Episode 31: Our Top 3 Online Business Predictions to Watch For in 2023

We've identified three online business predictions for how the online space will change in 2023 that you can watch for and take comfort in. The world is in a constant state of flux. With all the talk of a recession coming on the heels of the pandemic, we wanted to add a voice of reason to the mix. Recession is simply a part of a healthy economy, which we discuss during this episode. It's not all doom and gloom, folks!

Episode Transcript:

[01:05] Deirdre Harter: Recently, we've seen people posting about the fact that the newest trend in the online world is getting back to basics. And we built Encore Empire on those same business basics. So this is not new for us, but we thought it would make for an interesting topic to explore.

[01:21] Carmen Reed-Gilkison: In the United States, if you listen to mainstream media, we are in the middle of a recession. This comes right on the heels of the Pandemic that the world has grappled with over the last two years. These two events have changed the way we do business online and off.

[01:42] Deirdre Harter: And I don't know if you've heard of this website, but if you haven't, you should definitely check it out. It's called The Motley Fool. And according to Motley Fool, a reputable investment company, economic downturns typically last only ten months. And this one that we're in right now began in August of 2022. That means that if you buy into what mainstream media is selling, we have just six more months of recession. Now, recessions follow expansions like nights follow day, said Rushir Sharma, head of emerging markets and global macro at Morgan Stanley Investment Management. And he says we've experienced a global recession once every seven to eight years over the last 50 years.

[02:33] Carmen Reed-Gilkison: And so what that highlights is that everything ebbs and flows, that this is normal. And people, well, especially media, of course, mainstream media hypes it all up, and people buy into it, and they freak out. And, of course, there are people who are experiencing difficult times. We all have our own ups and downs, right, regardless of what's going on in the world. And then sometimes these world events affect certain segments of the population more than others. But what we want to highlight with this is exactly as Mr. Sharma said. We’ve experienced a global recession once every seven to eight years over the last 50 years. This is normal. Now, Deirdre and I built Encore Empire during the Pandemic. That's when we started our business. But even though we started Encore Empire during the Pandemic, it's not our first rodeo. We aren't brand new entrepreneurs in the Pandemic. We were online entrepreneurs for decades before, and we brought our expertise together to create one holistic business that we absolutely love. And we are growing very well during a recession.

[03:45] Carmen Reed-Gilkison: So what does that mean?

[03:47] Carmen Reed-Gilkison: That means that just because something is being shouted from the rooftops, it doesn't apply to you necessarily. So we encourage you not to get freaked out about what's going on and focus on what you can control in your own life. Focus on you.

And one of the principles we built Encore Empire on, is the inside-out approach, and we do this for several reasons. First of all, it allows us to tap into our values, and that helps. Values are like our guideposts, and make sure that we are building what we love and not just building another job. But the other thing that it does is it allows us to focus on what is real for us and not get swayed by everything that's happening “out there,“ right? We want to know and focus on what is true and real for us and what we can control. To the extent we can make ourselves happy and prosperous, we can affect the world in a better way, right? So if we get knocked off course or swayed by what we hear and a lot of it can really affect us. I know a lot of people who don't listen to the news or anything like that because it can be negative, but we don't want to let those things knock us off our game, right? Everything that's happening affects online business, and we've identified three important factors to take into account so that you can focus on what matters and the things that you can control.

[05:18] Deirdre Harter: That's exactly right. One of those things that the factors that we should take into account is discerning buyers. Now we've heard a couple of online authorities in the coaching space talk about this, but this is a trend that we're going to be seeing more of. We're going to see buyers that are more discerning. And what that means is that they're just going to be more thoughtful. They're going to take a little more time to decide where they're going to invest their money. 

And I know that I've been talking to women who have online service-based businesses, and that's exactly what I've been hearing too. They're like, well, I want to make sure that I'm investing my money in the right things. And I think for a period of time over the last couple of years, especially when the pandemic first started and everyone was like, oh, everyone's going online. And new business owners were popping up everywhere, and social media was really ramping up. I think there was sort of a buying frenzy. Like we were all like, oh my gosh, we're all shut in at home, and so now we're all going to go online. And so people were purchasing more online courses and online programs, and now that we're in this recession, people are now thinking, oh, I've really got to kind of rein it in. I need to make sure that I'm not overspending. 

This doesn't mean that spending will stop. It just means that people are going to be more thoughtful. And that's actually a good thing, especially when you are providing a very valuable service and you have built your business on the relationships you're building with your audience and with your customers. And just so you know, the right people are still buying. They're just simply taking a little more critical eye. And when we talk about the recession and people how it's less spending power, that is true. But as Carmen said, it's certain segments of the population. 

Now, grocery let's take groceries, for example. We are all experiencing this, I'm sure. Grocery prices are going up overall. But if someone has to make the decision between buying groceries and working with you as a coach or consultant, they probably are not your ideal client, right? It's not the kind of person who's right for what you have. So when we say it only affects certain segments and the right people are still buying, the people that you're working with, they are still going to have the funds to work with you, and they're not making these critical decisions of, oh, well, if I work with this person, then I'm not going to be able to make my mortgage payment this month. 

Now, fly by night doesn't work with discerning buyers, and we don't believe it works ever. Sure, you can follow the latest shiny object trend that you see on Instagram or TikTok, especially when it comes to marketing, and you might make some money. But most of those trends are just that. They are short-term tactics, and they're not going to last. And you're going to spend a lot of energy, a lot of time, and possibly a lot of money trying to make those short-term tactics work, and then you're not gaining anything in the long run. Strategy is a big-picture outlook that is designed to weather the storms.

[08:43] Carmen Reed-Gilkison: Strategy is our favorite thing. So the second factor that we want to discuss today is when these people, these discerning buyers, are going out and they're going to purchase, it's kind of like what Deirdre just talked about, where, in the beginning of the Pandemic, a lot of people came into the online space to start a business, which is great. We started ours in the Pandemic. I don't know if we were part of that wave where we were suddenly like, now is the right time. I think things worked out in a different manner for us. But what happened is a lot of people learned how to create a facade, meaning that they post beautiful things on Instagram, and they post videos and they post this and they post that, and people get lured by the facade or the curtain. 

Let's think of it in wizard of Oz terms. Remember the curtain and then what was behind the curtain? Who was this masterful Oz was just this guy trying to make a big facade for everybody to believe in. Well, that's kind of what happened in the online space, and there's an element to it that will always continue. One of the things we talk about a lot is bro marketing. That was kind of like a facade as well. Or that whole laptop lifestyle thing where you can be on a beach with a margarita or a pina colada and earning millions. Sure, that could potentially happen at some point, but that's not a strategy. We don't build strategies around that. 

A lot of things are changing in the online world, and how many times have you heard “make 60K months or my clients are making six-figure months?” And all of those pie-in-the-sky statements, and you think, first of all, you either think, well, wow, that's pretty cool, and or well, I'm not doing that, so there must be something wrong with me, right? But let's say that you do have a 60K month or a six-figure month. Then what? That's simply step one of gaining a client. And a lot of these people, and not everybody, this is a general statement, they're good at marketing and sales, but they're not good at delivery. So when you make all these sales, that's great, right? It is great. But now you need to be able to serve the clients and get them the results that they are paying you for, the results that you promised. It doesn't stop. You didn't now suddenly win. You only win when your clients get results. So yes, making the sales is a great thing, but it's not the only thing. 

Too many people sell frameworks and quick fixes that may or may not fit with your business model. And this goes back to what Deirdre said, where you could buy into something and try and try and try and not get the results because it was a tactic, and it's not a strategy that's customized to your business. That's why when we work with our clients, we are customizing every step that they take to their business and creating a strategy that's going to last long past all of these fly-by-night shiny objects. So when people are focused solely on achieving a sales goal, serving the client might not be as important to them. And that's something that discerning buyers will start taking notice of. If all they're seeing on someone's Instagram account or Facebook feed or LinkedIn is about all these launches that they've done, and they're not seeing posts about clients achieving success or any other value, then that's a red flag. It's great that this person learned how to make sales, right? But that doesn't mean they're going to be the right person for you, and a discerning buyer is going to be paying attention to that. 

The other aspect of this is that there are celebrity coaches out there, right? Celebrity coaches that you've heard about that are big names in the industry. And we actually invested with one of these. And she was so far removed from what the clients experience once they get into her program, and she was absolutely not there at all, that she doesn't know what goes on. And there were a lot of disgruntled people, us included. Now that just hearkens back to someone who is like, she's a brilliant person, but her brilliance is removed from the equation for the client. So they use her past performance and her past wins and all of the things she's accomplished to get people into the program. And then it was almost like a bait and switch where you never saw this person, so you never got any of that brilliance on your business. And that's another thing that happens. We hear that from our clients all the time, and it's too bad. And it's something that Deirdre and I take a big stand against, having experienced it for ourselves. We believe in always having access to the experts, and that's something that we promise because when you hire someone to help you achieve a transformation, to learn something new, or anything else, you are, in fact, their boss.You hired them.

And sometimes the power dynamic can be switched, right? You're in awe of this person. You bought into this program, and you feel, of course, that you want to learn from them. But the reality is you are the one in the situation that has the power because you hired them. So they need to meet your needs. So if you see someone sharing their finances as a trend, all those posts about, hey, these are the months I'm having, here are my finances, that only tells one piece of the puzzle. It doesn't mean that they are sustainable unless they've been in business for many years, and maybe they've been posting this kind of stuff over and over, along with value posts and proof of client success.

[14:30] Deirdre Harter: That's right. And so now we're going to talk about revenue versus profit.

[14:36] Carmen Reed-Gilkison: Are you ready to get the guidance you need to optimize your online business? We help ambitious female entrepreneurs cut through the online noise of too many options, too many tactics, and too many shoulds. Through our encore business incubator. Group program and our Empire Builder two-on-one laser coaching program we teach you the right steps to take and in what order, so there's no more guesswork. And we teach you how to measure and track your progress so you can clearly see what's working and what's not. You are cordially invited to hop on a complimentary consultation call to discover if working with us is the next right step for you. Head over to encorempire.com/consult to schedule your call now.

[15:28] Deirdre Harter: And as Carmen said, a lot of times we see this, we're being transparent because we're sharing our actual sales numbers with you. Well, I'm going to tell you that revenue, which is basically sales versus profit, can be as different as night and day, and revenue does not necessarily equal profit. So I'm going to break this down a little bit for you. You can have a $500,000 a year in revenue and little to no profit. Yes, you heard me right. And I know this is shocking, but it is true. And in fact, once you pass around $250,000 a year in revenue and in sales, it is really difficult to keep more than about 30% of that for yourself. And let's do a quick mental math here. 30% of $250,000, that's $75,000 per year. Now, it's not poverty level, and it's not minimum wage, but if you're earning a quarter of a million dollars and you only get to keep 75,000 of that for yourself. Think about that for just a minute. So why is this?

You think, okay, we all work toward that 1st 100,000, right? That's always everyone's goal. If I can just get to 100,000, it will be doing good. But then, moving on from there, everything shifts because your expenses go up significantly because then you're serving more clients, right? And your business has layers of complication added to it. You need different kinds of systems; you need different kinds of processes. You're going to need help with some of those processes in order to sustain that level of revenue, depending on, of course, what your business model is, what your prices are, and so forth. But in order to continue growing in profitability, like if you go, okay, well, I hit two 250K, and I personally am bringing in 75,000, but I want 100,000. I want to have six figures for me personally. Then you're going to have to continue to grow that profit. And that is a major shift in business strategy. Anytime you are moving past that $100,000 a year in revenue, moving up to 200,000, $300,000, there is a different business strategy that is required. And this goes back to what Carmen said, why we've built our business and why we work with our clients to set up their values and to use that inside-out approach. Not everybody wants to run a mega business, right? Like not everybody wants to—yes, the money is nice—but when you understand what's required and the investments that you'll need to make and the team that you're going to have to hire in order to help you to sustain that level, then sometimes entrepreneurs don't realize it till they get there and they're like, oh, I just created this monster. I'm not sure that I really want to do it this way. 

Now, we are moving into year three since the shutdown first started due to COVID and many people started a business, and that increased competition in the online service marketplace. Now, statistics show that a majority of new businesses fail within the first four years. And what this means is that only business owners who are serious and experienced in what they do, meaning they're an expert in their space. Those are the only people that are going to be around in the next year or two out of this rush to online business. So if you're thinking, wow, the marketplace is crowded, we're in a recession, things are changing. Online marketing is always confusing. If you're thinking these things, I wanted to give you this statistic so that you understood that, as Carmen said in the beginning, there's an ebb and a flow to everything. And recessions are a normal part of how our economy works. And this rush to online and opening of new businesses because of it, it's not going to be that way forever. And just like how there were many millionaires made in recessions in our past history. And I'm not saying that you're automatically going to become a millionaire. But what I am saying is that when you just hold to the strategy, when you have the right strategy, and you hold to that strategy, and you just keep doing and implementing the action plan that supports that strategy, you're going to grow your business, you are going to succeed, and you're going to earn the revenue and have the profit that you want in your business. So I think the bottom line to this whole episode and what we're trying to get across is it's so easy for everyone to use circumstances as an excuse, but you don't need to let what's going on on the outside affect what is going on for you on the inside of both you and your business.

[20:53] Carmen Reed-Gilkison: That is such a good point. And marketing is more critical than ever to get right so that you can communicate exactly what you and your business stand for to the ideal clients you want to attract. And this goes back to the discerning buyer, right? So let's put ourselves in the place of the discerning buyer. You probably already are one, but how do you determine if someone is the right person to work with, to hire, to invest in? 

You're going to scope them out online. You're going to check out their website, you're going to read their blog posts, you're going to read their social posts. Hopefully, you'll opt into some of their things, so you get a feel for how they work. If they host events, that's a great way to get to know them. We host the Marketing Methodology Workshop, and this is where we teach people how to Begin With The End in Mind, Learn the ABC Method of Converting Prospects Into Clients, and Build a Streamlined, Effective Marketing System that you can use over and over again. And we take you through our process over five days. It's a free workshop, and we get rave reviews. Deirdre, do you want to share some of the reviews that we've gotten or some of the responses that we've gotten to our question?

[22:07] Deirdre Harter: Oh, yes. So we ask this question. We're always about polling our audience and ensuring that we are delivering on our promises, whether it is with our clients and the work that we do with them or even when it is in this workshop that we do. We are forever improving things because we deliver on this workshop at the same high level that we do with our clients, because it's the only way for online service providers and women who are in business to know what it is like to work with us, and we feel it's so important for them to really know. 

So the question that we ask is: What is your biggest takeaway from the workshop? So, here are just a couple of the comments that we've gotten back. The first one is “it put together a lot of things I've learned in different courses and tied them together in a way that was easy to understand.” And another attendee said her biggest takeaway was “that a systematic process is available that takes away the overwhelm and confusion.” Another, one of my personal favorites, is “my biggest takeaway is that I need to gift myself the time to work on my business for a while and tune out the noise. I'm in way too many Facebook groups and going to too many events when I need to slow down and lay out my business goals and content plans.” And that really sums up what we teach you to do and help you with in the Marketing Methodology Workshop.

[23:42] Carmen Reed-Gilkison: That's right. And it hearkens back to that inside-out approach, what this lady is talking about. I mean, she says it right there, and she realized that based on what she got from the workshop because that's how we lead, right? And she realized that she needs to gift herself the time to work on her business for a while. And we all do. And that's one of the biggest things that Deirdre and I see that is missing out in the online space with our clients. Everyone's so busy trying to do the next thing, but the next thing is never or almost never working on their business. They're just working in their business, scurrying around and trying to post and do all these things and follow all the advice they get, but no one's taking the time to set aside to work on their business. And so this is one of our favorite responses to that question because it highlights that very thing that we talked about in the beginning, which is the inside-out approach. To experience results like these from a free workshop and walk away with your marketing plan for the next year, you're invited to join us for our next Marketing Methodology Workshop. Simply head over to encorempire.com/mmw.