Danny Iny Interview - Engagement From Scratch (Transcript)

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Steve: Hello everyone. Welcome to the Small Business Marketing Show. I'm your host, Steve Gordon. I'm the founder of Steve Gordon Marketing Systems, where we help small business owners get more clients on autopilot. You're on the Small Business Marketing Show. We are laser-focused on bringing you the real strategies that are working now, straight from my underground network of marketing experts.

We've got a real treat for you. Today on the line with me is Danny Iny. Danny is the author of "Engagement From Scratch!: How Super-Community Builders Create a Loyal Audience and How You Can Do the Same!" He's also the author of "Naked Marketing." Danny is known as the Freddy Krueger of blogging, which we're going to make him tell us all about in a few minutes. He's one of the guys behind Firepole Marketing.
Danny, welcome to the Small Business Marketing Show.

Danny: Thanks, Steve. I'm really excited to be here. I'm excited to be part of your underground network.

Steve: I'm really excited to have you here. I think we've known each other for a little over a year. I've really enjoyed watching you build your online audience--really, a fairly large online audience. You've built it in a really short time. I've really been impressed watching how you've gone about it.
Today, I'd love to have you share with our listeners why having an audience is important to small businesses, and how they can get started building an audience and engaging their audience.

Danny: Sure. At the core, when you think about smart business strategies, when you think about making your business sustainable, what you want to do is try to create some disconnection between the works that you do today, and the money that you make today.

Now, it's not saying you want to set up your systems and just see income on autopilot, make money from a beach in Tahiti. That's all nonsense. But you don't want to have to go out and hit the pavement today to find customers today, because that puts you in a very vulnerable situation as a business. If nobody knows who you are and nobody trusts you, if there's no reputation, no engagement around what you're doing, then you're basically starting from scratch with every sales conversation, with every marketing interaction.

Having an audience just means that people know who you are, you're invested in that relationship, they trust you and care about what you do. You've got that kind of fanbase that you can always draw on as a base that drives your business. The classic examples that people like to point to, they're all online businesses, they're all blogs. But really, the best example is a very traditional kind of business.

Look at Apple. Apple is a perfect example of an audience-driven business. They do really well not because of their technology, not because of any of the things that they're doing--not that I'm knocking any of those things--but they do so well... when they announce that they've got something new coming, and they've got people lined up around the block for three days, that's not because of the technology. That's because of the enormous amounts of engagement on the part of the audience.
So imagine what it would be like if you could announce some new thing that you were doing, and people would just line up because they're that excited, because they care about what you're doing. Because when you put out an announcement, it's not some press release that nobody's interested in; it's a piece of news from somebody that they care about, about something they're interested in. So they watch and they pay attention.

Steve: When we talk about this particular topic, for a lot of the brick-and-mortar businesses that I work with day in and day out, when we start to use words like "audience" and "engagement" and all that, they go, "God." Their eyes roll back in their heads and they go, "Well, that's just for big online businesses or big businesses like Apple." The first thing that I hear from almost every business that I encounter is, "Well you don't understand. All that marketing stuff doesn't work for my business.
My business is different because of X or Y. We're really in the commodity business."

What I have found from building my own audience--and I'm sure you would agree with this--is that by building an audience, you create this little market almost all to yourself. You really eliminate much--if not all--competition, because you've got people's attention, and they're paying attention to everything that you're doing. So you don't have all of these competition or all this price pressure, and the things that most folks run into when they work in sort of the traditional marketing advertising model.

Danny: That's absolutely right. You said something really interesting there that is actually kind of true. If someone said, "This doesn't apply to me because we're selling commodities," there are situations where an audience-type business is probably not the best way to drive your business. If you're doing these very large B2B contracts where you're responding to RFPs and putting through proposals and doing all that stuff, does reputation matter? Yes, of course. But is audience the best way to drive your business? Probably not.

Likewise, if you're selling something that is totally a commodity, you're selling RC Cola in the supermarket or you're selling a generic, no-name gum at the checkout counter or apples in the grocery store, these are things where you don't need an audience. An audience is probably going to be a lot of work that you're going to do and would not accomplish very much. But most people are not really in that kind of business. Because even if you're selling commodities on the face of it, the reason why people buy from you is not a commodified reason.

Let's make up an example. Let's say you run a hardware store. That's as traditional brick and mortar as you can get. Why would someone come and buy their hammer and nails or whatever from you, as opposed to somebody else's hardware store, as opposed to going to Home Depot or Lowe's or wherever? First of all, it's not the commodity reason, because I don't think anyone's price comparison shopping, based on the cost of nails or the cost of a hammer. It doesn't matter all that much. Yes, proximity, location is going to matter a little bit. I'm not going to drive across town for a box nails when I can get them nearby. But assuming there are a few providers, a few stores, a few places I can go to to get these stuff in more or less the same range, how am I going to choose?

I'm going to go to the one that I like the guy, the one where I walk in, the guy says hello, I like to see his face, I like to have a little bit of chitchat. Maybe I'll tell him what I'm planning on doing, and he can advise me which of these nails should I actually be getting. This is opposed to walking to some superstore where nobody knows anything and just trying to grab something off the shelf, getting home, and then destroying my new IKEA bookshelf because I got the wrong equipment.

The reason why people buy from you is not a commodified reason. That's how you stand out, if you are selling commodities. I could argue it the other way around. If you're selling something that's so unique, if you're Apple, and you're the only one who can provide the iPhone, maybe you don't need the audience, because if people really want an iPhone, then there's nowhere else they can go to get it. But if you're selling nails, then what choice do you have? How else are you going to differentiate and distinguish yourself?

Steve: I think I'd even argue that Apple was in the commodity business. You can go to a dozen different places and get a phone that will allow you to browse the web, download your e-mail, get on Facebook, and answer telephone calls--if you still take telephone calls. What they've done by building that audience, one is they had a market to take that very exceptional product to, where they knew that they would get a return on their investment for developing it. But they still have competition all around them. Yes, they've done a very good job.

I've used iPhones for I don't know how long they've been out now, but for a number of years. I wouldn't go with anything else, because I'm part of that audience. I'm a locked-in sale for them. The iPhone 5 just came out a few weeks before we're recording this. My wife has already got us pegged for when our upgrade date is. That sale is already made for Apple. That's the advantage of them having an audience. But it's not as though they do that in a vacuum where there's no competition.

Danny: No, for sure. Something I like to say is that if you're really great at marketing, you don't actually have to be very good at marketing. I think Apple really embodies this, because the way that they engage their audience, turns them into a super loyal fanbase, it's really phenomenal. It's very impressive. There's a lot to study and learn from: the way they promote stuff that's new to make people who are part of that community feel like they're getting something really special, the ads that just show the device because it's that sleek and that cool, that's also very well done.

On the other hand, when you look at how they launch some of their stuff, look at the slogans for the last three or four versions of the iPhone, "It's coming," "It changes everything," "It changes everything again," there is really not a lot of compelling originality to anyone who is not already part of that community.
So having that engaged audience, doing a good job of kind of building that initial groundwork and brand work, it really alleviates a lot of that burden to actually be particularly good at marketing further down the road.

Steve: I've gone through your book "Engagement From Scratch!" It's actually the second time that I read it, in preparing for our talk today. As I read it, it's really almost a how-to from a lot of different perspectives of getting going with building an audience and building an audience that you're really engaged with. If I'm a small business owner and I'm listening to this, I go, "Well yeah, these ideas make some sense, but what's the first step? How do I get going?" How would you advise them?

Danny: There are three steps to effective marketing, like really solid, black belt level marketing. Those three steps are first of all, you've got to align yourself with the right customer. Then you've got to attract the attention of that customer. Then you've got to engage them.

The first really key insight that you need is that each of these steps matters to a different degree. What most people think is that attraction is the role of marketing. It's to attract attention. Alignment and engagement are peanuts; those are on the side. But it's really the other way around.

The good marketer is going to spend a lot of time on alignment, a lot of time on engagement, and attraction really doesn't take all that long. If you're well-aligned with the audience, it's quick, it's easy, and it's a moment in time before you can hand off to engagement. Assuming you know who your audience is, you know who it is that you want to reach, if you haven't reached them yet. You understand them in and out. You know what matters to them. You know what motivates them. Getting their attention should not be that hard.

Nine times out of ten, when people have trouble getting the attention of their audience, it's because they don't know their audience as well as they think they do. They really need to go back to the drawing board, do their customer profiles and their one person and all that kind of stuff.

But assuming you've got all that in place, we can turn all of our attention to engagement. It's a really simple, two-step process. The two steps are commitment and reward. So you give someone an opportunity and a reason to make a commitment. Then you reward them for making that commitment. Then you repeat that cycle with a slightly bigger commitment.

What a lot of marketers--so-called marketers--will take this to mean is that, "Oh, so you sell a $7 product, then a $27 product, then a $197 product, and keep kind of going up to this marketing funnel of escalating dollar value." That is one way in which this can be expressed.

But what it really comes down to--and this is the key insight--investment is not primarily financial. Investment is something that is emotional. People invest with their time. They invest with their attention. They invest their trust. They invest by sharing their dreams and their ambitions. All of these things are kinds of investment.

A great example is the hardware store guy. Sure, buying stuff from the hardware store is one kind of investment. But going to the hardware store, asking my questions, saying, "I have this shelf. I need to put it together. I don't know what to do." I'm sharing my vulnerability. I'm listening to the guy and getting advice. I will probably be more invested in that particular relationship if I go, I ask the question, I get my information, I listen to the answer, and don't buy anything, than if I just go in and buy a box of nails and walk out.

I'm not saying don't sell stuff. Because when people spend money, that is also an investment, and that's great. But I'm saying, recognize that most of the rungs on that ladder are not financial in nature. So it's, how do you get people to invest their time, their energy, their attention in the relationship with you? Then, how can you reward them and ask them for a little bit more, and continue that cycle? Does that kind of make sense?

Steve: I like it. It makes perfect sense. So often, we get focused on those transactional events when money is exchanged. We think that that's all there is to it. But everything that leads up to that is critical in making that exchange of money occur.

I know when I'm working with small businesses, we talk about changing the mindset from making a sale as this event, to it's a process. That's really what you're talking about, is what has to occur for you to begin to build a relationship with a potential customer. In a lot of ways, this isn't very different from what we've done kind of all along in business, but we've done it one on one.

What I like about what you've outlined in the book, is it's really a methodology for taking that type of one-on-one interaction, and now being able to scale it, so that you're not just one on one, you can attract a much bigger audience. Or maybe you're not looking to attract a million people, but you'd like to attract people that are in a very specific niche or have a very specific problem, and you need to attract them in a larger geographic area. Well, the magic of the internet now makes that possible. But you've got to figure out how to build a relationship at a distance like that, and still give it the richness that it would have one on one. I think it's very possible to do that, but you have to think differently about it.

Danny: Yeah. The beauty of this engagement cycle--this cycle of commitment and reward--is that it is completely industry and market independent. The attraction part, the kind of how do you track down your customers, get in front of them, and wave your hands so they notice you... that'll be different from industry to industry. It depends on who you want to connect, in what context, et cetera. Everyone knows their own industry.

Let's assume you know how to connect with someone to begin with. From that point to then go from, "Hi. Hello. Nice to meet you," all the way to someone being a loyal, engaged, evangelizing customer for you, there's always going to be that escalation of investment. The beauty of what you can do with technology--I mean, this is not a technology kind of strategy. It's just a strategy that leverages technology to automate the kind of stuff that is always a best practice. It's just you couldn't always afford the time to do it, unless you were selling something that's really expensive.

Steve: Danny, as I go through the book, some patterns kind of emerged, as I was reading. One of those patterns was get really, really focused and clear about whom you're trying to reach and what you're trying to accomplish. In other words, have a clear picture of the goal. You alluded to that earlier when you're talking about getting clear on who your customer is.

One of the things that I find very interesting--and I've watched you do this as you built your audience--is I think the kind of silent importance of networking with other people; in a lot cases, networking with other people who you might perceive as competitors. Now, a lot of businesses will think online marketing and they're thinking, "Okay, I've got to be on social media and I've got to make all these posts and blast these messages out." Or, "I've got to buy pay-per-clicks ads," or do this or do that.

But really, as I've looked around and studied the people who've been very successful at building large audiences and getting a lot of attention, they do it the old-fashioned way. You're picking up the telephone and talking with people. You're building a relationship with other people who have audiences. How has that process worked and how does that fit in the kind of overall scheme of audience building?

Danny: In a few ways. Fundamentally, the first thing you've got to remember is that people generally connect with people. It's much easier to connect with another person than it is to connect with some amorphous brand. You can do it. Apple did it. But it's a lot easier to connect with a person.

There's a psychological phenomenon. I don't know if it's the halo effect or something else. I confuse these two. But the way that it expresses itself in behavior, is that if I'm talking to someone and I tell them that I think you're an idiot, the fact that I am saying that about someone else, makes them think that I am an idiot. If I'm talking to someone else and I tell them that I think you're great, the fact that I am saying that about somebody else, is going to make them think that I am great.

So the kind of sentiments that you're putting out there all the time, is what people will associate with you. Connect with the people who really are great. Let their level elevate you. You work on elevating them. Teach them. Help them. Work together. There's a lot of room to collaborate in just about any kind of market.

Let's go with the hardware store example. I have a hardware store. You have a hardware store two blocks from here. One would think that we're pretty direct competitors. I don't want anyone to know about you, because the more they know about you, the less they're going to buy from me. But what if we get together to put together some public event where we teach people how to do home repair? We're both going to put on workshops. Yeah, you'll make some sales out of that event. I'll make some sales out of that event.

But what we get out of it is a general population that is much more empowered and aware about what they need to do to fix up their own home. So they're all likely to spend more money. So you grow your market size. You're one of the people that organized this thing. You're the one that explained it to them. So you're the obvious person to come to with their questions. And you're a hero in the eyes of your colleague as well, because you just grew your market and did the same thing for him.

Steve: For most businesses, if they really look at their competitors, there are places that they don't overlap. The fact that they are avoiding promoting one another in those places is really leaving I think a great opportunity on the table in most cases.

This podcast--this series of interviews--is a great example. I'm interviewing you. You and I do very much the same thing. We consult with business owners. But we each have different strengths. By sharing with an audience, we both benefit. There are a lot of ways to do this, especially for folks who get paid for what they know. Because very rarely do two experts have identical expertise, have the exact same domain of experience and knowledge.

So there are always opportunities where you can combine. In doing so, as you said, you explode the size of the market. You multiply it. I see a huge advantage in doing that. But very few people see it. Very few people see it and take advantage of it.

Danny: Which is unfortunate. I'll two things to what you just said, which is, you said that this is the case for most people who are selling what they know. What I'd add to that is that most of the people who are selling things that are not what they know, they are still selling what they know.

We can come back to the hardware store example. The guy is selling hammers and nails. But it's his expertise that guides me in how to use them that makes me trust him and buy from him. The second thing is that you don't even need to have expertise that other people don't have.

Let's say, hypothetically speaking, that Steve, your expertise and skill set is exactly identical to mine. Right? Which is unlikely, because we're different people. The odds of that happening is very rare. But let's say that we're exactly the same in every way. You still have your personality and style, and I have mine. You can have the two hardware stores, and one of them, the guy is very hands-on and very friendly and will explain things to everyone who comes in the door. The other guy is also helpful, but not as direct. He gives people more space. Some people prefer this style. Some people prefer that style.
So in a lot of ways, even if you could in theory serve these customers, the business that you're supposedly losing is business that you never had to begin with.

Steve: Saying that and having the courage to live it, I think, are two different things. I think in a lot of cases, you get folks who are afraid of losing any business. They have an attitude that anybody with a heartbeat and a wallet is within their market. That's often the hardest and most expensive way to grow a business.

Most of the time, in fact, I haven't found an instance yet with any of the companies that I've worked with, where we couldn't shrink the size of the market and get very focused, and actually let that business do much, much better with less work, with less headaches, because they were serving a very specific group of people.

You and I will sit here and say, "Well, that's Marketing 101." But in a lot of cases, that's a novel idea for folks. With what you explained with the experts that you have in the book, I just see that theme over and over and over again: get focused, get focused, get focused as the route to building this audience.

A couple of other things that came out as I read through the book, is the importance of building an e-mail list. I know that's sort of blocking and tackling, but a lot of folks aren't doing that right now. I think that's really critical. You've got to have a way to reach out to your audience. If you're going to scale the building of this relationship, you've got to have a way to get to them.

I believe that e-mail is one of the most personal forms of communication that we have today. Probably, a third, you've got one-on-one telephone, and then I think a third is probably e-mail.

Because with e-mail, you can get to places that you just can't get otherwise. You get past gatekeepers. You get people at home on the weekends, on their iPhone. You get into their personal space. So that was one of the things that I heard over and over again as I read the book, from the experts that you had contributing to the book.
Then the fourth point was to pay attention. I'd like for you to talk about that a little bit, this idea about paying attention. As I read the various stories from the contributors to your book, they mean literally pay attention to folks, not just see what the audience is doing.

Danny: Yeah. I would say the same thing. The way I started is by saying that there isn't enough paper in the world for me to make a list of all the brilliant ideas that people think I'm a genius for having, that were not my ideas. I was just paying attention and saw something cool happening. I was like, "I'll try that." I give credit where credit is due. I don't pretend those ideas are mine when they're not. But just by paying attention...

You don't have to be some kind of marketing or business superstar. Just pay attention to what is working and what is not in your own business, in other people's businesses. See what people are actually responding to. See what is resonating well with people. See what is grabbing their attention. See what is grabbing yours. Just learn from all the things that are all around you. You can be phenomenally successful, like unbelievably so. You know this and I know this.

When we're doing the marketing to consulting, there are definitely situations when people will come to you with a question that they are just not... it requires expertise that they don't have, right? We have the expertise. We answer their questions, and that's great. But there's also a lot of cases where people come to us with questions, and you just turn the questions back on them. It's kind of a Socratic dialogue where you guide them to ask the questions that they should be asking, and reach the answers themselves. Is it valuable? Yes. Do they get a valuable outcome out of it? Was it worth their time and their money? Absolutely. But could they have figured it out on their own if they just asked those questions to begin with? Yes, they probably could have.

Just pay attention, because there's so much great stuff happening all around you all the time, particularly with your audience. The beauty of having an audience and aggregating an audience, is you get all these live, rich, instant feedback from real people about all the things you're doing. You don't need to put together a product and a launch campaign and wait until six months later to see what's working and what's not. You can get instant feedback on everything you're doing before you launch anything, to see what people like, what people don't, what they're responding to, what they aren't, how you should tweak, how you should adjust.

I can say, right off the bat, one of my most profitable offers is a training that I never intended to develop or sell. It's something I was doing just for myself as a practice. So many people e-mailed me and asked me, "Explain how you do this." I was like, "Okay, fine. I'll put something together." It became this enormously profitable offer. I didn't have to have a great idea. I just had to listen to the great ideas of other people who were e-mailing me every day. That's the beauty of having an audience.

Steve: I was reading Copyblogger not too long ago. Brian Clark talked about how that business evolved. It has become a fairly large business, and all driven by the audience. He started building the audience first. The audience told him what they needed, and he offered it. It's a very low-risk way to start a business, and it's a very low-risk way to grow a business. I think that's a very good point.

I want to give you the opportunity to do two quick things. One, share any final thoughts that you have. Two, explain why they call you the Freddy Krueger of blogging.

Danny: [laughs] All right, I'll do the Freddy Krueger story first. Then I'll share some closing thoughts here. In 2011, when I was first establishing Firepole Marketing--my brand--as kind of a player to be noticed, I did a lot of that initial outreach and promotion through guest posting. That means, that I would write a post that would run on somebody else's blog, kind of like writing an article and submitting it to some larger magazine instead of just publishing it on my own newsletter.

I did an awful lot of that. I wrote 80-something guest posts in one year. I started getting a reputation. The posts started going up all the time in all these different places that a lot of the same people were reading.

Pretty soon, this one guy, Eugene--who is actually a mutual acquaintance of Steve's and mine right now--he started leaving comments on a lot of these posts saying, "Wow Danny, it's like you're Freddy Krueger. Wherever I turn, you're there." It just stuck. That's it. I became the Freddy Krueger of blogging.

Steve: You alluded to a product that you offer earlier. I assume that's your guest posting product that came out from that.

Danny: Yeah, that's right. It's my guest posting and writing training called "Write Like Freddy," which is a total play on that. If you had asked me at the beginning of 2011, "Write Like Freddy," would you ever think of that? I'd have been like, "Who's Freddy?"

Steve: When we met--I think it was mid-2011--and you were kind of in the middle of this process. I kind of put you on my radar. It's just been really interesting to watch you build a very large and vibrant audience. If folks go get the book--and I know in a minute we're going to tell them how to get a copy of the book for free--and you've got people like Guy Kawasaki in the book, Brian Clark... celebrities are in this book. To think that you started from scratch like everybody else a little more than a year ago at the time we're recording this.

Danny: No, pushing on two years.

Steve: Pushing on two years. Sure.

Danny: But yeah, let's say January 2011. January 2011 was like ground zero.

Steve: So we're a year and nine months away from that. It really is, I think, a testament to what can be done with focused effort in a fairly short amount of time. It's been great to watch. Any final thoughts?

Danny: The final thoughts I'd like to leave people with is I guess two things. The first is that, whenever you guys are talking about marketing, specifically around the online space, social media, all that kind of stuff, people get caught like deer in the headlights. All the flashing lights of--there's Twitter, Facebook, AdWords, Pay-Per-Click, SEO. All the acronyms and technologies go on and on.

Audience building is not about any of that. It's about recognizing that the people you're trying to connect with, ultimately, they are people. They will respond the way that people respond, and you want to connect with them in a way that people really connect. It's worth doing.

We haven't talked about any kind of specific metrics. It's not just about becoming the rock star in your industry for the hell of having 10,000 people following what you're doing. But the more engaged that audience is, the more they're invested in what you're doing, the more profitable each and every one of those customer relationships are.

I didn't build an audience just for the hell of I want to have a lot of people read my e-mails. We went from zero to a very fast-growing, multiple six-figure business that employs a whole bunch of people. It's by virtue of the relationships that we built with the audience, with the people that are following us. It's powerful, it's profitable, and it's sustainable, because next month, the audience doesn't just disappear. It provides us enormous amounts of stability and security to a business that otherwise wouldn't really have it.

Which is why, I strongly encourage everyone to think along these lines. It's not about how you're going to make sales tomorrow. It's about how you're going to future-proof your business in the coming months and years.

Steve: I want to thank you for being on today, for sure, and for sharing what you've shared. I think it's important information. I'm glad we have this opportunity to talk and to get it out there. Now, folks can get a copy of your book "Engagement From Scratch!" You want to tell them how they can get that?

Danny: Yeah, sure. You can go to Amazon. You can pay the $15 or $20 or whatever it is. It's certainly worth it. It's got 90-something five-star reviews. It's one of the top 20 best-selling marketing books on Kindle.

But you don't have to do any of that. You can just go to engagementfromscratch.com. I'm sure Steve will share a link somewhere near wherever you're listening to this. You can just go download the whole thing, all 241 pages. Nothing missing. It's not like download two chapters and buy the rest. You can download the whole thing completely for free.

Once you do that, reply to anything that you get from me, because I'll send you a bunch of bonus and cool supplementary content, too. Say, "Hey, I heard about you on Steve's podcast." I'd really love to connect. I appreciated this or I appreciated that or I didn't appreciate that other thing. Or, "I'm wondering about this marketing question for my own business."

I'm really happy to connect and engage with anyone, regardless of whether you buy anything from me or not. That really doesn't matter to me. I just hope you grab my book and enjoy it. If there's something I can do to help you based on what you read, I'd love to connect.

Steve: That sounds great. I encourage everybody to go get a copy of the book. We'll put a link both in the show notes and on stevegordonmarketing.com. Or you can find "Engagement From Scratch!"

Danny, thanks so much for being on today.

We're out of time. I want to thank everybody for listening in. If you found this valuable, please jump over to iTunes and give us a rating. You can get directly to our podcast by going to stevegordonmarketing.com/itunes. Leave us a rating and help some other folks find this. Hopefully, you found it a valuable resource. Goodbye everyone.