The Key to Deciding How to Spend Your Marketing Dollars Right Now

Asymmetric risk is one of the most important concepts you’ll ever learn. But only if you’re interested in building wealth. Asymmetric risk is one of the core precepts at the heart of every great financial investor who’s ever lived.

It’s fairly straight forward, and goes something like this: When making a financial decision, you want your potential win to be significantly greater than your potential loss. 

For example:

If you invest $1, you only want to invest it in something that can generate you AT LEAST $5 in return (a 5-fold return on investment → 5x ROI).

Let’s say you flip a coin and you invest in the outcome of that coin flip. If it lands HEADS you lose $1, if it lands TAILS you get $5.

When would you stop playing the game?

If your answer is NEVER, you’ve got the concept nailed. Coin flips are 50/50 shots. Over time you’ll get 50% heads and 50% tails.

Which means 50% of the time you lose $1, and 50% of the time you get $5 more.

So if you flip the coin 100 times and say half is heads and half is tails, you’ll likely make $5 x the 50 tails = $250, and you’ll lose $1 x 50 = $50. So your net gain is $200.

HOW TO USE ASYMMETRIC RISK IN MARKETING / BUSINESS DECISIONS

Being in the middle of the COVID-19 crisis, we’re still figuring out when things will get back to normal and your center is running at capacity again!

Here’s what I know for a fact. If this lasts less than 6 more weeks, and you continue to advertise, you’re taking an ASYMMETRIC RISK.

You’re risking a few dollars to achieve TENS OF THOUSANDS OF DOLLARS of enrollments when things settle out.

  • You’ll recover faster by filling your center quicker

  • You’ll likely steal your competitor’s enrollments

  • You can look at expanding quickly if your competitor’s fumble

    Now, let’s complete the risk assessment. The pandemic lasts much longer than anyone could predict. How much time is your marketing spend really going to buy you relative to all other expenses? A few extra days?

    If this is NOT the end of the world (as we know it, you’ll be fiiiine – sorry couldn’t help myself), then strategically you can only make this bet on yourself.

THIS IS THE TIME WEALTH IS BUILT.

Investing in marketing can make a monumental difference when you re-open the doors and you’re crushing everyone because you’ve been deploying goodwill into your community.

Parents will have seen your name in a positive way a thousand times over the past weeks.

Since everyone is glued to their phones and social media, there is tons of “ad inventory” and since not a lot of folks are advertising, it’s cheap. So your few dollars a day spent on ads is getting amazing reach and visibility.

If you were going to take a bet with your business, this is it.

One of my favorite quotes is by Warren Buffet (if you’re not familiar with him, Google his name – he’s considered one of the greatest investors ever), and when he gets asked what his secret is to building one of the biggest investment companies ever, his response is simple:

“We’re aggressive when people are cautious. And we’re cautious when people are aggressive.”

His company, Berkshire Hathaway is sitting on over 100 BILLION DOLLARS of CASH. He hasn’t invested much in the past few years, because things were way too expensive. All the greed had made him fearful.

What is he doing now? … he’s spending much of that cash. INVESTING IT.

This is it, this is the time to make hay, be bold, and use this catastrophic global disaster as a springboard. It may be a small step back for mankind, but it can be a giant leap forward for you.

GYC IS EATING THE CAKE WITH YOU.

Yes, we’re making the bet with you. From mid-March onwards, we’ve been working over-time and actually have expanded our team to deliver more and better goodwill content than ever before.

We’re also preparing your direct response USP ad for when things start looking better, and get you back as close as possible to 100%+ enrollment even before your doors re-open.

Yes, it’s a risk for us to do that. But this is our commitment to you and asymmetric risk. If we can get all our clients to 100% capacity in a few weeks after things settle out, then we’re fulfilling our mission. It’s the only sensible thing we can do.

We’re in this boat together, and as always, have your back

Bruce W. Spurr
Co-Founder, Grow Your Center

Need help? Book a call with Bruce and learn how Grow Your Center can do help you get it done.

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