I have never dabbled in the stock markets. I ‘invested’ instead in developing business and practice improvement strategies for my companies and for my clients.
However I do know many doctors who are interested in the answer to ‘what is the best investment that will yield the best returns?’ Let me see if I could present a different viewpoint to you on the subject of making great monies.
During 2008 and 2009 many investors and even people who do not consider themselves investors might have had a grim awakening.
But as the word ‘awakening’ indicates – it is a good thing.
Maybe these next few lines will shade some light on how — if you are interested to have a good ROI on investments — to double your investment over and over and over again.
The very activity which does such a thing (double the investment) is done by all companies in which you have ever invested.
Every company that makes any type of money at all is a phenomenal marketing company.
No matter how good the product is, it is only good because the public perceives it to be good.
And that my friend is the job of marketing.
No matter how good a product is, the marketing has to be at least as good, if not better for the product to sell in large enough quantity.
Even for a product to be created it usually takes money. Money which investors are dishing out.
It takes incredible marketing skill to get that investment.
I smile when I hear, and I hear it often, when someone discounts the success of some young chap who became successful because he got hundreds of millions in funding for the start of his company.
“I could do that too with my product if I had this type of money.” you will hear someone saying.
No, you could not. Because you do not know the most important thing right out of the gate — marketing and sales.
You could not sell your idea, market your idea, and thus even if you would get a hundred million from winning the lottery, you would probably blow it and go bankrupt, just as the people who do win the lottery.
The basic, the very basic of succeeding in business, in arts, in the entertainment industries etc are all depending on incredible marketing skills.
I bet you have seen many movie stars which you like, as much if not better than some of the mega box office guys, who however are small earners compared to the mega stars.
“It’s the marketing — stupid”. As former president Bill Clinton might say.
So, let’s summarize one more time, as this is of significant importance for you to ever make any money to speak of.
No matter which stock you invest in, if the company does not know how to market, you (and them) have had it.
This does not mean that product, service and the right time at the market play no role at all – they do.
But without ingenuous marketing the best product will fail.
One famous example was Coca Cola which had failed several times before the right person marketed it so that it became what it is today. Another example is Red Bull. Red Bull was a failure before someone who knew marketing did the correct actions to bring it to international success.
Even when a product slightly changed — such as adding carbonation to Red Bull – it was still a marketing move.
Marketers know – or find out what is needed and wanted.
By the way, did you know that life insurance was called ‘death insurance’ and under that name it was going nowhere in sales with people?
Some chap came along and called it life insurance (when it really does not insure your life but your death thus the phrase “I am worth more dead than alive”).
Marketing is king.
Now, I did not write this for you to look at which company has the best marketing team but for you to market yourself, your service, your practice as well as other services or products you now do not even conceive of.
Remember Dr Scholl with his shoe inserts and arch supports for the foot.
Most doctors – podiatrists — tell me that his brand of products are no good, cheap and practically useless.
Hmm, I am not getting in the middle of that because I would not know but it does support my point above. Dr Scholl’s company is filthy rich with what his competitors think is an inferior product.
It’s the marketing, stupid.
I wrote this issue to show you how you have the power to double you money every single month – if not sooner – and at the same time create a reputation, trust and professional satisfaction no stock investment can ever do for you.
And – oh by the way, you will make so much money that you can afford to play (and lose) big in the stock market if that strikes your fancy.
Look, if you invest $50,000 in the stock market you will earn at the very best about 10% after one year.
That is a whopping, or should I say, a lousy $5000.
And if you look at what the market was the last two years and probably will be the next two years, then the 10% are anything but guaranteed.
Anything but guaranteed, but even if guaranteed, it will bring so little that the money made would not be worth writing home to mom about.
The money made will NOT – and I repeat – will NOT put your kids through colleges, get you into retirement early, help your kids with your grandkids’ education. And it will probably not be enough to have a vacation and if finances is an issue already, then already not enough to pay the bills.
How many $50,000s do you have to invest so that you can make – let’s say $100,000 a year?
You would need a million ($1,000,000)!
Do you realize that just about all – actually all – doctors I have ever talked to, who are very well-off because of investments in the real-estate and/or the financial markets, have had good growing practices to begin with in order to be able to invest?
So what can you do with $50,000 in marketing money?
First of all, unlike in the stock market you will not need all that money right away, but can spread it out over almost a year.
And in the meantime the money you did put in would already come back in returns and you can (must) reinvest it and soon you will have much more that $50,000 in playing money.
What about if $4000 a month or $1000 a week would bring you back about $8000 in twelve weeks?
That would be a 100% return in twelve weeks. What about if I am very, very wrong (but I am not) and the 100% return only happen after twenty four weeks?
That is $4000 earned in only three to six months with only $4000 invested.
100 % return in 20 weeks is not all that bad either and this ROI will never be accomplished by the stock market.
Now, in order for this to happen you need to invest that $4000 regularly for three months – or let’s say six months to play being the pessimist and giving yourself a safety net.
One of the unavoidable laws of marketing is that you do need to fill the pipeline as we have calculated to be about three months and count six months just to be safe.
Is it not easier to come up with $24,000 over six months (probably on credit card with no more than $900 a month in payments) and get about $4000 back every month at that point than come up with $50,000 and wait for a year to MAYBE get a one-time lousy $5000?
Of course you say, “How do I know that that will happen?”
No, there is no real guarantee, but if you really look around you will find that there is no such thing as a guaranteed thing in life. Most business owners have this as the only guarantee: they are making less money during economic downturns.
- “The economy is bad and people will cut back no matter how much I advertise.”
True too. The pie is getting smaller by as much as 50% in the medical field. Some doctors will have a real hard time but will make it through. The persevering power of doctors is large, as I have observed.
Some however might go broke despite of being good hardworking docs. Whatever minimum amount of service which will be needed and purchased by patients will be purchased from doctors whose names are being talked about by the people in town, endorsed by the media and non-profit organizations, as well as businesses.
Advertising alone is NOT the way to go, but for all purpose any activities which make noise so that you are seen and heard of is better than nothing. Bad advertising (which is not what you should do) is still a better guarantee for making money than the stock market.
- “I have marketed before – I have in fact tried it all (yeah sure) and it does not work the way you say.”
In my seventeen years of consulting doctors across the country, I have not met a single doctor who actually did ALL the marketing he could have done. Many, many have told me that they have done it all. Yeah right! Even the advanced doctors who claim to have done community activities and general public relations have not even scratched the surface. Literally none of them – ever!!
- “I have a high overhead of 90% and thus I need to sell eighty thousand ($80,000) worth of service to make the $4000 marketing money and the $4000 profit as you have described.”
Uh, that is a tough one. I have heard this so many times that I believe it might be as big of a reason, why doctors and small businesses do not market as they should and rather waste their money with weird investments, as simply not knowing the basics about marketing anymore than I know medicine or a man knows what a women goes through during pregnancy.
So, let’s shed some light on how much new business you need to generate to cover your marketing money.
Let’s take the extreme of 90 % overhead as mentioned above. This high overhead is usually not because the costs are too high but because the income is too low. So any dollar you take in more than you do now will have a very, very high percentage of profit on that extra money. You see your overhead will not go up just because a few new patients walk in. Maybe 10–20% of material cost for a dentist for instance might be added on but the other 90% of that newly made money will also be new profit. Thus you will make at least $8000 profit on about $10,000 of new income.
Discount the $4000 you spend on marketing and you are left over with a net profit of $4000 in about three to six month.
I hope that the above explanation makes wanting to make more money rather worrying about cutting cost and saving.
- “Even it would work, I simply do not have money, neither for stocks or marketing.”
It is simple. You do not have money for investments or for marketing because you did not market enough and correctly for a long time.
As Albert Einstein said, “If you want things to change while keeping on doing the same things, you are insane”
Financial duress is no different than bodily illness. All you have to do to get well – or at least get better, is to stop doing what makes you sick and start doing what makes you better.
You do those changes even if they have only a chance of making you better and keep making changes until you have found the best possible cure for your body.
What other choice is there? Staying sick and thus getting sicker? Not a choice!
Business success and finances are no different at all!
It is just not as serious if you are wrong with some expansion plans (marketing, in this case), all you lose is some money. Compare to the area of health: what happens if the treatment you undertake goes awry — a situation which does occur very often if you look at incidences whereby drugs which were supposed to help and yet leading to death and operations which should have worked out but did not?
Go ahead and start focusing on marketing in your business – you cannot help but win big in this investment.
Helmut G Flasch
P.S: Our live teleseminar series is starting for the new year. Here is our latest event to help you start 2010 with a big bang: “How to Attract a Truckload of Internet New Patients in 7 Days or Less”
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Note: Dentists, doctors, business owners etc have hired business and practice management consultants to help increase new patients and customers, to be more well-organized and to have improved customer service. However, there is one area of management which most often never get adequate attention:
