Martial Arts Professional Magazine

Jason Yi, a NAPMA Inner Circle member, who will also be in attendance at the 2008 NAPMA Extreme Success Academy, serving on a panel of experts with other Inner Circle Group members to help you grow your school, is the subject of this month’s Member Success Story.

Jason is a bright, entrepreneurially minded school owner, located in Woodbridge, Virginia, where he has done more than $1 million in revenues for 2006 and 2007 - and all in a moderate-size school!

One of his secrets of success is the use of low-cost Internet marketing tools. Instead of thinking that the Internet is too complicated and only for the big guys, as too many school owners do, Jason has learned that many of its marketing methods have been developed specifically for the small business owner.

Jason reveals the low-cost Internet marketing methods he uses to go where his (and your) prospects are going. According to recent statistics, approximately 70% of people search the Internet for local products and services, not the Yellow Pages.

You can learn much more from this Inner Circle mastermind at the 2008 NAPMA Extreme Success Academy - but you must be a NAPMA member and register at ExtremeSuccessAcademy.com.

Toby Milroy: Jason, give our readers a little bit of your background and the growth of your school, then we’ll explain what it takes to experience similar success.

Jason Yi: I was born and raised in South Korea and came here in 1990. Martial arts was my hobby, but after teaching part time in 1991, it seemed to be the career I always wanted to do. I feel so great, helping young students learn martial arts, and then seeing them change in positive ways. I love influencing youngsters to have successful and positive lives.

I was given the opportunity to take over this school in 1998, so this is the 10^th year anniversary. I teach Taekwondo, Hapkido and Tung Soo. I’ve been very successful the last two years; my annual gross was more than a million dollars.

Toby Milroy: How many students do you teach?

Jason Yi: Currently, there are 567 students.

Toby Milroy: With $1.3 million in revenue in 2007 and 567 students, your student value is very high at approximately $200 per month. How big is your school?

Jason Yi: My current location is 5,600 square feet.

Toby Milroy: Master Yi, your school is a perfect example of why you don’t need a large school - with a large monthly rent payment - to be successful. This is a myth that too many school owners still believe. They think that must have a 20,000-square-foot behemoth facility, with cardio kickboxing and Tai Chi classes and tanning booths, to generate more than a million dollars in annual revenues.

It’s simply not true, as you’re proving. You have a modest facility, teaching traditional Taekwondo, but with a very strong youth program.

During this interview, Jason and I want to concentrate on a concept that is essential to the success of our mastermind group members; and that is there are only three ways to grow a martial arts school, which is also true for almost all businesses.

First, is to increase enrollments; second, is to increase or improve your retention rate, which means, obviously, that the longer students train at your school, the more your school grows; and third, is to increase average student revenue or value per month, per year.

Master Yi, please describe one or two methods you use to increase your enrollments consistently, every month.

Jason Yi: Our school has a prime location in a shopping center, so our number one method to generate leads is walk-ins. During the last two or three years, I realized that I was using the Internet to find local businesses and services instead of the Yellow Pages, and I assumed that was also true for many people in my community.

It seemed logical that more of my marketing budget should be used to create an Internet presence for my school on search engines, such as Google and Yahoo. I started to do some research and learned quite a bit about Internet advertising in Stephen Oliver’s package. Since then, Internet marketing has become my second best method to generate leads.

Toby Milroy: The most recent statistics support your decision and results, Master Yi. In 2006, it was estimated that approximately 62% of American households used the Internet 6 to research product buys. For 2007, that stat increased to more than 70% now.

Tell us a little bit about your Internet presence. There are many techniques to generate traffic on the Internet. What were some of the first steps you took?

Jason Yi: First, you must have a good Web site, which means the content must be prospect-friendly. I made the same mistake that too many school owners have made and that is to create Web sites with descriptions of their schools, their martial arts styles and their instructors’ qualifications and experience. Most prospects don’t care about such information. They want to know the benefits of martial arts and why they should enroll their children or themselves at your school.

“I feel so great, helping young students learn martial arts, and then seeing them change to positive ways.”

The primary purpose of your Web site is to generate leads, so you must educate yourself about how to use it as a marketing and sales tool. Descriptions of your school, style and instructors have their place, but not as the first message prospects see when they go to your site. They want benefits and testimonials from other parents, proving that you deliver those benefits.

When parents search the Internet, looking for a martial arts school for their children, they want to know how a school will teach their children and whether it offers character development, bully avoidance and other important lessons that are not strictly martial arts training.

Toby Milroy: MAPro readers should jot down the acronym: WIFM, which means “What’s In It for Me?” This is the primary question on every consumer’s mind when he or she shops for any product or service, so all your marketing, including your Web site, must answer that question from the prospect’s point-of-view.

Your first Internet marketing secret is to design a Web site to be a marketing tool first, providing benefit statements and other information that speak directly to parents, to prospects. What is your second secret or technique?

Jason Yi: Once you’ve created the right kind of Web site, you must then drive traffic to it. There are two ways to drive traffic to a Web site: free and paid.

Toby Milroy: Let’s talk a little bit about the free version. You use a great marketing tool, Yahoo and Google local. Tell us how that works.

Jason Yi: In most cases, a martial arts school attracts students from a relatively small area. Most of my students come from a three- to five-mile radius of my school. If you did a standard search for a martial arts school on Google, Yahoo or any of the other popular search engines, your results would include schools throughout the U.S. Google and Yahoo, however, include a “local results” list, so if someone is searching for a martial arts school in or near Woodbridge, Virginia, where I am located, they can click on that link and see a listing of just schools in that area.

The Google local search service is free; Yahoo’s cost less than $100 a month, which is very reasonable, compared to the monthly cost of a Yellow Pages ad. There are many other free and very low-cost methods to drive traffic to your Web site. Instead of trying to describe them here, since some are a bit complicated, I suggest that your readers call Google and Yahoo; they have people who will walk you through the entire process.

Toby Milroy: Master Yi, you’ll excuse me, but I want to take the space to be interactive with our readers and ask them to sit at their computers when they read this section. The Google and Yahoo Local free service is such a good idea that I want to provide readers with the exact and very easy steps to list their Web sites.

Go to Google and type the word “karate” and your city, and hit the search button. You’ll see a little map with three, five or more results. If you don’t find your school listed there, then click on the little button, “Know Something We’re Missing? Submit your site here.” You can write and submit a little ad and your Web site for free; and your school will appear on that map in future local searches. Do it now; it’s free; and it will help improve your Internet presence.

One of the methods we haven’t mentioned, Master Yi, is search engine optimization (SEO), which can be a bit complicated to the novice Internet marketer; it’s a topic we could discuss for 10 years. How did you take advantage of the SEO technique, without having to learn it yourself?

Jason Yi: That’s what happened to me! I started to study search engine optimization and quickly decided it was much too complicated. My solution was to hire an expert, a specialist in search engine optimization; someone who already had the knowledge. It was worth the investment.

Toby Milroy: A few of us in the industry, including me, are geeks when it comes to SEO and other sophisticated Internet marketing tools, but your solution is much better for most school owners.

At a basic level, SEO, or search engine optimization, is a matter of including those words or phrase that are most likely to match the search terms of your prospects throughout your Web site. For example, if you’re teaching karate to 7-year-olds in New Jersey, then you should write and create all of your Web pages with those words included as much as possible. As you stated, Master Yi, it’s much more complicated and can’t really be presented here in any detail.

The second method you mentioned to drive traffic to your Web site is paid. This refers to paying Google, Yahoo or any of the search engine services for each click when prospects search for and find your site. As you stated earlier, it’s best to call Google, Yahoo, etc. and allow their representatives to walk you through the process.

Master Yi, tell us about your pay-per-click campaign: how you implemented it, the type of traffic you are attracting and your results.

Jason Yi: I spent approximately $2,100 last year for Yahoo marketing costs, which is a little less than $200 per month. I just took a look at my stats, and 20% of my leads came from Yahoo and Google. I used to pay $700, $800 or $900 a month in Yellow Pages advertising, but that generated less than 5% of my leads for the entire year. When you compare the Web to the Yellow Pages, I generated more leads at less cost.

Toby Milroy: I want to remind all our readers that opening a Google or Yahoo pay-per-click account is not the key to making the Internet a major source of leads. The number one key is that your Web site must convert that traffic into new students very effectively.

Many people may visit your Web site, but how many of those click on your offer; opt-in, or provide their email addresses, to receive your newsletter; or whatever action you want them to take to be one step closer to being a student, a customer.

Some school owners can’t imagine spending $2,100 per year for Internet search engine marketing; however, they must learn to adjust their mindsets to thinking of it as an investment that generates a return.

For example, if, as in Master Yi’s case, you had approximately 600 total students plus or minus, then you probably enrolled 400 or 500 last year. If Yahoo generated 20%, then that is 100 students; therefore, you paid $2,100 for 100 students, which is only $21 per student. Wouldn’t you expect those 100 students to spend hundreds of dollars each, on average, during their time at your school? If each just spent $100, then your gross return is $10,000, with a $7,900 net profit.

Of course, many of our readers don’t have schools with 600 students, or enroll 100 new students in a year. Goggle, Yahoo, etc. can still work for them because their systems allow them to set daily or monthly spending limits.

I repeat, however, that the number one factor is how easily your Web site converts those leads into new students.

Jason Yi: Exactly. Your Web site must be like a salesperson. Your Web site is working for you 24 hours a day, 7 days a week, as a salesperson. Driving traffic to your Web site is only the first step. As you said, the Web site must convince that traffic to click on your offer and give you their names, email addresses, phone numbers and any other information, so you can follow-up and convert them to paying students.

Toby Milroy: That is a very valuable point for all our readers. The kind of Web site we are discussing has only two goals: first, visitors either opt-in, which means providing contact information in exchange for an offer; of two, they complete a form or call you to become a student, immediately. It’s as if you were holding a sales presentation in front of a prospect and asking her, “What could I give you that would motivate you to give me your name and email address?” What’s your opt in offer, Master Yi?

Jason Yi: We offer a free trial class, free uniform and free report about how their child can develop rock-solid confidence.

Toby Milroy: Our best conversion offer at Mile High Karate was a free DVD and report. It costs us approximately $1.50 for the DVD and shipping. Offering a DVD is a great strategy because the respondents must provide their complete mailing addresses, which, of course, are entered into our contact management system, so we can continue to communicate with them.

I’ve never seen a million-dollar-a-year school, such as yours, Master Yi, that doesn’t have great student quality. Sometimes, other school owners have a visceral reaction that successful school owners, such as you, are only in it for the money. There is no way, however, that you can have longevity, nearly 600 students, exceptional student quality, unless your heart is in the right place. I know you, personally; and I know that to be true. Let’s talk about your fantastic internal referral program. It works well because of the great relationship you have with your students.

Jason Yi: To receive referrals from students, you must obviously have a good class or service to impress students and parents. If they are not happy with your services, then they will not refer anyone; therefore, you must start with great service, which is what occurs during a class as well as general customer service. Talk with students and parents as they leave your school after a class. Make a positive comment about the child’s progress or refer to an event in the family’s life, which you might have learned in other conversations. Even go so far as to call a family when you know that the family members might appreciate an encouraging word or a follow-up. Those little customer service efforts are very important in the martial arts business because it’s a person-to-person business. Those kinds of relationships that extend beyond the classroom are critical to a good, successful martial arts school.

I train my instructors, staff members and program directors that service is number one, so they can help me provide plenty of customer service. From the moment new prospects call, we ask for referrals. When they enroll, we ask again. We ask students to bring their friends to our testing day. We ask constantly. We just started a points-for-prizes program, much like a credit card rewards program. Students earn points when they provide referrals or bring friends to events. We use many methods to generate referrals. Every season of the year, we host different activities, such as open houses, buddy nights, etc., and we always asked our students to bring their friends.

Toby Milroy: I think your point about establishing relationships is the key to referrals. There is so much noise in the industry that often the root of the message, your message, is lost. You can have all the referral activities you want. You can have a movie night every week. You can do a pizza party every couple of days, but if your relationships with your students aren’t strong, then you’re screaming into the wind. They won’t want to bring their friends.

Let’s talk about some of the details of your referral program, your credit card program, which is really cool. Tell us a little bit about how that works.

Jason Yi: This was my program director’s idea; and it seemed like a great idea. We used to have referral contests that would last for two months, for example; and whoever brought the most friends and friends that enrolled would receive a prize.

Then, we decided to change to a point system. Students receive a certain number of points for the friends they bring to events. They receive extra points if their friends enroll. A student can earn enough points to win a plasma TV, a laptop computer and other kid’s games and stuff.

Toby Milroy: Let me highlight for our readers that the lesson here is not just that the student is being recognized for his or her referrals (which should motivate other students to do the same), but also your prizes are more family- or parent-oriented than just a kid’s items. In other words, your rewards program should excite the parents, too, motivating them to help their children submit referrals.

We hear from many school owners that host buddy days and they gave X-Boxes as prizes; and that’s cool. Don’t get me wrong, X-Boxes are definitely a good prize for your referral system, but you took it to the next level.

Jason Yi: Exactly, I realized that you could do referral programs two ways. You can do referral programs for kids. You can distribute a whole bunch of good-looking cards, VIP and events cards to your students to give to their friends. Another way is to appeal to parents. These types of prizes attract the parents and motivate them to talk to their neighbors and friends.

Toby Milroy: I think that’s a perfect step. This is a little bit of an aside, but it’s on the same type of subject; and that is the non-relevant bonus. As I’m sure you know, Master Yi, as well as many of our readers, Steven Oliver is part of Dan Kennedy’s platinum group, which is a mastermind group of people in different business and industries. One of the members is Dr. Tom Warren. He is a dentist and has a huge network of information meetings for dentists. One of the biggest referral generating tools that they’ve used in any of their dental practices was a three-tiered referral program.

They created a small sign with the referral prizes listed, and they place the sign on a shelf at exactly eye level when a patient is lying in the chair. The referral program is right in front of you!

The first two prizes were dental health-related: a discount or gift certificate for dental services and a second prize of a $200 electric toothbrush. The third prize, however, was a $150 gift certificate to Ruth’s Chris Steakhouse. That prize, of course, was irrelevant to the dental practice or business, but it pulled 400% more referrals than the other two prizes combined.

I want to cover another topic with you that I know will be extremely valuable for school owners; and that’s your charter membership of the NAPMA Inner Circle group. We’ve really enjoyed having you in the group; you’ve been a great contributor to some of the smaller school owners and an important because of your willingness to help guide others. Tell me a little bit about what you feel about the group, what you’ve accomplished, what your experience has been so far, and what was your mindset that caused you to become part of the group.

Jason Yi: First, the Inner Circle group is working great. I’m so happy to have had the opportunity to join this group. Being able to network with other successful school owners is one of the most important benefits for me. We can share our knowledge and experience with each other. Another important benefit is that we motivate each other.

During our first meeting, I got thousands of ideas and I have high rocketing motivation. This motivation is priceless. That’s something I’ve been looking for, and it’s been working great. The Web forum or discussion board is an easy way to share experiences, based on each other’s questions. We learn better ideas about how to solve our problems. We also call each other. When I called Master Dusty Everson, we just motivated each other. I probably will stop by his school some time in the future to take a look at his school and how he operates it. He is coming to my school as well, so this is great. I’ve been looking for this type of networking and NAPMA and the Inner Circle group is right on target for me.

Toby Milroy: I think there are three primary benefits of being an Inner Circle member, and you identified two of them: being with other successful school owners and sharing your experiences, answering each other’s questions.

I want to remind our readers that Inner Circle members are not, for lack of a better term, part-time, recreational martial artists who are running schools in their backyards. Most of these guys are more than a half million dollars a year in gross revenues. Most have more than 200 students, plus or minus. There are several multi-school owners, and everyone is extremely focused on developing high quality students (and many of them) and creating a solid business.

It’s very rare, as an independent and/or small business owner, as a small business owner, to find a group of people, such as Inner Circle, that can share their experiences and failures; it’s extremely valuable.

The third benefit that I want you to shed some light on is that, as school owners, we have many good ideas and many educational resources, but ultimately you’re left to your own devices. You must implement those ideas or find, even buy, those educational resources and learn from them. The value, or benefit, of the Inner Circle group is that these are really sharp guys who won’t let you make excuses next month if you didn’t implement the ideas that you said you would. It’s a fact that, as small business owners and entrepreneurs, we very rarely have someone available to hold us accountable. How do you feel about that? What do you think about the nature of that type of relationship?

Jason Yi: Definitely, that’s very important. As an Inner Circle member, I go to those meetings, listen to teleconferences and share ideas, so we can achieve better results. It’s very valuable to check with other members at our next meeting about what results they accomplished, using which methods.

Toby Milroy: You need someone to hold your feet to the fire. Too often, we find a tool, an idea or a method to grow our schools and we forget to use it. We found an answer to a problem, but didn’t implement it.

I also want to talk with you about your staff development program. I recently interviewed Chuck Crone, another Inner Circle member, and he told me that he was in a bad car accident that forced him to the sidelines of teaching, but that experience provided him with valuable insights about his school. He had to take a passive teaching role and watch his classes from the parents’ perspective. He had a bird eye’s view of his operations; and it started him thinking about what was his students’ experience. Now, he wasn’t buried in the class, where he had never seen the outsider’s point-of-view.

You have a very strong staff and some very talented individuals working with you. Tell us why staff development is an important part of the mix when a smaller school owner, who may only be doing $20,000 or $30,00 month, wants to become a million-dollar-a-year school. Tell us how your system works and how it evolved?

Jason Yi: Staff development is one of the most critical parts of operating a school and to grow from one level to the next. I’m very lucky to have met my current program director. He became a key member; first, as my head instructor, and then I gave him the role of program director, so I could focus on teaching, while he is focused on enrollments and renewals.

Staff development must be an ongoing process. If you don’t need any staff or you’re not looking for staff, then I believe that’s a mistake because you still must have a system that develops future staff members from your leadership team or even parents. Part of that staff training is to create a shared perspective, so everyone is operating the school according to your vision. If you can do that, then your school will be very, very successful.

Toby Milroy: Master Yi, what kind of system do you have that can start with a White Belt, or a new student, and develop him or her into a future instructor? With 550 students and a million-dollar-a-year school, it’s not by happenstance. You don’t just stumble across someone a Brown Belt student and tell him or her, “You look like you might be a good instructor.”

Jason Yi: During, testing my staff members and I evaluate each student: their progress, attitude and enthusiasm. Based on those evaluations, we’ll choose some candidates to become future instructors. Some of them are qualified to become leadership team members.

Toby Milroy: Let me stop you there. At what stage in a student’s training do you start to determine whether he or she is a fit for leadership?

Jason Yi: At the intermediate level or after the intermediate level. Students have usually been training approximately a year before we evaluate them for the leadership team.

Toby Milroy: This is for your instructor training?

Jason Yi: Right.

Toby Milroy: Let’s say I reach that level and I’ve been evaluated and you decide that I am ready for instructor training. What happens next?

Jason Yi: A student’s next goal is to achieve Black Belt, which usually takes about two and half to three years. After earning a Black Belt, the student is then able to come to the floor and assist the class. He or she is not an instructor, but an assistant. The student then receives another two to three years of training to become an assistant instructor. That’s followed by an instructor program, which results in becoming an instructor. Not only must these instructor candidates be able to perform the martial arts, but also they must demonstrate an ability to help other students, be patient and develop people-friendly skills and mindsets. Only those students will become part-time instructors.

Toby Milroy: Early in their training, you identify whether they have the aptitude and attitude with your evaluations of the entire student body during your regular exams. That’s the most important point to take from this interview about staff development. You should be evaluating your students at every exam and speaking with their parents to make sure everyone is on the same page, especially as it relates to the outcome, each student’s goal.

It’s not left to chance; it’s not accidental. I think it’s a great system that every MAPro reader can replicate in his or her school.

Let me remind all our readers that Master Yi will be at the 2008 NAPMA Extreme Success Academy. You can have the opportunity to learn from him and other Inner Circle and Peak Performers members, but you must be a member to attend. Go to ExtremeSuccessAcademy.com for all details: to join NAPMA, register for the Academy and reserve your room.