The Game with Alex Hormozi - The Sales Tactic that added $35M in Sales | Ep 258

Episode Date: December 15, 2020

Sometimes it takes one action to curve your life in a better direction. Today, Alex (@AlexHormozi) talks about a pivotal moment in his life when he was pitching and the amazing sales tactic that helped him grow his money exponentially.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:(1:11) - The struggle and breakthrough in supplement sales(3:55) - Introducing the game-changer: the assumed close(5:17) - Expanding the strategy: upselling across locations(6:01) - Applying the assumed close beyond supplementsFollow Alex Hormozi’s Socials:LinkedIn | Instagram | Facebook | YouTube | Twitter | Acquisition

What I want to share with you is the one sales tactic that is directly made over $35 million for my company. And I want to show you how I learned it. 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. So when I was at my own gym back in the day, probably eight years ago, I was really struggling, right? And I was traveling to come back home or something. and during a layover, I saw this guy that I used to go to college with.

And he was, I didn't think this guy was like, that one smarter than me. And, like, I was in some classes. I was like, I don't think this guy's that bright. And he sits down next to me and he says, he's like, oh, how's your gym? I heard you got a gym. And I was like, oh, you know, it's going well. I was like trying to be cool. And he's like, yeah, I've got this supplement store.

And I was like, oh, that's awesome. He said, well, I've got two locations now. I was like, oh, well, fancy you. And I said, well, what do you guys do like a month? He says, I don't know, we do like 70, 80,000 a month. And I was like, in supplements? He was like, yeah. And at that moment, it was like my mind broke.

I was like, if this guy can do this, I'm going to find a way. Like, I was like, I've got this whole gym full of people and I don't sell them supplements. And so when I came back, I was like 100% committed to selling supplements. I was like, I'm going to figure out how to do this. And every single client, I would walk into my facility, after I would sell them our service package, I was like, hey, buy these supplements. right? And they were like, no, I'm not going to. And it felt horrible. And I literally just again and again and again, I just kept getting beat up. And I bought all this inventory after I talked to that guy. And so this cash is just sitting on my shelf. And I was like, I have to find a way

to move this stuff. And so one day, I think I had 15 or 20 consultations. So I had sold a bunch of people into a new program that was starting. And I was doing all the one-on-one orientations. Now it was probably like 15 orientations deep. And I just headed no after no after no after no. And finally, I was sitting down and this nice lady walked in. She had like a nice ring in a nice purse. And I was like, okay, if I don't sell this woman, I'm going to kill myself. And she was like super upbeat. And anybody who's ever done sales, like, you know when you see that person, you're like,

I'm definitely closing this one. Like, I have to close this one. Like, this is how I pay my bills. And so she sits down. And I remember getting to the end of the presentation, and I just said, instead of my normal pitch around like hypertrophy and maintaining body mass and just a whole bunch of jargon that she would never even understand. I said, hey, so with the program, I was like, do you want to do, you want chocolate or vanilla for your protein? And she was like,

which one do you like? I was like, chocolate. She was like, all right, I'll take one of those. And I was like, I didn't want to scare her away. So I was like, I've got, for the pre-workout, do you want to do kiwi or strawberry? I like the kiwi. She was like, okay, I'll do that one. And I didn't want to sell any more because I was afraid that she would somehow back out. And so, and I didn't want her to like make any other purchasing decision. So I said, do you want to just use the card you have on file? And she was like, yeah, that's fine. And then I took these off the shelf and I slid them over to her.

And she grabbed them. And she smiled. And she walked out of the facility. And I made my first supplement sale. And I was like, holy shit. Hey, Mosin, Asian quick break just to let you know that we've been starting to post on LinkedIn. 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. I didn't even talk at all about what these even did or how to take them or what the benefits were. I just simply asked her which one she wanted. And the key was I didn't ask her whether she wanted them. I asked her which one she wanted. And as soon as I realized that, that is when I was introduced to the assumed close. It is one of the strongest upsells in all of business. Like I can't tell you, whenever I hear someone, if there's every sales process that generates tons and tons of traffic and they're closing anywhere in the 80% plus range, I usually know

that it's an upsell. And the beauty of an assumed close is that the prospect is choosing between two options that both are buying from you rather than whether or not they're going to purchase. And so the beauty is if you can construct your conversations in a way that makes the sale seamless and make it assume that they're going to have this extra thing with your program, you can immediately upsell a big, big, big percentage of customers, whereas maybe normally you might close one out of three or one out of four, or if you're really good one out of two of customers who walk in the door,

with an assumed close as an upsell, you can sell nine out of ten, nine and a half out of ten of the people that you sit in front of. you can close them at higher tickets at higher percentages. And part of the reason is because in an upsell opportunity, you're selling to a customer who already knows and trusts you, right? And if you pair the fact that they already know and trust you with the fact that you already have a purchase that's already happened, you have their information on file,

and then you simply present them with an either-or option that both include buying, you will typically get a huge percentage to take that option. And so this assumed closed rapidly transform our business. I ended up making just as much, if not more from the supplement sales in profit than I did from my actual facility. It became a staple in all the locations that I had. I was able to cover all of my advertising spends simply from the upsells. And so that took all of what used to be my service revenue and just turned that into profit

because I could cover all my acquisition costs simply with the upsells. I taught this to all of the facilities that we had, and they ultimately used that for selling prestige labs, which is the brand of supplements that we have that pays really, really high margins for gyms. And so that single experience where that lady, bless her soul, just said yes to the either or option is what significantly changed a huge part of my life. And so anyways, I hope you take something from that. I hope there's something you can look in terms of your sales process in terms of something you could upsell. It doesn't have to be a product. It can be a service.

It can obviously be any kind of retail stuff. Physical products is really easy because you already sold service. So you want to think about what's the next natural thing that they're going to want to need or want or want or going to have. to normally buy on their journey. And if you're like, I don't know how to find something like that. You just simply look at what the normal things that a customer will buy in addition to your services as a result of the decision. You know, fitness is an easy one. People go buy clothing, fitness clothes, they buy shoes. They might buy some at home stuff. They might start downloading some apps. They might get different groceries. So that's food or food prepping, food prep materials,

a crock pot, like all of those things are things that be accompanied, then obviously supplements. And so a lot of times when a consumer makes a decision to work with you on a service side, other additional purchases that they're going to make. And if you can, if you can predict what those are, which you should know, and weave those into your sales process as an either or a decision, you will usually get a very big percentage to uptake. And a lot of times those upsells can be all profit for you and even offset the entire cost of acquisition of getting a new customer.

So I can't even stress how impactful this was in my life. And so anyways, hope you found that valuable. Hope that was cool. If you like this stuff, you know, like, subscribe, all that kind of jazz. And I think I've got some trainings that you can go through for free. and go click do that and catch you soon.