Hey everyone, Sam Ovens here, and welcome to this module, called The VSL Overview &

Math. In this video, we're going to cover the high level view of the VSL funnel,
how it works, and all of the different parts that make it up. We're also going to
cover the fundamental math that makes it work, and that allows us to use this
funnel to buy Facebook ads, and turn those ads into paying clients at a profit.
Very important things here to understand that system, and to also understand the
math, so here's what we're gonna cover. We are going to go over what it is, and why
we use it. Then, a high level view of how it works. Then, the fundamental math that
drives it. Then, we're going to go over measuring and tracking performance, so I'm
going to show you exactly how to measure the performance, and track it. I'm gonna
give you a tracking sheet you can use. Then, finally, troubleshooting issues. I'm
gonna show you different issues you can experience, and if you do experience those,
what is causing them. Let's jump right into it. The VSL funnel, what is it and why
we use it. The VSL funnel is the funnel that we start with, because it is the most
basic, and it generates the fastest results with the least amount of effort, time,
technology, and cost. When we first get started, our number one objective is to get
quantity. Your first objective with paid ads is to generate a sufficient volume of
clicks, leads, strategy session, applications, and calls. Once we achieve enough
quantity, then the poles shift, and our number one objective becomes getting
quality. Once you've got your ads and funnel tuned, and producing sufficient
volume, your priorities change, and quality becomes more important than quantity,
because you're limited by time. This is why we start with the VSL funnel. Because,
it's the perfect funnel to get started quickly, and generate volume. Now, let's
have a look at the high level view of the VSL funnel, and how it works. It starts
with Facebook ads, and then we drive people to a landing page, then they opt in.
Then, they go to a value video, and then a calendar, and a survey. Then, a phone
call, which is our strategy session, where we use our conversion script. Then, they
become a customer. That's how it works. If you want to view a live demo of it, you
can go to not [Link]\casestudy, but [Link]\casestudy. Here's the
URL on the screen right now. [Link]\casestudy. When you go here, this is
the landing page. I'll walk you through the different steps. This is the landing
page here. You enter in your email address, then you watch the VSL. Then, that his
this next step, so we've gone from a Facebook ad, to a landing page, to the value
video. Then they click here to apply. They schedule with ScheduleOnce, and then
after this, we'll show you this. Then they enter in their mobile number, and then
finally they complete the survey. Then, after they complete this survey, they go to
a success page, which would look like this, bam. That's the basic high level view
of how it works. Then after they've gone to the success page, it sends them emails,
which is what the marketing automation software and everything does, and we're
gonna cover that in the next module called, VSL Pages & Automation. Then, they show
up at the time that they scheduled, which should be within four days. Then, when
they show up we take them through the ultimate conversion script, and we should be
converting at least 20% of the people we have calls with into customers. Bam, that
is how it works. If you want to see that funnel, it's [Link]\casestudy.
Now, the VSL funnel, the fundamental math that drives it. Now, that you know why we
use it first, because it's low cost, fast, and it produces lead volume, and call
volume. Now, let's talk about the math that drives it. With Facebook ads we should
pay about two bucks a click, and then our conversion rate with Facebook ads should
be in between 0.5 and 1% click through rate. Which means, we pay about 1 to $3 cost
per click. That's cost per link click. Then when they come to this landing page,
that means that 20% of them should convert. That means if a 100 people come to this
page, 20 should enter in their email address. That would give us a cost per lead of
5 to $15 CPL. Then, they watch the value video, and because 100% of the people that
opt in land on the value video, it's just the same thing. Whatever our cost per
lead is, is our cost per viewer of the video. That means that if we had 1000
clicks, that means that if our landing page converter at 20% would get 200 leads,
that means that 200 people are gonna watch the value video, right? Then, our value
video should convert people to our scheduled strategy sessions at a conversion rate
of 5% or more. That means, if 100 people view the video, then five of them should
complete a survey. That means that we're getting surveys, cost CPS, at a rate of
$50 to $300 per survey. That's when they fill out the survey. Not just the
ScheduleOnce, but fill out the survey as well. ScheduleOnce and survey. Then, we
have a, we look at the surveys, and we disqualify some people, because it doesn't
look they're a good fit. We should disqualify roughly 10% to 20%. Then, you might
have 10% to 20% who don't show up. You didn't disqualify them, but they don't show
up. It happens. That means that about 70% of the people that schedule, and will
actually show up in the end. That means that there's some leakage here. If we're
paying 50 to 300 cost per survey, our cost per call would be about 60 to 360,
because it goes up a bit. If we had 20 surveys, we might only do 14 calls. If it
was 100 a survey, then it's gonna be about 145 a call. That's normal. Then, we do
our calls with them. We go through the ultimate conversion script, and we should
convert 15% or more, call conversion rate. It can be up at 20, but when you're
doing the VSL funnel, and especially when you're starting out, 15% is probably more
like it, and so I've decreased this number from 20 to 15, just because I don't want
people beating themselves up thinking, why am I only converting at 15? If you're
just getting started, and you're using the VSL funnel, it's fine. As you get more
practice, that'll lift above 20% with the VSL funnel, and then later on when you
have practice, and you graduate to the JIT webinar funnel, that'll go up even more.
That means that, if we're acquiring customers in between $300 and $1800 CPA, cost
per acquisition. If we spend $2000 on Facebook ads, and we get 200 leads at $10 a
lead. That means we get 200 value video viewers at $10 per viewer, and that means
we get 20 surveys at $100 a survey. But, then only 70% of them actually turn into
calls. We have 14 calls at 145 a call, and if we have a 15% conversion rate, that
means out of the 14 calls we do, we get two customers. If we get two customers, and
we've spent two grand on ads, that means we're paying about 1000 to customer. If
our price for our program is between 3000 and 6000, that means if we're charging
3000, and we get two customers at 3000 each, that means we made six grand from
investing two grand. That means we got a 300% ROI, or a three to one ratio. If
we're charging six grand, that means we made 12000 off spending 2000, and that
means that we've got a 600% ROI, or a six to one ratio return. That's how this
works. Now, let's talk about measuring and tracking performance, when it comes to
the VSL funnel. Because, now you know the math, but how do we actually measure this
thing, and how do we track it? Well, I've created you a Google Doc that you can
use, and it's called VSL Funnel Tracking. To help you track this funnels
performance, I've included a spreadsheet called VSL Tracking Sheet. It's available
for download beneath this video in the resources section, and you can download it.
It's an Excel file, but then at the top it there will be a link to open it in
Google Docs, and I recommend using Google Docs for this, not the Excel file. This
is what it looks like. Once you have opened it up inside Google Docs, then you want
to click file, make a copy, and save a copy of it to your drive, so you can edit
it. Now, the first thing to note about this is that, down at the bottom we do month
by month. Here's Jan, Feb, March, right? Now, let's say it's Jan right now, where
you can start at Jan. But, if it isn't that, well, you want to just edit that to
change it to the current month, and you can just go along like that. Then, you can
see we've got the days of the week here, and then we've got the dates, and then
we've got ad spend. That's how much money we've spend on ads, impressions, reach,
relevance. Then, we've got CPM, clicks, CTR, CPC, leads, landing page conversion
rate, cost per lead, surveys, value video conversion rate, video conversion rate,
and then number of calls that we generated from the surveys, and then our show up
rate. If we had one survey, and we had one call, that means that our show up rate
is 100%. Our cost per survey, if that's $100, that means that our cost per actual
call is $100 too. Because, we have no leakage here. Then, units is the number of
customers you get, or the number of clients you get just as a count. If you got
five customers, that's units five. But, then we track revenue and cash. Then,
you've got your call conversion rate, CC, and then your lead conversion rate, which
is how many of the leads that you got, did you convert into customers? Then, we
have revenue, and cash. Now, revenue, this is where so many people screw this one
up in every single business, right? In business you've got revenue, and you have
cash. What revenue is, is that's sales made. Let's say that I sell Uplevel
Consulting to somebody, now it's 5800. Some people might pay 5800 up front, most
people do. That's 5800 revenue, 5800 cash, right? But, some people might want to
split that over three payments
of 2000. Now, if they do that, then revenue is like 58, revenue would actually be
six grand, and cash would be 2000. Now, it's important to measure both of these.
Why? Well, because we don't just want to measure cash, because really, if we sold
something that's 5800, and it's on a payment plan, we really made 5800, but it's
just gonna take a little bit of time to collect it. But, we only collected two
grand in cash, so we need to keep a balance of both of these things. The big place
where most people get caught here, is that you can only pay your expenses, you can
only live day-to-day, and you can only pay Facebook ads and everything else with
cash. You can't pay them with paper, which is revenue. Because, of this, you can be
profitable on revenue, but going bankrupt fast on cash, and cash is king. Cash is
the only thing that matters, so we need to track both. Because, we want to make
sure that our cash collected is always greater than what we spend on ads. That way,
we want to make sure our cash flows are always positive. Crucial to advertising. If
you want to spend big dollars on ads, and make a lot of money, you need to be
acutely aware of cash. Then, you've got your CPA, that's your cost per acquisition.
Then, we have two P&Ls. P&L stand for profit and loss. We have a revenue P&L, and a
cash P&L. We have a revenue ROI, and a cash ROI. Right, so we track all of these
things. Nobody does this, it just changes the game when you do this. If we spend
100 on ads, and we get one customer, that means our cost per acquisition is 100
bucks, all right? If that customer gave us 5800 in revenue, but we spent 1000 on
ads, that means our revenue P&L statement is 5700, because we collected 5700 in
revenue, but then we had to pay 100 in ads. But, then you can see our cash P&L is
different. Because, we collected two grand in cash, but had to pay 100 in ads, so
it's 1900. Now, as you go, like this will go, these two things will move, your
revenue P&L and your cash P&L, and your revenue ROI, and your cash ROI. Here you
can see I made a 5700% ROI on revenue, but only 1900% ROI on cash. Now, cash is the
main one. You have to be at least like 20% positive on cash to really survive.
That's the key metric. All of these people talk about LTV, and all of this
bullshit. LTV is a load of crap. It's great, but who cares if you're gonna collect
a hundred grand off a customer over 10 years. You have to survive those 10 damn
years, right? If you have cash deficit in the short-term, then you aren't gonna
survive, you're not gonna be alive to collect the LTV over the long-term. I don't
care how many people say LTV is the metric. None of them know, because you can't
spend a lot of money on ads, and you can't grow really fast, unless you're cash
flow positive on day one. That's why these numbers are crucially important. All you
have to do is fill in the white ones, and these gray columns automatically
calculate. These ones auto calculate. You only have to fill in these. Now, you get
your ad spend, impressions, reach, and relevance, you get all of that from
Facebook. I'm gonna show you that in week six, when we cover Facebook ads. You'll
get your clicks from Facebook too. Then you get your leads, you want to look in two
places. You want to look in your marketing automation tool, which will be
Infusionsoft or Active Campaign. I'll show you that later. You also want to look at
Facebook, but you should trust your marketing platform over what Facebook tells you
to report this number. Surveys, well, you'll know how many surveys you get, because
you get emailed them when they complete them. Calls, well, you should know how many
calls you have, because you do them, and you track them. Sales, you should know
this, Stripe should tell you, also you should keep a tally of this. Revenue, you
should be able to calculate this based on what you sold it to them for. Cash is how
much you actually collected with Stripe, and the rest auto calculates. Now, we'll
cover this in more detail in week six, when we get into the actual advertising and
everything, but this is a quick overview of how this thing works, and how we track
the key metrics. Now, let's talk about trouble shooting issue with the VSL funnel.
With the VSL funnel, the first place we want to look is on the ads. The first place
you can have trouble is, I'm not getting enough clicks, I'm not getting enough
traffic, or I'm getting clicks and traffic, but it's to expensive. You want to make
sure that you've got a click through rate that's at least .5 to 1%. You should be
paying in between $1 and $3 cost per link click. If not, then your audience is out,
your audience is not good enough, or more likely, your message is not resonating
and sticking a nerve with that audience. We'll cover how to troubleshoot this more
in week six. The second chain link down the line is, the landing page. You should
be getting a conversion rate of 20% or more. If you're not, then it means that your
landing page most probably isn't relevant to the ad. You want to make sure that
your landing page has the same message as your ad. You also want to make sure the
technology that's making it work, works well on desktop and mobile. You want to do
a thorough test. The next chain link down the line is, the value video. It should
be converting at 5% or more. If it's not, then it's not resonating with them, and
it's not striking a nerve, and the messaging needs to be adjusted. Then, we've got
the calendar, and the survey. Here, you should be getting people to complete the
survey and all of that. That's pretty straight forward, pretty simple. But, you
should be getting at least a 70% show up rate. If you're not, you may either be too
harsh one disqualifying people, or you might, your show up rate might not be good
enough, because you might be accepting calls that are longer than four days from
the current date, which is a big no-no. Or, you might not be disqualifying people
that you should be disqualifying. Then, on the call, you should be getting a
conversion rate of 15% or more. If you're not, chances are you haven't practiced
enough. If you have done 100 calls, then you're not gonna be that good at it, so it
takes practice. Then, that brings us, that's pretty much the whole funnel, and
that's why I like it. It's nice and simple. It's easy to troubleshoot, it's fast to
build, and it's a very predictable machine. I've included a cheat sheet available
for download beneath this video, and it's called the VSL Funnel. To learn more
about it, how it works, its pros and cons, and when to use it, you can refer to
this cheat sheet. I'll pull it up so you can get a look at it. Here this is what it
is. There's a live demo link here. When we should use it, we use it first, its pros
and cons. Then, here's the high level view, and all the math that makes it work.
There's some resources as well. Live demo here, for more detail training you can
click here, step-by-step instructions to set it up here, and how to drive Facebook
ads to this funnel. We'll be doing that in week six, or here. Remember, we've also
got the VLS tracking sheet here as well. Those are all the resources that you need
to really understand the VSL funnel, how it works as a system, and as an overall
thing, and the fundamental math that makes it work, and that makes it tick. That's
it for this video. Hopefully, this gives you a lot of clarity on the VSL funnel and
how it works. Make sure that you use that VSL tracking sheet. That thing is the
holy grail of everything. Remember, when it comes to paid traffic and funnels, it's
all about the numbers, it's all about the math, and you want to really track
everything, report daily on that spreadsheet. Because, if you do that, then if you
as me on the Q&A calls and stuff, I can cut right to the heart of the matter, and I
can diagnose the issue, solve it, get you back in the game, get you winning again
real fast. Because, this thing isn't like chance, or magic, or anything like that.
It's a machine, and I know all of the parameters of the machine, and all of the
numbers in the machine. If you just build the machine and track it, any issue you
have, I can fix. That's why tracking is so important. That's it for this video,
thanks for watching. In the next one after this, we'll be doing VSL pages in
automation, where I'm gonna show you how to setup the funnel, all of the landing
pages, the content within those pages, and marketing automation with both Active
Campaign, and Infusionsoft. Thanks for watching.