The Game with Alex Hormozi - Selling High-ticket Offers (with Emmanuel Abolo) Pt. 1 - Sept. '21 | Ep 445

Episode Date: October 8, 2022

(Disclaimer: This interview was recorded over a livestream. We apologize in advance for the quality of the audio.)It's more about embracing change and about being flexible in terms of the goals that we set. Today, join Alex (@AlexHormozi) as he guests on Emmanuel Abolo’s YouTube to talk about convincing people to say yes to your high-ticket offers, how the grand slam formula can be applied to any kind of business, and trying to solve every perceived problem of your market. This is part 1 of the interview.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.Check out the episode on Emmanuel Abolo’s YouTube Channel! Timestamps:(1:11) - Niche switching doesn't solve client acquisition; focus is key.(5:17) - Overcoming challenges convincing clients to pay substantial fees.(9:31) - Guaranteeing results in relationship marketing; transferring to other markets.(11:58) - Qualifying avatars for grand slam offers; adaptable strategy.(18:27) - Market efficiency and offer planning to avoid regression.(21:28) - Addressing multiple problems; impact on overall market strategy.Follow Alex Hormozi’s Socials:LinkedIn | Instagram | Facebook | YouTube | Twitter | Acquisition

What's up guys? I made a short podcast. It's two parts. This is part one with Emmanuel Bolo. Crazy story. A guy reached out to me 100 times and said, I promise you, if you will come on my thing and he kept following up again and again, I really didn't want to do it. He's like, if you say yes, he's like, I will get every single human being I know to show up to this podcast. And I was like, all right, man, I'll do it. And motherfucker messaged every human he knew and got like 200 people live. And I don't think that was the size of his audience at the time. And I just always said, I have my respect for that. So I want to tell you guys for listening because hopefully you get as much out of that as I did. But the first half of the podcast is all about making hot ticket offers. I think you guys will dig it. We got pretty tactical with it because he's like real ground grassroots right now.

And so if you're in that position, I think it'll totally apply to you. So enjoy. Welcome to the game where we 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 we have learned along the way. I hope you enjoy and subscribe. And when I went through your book was, you know, one, you know, changing the cheese on, you know, people have to move from one niche to the other because they feel that I'm not able to get clients in this niche and so maybe I should just switch my niche and I'll get clients. And how exactly does that not solve the problem of client acquisition?

So fundamentally, as long as you are not selling newspapers, which is what I give us the example of the book, as long as you're not truly selling ice to Eskimos, as long as you're selling something that people want, which a lot of times is the problem, right? As long as you're selling something people want, And if you're a marketer, for example, and you're trying to sell, you know, getting more leads or making more sales, everyone wants that. Right. So there's really no disconnect there. The issue is usually that you have a lack of skill in some way.

And the problem that that rises is when you start trying to switch avatars or switch niches, you end up having to start over again. Because you have to learn the avatar. You have to learn the desires. You have to learn how to speak to them. You have to learn what their problems are. And the thing that I kind of go with is that all of those will work, but none of them will work if you try to make them all work. So you have to grow through elimination, right? Because I'm a big believer in the theory of constraint will grow to the constraint that we have. And most people, and this is one that maybe everyone in the audience can resonate with, when I see an entrepreneur who's doing a million or five million or 10 million or whatever, and they say, well, I'm going to start this other vertical.

I'm going to start this other thing. What ends up happening is that this one goes up and their main one goes down and they're still doing $10 million, except they have more overhead now. And so you can't be CEO of two companies, right? Think about how many publicly traded CEOs exist that are CEOs of two companies. There's only one person that anyone ever gives and they say Elon Musk, but he's actually not. He's not the operator. He's the owner or founder of those companies and he has people who run them. But the point is that you're probably not Elon Musk if you're still struggling to make your first sales.

So if that's the situation, then let's just cross him off the equation and say that no one is doing CEO of multiple companies. And so the issue is a lot of times with the definitions, right? So it's like, I'm owner. So you hire one person because you're one person, you figure, oh, well, I'm a one person, I'll hire one person, and there we go, and I'll have a passive business. But the reality is that there's so many shades of what we do, because we're really just fractionally doing like eight different jobs, right? So your head of customer service, your VP of sales, your chief marketing office, your CEO, you're also owner, right? And so you're doing all

of these roles, and so you maybe replace the fulfillment, but you still have to be CMO, you have to be still VP of sales, you still have to be the owner, you still have to be, all these other hats. And so if you're trying to imagine doing that for two businesses or three businesses, it becomes a work equation that doesn't work and people can't solve it. And that's why they burn out and give up because they're spread too thin. There's not enough heat for the amount of pans on the stove. And so the formula of, in case anyone's listening, I'm not sure how developed the audience is, but for zero to a million, which is most people are starting out, right, it's just one-one,

It's one product to one avatar on one channel. And if you're like, well, I'll do one product, one avatar, one channel on each of my businesses. No, no, no, one product to one avatar on one channel. And you will fail and you will continue to fail until you succeed. And then at that point, it will begin to work. And most of the time, in my opinion, the reason I started all the series of books with the offer is that getting customers shouldn't be difficult. The difficulty should be in the fulfillment, which means being good at your craft. because what happens a lot of times is people think they need to learn more promotion, more sales.

And that's true to a degree, right? But it's, in my opinion, easier to just make a more compelling offer, do more for your clients, even if you only have a handful of them that is not scalable, and that's okay, because you need to generate cash flow and make sales, learn as much as you can, get better at your craft, and then in time, create a more scalable offer as you learn what they value, what they don't value, what takes you time, what doesn't take you time, and as you ultimately get better, right? And so that's kind of like the Tesla model, too. It's like you start with the most expensive thing at the top.

You start there. And then as you build that and you brand position as being elite there, then you can do a mid-level. And then over time, you can trickle down and do a larger, lower-cost item for the base of the pyramid. Most people do it backwards and do it wrong and try and compete against lots of people

when they're not even that good. And that's the reality, right? Most people don't make money because they're just not that good at the thing they think they're good at. If they were good, then they would be making money. When you said it starts the most expensive thing, I notice when I tell people who charge more, you know, starts with, you know, what they say, I won't get people who pay me that money or, you know, how do I get people to pay me that much, right?

So how do you usually communicate that to overcome that particular mind challenge? So people won't pay you for the value you're currently trying to provide. That's the issue, right, is that they won't pay you for what you're, comma, for what you're trying to provide them, right? But if you try and provide in excess of that, and so as a thought experiment or a thought example, think of this. Let's say we said, if you're selling any kind of B-to-B thing, right, which would be like how to increase how much money you make. Let's just start there because there's a lot of people who are in here probably in that space. If I were to say, I can double how much you're making or if people aren't making money who you're serving, they say, I can add $10,000 months of your income within 90 days, guaranteed, or I'll pay you twice to the cost of the program at the end of the 90 days. how difficult would it be for you to sign people up? Not hard at all. How difficult would it be for you to get someone to pay you $10,000 to make $10,000 a month? Well, considering colleges graduate pay people who were going to make $50,000 after waiting four years and people pay $200,000 for that. I think it's reasonable believe that people would pay between $10,000, $30,000 for that skill. And so then the question is, or what I would normally get after that is like, well, I can't do that, Alex. I don't know how to get someone. I can't guarantee that outcome. And it's like, aha, then let's solve the problem.

which is that you don't know how to do that. Now we have a solvable proposition that we can get better at. Whereas I don't know how to get customers. Sure, that is also a solvable thing. But in my opinion, you would be best served honing the craft and finding a way to fill in such a way that you could guarantee that within a reason. And if that's the thought experiment and on the other extreme you have, buy my thing and maybe you win and maybe you don't and I get paid either way,

that's the essence of what most people's offer is. If we just boiled it down to soups and nuts, right? And so if this is one extreme where everybody says yes and lots of people want to buy from you, and on this extreme, it's very difficult to get customers, there is somewhere on this continuum, ideally one or two shades from this side, right, from the more compelling side, that you can sell and can offer and can fulfill on in a way that will get people better results. So the example that I give for a lot of agencies, because a lot of people who are starting out and internet with Facebook ads, it's a basic skill, and then they try and sell those services.

If I were starting over again, I would not try and do that. What I would do is I would go find the avatar that I like locally and say, okay, Mr. Drycleaner, Mr. Chiropractor, or Mr. Whatever, I will run your ads for free and I would like to own the entire process. And so, hey, you just cover the advertising. I'll work your leads. I'll work your front desk. I'll sell the people.

And what you could even do is just negotiate a bulk rate. Hey, if I got you a thousand customers tomorrow, what's the lowest you could possibly do it for? maybe he says $200 for whatever the widget is, right? And you say, cool. And then you go ahead and sell for $800. And you make $600 on every one of these deals, and you pay him as $200 to go fulfill and the rest of its margin, right? The beauty is that you would learn every aspect of how to provide value to that avatar.

Because I'll tell you a story to drive this home. I had an agency owner who was on our software platform. And we have one call every month or something that I hop on. And I've seen it's the same conversation. Every month, hey, you know, my customer suck. No one wants to pay me. And, you know, over and over again, I was like, you're not good. That's why they're not paying you.

You're not very good. You need to get better. Right. And so every time I was like, dude, stop saying that they tell you that their system's bad. And you say it's good and they say it's bad. Why don't you go? And he was selling to realtors. He was selling these to realtors to sell houses.

And I said, go get your real estate license. Go work the leads that you're getting right now. Go sell some houses for you. then when people say that something's not working, you can help them because you've actually done it. Everyone's so consumed with trying to sell them and they're never done that they're surprised that they're not good at. It's the business guru who coaches on how to have a business, who never had a business, and his entire business was coaching on how to have businesses. Right?

That guy never gets big. You'll make some money, but you'll never get big. True. And Sonia is asking, how long guarantee results on the relationship markets as dating, family, marriage. How do you transfer that same guarantee to those kind of markets? It's great. So with those types of markets, you just create the guaranteeer and the experience that they want to have. All right? So this is what's the beauty of being creative as a market or a business owner. And I'm not saying the first guarantee is going to hit. But if you interview

your customers, you say, describe to me what you want your marriage to look like. Describe to me what you want to have happened. For some of them, it might be we go on dates again. We go on dates together once a week. That might be what it looks like. It might be. be we finally sleep together again after a long time we haven't haven't been together. It might just be that like we wake up in the morning, we don't hate each other or we haven't had an argument in a week, right? It could be any of those types of outcomes depending on what type of marriages or solutions. I'm just using marriages as an example, right? And so it'll probably have to be around something a little bit more intangible, right? Now, the key here is, even if you have something

that is intangible, you can still guarantee it because the goodwill from customers typically will still surpass the desire to refund. What I mean by that is, let's say you've got 10 customers, and normally if you sold your normal services, you'd only have three. But if you saw it with a guarantee, maybe you get 10. Of the 10, maybe two of them say, I didn't experience the result you were looking for. Right. Now, of the other eight, let's say you were promising they're going to sleep with their partner within 90 days. I'm just throwing out there, just as a crazy example. And let's say at the end of 90 days, they didn't sleep with their partner. But if their relationship is significantly better and they feel like they are making progress towards that goal, they will not ask for a refund.

People want to see progress, right? And so what's important is, and also in terms of the language, the messaging you use when you're talking to your audience, this is what I try and talk to you in terms of everyone here when I talk to entrepreneurs is that we have this psychological bias towards binary thinking, which is yes or no, good marriage, bad marriage, right? When it's much more to what extent or how good is my marriage, right? So it's a scale, it's not yes or no. And so if you can teach your clients to think on a continuum rather than in the binary, you'll shift their thinking enough that it won't even matter because if they've made that frame shift, then you will have gotten them on a progression that they will be able to continue to improve over time, and they

will contribute that improvement to the intervention that you've provided for them. So basically, it's selling the experience to them and basically ensuring that they get progress along the journey. Yeah, so I would just like to ask, like, when it comes to qualifying the avatar that deserves your grand slam offer, right? I mean, you won't just put together a very good offer and give it to anyone because it might be deeper to get the results because you have, maybe they have a broken system or something. So how did you make that process work? I know you start with gyms, but you know, in other verticals where it's difficult to predict certain things. How would you do? Yeah, I mean, we have, we have business opportunity companies. We have,

we have photography companies for children. We have a company that does like I said, we have a software that is leadworking. We have a e-commerce company. We have a licensing company. So we have a vast, you know, a vast array of different companies that we have a certification company. Vast array of different things. I'll say again, you can increase the quality of your product when you increase the

quality of your prospects. And so the easiest way to look at this is look at the customers that you like the most, the ones who have had the most success, you sing your praises, right? Sing your songs. And look at them and then compare them to the people who you do not like, who haven't had a good experience. And then what you do is you go backwards 90 days and say, what was the experience the people who one had in their first month? What are the things they did that were different than the people who fail?

Once you can delineate what those things were, it might be milestones that are achieved. It might be a certain percentage of material that was watched. It could have been coaching calls attended, whatever type of solution you're providing marriage, weight loss, business, whatever. It could be any of those things, right? And there's probably some associated action that has to go with it. If it was weight loss, it might be logging food. If it was business, it might be sending emails. If it was marriage, it might be filling out the checklist of things they love about their partner, whatever it is, right?

What are those milestones that have to occur to activate the customer so that they're likely to experience the outcome that you were promising them? And so what the metrics of your customer journey should look like and your customer success team should be driving towards those activation points, those milestones. So if we know that people who have both spouses who fill out the checklist of the things they like about each other and their favorite memories of their relationship, We know that if both people fill that out and they attend two calls in their first 14 days, the likelihood that they finish the program and experience great results is three times as high. So then all of your effort goes towards pushing them through that milestone so that they can change the color of their flag and then get to where you want to go. So that's ultimately how you can change them. And when you're looking at reverse, that's the experience side.

That's the fulfillment side. But you might also note that this person, you know, has a business or is gainfully employed and this person is unemployed and a stay-at-home mom. okay well then these are the people not only they did this experience which i'm going to try and do on my back end but on the front end i'm going to try and weed out these people and actively select for these people and then what's beautiful about that is that is an element of niche in right and so when you're making your messaging you're making your creative and your marketing you can speak more specifically to that avatar rather than all marriage you know relationships that you're helping you help stay-at-home moms with working husbands achieve a better marriage who are between

in the ages of 30 and 50. If you're that avatar, you're like, shit, that's me. Or it's, I help entrepreneurial men, you know, fall back in love with their wives again. Whatever, right? Like, whatever your outcome is. But you can be more specific about it. And in so doing, you can command higher prices because you can provide more tailored solutions, which in a very real way provides more value to that avatar, even if the fulfillment looks the same.

You guys, love that you're listening to the podcast. If you ever want to have the video version of, this which usually has more effects, more visuals, more graphs, you know, drawn out stuff. Sometimes it can help hit the brain centers in different ways. You can check on my YouTube channel. It's absolutely free. Go check that out if that's what you are into. And if not, keep enjoying the show. So basically, let's assume now this is like, you know, my space is basically cost creation and I help cost creators. So if I want to work with people who are more further along in their course journey and I've made certain sales, right, I basically have to,

you know, it affects, I basically have to like, tell them, and, you know, for me, I focus on cost creators who are like in a business cost place, who are, you know, trying to sell causes that give people a financial array, right? So it's just basically, you know, tweaking your messaging to focus on those people and, you know, read out every other person who's in other spaces. 100%. So I'll give you an example. And for some reason, it's harder for people. But the thing is, is that they don't change the economics of their business when they change the economics of the avatar. And that's where you get into trouble. So, for example,

whatever your price point you're selling at right now, if you change your avatar from anybody who's a course creator to people, then you'll probably be providing far more value to those people. One, because your process will be more tailored to their approach, but also because if they're selling business stuff, then they're probably going to be able to charge higher premiums for it. And so as a result, if they experience a transformation using your system, et cetera, then they're going to make real money, right? And so if you decide to be more selective with that avatar, then that should be reflected in the pricing and the fulfillment that goes along with that. So the easy example is we made a decision very early on because I was in the gym space that we were helping gym owners. We were not helping personal trainers. We're not helping online trainers. We're not helping health coaches. We're helping just microjum owners.

And so by doing that, half to two thirds of the volume that I would get every single day of people that they were opting for stuff were not qualified. But the people who tried to compete with us and tried to sell all of them wasted so much time because the LTV of those customers are so low. And the amount that they required was so high. And the amount that you'd have to go from zero to one for so many of these people, which is the heaviest lifting in all of business is getting someone to make their first dollar. I had no interest in doing it. I wanted to say people were making half a million dollars a year and get them to a million. A very simple outcome. It's all I'm doing.

And I consistently would just do that. We just, boom. We take you from half a million to a million. half a million to a million, because that's something that I can repeatedly do over and over and over again, and I can demonstrate that value in a very, very high degree of success. And so if I do that, then I have a very demonstrable way to provide value, and I can monetize that value accordingly, and I can do it with lots of operational efficiency since the process is so, so clear cut between each customer.

Awesome. So talk to us a bit about grow or die. I mean, that's one of your tenants in your company, right? Yeah, you talked about market efficiency or basically, The market is growing by 30% every year. And if you don't skip up, you basically are going backwards. So how do you tweak your offers in your companies every single year or every single, you know, what period of time?

How do you walk around this? It's more about embracing change and about being flexible. In terms of like the goals that we set, you would be surprisingly bored by the types of goals that we set within our company. You know, I can tell you the last quarter's goals, we always trickle back to the same things. Because it's either if we're going to grow, we can only do two things. We can either get more customers or we can make them worth more. That's it. And so we'll have two to three goals tops.

We never have more than that for the company. That'll be like, okay, well, we're going to take wherever we see the weakest point within our pipeline, which maybe the pipeline's great. It's like, okay, well, we just need a double front end volume. But I wouldn't make the goal of doubling front and volume. I would probably make the goal of bumping front end volume by 10 to 15%. That would be the goal for the quarter. And I would say we need to ascend, we need to take our customer ascension from 40% to 50%.

That would be the back end up. grade, right? That would be, one, is getting more customers, the second is making them worth more. And that would be literally the goal for the entire company. And so then the directors would come up and say, okay, well, I think in order for us to get a 15% boost in volume, you know, based on our total call volume right now, we would need to add three more outbound development reps to the call team. And that would mean we need to add one sale development specialist, which is our mid-level salesperson, and one more closer. It's like, okay, so we need to hire five people. and right, that's what we're going to do.

And maybe we need a higher six or seven because we might not get the ones that we want to keep on the first go around. That's what we're going to do for the front end. That is the tactics of how that's going to happen. And then on the back end, what we're going to do is we're going to add these two touch points in,

and we're going to make this process that's been a little bit difficult for them a little easier so that hopefully we can get another 10% of those people to upgrade. That is how we improve the business. We're not doing rocket science here. We're just trying to, you know, incrementally improve these things. And if I improve by, you know, 15% on both of those metrics every

quarter, in six quarters, the numbers become crazy. And so I think a lot of people, they try to solve a hundred problems at the same time. And it's just, it's, it's impossible for your team. You need focus. Focus is knowing what you're going to say no to, not what you want to do. There's a hundred things we all should do. And for perspective for everyone, we crossed 50 million in sales before we started doing email follow-up because I always felt like we had there were other opportunities that had more juice to squeeze than email follow-up for me and my business. And so that whole time, when we were at $10 million, at $20 million to $30 million, we should have been doing email follow-up. But there were other things we should have done more, which is what we did. And so it's just about

knowing what we're going to say no to and the one or two things that we're going to say yes to, because I think most people wildly overestimate what they can accomplish in a short period of time. True. So you said there are so many problems that you know, a business or an individual or a market faces. And, you know, in your book you said we should solve every single problem. How does that? Because when I tried to introduce that to some people, it felt like, I mean, it's a lot of work, literally writing about a hundred and something problems, right?

And trying to solve every one of them. So, I mean, how does that affect your marketing overall? So you have to solve every perceived problem, right? the way in which you solve that, that comes down to the delivery cube, which is in the book, right? So I'll give an example. I'll use weight loss because everyone understands it. So if I had a girl and she needs to lose weight, there's a lot of things that she has to do that are different now than she was doing before. So she might now have to buy groceries differently than she did before she started working with me, right? Just as a simple example.

Now, there is a zillion ways I can solve that problem. So it's not that you have to go grocery shopping for every customer. It's that you have to solve the problem around the difficulty of grocery shopping. So, for example, I could have a pre-made Instacart for six sets of customers at different weights that I could copy and paste to her and then she could click one click and she gets it ordered to her house. Easy. I could make custom lists. You know, I could make an Excel sheet that adjusts based on every customer if they enter their weight in that adjust the grocery list for the week. That's the second one. I could make pre-made list, not even a calculator, just pre-made PDFs for 100 different weight scales. And so that way it's still tailored to them,

but I do that work up front. And then after that, it's just plug and play, right? I could do a large group grocery shopping tour. So everyone meets there and then we grow grocery shopping together. If I want to do it virtually, I could do a virtual grocery store. Or I could do the live one, record it and then make that the thing that I'm saying is a fulfillment. I could also do a 101 grocery kind of like, I'll help them create it together as a one-on-one session as a bonus for signing it for my weight loss program. You see what I'm saying here, like there's all I did with there's one problem. And we just looked at how many, you know, I could offer text support. So when you go to the grocery store, you can text me and I'll help you pick

anything that if you have trouble with it. I can have phone call support. Like the list goes on. And so it's really just limited by your creativity in terms of what you want to do. Notice half of those things were not creating anything, it was just being available. And if I had text support compared to a PDF, most people would probably value the text support higher. I may or may not be willing to do that on a level of fulfillment, which again, I would go back to my first tenant, which is if you don't have that many customers, be willing to do more so that you can over-deliver, learn more about them, and then over time, become more operationally efficient. But big picture, yes, we want to solve every problem in some way.

And then over time, what will improve your product in your business is how effectively you solve that problem relative to the cost to you. That is fundamentally like Amazon took tons of time to invest in building that infrastructure. But now, the marginal cost of any customer on Amazon is nothing, right? They're very low, right? And so you could either put the workload on the front end, you can put it on the back end. I prefer to do it on the front end and consistently improve on it. And that's where you have customer surveys. And as you're fulfilling, which is why I like more hands-on approaches in the beginning because you're learning more about the customer. That data and the stories behind what you're going to discover there

are so valuable. It's silly not to do it. I hope you guys enjoy part one of that podcast with the manual, uh, Bolo. Next half of this podcast, we actually go back in time. I'll talk about how we gather testimonials, gather reviews, and how do you tactically go get leads in the beginning of your business so you can go get sales, make money, and do the stuff you need to do. Don't want to miss it.