I literally had over a million dollars generated by giving away free stuff through this million dollar sales process. You’ll be able to utilize this for any type of product, whether it’s a physical product, a digital product, membership sites, coaching, if you’re in an agency and you want to sell service, etc.
Even if you are a total new beginner, you will understand the fundamentals of what makes a profitable business and how you can literally give stuff away for free and yet be extremely profitable.
In order to understand how we did over a million dollars by giving stuff away for free, I will first explain the model and how it came about.
When online shopping first started, it’s very common for somebody who wanted to sell a $7 product to create and sell this product at, say, $4 plus $3 shipping.
However, Amazon disrupted the entire thing by introducing something called free shipping and because of this, everybody was really used to paying for stuff and getting free shipping. Thus, free shipping was a term that wasn’t really special anymore.
One of the models that I adopted was a free product, just cover shipping. I’ve actually tested all three models and hands down, by some weird psychological factor, this was the winner.
When you understand the numbers, strategy, and thought process as well as the execution, by understanding these principles, you will avoid years and years of frustration.
I started off with the Free Book and had two upsells, which were OTO1, which stands for One Time Offer one, and OTO2, which stands for One Time Offer two.
Think of it like this, you walk into a fast food restaurant and order a burger. The cashier would be inclined to ask you whether you’d like to upsize it, make it a meal, or would you like fries with that. Notice it only happens after they get your order.
When I start to promote this, here’s what most people who don’t understand would say. They would say, well, clearly this guy is making money off shipping because it doesn’t cost $7.95 to ship a book.
But here’s the thing. The book has 200 pages so it’s pretty big and it’s all fully colored printed thus the cost of printing for this book is actually pretty significant, which comes to about $8. Truth be told, on the front end, I actually don’t make money even though people think that I do.
If I were to ship this to somebody that lives in South Africa, it does cost me about $10. So give or take, I barely break even when I give this book away for free because shipping, printing, fulfillment, and all of that handling, is the real cost.
However, after people claim this book for free, out of 348,000 people that visited, 50,000 people gave me the name and email of which 13,000 people bought the free book, which is about a 3.82 conversion.
Because I have a sales process with an upsell, right after they order the book, I offer them this page that says, “Would you like to be able to get my full masterclass where I give you the assets, scripts, templates, and all of these other stuff that will help you accelerate and get results faster? If so, it’s a $297 upgrade.”
Out of the 13,000 people, about 9% of people would get this $297 offer. Now, this is a glimpse of where I start to make significant profits. But even then, what if I told you that that’s really not where the bulk of the sale is?
The sales that are truly profitable are on the third step, which is OTO2 or the second upsell. What is upsell number two?
The majority of where true recurring passive income is lies in the second upsell. So on the checkout page, it would congratulate the customer for ordering this book.
I am utilizing the free plus shipping product as a way to sell the thing that I actually want to sell. Is it an easy or tough sale?
If I led a conversation with a Facebook ad saying, “Hey everybody, my name’s Peng Joon. Let me teach you social media for $97 a month”, what do you think a person’s initial reaction would be if they don’t know who I am and they’ve never consumed my content in the past? They’ll wonder who I am.
What I’m doing right now is that I’m taking this thing, which is low risk for someone where I barely break even because of all of my costs incurred, but I make the profit on the upsell number one and the real long term recurring passive income on my upsell number two.
We have built a huge list as well, of about 50,000 people, where if I continue to nurture that list and relationship, there could be a point where they will eventually buy when the time is right.
Free plus shipping is not just for books though. You might think this doesn’t apply to me because I’m not an author.
You could be in beauty and the free thing that you give away could be a free makeup brush that you sourced from Alibaba or AliExpress for very cheap, where you can afford to give it away for free, and people just need to cover shipping.
Then after that, you could sell them a full blown makeup course, and it all started just because you gave away a free makeup brush.
One last thing, an average cart value means that on average, that amount is how much a customer is worth to me every time they go through this process.
Every time I give something away for free, which happens to my free book, I actually make $86. Wouldn’t you agree that’s probably a pretty solid business model?
How would you like to be able to make $50 every time you give away something for free?
Understand something, this is not a funnel that I think works well, but it is literally a million dollar funnel. So if you want to have that funnel, check it out.
This is the behind the scenes to a million dollar funnel. Discover the full list of proven numbers of how well this worked for me by clicking here. Let me know what you think in the comments!