Can a marketing system help a marketer? Are you working 10+ hours a day on your campaigns? Still grinding until the wee hours of the night? It doesn’t have to be this way.
Charles was in this position several years ago, and now he runs 2 multi-million dollar companies while building his brand. His secret sauce? Systems Thinking. He’ll show you practical examples on how you can build systems in your company so you can make MORE profit with LESS work.
Charles Ngo Speech Transcript
Hi everyone. Thank you Affiliate World for hosting me. Thank you guys for coming here.
Ten years ago I was introduced to affiliate marketing with a book. And this book, it not only showed me the power of internet marketing but also showed that there’s more to life than just money.
It showed me the power of freedom and time.
And this book was The 4-Hour Workweek.
Raise your hand if you guys have read that book. I can see why 50% have read that book.
And what’s interesting about this book is, it only took me a year to quit my job and become successful at affiliate marketing. After a year at affiliate marketing, I was miserable.
Do you know why I was miserable?
Because I thought I was gonna live the 4-Hour Workweek. Instead, I got four hours of sleep every single week.
This book, it kinda made me realise that something was kinda wrong with my business. Because the reality of affiliate marketing is that, it’s a lot tougher.
Even though you have your first profitable campaign, it only gets worse. You guys right now, you’re in Berlin. And right after this speech you’re gonna go out, you’re gonna log to your phone and you’re gonna check your volume stats.
Because you are worried about what’s gonna happen to your campaign whenever you guys travel, you’re at a conference or you’re doing something. Because the ads are not being uploaded, things are not gonna be optimized.
And it kind of feels like your campaigns are in a house of cards.
What’s interesting is we escaped the world of living paycheck to paycheck but a lot of affiliates are actually living campaign to campaign which is almost the same thing.
The Life OF A Typical Affiliate Marketer
The life of a typical affiliate marketer, once you have a profitable campaign, it’s not as stable because offers go down, your account gets banned, stuff happens.
My question is, what’s the solution to this?
And the typical solution everyone says, “You need a team, right?”
I mean, there’s been plenty of speeches, you need a team. Everyone says that on blogs and forums.
But it’s a lot harder than it looks. Here’s the reality of a team.
The Reality Of Building A Team
The truth is when you build a team, you got to find people, you have to hire them, you have to train them, and you have to manage them. And on top of this, you have to deal with something called emotions which complicates everything.
That’s kind of what happened with me 8 years ago when I first started building a team. I thought, “Okay, I’m gonna build a team and these guys, they’re gonna run campaigns for me. I’m gonna get all the money, I can travel and sip piña coladas.”
But, here’s what happened. I would train some guys and after a few months to it, run off on my campaigns.
I would train some guys and they would constantly ask me questions about everything.
It is like, “Charles, this landing page went down what do I do? This page is not making any money what do I do?”
And what I realise is building a team is a lot harder than I thought.
For most of you guys, what happens is, you build a team, completely fails. And whose fault is it?
It’s just not my fault, this guy’s an idiot. This guy’s not trustworthy. We blame the people we hire. And we think it’s a people problem.
That’s exactly what happened to me. I gave up on a team for a few years.
I just thought to myself, “Okay team’s not for me, I’m just gonna do everything by myself.”
The Big Discovery
A few years later, I had a big discovery.
I was at McDonald’s, I wasn’t eating there I needed Wi-Fi. So, I was at McDonald’s and here’s what I notice about McDonald’s.
One of the biggest brands in the world. Let’s talk about their employees. Not exactly the smartest people in the world. No offense if you work at McDonald’s.
Not only that but did you know their turnover rate is 44%?
That’s kind of when I realise it. How can McDonald’s be one of the biggest brands in the world? They have bad people, a high turnover rate. Yet, any McDonald’s you go in the world, everything’s gonna be consistent.
There’s gonna be someone there asking if they can supersize your meal. And, there’s gonna be someone there that can make your Big Mac that’s gonna taste the same everywhere.
Everywhere you go the bathroom is always clean, in theory.
Solution: Systems Thinking
That’s when I realised, it’s not just about the team. It’s about the systems. That was the missing link that I didn’t have that a lot of people that try to build teams don’t have.
Because if you think about it, this is a cell phone. And a cell phone by itself can’t run without an operating system. That’s kind of like your team.
You have the people but you don’t have some kind of manual or a system or instructions on how they should run everything.
That’s kind of why when you build a team, they kind of run around like a chicken with their heads cut off.
The solution is systems thinking.
When I realise the solution with systems thinking, it’s not like I could buy an e-book or a guru course that can teach about systems thinking. I had to study outside of affiliate marketing.
I had to read books. I study McDonald’s, I study Toyota. And, I studied all these different businesses and I brought a lot of teachings back to affiliate marketing. And that’s very important.
A little off topic but, if you want to improve as an affiliate marketer you just can’t read blogs. You can’t just read forums.
Forums and blogs they’re great but they’re meant to be a supplement.
Because if you’re learning from the same source everyone else is, what’s your competitive advantage? You have to go outside.
So, for me personally, I study real businesses, I study startups.
Because I can take that knowledge from outside and I bring it back to affiliate marketing. I do pretty well for myself.
But why would you study me when you can study a billionaire? Do you know what I mean? Make sure you expand your knowledge.
What’s A System
Here’s the Wikipedia definition of a system. To summarise it up, it’s a set of procedures designed to create a consistent outcome.
And, here’s the biggest mind shift I had because for me systems thinking came naturally. For others, it won’t be so natural.
Everything you do in life, everything is a system.
Your body has your digestive system, cardiovascular system, skeletal system, all this combined. You’re walking, you’re breathing.
I mean, this conference is a magnificent conference. Trust me, there’s a lot of systems that you guys don’t see that’s required to build up this.
The Components Of A System
Here’s the way I look at systems. Here’s the framework I use. An input plus the process equals the output.
And all this creates a feedback loop so you can improve it.
The best analogy I can give you is to think of everything like a factory. You combine the raw ingredients, you put it on the assembly line. And on the assembly line, humans and machines will work to create you a consistent product, the output.
In this case, tomatoes plus vinegar plus salt, and the process is where you crush the tomatoes and bottle it up results in ketchup.
Here’s a simple framework but everything in life revolves around this kind of framework.
Let me give you a more practical example. Let’s talk about being productive.
You wake up in the morning, you already have a system whether you know it or not. It’s either good or bad. If you wake up in the morning, you hit the snooze 5 times.
And then you’re in bed checking stats and checking Reddit and checking Facebook for another hour. Then you go eat some fruity pebbles in the morning.
That is a system whether you know it or not. It’s not a very good one.
Creating A Morning Routine
So here’s a better system. The input is me. And then how the process is making coffee, morning run, I meditate, I shower, I plan a day. And that equals a more productive version of me.
Once you have the framework out, you can take out different areas and you can prove it. If the meditation doesn’t help, replace it with something else.
Here’s another example.
You input in the ingredients, put the processes in and then you get spaghetti.
Campaign Launching System
How does this work for affiliate marketing? You have your inputting raw ingredients. The ingredients are Traffic source, Landing Page, Offer, Ads, Angle and of course, you gotta fund the campaigns.
Then, you have the processes. Now, this is a very simplified version. But the processes can include split testing landing page, adjusting the bids, cutting the placements, split testing new offers and adding in new angles.
And in theory, hopefully, you get a profitable campaign.
This is a very interesting framework. I have a lot of people that think, I teach affiliate marketing and a lot of people, it’s very frustrating to learn affiliate marketing.
One common mistake I see people make is they think there’s some kind of big secret. It is like, “Charles, what’s the traffic source? What’s the hit? What’s the secret traffic source?”
I also have some other people that get frustrated because they have the traffic source, they’ll use some spy tools. They’re like “Hey, I’m on this traffic source, I’m ripping off the same landing page everyone else is using, why are they making money and I’m not?”
A fair question. What you got to understand is you have the traffic source in a landing page but what’s your process like?
How are you bidding, how are you cutting placements?
Something I tell people is the traffic source doesn’t suck. You suck. Your processes suck.
What’s great is if you’re able to dissect and break it down, then you could figure out and optimise each process.
Another analogy is like steak. You have a grade a piece of Wagyu steak and then you cook it and you burn it up.
Don’t blame the tools, don’t blame the ingredients. Your process sucked.
Benefits Of Systems In Affiliate Marketing
Here are the benefits of systems in affiliate marketing.
Here’s a simple story. I know a lot of friends that started restaurants. They were great chefs and I’m doing a lot of chef’s analogy because I’m a mobile cookbook.
They are great chefs and what ended up happening is the restaurants ended up dying. You know why?
Because even though they were great chefs, the problem is they were the bottleneck. They insisted on cooking everything themselves.
When you create the system, think of it as you’re creating the recipe. If you’re the one cooking all the time, there’s a bottleneck. You’re not able to focus on marketing, you’re not able to focus on the stuff that really creates a business.
So, if you’re cooking all the time, that’s a mistake. Instead, you should focus on creating ingredients. So you know how to cook, right?
But if you focus on creating the recipes, and then you build a team to execute, now you have all the free time to actually run the company.
How does this apply to affiliate marketing?
Focus On Creating Recipe
Well, if you’re the one uploading ads, you’re the one doing all this low-level work, you’re the bottleneck in your own company.
That’s why a lot of people, they hit a plateau in affiliate marketing.
Here’s something I realised. To get to $1,000 a day, you can get to $1,000 a day by yourself. It requires a traffic source, offer, angle, and landing page.
You have those 4 ingredients combined, you’ll hit $1,000 a day.
But that’s not how you hit $10,000 a day. $10,000 a day requires a team, a system, competitive edges, and accounts. Just kidding.
That’s what I mean. When you’re doing this by yourself, of course, there’s a natural plateau to get to the next level.
Because, here’s something I realised this year. We’re living 2016, we’re in a generation of perfect information.
When I first started, there were hidden traffic sources, there were hidden landing pages. Now, due to a very good spy tools, everything is out and open.
So, instead, you can’t think of your edge as hiding information.
One way is, how fast can you launch campaigns? How many campaigns can run?
If you have a campaign that’s like doing $500 a day, well, you can just scale it to multiple countries, multiple traffic sources. But if you’re by yourself, there’s a limit at how much you can scale, right?
Here are the benefits of the system.
Benefits Of A System: Repeatable
First one is it repeatable which means you can easily teach it to others. Fewer errors, so it creates predictability.
Like, one thing I really do a lot in life is a checklist. It makes employees more efficient. This is a big one.
People make mistakes. I make mistakes. Everyone makes mistakes.
If you have these checklists and all these instructions, they’re gonna make fewer mistakes. And also makes onboarding off-boarding easier.
Here’s a big aha moment. Employees come and go especially in affiliate marketing. But the systems you build are an asset.
So, newbie Timmy leaves, but the system stays. So the next person you come in, you don’t have to spend that much time training him.
And then finally it’s less management because, how can I focus on the bigger picture if people are asking me all these low-level questions like, “Hey, the servers down, how do I set up a DNS?”
Why Build Systems
Ultimately, I do this because I’m lazy but I’m smart. I know that if I spend 1-hour building a system, I can save 50 hours of my time.
And that 49 hours I save, I sleep, I watch Netflix, I take bubble baths.
Systems save you money. It prevents you from being the own bottleneck in your company. And, systems, you scale.
Finally, less decision fatigue.
One more high-level mindset. I know a lot of people have Superman syndrome where they don’t want to delegate anything. Keep this in mind, the person only has to do the job 70% as good as you, that’s my rule, 70%.
Because a lot of people, they delegate to someone and they don’t do it as well. And they get pissed off.
The truth is if you’ve done something a hundred times and they’ve never done it before, how can they do it as well as you?
They can’t. So, my goal was 70% because there are so many things we should be doing in our companies that we’re not doing because we don’t have the manpower.
For someone who does it 70%, is better than not doing at all. You have to trust that over time with an experience they can improve.
Of course, in affiliate marketing, understand the concept of higher leverage activities. I remember one of my friends made a lot of money in affiliate marketing. And then he ended up going back to a 9-to-5 job. Why?
Because he didn’t understand taxes and cash management. He made all this money, but in the end, because he didn’t focus on managing his cash, he didn’t have time left over to pay. And, he didn’t have any money left over to pay the IRS.
That’s kind of like the bigger picture guys. If you’re focusing on cooking the food all the time, you don’t have time to run the business.
Running the business is a higher leverage networking strategy. Managing your cash, hiring.
Different Levels Of Systems
Ultimately, remember, there are different levels of systems. A common mistake I see people make is they build a system, it doesn’t work, then they abandon the system altogether.
Realise, there’s level 1, level 2, level 3. And the point is you constantly reiterate and keep improving.
Here’s an example of one system in affiliate marketing.
Let’s say you want to find hot offers. There are multiple ways to find hot offers but the key to finding “hot offers” is to combine everything into a consistent pattern.
For instance, you could have one guy in charge of finding hot offers every week. First thing he does, checks out all the spy tools, compiles a list of like, “Holy crap, I’ve never seen this offer before we should jump on it.”
Number two, signs up to all the affiliate networks. And, you know they highly spam the emails every single day. The hot offers will combine an aggregate report.
The third is he can talk to different people. What this means is, for me, every single Friday, we have a 10-minute meeting. “Charles, here’s what’s hot.”
Because of this, it’s all about speed implementation. I want to go where the puck is going. Not to where it’s already been.
Information is important. I see a lot of guys are like, newbie Timmy will be like, “Hey Charles, you know this offer, is this hot?”
I’m like, “Dude, this was hot three years ago.” So, you guys stay on top of things.
Translate A Landing Page
Here’s another one. Here’s another example. Translate a landing page.
I use this because I absolutely hated translating landing pages. And is a very easy thing to outsource.
Here’s the first thing I do whenever I do documentation. What’s the outcome you want, what’s the purpose? And, what resources do they need?
Another one I forgot to add on the slide is the why?
This is actually very important when you’re explaining things to people, the why.
The why is important because people don’t like to do basic work. They want to know why this is important.
For me, I could say, “Hey, you translating the landing page may sound basic but it’s very important to operations because 80% of our traffic is international.”
Could you imagine you’re reading a landing page and the English are not proper or the language is not proper? That’s why it’s important. When they understand why it’s important, now they’re going to put in the work.
Translate A Landing Page – Procedures
Then, what I would do is just create the documentation, list out the steps. Show some screenshots.
Here’s something else that’s very important.
Everything I do I screencast it. Just use ScreenFlow. You’re showing someone how to set up volume, just screencast the whole thing. You’re doing it anyway.
So, you screencast it. And then what I do next.
How To Delegate
Here’s another example, how to delegate. How to delegate matters quite a bit. What I notice with a lot of people is, “Hey, just do this. Just do X.”
What ends up happening is this person spends 5 hours doing a task and it’s completely wrong. And, you just wasted 5 hours of his time.
Instead, if you just spent 10 minutes writing the proper way on how to delegate and you ask them if they have any questions, you end up saving 5 hours of time.
Spend that extra time and make sure they understand the activity.
Here are the steps I use. First is I record the procedure using a Screencast, ScreenFlow or Jing. I have them document it. This is important.
I don’t document it mainly because I’m lazy and I want them to do all the work.
But the second reason is because when they write it down, they learn it more. And then they have any questions, they can talk to you.
Next is the test drive the SOP on someone. Let them do it.
Fourth is once they’re done with the landing pages or whatever it is, what’s the outcome? Is that appropriate?
If they messed it up, you have to go back and figure out what went wrong.
Number 5 is, debrief. How is the SOP? Did you understand it? What could have improved?
Number 6 you have to make iterations.
And then, number 7, just like I said, it’s all about constant improvement, constant feedback, and constant improvement. You can’t expect it to be right the first time.
Think of it as level 1, level 2, level 3. And what’s great is, if you have the right person, they’re the kind of person that keeps improving it.
Like I said, if this person ends up leaving, or what if they’re sick, whether they’re on vacation for a month, someone else can easily jump in.
“Okay, this is how I optimise on Facebook. Okay, this is how I optimise on pops.”
It’s like all there.
Picking What To Systemise
Next question you guys probably have is what do you systemize? Because there’s like a lot of things in your business to systemise.
The first question I ask, what’s the 80/20? You wanna systemise like changing a color your button on your landing page that doesn’t affect the business.
Focus on what actually matters.
B, what’s the constraint or bottleneck. What’s holding you guys back?
C, this matters a lot to me but what is something I’m doing already that I don’t like doing?
Because I remember back in a day, an affiliate manager would tell me that this offer is hot. And, I wouldn’t launch it for 2 months.
When I launch it, I’m making all this money. I’m like, “F*ck, if I just launched it 2 months ago, I would’ve made all this money.”
But I didn’t launch it because I hate making banners, right?
And D, when you’re launching campaign what’s holding you back from doing it?
5 Decisions To Make
Five decisions alike.
That just happens more than once a week. Remember the analogy of creating a recipe? You want to create a recipe for something you’re doing a lot.
So if you’re making like bread every single night, then it makes sense to systemise the bread making.
But if you’re making like a birthday cake that only comes out once a month, you shouldn’t systemise that.
Is this easy to teach?
Whenever I systemise, I teach people stuff like optimisation probably comes last.
Because it’s a little bit harder to teach. But something like translating a landing page, uploading an ad to a server, uploading a banner, that’s relatively easy.
Here’s a quick example of how I would do things.
You use Excel and I would list out everything I have to do to launch a campaign. The next time you guys launch a campaign, literally write down all the steps, everything.
I wish just had a pointer. And then, from there, how long does it take you?
And then, also, want to ask myself, how much of a pain is this?
Then, is this easy to teach? Then, you can come up with a formula real quick to see what you should systemise out.
Like I said, I understand that there are all these fires but you have to put the fires out. Like the biggest ones.
That’s the whole point of the system. Because a lot of affiliate marketers right now, you’re in a state of reaction.
You’re in a state of reaction where there are all these fires everywhere. And you’re constantly in a state of putting the fires out.
Just when you become profitable, the offer goes down. And, just when you become profitable like something happens. Instead of killing fires, you have to take the time to step back from your business and build systems to prevent fires.
How about you step back, install some sprinklers. Install fire extinguishers everywhere. Fireproof a lot of stuff. That’s the analogy I like to use.
If This, Then That (Triggers)
Various decisions. Here’s one framework I like, if this, then that.
If a customer orders a sandwich, would you like fries with that? One behaviour triggers another.
Another one is, if the customer abandons a shopping cart, they automatically get an email to remind them. Or, they automatically get an email like, “Hey, you abandon your shopping cart. Here’s 10% off, come back and join.”
You implement this once but then it keeps printing money for you every single day. If someone’s interested in chatting with me, then my assistant would schedule a meeting on my calendar for Skype.
Number 2, time-based system.
This one’s relatively easy. I publish a blog post every single Thursday.
Let’s say, you have a favourite affiliate manager, talk to them every Friday at 2 p.m. Put in your calendar, put in their calendar.
Do laundry every Sunday. Very simple systems.
Three is very interesting. Triggers based off of metrics. Now, this is how you start systemising your optimisation.
Something I want to point out real quick because everyone asked me for formulas and stuff, formulas were differ depending on the traffic source.
How you, because I know everyone is like, “Ok 3x payout minus this blah blah blah,” is different on Facebook. It’s different on mobile, it’s different each one.
You have to create an optimisation system for each traffic source. Even each vertical.
Here are some examples. The first two are pretty self-explanatory.
Number 2, on Facebook, if one of our banners goes below 1%, then automatically upload 2 banners.
You see before they were like, “Hey Charles do I need to upload a new ad or something?” Now, it is less than 1%, they automatically do it.
That frees up my time to focus on better stuff, like Snapchatting.
On my blog, I have a pop-up. If the opt-in rate is less than 8%, create and split test the lead magnet. And they already have the procedures on how to do that.
It’s kind of like, I have robots. And anyone that does funnels or Infusionsoft, I love marketing automation, but it’s like, I have a salesman working for me 24/7.
That’s the way I think about this.
Here’s a great one, decision-making guidelines. At the Ritz-Carlton, a very fancy hotel, any staff even the janitor, they can spend up to $2,000 to fix any complaints.
They don’t have to talk to their manager and stuff. They just know what to do when it comes to decisions.
At my companies, any staff can spend up to $300 at their discretion if it’s gonna help them make more money.
They need a new keyboard, they need a new book or something. Just go ahead buy it, you don’t have to ask me for permission.
I got this from Tim Ferriss where at his old company if a customer complained and they can fix it for less than $100 go ahead and do it. That freed up his time.
And finally, Big Z, Mark Zuckerberg, a very fashionable man. He wears the same shirt every single day.
He systemised his decision making that way. He can focus his brain on more important things, decision fatigue.
Here’s something else a little bit more advanced.
Number 1, software is always better than humans. That software is better than humans. If there’s any way, for instance, let’s talk about spy tools.
Like, you know how long it would take for us to manually spy stuff? Take ages versus if you have a good spy tool, boom. You log in, sort everything, boom, boom.
If you can, I notice a lot of affiliates, once they get the highest level, they don’t know what to do next. Try investing automation, try investing custom software. It will save you a lot of time.
Because humans get drunk. Software doesn’t get drunk. Unless you have a really weird software
Second, like I said I don’t create my own SOPs. I demonstrate and I let other people create the SOPs. However, I do check up on it.
I want to emphasise this because a lot of you guys are gonna be like, good systems sound great but I’ll have no time to do systems.
Well, you’re not doing the system, you’re just doing what you’re already doing and you’re just recording it and you’re having someone else do it.
Software and Tools
Some software I like for screencast, I like Screenflow or Jing. For storing the SOPs, I like Confluence or Process.st.
Now, don’t get complicated with software. If you’re not making much money, you spent all your money to come to AWE, just use Google Docs. Don’t get complicated guys.
And project management, I like Wrike. Keep it simple, guys. Don’t come up to me after this. “Hey, Charles, why do you not use Asana over Wrike?”
Just use whatever you want to use. It doesn’t matter.
This is kind of like a crash course on systems thinking. Systems thinking is like really complicated.
So one thing that really helps is reading books. Here are all the books I read that helped me develop this mindset.
Unfortunately, I’m not getting an affiliate commission from this. But feel free to take a screenshot and buy these books.
I really like Work The System and Thinking of Systems, are probably the top two books. If you don’t have time to read 7, I would probably go with Work The System and Thinking Systems.
All right, where to find me, you guys know where to find me.
Additional resources, if you guys want my slides, more information, my templates, and stuff, Charlesngo.com/systems. And then I can send you the stuff.