Driving free leads versus getting even a dollar from someone are universes apart.

There is a concept called the “penny cliff”, where product companies who offer their stuff for free assume that they can get nearly the same number of subscribers at $1 a month or even $10/per month.

Turns out that the distance between free and a penny is greater than from a penny to $10/month– because the psychological cost to decide to buy (no matter the price) is nearly the same, whether a penny or $10.

Free is not a good proxy for sales unless you’ve tested small paid offerings against that same audience.

Since if you don’t have the right audience, no amount of testing will overcome this.

And that’s why we shouldn’t make big bets without testing via the Dollar-a-Day strategy or against lists that we own.

I saw a successful entrepreneur last week sign a $900,000 deal to buy traffic without having a product for sale nor making sure the audiences were even a fit.

It’s a massive bonfire of money– spectacular to watch, except for the poor guy who invested the money.

You can’t make chicken salad out of chicken shit-ake– so test first, then scale up.

Dennis Yu

Dennis Yu is a former search engine engineer who has spent a billion dollars on Google and Facebook ads for Nike, Quiznos, Ashley Furniture, Red Bull, State Farm, and other organizations that have many locations. He has achieved 25% of his goal of creating a million digital marketing jobs because of his partnership with universities, professional organizations, and agencies. Companies like GoDaddy, Fiverr, onlinejobs.ph, 7 Figure Agency, and Vendasta partner with him to create training and certifications. Dennis created the Dollar a Day Strategy for local service businesses to enhance their existing local reputation and make the phone ring. He's coaching young adult agency owners who serve plumbers, AC technicians, landscapers, roofers, electricians in conjunction with leaders in these industries. Mr. Yu believes that there should be a standard in measuring local marketing efforts, much like doctors and plumbers need to be certified and licensed. His Content Factory training and dashboards are used by thousands of practitioners.

View all posts