I just read “$100M Offers: How To Make Offers So Good People Feel Stupid Saying No” from Alex Hormozi. https://www.amazon.com/100M-Offers-People-Stupid-Saying-ebook/dp/B099QVG1H8
I like his writing style. Here are my notes from the book:
Main theme from the book: “Make people an offer so good they feel stupid saying no”. This offer is what he calls the grand slam offer.
That will generate you tons of business.
The 2 main problems entrepreneurs have and he tries to solve in the book:
- not enough clients
- not enough cash (excess profit at the end of the month to reinvest)
The market is growing at ~9% a year, so you as a company must be that, otherwise you are in maintenance mode and dying. There are 3 things you can do to grow:
- get more customers
- increase the average purchase value
- get them to buy more times
You want a business that caters to “starving crowds” because they will buy your product no matter what.
starving crowd(market) < offer strength < persuasion skill.
The most common unmet needs that people will pay for and that will always exist:
- improved health
- increased wealth
- improved relationships
Your customers must have massive pain. Pain that frustrates them in their lives.
The degree of the pain will be proportional to the price you will be able to charge. When they hear the solution to their pain, they should be drawn to your solution, and inversely, what their life would look like without this pain, they should be drawn to your solution. The pain is the pitch. If you can articulate the pain a prospect is feeling accurately, they will almost always but what you are offering. A prospect must have a painful problem for us to solve and charge money for our solution.
The point of good writing is for the reader to understand. The point of good persuasion is for the prospect to feel understood.
Your target market must have:
- lots of pain
- purchasing power
- easy to target
You can create new businesses just by finding new subgroups that appear that are trending.
Don’t pick a bad market, and once you pick, COMMIT until you figure it out. If you try 100 hundred offers, you will succeed. Most people never try anything. Others fail once, then give up (sounds like me). It takes resilience to succeed. Stop personalizing! It’s not about you! If your offer doesn’t work, it doesn’t mean you suck. It means your offer sucks. Big difference. You only suck if you stop trying. So, try again. You’ll never become world class if you stop after a failed attempt.
If you keep going to specific niches, you can sell more of you product. He gives an example:
|time management for sales professionals
|time management for outbound b2b sales
|time management for outbound b2b power tools & gardening sales reps
You don’t just get more profit, but you maintain product focus and high converting messaging. Knowing exactly who the product is for is a game changer.
You want to solve this type of problem for this specific type of person in this unique counter-intuitive way that reverses their deepest fear.
In order to understand how to make a compelling offer, you must understand value. The reason people buy anything is to get a deal. They believe what they are getting (VALUE) is worth more than what they are giving in exchange for it(PRICE). The moment the value they receive dips below what they are paying, they stop buying from you. This price to value discrepancy is what you need to avoid at all costs. Warren Buffet said: “Price is what you pay, value is what you get”.
Everyone buys bargains. Some people buy $100k things for $10k, we want to live in the high price, but a steal for the value.
We are not trying to get the most customers, we are trying to make the most money.
When you decrease your price, what often ends up happening:
- decrease customer’s emotional investment
- decrease your customer’s perceived value since its not “cheap”
- decrease clients results because they are not as invested
- attract worse customers who just want free
- destroy your margin which means you can higher and grow to make the business better.
When you increase prices:
- increase customers’ emotional investment
- increase perceived value
- increase results because they value your service and are invested
- attract the best clients who are easiest to satisfy and cost less to fulfill.
- multiply margins because you have money to invest in better systems, people, experience, etc.
You want to price so much higher than the market that prospects think to themselves: “this is so much more expensive, there must be something entirely different going on here”.
An important point he makes: if you offer a service where a customer must do something in oder to achieve the result or solve the problem, they must be invested. Ideally that means pricing your service or products in such a way that it stings a little when they buy. The sting forces focus and attention into their investment.
He gave an example with his gym business where he wanted to be the premium leader to create allure around what they were doing so he looked at the market and priced 3x higher than the highest and 32x higher than the lowest.
Never charge more than what your product is worth, but always charge more than the cost to produce it! up to 100x more! And if you are really providing value, it should always still be a steal for your customers.
he has a a value equation:
Marketers focus on dream outcome and likelihood of achieving, but the harder parts to fix are time delay and effort & sacrifice. You want to focus on getting the bottom to zero. If you can get the bottom to zero, you really win.
The grand slam offer only becomes valuable once the prospect perceives the increase in likelihood of achievement, perceives the crease in time delay, and perceives the decrease in effort and sacrifice. Try to frame benefits in terms of status gained from the viewpoint of others.
Even if your product has a long time delay, you can improve things by having short-term experiences that show value is coming along the way. People buy the long term value (dream outcome), but the stay long enough to get i from the short term experiences. So you need to create emotional, short term wins immediately after they start paying. This lets them know they are on the right path and that they made the right choice.
A good example is liposuction vs exercise, both make you look skinny, one is immediate and costs $25k, the other is $100/month for a loooong time.
The only thing that beats “free” is “fast” and people will pay for speed. You could beat free with fast as a strategy.
He gave an example comparing effort and sacrifice of a gym vs liposuction:
Here is another example he gave comparing meditation vs xanax:
How to come up with your grand slam offer:
step1: identify the dream outcome and try to add a crease in time delay like “lose 20 pounds ( dream outcome) in 6 weeks (decreased time delay)”.
step 2: list every problem for the prospective customer, every single problem related to the issue! What are all the problems that happen immediately after they start to use you product. The more problems the better, because it means we can come up with more solutions. These are the opportunities for value.
step 3: Solution flipping: then we turn the problems into solutions and give them names. For example, we can turn the the problems into solutions by adding “how to” in the beginning so “its hard to buy healthy food” becomes “how to buy healthy food”.
Here is an example list:
step 4: create your solution delivery vehicles (The how)
This is the most important step. Think about all the things you could do to solve each of these problems. The goal here is to push your limits so list our everything. He also advices to think about do you want to do 1-1 solutions, small group, 1 to many, etc.You want to think about the experience: DIY,DWY, DFY. How to deliver, in person, slack, zoom, email, etc. Response time. 10x to 1/10th test, how much would someone need to pay you to do it. Try to solve every problem from your list.
Here is his product delivery cheat codes:
Step 5: trim & stack . First remove high cost & low value items, then low cost low value items. You want low cost, high value and high cost high value items to form your full product.
He says he has always lived by the mantra: “Create flow. Monetize flow. Then add friction.” Meaning he generates demand first, then take the offer and get people to say yes, and then and only then add friction such as offering less for the same price.
Great book, I will reread it again to absorb more later!
To learn more, I also listened to his interview, the notes below are for the interview:
Learn to market/advertise, then sell, then build product.
Work on one thing at a time.
rule of 100: what is the activity you can do daily that will move the business.
100 X per day for 100 days is how you can make tons of money.
So it could be 100 calls, or spend $100 dollars on ads, etc per day.
traits of successful people:
- superiority complex – big dreams
- crippling insecurity – think they suck
- impulse control – can have extreme focus
hold the frame – structure the sales call. you must have a clear and thought out agenda.
if you sell properly, you can empower someone.
the goal is to get people to make the decision not to get ppl to buy.
is this solution going to help you?
do you want to work with us?
do you know someone with money to buy it?
he was missing focus and discipline.
“optimize to make the game fun in the loss.” – Tom Bilyue
because you will continue to lose over time, so to be able to keep going, you need to make sure you always have some fun in there so you can keep going.