$100M Offers

Author: Alex Hormozi - A rich guy that wears nasal strips

Useful supplementary materials: https://www.acquisition.com/training/offers

"How to make offers so good, people feel stupid for saying no"

1. The Offer

The offer is what attracts customers to your business, and is usually the first point of interaction between them and you. It sets the stage for the rest of their interactions with you. If you can come up with a "Grand Slam Offer" then you should have no problem making at least $100k

2. Pricing

If you're not growing, you're falling behind.

How to grow:

1. Get more customers
2. Increase the amount that they spend
3. Increase the number of times they buy from you

How NOT to grow:

1. Decrease prices.
2. Work in a commodity market where competition is fierce.
3. Work in a market that is declining (e.g. newspapers)

3. Finding the right market

The best way to sell hotdogs is not by having a great location, low pricing, superior quality, or wide variety. It is to sell to a starving crowd. You can sell terrible hot dogs at outrageous prices, but when people are drunk and starving, and you're the only place open at 2 AM, then you will sell out. (rough quote from the book)

When picking markets:

1. Massive pain.
2. Purchasing power. (Sell to rich people. Don't sell to broke people.)
3. Easy to target
4. Growing

Pick a niche, and be extremely specific, as you can charge more for highly specialized products. If your product is actually specialized to that market, you will provide much higher value to much fewer people, which is usually a good way to start a successful business.

Example:

• Sales Course: $19.
• Sales Course for Outbound B2B Power Tools and Gardening Equipment Sales Reps: $1999

4. Charging what it's worth

Don't fall into the trap of decreasing price to gain a competitive advantage.

When you decrease price...

• Clients are less emotionally invested (they have less to lose)
• Clients have a lower percieved value of your product
• Clients get worse results
• Clients become more demanding, more annoying, more needy. They want your product to be free.
• Clients realize your product price is negotiable (bad)
• Your profit margin decreases
• Your own percieved value decreases
• Your level of customer service decreases
• Your sales team conviction decreases

Be more expensive than everyone else, by enough that it causes customers to pause. Your product must be in an entirely different category than the competition to justify the price. Consider the wine tasting example. Wine tasters rated higher priced wine as more tasty than cheaper wine. But of course, they were all from the same bottle. Clients get more from higher priced products.

5. The Value Equation

Maximize value by considering 4 variables:

(Dream Outcome Perceived Likelihood of Achievement) / (Time Delay Effort & Sacrifice)

• Dream Outcome is the solution to the client's problem, or the goal your product will help them achieve.
  • Make bold claims.
  • Show that your product is in a category of it's own.
• Percieved Likelihood Of Achievement is the chance that your product will deliver on its promises.
  • Use social proof. Testimonials are good. "Steven's website is amazing!!""
  • Testimonials with quantified results are great. "Steven's website increased my productivity by 3.5x!!"
• Time Delay is the time until results are reached. Working out takes months to see results. Liposuction is immediate. Working out is free. Liposuction is expensive.
• Effort & Sacrifice is the amount of work your client will have to do in order to see results. Working out takes lots of time, hard work, and dedication. Liposuction does not.

Interesting fact - it is usually easier to focus on the denominator of the value equation. Reduce Time or Effort to zero, and your product value will skyrocket. Imagine a pill you can swallow that immediately gives you a six pack.

People value 'fast and easy'

6. Divergent Thinking

Buisiness is not a math equation. There isn't just one right answer. Think of as many solutions as possible to the same problem, instead of the first one that crosses your mind.

7. Creating the Grand Slam Offer - Problems and Solutions

1. Identify the customer's dream outcome. For example, a car ad that just shows old rich people driving fast with beautiful women, without mentioning any features, safety ratings, etc.
2. List problems. All of them. I like to sort them by the 4 value equation categories:
   1. Problems associated with the dream outcome
   2. Problems associated with likilhood of success
   3. Problems associated with time delay to success
   4. Problems associated with effort and sacrifice
3. List a solution to every problem.
4. Create a 'solution delivery vehicle' that solves every problem. People very often get hung up on one unsolved problem, and won't buy because of it.
5. Trim and Stack. Adding any features should increase the result of the value equation.

8. Enhancing Your Offer

Desire comes from not getting what you want. Would you rather buy a limited time, one of a kind T shirt, or the same T shirt but it is always available?

5 Strategies:

1. Scarcity: Limited quantity. Weekly product 'drops'. FOMO. Get it before it runs out. Make sure to sell out, or people will see through it. "Sell out" even if you still have inventory.
2. Urgency: Limited time. Act now. Only available if you call in the next 30 minutes.
3. Bonuses: A single offer is less valuable than the same offer broken into its component parts and stacked as bonuses. Offer freebies from other companies for win-win partnerships.
4. Guarantees: Be creative. Use a strong guarantee. Many customers won't take advantage of it. "If you tell me to my face, that my product sucks, I'll give you 3x your money back"
5. Naming:
   • M: Make a magnetic reason
   • Black Friday, Summer Sale
   • A: Announce the avatar
   • G: Give them a goal
   • I indicate a time interval
   • C: complete with a container word
   • Challenge, Blueprint, Bootcamp, Cheat code, Experience, Solution.