NEVER lower your prices...
ฝัง
- เผยแพร่เมื่อ 5 ก.ย. 2024
- Want to SCALE your business? Go here: acquisition.com
Want to START a business? Go here: skool.com/games
If you’re new to my channel, my name is Alex Hormozi. I’m the founder and managing partner of Acquisition.com. It’s a family office, which is just a formal way of saying we invest our own money into companies. Our 10 portfolio companies bring in over $200,000,000+ per year. Our ownership stake varies between 20% and 100% of them. Given this is a YT channel, and anyone can claim anything, I’ll give you some stuff you can google to verify below.
How I got here…
21: Graduated Vanderbilt in 3 years Magna Cum Laude, and took a fancy consulting job.
23 yrs old: Left my fancy consulting job to start a business (a gym).
24 yrs old: Opened 5 gym locations.
26 yrs old: Closed down 6th gym. Lost everything.
26 yrs old: Got back to launching gyms (launched 33). Then, lost everything for a 2nd time.
26 yrs old: In desperation, started licensing model as a hail mary. It worked.
27 yrs old: "Gym Launch" does $3M profit the next 6 months. Then $17M profit next 12 months.
28 yrs old: Started Prestige Labs. $20M the first year.
29 yrs old: Launched ALAN, a software company for agencies to work leads for customers. Scaled to $1.7mmo within 6 months.
31 yrs old: Sold 75% of UseAlan to a strategic buyer in an all stock deal.
31 yrs old: Sold 66% of Gym Launch & Prestige Labs at $46.2M valuation in all-cash deal to American Pacific Group. (you can google it)
31 yrs old: Started our family office Acquisition.com. We invest and scale companies using the $42M in distributions we had taken + the cash from the $46.2M exit.
32 yrs old: Started making free content showing how we grow companies to make real business education accessible to everyone (and) to attract business owners to invest or scale their businesses.
34 yrs old: I became co-owner of Skool.com to help the many people who want to start a business online do so.
Today: Our portfolio now does $200M/yr between 10 companies. The largest doing $100M/yr the smallest doing $5M per year. Our ownership varies between 20% and 100% ownership of the companies. Many of them we invested in early and helped grow (which is how we make our money - not youtube videos).
To all the gladiators in the arena, we’re all in the middle of writing our own stories. The worse the monsters, the more epic the story.
You either get an epic outcome or an epic story. Both mean you win.
Keep crushing. May your desires be greater than your obstacles.
Never quit,
Alex
FULL DISCLOSURE
I make content to make money - just - on a longer time horizon than most. I want to build trust with business owners so we can find the best ones and help them scale. And if they’re awesome, write them a check and go all the way as partners.
Alex is my favorite TH-camr hands down. One of the few actually running big businesses and talking about it!
True words have never been spoken!!
Wooo catch him! 🏎🏁
Bring him to your pod!🍾🚀🚀🚀
Yes sir…and without all the spammy tactics many others use.
Definitely needs to be on the podcast
Alex the invitation is open whenever you want to come on the podcast! We’re both in Vegas!
I’ve been in construction for over 10 yrs. went off on my own this year for the second time. I’ve already raised my prices twice. Perks of being in a non competitive market. Everyone is busy but not everyone has changed thir prices. I’d rather have less stress from less customers and make more money per job.
Same experience when I had my gym. Lowering my bootcamp price increased my churn. It was a stressful experience because I had to spend more money on marketing. I thought that by advertising a lower price would bring in more clients. That had a negligible effect. Perceived value. If it's a cheap price, then maybe it's a cheap product or service.
I learn more watching alex than school. Appreciate these videos bro
Because alex is practicioner not theoretist like all teachers in school who pretend to know everything but they don't know nothing except knowledge from college :D
@@ourdan14 Facts these teachers don't even own businesses
2:15, 3:33, 7:33
Decreasing price usually doesn't decrease churn instead it just lowers the value associated with the product and lowers profits
2:35
Increase price to what most customers value the product at and it will decrease costs and increase profits and affirm the premium branding
6:09
Ways to increase the lifetime value of a customer in the order of importance (kiosk)
Alex I would say it's one of my mentors, I really try to stay on track with every word you spread. Keep it up brother
I made the mistake of lowering prices when I owned a gym.
Best results I ever got was an 8 week transformation program where I charged 2x my normal package, but included more accountability and supplements
I can’t believe this content is free. We just dropped our prices on a promotion and the results were very similar. Now I know why....
Loving these videos! One of the biggest problems with ANY price change is that business owners often make the change without testing anything first. You need to run an isolated pilot program or test different offers and the results before committing. Testing is the ultimate rule if you want to minimize risk/loss and maximize profits while gaining market intel.
“I highly recommend not doing it” 😂😂
I also made a bad desition, I wanted to lower our costs, so after testing a new provider for over one year, I switched providers. I almost lost all clients who kept calling me all day, for a simple configuration problem the new provider couldnt solve because the new technology was not compatible with most of our clients computers. 3 days later we had to go backto the old provider. I was lucky no client left.
I hope people realize how much most people pay to get information like this.
Hey Alex, if you ever read this please know how much I appreciate your content. Thank you so much!
I literally just said to you my team last week, thank you for the reassurance on not lowering price to increase business, Alex.
As a consumer and not a business owner, I avoid the lowest priced products or services. I lean toward the “you get what you pay for” purchase model. Jimmy Johns> Subway.
I can feel the anguish and frustration in Alex’s voice about losing that $5M. My question is how the hell did he get back to his normal pricing after opening up Pandora’s box?
started selling the old price again and grandfathered all the people i had discounted.
Your channel is gold man.
I'm a smart dude, but you just BLEW MY MIND in
This video cost Alex $5M to make so it's gotta be valuable
I guess in a way, this mean poor people are the worst customer in term of profit/operational complexity. In similar story, I was try to give away my old piano (worth around 5k-10k on amazon) for free since I was getting a new one. People were complaining that I didn't do free delivery of the piano. Learn my lesson, to at least charge $5-$20 buck when you want to give some thing away for free and just not take the money when the receiver arrived. It help as a filter out the high value receiver from high cost receiver where even being free is not enough.
I agree, didn't work for me. Everything stayed the same people who will buy will buy for the value not the price
So good! Love how Alex simplifies such amazing business lessons!! Thank you!
so takeaway is lower your prices when you actually have lower cost base, and make you customer benefit from your incremental margins
I'm a simple man.
When Alex speaks, I RAISE THE PRICES! 💪🔥📈
Alex to the moon. 🚀 reading and listening to the 100M offer on my honeymoon and I’m diggggging it!
Alex, thank you for beautifully explaining that lowering your price is always a race to the bottom.
5:55 - 6 ways to Increase LTV Lifetime Value (from a customer)
Price
Costs
Resells - Get people to buy more of the Same Thing (2x Burgers)
Upsells - Get them to buy something Similar (Bigger Burger)
Cross-sells - Get them to buy something Different (Fries with Burger)
Downsells - Get customers who wont buy to buy something - something small - (Junior Burger)
! When you CUT the PRICE, you MAKE LESS !!!! 99/100x
7:30 - Summary
Why do I love this so much?
How do we get the customers to pay for the ads directly? Serious question. Need help asap. Advertisement is expensive
Hey Alex. Thanks for this video. It saved me $4.6k!
Valuable video, Alex. Always learning so much from you! Lowering your price is rarely a good idea. 👍
Great examples! The concrete examples really help demonstrate how lowering your price doesn't help you out at all really.
Great and easy concepts to understand. I'm so glad you came across my YT feed!
Nice advice! Will definetly be applying this in my business in the future.
Apple definitely believes in this lol. Makes sense why they're a 2 Trillion dollar company.
Learning so much from you Alex! Thanks for giving this for free!
Alex thanks for this. I followed your advice and it increases revenue every time.
Thanks for the lesson teach!!!
Nice one Alex! Another awesome and very helpful video. So happy I found your channel 🙏🏻
I, as well as other people, used to go to a place where they make pancakes and hot dogs. I would buy hot dogs at 2.90 leva. Ever since he increased the prices and the hot dog went to 3.40 leva, I stopped buying and I no longer see people go there.
One of the best videos, straight forward, makes perfect sense
Who is paying 800$/week for workout trainings? Serious question.
Thanks alex
thanks for allowing me to learn from your lessons
Hi Alex, great info thank you. I'm reading the book and note the pricing section about charging a premium to differentiate yourself. What do you think about free / freemium products and how they can meet your model? Thanks, Ollie.
I needed to hear this. Thank you 🌺
Quality content
Another amazing video. 👏
just wow, man the way in which you think is just insane, wow
Ok so what your saying, for example in my detailing business I specialize in paint correction, ceramic coatings and vehicle customization.... but I still sell regular detailing services(vehicle cleaning). Since I truly believe that vehicles with great paint condition, that are protected for longer with the technology in ceramic coatings, I should focus on selling only those services because that is what my passion is?? I would love to do that, but most of my business as of right now is regular detailing. What would you recommend?
Thanks chief
Thanks Alex
Just found your content, super nice. Dropping that algo comment.
Thank you Alex!
I’m watching this after he made his books $19.99 instead of $29.99 lmao. Yes I know it’s not the same but funny.
I love you Alex. Thanks for all you do!
Great stuff Alex! Thank you so much for sharing!
Gold as always Alex! Added this to faves.
GOLD
Good advice! How do you draw like that? What do you use?
doesn't work in used car vehicle sales, trends, demographics and cycles are more of a market determiner, but in service businesses I agree though
Your entire content is gold
Solid counsel!
What happens if you have a service based business where most of your clients are one and done, meaning no LTV? I own a criminal defense law firm where competitor pricing (project based, not hourly), is all over the board.
To add… I’m in a very competitive market, ie lots of lawyers
Dude!!! You're dropping gold on our laps!
Helped a Dentist last month add $60,000+ on her practice. Hoe much do you think is the monthly recurring retainer if I can able to consistently produce this to her?
People don't want more retainers, but if you can consistently deliver value to her, I'd turn it into a process and continue to help her through it, as well as leverage her network to help you help more dentists.
10% seems fair if you continually do that
contradiction in the same video. Did you catch it?
Love these ideas!
I had the same problem when I went out with a cheap ugly broad. Then I switched to a classy beautiful caring woman. Been married for 26 years and she is even better than before. Upsell works.
This shit is so useful I love this channel
Making breathrite strips ok to wear during the day. Lol
this is the type of guy that makes me keep notes when he talks.
Sweet and solid advice.
4:30 what to say
Will it work on em?
just found this guy.....he´s a fucking legend!
great point
A great lesson for life
Thx
Epic content as per usual
amazing video once again! Alex do you record that writing on the right over like an Ipad or something along those lines?
That's harsh. I usually make pr.ices higher, unless I really want to work with a specific client and they ask me for a discount (I'm B2B btw). Noted tho
holy shit this video was amazing
Always value shared here 🔥
Value is off the chain
100%, been there done that, nothing changed except my take home went down...and it takes time to fix too . . . Always on the rise now tho
Super good!!
The master has spoken 🙌🏻
Disney has DEFINIETLY been listening
Your the man alex
This is a great way to see how you can 2x your revenue... the math doesn't lie.
Last math section was wrong I guess. If you gain 40 dollars per customer let's say you have 60 customers . 40x60 = 2400 dollars. But in other way you gain 90 dollars per sale but you'd have 20 customers. That's 20x90=1800 dollars. Maybe I understand that wrong. Idk I just wanted to notify
3/4 the customers at 50% higher prices (2.2x profit) = 150% profit increase with fewer customers
@@AlexHormozi Yeah I got it now thanks Alex. I heard it wrong. Appreciate ya
How do you calculate a 150% increase?
100 customers at $40 profit each = 4000
75 customers at $90 profit each = 6750
Increase: 2750.
2750/4000 x 100= 68.75% increase.
What am i missing here?
@@JarlDuoMusic my bad
I really want to know what that bandaid is for
Powerful
Thank you..needed this. >∆
Yoi are awesome Alex.
Love capitalism but...... I hate greedy business owners that whine about not screwing the customer hard enough
bets guy out there, i have a question i run a farm business with low margin. should i transition to a completely new business model or upsell higher end products through my stream (question is what kind of products?)?cheers
product businesses are a different animal
A lot of potential there depending on what you're doing right now.
I would breaking the categories down and going for one. Once that gets traction going for the next thing. Build it up slowly.
What kind of strip is that? (Not a joke)
Beat me to it! 😂😂
💲💲💲
Greetings from Europe)