this graph explains why you can’t make money with AI

Liam Ottley
25 Apr 202437:00

TLDRThe video script discusses the challenges of monetizing AI and presents a graph illustrating the technology adoption lifecycle, which is crucial for developing a successful AI business strategy. The speaker identifies different segments of the population in the lifecycle, including innovators, early adopters, early majority, late majority, and laggards, emphasizing the importance of understanding these groups to apply the correct marketing strategies. The script also highlights the 'chasm' between early adopters and the early majority, which many companies struggle to cross. The speaker shares personal experience of making over a million dollars in the AI space and stresses the need to use inbound lead generation methods, particularly content creation on platforms like LinkedIn, Twitter, and YouTube, to attract early adopters and build a reputation before approaching the early majority. The update on OpenAI's Assistant API V2 is mentioned as a significant development that will likely accelerate AI adoption among the early majority due to its improved speed, reliability, and cost-effectiveness.

Takeaways

  • 📈 **Understanding the Technology Adoption Life Cycle**: Recognizing the stages of technology adoption is crucial for successful AI marketing strategies.
  • 🚀 **Innovators and Early Adopters**: These groups are more interested in the potential of AI technology rather than its current use cases or efficiency.
  • 🤝 **Building Trust with the Early Majority**: To sell to the early majority, businesses need to provide proof and evidence of AI's effectiveness, as they are more pragmatic and risk-averse.
  • 🛠️ **Market Dynamics**: Knowing the market dynamics is key to using the right tools and strategies for AI technology sales.
  • 💡 **Inbound Lead Generation**: Attracting early adopters and innovators through content creation and social media engagement is an effective strategy for AI agencies.
  • 📊 **The Chasm**: Crossing the chasm from early adopters to the early majority is a significant challenge for technology companies, including those in the AI space.
  • 📈 **Market Expansion**: As AI technology matures and improves, the market will expand, offering opportunities to reach the early majority and late majority segments.
  • 🎯 **Personal Brand and Content Strategy**: Building a personal brand and sharing expertise through content can attract the right audience and potential clients.
  • ⏰ **Urgency to Act**: There is an urgency to establish a presence and start acquiring clients in the AI space before the market becomes saturated.
  • 📘 **Case Studies and Testimonials**: Having case studies and testimonials from successful projects is essential to convince the early majority to adopt AI solutions.
  • 🔗 **Open AI's Assistant API V2**: The release of the updated Assistant API V2 signifies a maturation of AI technology, making it more accessible and cost-effective for a broader market.

Q & A

  • What is the main challenge people face when trying to make money with AI?

    -The main challenge is not understanding the technology adoption life cycle and applying the wrong strategies to acquire customers.

  • What are the different stages of the technology adoption life cycle?

    -The stages are Innovators, Early Adopters, Early Majority, Late Majority, and Laggards.

  • What is the 'chasm' in the technology adoption life cycle?

    -The 'chasm' is the gap between Early Adopters and the Early Majority that many companies struggle to bridge to reach a larger customer base.

  • Why is it difficult to sell AI solutions to the early majority?

    -The early majority are more pragmatic and require proof and evidence before adopting new technology, which can be challenging if you don't have existing case studies or testimonials.

  • What is the recommended strategy for AI agency owners who are just starting out?

    -The recommended strategy is to focus on inbound lead generation by creating content that appeals to early adopters and innovators, thus attracting them to the business.

  • How can AI agency owners overcome the challenge of selling to early majority without proof?

    -By first targeting early adopters and innovators to build a portfolio of work and testimonials that can then be used to sell to the early majority.

  • What is the significance of the Assistant API V2 release from OpenAI?

    -The Assistant API V2 is a significant update that makes AI solutions faster, cheaper, and more reliable, which can facilitate the adoption of AI by the early majority.

  • Why is it important for AI agencies to build a personal brand and engage with people on platforms like LinkedIn?

    -Building a personal brand and engaging on platforms like LinkedIn helps attract early adopters and innovators, which can lead to testimonials and case studies that are crucial for selling to the early majority.

  • What is the current state of competition in the AI agency space?

    -The competition in the AI agency space is currently low because there are few agencies that understand the technology adoption life cycle and are effectively positioning themselves to serve the early majority.

  • Why should AI agencies act quickly to establish themselves?

    -AI agencies should act quickly to establish themselves before the market becomes saturated with competitors and before potential clients become fatigued by a flood of agencies offering similar services.

  • What is the role of content creation in attracting early adopters and innovators?

    -Content creation is key to showcasing expertise and building trust with early adopters and innovators. By sharing knowledge and insights, AI agencies can attract the right audience and establish themselves as thought leaders in the space.

  • How can AI agencies leverage the improvements in AI technology to their advantage?

    -AI agencies can leverage the improvements in AI technology by offering more reliable, cost-effective solutions to clients. As the technology matures and becomes more accessible, agencies can position themselves as providers of cutting-edge solutions that meet the needs of the early majority.

Outlines

00:00

📈 Understanding the AI Market: The Technology Adoption Lifecycle

The speaker introduces the concept of the technology adoption lifecycle, emphasizing its importance in formulating strategies for success in the AI space. They discuss the various stages of technology adoption, including innovators, early adopters, early majority, late majority, and laggards. The chasm, a critical gap between early adopters and the early majority, is highlighted as a common challenge for technology companies. The goal is to understand these segments to apply the correct marketing strategies and leverage market dynamics effectively.

05:02

🚀 Selling AI Solutions: Targeting the Right Audience with the Right Message

The focus shifts to the practical aspect of selling AI solutions, particularly targeting the early adopters and innovators who are more open to new technologies without extensive proof. The challenges of marketing to the early majority, who require more evidence and are less risk-taking, are discussed. The speaker shares their personal success in selling AI and emphasizes the importance of understanding the technology adoption cycle for creating effective business strategies.

10:04

📊 Overcoming the 84% Handicap: Inbound Marketing for AI Services

The speaker illustrates the difficulty of cold emailing and reaching out to potential clients when you lack proof of your AI solutions' effectiveness. They propose inbound marketing as a solution, attracting early adopters through content that appeals to them. The speaker's own success with inbound lead generation, particularly via YouTube, is shared as a case study. They also mention the effectiveness of LinkedIn and Twitter for generating leads.

15:07

🤝 Building Trust and Expertise: The Power of Consistent Content Creation

The speaker advises on how to generate inbound leads through platforms like LinkedIn by consistently posting valuable content and building a network of connections. They discuss the importance of demonstrating expertise and competency in AI to establish trust with the audience. The race to secure clients and gain testimonials to reach the early majority is also highlighted, urging the audience to act strategically and swiftly.

20:08

🌟 The AI Agency Space: Navigating the Market Dynamics and Competition

The speaker provides a challenge to the audience to understand the market dynamics within the AI agency space. They discuss the current state of the AI market and the importance of attracting the right audience through personal branding and content creation. The speaker also warns about the impending increase in competition and the need to establish a strong position before the market becomes saturated.

25:09

📘 API Updates and Market Shifts: Preparing for the AI Technology Maturity

The speaker discusses the significance of the assistant API V2 release from OpenAI, which represents a maturation of AI technology. They draw parallels with the historical progression of technology adoption, such as the internet, and predict a shift in the market towards the early majority. The urgency to establish a personal brand and start engaging with potential clients is emphasized to capitalize on the upcoming market opportunity.

30:10

💼 Facilitating Adoption and Making Profits: The Strategy for AI Agencies

The speaker outlines the opportunity for AI agencies to facilitate the adoption of new technology among the early majority. They stress the importance of having a growth strategy, learning on the job, and documenting the process to build trust and showcase expertise. The speaker also mentions their motivation for creating educational content, which is to help the audience succeed so they can become clients for their software solutions, creating a win-win situation.

35:11

🤓 The Collective Brain Behind Success: Leveraging Team Expertise

The speaker clarifies that the knowledge and strategies shared do not come solely from themselves but are a collective effort from their business partner, CTO, and the rest of the team. They emphasize that the purpose of creating and sharing these videos is to educate the audience, enabling them to become successful AI agency owners, which in turn benefits the speaker through the use of their software.

Mindmap

Keywords

💡AI

Artificial Intelligence (AI) refers to the simulation of human intelligence in machines that are programmed to think like humans and mimic their actions. In the context of the video, AI is the core technology being discussed for its potential to revolutionize business operations. The speaker emphasizes the importance of understanding AI's role in the technology adoption lifecycle.

💡Technology Adoption Lifecycle

This concept describes the chronological order in which a population adopts an innovation. The video script outlines different stages of this lifecycle, including innovators, early adopters, early majority, late majority, and laggards. Understanding this lifecycle is crucial for strategizing the marketing and sale of AI technologies, as it helps identify the current position of AI in the market and the appropriate target audience.

💡Early Adopters

Early adopters are a group within the technology adoption lifecycle that follows the innovators. They are visionaries who recognize the potential of a new technology and are willing to be the first to implement it in real-world scenarios. In the script, the speaker discusses the importance of targeting early adopters when selling AI solutions, as they are more open to new technologies without extensive proof of their effectiveness.

💡Crossing the Chasm

This term, coined by Geoffrey A. Moore in his book 'Crossing the Chasm,' refers to the difficulty of transitioning from selling to early adopters to selling to the early majority. The chasm is the gap between these two groups, and crossing it is critical for a technology to achieve widespread market acceptance. The speaker uses this concept to explain the challenges of expanding the customer base for AI solutions.

💡Inbound Lead Generation

Inbound lead generation is the process of attracting potential customers to a business through content marketing, social media, search engine optimization, and other means. The speaker suggests this as a more effective strategy than cold emailing for AI agencies, as it allows early adopters to discover and engage with the business on their own terms.

💡Outbound Communications

Outbound communications are proactive marketing efforts that involve reaching out to potential customers, such as through cold emails or direct mail. The video script discusses the limitations of outbound communications, especially when trying to sell to early majority who require more evidence and are less likely to respond positively to unsolicited sales pitches.

💡Personal Brand

A personal brand is the image or identity that an individual builds for themselves, often used to promote their professional services or expertise. The speaker emphasizes the importance of establishing a personal brand to attract early adopters and innovators to an AI agency's services through inbound marketing efforts.

💡Content Marketing

Content marketing involves creating and distributing valuable, relevant, and consistent content to attract and engage a clearly defined audience. In the context of the video, content marketing is presented as a key strategy for inbound lead generation, where the speaker shares his success in using YouTube to attract early adopters to his AI services.

💡API

An Application Programming Interface (API) is a set of protocols, routines, and tools for building software and applications. The speaker discusses the release of the Assistant API V2 from OpenAI, highlighting how improvements in such technologies can facilitate the adoption of AI by making it faster, cheaper, and more reliable, thus appealing to a broader audience.

💡Proof and Evidence

In the context of the video, proof and evidence refer to the tangible results or successful case studies that demonstrate the effectiveness of a technology or solution. The speaker explains that the early majority requires this proof before they will adopt a new technology, which is why it's crucial for AI agencies to build a portfolio of successful implementations to attract this larger segment of the market.

💡Strategic Marketing

Strategic marketing involves the planning and implementation of marketing initiatives that align with a company's overall business goals. The video script discusses the importance of understanding the technology adoption lifecycle and tailoring marketing strategies accordingly to target the right segments of the population at the right time.

Highlights

The graph explains the common reasons why people struggle to make money with AI, emphasizing the importance of understanding the technology adoption life cycle.

AI technology adoption follows a specific life cycle with distinct stages, including innovators, early adopters, early majority, late majority, and laggards.

The 'chasm' between early adopters and the early majority is a critical gap that many companies struggle to bridge.

Understanding the market dynamics is key to applying the right strategies for acquiring customers at different stages of technology adoption.

Innovators and early adopters are more interested in the potential of technology, whereas the early majority requires proof and evidence of its effectiveness.

The speaker has made over a million dollars selling AI, attributing their success to a deep understanding of the technology adoption life cycle.

AI agencies should focus on early adopters initially, as they are more open to new technology without extensive proof.

Cold emailing and outbound communication can be highly ineffective due to the small percentage of the population ready to adopt AI.

Inbound lead generation methods, such as creating valuable content, are more effective for attracting early adopters.

LinkedIn, Twitter, and YouTube are effective platforms for inbound lead generation in the AI space.

Building a personal brand and demonstrating expertise is crucial for attracting clients and proving the value of AI solutions.

The recent update to the Assistant API V2 signifies a maturation of AI technology, making it more accessible and cost-effective for a broader audience.

The technology's advancement is outpacing its adoption, creating an opportunity for AI agencies to facilitate the shift towards broader acceptance.

AI agencies need to move quickly to establish themselves and secure early adopters before the market becomes more competitive.

The speaker emphasizes the urgency of acting now to secure a place in the growing AI market before it becomes saturated with competition.

Creating a successful AI agency is not only about making money but also about being part of the technological shift towards AI adoption in businesses.

The speaker's motive for sharing this knowledge is a win-win situation, where successful agency owners become potential clients for their software solutions.

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