Hey, it's Mark Butler and you are listening to a podcast for coaches. Now, a few years ago, there was a podcast called the Mark Butler show that I produced something like 60, 60 something episodes. And I don't even think it's online anymore. I think I migrated it. I think some of it was lost. I mean, this is all very classic, very typical of me to produce 63 episodes of a podcast and then sort of lose them.
But in 2017. One of the episodes that I published was called why I hate the launch based product marketing model, something like that. That was almost seven years ago. And as I sit down to record today, I think to myself, well, at least I'm consistent because this morning I was writing, okay. Here's what's really going on. I'm writing a book now. Why am I telling you that I'm writing a book in order to trap myself into continuing with it?
That's the reason I'm telling you that I'm writing a book. the working approach right now is that every day I require myself to write about 1200 words of whatever I just have to get to 1200 words. It has to relate to coaching. My philosophy of the business of coaching and the craft of coaching 1200 words stored in a folder, move on with my life.
My confidence being that in the next few months I'll have 50, words in a folder and then I can go back in there maybe with help and turn that into a book. I'm saying that here because I'm trying to trap myself. So anyway, today's free writing exercise was called the underlying mechanisms that cause the launch based business model to ruin lives. Now look. That's not what this episode is called because that's dramatic and it's hyperbolic and it's not fair and it's not true and it's not accurate.
It's just me sitting down at my desk at eight o'clock in the morning and trying to get to my 1200 words and just writing down what comes most naturally to me. But at the very least, we know that in 2017, I wasn't excited about the launch based model and in 2024, I'm still not excited about the launch based model. Business model, but at the very least, I think in 2024, I'm prepared to be a little bit more balanced and reasonable about it. I don't think it actually ruins lives.
At least it doesn't ruin all lives. It just ruins some. In fact, the other day I was talking to a client and I was telling her that my favorite joke is When people ask me what I do for a living, I say, I comfort life coaches whose most recent launch underperformed relative to their goals and expectations. That's my whole job. What else do you do? Nothing really. I just comfort coaches whose launches underperform.
She laughed because she recently had a launch that felt like her hardest launch ever. And our conversation sparked this episode. So I will admit my bias upfront. Of course, I don't love the launch based model. It's not clear to me how it benefits anyone in the equation, either on the seller side or on the buyer side. But as I've tried to work with it, as I've tried to come to a new perspective on it, I hope to be more balanced. A couple of weeks ago, I published an episode.
About how to read a sales page and a compliment came in that meant a lot to me from a trusted listener. And the person said, I appreciated the episode. I thought it was very balanced. That meant something to me because I do have a great capacity for snark and sarcasm and cynicism. And that's not my favorite version of myself. My favorite version of myself is someone who can say, I see this thing from all angles. I have a special perspective on it based on my experience. I do have an opinion.
I have a position, but I'm not just yelling to yell. I'm not just being snarky for clicks. So let's talk about the launch based business model and let's talk about what I think underpins that model and why I think it tends to do in the long run more harm than good. To the person who uses it in her business for background, I've got to give you a little bit of a hypothetical. This is the hypothetical. A coach starts her practice.
And I know I always say her, it's because most of my clients are women and most coaches are women. It's just a shortcut. We'll live. Okay. So she starts her business and she starts to publish content. And her content finds some amount of resonance. She has a way of talking about the problem and the solution in a way that people are attracted to. They continue to tune in and maybe they even share her work. So her audience starts to grow.
Now, initially her business model will probably be something not quote unquote scalable. It will probably be one on one coaching. Maybe it will be very small groups. Maybe it will be the occasional retreat, but for the most part, it's not something where she needs a whole bunch of people to take a specific action at a specific time. She needs one or a few people to take a specific action occasionally.
So there's this very smooth Effect in her business where she's consistently signing new clients and maybe there's dips where she doesn't sign any clients and then maybe there are seasons where she has a lot of clients signing up at the same time, but there isn't really an offer in her business where she has to capture a bunch of yeses in a tight time window. And what's happening in this whole season is as she continues to publish content.
And as that content continues to find resonance, the audience grows. And so does the demand that's built into that audience. I call it latent demand or pent up demand where the people in the audience are having an increasing desire over time to engage with her in another way. Now, one of the biggest things in play here, and again, this is just my hypothesis, is the principle of reciprocity.
If you read a book called Influence by Robert Cialdini, Cialdini, sorry Bob, I don't know how to say your name. He wrote this book called Influence, and in Influence, he talks about how reciprocity is one of the most powerful forces in human psychology. And what drives it, I think the hypothesis is That in order for humans to survive, we had to figure out reciprocity.
We had to make sure that we could maintain our social status and are standing within a small group by giving as much as we get so that we're not at risk of being kicked out as a taker. Reciprocity is so powerful. When someone does something for me, I have this conscious or unconscious need to reciprocate.
The other day I was perusing YouTube as I do, and there was this old SNL sketch Saturday night live sketch where you have these three men sitting around a table at a restaurant and they're playing this game where they say, I got it. And when the bill comes, they all say, I got it. And then they try to make the case for why they should be able to pay the bill. And it's kind of funny, but it illustrates this real thing in human psychology where one of the guys says, you got it last time.
It's my turn. And that's real. I have a friend, for example, he's probably listening. Hello. You know who you are. He never lets me pay for breakfast. We go out to breakfast. He never lets me pay. I've never paid for a meal in his presence. And at some point I had to switch off the reciprocity function in my brain around him.
And I had to just go to this nice place where I just accept and appreciate his generosity and I love going to breakfast with him, but in order to feel good in that exchange, I had to turn off reciprocity or had at least to reframe reciprocity. So that instead of viewing the situation as, Oh, he's just buying for me and I never buy for him. I had to reframe it as we enjoy this together. Isn't it nice? And what a great guy he is that he always pays for breakfast.
But it's an interesting quirk of human psychology that that was effortful for me. I had to work to be okay with the lack of reciprocity, not where his debt was growing, but where my debt is growing. Now come back to this new coach whose audience is growing consistently. The resonance is their follower counts, subscriber counts. They're growing in this nice organic way over time. And I've seen coaches do this for six months.
I've seen them do it for a year, for two years, for three years, where the latent demand. The pent up demand is growing in proportion to all the deposits that this coach is making into all those emotional bank accounts. The sense of reciprocity is growing within that community. Now, yes, I am generalizing, but I think I'm generalizing in a useful way.
And you, you're welcome to push back on my generalizations here, but I think I've got a lot of evidence that points to this mechanism working in this way. So reciprocity is growing. And then at some point, her one on one practice is full. She starts to see all the content online that talks about scaling and memberships and courses. And she says, yeah, I love my work, but I'd like to do more. Detach my results from my hours. And so I need to get into a scalable business model.
And then she goes to do her homework about how that's done. And she talks to people in her masterminds and she goes onto social media and she reads sales copy and newsletters and listens to podcasts and all the content funnels her pun intended toward launching. Launching now.
I'd be surprised if anybody in my audience doesn't know what I mean by launching, but let's just define launching as the attempt to have a bunch of people take a specific action in a short time window and What usually drives their?
willingness to take a specific action in a short time window is the promise of Specific bonuses that are associated with that action and also the the loss of the bonuses But also of the experience if you don't take action within a specific time period that's what I'm calling launching So she realizes I want to scale and what that's going to require of me is launching so now I'll build all the infrastructure required for launching. I'll have a different website.
I'll have certain pages on that website. I'll have emails that are presented in a, in an automated sequence. I'll have sales pages. I'll have expiring bonuses. They'll be presented in a certain way. Maybe there's a countdown timer in an email or on a sales page or both. And all of this is designed to have a bunch of people say yes at the same time. And in my experience, if she's a person who has spent a long time.
Building a relationship with the community and allowing that pent up demand to grow and allowing that reciprocity that sense of indebtedness that the audience has with the creator and I've experienced by this by the way There's a certain podcast that I listen to now that it really bothers me that all I've ever given him is my eyes and my Ears, I I have this sense that I need to send him some money or I need to buy something from him because We're talking dozens and dozens, maybe, maybe at this
point, hundreds of hours of value that I have enjoyed from his work. And I don't have a direct connection to his compensation. Yes. I watch him on YouTube. Yes. That pays him, but that's not connected enough to me to quiet my desire to reciprocate. So for me, this is a real effect. I'm not immune to it. I'm experiencing it. And I think it happens in coaches communities as well.
So her pent up demand is growing., her sense of reciprocity in the community is growing where people's sense of indebtedness is increasing toward her. And then she launches the thing for the first time. Now, depending on price point and depending on how big the community is and et cetera, and et cetera, she could end up with a bunch of cash in a short period of time.
At the very least, she probably priced it in a way that it's a lot of cash relative to what she's accustomed to in her unscalable model. And that's real. And I've seen it over and over and over again. Sometimes I I've, I've kind of named it sort of the first launch phenomenon I mean, talk about a dopamine rush. You have all the adrenaline associated with the launches.
You're building up to this, you know, countdown to midnight and you're hustling and you're doing webinars and maybe you're on, you're live on social media and maybe you're doing one on one calls as needed to make sales. And it's just this adrenaline driven thing that has pressure built into it because at midnight the carriage is going to turn back into a pumpkin. And a bunch of sales happen. Talk about intoxicating. I do not blame anyone for getting high on that drug.
And then it gets tough because if I'm right, that what was harvested in that initial launch was all the pent up, the latent demand. And if there was a big reciprocal debt paid by the community to the creator in that moment. That all makes sense to me. But what happens to that creator in the moment when she's so high on the drug, that is a successful launch is she decides that that's the new normal. And she says, this was amazing.
I think I'll launch every quarter or sometimes if she's really aggressive and optimistic, she'll say, I'm going to launch every month. And as I was thinking about that this morning while I was writing, I was envisioning myself as sort of like the grizzled combat veteran, like taking a long draw on a stubby cigarette with shaky fingers and saying, uh, it's always the new ones who think they can launch every month. You'll get killed.
You know, I'm very dramatic, but it, it's this incredibly naive position to take where you say, I did this once and it's the new normal. And what she's doing is she's saying that the launch happened Not just in the launch window, which was, you know, whatever two weeks or seven days She thinks that the launch Was created in the couple of months leading up to the launch window But that's where she goes wrong The launch wasn't created in those couple of months.
It was created in the Months or more likely years where she was building pent up demand and building reciprocity with an audience. And then it was harvested. And most of the harvest happened in that initial launch. If we imagine this as an auditorium, When she launched the auditorium was full of enthusiastic people a Bunch of those people in response to the call to action. They stood up.
They took the action She wanted and they left like they purchased So for the purposes of this particular offer, they're no longer in the auditorium So the number of people in the auditorium just shrunk and she thinks to herself, well, there's still a bunch of people in the auditorium, so they'll probably buy next month when I launch. But if someone has said no before, they're more likely to say no again.
Now, does that mean a person who has heard your offer a hundred times won't buy on the hundred and first? No, they absolutely might. That will happen, but it won't be the norm. Um, if it were the norm, I would have done a lot less comforting about failed launches over the last 10 years. What's closer to true is that they say no, and then they say no again. And now saying no is a habit.
And in order to stay internally consistent, they have to keep saying no because saying yes, where they said no in the past is internally inconsistent. And that's psychologically expensive too. So you might still have a bunch of those people in the auditorium, but with each successive offer, they become less likely to purchase because that's the habit they've formed. So each successive launch gets harder.
The coach feels like she has to do a more aggressive song and dance every time more features, more bonuses, longer programs. She's really hustling one on one calls. More time on social media live. And she's asking herself, this is the way she says it. This used to be so easy. Why is it so hard now where it used to be easy? And my answer based on having been witnessed to hundreds of launches is that it was easy exactly once.
But it was such a strong emotional experience that we anchor to it as though it should be the new normal. Now, is it always just once? No, I've watched clients launch successfully sometimes for two years, three years. They do have to work each harder with successive launches, both in the launch and in the period before the launch where they're trying to refill the auditorium. We'll talk about that in a second.
But there's this psychological thing that happens where a coach decides that because it was easy to launch once, that it should be kinda like that every time, and it's just not. Now here's where things can get really ugly, and I'm not being dramatic, I'm not being cynical.
What happens is at some point in these launch cycles, she realizes that she's got to refill that auditorium and again, she goes out into the world and again, she is funneled pun intended again, toward the idea that Facebook ads are the way to refill the auditorium. Facebook ads are the key to successful launches.
And then that becomes true kind of for a while because here's the next thing that happens in the audience She's able to take the existing audience and she's able to create Similar audiences and campaigns for those audiences in Facebook. So if her warm audience, her organic audience was the lowest hanging fruit, a comparable audience on one of the major platforms is the second lowest hanging fruit.
And you can harvest it with a good Facebook ads team, good creative and using the words that were resonant with your organic audience.
You take those same words and you use them with An audience on Facebook and that works and it can work very profitably for a while What what it's allowing you to do is take all the time That you spent building the organic audience and compress that time frame By going to facebook and saying give me people who are like this and then facebook can And now you've created not quite the same amount of reciprocity not quite the same enthusiasm You But the people are similar enough that you can Generate
some reciprocity and some enthusiasm in a much shorter time window and that works for a while And that's a huge relief to the person who's maybe her second launch and her third launch didn't go as well Oh, but her fourth launch driven by these Facebook warm audiences. Now that did pretty well. Okay, this is the new normal.
What a relief but She notices that her paid launches her advertising driven launches They start to get harder, too And then I hear people saying things like well the ads aren't working like they were working this is a classic mental error where people think that Facebook is this bottomless well, this fountain of ideal clients. And it, and it seems logical because there are hundreds of millions.
I mean, I know there are billions of people on Facebook or there probably are, but there are hundreds of millions of people who maybe fit their. Demographic, financial profiles such that they could theoretically purchase the product. But what you find is that with each successive launch, you're harvesting more and more of the people who might say yes. And you're also growing the number of people who have heard the offer over and over and are more and more willing to ignore it.
They're habituated to ignore it. So then we get into another phase and this is the phase where we go from people who are kind of warm to people who are more cold. And we're still trying to drive this through paid advertising. Well then what happens?
It turns out that when you aggressively advertise to people who don't have any built in affinity and by aggressively, I don't mean negatively or deceptively the same message that was so appealing and so welcomed by the people who have any degree of familiarity with you. That same message will feel aggressive, scammy, pushy to someone who has no familiarity with you. And if we get offline and think about our regular everyday lives, of course, that's how it works.
Think about saying the same thing to someone who. Nose likes and trust you, somebody with whom you've built rapport. You have long term trust and then compare the idea of saying that same thing to a stranger on the street. Of course, they're going to react differently, but as your ability to spend more and more on ads stays high and your willingness stays high, but the people that you're able to access are colder and colder to you, you don't just get much higher costs per conversion.
You also get hate. And I've tested this hypothesis by talking to a few people and they've said, well, we're kind of moving into more of a cold audience phase in the business. And I say, Hey, I have this idea that as you get more and more into cold audiences, you get more and more hate in the comments, the comments on the ads, the comments on the content. And again, I don't have a massive sample size, but I have multiple people saying, you know what? That's absolutely right.
You can't figure it out. We're saying the same things in the same way that landed so well in the past. And now they're drawing all this hate. I think there's a few factors at play there. I think the first time you did it, and especially in a warm audience, not only had you built rapport and trust, not only was there reciprocity where they felt some indebtedness to you for all your hard work and serving them great content.
I think that as we become more and more successful, we start to look the part. Accidentally. So we, we accidentally become less relatable as we succeed more. if I've succeeded with launching, especially over a period of years, I am naturally less relatable in the way that I look, the way that I dress, the way that I talk, it just happens.
And I'm also taking that and giving it to a less familiar group of people, which can compound on itself to where you get this effect of having a bunch of people in the comments hating. It's so confusing and it's, it's really hurtful, by the way.
I mean, I, I am of the opinion that there are certain online creators who behave in a way that yes, they probably should get some difficult comments, but on average, I think we have good people with good intentions, trying to do good things who are confused and hurt by the fact that they are getting just demolished in the comment sections on ads and on posts and et cetera. But I think it's just because we want to launch too frequently, too big.
We have the tyranny of making more and all of that is combining so that we have to be aggressive with people who don't know us that well yet. And you might pull it off once, but each successive time that you attempt to pull it off, whatever the financial results are, I can promise you that the mental emotional toll that it takes on you will grow. It will get harder and harder to psych yourself up for the whole process.
And it'll be very confusing because you're saying I'm spending more than I've ever spent to get worse results than I've ever gotten. and I haven't even acknowledged the fact that there are macroeconomic factors here. If the economy is, is a certain way, then. That is a factor.
If that's part of the public consciousness, if the way people are talking to their friends over lunch and the way they're talking after church and the way they hang out in their Facebook groups, that general discourse is going to make its way into a person's psychology and it's going to impact how they react to your offer. So of course the macro economic factors are at play. We're almost four years removed from COVID lockdowns. I think there are still coaches who are pining.
For what it was like to be launching programs and products during and after COVID lockdowns, when all of us were sitting in our houses with nothing to do it was the absolute heyday for selling programs online. That's a real macroeconomic thing. We don't need to pretend it's not. Okay. So where does that leave us? Well, in the worst case scenario, it leaves a coach who is exhausted, exhausted.
Discouraged, whose confidence is destroyed because she cannot make sense of the fact that the same fundamental set of behaviors and the same good intention to serve is now not only not producing results in the way that it did once or twice or three times, but she's even getting hate for it. she's so confused. Why am I getting hate today for the thing that I was, people were shouting my name from the rooftops two, three years ago, what's going on here?
Well, you didn't do anything wrong as in unethical. I mean, you might've done some unethical things. I can't, I can't say universally people are ethical and have good intentions, but my experience is most people are ethical and they have a real desire to do good in the world. Sometimes the pressure of trying to make a sale today will. Push their behavior into a place that they used to say was definitely unethical. And now they're kind of like, well, I got to make these sales and it sneaks in.
But on average, I think people are good, ethical. I think they have the right intentions. They want to help. And I think it's very confusing. So they've got this confusion, this lost confidence, they have low cash. And in some cases they have a lot of debt. And if anybody thinks I'm talking about one person, I'm not, I'm talking about a bunch of people with whom I have direct interaction.
And it is for all these reasons that if I stop here, I would say the launch based business model attempts to make too many sales too fast, too often. It violates principles of human relationships and a human natural, healthy human decision making. And as a result, it ends up ruining the lives of all parties. That's where I got to put myself in check and say, that's not true. Necessarily the case.
So in what scenario could a coach launch and not only have it not ruin her life, but actually have it enhance her experience of her business, create great financial results, strengthen the community that's around her. That's gotta be the goal, right? Why would anything else be the goal?
Now, how might that happen?, the thing that got me even thinking along these lines was the other day I was talking to the same client whose, whose most recent launch had succeeded, but had been harder than any other launch previously and less profitable than any previous launch. And she said the most fascinating and compelling thing to me. She said, I have the strong sense that our community loves it when we launch. And I said, okay, you got to tell me more. This is foreign to me.
I don't even know how to process what you just said, because I'm so, I admitted to her, I'm so cynical about the launch model. I'm so negative about it. And I confess to her, I haven't even shown you a 10th or a hundredth of my negativity. I can stomp around my house, slamming doors, slamming drawers, shaking my fists. Why do we do this to ourselves? My poor wife has heard me say a million times.
She's laughing and she said, no, listen, when we launch, we infuse the community with all this great energy and enthusiasm and focus on a specific topic. It's just this great thing. We, we just all rally to an idea and to a timeframe and the comment sections light up. And About how great this is about how much fun we're having about how much growth we're experiencing And I said, okay, then if we're gonna launch it all I want us to launch like that Now where she and I didn't get is how?
She can feel confident that it's always gonna be that way meaning That the community will always love her launches and be energized her launches As I've been thinking about it in the day since I have a couple of hypotheses. You can decide whether my hypotheses are of any use to you. My first hypothesis would be that launches have to happen less often. However often you think you can or should launch. I have basically irrefutable data that says it's not that often.
If you think you can launch quarterly, I would say it might be twice a year. If you think you can launch twice a year, I would say it's probably closer to annually. And if you just do that, then you at least give yourself a longer season in which to make a bunch of deposits into the emotional bank accounts of old friends and new acquaintances. It's an opportunity to reestablish that latent demand. It's an opportunity to support word of mouth marketing in your business.
Do you know in what business it's hard to have a lot of word of mouth marketing it's one where when I recommend your business, I have to disclaim about your business before I recommend it. I have to say, look, he's got really good stuff. You just have to be prepared for a lot of sales messages. Because nobody likes a lot of sales messages. Nobody likes a highly transactional interaction. So even when the stuff is good, we feel like we have to disclaim.
But if I back off on my launch schedule, now I'm making it easier for the person who wants to refer me to say, I love this person. Their stuff is so good. I love their vibe. I love their way of being. And they do sell sometimes, but it's not that often. And to be honest, I kind of like the way they sell. I, they do these launch, they do these challenges or whatever it's called. They're kind of fun.
It, it allows for word of mouth marketing in a way that aggressive, frequent launching just doesn't. And that's my opinion. And I wish there were someone here who disagreed with me and I would debate them actually until I died. Like I will die on this hill. Now, beyond launching less frequently, I would say we'd be wise to launch less aggressively.
I would say that we'd be wise to relax a little bit and allow for the fact that if I'm back in that auditorium, the more aggressive I am with today's offer. The more strongly the person who says no will react to me. So i'm giving them a big ask and they're having to give me a proportionately big no And that no will be harder for them to overcome on subsequent offers So if i'm a little gentler in the initial ask I still I still make invitations directly.
I still say I want you to do this and here's why and here's how I think It benefits you But I don't try to Pull on the FOMO lever quite as hard. Then that person might stay in the auditorium. They might be ready for a future offer and they might invite other people into the auditorium to, Speaking of FOMO, I do want to talk about FOMO. I think there's two major psychological forces. In these two approaches.
So in the approach where I launch less frequently and less aggressively and where my hardest work is outside the launch window and not inside the launch window. In other words, where I'm spending every day thinking about how can I be useful and of service today? How can I make big deposits into emotional bank accounts today? For me, that's an approach whose goal emotion is gratitude.
In other words, I want to give so much that they feel grateful and that their gratitude will kick off all these other good behaviors. I think a low aggression, low frequency approach is more geared toward gratitude in the audience. I think a high aggression, high frequency approach is more geared toward fear in the audience. And that's what my bonuses actually are meant to do, by the way. My bonuses are not. Intended to actually build the value. And I know you're good, ethical people.
And you're going to be like, no, Mark, that's not true. I want to make the, I want to make the offer irresistible. Well, the question becomes why is the offer irresistible? Is it because of all the value in this thing that they probably won't consume anyway, meaning all these bonuses or whatever. No, the truer thing is that adding all those bonuses is designed. To give them more to lose. If you don't sign up by this date and that time you lose these bonuses. So we're triggering fear of loss.
Loss aversion is a powerful psychological force in the human brain. The study in the one book said that people are more afraid to lose a hundred dollars and they are excited to gain a hundred dollars. So I think an aggressive high frequency launch approach is built on fear. And I think a gentler, lower frequency launch approach is built on gratitude. In which one of those approaches would you like to spend most of your time?
Um if you acknowledge the psychology at play here, and if you take the long view, and if you decide to launch less frequently and less aggressively, and if you make gratitude the emotional foundation of your approach as opposed to fear, and for those of you who think that it's not based in fear. Sorry, a countdown timer is not a gratitude mechanism.
A countdown timer is a fear mechanism, but if you'll launch less aggressively, less frequently, and if you'll base your efforts in the desire to generate gratitude instead of tactics that are effective at producing fear. You will make selling easier in the long run. Short term results may suffer a little, but you create an opportunity for long term results that may go away completely if you're too aggressive and too frequent in pulling the fear lever. So can we launch? Yes, we can launch.
Do I personally have a desire to launch? Yes, we can launch. Given everything I've seen, not yet, but I want to thank my client. She knows who she is. She might listen to this. She has cracked the door on the whole idea for me. She's helped me to rediscover a little bit of curiosity so that I can say there may be a scenario in the future where I have a training, where I have a book, where I have something that I think lends itself well to a launch window. Thanks to her.
I would say I would consider whether to do it. I would ask myself, can I do it? Can I do it in a way that's pro relationship? That's pro gratitude. That's anti fear. And if I can great, maybe it can be of real service, but the FOMO driven version of this ruins lives. The only winners in the FOMO driven version of this are the platforms, Facebook, Instagram, Tik TOK, only they win in that scenario. The buyers and the sellers both lose net net. Do some people end up happy?
Yes. Some people end up happy. Do most people end up happy? In my opinion, they do not. So I hope I have given a. Reasoned considered view of this particular approach to making sales at the very least what I would say is Proceed with great care and caution if you think launching is your next step And I will catch you in the next one