98 – How Tim Chermak Quit College, Learned Marketing, and Started a Company that Generates $50k/Month

Tim Chermak

Tim Chermak is the founder of Platform, the digital marketing agency for real estate agents. Tim created his education outside of the school system, consistently invested in himself, and learned valuable skills to build a career and a company.

If you are or want to be an entrepreneur, you’ll love this episode.

Tim shares his stories from getting his first clients as a marketing consultant to shifting his consulting business into a scalable digital marketing company and the challenges along the way.

*The episode includes about 9 minutes of NFL talk, skip from 9:00 – 18:00 if you’re just here for the entrepreneurship.

Also covered in this episode:

  • How Tim starts every morning
  • NFL talk: Teddy Bridgewater, Vikings vs. Lions, Quarterbacks [ends at 15 Min.]
  • Rational Choice and NFL Head coaches and coordinators  
  • Tim’s career path from intern to founder of Platform
  • Lessons learned working as a congressional campaign intern
  • The advantages young people have when entering new industries
  • How Tim landed his first client (as a marketing consultant)
  • Turning a marketing consulting business into a nation-wide digital marketing company
  • The value of raising your prices
  • Writing a book as a sales tool
  • How to double the average webinar attendance rate
  • Learning to work ON your business, not IN your business
  • Investing in yourself, even when you can’t “afford” it
  • Applying social proof to marketing and your life in general
  • Tim’s impact on The Future of School

Links:

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All episodes of the Isaac Morehouse Podcast are available on SoundCloud, iTunes, Google Play, and Stitcher.

My Kid Learned More from Mario Maker than I Did from a Marketing Major

Mario Maker teaches marketing
Image courtesy my iPhone. Weird mustache courtesy Nintendo.

I’m not kidding.  I just watched my kid grasp basic marketing truths that took me years in the professional world to get. (I might be a bit daft, but that’s another story).

I didn’t end up graduating with a major in marketing, but it was my major for several semesters of useless university.  The only things I remember from those classes are the words “target market” with no real context.

That’s just it.  I needed a lived context.

So my son builds these levels on the WiiU game Mario Maker.  He’s posted some of his favorites to the network so others can play them and, if they like them, give them a star.  He checked in the other night only to find two of his favorite creations had been removed from the network because they did not get enough stars in a given time span.

Here comes the pain.  And the learning.

I watched him go through all the stages of grief.  “That can’t be right?!”…”How dare they!!”…”Maybe if I tweak it and change the name I can re-upload it?”…”It’s hopeless.  What’s the point of building levels”…and finally, after a long grieving process lasting almost minutes, acceptance.

Unaware of how enthralled I was with watching this unfold (because I pretended to still be reading) he repeated the entire situation to me, making a point to vent his frustration because of how hard he worked.

“The worst part is, that’s the level I worked on the longest and it was my favorite!  Some of my other levels are just silly and were easy to build, and they have more stars than this one.  I wonder why?”

Big Important Marketing Lesson #1: The labor theory is bunk

Karl Marx and a lot of other confused social scientists with bad beards (Adam Smith gets a pass on this one…no beard) like to claim that value is derived from the cost of production – the amount and difficulty of the labor that goes into it.  This is clearly false, and my son now knows it.

Even if you know this from a (rare) good economics teacher, you probably don’t really know it in your gut and know how to plan around it until you’ve experienced it.  Some of my favorite, most labor intensive blog posts get no love, while some silly Haiku I tap into my phone in a few seconds might get…well, a little more love at least (I guess my example isn’t that dramatic after all, since my readership isn’t that huge…Hi mom!).

This is an important lesson.  Sure, content is king.  Yes, build a better mousetrap.  The problem is that what you think great content and better mousetraps look like mightn’t be the same as what customers think.

There are two potential solutions: the product solution and the marketing solution (best used in tandem).  The product solution is to learn from what people do like and make products more like that.  The marketing solution is to learn what feelings people want to experience when using your product and do a better job of attaching those feelings to it, finding the niche of people who will “get it”, and getting the word out to them.

My son, a very stubborn and independent creative type not keen on compromising his design, immediately went with the marketing solution.

Big Important Marketing Lesson #2: 1,000 true fans, social proof, list building…

This is really a lot of lessons piled into one, but it all happened so fast it was like a single epiphany for my son.  It took me a long time to understand the value of building a “tribe” of loyal fans or customers (Hi mom!).  It took me a long time to see the value of capturing leads, doing personal one-on-one outreach to influencers and early adopters, and touting the real stories of happy customers to help draw in the more risk-averse with social proof.

My son had the epiphany less than ten minutes after his teary explosions during the second and fourth stages of grief.  Here’s how it went down.

He jumped onto some sort of chatroom type thing in the game and posted a question asking if anyone else had been frustrated by having a level removed for too few stars.  In minutes he was conversing with three or four others.  He checked out their profiles and levels.  He followed them.  They followed him.  Then they somehow came up with an agreement.  They would give each other the name of their newest levels and all play each others and give them a star, ensuring three quick stars, pushing it nearer the top of the newly added levels, raising the profile and keeping it from getting removed.

It was late and I was going to bed.  He doesn’t like to be the last one up, so he begged me to wait a few minutes while he dutifully played and starred some of their levels.  He double checked and verified that his new coalition had done the same for him.

Damn.

He went out and talked with people, built a tribe around a shared frustration, collaborated to find a solution, and engaged in what MBA douchebags might call “synergistic strategic partnerships” (I don’t know if MBA’s would actually say that, but I imagine they would and this is my article).  He added them to his followers so that there could be accountability, followup, and future collaboration.

As a dad one of my solemn duties is to always think my kid too quickly plays the victim and doesn’t take things into his own hands.  It’s the kind of self-righteous worry a parent feels entitled to.  Except this time he robbed me of the opportunity to start waxing about how in my day we had to pick ourselves up by our bootstraps and mustached plumbers didn’t get any stars from anybody.

After a brief moment of feeling a victim of the system and being angry with idiot consumers who don’t appreciate good product, he saw his frustration as an opportunity.  Surely someone else felt the same?  Surely there was a way to work around it?  And he did.

He realized that intentions don’t matter, value creation does.  But value creation is not just in the product, but the feeling people have about it, the reasons they have to care, the connection you build with them.  Now even before building a level he preps his loyal allies to reduce the risk and boost the ratings when it is released to the network.  This is what authors do with their emails lists (sign up for mine here, I have another book coming out and you can be one of the early reviewers…you too mom!).

Teachers Aren’t Very Good Teachers

My kid isn’t some kind of special genius.  The world we live in is the most resource, information, and opportunity rich in human history.  If kids freely engage the world and follow their curiosity and intrinsic goals they will encounter a more diverse range of ideas and experiences than we can imagine.  When I try to directly teach my kids this stuff they scoff or sigh or roll their eyes or play dead hoping I’ll go for help so they can finally escape my words of wisdom.

In fact, unless we actively work to suppress it our kids urge to learn, experiment, innovate, create, and adapt will blossom.  That suppression often takes well-meaning forms like direct, mandated instruction from adult “experts” who know almost nothing about Mario Maker or other contexts kids actually care about.  It takes the form of classrooms and textbooks and tests and pressure to careerify interests.  It takes the form of parental worry that if their kid doesn’t learn the same bunch of arbitrary, mostly useless facts they were forced to memorize at the same age they did everything will fall apart and society will crumble.

Relax.  Your kid is going to be fine.  Even if they play a lot of video games.

…………………………………………………………….

Here are a few other examples of learning by doing from my own life:

Why LEGO is more valuable than algebra

How my son learned to read when we stopped trying to teach him

Marketing as Creating

A lot of creative types have an antagonistic relationship with their audience, or at least with what they perceive it would take to have an audience large enough to make money from.  There’s this idea that just creating great stuff is fulfilling but won’t sell, yet marketing yourself to earn more money is selling out your true artistry.

Paul Cantor does a phenomenal job showing the complex, cooperative relationship between artists and the marketplace in his books and lectures.

My friend TK Coleman said something really profound in an email exchange we had with a frustrated creator recently.

“As artists, we not only need to be creative in our work, but also create in how we generate opportunities to do the work. If I’m a painter, then that makes me an artist in two ways: firstly, I have to create paintings. Secondly, I have to create the time, space, and energy to create paintings in a way that’s profitable for me.”

That mindset is powerful, and I think can relieve some of the tension between creating and selling.  It also reminds to be true not only in your creating, but in your marketing.  How you feel about your sales tactics will bleed through, so keep it genuine.

How Nike Supports the Arts

The Kobe Bryant ads featuring Kayne West, Jerry Rice, Richard Branson, Tony Robbins, and others are so amazingly good and have provided me with ridiculous entertainment value. It got me thinking…

I have been a consumer of Nike for years, but I can’t remember the last time I paid a dime for it. I’ve been a huge fan of and benefited greatly from their funny, entertaining, inspiring, and beautiful ads and marketing campaigns, but I haven’t brought a product in a long time. People often worry about the negative side effects of profit-seeking behavior, yet how many stop to ponder the positive side-effects? Marketing doesn’t just convey information about products to potential buyers, it provides free entertainment and art – sometimes truly top notch – to the rest of us and makes society so much richer.

Some of the greatest benefactors of the arts and entertainment are companies that produce something totally different to earn money.

Nike, you never fail to impress with your marketing savvy. Thanks for giving us this free gift!

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I’ve written about how marketing creates value here (one of my personal favorite posts of all time, FWIW), and how marketing is a form of voluntary redistribution from the wealthy to the poor.

Luxury and Voluntary Redistribution

Watching Mr. Selfridge with my wife last night I was reminded of an under-appreciated feature of free-markets.  The wealthy subsidize beauty for the less well-off by patronizing luxury retailers.

Selfridge’s, a pioneer in the development of department stores, is a purveyor of fine goods.  The upper crust are its clientele.  Yet one of the things that made the store famous is available to the general public for free: it’s beautiful and dramatic window displays.  The sale of expensive goods to wealthier individuals is the goal, but thanks to the dollars from those customers and the desire to get more of their business, the store goes to great lengths to display their wares in an appealing and provocative way.  The result is a positive externality for every passerby on the streets of London.

Other luxury items have the same effect.  If you can overcome the urge to envy, you notice that high-end cars and buildings make the world around us more beautiful and enchanting.  Market detractors often fret about negative externalities in a free world, but how often do they account for the immense richness experienced by all, thanks to the wealth of some?

Our sense of life is made up of many things, including the aesthetic environment in which we dwell.  The seemingly extravagant expenditures of the wealthy can create surroundings overflowing with creativity and elegant design.  If you’ve never enjoyed the art of a neighborhood full of houses you couldn’t afford and landscaping you’d never dream of, I recommend taking a drive through one.  Put prejudice aside and let the sensory magnificence seep in.  Humans are amazing creatures who can shape our environs in amazing ways – I’ll be damned if I’m going to let those with nice stuff be the only ones to take pleasure in it!

Marketing Creates Value

Near the end of the classic movie “It’s a Wonderful Life,” George Bailey saw reality in a whole new light. He glimpsed a world in which he was never born and realized just how important he was to those around him. This experience instantly and dramatically changed George’s outlook on life. In a matter of minutes, he transitioned from attempted suicide to pure joy at the fact of his own existence. No material facts changed. George Bailey was still stuck in Bedford Falls. He was still hard of hearing. He was still in deep legal and financial trouble. The angelic Clarence did nothing to improve the external condition of Mr. Bailey’s life, but he saved it nonetheless. He saved it with marketing.

Marketing is often criticized as being deceptive, slimy or at least economically wasteful. How could anyone justify a $2 million dollar Super Bowl ad about a bottle of Coke? Skepticism of marketing springs from an overly narrow and simplistic view of value. In the real world, the line between the real and perceived characteristics of an economic good is all but nonexistent. Our knowledge of and beliefs about goods are just as much a part of their value as anything that can be weighed or measured.

Economists have long understood that value (in the economic sense) is subjective. There is no universal formula to determine how much a good or service or experience is worth, because each person has different tastes, preferences and needs, and each will value things differently with changing circumstances. This means that how we feel about a good and what the good is made of are equally important in determining its value to us—i.e. how much satisfaction it brings. If making a better mousetrap can make lives better, so too can making people feel more confident in their mousetrap. This is not trickery; it’s value creation. Confidence in my mouse trap might help me sleep better at night and enhance my quality of life in a very real way.

We’ve all seen news stories about blind taste tests. They are meant to reveal consumer stupidity and branding smoke and mirrors. I recall reading about customers given a cheap beer and told it was a more expensive brand. They reported that it tasted much better than what they were told was the cheap beer, but was in reality the more costly. When they were told the opposite, the results reversed.

The report was framed as some kind of “gotcha” moment, as if a great hoax had been revealed. Why should these results be surprising? If you’ve ever picked up a glass of milk, thinking it was water, and taken a swig, you’ll understand. Even if you like milk you are likely to spit it out. Your beliefs about what you are consuming prepare your brain and your taste buds for a certain experience. The knowledge you have about what you ingest literally changes the experience of consumption. Try smoking a good cigar while stressed or in a hurry and see if it tastes even remotely similar to the same cigar when you have an hour to kill with nothing on the mind.

They say marketing is all about the sizzle, not so much about the steak. Why shouldn’t it be? Steak without sizzle is little more than raw meat; carrion fit for vultures and wild dogs. Steak beautifully plated and garnished creates more value for the person consuming it. Sight, sound, smell and taste are all part of the experience, and the brain is the crucial interface. Even if you have a purely utilitarian approach to eating and care only for the sustenance, you can’t ignore the mind. What you believe about your food actually affects how much it satisfies you.

My father suffered a closed head injury many years ago which affected, among other things, the communication channel between his brain and his digestive system. His brain always tells him he is hungry, no matter how much he eats. It is a near full-time job to convince him that he is full and doesn’t need any more food—that’s some serious marketing. In fact a great many people without head injuries resort to all kinds of tricks and techniques to convince themselves of the same thing in order to stay trim.

I recall talking to a friend who had no taste for coffee. I convinced her to try a sip only after closing her eyes and letting me describe step-by-step the growth, cultivation, harvesting and roasting process. She admitted that, while she still didn’t love it, she began to enjoy the taste a good bit more and understood why I love it so much. I know of people who can no longer stand the taste of meat because they observed the operations of a meat-packing factory. The meat did not change, yet its taste changed with their knowledge and feelings about it. The value of the product radically shifted with a change in perception.

If marketing makes us love a product more, and therefore makes us happier, it has indeed created value. Love for a new car comes not only because it is red, weighs 2,500 pounds and has four doors—all things that can be measured objectively—but also because it is safe, one-of-a kind, and edgy, all subjective to the person experiencing it. The purely informational role of an advertisement is no more valuable than its ability to make us proud of what we purchase. But how valuable is it?

We can get a rough idea of the minimum value created by marketing in dollars and cents. This does not, of course, measure the subjective value to each consumer, but it reveals how much value consumers placed on the marketing in money terms. If a marketing campaign costs $10 million and it results in an additional $11 million of revenue, we know that it has created more than $1 million in value, as judged by those who willingly spent money on the product. If the campaign made the product more valuable to more people and induced them to buy more or buy at a higher price, that is a reflection of the fact that the consumers felt the product and associated satisfaction created by marketing was worth more than the money they gave up to get it. Real value was created. If it was not, people would not have willingly parted with their money in exchange for the good. Better marketing can often be a cheaper and more effective way of improving a good and making people happier than altering the product itself.

Goods and the knowledge and feelings that come with them cannot be separated. New tile floors and soft lighting may be just as important as variety and good service at a clothing store. An inspiring ad campaign may bring just as much happiness as new features on a smartphone. This is no scandal, but a fact of the human experience of reality.

Rather than denigrate it as some kind of fraud or waste, we should applaud good marketing. Not only does it enhance the value of the products we buy, it enhances our quality of life even when we don’t buy the products being marketed. TV ads are often funny and entertaining. Billboards and magazine ads are sometimes works of art. Good marketing is a free gift to all, and it makes all our lives better. A world without marketing would be dull and far less fulfilling.

Altering our perceptions of reality is one of the best ways of improving our quality of life. It’s powerful stuff. Clarence saved George Bailey’s life with a recasting of the facts, and set him out with a full heart ready to take on the world. The creative efforts of marketers everywhere have the same power to make our lives richer and better.

Originally posted here.