Alex Hormozi's Best Advice on Offers & Pricing | 1 Hour Compilation

0:00I sell basically complete digital marketing services to service based businesses in Australia. I move >> SMBs >> uh like cleaning companies, stuff like that. Cleaning, yard work. >> Average revenue for >> average revenue per company is anywhere between >> half a million to 2.5. >> Tough. >> The ones I sell. Uh I pivoted. The company's gone from zero to 500k in the last four four months. It's I pivoted from fitness. Uh it just happened. So it worked out well. Uh so they all been wound down getting other people operate.

0:28I'd like to ideally get to eight figures. Uh, in terms of what's stopping me, I well, I spent the whole 28 hours here going through every framework I could to figure out what's wrong. >> Yeah. >> I just want to figure out, >> can I tell you what it is? >> Good. I also want to figure out uh where would be besides like getting the operations and moving out to other people and making sure I'm not involved in delivery. Where would be the best use? >> When you get to three, 10 will suck. >> Yep.

0:52>> Yeah. That's what's going to >> Yeah. So you're four four months in, say you're it's it's brand new and you haven't seen all the [ __ ] that's about to happen. So what's going to happen is because you're because you're servicing SMBs. Yep. >> Their volatility will translate over to your volatility. >> And independent of how well you do, they will start turnurning. >> Um and you have probably mastered the sales function, which is why you're growing quickly.

1:15>> Um but you also will have like CAC will never be cheaper than it is today. >> Yeah. So CAC will always go up >> and churn is going to start eating into the business because SMBs suck. >> And so we what's going to happen is that your margins will continue to compress and compress and compress and you have to spend more and more. C will go up. You'll have to hire more people because of churn. That's what you're going to think you're going to have to do in order to fix the churn, but it's not. But whatever, let's go to it. And so you're going to keep going, keep going, keep going. And so revenue keep going up, but the margin gets smaller and smaller until eventually you're just like, I feel like I'm running a nonprofit and I have to just keep selling stuff and I don't even feel confident about it because I got all these people complaining. It's really because they are the business owners who suck. And then you think maybe I should take more more responsibility for the business owners. I'm going to start maybe doing some sort of sales motion, some sort of, you know, nurture motion because they suck at sales. They don't know how to run their business and that's why they can't market with me.

1:59But I'm going to do this because I want to take, you know, responsibility this and all of that is just wrong. >> Yeah. >> And so if you want to get to three million bucks a year, you can just do what you're currently doing. Yeah. >> You'll just sell more and LTV will probably be what's your price point? >> Uh $450 a week. >> A week. Okay. So you're 2K a monthish. >> Yeah. So you're right in the sweet spot of churn. Like that is like if you like 1500 to 3k a month for an SMB average stick is going to be four to six months.

2:27>> Um and so you can back nap back of napkin. How many are you selling a month right now? >> Uh I'm selling about 10 a month at the moment. >> Cool. So if you're selling 10 per month, right? And uh you said 2K was your price point, right? So let's say that we have five turns on that on average. 10k, >> right? And send per month. >> Yeah. >> Right. So, you're going to get to 100Kish per month.

2:55>> Um, and then you will stall. And so, at that point, you'll either have to increase units sold or increase LTV. And then you'll keep thinking, man, if I could just get this to go up, it'd be amazing, but you won't be able to. >> Um, and so the only way to really make SMB work is to go the opposite end is to go super super cheap. >> Yeah. and then build something that cost you nothing on >> nothing to deliver.

3:18>> Yeah. So, it's like $400 a month or less for an SMB if it's a nuisance style. So, I'll give you some examples. Um, if you were like, I can get you ranked on first three of maps in your local area and I charge $400, $500 a month, >> they'll do it because they can see it. Y >> and they'll pay for that. >> Um, review management um and SEO stuff.

3:43uh they will pay $300 to $400 a month and they will stick on that. You'll get like 30 to 40 month stick rates on that. Um but you'll close way more sales velocity. Uh so LTV is actually similar to this but CAC stays super low >> um as a result. But I know you just got out of fitness which you probably got out because it was terrible and hard. Um you might need to just go and get to there and then you'll feel good about things. Um like you might need to walk this path rather than believe me. But that's probably that's what's going to happen. So what do you want to have happen?

4:15>> Not walk uh to not have to walk the path in the first place. >> Okay. [laughter] Um >> get a lesson out. >> So this is like the this this is me just being real like marketing there. So I mean obviously a lot of marketers follow my stuff and so I get a disproportionate amount of marketing agencies and I've seen every model under the sun. Um SMBs suck as customers. Um and so you have you have to do this one or the other. You have to go up market. You have to go down market. Um, and you guys go really cheap and it's something that's super automated. Uh, or you do truly do more of these high touch services, but you do it with a business that actually knows their metrics, actually has a sales process, already has a proven model.

4:50>> Uh, rather than all of them just like wanting to change their stuff all the time, not knowing what they're doing to begin with because like they're expecting you to figure out something that they haven't figured out themselves. >> Um, and so that's so like your price either goes up and you serve a higher level avatar, >> uh, or it goes down and you serve the one you are now, but you make sure that your delivery is almost nothing. >> Yeah. And then it becomes a CAC issue because you have to offset CAC. And so then it becomes big head long tail one time setup into very small recurring monthly high gross margin.

5:16>> Those are the two models that work for what you want to do. >> So drop low, go high, and in the middle it's just a dead zone >> where everyone dies. >> Cool. >> Currently, uh just for context, I run an agency and um watching all of your content. Um you said, you know, in the beginning, so I'm transitioning from freelance to owning my own business and I've been in business for around seven months now. Mhm. >> So I am giving away, you know, diagnostics, a proposal, and then a solution fulfillment for free.

5:46>> Cool. >> Like uh like you said, and um uh for three reasons. I'm trying to get a proof of concept for my uh >> for what I do. Sorry, I'm a little bit nervous. Uh for what I do, um collect customer testimonials and then obtain metrics for future pricing when I do have um paid customers. >> Yeah. Um, the problem I've been having is that people don't don't want the services for free and I feel like maybe I've been targeting wrong, but whenever I do get on the phone,

6:16>> they don't they would rather pay. >> No, they just they just don't want the services. They end up ghosting me or whatever happens. It's been very difficult to just do work for free for someone and >> I came here with someone. >> Yeah, it's it's the hidden costs. >> So, it's asking why not? And it's the answer to that question, by the way, is like the the big pile of gold because you'll often find that the price that you charge is not the most expensive thing about making a purchase with you.

6:43And so I'll tell you how a content agency was the one that got me to start making shorts. So that wasn't me. Uh guy reached out in the DMs and said, "Hey, I want to make shorts for you. I will do everything. I will take content you already have on the internet to make the shorts. I will send them to you every week. you just need to say yes. And I was like, okay.

7:07And so then he did that for a month and made good shorts. And then he said, would you be okay paying me to do this now? And I said, sure. And that's how he did it. And then in the beginning, he flew out on his own dime. And I would do a hundred shorts in a day. And then that was what I did once a quarter. And then now we do like a one-hour session every other week. And that's kind of how we make our shorts now. Obviously, we get a lot from things like this, which is where a lot of the other shorts come from.

7:31>> Gotcha. >> But right now, you have to ask why not. It's like, hey, I know you don't want to buy. Totally cool. Why not? What are the things that are like if it's a proof thing, then it's like then you can work on that. If it's a I just don't want to do this work, then it's like, cool. Specifically, what things do you Because sometimes it might be misunderstanding. They expect that they're going to have to do all this stuff that they might not have to do. But if you can then solve the next three, four, five problems, then you have a very valuable service.

7:56And so it's just figuring out what the the friction points are. And I'll also ask the same question asked here, which is how many people have you had this issue with? >> Um, so I've had about five leads come in in the past month and been denied by all of them. I I've had them on the hook, but >> yeah, >> they just Well, the thing is is right now your issue is actually lead flow. >> Yeah. >> Because if you have five leads and you were like, I'm converting 20%, that would be a really good conversion process. And so you probably just need to get another 20 at bats because I'll bet you if those are the first five leads that you really walked through the process, you probably stumbled. You didn't know how to frame the benefits well, but to it was sloppy. I'm not saying as a dip. I'm just saying like you will be better in a year than you are now. And so I don't think you have the wrong strategy. I think the execution is probably not as good as it should be. And then the sample size is so small. So, I would still ask why not, but I also wouldn't really change much right now because you probably just need to take another 25 or 50 of those appointments, which then means first objective when you're a small business owner is let people know you exist because no one does. And so, it's all about the first four hours of every day when you're starting out is all advertising. So, like you wake up, you have to be like, who's my leads? Like, yeah, you know, like who's got my customers? That's like that's what you have to do until noon and then you can deal with everything else. So 6:00 to noon, 8 to noon, whatever your schedule is, like you only your big what's the big domino for me. If you had a hundred leads a month coming in, you wouldn't have a problem. So just solve that.

9:22>> Okay. Thank you. I just like to finish this off by saying um I'm 22 and you were one of the biggest inspirations for me just being like, I need to get this started, you know? So thank you. >> You look like you're 40. [laughter] >> A little harsh. >> I appreciate it. No thanks, man. I appreciate it. All you, dude. It's all you. >> There's a millions of other people who do nothing. So, it's all you do. The offer is still king, just like it was last year, just like it was the year before that. The offer still matters more than everything. And so, we um have begun the process of donating um a lot of the books from the launch. And we basically made the offer pretty simple.

10:01One of the variations that we've test, we're testing a bunch of different variations, but one of the variations was like, hey, just pay for the shipping of three books and you'll get all three books and uh just pay for the shipping of them. And so, right now, I actually lose money, like literally lose money on that, even with the books being prepaid. And still, and what's what's crazy though is that the metrics that I've seen from that offer in that funnel are better than any that I've ever seen in my entire career in marketing. And the reason I find that to be so interesting is that like we we whip that together so quickly and it's working because it's the offer stupid. Like how do you make an offer so good people feel stupid saying no? It's in the [ __ ] sub headline, right? And so I'll give you a couple more tidbits that I've I've kind of like gathered together for myself.

10:47The reason we're able to break the record is because the bundle for donating 200 books were so strong and so compelling which I spent two years building. The next thing is that whenever you have components of an offer or bonuses that you're going to include in any kind of offer, any service, any anything, right? Each bonus should be worth more than the entire value of the thing you sell. I believe that most buyers are single issue buyers, like single issue voters, is that they keep listing until they have that one light, that one key, that one unlock, that one reason why that say that was worth it.

11:22And so if you ever try and put an offer together where you think, oh, the aggregate of these things is worth more, you have already lost. And if the bonus itself is complex enough that you have to explain it, delete it. Because the most expensive part about you explaining different components of the offer is the mental real estate it takes up to actually explain it. And so if something is worth saying, make sure that it's worth saying. And when you also build offers in this way, it forces you to think even more about how can I make this more compelling? How can I make it simpler? How can I make it more compelling? And each one of them has to has to carry their weight. And by doing that, you'll create a more operationally efficient business. Number one, and your offer, I like to use this as my kind of um my like razor for making a good offer is that the offer should be textable.

12:12Can I text to someone? And then them say, "Yeah, I'm in." And that's just a great way like you you've got this much screen and that many words to to say the essence of the entire offer and if you can't fit it there, it needs to be better or it's too long. And so that has just been really valuable for me. And I've had that I've had that reinforced this year several times. Obviously, we had the the the offer at the launch. We we're donating the books on the back end, but even within the portfolio companies, I mean, the reason I think that the offers book will always outsell the other books in general. I think money model is not selling now cuz it's new, but like I think long longterm offers while it sell is because like if you nail the offer in a lot of ways, nothing else matters. It's just getting it right is so hard. But there's nothing that you can do that can make your business have a have a bigger step change in your business's revenue and profit than really making the offer better. And it's like again, I think on some level people have an understanding of like what things cost. And the reason that I think that book bundle works so well was because they know it cost me they know I'm losing money. Like people can they know that three hardbacks cost more than $15. Like they know that. And so shipped, right? Like even one $15 is a crazy deal. Three is absurd, right?

13:28And so they know that. And so it's like people assume that like I think Olgie said this. He said people think they're you know the the prospect is an idiot but she's your wife. And it's like we we we talk to these amorphous masses, but it's like they're real people who are intelligent, who can make decisions and they know when something smells off and they know when something is a good deal. And so like you can only do so much dressing up with the copy and the words and the persuasive elements because at the end of the day, you should be able to make the pitch by just stating the offer and shutting the [ __ ] up and pointing to how to pay and people should buy. The rest of it is just is dressing, right? It's just tweaks. It's just improvements. But the biggest improvement overall is going to be what the thing you sell is. So sometimes we need to be reminded more than we need to be taught. And this year was a a wonderful reminder for me of like So Craig, welcome.

14:24>> Alex, >> what's up, dude? $18,000. $18,000 a month, right? That's where we're at. >> 18K per month. Ad spend is zero. Okay, got it. Industry is digital services. >> Got it. Yes. Yeah. >> And you're selling to e-commerce? >> Yes, we are. Um >> Okay. >> To e-commerce brands trying to um so basically business is about a year old.

14:48Um and we've got like my best friend is a really good web developer. We joined forces uh started like using his network to get clients. So we've done around $25,000 in the last uh 12 months. We're proud to say we've never had a client churn, but we're kind of like a glorified tech support department. So, basically anyone with a credit card and a pulse. >> What's price point?

15:12>> Price point? Um, we're basically billing early at the moment. I'm putting together like an offer funnel and everything. So, don't do that. >> Yeah, it's like Okay, so what are you what are you billing right now on average? >> Um, like £50 an hour, say. So, like $70 or so. Um, >> right. It's just you and >> I'm trying to >> uh with one other full-time developer, a few freelancers and everything. So, we do offer like, you know, we do SEO, we do good web web development, PPC, um, some CRO stuff. It's kind of like we need to really rein in on our ideal avatar. I kind of I feel a bit silly because you've already shown me what to do. Um, I need to go move mountains, get a ton of leads, um, get them get our ideal avatar. But, um,

15:56>> well, you do need to change your offer. >> I have the opportunity to speak to you. though. >> You do need to change the offer. >> Yeah. Yeah. >> The offer sucks >> for sure. >> We We need an offer. >> We don't. >> You're selling to people who are doing 30 to 100,000 a month, right? >> Uh yeah. Well, that that's the target audience. Some are a bit smaller, but yeah. >> Well, whatever. I mean, I don't know if you just heard I had uh who did I have on earlier? I had um Liz. I think Liz is doing $600,000 a month doing many chat automation and she's selling to e-commerce owners doing $25,000 a month

16:27>> and she's selling 6K a month, >> right? Yeah. >> You're selling like >> Yeah. Yeah. >> $100 a month. [laughter] >> Yeah. Under underpriced is uh you're wildly underpriced, but we have to tweak the offer and the pricing together. So, I would want to say like can we say like uh we'll get we you know we'll we'll replace 10% or 20% of your traffic with SEO within a year. Um, and our services are, I don't know, starter $2,500, $3,500 a month just to like get going.

16:54>> Yeah. Yeah. I I have an offer. I'm starting to pitch on cold outreach if I can run that by you. >> Okay. >> Uh, yeah. So, I mean, basically SEO industry is like really commoditized by retainers. So, I'm trying to just ramp up cold outreach and basically offer people like a free personalized audit as a lead lead magnet. So, I'll show them where their competitors are ranking, where they're ranking, and what they're missing out on. >> Give them a personalized loom, sort of showing them uh where how to improve.

17:21And then we're we're going to do like a 28 day sprint to basically fully optimize the website as much as we can. Try and get them as many wins as we can in the first 28 days. >> I wouldn't use the word audit. >> The guarantee. >> Yeah, I wouldn't use the word audit because I think that sounds boring and not fun. So, I would say like look at like we will find you at least seven revenue opportunities >> that you can set up within the next 30 days for free. >> Gotcha. Okay. >> And then you walk them through it. >> Yeah. Way better. And you walk them through it. You say, "Hey, you can do this on your own. Turn it over to, you know, a web company or we'll do it for you."

17:54>> Gotcha. Um and I was thinking like a in terms of like a guarantee, I was thinking maybe like we refund sort of 25% of our cost, like our profit margin, something like that. Yeah, that's fine. >> Yeah, it's I'm trying to make it more compelling, but it's um I think SEO is a tricky industry to to sell right now. >> Yeah. I mean, the thing is it takes time for SEO to work.

18:18>> Yeah. Well, I mean, we we can do a lot in in like four weeks and and just show them like initial wins and trying because I'm trying to build the trust because, you know, everyone's got a million SEO guys in their in their inbox just like, "Hey, you know, >> can you can you do uh yeah, Herd, can you do can you like guarantee around rankings like we'll get you in the top 10 or the first page or something?" >> It is tricky because it's like we could do everything right, Google changes their algorithm and and you know, their their site goes down. So, I try and pitch it as like we're going to stack the odds in your favor, but yeah, it's it's hard to guarantee results. I guess we could guarantee page speed, but I mean that's not really the be all end all of a business.

18:56>> No. Can you do anything around just traffic, not necessarily ranks? >> Uh, I mean, potentially. Um, >> yeah. I mean, I like the seven revenue. Like, if I'm just keeping it simple, I think seven revenue opportunities. We're going to unlock these things. this is our price. You don't have to worry about guarantee or anything like that for now. >> Gotcha. Okay. So, so just like one time one time kind of lead magnet. Here you go. Uh and hopefully from there book a call maybe go into like the sprint.

19:28>> Yeah. I mean I would say like here's what it is. We can implement this in your business. Do you want to implement in your business? Great. And so if you want have you read the money models book? >> Yeah. Yeah. Yeah. >> Yeah. I would use a wave fee offer for you. >> Okay. So for everyone who's watching online, I'll I'll on this. So wave fee offer is the last offer I think in the continuity section. >> And so when you have a business that like takes time for someone to get started, you do an AB and you say, "Hey, um option one, uh you keep flexibility, right?" And so you say, "Hey, it's, you know, $25,000 and then it's $5,000 a month after that." Or I'll wave the 25 and it's $5,000 a month. But you got to stick for a year because it takes time for the SEO to work. And the good news is that if we haven't made progress within the 90 days, you can get out.

20:18>> That that would be my like second out door. >> Cool. Like that way it's like you don't feel like you're like but in 90 days if we haven't >> like you know what what to insert here but if we have an X within 90 days then we'll let you out of the contract. So instead of the guarant the guarantee is that we can let you out of the contract >> without having to pay the wave fee exit. >> But if we hit our thing Yeah. then you got to pay that to get out because that would have been the flexibility price. Okay, gotcha. That that makes a lot of sense. I appreciate it. Yeah.

20:45>> Okay. >> Um, cool. All right. Um, and just to take a second, I just I always thought if we ever spoke, I just want to thank you for for everything that you and Tre Trevor have done into drilling everything down into a way that we can all understand because uh yeah, when it when it's like when I'm overwhelmed and I'm overthinking, it really helps so much to to be reminded it's input output equation at the end of the day. >> Well, I'm happy to hear it, man. >> Yeah. Thank you, man. You're awesome. >> All right. All you. >> All right. >> All right. All right, see it for everyone online talking about page 153 inside the off and not offer, excuse me, money models book. All right, so this is the last part of the continuity offers.

21:18That's the wave fee structure I was just talking about. Okay. Could you please explain how to decide between a monthly Oh [ __ ] you a monthly subscription and what was it? >> I missed it. >> And a onetime payment. Yeah. Yeah. Okay, cool. Um, it's actually just a math thing. So, it's going to ladder up to something called EPC's, which is earnings per click. All right? And so, you get your earnings per click by saying you have two lines on an Excel sheet. So, this is pure math. 100 clicks to offer one, 100 clicks to offer two. And so, if offer one gets 100 clicks, and let's say you convert 2% of those clicks. All right.

21:58I'll just do the math in front of you. >> You love when you do math. >> Yeah. All right. Right. I'll be fast with it. All right. So, we get 100 clicks on both of these. We've got A, which is our subscription, and we've got B, which is our lifetime. Okay. So, let's say our conversion rate on this is 2% here. And let's say our conversion rate on our lifetime offer is 3%. On the page, whatever. All right. Now, our price for our subscription is going to be, let's say, $10 per month. And let's say that our lifetime offer is $50 uh one time. All right, that's it. Now, our churn.

22:37All right, our churn here, let's say that our churn on this is 10%. Okay, that means our LTV is going to be $100. So, if we have two clicks, 2%, two clicks, and we have 100 LTV, then we're going to make $200 in total on 100 clicks, which means our EPC is $2. If we're going through this one, our churn doesn't matter because it's lifetime. lifetime value is going to be $50. And so we got three clicks, which means we got $150.

23:09So our EPC here is going to be 100 divid uh 150 divided by 100, which is I don't know, one and a half, I think. So this would be our winner. All right. Now, the big caveat here is that it will take you 10 months to break even on that first offer versus getting five times the cash up front. So, there's going to be a cash conversion cycle issue um that you're going to have to deal with. Now, these numbers actually don't make sense because realistically, you might have higher conversion at a $10 price point than 50. Then again, people don't like monthly recurring compared to a onetime payment. It could be it could go either way. And so, if you're like, how do I pick which one? You test both. You look at your earnings per click. The one that has the earnings per click that's higher is going to be the one that will make you the more money over time. And as long as you have the cash flow to sustain that, that's the one you do. If you don't have the cash to sustain it, then you have to start re-riggering the money model. Read the green book. That's what it was all about.

24:05>> Boom. >> Snapshot that. >> That's right. Own a exhaust hood cleaning business in San Diego. So, we sell like >> exhaustive >> exhaust hood cleaning. >> Exhaust hood cleaning. Got it. >> So, we do like grease removal from ducks, fans, hoods um in restaurants in San Diego. >> Cool. >> Where we're at right now, just hit month six. Um >> is that like 18 wheelers like semis that you do that on? >> What is that? We just have like a van with a hot water pressure washer and chemical >> roll in the restaurants.

24:32>> Guy with water and truck. Okay. Oh, so restaurants that Okay, got it. Understand. So like in all the restaurants there's a hood system above where they cook grease in there. It's like a fire hazard. So everyone has to legally do it. Um >> it's a great business. I I >> it was described to me differently in a different setting. So yeah, it's a cool business. Very >> That's why I kind of explained or else people are like, "What the hell are you talking about?" So uh we just hit month six. We're doing like 6K a month right now. Okay.

24:57>> But we have people on it's a subscription based business. So, um our book right now for like yearly recurring revenue is like right around 100K. >> Cool. >> Um I think what's stopping us right now is just like not a clear offer, >> right? >> Because I deal with restaurant owners who only care about their bottom line. It's like a money thing. They're like >> most business owners. >> Yeah, true. And they're like, "Well, if you can give me a better price, I'll give you a shot." And right now I'm just like the hungry kid that's like, "Yeah, I'll beat your price easy." Right. So I think what's stopping us is

25:26>> figuring out pricing and offer with a service that more or less is the same no matter who you go with. But we have added value adders with like customer portal streamlining backend support things like that if that makes sense. >> So you say that to the business owner.

25:52say that to the business owner. How so? You mean >> there's good, fast, and cheap. >> Pick two. >> And so the problem is you can have somebody else who can do this. Like to your point like you started with the premise that this is a commoditized service. I would just break I would just erase that from your memory because at the end of the day like you have to believe you have to believe before anybody else that it's not a commoditized service. And so I would say what are all the reasons that somebody who sucks at this sucks?

26:19>> And let's fix all of those things. And so what's really interesting about good, like what does good even mean, right? So good is basically the absence of hard, [laughter] right? And so I think about this when I'm creating a product or service and this has actually been really helpful for me in terms of like how you operationalize value in terms of quality is you think what are all the things that suck about the existing services? What are what what makes it hard? And so a lot of people use the term friction, right? And so something that is easy, you can't make something easy, you can only make it not hard. Mhm.

26:51>> Right. Like if I said make it easy, it's like when something's easy, all the hard vanishes and all that's left is the outcome, right? And so if we want to make our products or services easier, which then means more valuable, we have to remove all of the elements that make it sucky. >> And so if we're thinking about the competition that you're competing against, like maybe a lot of them are, you know, not that personable. They maybe terrible service. Maybe they don't do a complete job. Maybe they're not willing to come back if something happens. Um like is there um like what risks does the restaurant incur if it's a shoddy job? Is there a cadence that they have to like maybe we can treat it in a way that allows us to come half as frequently? So, we're more per uh more per cleaning, but uh they they don't have to pay it as often, right? So, we have higher gross margins and that actually works fine for us and it's less for them. Like, you know where I'm going with this?

27:38>> Yeah. Yeah. And then and then from a from an economies of scale perspective, it's like how can we incre Now now you're super early on this, but like over time it'll be how can we increase route density um so that like we don't waste as much time and so we get more efficient with the routes um and we can ultimately make more than our competitors or at least increase our gross margins even we keep our price fixed. >> Right. No, that makes sense. One more question. So everybody has to get done at least twice a year. So we're signing people a year agreement anywhere from twice a year. Some people do quarterly.

28:04Some people do like three times a year. So based on what you just said, would you recommend potentially going more towards just pushing semianually but keeping price higher so that they feel like they're paying less over the years? >> Yeah, I would look at my gross march. I mean, real real, I'd rather sell someone more. Yeah. >> Start at four, downell to two, u if you can, and then probably play with payment terms, which is like, can I stack more of that cash up front, right? >> Versus getting paid quarterly, you know, >> pay in full up front.

28:32>> Yeah. >> Okay. But big picture, I mean, we I like if I'm you, I'm putting all my effort into trying to figure out how to decommoditize my service. >> Um >> because it is probably the most important thing. >> Otherwise, you're right. You will just consistently be dealing with if you are the same to the customer, it's the first chapter of offers, right? Like if you're the same thing to the customer, these two things are about the same. I'll buy the cheaper one. It's the worst comparison. It's not the fight you want to fight. Mhm.

28:58>> So it's like I put all my effort whenever I start any business or any product line into like why is this different? >> Like that's my full like I don't even think about pricing. I don't think about anything until I answer that question. >> And I have to at least be able to articulate it to them really simply which is like here's the five things that happen that suck. >> Here's how we don't have any of those five. >> Mhm. >> And for that in exchange instead of paying this you pay this but this is why it's worth it.

29:22>> Right. And then in that our only form of outbound right now is just like door knocking restaurants and then cold email. So then building that offer out with the de decommoditized if that's even freaking word >> and then put that into the offers, the emails, >> the text, the cold outreach basically and just sell the [ __ ] out of that. >> Sell the [ __ ] out of it. >> Heck yeah. [laughter] >> Thanks, dude. >> Do you add a credit card processing fee for every Okay, good. You're doing that.

29:50Are you billing every four weeks? That's no >> do that now. So that'll add 8% to your revenue. It'll drop straight down. Have you read Gym Secrets? >> Uh no, I have >> Dude, read the book. >> It's about gyms. [laughter] >> It's literally about your business. >> You love gyms? Really? >> Yeah. Like uh so there's a price increase letter that's in there. You can literally copy the letter and send it to your members of how you do it. But you want to do like two or three pricing changes all at once in that one letter so you can just like in one fell swoop just knock out. Exactly. Like, and so when you make the change, just say, um, "Hey guys, effective today we're changing the pricing, but since you've been such loyal members, we're going to grandfather you for 6 months." And they're like, "Oh, that's all." But you're still going to just bump them in 6 months, but that way they feel better about it.

30:30>> You give it enough time to >> Yeah. And dude, all the changes, the thing is they don't even The thing is is if you're going to do that, it's like you want to also add other [ __ ] because going from monthly to every four weeks, no one even cares. >> It's nothing. >> Yeah. >> Doesn't even matter. So do the the four weeks one. you can consider putting in an annual renewal fee which is usually you want it to be equal to like 1 to two months. So think like 99 to 199 as annual renewal which just so it's like you have initiation fee it's just every year there's also a $200 fee that adds on it sounds like nothing but it's another 16%. And if in your business that you know you're running 20% margins it's like well we added eight we added another 16 we added 24 we just doubled profit with two pricing changes we had the 4% from the processing fee thing.

31:12The key with the processing play is you don't want the 4%. If you get it, fine. What you really want is the second form of payment. And so you say, "Hey, it's 200 bucks a month or whatever, 100 bucks a month, uh, plus a 4% processing fee." And they're like, and they always like, "No one no one doesn't close because of it." You've already seen that. But then you say, "Oh, uh, if you want, I can wave that for you." And then they're like, "Oh, yeah, that'd be great." Like, "Well, just give me a second form of payment. We only have the processing fee because if we have to go chase after you, just cost us resources." But the thing is is that getting the second form of payment can decrease churn by 30%.

31:45And so if you can decrease churn by 30% that's worth way more than 3% more on topline. You does that make sense? >> You mean an alternative source of credit other than a credit card >> or a second credit card. >> Give me two cards. Exactly. Just go to the second one. >> Yeah. Now the 2011 play of that is you get AC. So automated clearing house. You know that right. And so a does a double whammy for you because one, you save 2% on the fee because a is cheaper. But on top of that, you also now have a second form of payment. So you reduce the churn and you get the decrease in payment processing. You get both. Again, this stuff doesn't sound like much, but when you add 2% 5% times like six different moves, all of a sudden you go from a 20 to a 50% margin. But when you throw in that annual renewal fee,

32:30>> so in the letter, it's basically section one is what we already do for you right now. That's amazing. And that you remind them of the value. The second is what I'm going to do with all the money that I'm I'm not a greedy bastard is section two. I'm actually going to be in reinvesting in training, getting more equipment, blah blah blah blah blah. And in a gym, it's so ob like it's so easy to be like this equipment is not cheap and you pay 100 bucks. Each one of these pieces is 10 grand, right? Like cost a lot of those >> paint on the walls, >> right? Yeah. All this stuff, right? And so uh this is what we're going to And then you soften the blow at the end with the but don't worry, we're going to grandfather you in for the next 6 months. You'll get all the benefits and then you're going to and then we'll bump you up. And if it feels like it's a big bump, you can do it in two phase. You be like in 3 months and the I just wrote a whole thing on this so it's top of mind.

33:10But basically, you want to say um I'm going to give you let's say the difference was um 200 bucks is the total difference over 6 months between what they are paying what they should be paying. And you say, "Okay, I'm also I'm going to give you a $200 credit to the gym." And uh and then when you send them the thing, they can see the credit being applied. And so people are way more willing to let a discount disappear than a price go up. And so you say the price goes up, but don't worry, I'm going to give you this discount. And so then the discount is what dis disappears rather than the price going up. So it sounds minuscule, but it's actually way softer.

33:43>> Psychology, man. >> We're on like bill. >> Yeah. >> With people. Um, basically they agree on the price, but a lot of the times like they can't afford the first payment or they can't get approved for financing. And I'm like, is that a sales problem or is it like a a lead problem? And should we just collect whatever cash they have or no? Like, >> well, how are they going to afford to pay for the marketing, too, if they can't pay for or is that what you're saying? They can't they can't afford to pay for the marketing?

34:13>> Yeah. So, they can't afford to pay for the marketing. >> What's the revenue stick? What's the stick in this business? Like how long like do people stay for years, you know, doing this with you? Like what percentage of customers are are here 12 months later? >> No, it's mostly not that they're here 12 months later. It's like the onboarding. So the LTB is roughly like 35,000. [clears throat] Okay. >> In like 90 days,

34:35>> but over time like the only thing they really stay for is like the CR that they use it. >> Okay. So you white lab go high level or something. >> Yeah. Right. Okay. Okay. So, the issue is that like what's your LTV to CAC right now?

34:53>> So, right now our CAC is roughly like 5,000 but we're we're um at 35 like 35,000ish LTV. >> Okay. So, you're 7 to1. Okay. >> So, I mean that inherently is okay. Um so, what stops you from doing more of what you're doing? Um, nothing's necessarily bothering me.

35:19Our close rate is just super low. >> Okay. I mean, I would probably just throw in lead qualifications on the front end. It'll just like decrease the frustration of your team. You'll probably increase your Well, obviously you increase your close rates if you take out the the disqualifies, but it'll you'll close more in general because the sales team won't be beat down from hearing no all day. >> Okay? >> I'll tell you this, man. You will make significantly more money by adding qualifications to a funnel. Like I almost like I have almost never like I'm trying to think of a time where me adding qualification friction made me less money. Your your metrics will change. So like your so not CAC and LTV but your I mean LTV might change but said differently like your cost per call or cost per click or cost you know whatever metric you use there uh will probably go up but your CAC may go down and your LTV will certainly go up.

36:12Okay. >> I would just add more qualifications in the process and then do more. >> So I guess that is I guess that's a fear of mine would be for the for the appointment to go up like cost for appointment to go up but basically it should make it more profitable because we're not talking to unqualified people. Correct. >> Yes. Because listen, if you let if you let some of these minnows in, right, it's not a good fit for them. It's putting it's their last dollar. Like you should not like you shouldn't do it ethically anyways. But B like outside of ethics because that won't that never convinces anyone if they're making money. Um it's not good for the business. It's bad for the sales team.

36:49It's bad for reputation. And fundamentally like when you accept everyone, you ward off people who can actually afford stuff. >> Yeah. Yeah. >> And like I guess through the so we like like you say with like you're big on [ __ ] >> So we do provide like a really in-depth training guide like really in depth. But uh the issue there the majority of people who come in are not qualified at all. So should I add more qualifications to that too? [sighs]

37:18>> So you can add qual what is the lead magnet again? >> The lead magnet is a training like it's like all of our SOPs like all of our SOPs all like basically for our entire company. You can you I mean you can have the SAPs there whatever just put add an extra box that says like whatever the qualifications are that are that you know are required for somebody to be a good customer. So like for example at the book launch people could opt in to show up to the launch. The launch functionally acted as a as a lead magnet in this scenario. I still ask for people whether they owned a business and if they had a business, what revenue level they were at because I have no need for, you know, leads in a CRM who are not business owners above a certain size to get a call from my team. There's no point. It's a waste of their time. It's a waste of ours, right? They should just use all my free stuff. And so, just add a qualifier on the on on the front end,

38:10>> okay? and then only call those leads and then have the thank you page sort uh leads uh the best leads to the the sales team and then the worst lead just you know send them to an automated thing that maybe selfquidate some of the ad spend. >> Okay. So like on the qualification question yeah >> would you put like something vague like we have right now we have a qualification question like are you willing to invest in your >> No that's not a qualification question dude that's that's a like do you have a pulse and a credit card question. I'm saying you have to,

38:40>> right? You need to figure out who your avatar is. >> Okay. >> Have you read the Lost Chapters book? >> Okay. >> So, the Lost Chapters book. No, I haven't read that one. >> First chapter of the Lost Chapters book is finding your avatar, your first avatar. All right. The process that it walks through that in in the book in that first chapter is you need to look at the customers who have spent the most with you and stayed the longest. What are their characteristics? So, we look at their demographics like who are they, right? We looked at their quantifiables like do they have a certain income level? Do they have a certain amount of kids? Do they have a certain family? Uh and then I look at geographic. Do they live in a certain area? Right? And so when I have those three things put together then I know that it's like okay it's actually conservative Christian males uh you know 35 plus uh who are married is actually my best avatar. It's like great. So that's what we're going to make in our ads. And your big fear right now is if I make more qualifications my cost is going to go up. But it's not, dude, because you're gonna need to advertise to the right type of customer and you'll get those people to opt in and then you will go b get them to buy more expensive stuff.

39:45>> Okay? >> It's everyone's fear. Everyone's fear is going from general to specific. But when you go specific, you get the right people. >> Okay? So actionable steps are just like the qualification questions and making it specific to the avatar. >> So in order it will be determine the avatar by looking at all the customers that you have. If you want to look at who they are, what quantifiables they have, geographics, and if you can, bonus points for sales process. Did they consume anything else in the sales process? They have a different experience than the people uh who didn't who aren't worth as much. Right? Once we have that data, we then weave that into the advertising in terms of callouts of who the avatar is. We weave that into the landing pages. Weave that into the the the drop downs for the questions and the friction that we add in the funnel.

40:28We add that into the VSSLs. If you have a VSSL, I'm sure you do. um that that tells them about the process and it begins with the pains and the hook of that specific avatar. You do all that stuff, you will for sure convert more. >> Okay, >> cool. >> Thank you, brother. >> You bet, man. Have a good one, dude. >> You as well. >> All right, rock and roll. So, top line, bottom line, and then like do you need do you can you handle more customers or uh or do you need more capacity?

40:55>> Uh both. Okay, I'll give you a quick >> It's got to be one or the other. Don't do No. Oh, give give me the answers. Top line, bottom line. >> Yes. 25 and 20 right now a month. >> Monthly. Okay. >> So, you got good profit. Okay. Great. >> Yeah. >> Okay. Understood. >> And uh right now I'm a little stuck. Okay. >> Because everyone puts my offer >> and I think that I can't handle capacity. So, I'm trying to

41:21>> Before you Before you tell me anything else, just so the audience knows, what is your business? >> Yeah. Yeah. What do you do? Yes. So, what I do I'm from Ukraine, so I Yes. I had an agency before, didn't like it. ThreeK months didn't work um really well. I started coaching people on how to create content that converts. >> Okay. >> And it was not really awesome because nobody has time to create content. So now I train people in Ukraine on how to create content that converts.

41:52>> You're you're talking to a man who's who's seven hours into his making content. But yeah, I hear you. Okay. >> [laughter] >> Yes. Yes. True, true, true, true. >> So, right now what I do, I train them on how to do scripting, writing, editing, design, all of that. And I place a Ukrainian content partner in a business in Canada, US, Australia, and Europe. And it only cost a business 500 a month to have a person full-time on their team.

42:19>> I charge 5K >> a month or one time. >> A month or one time? >> One time right now, but your AI told me I should do 12. So, um, >> sounds like something. Sounds like something I would say. >> Um, so, >> exactly. >> Yeah. So, it's So, I I'm gonna So, I still have utility. I still got a couple I still got a couple tricks up my sleeve. Yeah. Hasn't learned from me yet. Uh, I'll tell you this. It's a blend of the two. So, I want you to charge more upfront, but I want you to own the relationship.

42:50So, I want you to charge $1,000 a month on the back end and pay 500. you make $500 a month on continuity on the back and charge a onetime setup fee. >> Mhm. >> So, I think I think um because you're going to have the backend piece, I would go 6K upfront and then I charge a th000 a month on the back. >> Okay. Is there a specific audience would you go for? I'm doing online coaches and service providers right now.

43:17>> I mean, I think you can start in a niche. That's fine. There's plenty of those. >> Okay. I think what you'll find is this is that >> you'll want to go up market in terms of like you just you just want to make sure you're finding people who already like have a business that's working. You don't want to be in the business of like oh if you made content then you'll get leads and you'll make money. You want to be in the business of like you already are making some this will help me make more um rather than the zero to one. Does that make sense? >> Yes. Cool.

43:43>> Yes, that makes sense. Um and so one thing that I'm struggling is awareness of the offer. People don't know what it is. They think that I place editors. Um, and maybe that's because of my positioning. Right now, I just say I have like content partner academy and they're like, "What is that? Is it like editor?" Whatever. Um, so some people said that I'm a recruiter and I'm like, "Am I?" >> Yeah. >> Like what would you frame that in a in the ads? Like what is the best way to get leads through ads? Because I'm spending right now, but it's not really converting.

44:11>> Uhhuh. Uhhuh. So, how would I how would I describe what you do in a sexy way? Um, well, knowing the way that I advertise, I would say I will hire, train, and place somebody to put content out on your behalf one time, and if they don't work out, I will continue to replace them until they do.

44:34>> That would probably be my ad copy. >> Like, and then like here's 20 companies or 20, you know, 20 business owners who used exactly that that are like Darina's awesome. That would be my entire >> Yeah. >> That would be my secret. >> Yeah. >> Ju whenever you're not sure whenever you're not sure what to say, this goes for everybody. >> Just describe it in the simplest terms possible. What will you do? I will hire, recruit, and train an editor and I will place them in your business and I will manage them for you.

45:06>> Yeah. Yeah, that makes sense. That makes sense. >> And if you don't like it, I'll replace them. >> Yeah, that that's kind of part of my offer right now. But everyone liking their people so far. So that's kind of awesome. >> Uh so I have a bunch of case studies testimonials. What I found works really well for me. I I'm a part of different communities like coaching communities and I partner up with them. Yeah. And I said, "Hey, listen. If I close your personal, I'll send you thousand cash

45:32>> and I closed a lot of people just like that." >> Um would you recommend kind of going that direction or doing maybe cold emails like how to get more people at scale? like ask more leads. >> I think you just keep finding community owners who what what is this? What are you doing? Sorry. They they just like put put a normal background. No, I know. Put a normal background. No, no one wants to see this. Come on. This is wildly distracting. Okay. Um I think you I want you to do cold outreach into affiliates. Okay. So, your core four is cold outreach and but your your primary channel is going to be a lead getter. So somebody already has the basic customers and what you need to establish is a cadence of promotion. So what that means is you need to promote with them and say, "Hey, this is going to be our schedule. So I'll promote twice a year inside of your community." And so you can expect like each time we do it, you're going to have new customers in there and some old people who got results. And then you keep track of which customers from the last time you did. And then only parade the results from the people who were in that group to that group. It'll it'll convert like crazy because it's literally the most relevant um

46:38>> uh testimonials. Does that make sense? >> Uh I think so. How do I find that there? >> Well, you you already have girl. How many how many coach creator group do there's there's so many >> unlimited? Yeah, >> there's so many. Just so many. So many. >> Okay. So, just reach out to them and connect with them. Yeah, >> but you're going to need two levels of testimonials here. Okay, so level one of testimonials is group and community owners who have that avatar that you'll then say, "Hey, look at this other group community owner. He made $50,000 cuz I got 50 clients with him doing this thing so we can partner on it. I'll give you, you know, whatever." And they got thousand bucks to sign up. Okay, so that's the level of testimonials that you're going to give to get them to sign up for a performance partnership. Then for each of their customers, you're going to get them to sign up for your main thing, you know, showing actually doing the the work, right?

47:31>> Yeah. >> Okay, cool. >> Okay. Yeah, that makes sense. Okay. Very quick question. >> It's always a quick question. >> All right. Go ahead. >> I know. I know. >> Go ahead. You're good. Go ahead. >> Um, so on the back end though, right now I have uh three team members. I have an appointment setter. Um I have I don't have a salesperson yet. Um what would you recommend on a backhand to do? I do believe in this and I think I can do one million. I just need to do more work and put a lot of work. Let's just say that.

48:03Um what would you recommend to do and from the playbooks that we have in community where would you recommend to look at like where do I need to go deep to learn more right now to really scale this fast and what do I need to tap into? Can you handle more customers >> uh with the automations that I'm planning to implement this month? Yes, a lot more. >> Okay, so step one, complete your automations. Step two, >> yeah,

48:30>> figure out how many more customers you can handle. Step three, >> y >> I would search I would search the you know, search the school community. There's literally discovery like search school community. You can look at all the communities that are there. Search on all the platforms. Look at Reddit, look at Facebook, look at all the different communities that exist. and then outreach to those business owners or you know they are you know community owners and then give them a testimonial, show them or try and hop on the phone if you can um of somebody who's just like them who got a great result and then you want to tell them how you can do it with them and if you reach out to a lot of them you will get some of them to respond. Now some of them because you're probably in that world and the world isn't that big um you can probably get mutual or warm intros that will be significantly more effective. So, you reach out to somebody you know who knows that person. You say, "Hey, do you think you could make a three-way introduction and you can give them a slice of it as well because you don't really care about the upfront because you want the recurring."

49:20>> Cool. >> Yeah, that makes sense. >> That's that's easy as one, two, three. Door me. >> Yeah. >> And then volume, baby. >> Volume. And then don't get fancy. >> What do you mean by don't get fancy? >> Don't Don't change your mind again. on like an offer. You mean like >> Exactly. Just stick with stick with what you're doing. >> Yeah. Okay. Yeah. I really believe in this. Yeah. Thank you. And happy birthday. And along

49:49>> Thank I appreciate it, Darita. All right. We'll talk to you soon. >> Hey, >> what's up, dude? Oc. >> Yeah, that's uh that's my business. >> 18 million top line. Congratulations, dude. Stud status. Okay. 1.5 million bottom line. Heard. We got five minutes. What's your What's the constraint? What can I help you with? Sure. >> So, brief context. Uh we do employment medical evaluations. Mostly we're selling to large companies or uh large employers, cities, counties, defense contractor agencies, those types of of companies.

50:24>> Um our best client is going to be someone who's geographically dispersed because we manage network medical providers all throughout the country and then in about 50 other countries as well. Um, and so it's kind of our target audience. Um, it's a fairly cost competitive area. We mostly get clients through competitive RFPs, occasionally through word of mouth. We're currently doing next to no advertising or marketing. We basically grow through word of mouth or the occasional trade show and the RFP process.

50:54>> Um, I I think one of the challenges is two challenges. One, um, I think we need a money model, an improved money model. And so I'm excited to get my hands on this book and work through some of that. Um, and something that can bring clients in a little bit more easily and then over time, you know, increase the the ticket price because right now it's a, you know, we're perceived as a commodity in lots of instances, but how we operate is very different. Uh, we have really good customer retention like 95% plus.

51:25Um and so you know if we can service them in any form or fashion then we typically can can keep that going for you know years or decades >> um so aside from money model the other thing that I think we could use is better awareness. I think I don't know if people outside of our specific niche in defense contracting know who we are >> heard. Yeah. And so I I'm looking at potentially getting into some sort of um you know uh uh content creation of some sort.

51:56>> Yeah, exactly. Um probably LinkedIn >> being as B2B um is our >> you know business. So >> um >> no experience in that whatsoever. Don't post content at all and uh I'm on with the experts. So >> So you got you brought up three different things. So I want to like let's just take them one at a time. So one, there's the like I want to basically increase the brand so I have you know more pricing power and more inbound inbound deal flow. That's number one, right? Uh I'm doing this in reverse order because I'm just rewinding what you said. Uh the next thing is that you need pricing power. So you are selling commoditized you know good and so it's like how can we create more pricing power? So brand is one element of that and the other is just the value itself, right? And so um I don't know if you've been on this live stream that long but the problem that you're having is a super common one. Um and basically we need to pick one angle so that you can decommoditize and so uh Shrod and I were talking about this yesterday for different business but it's like you have the price and then you have you have sorry you have the service and then you have the consideration right and so we only have commoditization and I know you have to respond to an RFP but there's still the benefits that you can uh throw in on top that make your service different because you can still win in RFPs without it being lowest So, do you think you can win on speed?

53:16Do you think you can win on ease? Or do you think you can win on risk more than anybody else? >> Yeah, I think we do particularly well um on risk and speed. >> Okay. So then basically again I I I I sound like a broken record with this particular thing um because I just it you want to get stats to demonstrate the cost on a global level. And so the big thing is that you want to approach their business from a holistic perspective rather than try to win on a component of the business. And so when you can look at the whole system, you can start pricing against value, which is what they are ultimately deducing from the RFP, but they limit the scope because they think that by doing that, they're going to get the most competitive bids.

54:03But you just need to have a better understanding of the business overall to understand the other levers so that you can reframe the pricing so that you can decommodicize against the other uh bids. >> Yeah. So, I think what I'm having you say is like the proof of how we save the money through other things that aren't our price um but that they're spending money on, they're just not captured in the fees that we charge. >> Can I give you a hack, >> please?

54:26>> At the end of your RFP, put one to three case studies or ideally the case study that is most similar to the client that you were, you know, that you're bidding for and then have that client do the sale for you. Like even though they weren't the cheapest, boy did they save me the most money. And this is how they did it. Speed and risk. You know what I mean? And then they they they hit on the buttons that you hardcore focus on within the RFP.

54:56>> Awesome. >> Yeah. So you'll win more bids just by throwing that in. What's crazy is that so like no one does that. >> Correct. [laughter] >> It's like no one does it. >> Yeah. >> Do you want to throw someone in tr? >> Yeah. I have one idea. U by the way the case study closes. Whenever you think RFP think case study close that is the because everyone reads the RSP and all the folks in the RFP mode are in instantly and I commoditize like I'm looking for the price mode but once they see that and they also see the case study then the if the delta is not that much you get you get the win. The second thing I I don't know if you can do this Andy which is um is there any way to to include a provision in the RFPs which we've suggested in the past where uh any new services that you can probably do consulting for that you would automatically charge those at a 25% discount and all that it means is that you're opening the door for consulting onetime consulting opportunities that you can do during the term of the RP RFP and they're like oh mash you know Alex is such a good guy even though he's not only giving us his RP if he chooses do onetime consulting within this, we can also get a 25% off. So sometimes what I found there is once you get you can still get a one-time kind of consulting job which you can then turn into adding to some recurring revenue after. Is there maybe that's an idea.

56:05>> Okay. >> Also depending on the size of the business, you probably seen this before, but it's significantly harder to get approval to get the bids sorry to get the money flowing. But once the money spigot is turned on, it's much easier to adjust scope and get an increase in budget than it is to get the budget turned on to begin with, which is what what Sean's doing with kind of like you you have your RFP thing one, which is what everyone's doing. But then you add in the case study piece, which is thing two, which differentiates a little bit more and then basically resells the primary uh sales points of the RFP, but then in addition addition to that, you're saying, "Hey, don't worry about it. I also have this uh you know, one-off consulting. So if you do find someone cheaper, I can help you bridge the gap, but now your foot's in the door and then you can cross other services, but now you already have a rider there.

56:43And so they can start jack, you can start basically inserting yourself in these other process. Again, this depends on the size of the business and how the procurement process works. >> Yeah. >> And if you're curious, anybody who's watching like why I have any knowledge of this, the first thing I had out of college was um I did space cyber intelligence for um a boutique strategy firm and we all did was uh was u public sector uh contracts. So the RFP world I told you I have this very odd mix of >> but I think the way to think about I think you nailed it. The way to think about it is every time you're selling something to a client if you're in a sales process your you if you should be thinking about it from a value frame as to what what can I hit and you should be thinking about from an RFP frame on the floor. Yeah.

57:19>> Um every sales process people are always like well what is my USB? No they're thinking about it you when people walking in they're saying some are RFP minded buyers. So you have to have the RFP frame on the bottom which whenever you think RFP frame think case study close and then when you have the value frame you can say hey here's all this other thing I can do for you. So if you just approach any sales conversation as a synthetic RFP conversation your chances of winning go up significantly. Yeah, it's like the frame that and like I think giving great examples of this of like when we want to set the frame for the entire conversation like the first paragraph of an RFP obviously you have the pieces that are required but I want to set the frame as early as possible on this so that I can say like this is how we approach these things like if someone were to say hey get me the cheapest leads you don't actually want the cheapest leads you want the highest ratio of dollars in to dollars out from customers which might not and very likely will be not the cheapest leads but the best leads that convert at the highest% percentage at the highest prices, right? And so again, it's like we have to have some very simple analogy that we can reframe and decommoditize ourselves. So it's like listen, you want the best return, not the lowest price.

58:24>> Yeah, >> understood. Hey, one question about the um case studies close. >> Yeah. Yeah. >> Is it effective if I can't disclose the customer like they won't actually do the talking for me and and I have to anonymize it because our use of it? >> Yeah, it's fine. >> Yeah. Uh and you also whitewash it too. Yeah, you can whitewash it and the way to do that is to provide as many meta detail details as possible of about that customer. So like for example, if you see, you know, Alex will talk about providing proof in a testimonial. If you cannot put Alexi, you can say ah Baltimore, Maryland, right? You can do you you want to go as close to providing the the reasonable believability of that uh of that testimonial if possible. So get as close to it as you can.

59:05>> So because I know you donated 800 bucks, so I appreciate it. Um, but inside the proof playbook that's in the sales system that you got for free. Um, there's uh the 13point proof checklist. Basically, when you're going through the case study, check off every single one of them that you can. That's just not the the name. >> You're right. >> Makes sense. >> Cool. >> So good, man. Hey, um, I want to say one last thing for everybody just for them to understand. People will talk to Alex will share with you a lot saying

59:34>> you know I need to build a brand right away but this is a great example of building an awesome business and he said that I've never posted any content you can still run a great business. So first off kudos to you man like you built a great business. Yes it's in yes it's a little commoditized but you have now have a chance to you have dry powder to build and stack a new money model on top of it. So kudos to you for building this. It's a great example for others to saying hey I you don't need a brand all the time you just need a great money model.

59:58Well, a lot of what's happened recently has been, you know, secondary, I think, to some of the readings and and learnings from Alex. I really appreciate you and and Sean, your advice today and in the past. Um, it's gone a long way. And so, I think you're you're really hitting the mark in terms of helping entrepreneurs. >> I started my school community a few weeks ago and I just finished transferring my online course to the platform. Awesome. I so far love it. I'm looking for ideas to monetize the platform. Great. At the moment, my course is free and lead magnets 30-day daily drip. Great. Does it make sense to charge to release the whole course in one shot instead of having them wait?

1:00:28Um, you might know more about this than I do, Kirby. So, basically, daily drip versus doing it all at once. Have you seen any data on that? I just don't have it. I would be making up my answer. >> Me, too. >> Yeah. I think where we're trying what we're I'll just give you the school perspective is that we're trying to build in and I think this is coming very soon um the ability to unlock modules based on either their level or their time. So actually the level is already there but like based on time and so that I think will stick a lot of people longer. So this is a free community so it's like I don't know how much it really matters. Um the upsell will be to release fully. I don't that that doesn't seem compelling enough to me. Like if they're already going to get in 30 days, like that doesn't that's that's to me I'd rather you just have that be the free community and then upsell into a paid community that has like 365 days, right? Because then somebody who's into that is going to be into the next thing and then it'll kind like I think you should have fewer. And so instead of 30 videos, I'd break it into like seven or five. Um and then have the CTA at the end and then put more of the value in terms of like one weekly call where you pull someone up like we're doing right now. Answer the questions, soft toss.

1:01:47Hey, this is actually the type of stuff that I do in my my private thing. Um, and so I actually have a really cute moniker that I will give you um that I'm now going to use a lot, which is give away the information, sell the personalization. So, give away the info, sell the personalization. That's the that's the the sexy factor because all it's like, cool, this is all generic, but if you want me to personalize this to you, then join my thing. I do one on six. We meet once a week and that way we can drive forward and make sure you're doing all this stuff. And if you get stuck, I can get you unstuck. So the question is just how how valuable your time is to you. If you want to do trial and error for a year, I've got the I've got the free group there for you. If you want to get there in a month because we can every time you would get stuck for a month, we can get you unstuck in a day, then it's worth it. It just depends on how much you value your time, right? Commercial refrigeration. That sounds fun.

1:02:34>> Greatest businesses, man. >> Really? Commercial fridge? Yeah. I mean, there's probably like 10 of them and they can charge whatever they want. Yeah, that sounds interesting. >> My heck, what's up? Hey, Alex. >> Hi. What's revenue? What's holding you back? How can we help? >> Awesome. Revenue is about a million. Um, gross margins around 40%. >> Nice. Oh, gross. Gross. Yeah.

1:03:00>> Okay. Um, >> so 250 250 net. >> 250 net. Yeah. >> Okay. Got it. 40% gross margins. Got it. Um, all right. Commercial refrigeration. Uh, um, Got it. Okay. Okay. So, what's what's holding you back? >> Um, I think pricing. Um, I I think I said in the context text like uh qualified leads, sales team, and pricing, but since we're talking money models right now, let's go with pricing.

1:03:28Um, I sell a commodity. It's a $100,000 per ticket commodity, but um it is in in the end like hard to differentiate like the value of a you know $50,000 walk-in cooler versus a $100,000 walk-in cooler, right? Um >> and that's kind of I think where I'm struggling because I used I was at this workshop and it gave me some great advice about referral bonuses which I implemented. Um got two new clients out of that. So, I 5,000 on the referral bonus, got a $100,000 client and a $50,000.

1:04:04>> So, you ROI the uh the day. Fantastic. >> I did. I did. And then the challenge was um that the client, one of the clients that I did pick up from that is really price sensitive. So, someone comes along with like um you know, an offer that's $5,000 less than ours. Yeah. And they'll go with that instead of ours even though we can provide >> Yeah. I would perceive as more value because we actually have stronger communication which is very rare in the construction industry.

1:04:35>> Yeah, I heard. Um >> can can I cut you off because I because I I want to help you out because I'm pretty sure I know what you need to do. >> Please go ahead. >> Okay. So the thing is is that like for sure you're providing more value. They just don't know you're providing more value. So it's a communication issue. So we have to frame it. And so I I'll explain that differently. So number one, we have three vectors of value, right? We have risk, we have ease, and we have speed. Right? So, you want to win on one or more of those ideally in terms of your core deliverable. Now, for the business that you're in, I'm going to bet that speed and risk are going to be the maybe even actually you have vectors in all three. We need to basically calculate the cost that they have to incur over a longer period of time by using a competitor versus using you. And so, when they factor that into the overall price, it should be a steal.

1:05:22Does that make sense? I think so. But I would love an example. >> So let's say that because the communication is poor on like this is where industry averages and stat stats are super valuable from a selling perspective. I would say okay it turns out the average commercial refrigerator breaks down once every you know 9 months or every 18 months or whatever the number is right it's just like now unfortunately every 18 months though it costs 30% of the average you know commercial refrigerator in terms of price to fix it or I don't know again I don't know what the price is right and so the thing is is that with the vast majority of other people they're going to uh save you a dollar today and cost you $4 tomorrow I'm going to charge you $2 today and save you $4 tomorrow.

1:06:03>> And then that way you can you can price in the savings of the additional services and value that you provide. >> Yeah. >> I sell online coaching, training, nutrition to physique athletes primarily is our market. Yeah. Um topline revenue of the team this year was 900 900,000. Uh we're kind of projected to hit 1.1 this year based on monthly revenue targets. Um I'd like to be at 10. Um, and two concerns.

1:06:31One primary constraint is like lead flow, like the amount of leads that we're generating in that market. Secondary that I think is part of the stopping me is concerns on the vertical in that market. Um, because bodybuilders are not the richest people in the world. Um, but [clears throat] it's what our reputation is known for. Like we have J3 University, which is our coursework university side that's built that reputation. Um, and so that's like the two main issues that I see. Now, all of our lead genen has been organic. We have no paid ads currently. So, that's kind of like our next step in [clears throat] lead genen potentially. Um, content creation is daily. Um, so that's on my personal account.

1:07:10>> On Instagram, >> uh, Instagram and YouTube. >> Okay. >> Yeah. So, lead genen is my primary problem. So, direction on like paid ads with that is is helpful. We do paid ads for the university. Um, which does great, but that and then thoughts on the vertical within like the physique sport market. >> Well, I think that being, you know, working with physique athletes is kind of one of those aspirational things I was talking about earlier. Like if you market to the top end of the market, I'm sure you get people who inquire who are not physique athletes but just aspire to be.

1:07:39>> We do. >> Do you take those as customers? >> We do. >> Then I don't think there's any issue with you kind of branding and positioning in that way. >> Okay. >> Um because you'll again, you'll scoop up the people who are underneath the market. You just won't scoop up the people who are above it. >> Okay. And so you being already anchored at the top is a good thing. So you think about like >> the branding that's associated with like Northace, like they're not showing, you know, a mom walking from the Range Rover from the car to the door. What they're showing is a guy on the top of Everest because that mom will think, well, if it keeps him warm there, I'm sure it'll keep me warm from the from the car [laughter] door to the house, right?

1:08:11Yeah. >> The Range Rover shows you, you know, going up a mountain, you know, and doing whatever they do with those cars, but the person who buys it, it's like, well, it'll probably be okay if it snows, >> right? And so having an aspirational anchor, right? Um, still makes sense. We have a portfolio, right? But then we do this. And so people who aren't necessarily portfolio ready can still get benefit from the business. >> Okay. Yeah. Because my main concern is like I'm no longer in the competitive space. Like I just run the business. So that story

1:08:38>> doesn't matter at all. 0%. When I ran gym launch, I owned zero gyms. >> That's fair. Yeah, that's fair. Um, and so >> they just care about what you can do for them. >> Then on the ad side of the creatives, like >> we have had some trouble in the past with like showing physiques, um, as far as like ads on the university side. Um, and so my goal was to primarily get into storytelling of like that journey to accomplishment. Is that kind of the direction you would head with ads? And would it be combo me and UGC or would it be predominantly me at the start and then if I'm like the face of the business?

1:09:12>> Well, I mean I think you UGC for sure would be great. >> Yeah. >> Um which you can build that loop into any business which I think I highly encourage every business to have. I made a video about this, but basically I try to as quickly as possible build a loop in every business where we advertise like there's a one-time input from me to advertise. The advertising gets us customers. The customers get us testimonials and reviews. those testimonials and reviews spin the wheel of advertising so that that first time effort only comes once from me and then from that point going forward it's a self-looking ice cream cone and so as long as you have a cadence or an incentive for people to um make you advertisements or testimonials and the amount of testimonials you'll get surpasses the amount of ad creative you need in order to get new business then that business becomes self-sustaining from an advertising perspective. So for me my goal

1:09:57>> the differentiation is we have some circular marketing that happens. So like ads on the university drives people to the university and then the university converts into the coaching business >> and so like the ad side on the coaching business should be pam predominantly UGC. >> I think that you might so this is actually a really interesting fun one which I know will apply to more than just you. So, I had a lady 6 months ago who had a um she helped hair stylists learn how to put extensions in. So, it's like how to do hair stuff.

1:10:28>> Yeah. >> And then she also had a business coaching thing for how to once you have know how to do extensions, how to run a better extension business. >> And so, [clears throat] she was like, well, I'm advertising both of them. What should I do? Should I is it two businesses? Blah blah blah. >> And so, I was like, okay, what's LD to CAC? And so it was 13 to1 on the business coaching side and it was 37 to1 on the teaching women how to do the hair thing. >> Yeah. >> And so the issue wasn't that she had two businesses. She had a front end and back end that she didn't realize was a front end and back end.

1:10:56>> And so I was like, okay, turn off your ads for the 13 to1, turn on the ads to the 37 to1 that has a 20 times bigger TAM. That brings everyone in. and that all your focus goes on ascending customers from the profitable acquisition into the higher higher level back end that we already know not all customers are going to be a fit for and that's okay and so you said that the ads are working fine on the education side so I would say cool the issue that you probably have is you need to have a more choreographed ascension process from education into service

1:11:26>> okay >> and then that becomes the business >> which we're working on it's not where it needs to be 100% >> but as soon as you have that fixed the results that you're on your current business for the education side which are already doing well will just do like three times better because now you can actually have a blended LTV >> off of the single cost a car customer. >> Yeah. And we keep them pretty separate cuz there's different owners in university business that aren't in the coaching business.

1:11:50>> Well, that's just complicated. >> It's messy, but it it's I I run the coaching business. So, like I'm predominantly the one running it. >> Well, then you have to just treat it like an affiliate relationship that's arms length and then you give them some sort of kickback. as long as cuz then at that point you have free customers and the only cost is whatever kickback you give. If you like this video and you're a business owner who wants to break through your current revenue ceiling, I distilled every lesson from scaling 10 businesses past 10 million and three businesses past 100 million into a completely free scaling road map that I've used to go from 0 to 1, 0 to 10, and 0 to 100 plus. And so you can click here and you can check it out. Again, absolutely free. And since you're a business owner, appreciate you and uh enjoy.