4 Biz Lessons from Ferrari

From Lyndon’s Thursday email – sign up here (image generated by copilot)

Ferrari has successfully built a car company where they can charge an incredible premium on every car they sell, while also being aspirational to millions of people. Let’s look at 4 things our businesses can do based on strategies Ferrari has used to get them to where they are today.

Okay, so full transparency, I’ve never been a Ferrari Stan. I think they’re well made cars, but honestly never understood the hype. But over the last two weeks, I keep seeing them and their branding, in many different places. For example over the last 10 days:

• Jo painted her nails Ferrari Red (they have a color named after them)
• At a thrift store in Broad Ripple, I saw a pair of Ferrari/Adidas cleats (have you ever seen people proud of their “Chevy” cleats … yea me neither)
• A YouTuber I follow started a video with an incredible hook, “Last month I quit my job, but today – we’re buying a Ferrari” (the brand is what makes this statement wild)
• And lastly, my current favorite podcast My First Million did a stock picking episode where Sam (one of the hosts) broke down how cool of a company Ferrari is and maybe not a great buy right now..

Let’s look at 4 things that make Ferrari different and what we can learn from them – I’ll add time stamps where they talk about the ideas I’m riffing on in the My First Million podcast, cause I, Lyndon, love a good source, and can’t help myself.

Enzo used his passion to create something unique (34:00)

Enzo Ferrari – Ferrari’s founder – was a race car driver who wanted a better car to drive. He was clear that it was about performance and being the best. In Sam’s words in Enzo’s first year, he was obsessed with making a great engine, everything else be damned.

Being able to focus on optimizing for performance over time he was able to build an empire in racing and performance vehicles while charging a massive premium to people who valued the same things that he did (today that means around $100k+ profit on most cars they sell).

Since we’re on vehicles – both Tesla & Rivian have followed similar playbooks of being very specific on how they were different through focusing on innovative tech & outdoor adventure respectively. Their client bases are willing to pay a premium for the niche they’re interested in.

What does this mean for you as a photographer:

• Doing the same sessions as everyone else doesn’t differentiate you, focus on what you’re passionate about and build that into your package as an edge on how you’re different
• For example, as marketing nerds (who also run an agency) we have a passion for marketing on Instagram specifically, as part of our strategy calls for our sessions we talk about what kind of content our clients will be creating so that we can tailor the photos & videos we get to match what they’ll be posting & we offer an upsell of a consult call after their session to plan out a month of posts with the content they now have

You don’t choose Ferrari, Ferrari chooses you (37:00)

For “base” Ferrari’s, still very expensive, most people can “just” walk into a dealership and buy one. But if you want to buy one of the more premium models there’s a waitlist, and generally, you have to buy 3-4 “base” Ferraris to even be considered for one of the premium models.

This is directly an exclusivity play, if Ferrari wanted to they could ramp up production and sell a car to everyone on the list. But part of the value of being a luxury brand is because there isn’t enough to go around to everyone.

Shaan (the other host) “Nothing makes me want to get in more than a wall preventing me from getting in”

As a photographer are there some premium offers you’d love to create, but don’t want them available to everyone?

• Think about doing the same thing as Ferrari, to even be considered for a premium offer one of the conditions could be that people have worked with you before. This is also a way to have a much better idea of if someone would be a good fit for a premium offer.
• You can switch to being application-based rather than strictly a waitlist that guarantees someone the ability to purchase when spots open up (a perfect example of how we do this: Jo’s email last week outlined how we turned down a client who wanted to pay us $2600)
• Also think about limited (time, or quantity) drops

Around 65% of Ferrari’s sell to someone that already own’s a Ferrari (40:00)

For car’s that sell in the hundred’s of thousands of dollar’s, my intuition says, it feels like you’d be looking to convert new clients since those customers have already spent so much with you. It’s actually the opposite, there are more repeat buyers than first time buyers.

People that are already bought into your business & are loyal to you are oftentimes easier to sell to than new customers. That doesn’t always mean just selling cars (your primary offer). According to beloved-brands, “branded merchandise accounts for $1.5 – $2 billion in sales each year. That’s a significant contribution to Ferrari’s $4 – $5 billion in revenue each year.”

To recap, almost half, of Ferrari’s revenue comes from branded merchandise (read: Not Cars). They’ve diversified in ways of both providing extra “value”, I’m not sure a $600 baseball cap is actually thaaaat valuable 🤷‍♂️*,* and creating things their previous (and future) customers are excited about buying.

Umm… I’ll probably never sell $2 billion in merch, what does this mean to me as a photographer?

• Think about your offers as complimentary to each other, to use an analogy, if you’re main offer was the main course of a meal, what would be the appetizers, desserts, drinks, & sides that pair great with it. (ex: merch, implementation support, pdf’s, paid referral to someone else’s offer.. we have a bunch of low lift ideas in our cash injection cheat sheet freebie)
• To follow the food analogy, can you create a routine or habit around working with you? I’m directly thinking of “Taco Tuesdays” and “It’s Five O’Clock Somewhere”, they stick in people’s head, become part of a routine, and make it easy to want to buy from the same restaurant over and over as repeat customers. For you, this could be things like; low dollar stock content subscriptions, weekly/monthly drops of trending content ideas/templates, or hosting weekly/monthly co-working calls with your clients.

Ferrari has a bounty program to maintain their brand (41:00)

At this point Ferrari’s brand is worth a tremendous amount, and so last year they rolled out a bounty program or effectively you can get rewarded for reporting someone that is infringing on Ferrari’s brand. It’s mostly about reporting knock off merch, but can also be people with mods on their cars that aren’t allowed by the terms & conditions you sign when you buy a Ferrari (fun fact: a celebrity just lost a lawsuit and had to pay Ferrari $350k for painting their car and posting it on social media, since Ferrari said it damaged their brand @38:30).

This is a perfect example of mobilizing their loyal fans to do a ton of the leg work for them of maintaining their brand identity.

I’m not gonna recommend you mobilize your audience to snitch on things for you … I’d be curious what you’d ask your audience to snitch about tho…? Hit reply comment below lets chat about this 😂

So if not snitching why are we chatting about this? You can incentivize your audience to do other things that can directly help your business

• I forwarded someone a part time job posting last week, because she had made it known to us that she was looking for copywriting work
• How can you incentivize your audience to make you aware of opportunities that might be a good fit for you? (For example: I’ll commit to giving you a starbucks gift card if someone books with us based on something as simple as you sharing their IG story like “looking for a biz coach” or “in need of brand photographer” – be clear what counts as success, and how you’ll “pay out” on your bounty)

TL;DR: Ferrari teaches us to:

1. Use our passion to differentiate our offers & brand rather than just being the same as everyone else
2. Leverage exclusivity to both vet customers and drive more interest to higher ticket premium offers
3. Your current & past customers already know you, and may be easier to sell more things to
4. Use a bounty program to mobilize your audience to bring opportunities to your attention

If you’re a Ferrari Stan, did you already know all of this and I’m just late to the game? Also I’d love it if you real quickly hit reply comment below and let me know which one of these four are you most likely to implement in your business and how? There’s so much potential here.

Since I went down the rabbit hole on a My First Million episode, here’s two other episodes that I’d recommend if you’re interested in checking them out.

Become A Better Writer in 60 Minutes (Masterclass) – Both Sam & Shaan have sold multi-million dollar email newsletters, so I found it really interesting how they think about writing for the internet age rather than what we learned about writing essays in highschool & college spoiler throw out some of what you believe

How We Got Our First 100 Customers (No Bulls**t, Specific Details) – As serial entropreneurs that have both scaled multiple companies to million dollar plus businesses, it’s interesting to hear them break down how they got their first customers in slightly different ways at each business, and a number of strategies I’m now debating trying in our business.

Ps: have you seen the movie Ferrari with Adam Driver playing Enzo Ferrari that came out last year? I haven’t seen it, but now I really want to based on learning all of this.