29. High Profit Presentations: Demonstrating Expertise

TRANSCRIPT:

Welcome to Episode 29 of How To Make More Money, a podcast that helps you get seriously good at the game of making serious money. I’m your host, Kelly Hollingsworth and I’m so happy you’re here. 

Today, we’re continuing our discussion of High Profit Presentations, and specifically the features to aim for that get you closer to a high profit presentation. Even if you don’t hit every one of these targets, just aiming for them helps you hit the bull’s eye with your marketing message. So far, we’ve talked about aiming for a distilled presentation which is simple, clear and potent. It conveys the meaning behind your movement in no uncertain terms. 

We also discussed highlighting the happily ever after, which means shining a light on your prospects internal desires, rather than trying to motivate them. Motivation feels creepy, because it involves you attempting to manufacture desire that your audience doesn’t have. They feel repelled because the entire message becomes about what you want and it’s clear that you’re not helping them get what they want. 

Last time, we touched on our third target, clearing the obstacles. Unless you’re selling something like those crocheted bag dolls my grandma used to make and try to sell, your audience wants the thing you offer, but they have obstacles standing between them and making the purchase. A high profit presentation clears away the obstacles so they can avail themselves of your solution. What’s next. The next thing to aim for is demonstrating expertise. Why? Because as Seth Godin says in his excellent book, The Dip, we all want to work with one person, the person who is the best in the world at the thing we need. 

In this short but powerful book, which I highly recommend you read, Seth Godin writes about how being the best in the world is seriously underrated. There’s one section of the book called, The Surprising Value of Being the Best in the World. In this section, he notes that there are 10 top flavors of ice cream from vanilla to chocolate to butter pecan, all the way down to praline. Of the top 10, vanilla is the best in the world dominating the market at almost 30% of all ice cream sales. Chocolate, in second place, enjoys far less market share than vanilla, slightly more than 7.5% of market share goes to the second place winner. And all other flavors are notably less than 7.5%. 

Sweet, tasty treats isn’t the only place where being the best in the world gets you more of everything that’s good. Seth Godin’s book, The Dip, goes on to ask, “When you’re looking to hire someone, or have critical surgery or even go to a restaurant in a city you’re visiting, do you ask for what’s typical? Do you want to know who is relatively good at this thing that I need? Or do you actually say? Who is best? Who’s the best candidate for the job? Who’s the best surgeon for this problem I have? What’s the best restaurant in the city I’m visiting?” We never asked for the worst, certainly, nor do we ask for the average. When we’re looking for something, we all want the best in the world. 

And the reason I’m telling you this is to highlight the fact that when you show up as the best in the world, your audience will recognize that it’s you they want a need to work with. So how do you do this? How do you demonstrate to your audience that you are the best in the world? You do it by demonstrating expertise. Who is the best in the world? The expert. So now let’s consider a very important marketing question. Is there a difference between who looks like the best in the eyes of the marketplace? And who is actually the best? Yes, most definitely, the answer to this question is yes. It is so easy for the folks who are truly the best in the world, the subject matter experts in all different industries, to fall into the trap where they are unrecognized and uncompensated. They’re the best, but no one knows it. This happens over and over. And here’s why. 

Subject matter experts aren’t in it for the money. They’re in it for the meaning. They roll up their sleeves, they dig into a problem, they want to solve it. In this process, they become true experts, those we could arguably call, the best in the world. And when this happens, it’s often that they become the best because they pay no attention to communicating to anyone that they are the best. They’re focused on being the best, not making sure other people know that they’re good. They’re paying attention to creating the most meaningful transformation in the world, rather than communicating to them the marketplace what they’re up to. As a result, their expertise grows and grows and grows, and the world remains unaware. 

Here’s an example from my own life, picture this. When I was first practicing law, I put my nose to the grindstone and I was figuring some things out that many other lawyers aren’t aware of. I was deep into fine print for hours and hours and hours for weeks at a time. And as a result, I noticed something. I saw that the way some lawyers were using accounting language in a fund’s governing documents made the fund’s monthly returns look artificially worse than they actually were. When I saw this, I realized that by tweaking a few sentences of standard boilerplate, my hedge fund clients could present more accurate returns to their investors. 

In the process, my hedge fund clients would more accurately look better than their competitors, who were using the bad boilerplate that artificially decreased their monthly returns. I’ll try to say this very simply, in case it wasn’t clear. Basically, I found an error in standard accounting language that made a fund’s performance artificially look worse. And by correcting this language, I could make the funds performance look more accurate and better through a more accurate performance calculation methodology. Is this a big deal to hedge fund managers? Obviously, in a competitive market, if your returns are artificially decreased by bad boilerplate, that’s going to hurt your business. It could potentially cost hundreds of millions or even billions of dollars. So my clients got the benefit of this expertise. 

Other hedge fund managers who had other lawyers didn’t even know about this, because I had my nose to the grindstone by being neck deep in all the documents I was writing along with being an accountant in addition to practicing law, I was able to see and correct a problem that most other lawyers weren’t even aware of. But this kind of expertise wasn’t helping the hedge funds who weren’t my clients. It wasn’t out there in the marketplace. So other hedge funds had no way to distinguish me from any other lawyer. Why wasn’t the word getting around? Because like every true subject matter expert, I had my nose to the grindstone, I was figuring some things out. And while I was doing all of this, what were the other lawyers doing? 

My competitors were out schmoozing with all the hedge fund managers. So who was getting all the clients? I had some clients, but mostly, it was the other lawyers who are getting clients. One day, one of my clients who had performed really well that year, called me up and asked me to go to a black tie awards dinner, I flew to New York put on a fancy dress and I went to the event. I happened to have been seated at the dinner next to a partner at a major law firm that does a ton of hedge fund work. I can’t even imagine how much money this law firm makes from hedge fund managers every year. It has to be in the hundreds of millions of dollars. And I was telling this lawyer about this issue, this accounting problem that I had discovered in legal boilerplate. And he looked at me and shook his head and said, “That’s not a big deal.” 

I was floored. I was horrified. I remember sitting there in my fancy dress thinking to myself, why doesn’t anyone know about this? And when they learn about it, why don’t they care? This kind of thinking is a sign, my friends. If you hear yourself asking yourself questions like this, or questions that are even in this neighborhood, such as “how can this be happening????” that is a sign that two things are going on. One, you are an unrecognized subject matter expert. Due to your special expertise, you know something is happening that shouldn’t be happening. You know that there’s a solution that meaningfully changes things for the better. 

Then two, here’s the second thing. The other thing that’s happening is that no one knows what you know, that they clearly need to know, because you do not have a high profit presentation that explains it. Maybe you don’t have any presentation at all that tells people what they need to know that will save them from the non experts who are out there schmoozing and saying the important stuff doesn’t matter while you are diligently figuring out the important stuff that people clearly need to know. 

This exchange I’m telling you about, is one of the reasons I started my podcast for hedge fund managers. When I started it, it blew up because I was telling hedge fund managers directly what they needed to know that their big law lawyers didn’t think was a problem. This was a high profit response to the problem of unrecognized expertise. It took me a while to get to this place. But eventually I got out there in the world with my podcast and I told folks what they needed to know that others weren’t telling them. In this process, I helped them and I made money too. 

Unfortunately, this is a response that feels unavailable to many unrecognized experts because here’s what happens. You see the schmoozers out there schmoozing. When you see it, it feels creepy because, as a true expert, you know they’re not selling a real solution. Often, what they’re selling is counterproductive, and to you, a true expert, this feels gross. You never want to look like a schmoozer. You never want anyone to feel about you the way you feel about the schmoozers. So you hold back, while the schmoozers move forward in the marketplace and the gap between the two of you becomes wider and wider over time. You become more and more of an expert. And they become better and better at looking like an expert. And who suffers from this? You certainly, because what happens to unrecognized experts? In the rare cases where they do get recognized, they still don’t get paid. Here’s a tale of woe that every unrecognized expert will recognize. 

I once worked with an investor, a very large hedge fund investor who allocated money to hundreds of hedge funds. One day, this investor called up a hedge fund that was going unnoticed in the marketplace. And he told the hedge fund manager, “I want to invest with you.” And the hedge fund managers said, “Really?” The hedge fund manager had almost no assets under management and was surprised to be getting this phone call even though he was the best in his sector. He even said, “I’m the best at what I do. But nobody knows.” And the investor told him, “Yes, I’ve compared you to all the other funds in your sector, and from a risk reward standpoint, you’re better, from a use of capital standpoint, you’re better, and so many different fronts, you’re better. I want in.”

That money was the first significant investment this unrecognized hedge fund manager ever received. But when the investor was negotiating his entry into this hedge fund, what did he say? He had already recognized the manager’s untapped expertise. He had already acknowledged, to this struggling hedge fund manager, Yes, you’re the best at what you do. But then, he told the unrecognized hedge fund manager, “Yeah, you’re great. But as far as your compensation goes, I want a deal. I’m the first significant investor you’ve ever gotten. And having me in your fund is worth something.” In the conversation that ensued the investor hammered the hedge fund managers compensation down to almost nothing. This tale of woe illustrates what happens when your expertise goes largely unrecognized. You may put some bait out there in the marketplace, that doesn’t clearly demonstrate your expertise, but few folks will sniff out something valuable, and they will hit on your bait. 

These few folks who do will recognize that you’re an expert, but they’re still going to ask for a discount because there’s no demand for what you do from anyone else. Is this right? Is this fair? On one hand, it doesn’t feel fair. If you’re better at what you do, if you are truly the expert, and you’re paid less for it because you’re just not as good at describing what you do or packaging it in a way that the marketplace understands, that doesn’t sit very well with our sensibilities about what is right and what is fair. Unfairness is a decidedly low profit playground. When something feels unfair, we tend to feel paralyzed and we don’t make money. So let’s take a second and level this playground in your mind. Here’s how I think about it. 

In any market, there are three kinds of experts, those who get paid, those who are underpaid, and those who should never be paid. The first group, the experts who get paid, contains the experts who are recognized for their expertise, recognized for their true subject matter, expertise, and they are compensated as a result. The second group, the expert who is unpaid, this is the person whose expertise thus far is going unrecognized and therefore uncompensated in the marketplace. Then there’s the third group, the expert who should never be paid. The people in this group are the pure phoneys. These are the people who have no true subject matter expertise, but who have developed an ability to look like an expert to the marketplace, Bernie Madoff, I’m thinking of you as I say this. 

So now let’s look at the fairness of paying the first group, do we have a problem with the experts who are truly experts getting paid? No, of course not, they’re experts. They’re getting paid as experts. It’s totally fair. What about the third group? The Bernie Madoff’s of the world? Do we have a problem with these folks getting paid? Yes, they know nothing, they add nothing, they do nothing but take. But they look like experts and for a while until they are discovered, they make a lot of money. And this doesn’t strike as this fair at all. 

In the comparison, though, of these two groups, the true experts who should always be paid, and the pretend experts who should never be paid, what can we learn for ourselves? Where can we find some fairness in this? Basically, what we can glean from this comparison of these two groups is that anyone can acquire the ability to appear as an expert. People who know everything about what they’re doing, can acquire the ability to look like an expert, and people who know nothing about what they’re doing can acquire the ability to look like an expert. What about the group in the moneyless middle, the true experts who thus far are unrecognized and therefore uncompensated? These folks are the only folks who haven’t yet acquired the ability to look like an expert, to demonstrate expertise in the marketplace. That’s the skill that they’re missing. And these folks are the only folks who are not yet getting paid. 

These folks are missing something that the other two groups took the time, money and effort to figure out. They are missing the ability to demonstrate expertise in the marketplace. So is it really unfair that they’re unrecognized and uncompensated? When you think about it this way, it no longer feels quite so unfair does it? To really tap into the fairness of it all, picture this, your subject matter expertise is like a giant above ground swimming pool filled with drinking water, you can spend a lifetime acquiring the subject matter expertise, that’s drinking water in the pool. And in theory, it’s there and available anytime you need to drink. That’s why you go to the trouble of acquiring this expertise. It’s a safety net for the future, it’s there when you need it. But then what happens? 

If you get thirsty, which of course you’re going to do from time to time, this is when one of two things occurs. If you have the ability to demonstrate your expertise to the marketplace, that’s like having a spigot in your hand that you can attach to the swimming pool. It allows you to siphon off your drinking water whenever you need it. If you don’t have this ability to demonstrate your expertise to the marketplace, what happens? Your subject matter expertise remains in the swimming pool, it goes untapped. If you get lucky from time to time, some water may splash out of the pool, and you’ll have a drink. In other words, you’ll make some money. But this isn’t reliable. And it certainly doesn’t happen on demand. And as a result, you feel thirsty, far more thirsty than you have to feel, until you get this problem solved and you figure out how to demonstrate your expertise to the marketplace, so you can tap into it on demand and start getting paid not just reliably but handsomely as well. 

So what I’d like you to glean from this episode is that getting paid as an expert has two components. One is acquiring the subject matter expertise, becoming the best in the world at what you do. But the second component is actually more important than the first. It’s becoming recognized as the best in the world. And this is where most subject matter experts are suffering. They don’t know that being the best in the world has as much or more to do with demonstrating expertise, as it does in acquiring expertise. This is the trap of the unrecognized uncompensated expert. When you’re not getting paid, you think you need to be acquiring more expertise, because when you have more expertise, eventually the world will recognize it and you will get paid. But that’s not the way it actually works. 

The way it actually works is when you acquire some expertise, you learn to demonstrate it to the marketplace and then you get paid and then when you acquire some more expertise, you learn to demonstrate that in the market and your compensation increases. So just know how to find out if you’re in this trap. If you’re in the trap of the unrecognized uncompensated expert, who doesn’t know that demonstrating expertise is as important as acquiring expertise, here’s what it will look like. It will look like you’re a coach who’s looking for one more certification. It will look like being a lawyer, accountant, architect or other professional, who’s looking for one more credential, one more degree, a few more letters to put behind your name. That’s also a sign that you’re in this trap of the unrecognized uncompensated expert. 

Here’s the third sign. If you’re wondering, why in the heck is everyone in my industry doing things in a manner that is clearly substandard? but no one knows what you know, or why they need to know it, you are also in this trap. If you’re in this trap, the way out is not to acquire more expertise. The way out is to learn to tap into the expertise that is already there, that you already have. And you do this by demonstrating that you have this expertise in your high profit presentation. This is the fourth target to aim for in your marketing message. 

What’s the fifth target? To find out, please join me for our next episode. And thank you so much for being here today.