You're listening to the REI Marketing Nerds podcast, the leading resource for real estate investors who want to dominate their market online. Dan Barrett is the founder of Ad Words Nerds, a high tech digital agency focusing exclusively on helping real estate investors like you get more leads and deals online, outsmart your competition and live a freer, more awesome life. And now, your host, Dan Barrett.
Dan: Hello everyone and welcome to this week's REI Marketing Nerds podcast. As always, this is Daniel Barrett, here from AdWordsNerds.com. How are you? First of all, if you are listening to this right now, and you are not in our Facebook group, you really need to get in the Facebook group. Now, I talk about the Facebook group pretty much every episode at the end, but just in case you have missed that, you can go to AdWordsNerds.com/group. That's AdWordsNerds.com/group. You'll be automatically forwarded to the Facebook group. [0:01:12.7]
It is free to join and we are posting trainings, content, guides, strategies, tips, like literally every single day in there and lately, I've been dropping a lot of… I mean, look, this is … you can hear this? That's the sound of me patting myself on the back. It's really good stuff in there lately and I'm really dedicating 2020 to making that group even better. So if you are not in that group, you need to get in that group. I don’t know what to tell you. It's free and it's awesome. So again, AdWordsNerds.com/group. Go there. Check it out. Now, the audio on this podcast is actually from a post I originally put in there and I wanted to share this because this is something I'm very excited about. This week, we're going to be talking about barbell strategies and specifically, how you can apply barbell strategy to your marketing for online motivated sellers. [0:02:09.1]
And this is not a new idea. It is not an idea I made up and in fact, this idea dates back all the way to Seneca The Younger, a Stoic philosopher from who knows when B.C. It is an old idea but I'm telling you, we have started applying this idea within my own business, and I have been really, really happy with the results and of course anything that I do that I find that works I'm going to bring to you so you can use it to improve your real estate investing business. Without any further ado, let's jump in to my talk all about barbell strategy.
Alright, folks. Let's jump into this. This week, what I want to talk about is something that I personally find very interesting. I think about it a lot and it's something that I think is directly applicable to your real estate investing business. Something that you can pretty much start doing right away because it's not so much a specific tactic. This is one of those things, everybody wants to know about tactics. [0:03:05.5]
Everyone wants to know, hey, what's going on in Facebook, what's going on in Goggle, what's going on in YouTube, all this stuff. All this stuff is very important of course, but one of the things that, about tactics like that is that they change very rapidly. They change constantly. Facebook is a great example of this - you are a real estate investor, you're doing Facebook right now, there is a lot that is happening to shut down the kind of advertising that real estate investors have done on Facebook forever, and I'll probably end up doing another video on the changes inside Facebook and everything, but that's all changing very rapidly and it's a situation that's kind of an influx so it's hard to know exactly what's going on. But, one of the things that changes a lot less often is the strategy that underlies the tactics. Right? So if you can understand strategy, you can understand why we are doing the things that we are doing, why we were testing, the things that we're testing, the way that we're testing them. If you can understand those things, you can actually understand the tactics even as they change and you can be sort of ahead of the market in many instances. [0:04:08.5]
So let's talk about barbell strategies. Okay? Now, what is a barbell strategy? A barbell… imagine a spectrum, right, and we have got a picture of a spectrum right here and over on the left and over on the right we have these kind of opposing elements of the spectrum. So let's put something on here. Let's say how someone feels about or thinks about their health. On the left, we have got something I like to call blissful ignorance, which is I don’t think about my health at all. I just do whatever I'm going to do, completely natural. I don’t apply any sort of rational thought process to it at all. On the right, we have got hypochondriac, which is "I worry about my health all the time. I'm constantly thinking about it. I'm constantly looking at all my health stats and I'm obsessing about every single number." So over on the left, we have got blissful ignorance. Over on the right, we have got hypochondria and in the middle, we have got a various spectrum of people and everyone's going to fall somewhere on this line. Right? Now most people, what they want to do is they want to go for Aristotle's Golden Mean, which is kind of you go straight down the middle and you say, "Look, I don’t want to be completely ignorant, but I don’t want to be a hypochondriac, so what I'm going to do is I'm going to down the middle and what does the middle of the spectrum look like?" [0:05:13.8]
Well, it is something like "I try to be healthy, but I don’t obsess about it. I try to eat healthy. I try to go to the gym. I try to do this, but I'm not super obsessed about it." Right? We're avoiding the anxiety that comes with hypochondria while also avoiding the negative consequences that come from completely ignoring our health and that all sounds really good, but the problem with this approach is that being in the center of this barbell, because it looks like a barbell, right - being in the center of it actually gives you the worst of both worlds. You end up getting some of the anxiety of the hypochondriac, right? You have this anxiety that "I'm not really doing enough. Yeah, I kind of know my numbers but I don’t really and I don’t have a great grasp on it so there's this nagging sense that somehow this isn't enough versus you get the …a lot of the negative impacts of complete ignorance because in many times, you are not actually doing enough to change your situation. Right? [0:06:13.3]
Sort of intermittently going to the gym or kind of thinking about your diet or trying to eat healthy often is not enough to actually change the underlying sort of state of your body. We're sort of in the middle of the barbell and we end up getting the worst of both possible worlds. Let's look at this in a different context, right. Let's think about a real estate investor doing their marketing. Okay? On the left, all the way on the left, we have people who don’t do any marketing at all. They don’t think about their marketing. They don’t test it. And whatever. I don’t. I send out a couple of postcards a week and that's all I do. Then on the right, we have someone that is doing way too much marketing. So they're testing every possible marketing channel, no matter what. They're running thousands upon thousands upon thousands of split tests. They're actually doing so much testing and there's so much noise, they actually can't tell what's going on. [0:07:01.7]
Both ends of the barbell. Right? Opposite sort of polar ends of this spectrum where we have the person on the left not doing anything and the person on the right doing too much. Now again, what most investors are going to do is they're going to try to find the mean. They're going to try to find the middle of the barbell and what most people are going to say is, "Yeah. I do some marketing and I test some things here and there." Right? "So I do a little bit but I try not to obsess about it." It's exactly the same as the person in the health example, "I try to eat healthy and I try to go to the gym but I don’t obsess about it." This person in the marketing example, "Yeah, I test some things here and there but I don’t obsess about it." But again, this brings us the worst of both possible worlds. We are kind of testing, but we're not doing enough testing to actually get the improvement and at the same time, we're like taking on some of the anxiety of trying to do it all. So it's not as relaxing as the person who does nothing and it's not as effective as the person who does everything and so we kind of get the worst of both possible worlds and this is the trouble with moderation. Right? The middle of the barbell brings a sense of anxiety that we're not doing enough while not providing enough momentum to actually change our situation. So what is the alternative, if the golden mean is not the solution, what is? [0:08:19.3]
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This brings us to a barbell strategy. The barbell strategy in finance basically says you're making sure that 90% of your capital is very safe and you're using the remaining 10% on extremely risky investments. So rather than going down the middle and trying to find things are medium safety, medium risky, you go mostly just completely conservative, 100% safe and then you take a small of percentage of that and you go all the way to the right and you say I'm going all the way risky with a small percentage of my total capital. Right? The exact percentage can change. It can be 80/20, 90/10 - whatever it is, but instead of going down the middle, you load the ends of the barbell. So again, we're not trying to find the thing that is in the middle of risky and safe, we're taking mostly safe things and then we're taking some things and we're saying I'm going all the way risky on this. I hope that makes sense.
Let's look at it in terms of our health example, okay. So rather than going in the middle of the barbell, which again is like, eh, I'm trying to work. I try to watch what I eat but I try not to obsess about it, what we're going to do is take 80% of our health time, energy, effort, focus whatever you want to call it and we're just going to put it on autopilot. We're not going to think about it at all. [0:10:00.5]
Then we're going to take the remaining 20% of our health time, energy, focus, effort - whatever you want to call it and we're going to focus on improving those things with an obsessive level of detail. Because I'm not obsessing about everything. I'm only obsessing about a very specific type of thing and I'm really only spending a tiny percentage of my time, effort, money, focus - whatever you want to call it, I'm avoiding much of the anxiety if someone is going to be a hypochondriac about everything, but I'm also getting significant benefit in those areas by really massively importing them. Let's think about this in terms of marketing. So let's think about this in terms of REI Marketing. If we are marketing for our real estate investing business and you absolutely should, right, REI is very much in marketing and sales and business at its core. Right? We're spending 80% of our time, energy, budget, whatever you want to call it - let's change this to budget - and we're putting that marketing on autopilot. [0:11:01.8]
We're saying, look I'm not trying to change everything all at once but I don’t want to ignore it, so 80% of it, I'm just going to put it on autopilot. I'm going to let it run and I'm going to let it do its thing. But 20% of my budget, my time, my energy, my focus, I'm going to focus on improvement and/or testing. So I'm going to be trying new channels or I'm going to be trying new ads within those channels. I'm going to be testing new headlines. I'm going to be testing new strategies, whatever it is, even new providers. Right? Working with new people, whatever it is 20%, 10% of my time, energy, budget is going towards those risky things that I'm trying to improve and then 80% of it, I'm putting it on autopilot. What that's going to do is minimize the amount of anxiety and stress that we're taking on while maximizing the total amount of improvement that we can gain. Here's what I mean by that - tiny gains have a massive power to improve your business long-term. So this is a really good example of just 1% improvement every day. [0:12:02.4]
So 1% improvement every day because it's cumulative, can have a massive impact over the course of a year. So what we're trying to do is we're not saying, look, every single thing I do has to work, every single thing I do has to be successful, every single test I do has to win. That's never going to be the case, but by consistently following a barbell strategy what ends up happening is that by the end of the year, you are far beyond the person who tried to stay in the middle of the barbell. Again, you're not taking on a tone risks, but by putting some time and effort and budget and focus and energy and all that stuff into small experiments that have the potential to really make a difference over the course of long-term, you end up way farther along than you would have been otherwise. And the way I think about this, right, is I really think about tinkering. I think about this from a tinkerer's mindset. For most of your business, most of your life, most of your health, most of whatever you're trying to work on and improve and maximize over time, you want to put a lot of that just on autopilot. [0:13:06.2]
We just, we have limited cognitive bandwidth. We just can't focus on everything at once. It just doesn’t work. But if you pick out a few areas where you're like look, I could really have an impact here, and you just tinker with it consistently, you say, I'm going to try this thing and see how it works. Maybe it works. Maybe it doesn’t. Then I'm going to move on to the next thing. I'm going to try this thing and see if it works. Maybe it works. Maybe it doesn’t. Then I'm going to move on and I'm going to try the next thing and maybe this works and maybe it doesn’t. And you do that consistently over and over and over. What ends up happening is that over the period of a year, two years, five years, 10 years, whatever you are looking at, you are going to be much, much further along than if you tried to stay in the middle of the barbell and just try to do a little bit of column A, a little bit of column B, rather than trying to go for Aristotle's Golden Mean, think about the barbell, think about what 80% of everything I'm working on can I just put on autopilot and not think about and what 10-20% can I really focus in on and really try to improve, and that is how you maximize your long-term performance while minimizing your short-term stress, anxiety, disaster, depression, whatever you want to call it. [0:14:18.3]
That, my friends, is the barbell strategy. I hope this makes sense. I hope this useful. Let me know in the comments. Let me know, leave me a…whatever, just leave me a comment somewhere on line. Let me know what you think because I would very much like to see what your take is on the barbell strategy like this and how you can apply it to your real estate investing business because I got to tell you, we apply this at our business and it has been massively valuable. I hope it is the s same for you. Let me know what you think, everyone. I will be talking to you very soon. This is Daniel Barrett, signing off. Cheers.
That's it for this week's episode of the REI Marketing Nerds podcast. As always, you can get more podcast episodes over at AdWordsNerds.com/podcast. As I mentioned in the beginning of this episode, go to the group. It is awesome. [0:15:03.3]
It is free to join. Just click request to join. You can find us, just by searching for REI Marketing Nerds on Facebook or go to AdWordsNerds.com/group. That's AdWordsNerds.com/group. As always, I could not be any more grateful for the people that listen to this podcast every week. It means a ton to me. If you have any feedback or anything you want me to know, feel free to leave me a review or just send me an email. You can find me anywhere. Just Google REI Marketing Nerds. You'll find a million and one things. I would love to see your feedback on the show. It helps me make it better and I would really appreciate it. So let me know, and always, thank you for listening. This is Daniel Barrett from Ad Words Nerds, signing off, and I will talk to you next week.
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