Clickfunnels – an online tool that helps entrepreneurs build sales funnels. Founded in 2015, it generated $14 million in revenue in the first year and rose to over $100 million in revenue by 2019.
Strategy & Tools
How ClickFunnels Started - The early days of Russel Brunson
In 2003, Russell hit his first big success in online marketing with a software called ZipBrander. This tool was designed to drive a lot of targeted traffic to websites and automatically boost backend profits.
Two years later, in 2005, he created a DVD course on "How To Create A Potato Gun". He had a simple one-page website and used Google ads, spending $10 a day and selling each DVD for $37. This made him $27 in profit each day. But then, Google changed, and his ad costs shot up to $50 a day. He started losing $13 daily.
A friend suggested adding upsells (one-time offer) to make more money from each customer. Russell decided to partner with a guy in Idaho who could dropship potato gun kits. So, he added an upsell to his DVD, offering a $197 potato gun kit. Every third customer bought the kit.
With this new setup, he spent $50 a day on ads but started making $102 a day. Now, he was making $52 in profit a day. Just a year after graduating college, he made his first million dollars selling his products.
Russell went on to sell a variety of things, including shakes, supplements, coaching, books, consulting, coupons, t-shirts, tech services, and software. He also became a top performer in several network marketing companies, winning a Ferrari and generating 1.5 million leads in just six weeks.
Russel Brunson has been known as a marketing rockstar long before the release. Over the years, he gathered a huge community of entrepreneurs around him.
Brunson was obsessed with list building.
And so he was interviewing people on how to build lists while building his list, attending and organizing marketing summits, paying affiliates to promote his products at a 120+% commission only to get their list members to join his, and many more similar activities.
That turned into a list of over 1 million entrepreneurs. It was highly targeted, so whenever he thought of monetizing it, he would send a new product to the list - a coaching program, training, etc. It has proven to be making hundreds of thousands of dollars „just like that”.
This list has been the first channel to promote Clickfunnels, bringing 200 people into the beta easily.
Clickfunnels is a completely bootstrapped company, with an evenly distributed stake of 27% per each co-founder. The last 19% belonged to Dotcom Secrets, another company founded by Brunson which was the initial funding source.
For the first 3 months, no one wanted to buy into ClickFunnels.
Why? No one understood the concept. Back then, most people didn't know what the funnel was. There was a huge gap in the problem/solution awareness.
Then, early 2015, Mike Filsaime, Russel's friend was running an event in San Diego and wanted Brunson to talk about funnels and pitch ClickFunnels to the audience.
After an hour-long presentation, 38% (380) of people bought the $1k product that included:
Ka-ching! $380k goes to the bank!
After ginormous success of the first presentation that made Russel $380k in 1h, he texted all of his friends who had email lists to do webinar for them with the same presentation. 5 people agreed.
During the next 12 months, Russel did almost 100 live webinars. They were promoted by his affiliates and with paid ads.
Each webinar hosted by the affiliate got the revenue split 60:40.
Within that time ClickFunnels made $14,000,000 revenue.
The presentation worked so well, because of its unique structure. Brunson now calls it "The Perfect Webinar".
The presentation works more or less like that:
Another way of incentivizing referrals they:
Clients promoting the product also get called on stage at Clickfunnels events which builds their reputation, oftentimes the commissions are 100% on books or other offers that bring new customers.
A ‘Powered by Clickfunnels’ badge is added to a landing page created with this tool by default, and if someone clicks it and then buys – the user will get a commission.
Break-even funnel makes a small profit on the first sale (usually an info product introducing a concept around which you've created your business), and can bring in new customers who can then be introduced to the main product, like ClickFunnels.
During the first 3 years, Russel used 5 funnels to get to $100M.
Psychology
Brunson made sure everyone knew he was the real deal in marketing by showing off all the cool stuff he’d done before starting ClickFunnels. He built up this “marketing rockstar” image that made people trust him more.
Through his books, webinars, events chatting with other big names in the industry made him look even more like the go-to guy for marketing advice.
The order and looks of possible choices in which they are presented influence the choice. The ‘Powered by Clickfunnels’ badge is set on by default, so some users will leave it there just in case someone buys Clickfunnels through their affiliate link and others will have it on for some time until they realize and turn it off.
The building in public, transparent approach of Russel Brunson makes the brand appeal as more authentic and people prefer those over the ones that seem artificial.
Brunson leveraged events and webinars to build social proof. The reason why referrals are so powerful is that they often come out of the people you know. It seems that we’re much more likely to try products referred to us by friends or colleagues.
The structure of the webinar presentation emphasized limited-time offers, creating urgency.
Russell was a master at using the foot-in-the-door technique to build up ClickFunnels' upsell funnel. This method turned casual browsers into loyal customers who were ready to invest more and more. By starting small and building up, Brunson created a smooth, effective upsell funnel that made it easy for people to say yes at each step.
Window of Opportunity
Clickfunnels success didn’t happen overnight. It is the outcome of over a decade of tactical, intensive marketing oriented on user acquisition–first under the Brunson’s personal brand and his mailing list and then it was presenting his audience with the new software.
List building and webinars is not enough discussed these days, but this example shows how many benefits you can get out of it. The business is in the list!
Get your
"oh sh*t, this might work for us!"
moment in the next 5 minutes
In the first email:
Other than that:
(You won't find it anywhere else)
Explore Cognitive Biases in Marketing
