“I Want to Share My Amazing Business Secrets That Will Help You Overcome the Obstacles to Your Success!”

Master Samuel Scott is a 6^th-Degree Black Belt. He teaches a system called Talahib Kuntao, a mixture of Indonesian and Filipino martial arts. Master Scott was also a nationally ranked fighter, and was inducted into the Black Belt Hall of Fame and named the Instructor Of The Year for 1996.

Toby Milroy: This month's Success Story guest is Master Samuel Scott, a NAPMA Inner Circle member. Master Scott has been operating a very successful business for many years. Master Scott is a former corrections officer and a member of emergency-response teams. As a tactical expert, he has real-life experience, using martial arts and self-protection techniques, unlike many instructors and school owners, which will be very cogent to our discussion. Having completed our most recent NAPMA Inner Circle meeting, let's talk about your experience and the big breakthroughs you plan to implement at your school during the next 12 months. The lesson to learn from your experience is one NAPMA has often shared with its members. It is very common for school owners to think that their businesses are different because of their style, location or demographics. In reality, there are universal business practices that apply to all small businesses. Master Scott teaches eclectic styles that are very different from Karate and Taekwondo, which are considered the core styles taught at many U.S. schools. Highly successful school owners, such as Master Scott, understand this concept and are eager to implement the universal business practices that have been proven to work in a great cross-section of small business types. Master Scott, how did you develop your eclectic style that is very reality-based to become a successful curriculum for junior and teen students as well as adults? Samuel Scott: Typically, our program is strictly for teenagers and adults, but I've incorporated an abbreviated version into our Black Belt Club. Members may have seen a brief example of our leg check takedowns on the May 2009 NAPMA Innovations DVD. I hate to say it, but self-defense training will always be a big part of our business because of the times in which we live. People are becoming more aware that they must learn how to protect themselves. We are doing extremely well with women's safety programs. We offer a two-week women's safety workshop, and then introduce them to our street-combat program. Toby Milroy: Too many school owners offer short-term, special seminars for a weekend or a week, but don't understand how to transfer those short-term participants into long-term paying students. The cardio kickboxing trend is a perfect example. Much like a gym or health club, cardio kickboxing customers provided only marginal value to martial arts schools. You, however, were able to crack the code. You have a very sophisticated understanding of how to use short-term seminars to feed your core program, which is where you can maximize the value of every student. Please describe how you market your women's self-defense seminar, and then motivate those participants to become students in your regular program. Samuel Scott: I've implemented the Internet strategy that has been discussed during our Inner Circle meetings. We drive interested women to a landing page, with postcards and advertising in a local newspaper circular that is distributed to approximately 20,000 to 30,000 homes. Those materials market the free program and provide the Web address for the landing page. We ask visitors to the Web page to provide their names and email addresses to register. Once they attend our free seminar, we work to build lasting relationships. We don't hammer the seminar participants to enroll in our regular program. We educate them about personal safety, with handouts, presentations and neighborhood crime statistics. Much of the crime that takes place in any neighborhood is never seen on TV news, so I pull the police blotter from the newspaper or contact my friends in the police department that provide me with that information. Once we can show the women in our seminars that crime is occurring in their neighborhoods or within close proximity of where they live, then it hits home with them. After a week or two of presenting those facts and the importance of scheduling time during their busy weeks to learn how to protect themselves, they start to understand why they need the comprehensive training of our regular program. The key is that the women in our regular program look, dress and behave much the same as the women in our free seminars. We ask the women in our regular program to demonstrate their skills to the free seminar participants; and once they realize that women just like them are succeeding in our regular program, then the seminar participants are hooked, and more likely to enroll. Toby Milroy: Let's review each of the component parts of your approach, so our readers understand how to implement this approach at their schools. First, you decided to offer a free women's self-defense course that would attract women to your school with which you could build enough relationships to enroll a maximum number of them into your regular program. You were marketing your course with offline and online techniques that drove interested women to a Web page where they could register for your free class. For example, you ran display ads in a circular newspaper. What information did your ads provide? Samuel Scott: The ads announced a free women's safety workshop, with the date and time and, of course, call-to-action copy that included a telephone number and the Web address. Toby Milroy: That is what we call a blind lead generation ad because you didn't mention martial arts. Instead, you applied a fundamental marketing principle, which is that your ad's message was relevant to the market and used language to which women would respond. Your ads identify a problem that many women experience or a benefit that they want, instead, of presenting your martial arts credentials: your styles, number of fights and medals, etc. Unfortunately, too many school owners create ads and other marketing materials that are egocentric and irrelevant to the market. The second step in your approach is to develop a cleverly crafted Web page that is a direct-response lead-generating tool. Its only purpose is to collect leads or registrations for your seminar by offering visitors something of value. Even in 2009, this is revolutionary thinking for the average martial arts school owner; but, for you, Master Scott, and many other businesses and industries, it is a common marketing strategy. Master Scott, you also mentioned the use of databases of local homes and women to which you market with postcards, emails, etc. Please describe how those techniques work for you. Samuel Scott: I purchase databases from various sources, such as salesleads.com and salesgenie.com, for women, 18-45, within an eight-mile radius of my school, which are approximately 2,000 names. I send postcards to that list. Another technique that has worked well is the creation of a T-shirt, with "Women's Safety Ambassador" printed on it. I organize a team of people to wear the T-shirts and circulate throughout the neighborhood to distribute our postcard. As we talk with women, we inform them of the recent crimes in the neighborhood and invite them to our free seminar. An important motivational key is that we frame our seminar as a community service, with no requirement to continue. That eliminates most objections or negative responses, but also ensures that a maximum number of prospects attend the seminar. We've discovered that once they experience our school's environment and staff, the seminar participants are more likely to enroll in our regular program. We make sure to state that our purpose is not to sell them, but to help them. Based on our experience, talking with women face-to-face in their neighborhoods is very important because they perceive by what we say and our body language that we truly care about their safety. Toby Milroy: Another important lesson is that it's difficult to create relationships at a distance, and within the few seconds that most ads are viewed. As you've related, however; when you can speak with consumers directly, face-to-face, you have a much greater opportunity to develop those relationships and make them much more solid and lasting. Many school o
wners do a great job, utilizing their leadership skills, to motivate individuals or groups to become excited about how the benefits of martial arts will solve their problems. Those same school owners, however, don't take the process to its obvious conclusion, and that is to ask for the sale. What techniques have you used to take that final step, and convert your free seminar participants into paying students? Samuel Scott: We give the participants a free, no-obligation offer at the end of the free seminar. We emphasize that, although the free seminar is completed, those women who recognize the value of this training and are seriously concerned about the safety of their families and themselves can choose to continue their training. We specifically offer a six-week program, instead of asking for a big, one-year commitment; it's still a bit of a soft sell. We tell the participants that what they learned during the free seminar is just a fraction of what they could learn during the next 90 days or six months. We also price the six-week program at a more affordable tuition level. Once they start the six-week program, we begin to pre-frame them during the second week to enroll in our regular program. We achieve a 20- to 25%-conversion rate. Toby Milroy: Your approach works so well because you've made a promise and your free seminar participants are under no obligation to continue. The biggest problem for many school owners, however, is that they are shy about asking prospects or free seminar participants to take that next step. Samuel Scott: Let me be brutally honest. I had to learn that skill myself because I was a victim of low conversions. I would hold workshops, and being a martial artist, I viewed my first and foremost duty was to serve the community. The workshop participants would praise us, provide wonderful testimonials and then walk from the school, never to be seen again. As soon as we changed our system and asked prospects to join, they started enrolling. My point is that prospects will do what you tell them because they recognize you as the expert. Tell them that they must schedule the time to learn how to protect themselves. It's not an option anymore. This is our program and it costs X. You ask if the tuition will be a problem. They respond that the tuition is affordable and they're excited to start. That must be your mindset. Prospects want to be guided; and if you let them enter and leave your school without guiding them, then they will consider you an entertainer and not a martial arts instructor that will teach them how to protect their families and themselves. In a sense, asking for the sale is an extension of your expert status; prospects wouldn't expect you to advise them to pay for a program that wouldn't deliver on its promise.

"As we talk with women, we inform them of the recent crimes in the neighborhood and invite them to our free seminar."

Students at Samuel Scott's Full Circle Martial Arts Academy are intensely focused on their training in an eclectic style known as Talahib Kuntao, a mixture of Indonesian and Filipino martial arts. Toby Milroy: An excellent analogy of your point is what the author, Peter Drucker, once wrote: the average person walks through life with his or her umbilical cord in hand looking for a place to plug it. To put it a bit more delicately, as you did: people need leadership. People want to be told what to do. They want to be told that if they do X, then they will obtain Y. That is why weight-loss TV commercials, in fact, all commercials, work; they make it very easy to say yes. Family Jewels, the Gene Simmons TV show, is one of my guilty pleasures. Now, it's a horrible show; it's cheesy and badly scripted. It is supposed to be a reality show and, despite how bad it is, occasionally, there is one little lesson that makes it worthwhile to watch the entire season. Recently, Gene was shown talking with his partner and business manager and said that he had a great idea. He wanted to go to the New York Stock Exchange and ring the opening bell; do the whole rah-rah thing. They responded by telling Gene that you couldn't just call the president of the Exchange and ask to ring the bell. Gene said why not? He can only say yes or no. (The Stock Exchange president must have said yes because Gene rang the bell.)

The lesson is that the average school owner is afraid to make the "phone call"; they are afraid to tell seminar participants that they've learned a small portion of what they need to know and that it might be valuable for them to enroll in a regular program. School owners are afraid prospects will say no; and then the school owners take it personally, when, in reality, it's a disservice not to ask prospects to expand their knowledge and personal safety. Another perspective-and we've discussed this at our Inner Circle meetings-is that every January thousands of people flood the health clubs and every February thousands leave. Now, you should take that personally, as a martial arts school owner. You should have enrolled many of those people in your school; and if you had, then they would still be students 12 months later. The national average for the health club experience is only 31 to 37 days. If those people had enrolled in your school, then they would have had a 12- to 18-month positive experience (or longer) that virtually guarantees that they will lose weight and learn techniques and skills that will benefit them for the rest of their lives. Master Scott has created and implemented a process that feeds his regular programs; and he doesn't stop short of asking for the sale. His goal, as yours should be, is 25% to 50% conversions from the free seminar to a regular enrollment. You've done them a disservice (and you) when you don't help prospects visualize themselves as Black Belts. Master Scott, what other lead-generation techniques and tools are working well for you? Samuel Scott: I also use blind-lead techniques and a Web landing page for my children's program. We promote a bully-protection workshop, and it has been successful, similar to the women's seminar. We run ads in the newspaper circular and mail postcards that drive prospects to a different landing page. Bullying is a significant topic in the media, even Oprah is providing information, and if you mention her name, then you attract considerable interest. Our summer camp has also been very successful. We worked hard, pounding the pavement and talking with people face-to-face about why martial arts is an excellent alternative to daycare. Postcards and internal marketing to our students have been the best techniques to fill our summer camp. Although these are tough economic times, our school is not participating, but our customers are being pinched, so we must change their perception and educate them that their children must remain focused. In fact, that is one the headlines I use, which has attracted interested prospects. I am confident that NAPMA members can increase their child enrollments if they reshape parents' mind that, during these particular times, they don't want their children sitting at home or spending time with the wrong group. NAPMA members must convince parents that their children are best served by enrolling in members' schools to develop their characters and improve their fitness and wellness. Toby Milroy: Learning, and then implementing the important and fundamental market concepts that you are currently using, is one of the primary benefits of being a NAPMA Inner Circle member. It's a group of very sharp school owners, so everyone is able to share the strategies and techniques that are working in their schools, regardless of economic conditions. Without the support of other members, as occurs in the Inner Circle environment, then you are probably not utilizing the concepts that work, causing your school to struggle. Master Scott, your approach is critical because one of the secrets is to enter the conversation that prospects are having with themselves about the impact of the economy on their families, and then help them justify spending money for an activity as beneficial as martial arts. In fact, the primary focus of the 2009 NAPMA Extreme Success Academy, October 9-11, in San Antonio, Texas, will be to explain how the market has fundamentally shifted and the new set of rules that school owners must follow to be successful. Evidence of that shift can be seen in the dramatic change in the personal savings rate, which has increased by 800% for the average consumer. They have money, but they are saving it. Consumers are paying credit card debt and have reduced their use of their credit cards and other high-leverage debt vehicles. At NAPMA, we call it revealing the pink elephant in the room. That pink elephant (the economy) has a major impact on consumers' thinking, especially during the sales process, or persuasion cycle. Consumers come to the sales process with that buried objection that they will voice, if necessary, to block the validity of your message. A buried objection can be an advantage, however, if you acknowledge and address it appropriately before prospects do. In most cases, you will overcome that objection; however, if you ignore the pink elephant and don't make it part of your sales presentation, then prospects are likely to be skeptical of anything you say. You must provide prospects with good, solid reasons to justify spending money; otherwise, they won't do it. An extreme example from outside the martial arts industry that can be extremely helpful is the current state of Gucci^®. It is having a horrible year, but Juicy Couture^® has experienced increasing revenues. The difference has been marketing strategy. The upscale woman who drives a BMW still wants the Gucci or the Juicy purse, but she is afraid that if she buys it, then one of her friends will say, how could you spend that much money, since the economy is so bad? Her perception of her friend's response is stopping her from spending the money. It is not because she can't later justify it logically to her friends. I observe these marketing trends because first, my wife is a fan, and second, because how premium brands market themselves provides excellent lessons to market martial arts schools more effectively. Juicy Couture has been very sophisticated in its marketing by using this envy situation to its advantage. Its marketing pitch is that a woman can't justify the purchase of a Gucci bag, but can justify a Juicy Couture bag because it is less expensive and the company is donating x dollars of each purchase to a non-profit fund, which adds an altruistic, logical motive to the purchase. Now, when a woman is confronted by a friend who is incredulous that she would spend $700 on a purse, the woman can say that she wanted the purse and the company donated a percentage to a foundation. It is a very sophisticated approach. The lesson for school owners is that you must give prospects reasons to want to invest in martial arts for their children now. Let me turn to a completely different question. I know you have three children and operate three schools. For many school owners, owning and operating schools (and, more importantly, helping people change their lives) is very emotional. They love the arts, their styles; however, once they open schools and acquire students, the work completely consumes their entire lives. They use the daytime hours to be in their communities marketing and promoting their schools, teach classes during the evening and often don't return home until the late evening. They then start that same process six to eight hours later, the next day. After days, weeks and months, they realize that the people that matter the most-their families and friends-are completely neglected because the martial arts school business can be all consuming. Master Scott, I have the utmost respect for what you have accomplished in your career and I think you are a great example for many school owners who haven't yet discovered that their businesses are supposed to serve them as much as they serve their businesses. How have you been able to manage you schools and the marketing of your various self-defense and personal-protection products and spend time with your family? Samuel Scott: My wife has had to live with an entrepreneur for 20 years, and my attention to my business eventu
ally became overwhelming. The mistake I made was that I had not implemented any business systems. I then attended a convention where Michael Gerber, author of The E-Myth, was speaking and he changed my mindset. He said if you don't create systems for your business, then you don't own a business, you own a job. Even though I had left my job with the government and started a business, I was nothing more than an employee of my business. When I returned from that seminar, I sat and wrote approximately 250 to 300 pages of systems and procedures for my school, from unlocking the door in the morning to setting the thermostat at a certain temperature to how the bags were stored to how the van was parked in the lot to when the bathrooms should be cleaned. I determined every detail, including my marketing systems and what are called soft and hard systems. Soft systems are considered the interior of your school, while hard systems are the exterior of your school. Once I was able to implement those systems, I could step back and look at the business from the outside and focus more on the marketing and promotion of the business and then developing a staff. As with many school owners, when I opened my school, I was a staff of one. I wore ten hats, but I had to learn how to give those hats to employees and that was tough. It was difficult to allow another person to do my accounting, to be responsible for my money. I also had to transfer other parts of the business to others, but the bottom line is that you must master the art of delegation and realize that you aren't an expert in all areas of your business. I know I am a good martial arts instructor, but others have skills that I don't, such as accounting, law, insurance, etc. I had to reach the point that I could let many of these systems go, so the business could run strictly on those systems. Of course, an important component is to develop a competent staff that knows the school's systems thoroughly-and mine better be because I hit my staff members with pop quizzes. My school just blossomed, once I implemented those systems, and my stress level decreased. I was able to spend more time with my family and do what I enjoy doing. Entrepreneurs are so focused on chasing the dollar and business goals and success that they think it all leads to a destination, only to realize the glory is in the process. Now, I don't schedule an annual vacation. I take a vacation when I need a vacation. If I want to take a vacation every month, then I take a vacation every month. Every school business owner must realize that, even though we are chasing our dreams, our ultimate goals, we must enjoy the process and find that balance. It's easier said than done, but I had to find time to be with my two teenage children because if I don't give them the attention they need, then they may receive that attention from another source, which could easily be a negative influence. Toby Milroy: Your first-hand experience with Michael Gerber was obviously the key, which is why reading his book is mandatory for every small business owner. I believe the original book is no longer in print, but you can purchase The E-Myth Revisited. I re-read it again for the 6th or 7th time a few weeks ago and it's very much worth your time. Another point that Gerber makes is exactly what you are describing: You must operate your business like a franchise, even if you have no intention of franchising your business. A franchise is a wholly non-personality-driven business. You don't go to Subway^® or Quizno's^® because of the person making the sandwiches; you go because you want a Subway or Quizno's sandwich. You choose to eat at Ruth's Chris Steak House^® because of the product, the experience, not necessarily to see your favorite waiter. For virtually all other small businesses, including martial arts schools, it is exactly the opposite. The business exists and is successful because you are there; students come to train with Master Scott. You must change that perspective because as soon as you leave the school for a vacation, illness or any extended period of time, you begin to lose business and maybe your entire business. Your change of mindset, Master Scott, is the most important lesson for every martial arts school owner. If your business depends on your personal involvement, then you don't have a business; you have a job. Thinking of your daily activities as a job is fine if that is what you want, but don't delude yourself into thinking that you own a business. Reading Gerber's The E-Myth is an absolute prerequisite if you want to own and operate business. Perhaps, the last lesson from The E-Myth that is useful to school owners is Gerber's three fundamentally different personalities of every small business owner: the technician, the manager and the entrepreneur. The technician has the skills to be a great instructor, to explain specific techniques and help students learn them. He is able to talk with parents and do a great job communicating the benefits of martial arts training. The manager has the skills to advance the business and make sure staff members are following the business systems. The entrepreneur is the visionary. With all due respect, Master Scott, your profile would probably be one of the least likely of a hugely successful entrepreneurial school owner. First, you teach a whacky style that is very technical, making it difficult to teach and understand and requiring six years of training to earn a Black Belt; plus it utilizes handcuffs and whips! Pambuan Arnis is not typically considered a mass marketable style, but your style is irrelevant.

 "…prospects wouldn't expect you to advise them to pay for a program that wouldn't deliver on its promise."

Other obstacles that you had to overcome include multiple locations, which some in the industry perceive as a difficulty; you're African-American, which may have limited your opportunities; your family background was very humble; and the community from which you were trying to attract students had a high crime rate. You are a great example and role model for the many school owners that allow their psyches or mindsets to be controlled by a lingering excuse or obstacle that they think won't allow them to be successful. They tell themselves, "I can't grow to 300 students or be financially successful because of X, Y or Z." You have broken that mold, and proven that there are no excuses. That's why Master Scott and I strongly recommend that you read The E-Myth and think very seriously about the current state of systems in your business (or the lack of any systems), and take action to change the direction of your business. Samuel Scott: Thank you, Toby. I can't end our conversation without giving NAPMA a plug. It was my NAPMA membership that was my turning point in 1995. My thanks to NAPMA for the wonderful job it's doing with Master Oliver on the team. I want the NAPMA members and all school owners that don't know Master Oliver to realize that this man is changing the face of martial arts, school owners and the image of martial arts. I've been to his boot camps. He knows how to operate school businesses successfully.