Build an Incredibly Effective Distribution Channel and Automate it

The Back Story

A while back, my wife and I decided to get rid of our Keurig coffee machine and get a French Press. We had read an article about how bad the K-Cup machines are and how the inner tubes develop a build-up over time. Yes you can clean them, but that’s the problem. You have to clean them. The other issue is that the K-Cups themselves are horrible for the environment. The number of these things that are consumed and thrown out each day is staggering.

We decided a French Press was a much better way to go. As it turns out, the coffee tastes much better too. We had no idea what we were missing out on, because we’d gotten so used to the K-Cup coffee, and how quickly you can make it.

Now, we either buy our coffee grinds from the supermarket or sometimes directly from Starbucks. Last Friday night, I was picking up our dinner at a place right next to a Starbucks. As I walked in and started scanning the place for the coffee, I noticed a “Thanksgiving Blend.” Normally I buy the same blend every time but I thought to myself, Why not? It is almost Thanksgiving, after all.

I took my new coffee up to the counter and asked them to grind it for a French Press. Saturday morning, my wife and I brewed our new blend. It was a dark roast. We’re used to something lighter, but we both agreed we liked it.

From Wall Street

Starbucks (SBUX), like every Wall St. company, has created a distribution channel. Starbucks has gained our trust. We like their products. Whether it’s their coffee, the lemon loaf, or the frappucino, we keep coming back, because we trust that we’re going to enjoy their products. So Starbucks has the ability to place new products in front of us, and be confident that we’ll try them, because we trust them.

Best Buy (BBY) is regaining people’s trust. They will now price match Amazon, or any other competitor. They aren’t stupid. They know that people will walk into a Best Buy location, to browse products, and then go online and buy those products on Amazon. With Best Buy price match, you can pay the same price, and now you don’t have to wait two days to get your new toy.

Amazon (AMZN) (wittingly or not) was hijacking Best Buy’s distribution channel. Now Best Buy is taking it back.

Wall Street companies set up distribution channels in the form of their brick and mortar stores. Then they use advertising to get us in there. After that, there is word of mouth and nowadays, of course, they use social media to get the message out.

Once they’ve got the “traffic” (you and I walking into their locations), they have an established distribution channel.

Once a company has an established distribution channel, they can present us with new products and we try them because we know, like, and trust these brands.

Even if I didn’t like the Thanksgiving blend, I would still go back to Starbucks. I just wouldn’t buy that blend anymore.

To Main Street

So what can we, as small (and especially remote) business owners learn from this? We need to build a distribution channel. We need traffic. We need a place where we can place products in front of an audience, and give them an opportunity to try them.

Social Media has Failed Us

You may be thinking, But what about social media? Isn’t that one of its uses? The truth is, social media has actually failed us in this capacity. Got a Facebook page? You have to pay for Facebook ads to be seen there. Twitter? No one sees your stuff on there, unless they deliberately look for you. Instagram doesn’t let you post links anywhere, except for one place in your profile, which people have to go out of their way to find.

Social media is NOT your Main Street distribution channel. Social media is where you go to build your distribution channel.

So what IS your Main Street small business distribution channel?

Your email List

This is your distribution channel. Social media is good for building your email list. You establish a relationship with people by showing them something of value. If I didn’t see something of value the first time I walked into Starbucks, I would never have come back. Something drew me in the first time. In my case, it was my friend Evan. I remember my first visit to a Starbucks. I remember the experience. It was warm, cozy, and I had good company.

This past week, I went from getting 15 new email subscribers per week to getting 12 in one day.

I promised some people in our Between Wall and Main Facebook group that I would explain how I did that, and now I will.

I need to back up. A year or so ago, I learned a simple system for how to grow your email list. You can automate the process. But first, you have to have something extremely valuable to offer. I thought long and hard about what I wanted to offer. I thought about my target market.

I wanted to offer something that would attract the people I wanted to serve most.

That meant a video about QuickBooks Online.

Now what is a business owner’s biggest pain point that I can help them address? A messy set of books.

I created what turned out to be a one-hour video on how to clean up (“audit”) your company books in QuickBooks Online. Now I had something to trade for email addresses.

My video is my target audience’s first experience with me. I had to make sure it was good. Warm and cozy. Fortunately I am pretty good at making videos. And my friends have told me that I’m warm and cozy by nature without having to work at it too hard.

Now I have something to trade. Something of real value. This video would easily be worth $500, and I am giving it away for free. Some people would call that just plain insane, but that’s the point. It has to seem insane. Trust me, it isn’t. It will get me well over that amount in business.

Now for the system.

Once you have the content to trade for emails, you make an offer. Give me your email address, and I’ll give you my video for free. It really isn’t free though, is it? The emails have value. They are my gateway to forming relationships with the people behind them.

Of course, we need an email management system. I use Mailchimp for this. I also use a WordPress plugin called Mailmunch. This makes it easy to create an email capture form on your website. It also allows you to create a pop-up to grab more email addresses when people visit your site.

With the above in place, we are ready for the automation part.

Facebook ads. I told you that social media was good for capturing email addresses, to build your distribution channel. This is how it works.

You create an ad (or boost a post) offering your “free” video. The first time I placed an ad for this about a year ago, I found that I was getting more signups organically so I stopped the ad. Last week, I tried it again and, in the first day, I got 12 signups. The week before it was 15 for the whole week.

There is an art to the advertising part. I can’t tell you why one thing worked well while the other thing didn’t. I have some ideas but they are just ideas. I don’t really care why. The thing is, I knew I had a solid offering. In the original ad, I was inviting people to get my free video on how to audit your company file.

In the ad I created this week, I simplified the language. Instead of “audit your books,” I said, “clean up your books.” I also found a new image. I’m not going to lie, my wife helped me select it. The image was perfect because it created a relatable picture of what it looks like when someone has a mess on their hands.

Here’s the ad on FacebookClean Up Your Books. By the way, feel free to signup and get the video 😉

It was a simple tweak on the wording. The words mean essentially the same thing. But the phrase “clean up your books” evidently resonates better with people. On day one, I got 12 signups. That was on Friday. We’ll see if it continues.

When you advertise on Facebook, you can also get those ads on Instagram, only now there is something people can click on.

Now we have an automated process. The Facebook ad grabs the traffic and gets people signed up for the newsletter. Mailchimp automatically sends out an email with the link to download my video.

I am building my distribution channel. I have people walking around in my “virtual store.” They read my emails and they stick around because each week I write an email, and I make sure to offer something of value. Not a product or service. Most weeks I am just sharing my experience.

Finally, I can occasionally share information about a product with people. It could be my own product or it could be someone else’s. Maybe I have an affiliate link I can use. If so, I can share a product I love with people, tell them why I love it, and use that affiliate link to generate a little extra income when people sign up. These things are never going to be enough to change my lifestyle but every little bit helps.

If you stick with a strategy like this, you can actually build a big enough list (distribution channel) that the amount of income you generate will become substantial. Mike Dillard has made well over $50 million this way. Whom do you think I learned this from?

Meanwhile this has other ways of generating income. That audit video has brought in a lot of business. I had one client in a 1:1 session remark that it was “A very clever way of engaging with [him].”

Once you find right formula and get the email signups to pop like I did, you may want to consider raising your spend. That will increase your reach. I start out with a budget of $100, and see how that does. In this case, since it did well on Friday, I need to see how that continues as we get into the new week. If the results are as good, I will double it to $200.

One sign-up, for one webinar, or one subscription that I have, will more than pay for the ad. Everything after that is profit. Increase the spend to increase the volume in your results.

As a byproduct to all of this, my follower counts on my Facebook page and Instagram are increasing. The more people who like my Facebook page and follow me on Instagram, the more people my ad reaches. The ad reaches people who “Like” my page, as well as their friends.

It’s a numbers game. Reach a million people, get 1,000 subscribers. These subscribers are not just random people. They are people who saw value in what you were offering and took a chance by giving you their email address. I know I don’t easily give that out. Once they see that you deliver the value as promised, they will not only stick around but they will tell others.

Wall Street companies build major distribution channels, that attract a ton of foot traffic, so they can sell their products and services. I’ve just given you the blueprint, for how you can do the equivalent thing in your small business.

The process requires creating content, and a number of tools that go both with, and into, the creation of that content. Visit www.NerdEnterprises.com if you’d like help with this!

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