(Entrepreneurship )

The Power of Magical Thinking (For Business Growth)

Magical thinking is a term for sales psychology, a skill every entrepreneur must use. The best negotiators can't compete with businesses offering great value at fair prices.

Ryan Chute
Ryan Chute
July 15, 2022
The Power of Magical Thinking (For Business Growth)

Ask any business owner, contractor, or entrepreneur you know, and they'll 100% agree that it's facts, figures, and logic that matters when running a company. They're absolutely right. Analytical thinking is a predominant driver in business, but what they might not realize is that magical thinking is a powerful tool for business growth, too. Wait, what? Allow me to retort. Businesses want consumers to believe that their products or services will make them happier. That means soothing a pain point or caressing a pleasure point. This is what magical thinking is all about. It’s a form of psychological persuasion aimed at transforming externally motivated, grudge-driven buyers into happy customers. Intrigued? Let’s take a closer look into magical thinking and how you can implement the mental game for your residential home service business.

Win the Heart, the Mind will Follow

Magical thinking is the belief that our thoughts, words, and actions can influence the world around us in ways that are seemingly unrelated or illogical. This type of thinking has been linked to success in various areas of life, including business. Come to think of it, people see something they want and they buy it, believing that it will improve their lives one way or another. In Roy H. Williams’ Monday morning memo, he said: _“The mind will always create logic to justify what the heart has already decided.” That’s a universal truth of business. Everyone who steps foot into a store already harbors internally motivated perceptual reality. In a customer’s mind, they may be looking for products that make them look pretty, or fidgeting through the latest and greatest tech, or embodying that beach body just in time for summer. Like waving the red cape on a raging bull, there’s no stopping a customer once their heart latches onto the desired outcome. The aim of magical thinking is to relate to your client's perceptual reality. By infiltrating their thoughts, illustrating how your products or services will have their felt needs MET (money, energy, and time), and satisfying their pain and pleasure points, you will have better odds of selling your solution. Looking for a magical-thinking expert that can help leverage your residential home service business? Watch your sales skyrocket through Wizard of Ads® proven skills in psychological persuasion. Book a call.

Documentation of Brain Lateralization

Documentation of Brain Lateralization

The concept of magical thinking follows closely the theory of brain lateralization, introduced by Dr. Roger Sperry. According to the Nobel Prize winner, the brain isn’t simply divided into two hemispheres but is composed of two competing and practically independent minds. Below we’ll explain how brain lateralization works and describe how they relate to marketing and business.

The Left Brain

The left hemisphere, otherwise known as the digital brain, houses the human ability to be verbal, analytical, factual, and orderly. Based on Sperry’s research, the left brain helps people with:

  • Logic or deductive reasoning
  • Reading
  • Writing
  • Computing
  • Sequencing
  • Linear or systematic thinking

The left hemisphere understands fact from fiction. What’s real and what’s fake. It’s the part of the brain that links people to the real world and leans towards suspicion and doubt. In business, the left brain is the part that rationalizes every purchase decision that customers make. This is more evident during grudge purchases like in residential home services. Your customers don’t find pleasure in hiring you. They simply want a contractor that will help have their felt needs MET (money, energy, and time).

The Right Brain

The right hemisphere, also known as the analog brain, is the part believed to be more visual and intuitive than the left hemisphere. Unlike, its counterpart, the right brain is less orderly but more creative. Sperry suggests it helps people with:

  • Feelings
  • Holistic thinking
  • Imagination
  • Intuition
  • Artistry
  • Music

Revisiting Roy H. Williams’ quote earlier, you may imagine the right hemisphere functioning as the heart. It harbors every desire, dream, and yearning of a person. Unlike the left brain, the right hemisphere connects you to a desirable world where a customer’s perceptual reality comes to life. Here’s the rub. Despite any customer attempt to rationalize their purchase decision, a business owner who masters the craft of magical thinking can guide prospects into a desirable mindset - from an externally triggered cause to an internally motivated purchase decision. You’ll learn how below.

How to Use Magical Thinking

How to Use Magical Thinking

Magical thinking is a useful skill to learn for all types of businesses, but most especially, those that belong to residential home services. As opposed to conventional businesses like health and beauty where people WANT what they sell, you’re selling an externally triggered grudge purchase. In other words, people don’t want to avail your products or services, they have to. Unlike new bling, it’s hard to imagine a customer flaunting her new unclogged toilet. These ‘unsexy necessities’ are the reason why selling home services is more challenging. People would rather spend on things that align with their innate impulses. They want things they can show off. Even if internally motivated and externally triggered purchases have their differences, they share one thing in common: desirable outcomes. Customers may not obtain instant gratification from a grudge purchase, but underneath their annoyed exterior, they’re still after an advantageous perceptual reality. Whether that’s the kiss of cold air of a new HVAC system or the shimmer of a well-illuminated room. This is where magical thinking shines through. Another word for magical thinking is cognitive distortion because you want to distort customers’ cognitive motivations away from the angle of necessity (why they need the solution) into the angle of advantage (how the solution will make them feel). In magical thinking, it’s not enough to give your prospects a detailed list of your product features and benefits. Your task is to identify the features that make them FEEL, walk them through the benefits they will reap, and link their feelings to their desired perceptual reality. Once they feel the advantages of having your product or service, they’ll be more inclined to choose your solution. Why? Because people’s decision-making is anchored in the part of their brain that HOPES and EXCLUSIVELY FEELS (right brain). You can incite that emotion through magical thinking.

You Need A Frustration-Free Solution

In any case, there are perks to selling home services that other industries don’t offer. For example, if a prospect experiences a breakdown, they don't have to be convinced to take action. Anyone in need is already highly motivated to purchase from people who can help them — that’s you. All you have to do is persuade them to choose YOU. What makes your solutions better than your competitors? Even with all the social psychology magical thinking you employ, unless your products or services don’t ease their pain points or satisfy their pleasure points, don’t expect a sale. You can’t sell something that doesn’t solve their felt needs. At the core of your competitive advantage is an irresistible value proposition. This is not merely a feature or a benefit that makes your products attractive to consumers. Your value proposition embodies that value you promise to deliver, the pain and pleasure points you aim to please, and the positive impact your solution has on their money, energy, and time if they decide to buy your solutions. What is your value proposition, then?In a grudge-purchase-battlefield like the residential home service industry, most customers seek affordability. All things being equal, customers will gravitate toward companies that charge cheap. A lower price for your home services is a low bar to entry in a saturated market and you’ll be forced to compete in the market share with countless others like you. In that case, a lower price as your value proposition isn’t ideal, whereas, if you bump up the price tag in exchange for a tremendously huge value, you will influence the demand in a much more powerful way than by selling cheap. I call this your perfectly fair competitive advantage. _A lifetime non-prorated service warranty? Waiving the diagnostic fee if they decide to hire your services? Free unlimited drain cleaning if they sign up for your club membership? A 10-year no-risk lemon replacement guarantee if the same thing breaks 3 times? Whatever it is, your value proposition should set you apart from the competition. You need to make them think that they’re getting more value from the sale than what you are willing to offer. When you create a unique offer that your competitors refuse to do, you establish a perfectly fair competitive advantage. Craft a unique value proposition combined with genuine self-imposed punishment should you fail to deliver on your promises, woven in a magical thinking offer — you become the front runner among your competitors for a sale.

Want to employ the Power of Magical Thinking_

Want to employ the Power of Magical Thinking?

Magical thinking is a fancy word to describe sales psychology, which is a skill every entrepreneur must be comfortable employing. But even the best negotiators pale in comparison to businesses that are willing to offer immense value at reasonable prices. To be the residential home service leader in your community, create a tremendously irresistible value that’s easy to say “yes” to. Drizzle psychological persuasion over, and the market is yours for the taking. Leverage your residential home services through magical thinking. If you need help, book a call with Ryan Chute at the Wizard of Ads® and watch your sales accelerate by multiples.

(Magical Thinking)
(SEO Content)
(Business Advice)
(Growing Business)
Ryan Chute
Ryan Chute

Helping small businesses become BIG brands with a holistic marketing strategy that speaks the same language across all sales and marketing channels.

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Frequently asked questions

Questions? We’ve got answers.

Who does the Wizard of Ads® for Contractors work with?

Wizard of Ads® for Contractors work with healthy and growing Residential Home Service Contractors hungry to grow by multiples, like you.

You are ready, willing, and able to grow your business. You are open to change and are seeking a distinctive angle of approach to gain the time and attention of a too-busy public.

You know that lasting relationships take time, patience, and good energy to nurture and cultivate. We carefully enter into every arrangement with the intention of working with you for as long as you own your business. You prefer lasting partnerships.

You are already a solid operator. You have successfully grown your business and appreciate the impact the right brand story will have to get to the next level in your operation. You know a strong relational message takes time to gain momentum, but it’s worth the one-time short-term discomfort for the long-term gains.

Marketing cannot fix a failing business.

We accelerate what’s already happening in a business. If your business is on the rocks, marketing will only speed up the inevitable.  

You’re focused on lasting change that leads to exponential, profitable growth, not just sales at any cost. Intuitively, you know that communication that enhances every element of your customer's experience and your employee's culture is the key to your success.

How does the Wizard of Ads® for Contractors charge?

Traditional marketing agencies are designed to capture the greatest amount of revenue from a client, regardless of results. Every last item is billed and expensed to the client. Typical agency fees can represent a whopping 55% of the entire advertising budget. That means a $5 million dollar advertising budget, you would spend $2.75 million on agency fees.

Think of Wizard of Ads® for Contractors as the Anti-Agency.

Our income is not tied to your advertising budget. Our income is exclusively tied to your growth. Our goal is to maximize your advertising impact with the lowest reasonable spend. This allows you to spend only what is necessary or to put extra horsepower into aggressively growing in your market.

The genius of this model is that it perfectly aligns our motivations as true partners for exponential profitable growth without the pain of being unaffordable. Ultimately, we are confident in taking the risk of being underpaid in the first few years because we know the results always speak for themselves.

Next, we do not accept commissions, referral fees, kickbacks, or other compensation from any service providers we recommend or engage for production work. Most agencies do. This includes the 15% agency commission for media buying. This approach is considerably different from the compensation plan employed by most advertising agencies, as it eliminates any potential conflicts of interest and allows us to focus our entire attention on helping you grow your business profitably as a true partner. For example, a $500,000 annual media buy would involve a $75,000 commission that we would have removed directly from your media providers' invoices.

This is the perfect pricing model for Residential Home Services.

By tying ourselves to gross revenue, we only have one motivation. Your motivation. We have no motivation to convince you to spend more money on marketing than what is necessary, and since we are a variable expense to sales, we NEVER become too expensive to have us on your team.

In almost every case, we end up lowering the amount of money you spend. We will stay within your planned marketing budget, including your media spend, production, and our Annual Fee. Add on the fact that you get any and all commissions back for media buys and various services provided by outside providers, and you will actually save money having us on your team.

Don’t forget, we have the largest buying power in North America for media buying, meaning for every dollar you spend buying media, we only spend 27 cents on average. This stretches your reach, impact, and frequency in a way no other agency (or yourself) can achieve on your own, saving you hundreds of thousands of dollars, eventually millions, every single year.

Clients who heed our advice and embrace our Marketing Strategy quickly add $1 million in incremental revenue to their business, making your investment a smart bet and a bit of a no-brainer.  

There is no longer any guesswork, hope, or fear that our marketing strategies are going to work. If our client’s are able to abandon any limiting beliefs about marketing, deliver operational excellence, and play the long game, our marketing strategy will accelerate their profitable growth.

Wizard of Ads® for Contractors pricing model is based solely on the topline revenue of your company. It consists of an Upfront Fee and an Annual Fee. These fees are inclusive of scheduled travel, services, and all other expenditures as outlined in the Consulting Agreement.

The Upfront Fee covers the intensive Uncovery Process, the first year’s Media Buy, the Creative Process, and the Market Research while the Annual Fee goes toward implementation, ongoing creative and consulting, and next year's media buy. You get a team of 3.5 people, with direct access to a top tier Creative Lead and Media Buyer, and on-demand access to me as your Master Strategist. You will also have a full-time Account Manager keeping everything on track.

While the upfront does have an initial pinch, it is easy to amortize the investment over the many years we will be working together to grow your business. Wizard of Ads® retain clients for 10 years, on average. The sale of the business is the number one reason for termination. We actively terminate the bottom 1% of clients who are unwilling or unable to follow our strategies.

Wizard of Ads® for Contractors believes that all rewards should be directly correlated to the success of our clients. This means that the Wizard of Ads® for Contractors only receives a raise when the company achieves growth. For example, if your gross sales for the year have increased by 25%, the Annual Fee you pay us in the following year will also be increased by 25%. Likewise, if your gross sales decrease, our Annual Fee will decrease by the same percentage during the following year.

This is an exceptionally easy and fair way to track and reward success. This model was developed by Wizard of Ads® over 35 years ago and has served us well because it serves our clients well.

As a rule of thumb, we take the risk of working for considerably less than our actual value in the first few years as we help accelerate growth. This means you need to be willing to pay us exceptionally well when you start doing even better.

When should I engage The Wizard of Ads® for Contractors?

There are four key revenue stages for engagement with the Wizard of Ads® for Contractors.

  1. Under $3.6 million in revenue
  2. Between $3.6 and $10 million in revenue
  3. Between $10 and $20 million in revenue
  4. Over $20 million in revenue

Under $3.6 million in revenue is an investment in your brand. This will serve you well in establishing your brand story early on and help you with your name, logo, and truck wrap design. It's easier to create pictures from a story than it is to make a story based on pre-drawn pictures. You'll be glad you did. Everyone on a fast path to growth is.

Most clients start with Wizard of Ads® for Contractors between $3.6 and $10 million in revenue. They have often seen a natural ceiling with their leads for demand service and are looking for ways to push past the ceiling. This can only be done with a properly executed brand strategy, specifically in mass media with a sticky story.

Between $10 and $20 million in revenue, Wizard of Ads® for Contractors has some natural economies of scale. This is a sweet spot where Wizard of Ads® for Contractors can offer some added value in getting the ball rolling.

Over $20 million in revenue is actually the lowest cost point of entry as a percentage of revenue, but not the cheapest time to start with the Wizard of Ads® for Contractors. Leveraging all economies of scale aside, we have been left out of the upside along the way, so engaging when over $20 million in revenue means we have to mend a lot of fences damaged along the way. This is also where clients see significant savings in their media buys and production costs.

There are also three market sizes to consider.

  • Primary Markets are the top 50 cities in America.
  • Secondary Markets are the smaller cities in America.
  • Tertiary Markets are the more rural trade areas in America.

When considering an engagement with The Wizard of Ads® for Contractors, consider what size market you are in. For example, a $3.6 million company in a Primary Market will struggle to get the necessary reach needed to make a splash. You either have to be more patient than a larger company or spend more money to accelerate your reach.

Alternatively, a $5 million company in a Secondary Market will look like a pretty darn big fish in a medium-sized pond.

A $20 Million company in a Primary Market will feel like a $50 million company using our strategies to potential customers.

The key to remember is that the earlier you start with the Wizard of Ads® for Contractors, the lower the investment to get started. As they say, the best time to plant a tree was 20 years ago. The second best time is today.

Are production costs included in your fees?

The Wizard of Ads® for Contractors Creative Lead will create the ad copy, cast the voice actors, source the production house, direct the performance, pick the music bed, manage all the edits, and provide you with the completed ad for final approval before sending to air on your behalf. This is included in our fees.

You pay for the production house, actors, royalty-free music, and jingles directly to avoid any potential for markups, commissions, or management fees.

We have many friends in the industry that give our clients good deals due to the large volume of work we provide them. We will introduce you to them.

How long before a brand-forward strategy starts working?

In approximately three months of activation, we’ll just be getting live on air. In six months (3 months on air), you’ll be getting anecdotal feedback from people that you are being heard, but there will be no direct line to revenue.

After 6 months on the air, you’ll think you made the biggest mistake of your life signing up for this branding nonsense. After 9 months on the air (12 months in) you’ll see the light at the end of the tunnel.

At 12 full months on the air, you’ll know why you did this branding thing. Two years from now, we'll be clinking champagne flutes as you wonder why you didn’t do this sooner.

How long before we’re live?

The general guideline is 70-120 days, depending on the level of production needed and if there is a name change to your business.

This includes an onsite visit, a deep dive into research, and getting things created, negotiated, approved, produced, and live on the air.

  • Uncovery - 15-30 days based on travel. 1-2 days onsite.
  • Research - 30-60 days based on the scope of work.
  • Creative and Media Buy Process - 45 to 60 days
  • Offline Production - 15 days for radio. 30 - 60 days for television.
  • Online Production (if switching) - 60 days

This means planning for roughly 90 to 120 days in the proper development and production of a completely unique Marketing Strategy before anything hits the airwaves.

Are you exclusive?

Creatively, yes. During the term of this Agreement, all Creative Partners assigned to your Account shall not engage, directly or indirectly, as an employee, officer, manager, partner, consultant, agent, owner, or in any other capacity, in any competition of the client, including any company engaged in marketing consulting.

For clarity, the Creative Partner is defined as the individual Wizard of Ads® Partners who is responsible for creating your creative strategy and ongoing creative copy. Competition is defined as companies that engage in the same industry and business units (e.g., HVAC, Plumbing, etc.) as you. The market area is defined as the area where the marketing message naturally reaches through DMA or 60 miles from the city center of the client's service area(s).

Naturally, we exclude any potential future competition in markets where you are not currently active at the date of signing.

We do not limit Media Buyers in any market. Media Buyers get better deals for larger volumes, making it beneficial for the client to have the Media Buyer available to do as many buys as possible to secure the best deals on the client’s behalf.

Do you do digital marketing?

In rare circumstances, Wizard of Ads® for Contractors will provide specific digital marketing solutions. Wizard of Ads® has very specific Partners that provide digital services that serve Residential Home Services effectively. Under no circumstances will digital marketing services be offered without Wizard of Ads® for Contractors' core solution.

It is most likely that Wizard of Ads® for Contractors will work with your existing digital partners and suppliers. If you do not have a reliable digital provider, we would be happy to introduce you to a number of great providers that play nice with Wizards.

Do you do jingles?

Wizard of Ads® for Contractors can assist you in getting a jingle for your business. Like any other tactical element of a marketing strategy, we do not produce a jingle for the sake of a jingle.

If you do not have a story or a strategic reason to have a jingle...or an ad campaign to tie it to, do not waste your hard-earned money on a jingle. You are wasting your time and money.

When you do build a single unified marketing strategy that incorporates a jingle for a specific (often scientific) reason, we have a Jingle Wizard who has studied the art and science of jingle design.

He will score you an original, royalty-free jingle, including professional singers, musicians, and producers. He will not knock off a generic jingle from a publicly available music bed that sounds like everyone else's jingle.

Your jingle will serve a very specific reason and produce a very specific result. Have you guessed how much we love jingles yet?

Who owns the copyrights?

Wizard of Ads® for Contractors owns your copyright for two very specific reasons. We also provide a fair use clause in all contracts to ensure you are in no way limited to the access of your creative works, whether you are working with us or not.

The first reason we own your copyright is to ensure that we do not have to go up against our own creative works in other markets we serve. This means you are not allowed to lend, give, borrow, tweak, rent, lease, or sell your creative works to any other company at any time.

The second reason we own your copyright is that we can establish a one-time value for your creative works in the event that someone steals the content. Upon selling you the copyrights, you can go after the perpetrator for theft and make a considerable bounty in a slam dunk case.

Here is how Wizard of Ads® word the fair use of your copyright for as long as your business is in operation:

All writing and/or marketing materials we create for you are not works-for-hire. Wizard of Ads® for Contractors hereby irrevocably grants you, and your successors in interest, the non-exclusive, royalty-free, non-transferable, and worldwide right to use the Works in connection with the marketing of your business pursuant to the Marketing Strategy for so long as your business is operational.
How do I measure brand results?

There are a number of interesting ways to measure results. Some people like to get unique identifying telephone numbers, or create branded URLs that redirect to landing pages or the website. However, much of this is a waste of time and energy as it never tells the true story of the brand journey and how it affected the decision-making process.

Other indicators of brand effectiveness include tracking new customers, reactivated customers, or running a brand equity survey to get a sense of your share of mind. Digitally you will see direct search increase, which cannot be affected by anything digital, as well as branded keyword inquiries increase. You’ll, of course, need to get your digital people to add these to your campaigns if you hope to see an increase in conversions.

Wizard of Ads® for Contractors tracks the simplest of indicators. Top line revenue. When your branding takes effect, and the company responds in kind from the phone call or form fill-on, top-line revenue will increase. Efficacy is plotted on a T12, and total lead volume from all sources is tracked.

12 things you should know before signing up.
  1. Quality relationships take time. Branding is a long-term strategy. That’s why most contractors do it wrong, or not at all. There is always a lag between the start of the new campaign and the time it takes your customers to connect the dots. You MUST BE READY, WILLING, AND ABLE to endure this lag period. In our experience, the lag is typically 6 to 9 months, depending on how competitive the marketplace is, your company’s reputation, your budget in relation to reach, and the eight uncontrollable environmental factors. During this time, we will be helping you implement a transition plan to ease the pain. The good news is that this lag only happens once.
  2. Decisions by Committee. We completely reject the notion of decisions by committee. We work with a single, courageous decision-maker. We welcome decision influencers, but we only look to the Owner for the final decision. All decision-makers and influencers must be involved in the Uncovery and Marketing Strategy Presentation if they want to offer input in the future. It is critical that we have a 100% fully approved plan that can be defended and championed by all leaders in the organization.  
  3. Proven Strategy. That means we are not the low-cost provider. With nearly 200 home service clients and a book of strategic devices, tools, and tactics, this isn’t a guessing game for us. We know what to do to make your externally triggered grudge purchase appealing to your potential buyers. If you can deliver the goods, we can continue building relationships. If you are uncomfortable with the idea that you are paying us less now so that you can pay us considerably more once revenues allow, please do not commit. We intend to be your true partners, in sickness and in long as you own your business.
  4. Automatic Payments. Everything is on automatic payments. If you struggle with managing cash flow, figure that out in your business first. We accept all major credit cards and ACH payments.
  5. We Cause Problems. If you don’t have a capacity issue now, I promise you will in about 9 months. Let’s deal with recruitment out of the gate as part of your comprehensive marketing strategy.
  6. We Own the Copyrights. All writing and/or marketing materials we create for you are not works-for-hire. We irrevocably grant you, and your successors in interest, the non-exclusive, royalty-free, non-transferable, and worldwide right to use the Works in connection with the marketing of your business pursuant to the Marketing Strategy for so long as your business is operational.
  7. Brand Building. We will be steering you to limit the use of discounts, rebates, coupons, and sales to attract clients. We know this feels counterintuitive to many, and we will clarify our reasoning. Rest assured, we have considerable experience in creating similar offers that are not damaging to your profitability, your brand’s integrity, and your preferable long-term client relations.
  8. Creative Authority. We must have creative authority over the words. You can accept copy as written or reject it outright, but you cannot modify the words yourself. If you do not like something as written, we are happy to discuss it and make the necessary change to maintain the integrity and intention of the words chosen. Alternatively, we will scrap the concept and create new copy that you are happy to get behind 100%.
  9. Proprietary Algorithm. The media buy must be structured in a very specific way, including running a full 52-week schedule. It is based on brain chemistry, not P&Ls. Once we have committed to the buy, it’s important to avoid adjustments unless they are calculated additions.
  10. Knucklehead Factor. You should expect knuckleheads. For example, when you start running ads that are certain to get attention, you need the courage to continue running those ads, even when you receive complaints. We celebrate complaints. It means we’ve made people feel.
  11. Digital Weasels. In about three months from the time your advertising campaign hits the airways, your digital marketers will show you a marked increase in direct and organic traffic. Some Digital Marketers will mistakenly claim this success as their own. Done properly, you can continue to spend less and less on digital lead generation by increasing your branded keyword online presence.
  12. Annual Marketing Meetings. Travel permitting, we prefer to hold Annual Marketing Meetings (AMMs) outside your city. Years of experience have taught us that we get better results when decision-makers are outside their sphere of influence, away from the day-to-day distractions of the office.

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