Episode #48 - Converting Customers: Part 2 of The Transformation Formula - Teacher Zone

Episode #48 – Converting Customers: Part 2 of The Transformation Formula

Last week we talked about Attracting new potential customers. But attracting them falls short if they don’t sign up and become paying customers.

That’s a process that needs some love and attention. If it’s hard, confusing, and messy to become your customer, then that starts EVERYTHING off on the wrong foot.

So that’s what we discuss in today’s episode…Converting Customers.

Watch it Here

Or Scan the Show Notes Below

0:00:05.0 Tyler Marolf: Welcome to the next episode of The Teacher Zone with Chris and Tyler. I’m Tyler Marolf. I’m here with Chris Bates, and today is part two of the transformation framework and formula that we’ve been going over. So Chris, how are you today? And tell them really quick how they need to listen to the last episode and what it was on before we get into this one.

0:00:28.0 Chris Bates: I am awesome, and I’m so glad that you’re listening today. We’re gonna talk about the convert part of the formula. So for those of you that have listened to the last episodes, we talked about our transformation formula. We also talked about the first aspect, which was attract. Before that though, we did talk a little bit about our leadership, and that’s why this is a hybrid. So it’s basically how do you take your leadership style and how do you take the transformation formula that’s in our webinar, that’s in the podcast that we’re talking about, and how do you actually implement that with your teams? 

0:01:04.0 CB: So the first, go back and listen if you need to to attract. That talks about Tyler and I’s team there, and just to try and give you guys some inspiration, and then today convert is gonna be about how we convert customers from, we talked about how we get them from a lead to wanting to sign up, and today is the sign-up. So today’s convert, they’re becoming a student. They’re joining your program. They’re taking classes or lessons with you. So how does that work? So in the bottom line Ty is that you and I need to get out of the way for if you’re listening to this as a director or owner, just know that your team is there to help make what we do enjoyable. If you’re feeling stressed out, it’s ’cause you’re wearing too many hats.

0:01:53.5 TM: Right. So a quick review about last week, what are the three things we’re in charge of as founders and owners? And I know we wear 12 hats at once when we start our businesses and entrepreneurs, but the goal is to run an amazing and healthy and fun business to where we’re not working 80 hours a week. What are the three things we’re in charge of Chris? 

0:02:20.0 CB: Very, but most important is vision. Second is people, and third is finances. Vision, people, finances, those are the three most important things guys, and vision, vision, vision, vision, vision. Our real job is to remind our customers and our staff and the community at large over and over and over what it is we do, our vision.

0:02:43.3 TM: Right, and so the four parts of the framework are all vision-related, attract, convert, deliver. How, how do we do everything here and then transform that culture, tribal, amazing community impact, okay? So today’s pillar, correct me if I’m wrong Chris, is very people-based, like the people we found so that Chris and I can concentrate on growing the business, not working in it, but working on it is this convert is that people side. And do we have systems in place that makes it easy for the people, so the people that are already there, do they feel empowered and is it turnkey? Or is it just a mess? Is it taking too long? Are we it losing out? 

0:03:35.0 CB: Yeah, the messier your process to get someone from when they raised their hand to getting into your program, it sort starts off on the wrong foot, if you will. So it’s really important that the convert part is super clean, and Tyler and I are still defining, to be honest with you, we know with our team, all of us, what we’re trying to accomplish, but we’re trying to define the words around it, the words that he and I use a lot on the vision of our business, and so I impart you to before we get into this convert, just sort of think about that. How do you wanna impart your vision to your team in the world? One of the things that we say Tyler, [0:04:09.5] ____ on a vision. As we say, good values, make friends, play for life. Right? 

0:04:17.6 CB: That’s like our basic vision. Right? It’s not music lessons. It’s not Performance Academy. We happen to have our Performance Academy, but that’s not the vision we’re trying to impart.

0:04:28.0 TM: We also have a little side note that we’ll say on occasion to parents that get it. Most of ours do we’ll say, “Hey, you know what? Music is important at our school, but first and foremost is character and relationship building.” With those two things, you can do anything extraordinary in any avenue, and we just happen to do music and whatever your school does, that’s your thing. So I know you guys are relating to what we’re talking about here, so we’re gonna get into the three aspects of convert and how the teams handle that, and this is probably gonna be a short podcast because if it was long, we’re doing it wrong.

0:05:09.0 CB: Good point. If you haven’t heard the Transformation Formula Webinar, go check it out. It’s on our website, and transformation formula is a framework where we basically, from working with all of you around the world, we’ve come up with basically the four most important aspects of running our business. So number two is convert, let’s get into it. So the first thing to put Tyler to converting someone is your offer, which is pricing simplicity, basically just a simple offer so people know what service am I buying? 

0:05:40.0 TM: Right. Tell them who’s on our team for that, Chris.

0:05:43.4 CB: So for that, it starts with Tyler and I. I mean, he and I are basically the crux. If you look at the entire business, this is, he and I are the lead on this one.

0:05:53.0 TM: Well and I’m also known in many forums around the galaxy as the pricing gladiator. [laughter] So I have literally no fear of pricing us into the right amount of value, price ratio. I don’t have a fear, so I kind of just have this big shield that says pricing by Tyler, and I just put my shoulder into it and we go, we’re smart about it, and never once have we had anything adverse hit the company, not once. And so there’s some pricing episodes you can go back in time to listen to, but if it isn’t simple, which is the point of today, then it’s just gonna be convoluted to the customer and the convert won’t be easy. Right, Chris? 

0:06:41.3 CB: Yeah, so how we talk about our pricing, we happen to have a really simple membership model. So, in the pricing aspect of convert, it’s important that you, number one, have a clean, clear messaging website. So, our team on the pricing and convert side is Tyler and I, Brad our messaging person and then Drew, our website guy. So, the four of us try and make sure that it’s clear, but we do not have pricing on our website, you get that in a phone call with Tyler that… You might remember, we talked about Alexa and Taylor on the last episode. When they call to qualify the prospects, they then schedule a phone appointment with Tyler, and we’re not doing group appointments.

0:07:22.7 TM: Now that will be a group appointment through Calendly. So, we have streamlined two aspects of the attract, which there’s a little tour thing that Chris does. Instead of doing 12 different 30-minute individual private tours a week, we do them on a single 30-minute period now. And it’s this big group of…

0:07:43.7 CB: They’re way more fun, they’re way more effective and people love being together.

0:07:49.3 TM: And so we thought… And then Chris was like, Tyler, and I’m making a video, I’m doing all this stuff to optimize this phone call part, this intimate boutique. We wanna know about you.

0:08:00.4 CB: These guys some days, Alexa and Taylor are so effective, you should see Tyler’s schedule, some days he was having five calls a day with new prospects, and that just drains a day.

0:08:09.7 TM: Now, it is not necessary, you pop them on a virtual meeting, we all got trained overnight how to get into Zoom. Well, my Calendly link has my go-to meeting in it. And so they all pop in, we wait till they’re all there, and I guide everyone through the pitch all at once. Imagine what is… Our customer is about 4500 to 5000 a year customer, right overall. Imagine five to eight of those at once, and they scheduled it, it’s powerful and it’s quick.

0:08:43.7 CB: And there’s something about converting people in groups, by the way, guys, is they end up selling each other, so last week I had eight families tour. And what was so neat, there was two different 30-minute tours, that’s it. So we sold eight families of 5000 a year membership in only an hour combined, right, and it was super enjoyable, everyone sold each other ’cause they’re laughing and you can be more entertaining and all this. So, our process on the price simplicity is come up with something that’s very coherent, so what happens is, is that Tyler on this call, he tells them our price, which is we’re a one price.

0:09:22.8 TM: And they also hear the three things that everyone gets with their membership and that’s it. And I tell them that, “Hey everybody, this call is to the point, you need your nuts and bolts to take back to your families to find out if we are even the right fit for you. So, I’m gonna give you the three things that every student gets with the membership and then the price. And if you like that, you guys hop on a tour and all your dreams will come true.” It’s so basic.

0:09:49.4 CB: And then our tour, we try and make that all about the why. So, we make that about the actual students themselves, we really get them excited.

0:09:55.1 TM: And we tell that on the phone call, we say, “Hey guys, your kids are already here, we’re not interested in how excited you are about the program.” I call it, I kind of coined it recently, Chris, I don’t know if you even know this, this is hot off the press. It’s the 51% buy-in shareholder rule. The kids need to be that 51% majority holder of their journey at the school, and their parents don’t have voting rights.

0:10:27.1 CB: I love it.

0:10:29.9 TM: I don’t say it in that detail, but they get it, and we’ve always said it kind of that way, but I gave it a name. And the parents were like, “No way. That makes sense.” Unless they’re a parent that’s like at the very end, “Can you just come to the house and teach piano?” That’s the beauty of all this. It’s so simple, it’s like, “No, but we’ll refer to Danman’s down the road.” And so on, so it really helps not only pre-qualify but zip the people in to convert, like that.

0:11:01.5 CB: So, the first part of our convert is conveying our value and our price simply and over and over and over, so they know what they’re getting, and we try and drown them in value, so they feel like, “Oh wow, for that price, I feel like I’m actually… It’s inexpensive.” So, we don’t wanna talk pricing because…

0:11:23.2 TM: We have an episode on that, Chris, that episode is timeless, that thing is still good, go back and listen to it.

0:11:29.3 CB: Most of you were so far under price because you’re just… You’re so worried about competition versus value, it’s only about value okay? So…

0:11:37.5 TM: By the way Chris, real quick bullet point on this, if I may. If, in fact, they don’t tour or they do tour at this point, this is just a quick one, it goes right back to attract, and if they don’t do any of those things immediately, it turns right into attract, into the system. Except they got to see who we were. And so the girls… Our teams follow up, and then boom, we had someone show up the other day and they’re like, “Man, those Alexa and Taylor,” Wyatt, remember? They just stayed on me and I got excited, you know what I mean? And so that part of the system is never ending, okay, that attract meets convert.

0:12:20.6 CB: Well, if you think about it as far as a funnel, like people always talk about a marketing funnel, the attract part is the top of the funnel where leads are coming in and they’re talking to Alexa and Taylor, and they’re scheduling the call, the group call with Tyler. Then, Tyler’s group call is the middle of the funnel. He’s now saying, “Who’s going to get to this bottom part of the funnel?” Then he schedules group tours with me, which are the bottom of the funnel, right? From that group tour, we’re literally seeing sign-ups happen that next day. So from the group towards the close. And so we’re then getting into enrollment, which is the next step, in convert so…

0:12:57.9 TM: This is the part that’s quick. This is the short, to the point part everybody. So stay tuned, right now. Go ahead, Chris.

0:13:04.5 CB: Well, now that we’ve gone through that whole process of attracting a lead, getting them to the top of the funnel, Alexa and Taylor following up… Up to 13 times if they have to. Them getting other emails from Spencer, social media, and all this other stuff. They’ve now gone to the middle of funnel. They’ve talked to Tyler, and got excited with some other folks. Then they’ve gone to the bottom of the funnel, and they’ve actually come to see our facilities. And that’s where the rubber meets the road. Because when they decide to actually pull the trigger, then what we tell them is, we say, “Listen, you can’t decide today, but tomorrow when someone reaches out, if your… If you student… ” We actually talk to the students. We say, “If you, student are excited, then we’d love to have you, and mom and dad can figure out how to make it work.”

0:13:40.8 TM: That’s the only requirement for membership, kiddo. You have to wanna be here, and you need to go home and decide. And you know what? It’s powerful, and at that point, that’s when it gets easy because if they don’t enroll… By the way, buyer beware. I tell all the parents, I go… “If you go on the tour, 90% sign up.”

0:14:01.8 CB: Right. And that’s pretty true, because what happens is, by the time we’ve got them through that funnel, the tour is the bottom of the funnel. They’re ready to sign up. So then what we see the next day is Spencer Hayden, who’s on the enrollment team. So it goes from pricing, simplicity, or the offer to enrollment. He’s on the enrollment team. So Spencer and Melissa. Melissa is the lead, Spencer Hayden is right behind her, and then underneath that’s our Director, asking and other teachers that might help out. Why? Here’s what happens. Spencer, next day, sends everybody a quick email, “Hey, I know you had a tour yesterday. What questions do you have?” That’s it, so people come back. Oh, you know what? I’m sorry. He gauges their interest and questions.

0:14:39.4 TM: And usually it’s like, “Hey, he really loved the tour. What do we do next?” That’s the most common answer. And so why don’t we just skip to that one? 

[overlapping conversation]

0:14:55.8 CB: So when people say, “I’m in,” then Melissa takes it from there. So bottom line is that Melissa gets them over the finish line. So Taylor, she takes our automated, online, Cloud-based registration, and sometimes it’s on our website, sometimes it’s a registration link, and she just gets them to that registration, “Oh, you wanna enroll? Great, before we pick your time and your teacher, I need you to go do this.” So the very first step is collecting their data and their credit card, right. We’ve not charged them yet.

0:15:24.6 TM: And they not only do they customize their answers, based on questions we created, so we know exactly what the… ‘Cause at our school, our teachers are all multi-instrumentalists. All schools are different, so we custom boutique, pick who their journey is gonna be with based on their first, second and third, most important instrument goals. Maybe it’s just one instrument, but if there’s vocals, piano recording, that could be any of four of our 13 teachers. So therefore, our school, we don’t really have the widget set up where they can go and… They can read the bios all they want, but we place them by a vote. So that’s our little niche.

0:16:09.0 CB: By the way, Tyler, I have to bring this up. So we work with so many of you, and so many, whether it’s athletics, or we work with you with in language schools, or in the performing arts. It really doesn’t matter. If you’re teaching lessons or classes, privates or classes, then we all have that camaraderie, that synergy as far as how the offering works. So basically, what we’re doing is we’re distilling them into our privates. So the enrollment form, the registration form, gets sent, and they fill that out. As soon as they fill that out, now the next level happens. Now Melissa actually has data to go off of.

0:16:48.2 TM: And they’ve agreed to our agreement for parents/students. So…

0:16:54.4 CB: At that time, guys, we’ve already had them agree to our policies and procedures. So now they know the rules, now they know the requirements, they’ve answered the questions. We’re pretty much taken care of all the administrative stuff off-site, they’re doing it in their house.

0:17:11.7 TM: Yep. And our operations doesn’t have to… Melissa does not have to do it. And so here’s the great part, it looks so pro that today’s day and age is so cloud-based, that these families that know we have something special, this is just backing up the spine of our vision. That’s all that’s doing. It’s enhancing the mission and vision. Because let’s just say this, eight years ago, the mission and vision was there, but a lot of the bones weren’t. It was chaos. And so we’ve come a long way to get here guys. So you’re hearing a journey and where we’ve gotten to, to make this…

0:17:48.5 CB: Well, I believe automated… We have happened to use teachers on it… I think a lot of you listening are teachers and users too. But bottom line is that how you bring them in, it’s that first impression with regard to our professionalism. And so the fact that we do it very professionally, they get a great welcome email, they’re in, fabulous. Then the last stage is the automated payments. That payment trigger, guys, they’re not allowed to get on our schedule because basically, what they’re doing in the lesson and class business is reserving your staff’s time. They can’t reserve time without paying. So then, that’s where she gets… Why don’t you talk about that last stage, the automated payment stage? So we’ve got…

0:18:32.0 TM: Well, the automated payment stage is so easy because they’ve already put in either their ACH or credit card info. And oh my gosh, 80% of our customers… And we have a… We have a MRR of what, 80K a month. 80% of them love credit card miles, so they’re paying it off the next month, but they want the miles for the tuition, so I just thought that was a side note, that was a fun fact about people… For lessons.

0:19:07.7 CB: Yeah. I hear people tell me My customers don’t wanna pay by check, I’m like, No, they don’t… Yeah, nobody, nobody does the…

[overlapping conversation]

0:19:13.9 TM: Do you know how much gas it burns to use the energy to write with a pencil? 

0:19:19.4 CB: So the automated payments kinda make everything work, and Melissa gets that set up and the schedule set up, which again, they get auto notifications for that, and then lastly, Melissa is able to send the last… Hopefully, you got all that. Here’s directions to the school, here’s the room you’re in, here’s a teacher bio of the teacher we’ve set you up with so you can read it to your family, and then Tyler, she also pings the teachers right? 

0:19:49.9 TM: No… Well, yes, she pings the teachers based on the goals and information that we’ve learned about that child along the way, so they get a very short and sweet three to five sentence paragraph of who they get to meet and start to work with, but otherwise as soon as they’re on the schedule and the auto-pay starts, which is all magic, it happens immediately wants they hit the schedule. The teachers are notified, congratulations, we customize it. You’ve got a brand new student at Los Rios and it says their name and what time, and so the teachers know exactly, and it’s kind of exciting ’cause we make it sound exciting, they’re getting notified real time when that kid hits the schedule, even if he doesn’t start till next week.

0:20:35.1 CB: And when they register, by the way, we not only get the teachers on notification to our staff, but we hooked it up to Zapier and we have a really fun… Throw a party, we just got a new student email that goes out.

0:20:48.8 TM: To all operations.

0:20:51.1 CB: Yep. To the operation staff, so it’s a way to make this like a celebration, so that’s convert… We can get into more detail, but that’s the bottom line with convert, so now we’ve got attract and convert both of those elements guys basically are creating… We’re trying to get to transform, and we’re trying to get to engagement that creates a long-term student that retains the more your students retain… What is your average retention… Right.

0:21:17.1 TM: Right. Right.

0:21:20.1 CB: And the industry and the learning. Business, the average retention is typically, I think about 13 months, and so in all of our goals…

0:21:22.3 TM: How many seniors did we have graduate last August show… Was it 14 seniors? 

0:21:34.3 CB: It’s usually about 12 to 15 seniors.

0:21:37.2 TM: Yeah, and so you guys… We looked at the average age of those that they started with our school, and the… I looked it up, and it was around 12 to 13 years old that those college seniors were leaving, and Decks even started when he was younger, Chris’s son was one of them. He was with us forever…

[overlapping conversation]

0:21:57.9 CB: Oh it was great on stage, Tyler you weren’t at that particular announcement, it was so cool what the announcement were those seniors… A lot of the seniors were there. I said, “Hey, how long have you guys been with us?” I screamed from the audience, and Drew is like eight years… Decks was like seven and a half. Six years, nine years. I was like what? They’ve all… Everybody had been with the us over five years. Yep.

0:22:24.7 TM: And that is all based on this framework, you guys, we’ve had a mission to make an impact for a long time, and it wouldn’t have survived if we didn’t start to change as individuals and learn that there’s a process that has… People wanna build more trust and grow with us, so these customers and these families, they trust us, they need to know that we have their back and that their kids or any student is protected, that’s our vision, and that’s why the framework works. So next one, we’ll be getting in to deliver the proof is in the pudding though Chris. You could have as much culture in your brain that you want, if you can’t deliver how you do it in an efficient manner that is fun and easy to digest, you’re dead in the water, so that’s gonna next…

0:23:15.8 CB: The next two are your business. You’re right, you’re dead in the water. The next two are your business, the first two are what keeps the business… It’s kinda like eating, if you don’t eat you don’t live, so it keeps the business healthy and alive, the last two are what you consider your business deliver, transform.

0:23:34.6 TM: If I can keep a $5000 year student for seven years, I’m just telling you, it starts to make things easier. [laughter] Why would I want them gone in six months? 

0:23:50.0 CB: And it’s how we’re able to retain some of our extraordinary team members, and…

0:23:54.1 TM: Oh, that’s a huge part of it, we’re gonna have to add that to the outline in the deliver because that team. Oh, this is gonna be the best team part, this is gonna be the best to team part…

0:24:02.0 CB: So stay tuned for next week we’ll get on The deliver part and our team that handles proving all the things we promised these folks to get them to become customers.

0:24:09.3 TM: Thanks again everybody for tuning in and go to teacherszone.com for more information about Chris and I, and podcasts and webinars and all that, and we just appreciate your listening and viewership if you see us right now… Hello and we’ll see you at the next episode on the flip side. Thanks a lot Chris.

0:24:28.0 TM: Thanks Ty.

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