage of it.
[Ed. Note: Andrew Gordon, ETR's Investment Director, has authored several books on energy markets, global countertrade practices, and the hot growth sectors of China and Russia. A former professor of marketing and finance, he is the editor of INCOME, a monthly financial advisory service that uncovers income-generating stocks that promise safety (first and foremost), along with much-higher-than-average profit potential.]
"We see our customers as invited guests to a party, and we are the hosts. It’s our job every day to make every important aspect of the customer experience a little bit better."
Jeff Bezos
A Secret to Success in Practically Every Business on the Planet
By Bob Bly
Do you have an Internet business… or do you hope to have one some day soon?
In my experience, the most important factor determining your success as an Internet marketer… or in virtually any other business… is relationships. Specifically, the relationships you have with the people on your customer list – known in traditional direct marketing as your "house file."
There are four ways entrepreneurs can relate to their lists. The first three doom you to mediocrity and modest returns. The fourth can empower you to create an online business that delivers extraordinary value to your customers – and makes you rich in the process.
Level 1
At this, the lowest level of the seller/buyer relationship, you think of all the people on your list – those who have bought from you before as well as those who haven’t – as "prospects."
Technically, that’s correct. Anyone who has shown some interest in what you offer – either by buying from you or "opting in" to receive your e-mails – can be defined as a "prospect." But that is a poor way to think about the people on your list.
Why? Because a "prospect" is someone whose name and contact information you own, and from whom you hope to extract money by selling them a product or service. That’s a mercenary and self-centered view. It puts you and your profits – not your prospects and their problems – first.
Level 2
The next step up from viewing people on your list as prospects is to think of them as customers – either actual customers (who have purchased) or potential customers (who may make a purchase).
"Customers" is slightly better than "prospects." Customers are people who spend money with you, so you naturally value them more. On the other hand, you are still viewing them as "purchasing entities" – individuals from whom you can get money now and hope to get more money in the future.
The typical marketer constantly thinks of more ways to sell more products and services to more customers. In many ways, that’s a good thing. Unfortunately, it’s also an opportunistic way of looking at the people on your list that makes you care more about your own profits than about them.
Level 3
At this level, you consider the people on your list to be your clients.
While "customers" buy products, "clients" are people to whom you strive to deliver extraordinary service and value. As a result, you respect them more – and treat them better. They reciprocate with loyalty and an increased desire to acquire more of your products, services, help, and advice.
Level 4
The best relationship you can have with the people on your e-mail marketing list is to think of them as friends.
You deliver value and service to clients, but you do so for the money. Friends help friends not for the reward, but because they are friends.
When you think of the people on your list as your friends, your mindset becomes positive, helpful, and generous. You think, "What do my friends need? What can I do to make their lives better, make them happier?" And when you think that way, what follows is the creation of all sorts of useful, valuable, and innovative products and services they want and need.
Also, when you treat them as friends, they begin to think of YOU as a friend. Sales become more frequent, purchases become larger, and closing becomes easier.
Why? Because people like to buy from people they like – and when they become your friend, they like you.
How can you evolve your relationship with the people on your e-list from prospect to customer to client to friend? Here are a few suggestions:
- Care about them.
The best marketers are genuinely passionate about helping their readers improve their lives – and that passion comes across in every e-mail communication they send.
- Talk to them.
Write like you talk. Use a conversational, natural style. Your e-mails should sound like you are talking to a friend and telling him something important.
- Be a straight shooter.
Always tell your readers the unvarnished truth. Don’t sugarcoat or hold back. Only by being totally honest and open do you gain their trust and loyalty.
- Let your personality shine through.
Be the real you – warts and all. If you’re cranky, it’s okay to sound cranky in your e-mails to the people on your list. If you’re a tightwad, tell them you’re cheap.
- Give extraordinary value.
I sell information products online. But in many of my e-mails to the people on my list, I give away great content… right there in the e-mail. There is nothing for them to buy. The information is free.
Do these methods work?
My first year online, when I took very little action and viewed my subscribers as purchasing units from whom I desperately wanted to extract money, I made – even though I offered quality content for sale – $19,683.
Now, I view my subscribers as friends. I care about them. I let them into my mind and share what’s in my heart. I give them all I can. And my online sales are on track to reach $250,000 this year.
All because my relationship with my e-list moved – as yours should – from the lowest to the highest level, from the most mercenary to the noblest.
"We’re all benefactors," says Mark Cuban in an interview with Selling Power magazine. "To succeed, you not only need to be able to get along with people… those people also have to feel like they’re getting something out of the relationship."
[Ed. Note: Learn how to build your own Internet business at ETR's upcoming 5 Days in July Internet Conference. You'll walk in with nothing - no product, no marketing skills, no technical know-how - and you'll walk out with your own online business. If you even think you might be interested in this opportunity, you must sign-up for the Five Days in July Conference today.
Sign up for Bob Bly's e-zine, The Direct Response Letter.]
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Why Are the Bad Foods the Cheapest?
By Jon Herring
For most of history, the size of a man’s belly gave people a good idea of the size of his wallet, with the rich having plenty to eat and the poor going hungry. The belly/wallet correlation still exists, but in reverse. Net worth continues to be a reliable predictor of obesity, but now it’s the poor who are most likely to be overweight.
With this in mind, obesity researcher Adam Drewnowski went to the supermarket with a hypothetical dollar and a goal to purchase as many calories as possible with it. He found that his dollar could buy 1,200 calories of cookies or 875 calories of soda, but only 250 calories of carrots.
Why are whole, simple foods so much more expensive than food that is processed and packaged? As Michael Pollan, author of The Omnivore’s Dilemma, puts it in a comparison of Twinkies and carrots, "How can the supermarket sell synthetic cream-filled pseudocakes for less than a bunch of roots?"
The answer, unfortunately, is that our food prices are skewed because the U.S. government heavily subsidizes the corn, soybean, rice, and wheat crops that most processed foods are based on, while doing almost nothing to support the farmers who grow fresh produce.
The result is that the least-healthy calories in the grocery store are the cheapest by a mile. And while one branch of our government is helping to inflate the national waistline, another branch, the Department of Health, is gearing up to battle the "epidemic" of obesity.
Reader Feedback: "Thank you for the wonderful work you are doing."
"I do not go a single day without reading ETR. I find almost all the information contained in your newsletter to be quite useful, and I have been recommending it to others to help them develop their lives as well. Thank you for the wonderful work you are doing."
- Marlene Hewitt- Brooks
Kingston, Jamaica
Notes From Michael Masterson’s Blog: Should You Buy a Second Home Before You Retire?
"Retirement home sales are growing," The Wall Street Journal reported recently, boosted by purchases by young buyers who are still decades away from retirement. One example: Daniel Markle and Sandra Bauman, who spent 20 percent of their retirement savings to buy a cottage on a lake in upstate New York.
"It was clear the money was better off in the index funds we owned," Markle told The Journal, "but there are factors you can’t see on the spreadsheet – like the time we get with our kids building memories."
K and I waited to buy a second home until our two older boys were out of high school, but we sometimes wish we had done it many years ago. The great thing about a second home is that it can allow your children to grow up in two very separate environments: city and country, suburbs and city, mountains and seacoast, etc.
The challenge is justifying the expense. For the most part, a second home is a place that is unoccupied most of the time – which usually means it’s more expensive to own than staying at hotels. In some locations, it’s possible to rent out your second home to strangers, but the times you’re going to want to use it are going to be the times they’re going to want to rent it.
- Michael Masterson
[Ed. Note: To read more of Michael's unedited, uncensored (and sometimes unexpected) ruminations, check out his blog here.]
It’s Good to Know: Norway’s Automated Customs System
Thanks to recently installed automated tellers, passengers entering Norway through the country’s busiest airports can now declare their taxable goods and pay the duty automatically with a bank card instead of waiting in line for a customs officer. Norwegian officials say this new system will allow them to focus personnel on serious smuggling.
(Source: Reuters)
Your Personal Invitation to Join a Small Cadre Of “Freedom Fighters” In Our Nation’s Heartland This July!
Dear ETR Reader,
Coming this summer, Early to Rise presents a five day challenge for you, should you decide to accept it…
The stakes? Reclaiming your personal liberty… declaring your self-reliance… and seizing financial independence forever.
This July 10th to 14th, we’re going to take a small group of ETR readers and work alongside them to build your own Internet business – the whole shebang, from soup to nuts – in an intensive, 5-day, business-building program better than anything we’ve done before.
You’re going to walk in with nothing – no product, no marketing skills, no technical know-how – and you’ll walk out with your own online business.
What you will learn flat-out works. You will build a professional, popular, and profitable Internet business. When you walk out the door, you’ll be super-prepared for success in a way that very few entrepreneurs ever are, online or off.
ETR’s “Five Days in July” Internet Business-Building Workshop is going to deliver success. Actually, it will OVER deliver. And your success, of course, is the bottom line. Sound good?
Okay, then let’s get going… let’s build something that WORKS… your own, REAL Internet business.
It only takes a few minutes to take that first key step. Find out how easy it is to join us and get all the details here.
Looking forward to seeing you there,
- Patrick Coffey
Word to the Wise: Expedient
An "expedient" (ik-SPEE-dee-unt) – from the Latin for "to make ready" – is something contrived or used to meet an urgent need.
Example (as used by Theodore Roosevelt in a 1918 article for The Atlantic): "If, when assailed by the ostrich, the man stands erect, he is in great danger. But by the simple expedient of lying down, he escapes all danger. In such case, the bird may step on him, or sit on him; his clothes will be rumpled and his feelings injured; but he will suffer no bodily harm. I know various men… who have had this experience."
[Ed. Note: Become a more persuasive writer and speaker ... build your self-confidence and intellect ... increase your attractiveness to others ... just by spending 10 VERY enjoyable minutes a day with ETR's new Words to the Wise CD Library.]
Michael Masterson
Copyright ETR, LLC, 2007
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