If I Had a $4M Business, I'd Build This Creative Engine — Transcript

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1. 0:00Alex Hormozi, I love you.
2. 0:02>> [laughter]
3. 0:03>> I love you, too, man. Let's rock.
4. 0:04>> Uh so, I'm I'm Abram. I uh I have an
5. 0:08easy natural weight loss program for
6. 0:10women online. Uh we do $4.1 million a
7. 0:14year right now, and we'd like to be at
8. 0:18$12 million a year.
9. 0:19>> Okay.
10. 0:20>> Uh
11. 0:21what is stopping me is consistently
12. 0:24filling the sales calendars with
13. 0:26qualified leads.
14. 0:27And if I don't solve this problem, then,
15. 0:30you know, my team can't support their
16. 0:31families, and not hitting my goals
17. 0:33bothers me to no end. Um so, how could I
18. 0:37get more qualified leads on my sales
19. 0:40reps' calendars consistently?
20. 0:41>> Yeah, so they can feed their kids and
21. 0:43not be homeless. What are we doing here?
22. 0:44Great. All right. So, uh primary way of
23. 0:47getting customers right now?
24. 0:49>> Uh it's uh basically 50/50 between Meta
25. 0:52ads and organic.
26. 0:54>> Okay. And is it IG is your
27. 0:57your organic?
28. 0:58>> Uh mostly. Uh it's Facebook and
29. 1:01Instagram for the organic.
30. 1:03>> Got it. It's Meta. All right. So, Meta
31. 1:04organic and then Meta ads for
32. 1:07uh
33. 1:08>> Correct.
34. 1:08>> Yeah, on paid. Okay, got it. Um what's
35. 1:11uh what's price point and what's CAC?
36. 1:15>> My price point is $10,000 for a year
37. 1:19>> Okay.
38. 1:19>> or $5,000 for a downsell for a year.
39. 1:22>> Got it.
40. 1:23>> I'll pull up our cost to acquire a
41. 1:25customer right now.
42. 1:27It is
43. 1:30$1,193.
44. 1:33>> Okay.
45. 1:33>> Cost to acquire a customer.
46. 1:35>> And is that paid or blended?
47. 1:38>> Blended. I don't I don't know how to
48. 1:39separate them anymore ever since I've
49. 1:40been doing paid and organic.
50. 1:42>> Mm.
51. 1:43Okay.
52. 1:44>> it's really hard because like they'll
53. 1:45they'll go through one path, and then
54. 1:47they end up out the other end, you know.
55. 1:49>> I got you. So, 1,100 is blended?
56. 1:52>> 1,100 is blended, correct.
57. 1:54>> Okay, that's not bad.
58. 1:55Okay. Um
59. 1:57all right. And then, you said five and
60. 1:5810K, what's the average ticket?
61. 2:01>> The average ticket is
62. 2:06is 5,087.
63. 2:08>> Oh, so most people go for the five. So
64. 2:10you anchor at 10 and then most people
65. 2:11drop down to the five.
66. 2:12>> Correct. Yeah.
67. 2:13>> Okay. Got it.
68. 2:15All right. Pay for it. Okay. Got it. So
69. 2:18you need to scale your your your demand
70. 2:20gen side. All right. So
71. 2:22>> [sighs]
72. 2:24>> Dude, we lost this tough man.
73. 2:25Um
74. 2:27Uh
75. 2:28>> [sighs]
76. 2:28>> it's tough, man.
77. 2:30The reason it's tough is there's no
78. 2:32revenue retention in the business.
79. 2:36Right? Like after you sell this thing,
80. 2:37I'm guessing they don't buy something
81. 2:38else, do they?
82. 2:40>> Uh yeah, we sell them into our back end
83. 2:42of the community for it. They typically
84. 2:43stay on for two to three more years.
85. 2:46>> Okay. What's the price point of that?
86. 2:48>> Uh that one is like a fourth the price.
87. 2:50We We basically we took the money models
88. 2:52um approach where we Yeah, exactly. So
89. 2:55uh after the first one, we sell them for
90. 2:57basically half the price. So like 2,500
91. 3:00up front and then we they do a monthly
92. 3:01recurring and then they get to keep that
93. 3:03monthly recurring in for as long as they
94. 3:04stay in the program.
95. 3:05>> And what's the price point of the
96. 3:06monthly recurring?
97. 3:08>> Uh it's anywhere from 50 to 150 dollars
98. 3:11a month.
99. 3:12>> it. Yeah, yeah. And so that's where the
100. 3:13churn is super low cuz they pay So what
101. 3:15percentage of people go into the 2,500?
102. 3:17>> into the 2,500. Yeah, but that's a lot.
103. 3:23>> dude.
104. 3:24>> Yeah, and they're they're actually
105. 3:25thanking us on the sales calls now
106. 3:27because they're like, "Oh my gosh, I
107. 3:28cannot believe you're letting me do it."
108. 3:29Cuz we increased the price for our
109. 3:31program by a thousand dollars every six
110. 3:32months. We're very public with it. So
111. 3:34everyone that's in the program already,
112. 3:36they're like, you know, we have people
113. 3:37that joined for three thousand dollars
114. 3:38before and now they're like, "I get to
115. 3:40pay, you know,
116. 3:42>> Yeah, 100 bucks a month for
117. 3:43>> 1,500 dollars plus, you know, 100
118. 3:45dollars a month and they're like, "Oh my
119. 3:46gosh, this is the best thing ever."
120. 3:47>> Dude, I love it. I almost wrote a whole
121. 3:48chapter on it. I love it. Uh
122. 3:50>> [laughter]
123. 3:51>> okay, cool. So we have to increase
124. 3:52demand. I mean, if that if these numbers
125. 3:55are true, which I'm assuming they are,
126. 3:56right? Um if you had a 3-month a 3-year
127. 4:00stick on 100 bucks a month,
128. 4:02uh you've got 10k on the back, right?
129. 4:05Plus the 2500, you got 12.5, plus the
130. 4:0857, right? So, you're you're at almost,
131. 4:11you know, 18,000 in LTV, right? And a
132. 4:13lot of that's margin.
133. 4:15>> Yeah. Yeah, a lot of huge part of it is
134. 4:17margin, yeah.
135. 4:18>> What's margin right now?
136. 4:20On four.
137. 4:22>> On
138. 4:24Oh, like what do what do we take home?
139. 4:26>> Yeah, what's your net?
140. 4:28>> Uh my net for uh crap, I'd have to pull
141. 4:30up the other ones, but um it anywhere
142. 4:33about 120,000 a month I take home for
143. 4:37my what I take home.
144. 4:38>> Oh, a month. Okay, got it. I was like,
145. 4:40what the hell? Okay, got it. So, you're
146. 4:41doing uh 1.4 on four.
147. 4:45>> Yeah. So, that's like the net net. Like
148. 4:47if we're just talking about the
149. 4:49uh net operating costs or things like
150. 4:51that, or you just mean like net that I
151. 4:52take home
152. 4:53>> So, you got So, yeah, so you're at
153. 4:55you're at like 30-ish percent net
154. 4:57margins, somewhere in there.
155. 4:58>> Yeah.
156. 4:58>> Okay, got it.
157. 5:01>> [sighs and gasps]
158. 5:01>> Okay.
159. 5:03So, what happens when you scale your
160. 5:05paid?
161. 5:06>> So, ever since Andromeda hit, it's been
162. 5:09way easier to have profitable ads. Like
163. 5:12it's so crazy because as soon as you put
164. 5:14something up, you spend like $30 and we
165. 5:16get a 5k painful like the next day.
166. 5:18>> Yeah.
167. 5:19>> And then
168. 5:20a week later, it is just hemorrhaging
169. 5:23money. Like and it or the or the lead
170. 5:24quality just goes to [ __ ] like right
171. 5:26away and we have to shut it off. So,
172. 5:29um I'm basically just cranking through a
173. 5:31ton of
174. 5:33like things for
175. 5:35to feed the Andromeda engine.
176. 5:36>> Yeah.
177. 5:37>> And that works to a point, but I can
178. 5:39never seem to scale it up to wherever I
179. 5:41want to get I've never found a I've not
180. 5:42found a true winner in like
181. 5:45>> I feel like a year now. They've all just
182. 5:47been really short cycles.
183. 5:49>> It's because the game has changed.
184. 5:51And so, what you need to build So, this
185. 5:52will be really This will be really good
186. 5:53for a lot of people, not just you.
187. 5:56So, you obviously have the Like when you
188. 5:57have weight loss in the business like
189. 5:58yours, it's all demand, right? And so,
190. 6:01um rather than me say, "Hey, let's make
191. 6:03more better content." I think that that
192. 6:05one seems obvious. Um I think what you
193. 6:08need to build is kind of what I was
194. 6:09talking about from the tax side, but you
195. 6:11need to build this You need to build a
196. 6:13self-licking ice cream cone within the
197. 6:14business that can basically make you an
198. 6:16affiliate army. So, for example, like we
199. 6:19put out
200. 6:20gosh, I'd say collectively probably 500
201. 6:22pieces of creative a day.
202. 6:25And so, you just aren't putting nearly
203. 6:26enough creative out, which means like if
204. 6:28that is the If that is the true
205. 6:30limitation of the business, which it is
206. 6:31right now. Like right now, the thing
207. 6:32that's limiting your business is your
208. 6:33creative. You need more creative.
209. 6:36And so, that means we need to have a
210. 6:37process or a system that creates
211. 6:38creative. And so, my
212. 6:41my curiosity
213. 6:43would be is there a way that we can
214. 6:46create a cycle for your customers to
215. 6:50make
216. 6:51reels and shorts about your stuff and
217. 6:55basically
218. 6:56keep their Instead of paying $100 a
219. 6:58month,
220. 6:59it's like you can pay $100 a month or
221. 7:01you can make me two pieces of content a
222. 7:03week or five pieces of content a week.
223. 7:06>> What does that content look like?
224. 7:09>> Them
225. 7:11You would look at all the
226. 7:13strongest hooks in weight loss. Tell
227. 7:16them what those hooks are. Let them use
228. 7:18those hooks and also make their own
229. 7:19because that's how you discover new
230. 7:20ones.
231. 7:22So, what you need to do So, are you
232. 7:23familiar with TikTok Shop?
233. 7:25>> Yeah.
234. 7:25>> Okay.
235. 7:27You want to create your own TikTok Shop
236. 7:30affiliate system
237. 7:31fundamentally for people to create
238. 7:34creative to promote your thing.
239. 7:37Like this is what will take you from 4
240. 7:38to not 12. Like this will take you to
241. 7:4050.
242. 7:42Like this is the highest point of
243. 7:43leverage in the business for you.
244. 7:46And so answering the question like how
245. 7:47can I get 100 people to make me five
246. 7:49pieces of content a week?
247. 7:51So you get 500 pieces of creative. And
248. 7:54with Andromeda
249. 7:56the algorithm will read number one what
250. 7:58they're saying,
251. 7:59number two what they look like in the
252. 8:01room. And so it will match
253. 8:03>> Mhm.
254. 8:03>> because all Andromeda did, which is why
255. 8:05the ROI is so high, is they just took
256. 8:07the the idea of national ad campaigns is
257. 8:09like gone.
258. 8:10It's all sub-segments because they want
259. 8:12the
260. 8:14they want the process rather they want
261. 8:16the experience for a consumer to be feel
262. 8:20like the algorithm is so catered to
263. 8:21them. Which means that advertisers can
264. 8:23no longer just be like
265. 8:25"Hey, buy my shit." Right? It's like you
266. 8:27have to be like, "Oh, you're just like
267. 8:28me who look like you and talk like me
268. 8:30and you're making those recommendation
269. 8:31now more likely." So marketers love it
270. 8:33and hate it because it's
271. 8:35your experience is 100% what Andromeda
272. 8:37does. You get better ROIs and it burns
273. 8:39out in two days.
274. 8:40And so I just happen to come like the
275. 8:43biggest gift I ever got was I started as
276. 8:44a local business owner. And so I had the
277. 8:47same 100,000 people I could advertise
278. 8:49to. So I had to make [ __ ] loads of
279. 8:51creative before it was cool. So that's
280. 8:53why I I I I I I flexed this muscle a
281. 8:54lot. And so
282. 8:56And it but your needs at your spend is
283. 8:59beyond
284. 9:01Like you're you're going to need
285. 9:04I'll make your target 500 pieces a week.
286. 9:07>> 500 pieces a week from the my clients
287. 9:10just talking about whatever these hooks
288. 9:12are. So if
289. 9:13>> And you split it 50/50
290. 9:15static and
291. 9:16um
292. 9:17uh static and video.
293. 9:19>> Yeah, that was going to be my question
294. 9:20because the uh when I have uh
295. 9:23Andromeda, I have that's exactly what my
296. 9:25split is right now. It's like 50/50 uh
297. 9:27text and images and video. But uh
298. 9:31the messaging has to be 100% unique
299. 9:34between every single creative for it to
300. 9:35crank like that. And I I mean like
301. 9:37literally nothing is the same. Like the
302. 9:40like the entire thing is all of them are
303. 9:42like 100% different. That's why they
304. 9:43crank so much. But so if I have my
305. 9:45clients doing this and they're putting
306. 9:47out this five-piece of content, am I
307. 9:48telling them, "Hey, these are all the
308. 9:50best hooks. Everyone record these best
309. 9:51five hooks
310. 9:52>> They can make the same hooks.
311. 9:54They'll be fine. Yeah, they get to like
312. 9:55they can like if you have different
313. 9:57people saying the same thing, that's
314. 9:58totally fine.
315. 10:00>> Okay, that would still that would still
316. 10:01be okay. What about do I need to worry
317. 10:03about like brand messaging inside of
318. 10:04like what they're saying or it's kind of
319. 10:06like
320. 10:07>> I mean, you can watch them.
321. 10:08>> Oh, no, I mean like like I want to sell
322. 10:10easy weight loss for women. Do I have to
323. 10:12make sure they say that specific thing?
324. 10:14You know, like or do I have to say like
325. 10:16hey, I want to lower my cortisol.
326. 10:18>> Dude, if you can get that past the ad
327. 10:19scraper, if you get easy weight loss for
328. 10:21women working,
329. 10:23amazing. A lot of I mean, you're skating
330. 10:25on thin ice on that one.
331. 10:27>> Yeah.
332. 10:28>> Easy, fast weight loss.
333. 10:30>> [laughter]
334. 10:31>> Yeah.
335. 10:32>> The only thing else you need is free and
336. 10:34you be and you hit you'll hit the
337. 10:35>> [laughter]
338. 10:36>> Yeah.
339. 10:37>> Free, guaranteed.
340. 10:38>> Yeah. Fast, easy, free weight loss.
341. 10:41Uh no, that's what you need to do. You
342. 10:42need to build out the machine. Um and do
343. 10:44you already have um
344. 10:46AI automation set up so that you can get
345. 10:48100 or 200 statics a week just cranking
346. 10:50to you without you doing anything?
347. 10:53>> Uh no, I write out all the copy um
348. 10:56every day.
349. 10:57>> No, dude. No, dude.
350. 10:59>> Yeah. So cuz I I've tried yeah, cuz I've
351. 11:01done the
352. 11:02the AI ones I've done or I guess it's
353. 11:05all testing cuz I don't know. Like some
354. 11:06of the ads I think suck ass and all of a
355. 11:08sudden I put them out and they rock. So
356. 11:11like I don't know what's going to be
357. 11:12good. So if I'm putting out different
358. 11:15like text and imaging things, do you
359. 11:16have like best practices that you guys
360. 11:18have seen work right now where you if
361. 11:20you guys are are you doing like five
362. 11:21different um
363. 11:23image or one image and like five
364. 11:24different copies and then you're doing
365. 11:27advantage creative or anything specific
366. 11:29that you guys are seeing?
367. 11:30>> Dude, we're just cranking so much
368. 11:31variety and then whenever we do have
369. 11:32winners, we add it to the winner the
370. 11:34winner sheet, and then that feeds the
371. 11:36AI.
372. 11:39>> Gotcha. Oh my gosh, why am I not doing
373. 11:42that? All right, I've been I took my
374. 11:43winning emails. You know, I should why
375. 11:45am I not taking my winning ads?
376. 11:47Like All right, so
377. 11:49makes a lot of sense.
378. 11:50>> Good talk.
379. 11:51>> Awesome. All right.
380. 11:52>> [laughter]
381. 11:54>> Appreciate you, Ben.
382. 11:54>> will definitely do this, yeah. Thank you
383. 11:56so much.
384. 11:56>> Yeah, you bet, dude. Rock and roll.
385. 11:58If you're not getting as many leads as
386. 11:59you want in your business is demand
387. 12:01[music] constrained, meaning you could
388. 12:02service more customers than you
389. 12:04currently have, then this is for you.
390. 12:05So, marketing is changing, [music] and I
391. 12:07think ACQ tends to be on the bleeding
392. 12:09edge of this stuff. We certainly spend
393. 12:10the money
394. 12:11to do it, but we also build custom
395. 12:13software, and we pay amazing vendors and
396. 12:15very expensive people to figure out the
397. 12:16system that we have right now, and I
398. 12:17want to share it with you kind of open
399. 12:18kimono style. If you're not getting as
400. 12:20many leads as you want,
401. 12:21boy, do I have the thing [music] for
402. 12:22you. Click below, book call, and
403. 12:24hopefully I'll see you in Vegas.