Alex Hormozi's Advice on Branding in 2023

I was originally asked to talk about branding on social media I will talk about brand for about five minutes and the main reason for that is because I don't think it's going to make you more money so I'm going to be hijacking the other 55 minutes of my talk to more [ __ ] that I think will make you money than talking about social media branding and that may sound uh conflicting with how I am doing things but it's more about context so everyone here who here owns a brick and mortar gym can I just get like a show of hands wonderful okay here's my quick thing on brand and then I'll get to all the stuff I'm going to draw so big picture brand isn't actually a thing it's an association we make between things that we know and things that people don't know which is usually our company and so if you think about a brand like a bouquet of flowers right get these little flowers these are my flowers a bouquet of flowers thank you uh you guys you're gonna love the rest of the presentation a bouquet of flowers isn't actually a thing it's many things put together and we put it in our heads as an idea as one but it doesn't it's not actually anything because if you spill it on the floor it's not a bouquet anymore right and so when we brand think of a brand as a bouquet of flowers but it's your bouquet of flowers and what you're putting inside of that bouquet are the individual intangible ideas that you want to associate together with the thing that people don't know about which is usually your company right and so if I were to say some things about my brand you'd probably know that I have the best calves ever right so that would be something that's like associated with my brand there'll probably be some things like dessert that's something that's associated with my brand now those are like fun little doodads but hopefully some of the things that you really associate with my brand are giving first providing value being patient doing the boring work whatever doing blah blah right dot dot and so there are these intangible things that we associate and the thing is is that like if I were standing on stage next to let's say a guy who owns a brothel and a drug dealer you would associate my brand with that and so you think differently like the bouquet would look different and the reason brand and reputation is so hard to maintain is because so many people want to rub their [ __ ] on yours because if as soon as yours gets better they want to associate theirs with yours which is the right move for them to make but it gets harder and harder for you to make to get them to not do that because they continue to dilute and not really dilute because you don't actually dilute anything you just make more associations that aren't with what you want to do all right so let me give you an idea here so let's say here's my bouquet then I've got this sad flower so this is a sad face flower there's my sad flower if I handed my wife this bouquet all of the Roses are perfect and there's this one that's just wilted and dead it looks a lot different right the bouquet the brand the perception of it massively shifts even with one [ __ ] up flower and so that's why creating a brand is much more about cultivating deliberately the associations you want to make with the thing you have that people don't know with the things that your ideal audience likes that you want them to like too does that make sense I'm seeing some head knots and so if you have a clean gym people will start to associate your gym with the intangible idea of being cleaned right if you have really friendly people they'll start associating smiley faces recognizing their name when they walk in the door with the brand which in the beginning they don't know what it is the name is meaningless to them but we create the meaning by associating with the things that we know that they like and that is the process of branding done at scale and you do it over and over and over and over right now we put out 250 pieces of content a week and in six months we'll probably be at a thousand a week in terms of what we're going to be putting out and it's just an absolutely brutal repetitive violent process to get as many people as possible to remember one or two things about you does that make sense now let me tell you it doesn't probably make sense for you you probably can't do that which is why I talked to kale before I I got up here the brand that you're going to build in a local community is going to be based on the quality of your product and your service your reputation is going to be based on that and so if you feel like you want to strengthen your brand strengthen the product you don't need to make a video on Instagram every day talking about fat and carbs because real talk you're not going to be better most likely than the hottest chick on planet Earth talking about the same thing in terms of reach and the thing is and here's the double-edged sword let's say you are amazing at it if you do that what's going to happen is that you're going to get more Demand on your personal brand and online instead of people who don't live close to you that your that will be of Greater business opportunity for you than a single local location and so then you're going to have a choice and many of you probably have done this well I've got some online clients I've got some in-person clients and it's I'm totally spread thing I don't know what the [ __ ] I'm doing right Real Talk anyone does this resonate right okay and so that's why it's really about focusing on the one opportunity that's going to give you the highest Roi which is going to be the remainder of the time that I'm going to be talking today all right and so I was asked to talk about social media and branding I think that for most local businesses the brand is going to be about the reputation the reputation is going to be built on consistently meeting expectations now the thing is we always talk about over delivering and I've even talked about over delivering but I think a lot of times I think about this and the real real is that most people just can't even meet expectations because we sell so hot and so if you could just meet the perception that this person has the expectation they have of this the service that they're going to get you already won make promises keep promises make promises keep promises and if they would like the first promise you made them and you keep it they'll be with you forever okay that was brand so if you were like I don't care about brand welcome to the next Tick Tock all right so these are the topics that I want to hit on today so we're gonna start with a little exercise I'm gonna call it the magic wand all right so right now if I have a magic wand or you have magic wand and you wave it and you get to make as much money as you want all right so write down or put at least think about it in your head what number that would be per month okay how much money are you making per month okay hopefully it doesn't take too long to think of a number now who here currently is making that amount of money please raise your hand wonderful so we have just done established a gap between where you are and where you'd like to go fantastic so here's you here's goal which we all just established now in scenario one you have these goals right and there's all of these different ways of getting there right and the problem is you're like which one do I do before I explain more on that scenario two is I don't know what to do to get to there let me tell you how these feel this one feels like anxiety so if you feel stressed or you are overwhelmed about which thing you should do that's this if you don't know what to do you're at a loss you feel hopeless because you're like I don't know what the [ __ ] to do like I don't know I don't know what to do and it's not about picking it's like you don't even know where to start and this has been really important for me to identify if I feel anxiety it's because I don't know which thing to pick if I'm feeling sad it's because I feel hopeless I'm like okay helplessness means I have a lack of choices so I have a lack of choices means I'm I have ignorance around this topic okay this makes it solvable so then I can start solving for I need a path so that I know what to do it's the only thing I know me personally that's what makes me sad is if I don't know what to do I get sad is this resonating with anyone here okay so that was Tick Tock too this one was about figuring out which thing to do this is about figuring out what to do so when you're deciding which thing to do this is a clear case of lack of strategy all right now strategy is a big fluffy amorphous word that gets tossed around a lot and no one knows what the [ __ ] it means but it's probably important in my opinion is the most important but I'm going to give you a different definition for this to make it a little bit more useful okay strategy is just prioritizing it's all it is like whenever you hear someone say we have to figure out our strategy it just means we have to figure out our priorities that's all it means and in layman's terms it's what's going to get us the most bang for the buck if you want the fancy definition that I have it's how you choose to allocate resources that are limited against unlimited options that is strategy and the tough part about this about strategy in general is that when you're looking here you have all these options strategy is figuring out actually there's one that's right here that takes us off the page because the most costly thing in business isn't just the unknowns but it's the unknown unknowns as in the things that you didn't even know you could pick from so let me give you three examples example number one we had a company so the first investment we made I was still I still owned 100 of launch at this point uh it was a photography company and so this photography company at a single location and the owner had an agency to help photography owners and he was like I want to do what you did with uh gyms with photography I was like okay and so the more I got to know the more I learned about the business I was like nah I don't think we should do that because I'll tell you the stats around it so he's like well uh it caught you know I charge five grand and I was like okay well what is the average photography studio ad in Revenue after using your thing he said 400 000 a year I was like so they add 400 000 a year and he was like yeah I was like and you're charging say it again he's like five thousand dollars so it's like okay let's not do that anymore and uh I was like does it cost less than 400 000 to make and mind you that was added Revenue not total his was doing millions and I was like okay how much does it cost to start one of these and he was like not a ton I was like huh crazy idea here I was like What if we own them all and so that's what we did two and a half years ago now we have 77 individual Studio locations in terms of rooms where we take pictures um and that business went from I don't know a million and a half a year to two and a half million a month in that time period the point the reason I bring this up is that it wasn't a move that was on the board he's like how do I grow this agency how do I turn this into a coaching thing and I was like no like you have a business model that has amazing Returns on Capital let's just do a ton of them right it was operationally simple we could centralize a lot of the stuff which is different than like a gym gym is a lot harder to centralize things more decentralized so I show this to say that right now if my goal here is to make you guys as much money as humanly possible by the time I'm done my 46 minutes then if I can just get you to make the one chess move that will make you the most money then it will Roi everything you do this year or maybe the next five years because fundamentally people don't actually move faster than other people like you see me walk it's not like I'm hyperactive it's just you get more for each step when you are more strategic when you have better priorities and you allocate your resources time money energy into the fewest moves that get you the most bang for the buck you make the most money so back to this [Applause] you guys want to hear a different example so we had a we have a PR Company that we bought um that was was selling 100 units a month of PR services and they did decent decent business really good marketer so so delivery but I really like the founder and so we dove into the data and it looked like 85 of the businesses turned out within two or three months which is horrendous fifteen percent of the customers paid the most and stayed the longest and they were different I was like wild idea what if we stopped selling these 85 percent and only sell these 15 and cater our stuff to only them he was like that would kill my business mind you recurring theme of the first one when I told him to shut his agency down he had to go to zero and then built the next thing and for nine months he was basically at zero-ish hard like tough very simple to say very hard to do good you guys imagine if you have two locations I was like hey I can help you get there for a year you're gonna have to make no money cool what do you do play a long game right and he was willing to do that and that was me talking to him off a cliff every week being like hey man we're gonna get there and so with this individual uh with the pr we he cut 85 percent we catered the messaging and we made it way more Niche down to this specific Avatar and we 10x the price and now we sell more units than we did before we 10x the company strategy rather than thinking okay what am I going to do to just get more now there's always a time for more believe me violence is the answer big fan all right a brutal Relentless effort but we want to make sure that we're capturing the most per unit of effort and so the equation for this is volume times leverage equals output which means the more times you do something and the more the more you get for each time you do it the more you get ultimately now if you're a lazy [ __ ] guess what you better have a shitload of Leverage now you can be lazy and still make tons of money you just have to have lots of Leverage you got to be really strategic in the moves you make the more activity you have the more you can let a little bit of that violence work for you but it ends up becoming a cap soon enough because at the end of the day we only have x amount of hours and if you want to do big [ __ ] you need a lot of other people's hours to work for you which is a form of Leverage okay so one moment it's a different style Tick Tock versions all right a little little stop and go okay got that we got that I'll give you a third one so we need a company that is an association of of uh trying to keep it vague let's call dentists Association of dentists they had a they had a business that like they glob all the savings together of all the dentists so that they would charge less than all of them saved with with the conglomerate of buying power right so if you save 30 000 a year as a dentist they would charge ten Super sticky model great business and so he's like hey I think I could sell this thing for 20 or 30 million and uh I was like how many dentists do you have there it's like I don't know 500. it's like and they all run the same systems it's like yeah it's like what's the average dentist make like per unit it's like I don't know 500 000. I was like wild idea what if we take 10 every year bundle them up and sell them from 100 million every year get 20 give 80 to them that'd be chill right I was like then you get your exit every single year and then if you want to sell it we exit the machine that does Roll-Ups because in that you have roll-up machine does 20 or 30 million a year in profit and we get 10x on that now you have a 300 million dollar your exit rather than a 25 million dollar year he's like that sounds better I'm with you I agree strategy prioritizing what move will get me the most for the effort I put in all right now this is a perfect transition to you're like okay that sounds very Pie in the Sky so next tick tock theory of constraint so everything that we do at acquisition.com and the approach that we have with growing any business is spending a lot of effort to try and identify the constraint of the business because every single business is constrained there's one thing that is limiting its growth so right now and here's the [ __ ] up part many of who here works all the hours of the day like mostly hours that you're awake okay half of you if your business is not growing as fast as you want it to you are working on the wrong stuff if it has stayed the same and you're spending all your time working on it you're not going to get more hours so you're doing the wrong [ __ ] so it means that you have not properly identified the constraint of the business so I'll give you an example of this we had a media company that came to us big YouTubers 40 million plus subscribers and they were like hey I was like what's the goal they're like we want to make money I'm like cool love it great goal so they're like we think that we need to create a better media machine it's like okay they're like we need to really systematize this and do it better it's like okay how are you monetizing AdSense by the way very inefficient way to monetize okay and so they're like I think we're I think this is these are all the things we need to do to eliminate our constraint for our production cool it's like have you thought of wild idea maybe we just like the constraint of the business is that you don't have something to sell I was like you're like a 97 out of 100 on media and you're at zero out of 100 on [ __ ] to sell and you're trying to talk about how to get to a 99 rather than like if we just went from 0 to 20. we would probably make you 10 times more money than you're currently making and so that is an idea of the theory of the constraint right like the constraint of that business was not media and many of you the constraint of your business is not making better [ __ ] workouts right that's not the constraint it's not the constraint right that's not the constraint and so right now if you spend all your day working on [ __ ] that doesn't move the ball working on the wrong [ __ ] so let me tell you how we do it so that hopefully you can too so one of the questions I like to ask is why can't we 10x this business like why can't we and sometimes asking that question and then it becomes really apparent what the problem is and the answer is sometimes well we just need to hire all these people it's like well let's [ __ ] do that right and so here's how we transition into the tactics around this so this is the actual first part of my planning process prioritizing process strategy process whatever shoe fits you for figuring out what we're going to do with the company that we're going to grow so when we're thinking about all the objectives all the things we could potentially do it has to map to one of these three objectives which is one how is this thing that we're going to spend time money effort on going to get us more customers two how is this thing going that we're going to spend time money and effort on get us increased ltgp make them worth more or three how is the time energy Etc going to decrease the risk that this does not continue to happen in the future which is another way of translating how do we increase the Enterprise Value overall so for example if you do all of this stuff that's great still really risky because if you die the business dies now if we have to hire someone to do the same thing as you is it going to get more of either of these probably not will it make the thing more valuable absolutely does that make sense so I'm going to segue briefly we're going to side quest imagine two people five million Top Line 5 million Top Line 2 million in bottom line 2 million bottom line this guy is a single owner runs every all the day-to-day has lots of minions known with real brains and they just do what he says okay if this person dies the business dies this guy has a team that runs the whole thing and he makes two million dollars in income from the business but it doesn't require him who's richer this guy question is how much richer a lot this guy because he doesn't have to do anything means that somebody else could also not have to do anything and also collect that two million dollars a year which means his thing is probably worth depending on what type of industry it's in 10 15 sometimes 20 million dollars and so when this guy here's where the leverage comes in Big L if you go from 2 million a year to 3 million a year in income he just added 10 million dollars to his net worth this guy is concerned about all of the tax evasion strategies because he's trying to maximize his income and forgetting the fact that the asset is the thing that's going to build its net worth this took me a really long time to learn like an absurdly long time everything I did was all about like how do I take the income I have be more efficient with it blah blah blah when it's really like you become wealthy from the [ __ ] you own not the [ __ ] you do so everybody here has a business and right now many of the businesses in this room are not valuable no one would buy them because it's really just you with some helpers and so the idea is that we have to transition and this is a skill that is worth getting because no matter what you do for the rest of your entrepreneurial career you're going to need people you need to have the skill of hiring recruiting training onboarding managing Talent who here has one amazing Superstar person who works for you cool imagine if you had four of them at your one location how easy would life be right you make a ton of money here's what's [ __ ] crazy the difference in small businesses and big businesses how many a players they have and so what happens is most small business owners hire a lot of people get lucky one sticks actually works their ass off at a fair rate and you're like oh man if I had six more sandras right I'd be good to go the thing is is that big business owners maintain a higher level or a lower tolerance for mediocrity and so they actually do keep looking until they find six Andres and then it does become too easy for them to kill it because I got six Sanders how could I lose that's the idea make sense oh God this took me a long time to learn like I would just put up with people who were mediocre and right now many of you have a think of somebody who's mediocre on your team actually I'll make it easier think about that person that you thought about today who you shouldn't have thought about because if they're not making you money and you're not sleeping with them don't think about them first thing in the morning all right so anybody have somebody in mind so if you have that person in mind that person is taking up 25 of your bandwidth what a cost right and probably many of you the biggest lever of growth is on the other side of a few hard conversations I now talk to portfolio CEOs all the time and it is incredibly clear the people who will win and the people who will not is simply based on their ability to confront discomfort and it's interesting because this is a mostly Ah that's a kind of 50 50 actually audience between male and female but a lot of guys beat their chest I can cold plunge I can run a long time without stopping lift lots of weight but you can't just say hey man I think you suck a little bit real can't do it and for that reason they suffer for [ __ ] decades because they can't fire Sarah not Sandra Sandra's stud right can't fire Sarah it's like yeah I know she slept with one of the clients but like I mean I think her heart's in the right place it's like whenever you're whenever you're qualifying that someone's heart's in the right place then deep down they're a good person is because it's obvious they suck right hit a nerve on that one uh so right now do me a favor write down the name of the person that you know you need to get back to and start what we call a performance Improvement plan because you've got 14 days to fix your [ __ ] or get out and many of you can't even have the conversation because you're too much of a [ __ ] pansy real talk and this will keep you poor seriously like you have like you got to grow up you got to be able to have hard conversations be like hey my biggest my biggest piece of advice for this is you know the [ __ ] you say about Sarah while you're here behind Sarah's back God she's just like she's been slipping lately you know what I mean like she's not sure up on time she's not cleaning up after the classes she's short with the with the clients I had two people complain about her right say that to her that's it just think about what you'd [ __ ] talk and just say it to them it's just the truth just say it to him see what happens one of two things either they're like [ __ ] I've had my head up my ass that's why it's been so dark um right you're totally right thank you pull it out right and all of a sudden they have a total 180. that happens like one out of five times four out of five times you say these are the things that you have to do they either say I won't do that or they say sure I'll try and we both know they're not going to and then you elegantly exit them from the business the problem is that right now Sarah teaches like six classes now what gotta find somebody else she's killing your business so get rid of Sarah all right so that was a side quest but hopefully we found some treasure there and uh write the name of the person need to have that hard conversation with and be like there's this [ __ ] speech and this guy was talking [ __ ] about you and I should have talked to your face and so this is me talking [ __ ] to your face so that I feel better about it you kind of suck okay thank you [Music] [Applause] really took that Tick Tock thing to heart um Okay so I'm going back to this that was the side quest main quest so right now there's a lot of [ __ ] that you guys probably learned so far You're Gonna Learn tomorrow and the rest of the day Etc if it doesn't do one of these three things toss it number one number two you might only be able to do one of them or two of them and so then you got to pick okay of all of these things which of these has the highest likelihood of working with the least amount of effort you do that one first and as silly as this sounds many of you won't do this and the reason I say this is because I talk to people who are making a million a month a million a week and they sometimes forget too so like when you have the same conversation over and over again you start to develop Frameworks around it all right and the first framework that I wanted to give you around strategy is how does this get us more customers how does this make them worth more and how does this increase the likelihood that those two first things don't stop happening if it doesn't map to that forget about it just cut it because there are other things that will do that that we should be doing instead cool now the second framework is going to go one level down what who how so usually when you do this whole thing you get a big list of whats right these are all the things I got to do what what what what you're like [ __ ] there's a lot of whats who's gonna do it most time you're like me right the difference between the guys who become bigger business owners and the ones who don't is they have to think how can I get my team to do this for me now this is not a team team talk but I am telling you that the reason the gym launch went from three million a year or whatever it was to 37 and still cranks um which because of Layla because I was like we're gonna make it the Alex show she's like that's a terrible idea um and so she built a team and started empowering the team she's like you can't do that she started taking things off my calendar I was like hey I like that she's like no not for you that's for Sandra look I got six Sanders they all want to work and so what ended up happening is has anyone given a task to someone on your team and they actually just did a great job with it and you're like oh thank God that was awesome anyone had that happen okay so big businesses do that all the time and you just do it lots of sandras and if you can't give [ __ ] to any sanders then you're the problem because you have really low standards and you're a [ __ ] you can't have hard combos that's what it like literally it comes down to that big Macho guys can't tell the female trainer that she sucks can't do it you can't do it and so what happens is we have this big list of whats and then we put Santana on the first two and we're like but man it'd be cool if we could do some of these other ones who should we give it to and then we start assigning the who's but here's a fun trick if you've given the same who the same thing 12 weeks in a row like each quarter and the what's not done that who's the problem winners win and I'm sure that the best people that you have on your team hit the ground running started taking [ __ ] off your plate immediately start executing everybody loved them remember what that felt like that blueprint is what talent looks like and you just have to do more of that get more of those people which then opens up the next thing which is I'm not the type of leader who will track that type of talent I don't have time to get into fixing you right now but that is what the next thing that happens is okay fantastic so Tick Tock over for this strategy session go to the next one all right oh good I'm a great impressional time next framework for you [Applause] more better new so as soon as we figure out that we have the highest strategic leverage activity that we can in a business we then ask ourselves can we just do more why can't we do more I want to do more more money let's do that more more right or we say can we do it better we don't have to invest in any resources just do it better we're going to go from calling leads in 30 minutes to calling leads in under five deal fantastic once we do all the mores and all the Bettors then and only then do we do new now here's how most small business owners decide what they're going to do there we go new and the thing is a lot of you guys are going to come back from here with lots of new and you're going to be like hey team I'm going to vomit all over you I'm going to make no plan it's going to be awesome and they're just gonna be like let's give it a week he'll forget about all the things he said and we'll go back to normal real talk it's gonna happen gym launch since we sold it to whatever ish years ago whatever the time was 2021 I'm so proud of kale and the team because they consistently ask thank you um how can we do more what we're doing how can we do it better Jim wants is going 40 since Alex and Layla exited the majority share we still own 30 plus percent of it but and I think in a lot of ways Kale's a better CEO than I am because I also like new shiny things too but kale is super disciplined he's an exceptional CEO there's a lot to learn from him how can I do more how can I do it better so it's like hey dude I think we should be getting on Tick Tock he's like you know we could also do we'd [ __ ] double our cold call team do that what do we do that what's the likelihood that if we double our cold call team we'll make more sales hi we already have a trodden path there let's just do more of that but what about tick tock it's like yeah likely that we're gonna get sales I don't know we've never done it before I don't know but what about this kid I saw on the internet he's making millions let's just double our cold culty and then let's look at our better and say like do you think we can clean the numbers more do you think we can improve the script do you think we can follow up faster do you think we can personalize the reach outs more probably and so right now this is real real the thing that is killing most of you guys is the desire to 10x in 90 days and then not doing it and trying something new and hoping for a silver bullet That Never Comes it's just it's a hundred golden BBs like the big businesses it's just golden BBS it's just improving lots of little things over and over again the 40 Improvement that Jim won't just had since we sold our majority share has there's been no one thing and man wouldn't I love to make that short video there isn't one thing we just improved a lot of little things and that creates the big outcome and so right now you probably have this big list of should do's like I should do that I should probably email my list sometime at some point I should do that right I should probably do more called DMS or do more reach outs I should probably make more ads to run I should probably do that I should probably figure out our pricing and optimize it I should probably create that sales training program or get my team to go through that sales training program I should probably set up a role-playing Cadence for my team so they sell better but you know what's new that sounds cool the should do's if you actually just wrote all the things that you need to do down and then you tick them off and you realize that it takes two years to build an exceptional business and you did nothing but just actually do all the [ __ ] you know you should be doing usually build a pretty exceptional business it's the rush that kills everyone it's the hope that this new thing is somehow going to shortcut the work that needs to be done and like this has just been truer and true because the thing is is that that list for a 10 million dollar company is longer and bigger that list for a 100 million dollar company is longer and bigger and it's just [ __ ] that needs to get done and So the faster you can confront the work that has to get done the faster you start getting the getting to the getting there you go this is making sense all right thanks man appreciate it all right now you're going to have a lot of different things you're gonna have a lot of different things that uh that you could do right and you've noticed this is the central theme is like you've got a lot of decisions to make and I just want you to make the right one I want you to make the one that makes the most bang for the buck and an easy way to order this is impact ease here we go so when you have your big list of [ __ ] just put it as one two three four just put a number next to it really easy lots of impact really easy do these first then once you've done all of those hey don't consume any more information once you've done wait I've I haven't fit once you do all of these then start working on these then so working on these then [ __ ] these I really want to Rebrand the logo why no one knows that you exist to begin with what are we talking about you're like I want to Rebrand it's like why like you have a nameless no one has any association with your first thing like Xerox is just made up letters right they created a brand because branding is the consistent action of associating the unknown with the known right it's I know I'm supposed to talk about social media branding I didn't think it was going to be super important for you guys uh because you don't need to for now in my opinion not because it wouldn't benefit you but because there are other things that I think would benefit you more just to be clear okay now I'm going to give you this little uh this little tirade and then I may I may have time but I may not have time at the end for Q a we'll see so oftentimes the things that is limiting the business is the big obvious thing so we have really big egos about our business we assume that it's exceptional we assume that it's excellent right but in your heart of hearts you probably know that if you were actually [ __ ] exceptional you would not be asking questions about how to get more leads because you would have people referring their friends and referrals by the way are non-linear in that they are exponential in nature to bring four four bring eight Etc so the book The 100 million offers book was probably my first big experience with that because I spent like a very long time writing it and then I gave it away for 99 cents and I made one post and I think this one had like 20 000 Instagram followers in total and I didn't have really any other platforms and that book to this day sells more copies every month than it did the month before and like last month I sold 25 000 copies it's like almost a thousand books a day a thousand customers every day no marketing spent just word of mouth right and fourteen thousand five stars and so like it's the big obvious thing and from being in the room with Millionaires and sorry billionaires and decade billionaires the thing that has become so clear to me is that the people who are obsessed with their product are the ones that get the compounding and so every business needs to have some sort of compounding vehicle within it otherwise you're going to spend the rest of your life trying to promote it so think about this way if I spend two years trying to write a book and at the end of the two years it's exceptional I'm going to give the alternative example first if I spend two months writing a book and I publish it and I have to spend the rest of my life trying to promote it to get people to buy it a tough life low Leverage on the flip side if I spent two years trying to build something [ __ ] incredible and then let my customers Market it for me for the rest of my life more work up front less work long term it's just that being willing to delay satisfaction or gratification is in my opinion the single greatest skill that you can develop and what's Wild is that a lot of you guys think you have that skill you only do when it comes to cookies but not when it comes to money and so you like give your clients all these lectures about self-discipline and being hard and like you know believing your better self but like you will take actions that are in direct contradiction that same thing it's just we're switching calories for dollars same thing and so when I see a lot of the business like the gym owners that struggle it's just the big obvious thing the sandwich sucks they're like dude what's the new marketing thing for like gyms I'm like have you tried your sandwiches they are terrible why would you want more people to know right like it's it's it's real though right like imagine I had a mediocre book which is what most people would have and then I spent tons of money trying to Market it why would I do that it sounds ridiculous when you think about it you're like I'm just going to let everyone know I'm mediocre that would suck but that's what a lot of people in this room do every day and so the thing is is that in my opinion if I were to start a gym over today I would consistently work on the actual product the experience the way people get greeted the trainings for all of the teams into the world's simplest model and until people were not leaving I would not be worried about bringing more customers in once you get that right then when you're pouring all this gas in you can catch it because if you've got a hole out the other side you're a constraint is the fact that people don't stay and so the biggest thing that you have to solve for because now we we buy into a lot of brick and mortar Chains It's one of my favorites unsurprisingly is LTV or lifetime gross profit over everything the guys who can spend the most money on marketing are the ones who make the most money from ads so when you see these massive marketing companies or these massive campaigns that are out there it's not because they're better at marketing it's because their LTV enables them to spend as much as humanly possible on the marketing if you print cash on the back end you can get silly on the front end this has to sink in like this has to sink in and I keep being repetitive about this because I continue to get the same questions whenever I go and it's like what's the new marketing trick what's the new hack it's like you have to solve the root issue and it's kind of like the uh it's like it's like the gal who's like hey is it keto is it intermittent fasting is it you know like I'm just trying to give the parallel here like that's what you sound like you don't get it you got to understand how to count your Macros it is what it is done and so like in the business it's like you have to figure out how to get The Mousetrap to work even at its simplest level so that people actually like the thing you have and I just feel like so many of the gyms that I see and I go to it's obvious like it takes five seconds to see why they're not successful and the gym owner because they're in it can't see it because their ego their identity is attached to it because you think that if your gym sucks it means you suck and that's not true so you have to break that you should be like oh yeah we suck at that onboarding non-existent churn through the roof yeah you should see my trainers sleeping with each other it's terrible Place absolute pigsty right so what's your plan I'm gonna Market it I'm gonna Market it [Applause] so to give a quick a quick uh re recap and if I have time for Q a I will one brand is making associations between things that are intangible with things that are tangible and unknown so things that people like if I hold a bunch of bricks of gold on stage or I hold a bunch of stacks of cash you will make associations of money with me and if you didn't know who I was you would assume that I have something to do with money that would be your assumption that would be the association if I stand next to a porn star you'd assume other things right associations and so if you want to build a brand associate the service that you have with the intangible ideas you want the prospect to believe about you so if you want them to think that you are clean and you are friendly and that you care and start there magic wand if you feel sad immediately translate that into I do not know what to do next it massively simplifies this very like hard painful experience it's been really helpful for me so if you feel hopeless or you don't know what to do it means you just don't have options like you don't perceive that you have options it's a lack of options so you just have to become informed all right so whenever I think sadness I think ignorance it's like oh that's solvable and then I can start attacking it on the flip side if you have lots of options and you feel anxiety it's because you don't know how to pick which means you have to prioritize it means you have a lack of strategy strategy is getting the most bang for the buck it is allocating finite resources against infinite options and some of the biggest strategic moves are outside the board and that's where sometimes having gym launch other people Etc is helpful because you have outside eyes so your mouth inch below your nose but you still need somebody else to tell you a bad breath I heard that the other day I really liked it right now There's a constraint in your business if you do not know what the constraint of your business is you will not solve it you'll continue to do the [ __ ] you have been doing and that has not been getting you what you want so right now unless you change the activities you do you will not change the getting that you are getting so if you go back so I'll give you a different one so intelligence and learning this will be fun so the definition of intelligence is I Define it is rate of learning it's a speed someone learns fast they're smart someone learns slow a little slow right of learning okay what does learning mean this is how you can remember it same condition new Behavior which means the phone rings and I trained you and you answer it one way before I train you and then I have the same condition the phone rings again and then after I trained you you behave differently you have learned if you come to this event and you do things and then you leave this event and you do the same things you have learned nothing which means that change in behavior is the way that you can measure intelligence the speed at which you change Behavior with within the same conditions is your rate of learning the faster you do that the smarter you are and so some of y'all are hold on I gotta figure out the political one uh dumb but again when I Define words or operationalize them it becomes a lot more under my control so I'm like man I don't want to be stupid it's like they got to do this thing I went to this marriage seminar and they say that when my wife walks in the door I should say something nice to her damn right walks in the door you went to the seminar and you're like nice blouse she's like is that the top one or the bottom we're like I don't know one of them right and so same condition new Behavior it's also a great way to teach your team which is like I'm going to present this condition we're going to train and when I present this condition again I need you to change your behavior that's what learning is and so everybody here if you don't know what to do then you're not going to be able to change your behavior which means you're not going to get a different outcome so most of the success that I've had is my effort to try and boil everything down into an inputs to Output equation I remember when I was studying for the GMAT back in the day I found this research study that showed that the number of problems that you solved was in direct correlation with the score you got on the test and I was like oh yeah okay this is a clear input output like life isn't always this clean but I was like fantastic so I did about a stack of phone books this High I did four hours a day for 16 weeks of problems and then I scored above our Harvard's mid score I didn't start there but I had the graph I was like the more problems I do the higher my score is and by the time I got to the actual test I was like I've literally seen every one of these problems before and I've done all of them 100 times right and speaking really easy and so if you don't have the input to outputs equation which will be the last thing I do because kale asks me to talk about leads [Applause] then you're not going to get there all right so I'm going to give you guys a sneak peek you can write it down you can't take pictures or talk about it there's only eight ways to get customers you got warm Outreach you've got cold Outreach you got paid ads got content these are the only four things that you can do so if you claim that your constraint because everything's amazing about your gym and your trainers aren't sleeping with each other and the gym is really clean and people don't churn and you're priced appropriately and you have a really good onboarding experience and people get reached out on a regular basis to check in on them to show that you actually give a [ __ ] you do all that stuff right and you think that your constraint is more marketing which by the way everyone thinks that's what it is and if you keep thinking that nothing changes may be wrong anyways let's talk about leads so these are the only four things you can do you can either post content dear worm reach outs do cold reach outs or run paid ads simple I like to quantify this by the rule of 100. which means you either spend 100 bucks a down ads you do 100 cold outreaches you do 100 warm outreaches or you do 100 minutes of content you do it every day and if you want to get there faster do more guess what you'll also get better because you did more just like the problems on the GMAT test if you're not doing this stuff what are you doing you might be thinking about marketing or advertising maybe strategizing planning you're not doing any of it and the amount that you get will be directly proportional to how much of this stuff you do this is how you let other people know about stuff that's it that's all there is now op is other people you've got your customers who can refer you people you've got affiliates who can send you people you've got employees who work for you and then you've got agencies those are the other four types of people who can get you the stuff if you think about it any of these four do these on your behalf this by the way is Leverage if I can go get my customers to tell everybody about my book then I won't have to if I can get Affiliates all the chiropractor places in a five mile radius from my gym and all the massage studios in a five mile radio race for my gym to just give a free month with any new customer they have because they know that I will treat them right then I can just have 200 different businesses that come to me now do those 200 businesses come out of the sky nope what would you do warm reach outs cold reach outs run ads or make content targeting those people then they'd come and then they do those things on your behalf agency will do those things on behalf or if you do all that stuff then you cold Outreach cold Outreach warm Outreach paid ads make content to get employees and then the employees will do those things on your behalf is this simplifying some [ __ ] right now business can feel confusing and usually it's because we have not defined terms if you define the terms then you can know what you're actually talking about rather than like making noise with your face okay if you don't make noise with your face and just know what you're talking about it becomes a lot easier because the variables become defined and so if you want to get more leads you have to do these things if you want to get even more leads you get other people to do these things for you which starts with you doing these things to get those people that's it I have three minutes so I'm going to see if I missed anything by the way giving away really good free stuff great way to get more people to opt into your thing just in case anybody needed to be convinced about doing free stuff all right covered branding covered all this stuff all right let's talk about this last three minutes last tick tock of the day who here wants to know what it looks like when it's all the way right yeah talk about scaling it okay so let's give you a little bit of vision for the future so we love local Brands they're great they're wonderful Capital compounding Vehicles what you need to know is how much does it cost to open a facility all right cost to open then you got to know your top line revenue or more specifically your bottom line profit per facility the ratio between these things let's say it's cost me 100k to open a facility and let's say I make 100K per year then I have a 100 cash on cash return who here members of the stock market is less than that right which is why I like it now this would not be that interesting to me why because I know there's a lot of operational drag associated with opening a facilities to make 100 Grand e H right and so the idea is how can I is there a way that I can get a more leveraged model so I can make maybe like 250 to 500 000 per facility and then maybe even if it cost me 500 to make 500. then I only have to open one-fifth as many facilities in order to compound my cash now the way to do this and this is one of the things that I've observed with some of the most successful franchisors in the space is you have your facility now it has been your special child you have lots of doodads and lots of whiz-bangs that you've attached to it specialized sessions blah blah blah the franchise the franchises that are the most successful simplify it even if they're corporate or headquarters has like all this stuff when they want to scale they massively simplify they think how little square footage can I possibly use because I'm not using this to fulfill my ego I'm using it to fill my bank account big difference how little can I make this so that I'm really efficient with capital and then how can I make it as little operational drag as possible I can do it with six people but can I do it with three how would I incentivize those people I know I went from like super dirt or sorry clouds to dirt here um but that's that is how you unlock going from five locations to 50 locations and then you start building the machine that builds the location so then you have launch teams that fill it up before it opens you turn it over to management they keep running it and the big key of making all of these work is that it can't just be based off some unique acquisition Channel because those all eventually go away all advertising platforms will eventually become too expensive and they will eventually die because attention always moves right and so the only way to become enduring with your business like if you really want to not like if you want to sleep well at night you have to fix the back end if you know that if you don't sell any new customers you're still going to be fine next month and you do that for three or four more months and you'll still be fine that's the perfect business to then go market but like that's the boring work that no one wants to do I'm going to end with this one thing a franchisor of a really popular uh not really popular they had I think 20 locations uh franchise came to me and he's like my franchise isn't working right and they had I think six corporate stores 14 franchised and the average store cost about a million bucks to open and they made about a hundred fifty thousand dollars in profit per year right it's like you might as well just like invest in a stock and just not bother right like that's that's what you have to think with and when I saw that they were doing I think the average was like 1.3 in Top Line and 150 and bottom line and I think they were running like a very small margin I thought to myself I think it's actually less than 150. point is shitty margins he was trying to figure out how to Market his franchise better how ridiculous is that right but the thing is is that like many people who are in this room are thinking the exact same way and so instead what I said was hey man I actually think your margins blow and I think you have a lot of interest because that's why I took the call I knew the brand and I was like I think you have really good products I think you just you just have to get the Ops right so get your margins in check right you've got this menu that has 500 items on it boil it down to the top 15 that everyone usually does look at all the ingredients buy type see if we can negotiate better deals with vendors because we're going to consolidate all of our demand we'll get more volume Etc et cetera and so what I did was I said hey we've got 12 months I want you to spend one month 12 months in a row to get one percent profit back month one you get one percent back that's all you have to do it's my only thing that's one percent back and next month you'll find another one percent next month you're gonna find another one percent that's all you have to do hey if you find three months ahead next month another one percent in 12 months from now you would have a business that would be sellable would be investable and would have already tripled or whatever was the profit of that and made it a scalable Enterprise but he had spent 10 years 10. trying to scale the franchise when it was the big obvious thing the sandwich just wasn't that good the sandwich in the literal sense was okay for the customer but it was terrible for the investor so you had to fix the model and so I think right now a lot of everyone here as much as everybody loves to come for leads that's great a lot of you guys are just serving mediocre sandwiches and I think if you spent a year eating your own sandwich you would immediately see all the things that are wrong with it you'd fix that and then the rest of your life you'd be able to scale this thing thank you guys

Channel: Mozi Media

Views: 293,881

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Id: LGq0uVspNms

Length: 61min 36sec (3696 seconds)

Published: Tue Jun 06 2023