Episode 5 The Bottom Line

And now The Bottom Line with Evan Davis.

You have some new clothes, new furniture, the basics of life sorted

out. What you spend your cash on our? Possibly, a new you. Whether

you want to be happier, richer, thinner, plenty of help is

available. DVDs, books or even surgery. The market economy has made

a consumer business art of self-improvement. Some say that

these businesses exploit that sense of inadequacy. We will speak to

three providers in that sector. Each week influential business leaders

gather in London for the BBC Radio 4 programme The Bottom Line.

Let us start as we take a few minutes to meet each of my three

guests. First John Ryan, founder and Chairman of

Make Yourself Amazing. Toll is a bit about your business. I sold my

earlier business and had to stay out of the industry for four years and

then I decided to come back to start with a good friend of mine Make

Yourself Amazing. Tell me what the three most popular surgeries are?

The most popular is breast augmentation closely followed by my

perception. That is the removal of that using ultrasound which

liquefies the fat and then it is sucked out. It is very interesting

to watch because you see these big contenders filling up with yellow

substance. Patients love it because it has just come from their stomach

or backside or were ever they needed it's taken from. It is not designed

for very fat people. It is designed with people with a BMI less than 30.

Is there anything you cannot do? One of the things that people ask --

what do people ask you to do that you refuse? Lots of people ask us if

they can lengthen their appendages. Male organs. We would not go near

that because it cannot be done. I have been in the business for 35

years also and I have never seen it successfully done. City next to him

Carole Tonkinson a publisher with Harper NonFiction. What is the most

popular type of you published? It is men are from Mars women are from

Venus. How many has its salt? 50 million copies. Tell us about the

scale and breadth of this sector. There have been a riot range. -- a

wider range. The first book was Samuel Smiles, and educational

reform who published a book in 1859 called Self Help. This goes back

further than people realise. It goes back to the Stoics and Marcus are

really is. You have said that psychology books are quite big and

important. I think of it as being about dieting, is that not correct?

Diets are only half as big as popular psychology. In the UK it is

about $50 million per year. Books are fundamentally about

transformation on the inside. The psychology books, we have books in

the bestseller lists. Do people read the books that they buy? We do not

do a lot of marketing in book publishing. We are a low margin

business and it is all word-of-mouth. You do not bother

telling people about the book unless you have read it and it has an

impact on you. That is how it works. The entire market in the UK for this

category of book is $50 million. Pounds. That does not sound very

much. It is about 10% of the book market but self-help is a worldwide

category is the biggest. The UK, I am sure you know, is very resistant

to self-help and self-improvement. Very cynical at first. Less so now

in America where these routes have flourished. Jon Congdon President

and Co-Founder Beachbody.com. That name is probably less familiar than

some others. You have used your own product, right? Yes I have used main

products. Is a fantastically marketed workout programmes. We

primarily launch our brands on television. We have a variety of

programmes. Insanity is quite extreme. We convince people to go

out and kick your own but is how you do it. They are inspirational but

some people do not want to stop the place we have easier versions. You

have a few time-limited programmes. 60 days, 90 days. Over that time you

hopefully transform yourself. If we can give people bite sized goals

they will do something. If we say workout rehired in perpetuity, it

not very attractive. How big is a business? $700 million in revenue

annually. That is unbelievable. It has been quite amazing. There is a

real appetite for figuring out how to run your life, eating right,

exercising. Mostly it is people that want to lose weight quickly. That is

why we have these timebased programmes. We have ever been in the

UK for three years. That we ask all of you - do your products work? Here

is a good metric prejudging that. What proportion of customers say

that they are glad they bought that product? I do not know whether you

do that research. You are quite close your customers, John Ryan. I

speak to a lot of them. What do they say? The most popular, highly

satisfied group are breast reductions. People who have a breast

reduction are almost 100% happy. Breast augmentation is, very high.

Like a suction, very high. Nose jobs are very difficult. When you have a

nose job it changes your face. It is very difficult for the surgeon to

visualise exactly what the patient wants and then to achieve it in

surgery. The one with the most revisions is rhinoplasty. What

proportion are we talking about? Downright failures because they

would have to come back for a correction. Carroll, what about your

books? We do some but Amazon have the instant reviews. The ability to

share, we can see that people are sharing or liking it on Facebook.

John, you don't get to meet your customers so much? We have a direct

relationships so we are 121. With follow-up very accurately. You know

whether they come out looking like on the video? We openly admit that

our number-1 goal is to get more people to use them. We can market to

somebody, we can inspire somebody, we can send that programme to them.

But when it arrives, all of their intentions were pure, but it is this

box of work sitting inside their living room. Then they have to crack

it open and start. Everything we do is designed to get them to use the

programme. What percentage to not even open at? I think it is more

than you would think between five and 10% cannot bring themselves to

go there. How many get to the end of the 60 days? We did a survey of

consumers and this is consumers who answered, so it may not be purely

scientific. We found that about 30% of those who answered say that they

got to the end of the programme what were pointed the programme that they

considered complete for them. It is not mean that they did every single

day, but it is pretty good. I used to think it was much lower than

that. We are better than most because we concentrate on it but it

is a problem because you have to do it. Just like they buy the book and

intends to improve their life in they read the opening and it seems

to make sense and they put it down and it takes work and it is scary.

Are your products scientifically respectable? To what extent have

what one might call serious people, academics who have done controlled

experiments, valued your products? Cosmetic surgery, the books, or the

workouts. Some, yes. Mindfulness is a big trend now, on the cover of

Time magazine, there have been many scientific studies to show that it

lowers cortisol, your stress levels. CBT, a lot of GPs are prescribing

books because those techniques work. There is a certain proportion where

the users grow. What about the videos, the DVD is? This sector is

very highly watched, people are looking at what you are saying. We

stand by our products 100%. There is a big disclaimer at every DVD

because not everybody should be jumping into it right away. John

Ryan, your staff are qualified surgeons presumably? They are all

specialists. My job is to make sure that get the right surgeons in my

business. Cosmetic surgery is very highly regulated from when I

started. We have the Quality Care Commission. Reports: the Internet

and people can see them. We have our own forum so people can talk to

people who have had treatments. We have had an interesting discussion

about the degree to which these products work and some work and

others don't. Is there something about the whole industry, the dark

side of it, it plays to people 's fears and insecurities and the wrong

sense of inadequacy? This is about motivation. Our products give people

either confidence or motivation for the ones who want it. When you have

that in a motivation, all of these things will work. If you do not have

the motivation then it will not work. It is the difference between a

positive person who will get the most out of everything while a

negative person, and a matter how good the operational book or

programme, will not get the most out of it because they either will not

open it will think it is not me. there is a dark side to self-help.

There was a great book where the author was made to feel guilty when

she got breast cancer because she wasn't thinking thoughts that were

positive enough. Out was why she was sick. Some people take the idea of

creating around reality to an extreme. That is important to

acknowledge. The books that we publish an suggesting that. It is

our job to be aspirational because people get stuck in a rut. You never

feel, Jon Congdon, that it plays to people's appeal of inadequacy?

People think that they are good-looking? The industry runs the

risk. People purchase our products out of vanity. They then get healthy

and realise that the end result was the better living result. We must

talk about weight loss and inches lost because the average consumer is

into thinking that they have to get healthy, they think about their

looks. There is that element in the commercial. Absolutely. To a defence

of the sector is that a byproduct of selling something to your hope is

that even if we don't satisfy that hope, you come out of it better than

you would have been otherwise. Remak hope is about living a better life

and that is the hope which can be delivered. They want to look like

the guy in the video who is bigger and better and better looking. They

might. They might want to be somewhere between where they are

back guy and figured that that is good enough. With books, you have

that outward ideal in the same way. It is more individual our solution.

I feel that that is not such an issue without -- with us. There are

books saying get rich quick or lose fat quick. They promise much more

than they could possibly deliver. We have the body book I Cameron Diaz,

about loving your amazing body. The premise is not that your body needs

to become better, the premise is that you already are. It is about

appreciating your health and what you can do. A lot of the best

selling books that we sell are about making girls confident, not about

changing something about them. It is about making them appreciate what

they have. The customers, the really important question is whether they

have the right frame of mind for the products which you sell. You

wouldn't want to do cosmic surgery on someone who was body dysmorphic

and didn't have anything wrong with them, would you? Would you turn them

away if they came to you? We turn a lot of people away. Because they had

a BMI that is too high and our obese and they want to be made into a size

ten. It is unrealistic. We turn away Peter Kirk -- people with a picture

of a film star and say that they want to look like them. Some people

have a problem. They have had it for years and want to fix it. Somebody

has a big nose or sticking out years or a flat chest and it bothers

them, why shouldn't they get it fixed? What age are the people who

purchase your services, cosmetics are too has a special issues about

age, what is the youngest you go on? No one under 18. I always say

that boobs are the 20s, wiper is in the 30s, facial work 40s and the lot

in the 50s. LAUGHTER. A summary of the life cycle. For us, the average

is 41. It is interesting. If you break down the categories, parenting

is 25 -40, business tends to be more male, a bit younger. Late 20s, 30s.

Popular psychology is about 41 with an average age. We run the gamut. It

is well spread. The largest groups are in the 30s rather than 20s and

40s. We had 50s, 60s, 70s, people want to lose weight. Are a positive

people less likely to use your products? If I'm a positive person,

I don't feel like I need as much cosmetics change or I am happy with

myself. Every 18 months, someone buys a book. They may identify

themselves as a self improver. It's a hobby. There are more damaging and

dangerous hobbies. It is how some people want to live. A hobby or an

addiction? The products are under a tenner. They are free at the

library. We aren't exploiting dependency situations. Addiction is

too strong a word. I mean a kind of... Hooked on the way to make

themselves better. We all run the risk that someone can become

obsessed. Let's talk about the marketing and advertising. Jon

Congdon, you have this interesting distribution body which I would like

you to explain in more detail. You basically use that users of the

product as agents who then sell and promote. It is a US -based business.

We have them in Canada as well. We aren't in the UK yet. What they can

do on the ground is obviously far more intimate and personal then we

can do by sending an e-mail saying that you should be an day 30, how is

it going? It can sound a little bit like Big Brother or parental. They

are trained? Know and they are designed to be. We have customer

support and frequently asked questions so that we can answer

questions or direct and if asked questions so that we can answer

questions or directed to fitness advisers. We will talk about other

marketing in a moment but back to Carol's point that quite a lot of

the marketing is through personal content. It goes from to E Tootsie.

That makes it less likely that you will go... -- A to B to C. They are

incentivised. Publishing has no such budgets. We wish that we could

incentivise our bob -- power readers. It is social communities

all feature coverage, magazines... How do you market cosmetics surgery?

We would love to market it through the forum. Also through

recommendations. We also is used the Internet a lot. The television for

branding but we use the Internet, mainly. Celeb Richie endorsement? We

have a television programme, the only way is Essex and I think that

she became -- you became involved with some of the popular television

programmes? -- you you use celebrity endorsement? Ella Mackle used to use

it but less so now. British Association wasn't happy with the

way that was presented. They thought that we were trivialising. We

weren't. We now use normal people. They were worried about younger

girls being particularly influenced by their heroes. I want to get the

hang of the business model. It will be different for you in the cosmetic

surgery field because it is so personal but the other two of view,

the upfront costs are low and it is about distribution, isn't it? Once

you've made one DVD, you are better off selling 1 million then... It

costs less to sell 1 million? The economics... We hope that economics

and marketing will have mass appeal so people will buy it. Jon Congdon,

you have a few products. We have 25 different fitness programmes. There

are only three or five that are on television at a given time. We

purchase a lot of media for them. You have a longer tail. We do. Huge

numbers of books. Thousands. 65 first formats a year now. More than

one week. That includes cookery and sport and the same bolt's

autobiography and not just self-help. -- Usain Bolt.

Is it profitable? It is very labour intensive. It isn't like selling

DVDs or books. Every patient has a lot of consultations and medical

questionnaires, medical tests. It is a business which makes muggy but we

aren't the get rich quick business. For us, the e-book revolution is

perfect for self-help because a lot of people are still ashamed to

purchase a book if they have a particular challenge. They are able

to do that now from their device or tablet. Decent margins but not

fantastic. Your business must be enormously profitable. $700 million

per year? How do you make a profit? Percentage of revenue? Not amazing.

We spend a lot of time investing in technology. At the end of the day it

is in some crazy 30% or 40% profit numbers, unfortunately. At this

point, an end to the proceedings. Let me thank my guests. John Ryan.

Jon Congdon. And Carole Tonkinson. My thanks to you and my thanks to

you for listening. I will be back next week. They forget that

downloads are available. Details are on the website and you can listen to

it on BBC Radio 4. We also like to get your e-mails. Drop us a line.

Meteorologists refer to the start of March is the start of spring. The

weather takes no notice of me to religious and that is why we are

going to a chilly start. Patchy frost