The Game with Alex Hormozi - Eyes Forward - Looking ahead | Ep 189

Episode Date: March 19, 2020

"Your competitors don't steal clients from you. No one steals clients, you lose clients." Alex (@AlexHormozi) discusses the importance of shifting one's mindset from viewing competitors as stealing clients to embracing abundance and helping others in the industry. He emphasizes the benefits of building relationships and how it ultimately benefits everyone in the community.Welcome to The Game w/Alex Hormozi, hosted by entrepreneur, founder, investor, author, public speaker, and content creator Alex Hormozi. On this podcast you’ll hear how to get more customers, make more profit per customer, how to keep them longer, and the many failures and lessons Alex has learned on his path from $100M to $1B in net worth.Timestamps:(0:35) - Actively testing ads for remote gyms, 3 things being tested.(2:12) - Promise of no sunshine or rainbows, prepare for intensity.(5:32) - Stop the bleeding, transition clients to remote workouts.(7:46) - Business decisions, keep valuable assets, cut costs, provide value.(11:34) - Fill the bucket, run ads, impressions cheaper than ever.Follow Alex Hormozi’s Socials:LinkedIn | Instagram | Facebook | YouTube | Twitter | Acquisition

A lot of what has been created for the community is good. I think it's all great stuff, but we need to solve the fucking problem. Welcome to the Jim Secrets podcast where you talk about how to get more customers, how to make more per customer, and how to keep them longer. And the many failures and lessons that we have learned along the way. I hope you enjoy and subscribe. Hey, what's going, everyone? Hope you guys are having, well, I would say a great Monday, but I'm sure right now you're in the middle of the thick of it. And so I wanted to give you guys a couple updates of what's going on our side and then also give you a couple of frameworks.

to kind of think through what's going on right now with. So first off, on the gym launch side, we are actively testing the ads in for remote gyms. We'd already, you may or may not remember, we had our hyper program that we launched eight months ago to the great, what do you call it, lashback of the entire gym community saying that I was trying to kill gyms, and in fact it is probably the thing

that they wish they had started eight months ago. And I say that only to say sometimes having open mind is a good idea. That being said, we're testing ads in 35 markets as of right now. I want to give them 72 hours to run. There's three main points of success that we're looking for, which is one, that the lead flow is what we expected to be, which is the same as the 21 day play right now that's killing it, or was killing it into Corona. Two, that the Allen system that we have set up for booking remote calls works as,

as intended and as desired. My gut is that it's actually going to work a little bit better since we don't actually have to get someone in the car show up for their appointment. And then the third is that the offer that we've structured on the phone converts at the percentage that we said it was going to. And so those are the three things that we're testing. We have 35 markets that we're running it in.

And I'll let you guys know in real time when we have the results from that and then that will be what we're released because my intention was not to create a checklist or widget or PDF. And I think that a lot of what has been created for for the community is good. I think it's all great stuff, but we need to solve the fucking problem. And so that's kind of what I wanna talk about

for the second small piece of this, which is kind of looking ahead. So I wanna make a promise to you, which is that what you're going to go through over the next few months is going to be some of the hardest that you're going to go through. I'm promising you no sunshine, no rainbows, it's going to be intense, and you're going to have to work.

And I know that some of you were in a headspace going into this that was like, I was already fucking burned out. I was already tired. And it was before all this shit happened, right? And so you're going to have to dig deep and find a gear inside of you of how bad you want to do this. Because right now, looking ahead, there's probably a voice in your head that's telling you,

if we fail right now, like no one's gonna blame us. Like my wife's not gonna think of a failure. My parents, they'll be like, well, you know, coronavirus, right? And the thing is, is that they would be 100% reasonable in saying that because it wouldn't be your fault, right? it would be incredibly reasonable for a gym to go under during this transition time. Right. What I'm asking to do is not be reasonable, but be unreasonable, all right, and want more.

And there's going, like, everything that affects gyms affects gym lunch. All right. So like, I'm going through this shoulder to shoulder with you trying to figure this out. You've got payroll. I've got 600,000 I'm worth in payroll. All right. So the feelings you have, just multiply them. All right.

I get where you're coming from. But I can tell you that winners will always win. Whenever there's panic, there's always opportunity. Panic is simply an embodiment of intense pain. Whenever there's pain, it means there's something that can be solved. And that means right now, here's the silver lining. There are going to be more people on their phones, hold up at home, health conscious, worried about their health, eating cookies, all these, feeling fat, right? Who are, like I said, on their phones, and the impressions on Facebook are already 50% off.

If anybody who's still marketing right now knows, leek costs of actually. dropped. And that's because a lot of people have stopped their advertising. And so it is going to be just like whatever happens at every kind of V bottom in every market is there's going to be a winner take all. There's going to be consolidation. The guys who don't have the willpower or gals to weather this will give up all of their members to other gyms. And the gyms who make it through will be bigger, stronger, and more profitable than ever. And that's a promise. That will happen. Buying behavior is going to shift because as every single gym now has had circumstances break their belief about whether remote training was possible in a brick and mortar facility in a local market,

all right, it is going to be possible and that belief is being made for you. That choice has now been made. You had the choice eight months ago to make that choice for yourself. Now it's being made for you. And so with that choice, now consumers are going to be used to giving their card over the phone and having remote services. And so because of this, like I said, silver lining, a lot of people are going to get used to remote training. It's going to become more mainstream. I think this may have actually moved up the remote training kind of movement, maybe 18, 24 months from what it was going to be. I think there's going to be a lot of gyms who come out on the other side of this with a booming remote business because like I said,

demand for this is going to be huge. Your skill set has never been more valuable and yet undervalued. And so my goal is to flip the script in this period of time and let gyms capitalize on that. Right. And so the play is going to be simple. We're going to, one, stop the bleeding. You need to transition all of your existing clients into remote. You may think, well, we're not quarantined yet.

It's a matter of time. You have to look at this. Everybody's watching the same movie. It just matters what chapter you are in. All right. So look at the people who are covered chapters of head and just read forward. Don't think, well, we're not there yet because honestly, I think it's going to get there. Right. And so whether you are quarantined by mandatory or people have already started the social distancing, you've already probably seen this. And so just start preparing ahead. All right. Now, what is the offer that you're going to do to stop the bleeding? You're going to have to offer one-on-one services for remote training so that you can keep the value of not coming to the gym. And so if you're used to charging $150 a month or $200 a month for in-person training, you have to over-deliver on value to your clients because they're no

we're getting what they signed up for. And so you have to give more of the thing that they didn't sign up for in order to keep them. And so it's not, I was working out and now I'm not working out. You have to frame it as you used to be in a group setting and now you're one-on-one. All right. And that's the value here, is that you're going to shift them from a 101 in-person setting, sorry, a group setting that's not, that's in-person, a group setting in person, to a one-on-one remote setting.

And by doing that, you'll be able to maintain the value discrepancy of a $200 a month membership. Now if right now you're like, oh shit, Alex, I don't have that. I'm not ready for that. This is where I said this is going to take work. You're probably going to work more in the next, I don't know how many months. I wish I could tell you, right? For whatever this, how long this takes, right, you're going to work more during this period of time than you probably ever have. The good news is that you're not going to be at your gym, so you're going to be working from home. And so for anyone who's ever had to do with this, if you don't have all these sessions to take It actually does calm the noise a little bit.

And so the majority of your day is going to be doing sales calls. All right. Your trainers need to fill on those remote services so that they can continue to get paid. There are going to be people who get laid off, period. As much as I'd love to say that like you need to keep everyone, you need to make business decisions. You need to look at who are your most valuable assets. Who is willing to work more? Who's willing to buckle down?

Who is not emotional? Who can be calm and who can continue to provide value while things get a little bit crazy. Okay. Now, my hope is that everything blows over and none of this matters, but I don't think that's going to happen on a short enough time frame, and so we just need to prepare. Hey, Mosin, A minute, quick break just to let you know that we've been starting to post on LinkedIn and want to connect with you. All right, so send me a connection request and note letting me know that you listen to the show,

and I will accept it. There's anyone you think that we should be connected with, tag them in one of my or layless posts, and I will give you all the love in the world. All right, so let's get back to the show. All right, so number one, you stop the bleeding. Number two, you have to focus on how you can. can cut overhead. All right, now you have a facility.

There are a couple things that you can do. The primary one is that you can email your landlord and ask for rent relief, okay? And so what that means is that you should be able to get two to six months of free rent for your landlord. There are a couple ways to structure those deals that I'm going to tell you these right now so that you can tactically do something, all right? The training that we're going to come out with later this week is going to have all these and email templates and all that stuff.

But for right now, I just, like, I'm just going to give you the overlay. One, you can just ask for the free run up front. All right. And the reason that you have leverage there is because most, most leases have clauses that are act of God or force majeure clauses, which means force majeure, if you're saying it differently, right? Clause means if there's something crazy that happens, you can get out of a lease.

Now, coronavirus is something that would cause injunctive relief to your, you know, huge damage to your business and you can make a very easy argument that that's what it would be. Now, a landlord is probably not going to be able to find another tenant for the next four to six months. and they would like to keep you. And so you have to understand where you have leverage. They're not going to find someone else. And so giving you three months, four months of free rent so that they can keep you as a tenant is something that a lot of them will be willing to do, number one.

Number two, how do you structure that? One is they can just give it to you and they can subtract it from the lease. Number two is they can literally just push the lease forward. So you basically add another three to six months to your lease at the end where you're going to be paying for that. So your total lease value stays the same. You're just pushing out some free months during this gap. period, all right? That's one way of structure in the deal. The other way of structure in the deal, I mean there's many. Another way is taking that amount and

depending on how much time you have left in your lease, if you have like three or four years left, you can take that time and amortize it, which just means spreading it across the rest of the duration. So if you want to take like, let's say, let's say your rent was $2,000 a month and you're getting three months free, that'd be $6,000. You take $6,000 and you divide it over 48 months if you got like four years left. All right. And so it would be a significant amount cheaper. It might be a couple hundred bucks a month more after this is through. All right. So that's that's what amortizing it over the lease looks like. And the other thing you can do is combine it. Right. Be like, listen, I need I need six months. All right. I'll tack three months on the end and give me three months amortized.

Right. And so you can combine these things so that you can get more free rent. Okay. Because you need that right now because you're not using the facility and you're not allowed to. Right. And you can make that argument to any landlord. And if they're, they're in any way reasonable, they're gonna work with you, all right? So step one, stop the bleeding, transition people to remote training as fast as humanly possible. Create the training system that you have.

Now we already have that in hybrid, we already released that in remote for our guys, and later this week, we're gonna release it to everyone else so that we can help the industry out, all right? The second thing is that you can cut your overhead, which with the least thing that I just said. You can also look at SBA relief loans.

It's gonna be like three and a half percent of people are gonna get it, that's still one in 33, you should still take the shot. It's 50 billion they're gonna be putting in, pumping into the economy, and most people qualify for like five grand to 2.5 million, so you can go for apply for that. The third piece, which is the exciting piece,

is you need to fill the bucket back up, all right? So that's where you're gonna run advertisements. Yes, you're gonna run advertisements. Why? Because impressions are cheaper than ever right now, and people are all on their phones. So that means that there's more attention, there's more ad space than ever before, and it's cheaper than ever before.

So the people who capital, on this are going to make a lot of money. All right? So you have to remember that. So with every panic, there's always opportunity. So I don't want you to lose your minds over this. You're going to lose some cancellations. Prepare yourself emotionally. It's going to happen.

All right. But you're going to have a way to get it back. All right. You're going to have a way to get it back. And that's everything that we're focused on it. Jim Launch is like I said, we need a complete solution. I can't just give you a partial solution and say, transition everyone, pray to God and hope for the best.

It's not going to work, right? And that's all we're doing at gym launch. Since the first announcement last week for seven days, our entire development team is working around the clock, like truly around the clock. They're taking shifts to get Allen so that it could generate remote appointments for people so that you can spend less time doing anything but selling and fulfilling. Right. So if your team can do the fulfillment, you can do the selling and then the marketing can do the marketing.

And that way you can still continue to cash flow your business. All right, and hopefully you might end up on the other side of this thing with a very large remote business and then you'll have decisions to make about what you want to do. Because if you have 20,000, 30,000 in recurring remote customers, you might just want to stay out. Something to consider. All right, but this is going to fundamentally shift the way consumers buy. It's going to bring online training and remote training far more to the forefront,

giving cards over the phone and getting remote training for a few hundred dollars a month. This is going to be far more commonplace, and a lot of people may end up liking it. They might like the one I want attention. That's why it is an industry already. All right, so all that to say, keep your heads about you. And the one thing I can leave you with from a mindset standpoint is, you're going to tell a story about what you do right now. The next few months are going to be telling,

and they're going to tell the story of who you are and who you choose to be. And so I would think deeply about who that person that you want to be is, Because this is where, like, this is where diamonds get made. And these are the moments that you will be able to look back on and be like, I made it through that shit. I can fucking handle this. Right.

And like, you will have every rational reason to give up. The reason the Navy SEALs training is so hard is not because one day if it's hard. It's because they have to do it every single day and it's voluntary. You can leave it anytime. And that's how business is. And right now it's about to get hard. And the people who don't have the willpower are. not going to make it just telling you but the people who do will have a story

that they will be able to tell themselves that will create the identity of the person they want to be and reinforce that because that story of who you really are will stick with you far beyond this moment all right so this is an opportunity for you to prove to yourself about who you are all right it's gonna be a lot of work it always is but there's gonna be a lot of opportunity for the people who keep their eyes open okay so keep your eyes open, do as, like, work as hard as you can to keep the people you got. We're working as hard as we can on the back end to get this acquisition system so that you can fill your gym up

right through remote training, which, by the way, is a much higher profit model to begin with. Because if you had 200 customers at $200 a month in remote training and you don't have sessions you have to pay for and you don't have rent, that's a better model, which was the whole argument for hybrid eight months ago, but it's okay. Now everyone's ready. So anyways, I just will say, I love you all. We're going to do everything in our power, like truly everything in our power. I believe that we're going to do it. And we're going to accomplish the objective because we have the skill set. We have the resources and we have the motivation. And so there's no reason for me to think in any way that we can't do it. So we will.

We already have, I would say if we're going to give an estimate, we're probably about 80% of the way there. We're just putting the finishing touches on. And we should have it live later this week. So anyways, guys, love you all. Hang in there. You can fucking do this. All right, I'll see you guys in their side.