The Game with Alex Hormozi - The 3 Biggest Levers in Business | Ep 257

Episode Date: December 11, 2020

You need all gears in order to fully function. Today, Alex (@AlexHormozi) shares with us the 3 levers of business growth that will have the biggest direct impact on how much money you make, and dive into discussing each lever.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) - 1st lever: market wins, regardless of circumstances(2:20) - 2nd lever: irresistible offer that's incredible(3:41) - 3rd lever: persuasion through words, charisma, and communication(7:17) - Market, Offer, Persuasion: these levers drive business growthFollow Alex Hormozi’s Socials:LinkedIn | Instagram | Facebook | YouTube | Twitter | Acquisition

Most of us are just in normal markets that are growing a normal amount. And the nice thing is if you're in one of those markets, you can still make a tremendous amount of money. 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. Good morning, everyone. What I want to do is share with you the three things that will have the biggest direct impact on how much money you make. All right.

And so these are the three biggest levers for growth in a business. three big levers for biz growth. All right? Going up. The first is going to be your market. And so the reason that investors look at this stuff is because they know that if you put a great entrepreneur in a bad market or a bad market

or a bad entrepreneur in a great market, the market will usually win. And so let me tell you a quick story about this to illustrate this point. So one of my friends, Lloyd, owned a great tech company. He started probably a decade ago. And they grew pretty quickly.

And then it sort of plateaued. And then it started to go down. And he was trying to figure this out. And he was struggling with it. And he called me up one day. And he was like, hey, dude, what do you think the issue is with this? And I was like, dude, you're selling your software to newspapers. Because that was his exclusive customer for his ad product.

And despite having an amazing offer and being a great salesman, because it was a zero risk offer for them. He only just Rev shared with them. Despite both of those things, he was not able to grow because he was in the newspaper market, which was shrinking by 25% every single year, over eight years that he had the business. He still has it to the side. But for eight years, he was trying to figure out what was going on. You looked at every single piece of the business, except for probably the most obvious one, which is the market itself. And so what I want to introduce you with these three levers, and that's the first one, is the market, is you have to do these from the top down. If you were in a horrible market, it doesn't matter how good your offer is,

it doesn't matter how good your persuasive abilities are, you will not be able to outpower a bad market. And so the way I look at these levers is, is this going to be a plus, is it going to be a neutral, or is it going to be a negative? And so as long as your market is not a negative, and is either a neutral or a plus, you can move on to the second lever for business growth. all right the second lever is your offer all right and what i mean by that is what you literally giving a customer in order to transact with them all right this is the the the products and services that you offer in exchange for money and in the terms under which you offer them and what they need to do to redeem them all right that is in essence what an offer is all right and so these are the terms

the price etc and what they get now if you're in a normal market or a good market or a good market, if you're in a good market, it doesn't matter. Right. If you were selling toilet paper during COVID, it didn't matter what, uh, what, uh, what your offer was or how persuasive you were, which is the third one. Uh, you were just, you were in the right market at the right time and you're going to make a ton of money, right? But most of us are in this market.

Most of us are just in normal markets that are growing a normal amount. And the nice thing is if you're in one of those markets, you can still make a tremendous amount of money, uh, by offering a unique offering and a good product, right? And so the offer is going to be the second thing. Now, if you have an incredible, irresistible offer, then more people will say yes, and you can make a tremendous amount of money. But again, here, you can have an amazing offer,

you can have a normal offer, or you can have a shitty offer, right? And as long as you do not have a shitty offer or a normal offer, you can move on to the next one, all right, which is the third big lever, all right, which is persuasion. So some people are naturally good persuaders. They're good marketers, they're good salespeople. And the thing is that each of these is more important than the rest. All right?

So it goes from the top down. So I'll give you some examples. If I were in an amazing market, it doesn't matter if my offer persuasion abilities are good. I'll make a ton of money. If I'm in a bad market, it doesn't matter if I'm in a good persuasion and good offering. I'm not going to make any money. And so basically, you can just move from the top down and check these off your list. And so most of us are going to be here in this normal market, right?

A normal market. You serve dentists. You serve chiropractors. You serve normal people who are in pain. Those are normal markets. They're not growing. They're not shrinking. They're just normal.

Right? Real quick, guys, you guys already know that I don't run any ads on this and I don't sell anything. And so the only ask that I can ever have of you guys is that you help me spread the words so we can out more entrepreneurs, make more money, feed their families, make better products, and have better experiences for their employees and customers. And the only way we do that is if you can, rate and review and share this podcast. So the single thing that I asked you do is you can just

leave a review, but take you 10 seconds or one type of the thumb, it would mean the absolute world to me. And more importantly, it may change the world or someone else. Now, from there, we move to our offer. Now, the thing is, is that this is typically the easiest lever on any business to grow the business, because any business, it takes a little bit of time to go from a normal offer to an amazing offer. You can't really go from a normal market to an amazing market with your business unless you change your entire business. But with an offer, you simply can repackage the value proposition how you charge in the terms under which you offer your services and you can move from having a normal offering or a subpar offering to an amazing irresistible offer. I call them

Grand Slam offers. And the reason I call them that is because Grand Slams are both very rare and very good. But the difference between baseball and business is that when you have a Grand Slam offer, you can knock the ball so far out of the park you can win for a thousand years. And that's the difference, right? In baseball, you can only win four runs, no matter how good your offer is. In business, you can win in for life. And so making the actual best offer is going to be the second biggest lever on your business. Now, let's assume that you've got a great offer. Now, if you have crap persuasion skills, you'll still make money. If you have normal persuasion skills, you'll make a lot of money. If you have fantastic persuasion skills, you'll make a tremendous amount of money.

Which leads me to the next piece. So let's assume that you're just having a normal offer, not an amazing offer, all right? Then it takes us to our third portion here. The only way, if that is your scenario, you're in a normal market, you're normal, you have a normal offer, the only way for you to be hyper successful is to develop persuasion abilities.

And so that's learning how to market and sell, how to acquire customers through multiple channels, right? And so the thing is that this one is usually the most difficult to acquire, in my opinion. It takes a lot of time, takes a lot of effort, takes a lot of volume, takes a lot of practice, a lot of failure in order to get good at this. all right and so if i'm looking at a business and i'm trying to grow it the first thing i'm

going to do is check this off is just say like are we making sure that we're not in a bad market and we're at least in a normal or good market you'll know if you're in a good market believe me like i said if you're selling toilet paper code 19 if you're selling hot dogs outside of a baseball stadium as soon as the game wants out you know you're in a good market right but most of us are here so as long as i'm not in a bad market i move on to the next one and so if i'm looking at the business i say okay what is the current offering what are we doing in exchange for money. What are we giving clients? What are the terms of the agreement? What's the price point? And what are they getting in exchange? And so then what I will do is shift the business from here in

this direction to create a grand slam offer. And the beautiful thing is this can literally take a half a day, maybe a day, right, where you just re, recombine, repackage, reposition, rename the offers, change the terms under which you make, you offer your businesses and services and products. And overnight, you can take a normal business to an extraordinary. business by doing this one thing. And then finally, the last thing that you can do is you can develop all the skills of persuasion. So if you're looking at the entrepreneurial journey, my recommendation for most people is I

start here. This is the first thing I will do. The second thing I will do is get them to focus here in improving this skill and going from a normal salesperson or normal marketer to an exceptional salesperson marketer because they should already be being reasonably successful because we fix the offer first. and then move up to the top of the biggest lever and say, now that we understand how to make amazing offers, how to persuade people in masses,

now let's go find a market that we know we can apply the skill set to that we think is going to crush it. So right now, if your business is not growing, it might be because you are lacking one, two, or all three of the levers that create success. And so if that, hopefully you found that valuable, hopefully you can think about your own business within this context. Am I in a great market, a normal market, or a shrinking market?

Is my offer insanely compelling? Is it normal or is it bad? Are my persuasion abilities exceptional? Can I acquire clients at the snap of my fingers whenever I want? Do they come in kind of semi-consistently, but I can't really grow it? Or do I have no idea what I'm doing? And I get people on the phone and I can never get money. And so if you can rate yourself on these things,

then you can identify where you have opportunities for growth and then follow these steps to get to where you want to go. So hopefully that you found value in that. Hopefully that was cool in terms of framing how growth and the biggest levers that exist in business overall and keep being awesome. And I will see you on the flip side. Bye.