Win Small Before You Win Big — Transcript

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1. 0:00Let's imagine that you're in the
2. 0:01absolute biggest red ocean, right? Red
3. 0:04ocean being it's super populated,
4. 0:05there's blood in the water, right?
5. 0:09Do you think the business advice niche
6. 0:12is populated?
7. 0:14Do you think there's a lot of red ocean
8. 0:16in business advice?
9. 0:18Yeah, probably.
10. 0:20Right?
11. 0:21And so, should I have not gotten into
12. 0:23this?
13. 0:26The bloodier the water, it means the
14. 0:27more fish are there.
15. 0:29And so, where there's the fiercest
16. 0:31competition, there's also, often times,
17. 0:34the biggest rewards. Now, that being
18. 0:37said, how do we merge this concept with
19. 0:40the idea of you should niche down? Wait,
20. 0:41Alex, I thought you wrote a book that
21. 0:43said, "Hey, the riches are in the
22. 0:44niches," right? So, how do we merge
23. 0:46these two ideas? Let me explain cuz I
24. 0:48get questions about this.
25. 0:50In the beginning,
26. 0:52you want you artificially constrain the
27. 0:54pond that you're going after, so that
28. 0:56you can compete in a place where the
29. 0:59sharks aren't swimming.
30. 1:00Okay? So, you want to be the biggest guy
31. 1:03in a puddle. That's what you want to do.
32. 1:05Biggest guy in a puddle.
33. 1:07And then, you say, "You know what? I'm
34. 1:09going to go from a puddle to a pond,
35. 1:12because I think I'm I'm too big for this
36. 1:13puddle." And so, you grow, and then you
37. 1:15go to the pond. And then, once you go
38. 1:17from the pond, you say, "You know what?
39. 1:18I'm going to go to a lake."
40. 1:20Now, I'm in a lake because I'm a even
41. 1:22bigger fishy, right? Now, I'm in a lake.
42. 1:25And then, eventually, you get to the
43. 1:26point where you say, "You know what? I
44. 1:28think that I'm big enough to go into
45. 1:30open class, open market, and fight in
46. 1:33the ocean."
47. 1:34Now, if we were to look at this
48. 1:35trajectory,
49. 1:37I started as a trainer.
50. 1:42And I talked about nutrition and stuff.
51. 1:44And then, I talked about gym stuff.
52. 1:48And then, I started talking about
53. 1:52business stuff.
54. 1:54So, you're going to have evolutions
55. 1:57where you can get big enough for a pond
56. 1:59that you can move on from the pond to
57. 2:02the lake and the lake to the ocean.
58. 2:05It's just that it's directly correlated
59. 2:07with your skill and your experience. And
60. 2:10so, the reason that the the riches are
61. 2:12in the niches is that when you're there,
62. 2:13number one, you're competing against
63. 2:14fewer people. And so, the upside is
64. 2:16capped typically. Now, it's usually
65. 2:18capped at way higher than you think it
66. 2:19is, but it is capped to a degree.
67. 2:22And that's okay. But, as a result,
68. 2:24because we are niche down, we're able to
69. 2:25charge niche prices, which give us more
70. 2:27profit, more pricing power cuz there's
71. 2:29fewer people There's fewer things to
72. 2:30compare you against, right? And so,
73. 2:33there does come a time where you can go
74. 2:35uh move the market, right? Move your
75. 2:37market, rather, um to go after a
76. 2:40different segment or a broader segment.
77. 2:42So,
78. 2:43let me walk walk through what you can
79. 2:45how to think through this evolution for
80. 2:48a business.
81. 2:49So, let's say that your current business
82. 2:52is this little dot here, okay?
83. 2:55There are five directions that we can
84. 2:57move with this dot. We can go So, let's
85. 2:59imagine this is a
86. 3:01We've got a triangle of a marketplace,
87. 3:02okay? So, this is where you This is
88. 3:04where you inhabit.
89. 3:05You can go up market.
90. 3:08All right? So, for example, um
91. 3:10in my gym launch days, I could, instead
92. 3:13of serving single location fragmented
93. 3:15gym owners, I could go to franchisors,
94. 3:18right? Multi-location owners
95. 3:20and franchisors. So, I have one-off gyms
96. 3:23here.
97. 3:24Now, the next direction, so this is
98. 3:25direction number one I can do.
99. 3:27Direction number two
100. 3:28is I can go down market, which would be
101. 3:31that I could go after trainers.
102. 3:33There's way more trainers, they have way
103. 3:34less buying power, but there's a lot of
104. 3:35them. There's fewer franchisors than
105. 3:37there are gyms, and there's fewer
106. 3:39uh and there's fewer gyms than there are
107. 3:40trainers.
108. 3:41Pyramid, right? So, that's the second
109. 3:44thing we can do.
110. 3:45The next thing we can do is we can go
111. 3:47adjacent.
112. 3:49So, instead of gyms, I say, "You know
113. 3:51what? I think I can help." Chiros.
114. 3:56That's what I think I'm going to do. I'm
115. 3:57going to take my systems and I'm going
116. 3:58to chiropractor. That'd be an adjacent
117. 4:00market.
118. 4:01I could also go broader, right? Which
119. 4:04would mean that I would look at this
120. 4:06way.
121. 4:08Which means instead of gyms, maybe I
122. 4:09talk about health and wellness in
123. 4:11general. And so that means that I could
124. 4:13go after chiros,
125. 4:16med spas,
126. 4:18anybody, you know, weight loss clinics.
127. 4:21Oops.
128. 4:25All of these things are now broader.
129. 4:28Or
130. 4:29I can go
131. 4:31narrower.
132. 4:32So, instead of gyms, I say, "I'm only
133. 4:35going to work with spin studios. I'm
134. 4:38only going to work with dancing
135. 4:39studios." So, this is our
136. 4:43fifth. This is our fourth. This is our
137. 4:45third. So, that gives you five
138. 4:48directions that you can go in to change
139. 4:51the direction of the market that you
140. 4:52choose to play it. Now, I outlined this
141. 4:55and what's interesting is that most
142. 4:56people who are especially small business
143. 4:57owners have never even defined this to
144. 4:58begin with and they pretty much just
145. 4:59accept people's money as long as they
146. 5:01have a pulse and a credit card. There's
147. 5:03obviously two requirements. Well, let's
148. 5:04say pulse is optional as long as they
149. 5:05have a credit card. Kidding. Um
150. 5:08that that uh
151. 5:10that they accept. But, the thing is is
152. 5:11that like you want to get really, really
153. 5:13clear on this
154. 5:14um because if you don't, your customers
155. 5:17will be confused because they won't know
156. 5:19what you're really about.