$100M Offers by Alex Hormozi (Summary)
I rarely do book reviews. But occasionally a book comes along that’s so mind-blowing, I just have to share it with people. $100M Offers by Alex Hormozi is one of those books.
In this article, I’ll summarize the book, share my highlights and notes from each section, and give my final review at the end.
But first - click the button below to get an interactive, mind-map version of this post:
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Summary
The book’s subtitle does a pretty good job summing it up : “How to make offers so good people feel stupid saying no.”
Everyone wants to know how to get more leads. But a lot of business success comes down to improving the product or service you provide. $100M Offers shows entrepreneurs how to increase the value (actual and perceived value) of what they offer.
More value means more demand. More demand means higher prices. And higher prices means more profit.
In order to do this, Hormozi recommends creating a “category of one” for your business. Books like The Blue Ocean Strategy and 22 Immutable Laws of Marketing cover similar ground. But Hormozi goes beyond the philosophical by giving specific recommendations about choosing a market, breaking down what value actually means, and going deep into bonuses and guarantees.
Book Notes
I had 10 big takeaways from the book - here are my notes and highlights for each:
1 - Grand slam offers ⚾️
The offer is the key to selling because you need to believe in what you are selling. If you don't believe in what you're selling, you will self-sabotage.
"if there is a ton of demand for a solution, you can be mediocre at business, have a terrible offer, and have no ability to persuade people, and you can still make money."
"let’s start by defining a Grand Slam Offer. It’s an offer you present to the marketplace that cannot be compared to any other product or service available, combining an attractive promotion, an unmatchable value proposition, a premium price, and an unbeatable guarantee with a money model (payment terms) that allows you to get paid to get new customers . . . forever removing the cash constraint on business growth. In other words, it allows you to sell in a “category of one,”
"Grand Slam Offer: Pay one time. (No recurring fee. No retainer.) Just cover ad spend. I’ll generate leads and work your leads for you. And only pay me if people show up. And I’ll guarantee you get 20 people in your first month, or you get your next month free. I’ll also provide all the best practices from the other businesses like yours."
Example for an ad agency
"Pay one time. (No recurring fee. No retainer.) Just cover ad spend. I’ll generate leads and work your leads for you. And only pay me if people show up. And I’ll guarantee you get 20 people in your first month, or you get your next month free. I’ll also provide all the best practices from the other businesses like yours."
2 - Find a starving crowd 🌭
Hot dog stand story: a marketing professor asks the class what one advantage they would want if they were opening a hot dog stand. It’s not a higher quality hot dog, a nicer cart, etc. It’s a starving crowd.
"Starving Crowd (market) > Offer Strength > Persuasion Skills"
"At the end of the day, if there is a ton of demand for a solution, you can be mediocre at business, have a terrible offer, and have no ability to persuade people, and you can still make money."
"There is a market in desperate need of your abilities. You need to find it...Don’t be romantic about your audience. Serve the people who can pay you what you’re worth."
"This entire book sits atop the assumption that you have at least a “normal” market, which I define as a market that is growing at the same rate as the marketplace and that has common unmet needs that fall into one of three categories: improved health, increased wealth, or improved relationships."
Four indicators of a good market:
1) Massive Pain
"They must not want, but desperately need, what I am offering."
"The degree of the pain will be proportional to the price you will be able to charge"
2) Purchasing Power
Example of person helping unemployed people as a career coach
Tweet from Hormozi: "Solve rich people's problems. They pay better."
3) Easy to Target
"I make my life easier by looking for easy-to-target markets. Examples of this are avatars that have associations they belong to, mailing lists, social media groups, channels they all watch, etc."
4) Growing
"if I were a relationship expert trying to find my avatar, I’d rather focus on “second half of life relationship” coaching for old timers than helping college students in relationships. Why? Because senior citizens who are alone are likely suffering more pain as they are nearer their deaths (pain), have more buying power (money), and are easy to find (targeting). Lastly, at the time of this writing, there are more people turning 65 each year than turning 20 (growing)."
3 - The grass isn't greener 🌱
"All businesses and, all markets, have unpleasant characteristics. The grass is never greener once you get to the other side."
"I have a saying when coaching entrepreneurs on picking their target market “Don’t make me niche slap you.” Too often, a newer entrepreneur half-heartedly tries one offer in one market, doesn't make a million dollars, then mistakenly thinks “this is a bad market.” Most times that’s not actually the case. They just haven’t found a Grand Slam Offer yet to apply to that market."
"For most, if you are under $10M per year, niching down will make you more money."
"You want to be ‘the guy’ who services ‘this type of person’ or solves ‘this type of problem.’ And even more niched ‘I solve this type of problem for this specific type of person in this unique counter-intuitive way that reverses their deepest fear.”
"That’s why a fitness program for generic weight loss might be priced at only $19 while a fitness program designed and marketed only to shift-nurses might be priced at $1997….(even though the core of the program is likely similar - eat less, move more)."
"If you find a crazy good market, ride it, and ride it hard. And if you pair a Grand Slam Offer with a crazy market, you’ll likely never need to work again (seriously)."
4 - Make it an expensive bargain 💰
Charge more, offer more. The reverse doesn't work. Trying to create a bargain by charging less = race to the bottom (Seth Godin)
"the goal is to be so much higher that a consumer thinks to themselves, “This is so much more expensive, there must be something entirely different going on here.”
"Those who pay the most, pay the most attention."
The more you charge, the better results you can help your clients get (credit: $100M Offers)
"outwork your self doubt."
"Experience is what gives you the conviction to ask for someone’s entire year’s salary as payment. You must believe so deeply in your solution that when you look at yourself in the mirror at night, alone, your conviction remains unshakable."
"In a real way, we were charging on a fraction of what our clients made using our system. This is important. Our clients still got a deal. The gap between what they paid (price) and what they got (value) was massive. As a result, the virtuous cycle continued to spin. We charged the most money. We provided the most value."
"you should never charge more than your product is worth. But you should charge far more for your product and services than it costs to fulfill."
5 - Reduce time and sacrifice ⌛️
Value equation: This is what made Hormozi blow up
Value equation: This is what made Hormozi blow up (credit: $100M Offers)
#1 Dream Outcome (Goal = Increase)
"People generally, and our clients specifically, want: . . . To be perceived as beautiful . . . To be respected . . . To be perceived as powerful . . . To be loved . . . To increase their status"
"In general, the dream outcome that most directly increases a prospect’s status will be the one they value most."
"Talk in terms of things your prospect believes will increase their status, and you will have your prospects drooling."
"When writing copy, you can make it that much more powerful by talking about how other people will perceive the prospect’s achievement."
"Example: If you buy this golf club, your drive will increase by 40 yards. Your golf buddies' jaws will drop when they see your ball soar 40 yards past theirs . . . they’ll ask you what’s changed . . . only you will know."
"I wasn't selling my membership anymore. I wasn’t selling the plane flight. I was selling the vacation. When you are thinking about your dream outcome, it has to be them arriving at their destination and what they would like to experience."
#2 Perceived Likelihood of Achievement (Goal = Increase)
"we must communicate perceived likelihood of achievement through our messaging, proof, what we choose to include or exclude in our offer, and our guarantees (more on these later)."
#3 Time Delay (Goal = Decrease)
"We want clients to have a big emotional win early (as close as possible to their purchase). This gives them the emotional buy in and the momentum to “see it through” to their ultimate goal."
"it takes a while to add an extra $239,000 per year to a gym. But that’s what they’re buying. So, once they have purchased, we need to create emotional wins fast. One way we do this is to get their ads live and get them to close their first $2,000 sale within their first seven days."
"For a weight loss customer, we would get them to meet someone else so they immediately had some social benefits from the program, and we usually gave them a more aggressive diet in the beginning."
#4 Effort & Sacrifice (Goal = Decrease)
"This is why when you sell fitness, you have to spend an hour arm-wrestling a client to give over 1/10th to 1/100th of the amount of money they pay for surgery."
"In an ideal world, a prospect would want to simply “say yes” and have their dream outcome happen with no more effort on their behalf. This is why “done for you services” are almost always more expensive than “do-it-yourself” because the person doesn't have all the effort and sacrifice."
"that is why Xanax is a multi-billion dollar product while I know of almost no multi-billion dollar meditation businesses . . . value."
"This is also the reason that the supplement industry ($123B, Grandview Research) is twice the size of the health club industry ($62B, IHRSA). They both accomplish the same perceived objectives — “being healthy,” “losing weight,” “looking good,” “increased energy,” etc. — but one is perceived as more valuable because it has lower “costs.”"
"You can either be right or you can be rich."
"In the beginning of my career, I focused all my attention on dream outcomes and the perception of achievement (social proof, third-party edification, etc). In other words, the top side of the equation. That’s where beginner marketers make bigger and bigger claims. It’s easy, and it’s lazy."
"The harder, and more competitive, are the Time Delay and Effort & Sacrifice. The best companies in the world focus all their attention on the bottom side of the equation. Making things immediate, seamless, and effortless." (Amazon)
"if you can reduce your prospects' true time delay to receiving value to zero (aka you realize your immediate dream outcome), and your effort and sacrifice is zero, you have an infinitely valuable product. If you accomplish this, you win the game."
"a prospect would (in theory) purchase something from you, and the moment their credit card was run, it would immediately become their reality. That is infinite value. Imagine clicking the purchase button on a weight loss product and instantly seeing your stomach turn into a six-pack. Or imagine hiring a marketing firm, and as soon as you sign your document, your phone begins ringing with new highly qualified prospects"
6 - Perception is reality 🚆
"The Grand Slam Offer only becomes valuable once the prospect perceives the increase in likelihood of achievement, perceives the decrease in time delay, and perceives the decrease in effort and sacrifice."
"A prime example of this happened in the London tunnel system. The biggest increase in rider satisfaction (aka value) was never from faster trains to decrease wait times. Instead, it was from a simple dotted map that showed them when the next train was coming and how long they had to wait."
"Logical solution: make trains faster to increase satisfaction Psychological solution: decrease the pain of waiting by adding a dotted map"
7 - List all the problems ✏️
"You must resolve every obstacle a buyer believes they will have to convert the highest amount of people. That’s not to say that if you don't, you won’t sell people. Not at all. But you won't sell as many people as you otherwise could have."
Then find a way to solve every problem as cheaply as possible
"What could you do that someone would immediately say, “All that? Seriously? Yes, I'm in.”"
"Don’t get romantic about how you want to solve the problem. Find a way to solve every problem a prospect presents with."
Grocery shopping list example
"The trick, and the ultimate goal, is to find a sweet spot where you sell something very well that’s also easy to fulfill."
"If you think you can accomplish the same value with a lower cost alternative, then do that instead."
"If there’s one type of delivery vehicle to focus on, it’s creating high value, “one to many” solutions. These will be the ones that typically have the biggest discrepancy between cost and value." (think group vs. 1-1 coaching)
"These types of solutions require a high, one-time cost of creation, but infinitely low additional effort after."
8 - Make them beg for it 🤑
"People want what they can’t have. People want what other people want. People want things only a select few have access to."
"if we seek to increase the demand (or desire), we must decrease or delay satisfying the desires of our prospects. We must sell fewer units than we otherwise can."
What does your full roster actually look like? Have less room than you have leads
"When demand increases, cut supply."
"it’s better to sell out consistently than over order and fail at creating that scarcity."
"When using this tactic, you must also let everyone know that you sold out. That is part of what makes it work so well. This way, even people who were on the fence, when they see that it was sold out, it gives social proof that other people thought it was worth it."
True scarcity means being the only one who can solve their problem
"There are many people who can solve the problem: how do I make $10,000 per month? But far fewer who can solve: How can I add $5M in profit without adding any extra product lines to my business?"
"Specialized consultants are paid millions of dollars to solve problems worth tens of millions to clients. The client pays for all the experience and expertise the expert has and avoids the cost of errors (time and money). In short, they skip the bad stuff and go straight to the good stuff more quickly and for less money than it would cost to figure it out on their own."
"You can try and fake it, but there is a special type of “0 fucks given” vibe that’s hard to replicate when you truly do not need a person’s money (or even want it)."
Ways to create scarcity
"Total Business Cap - Only accepting….X Clients. Only accepting X clients at this level of service (on-going). This puts a cap on how many clients you service but also keeps them in it. You create a waiting list for new prospects."
"Growth Rate Cap - Only accepting X clients per week (on-going) “We only accept 5 new clients per week and we already have the first 3 spots taken."
"Cohort Cap - Only accepting….X clients per class or cohort."
"Once You’re Out, You Can Never Come Back You can create scarcity by also capping your service level and saying that if they leave than can never return. This type of scarcity makes people think extra hard about leaving."
"if you want to immediately make a lot of money, create a very exclusive service level based on access to you (yes, unscalable), that you cap at a tiny number. Price it very high. Then, tell people. You will make more money than you thought possible. These also tend to be some of the best clients. And limit your delivery to something that you don’t hate. For me, I hate emails and messages but dont mind zoom calls. Make it work for your working style. The cream of the crop (the 1% of 1% will adjust and take action)."
You can also use urgency
"Never raise your prices without letting people know. It shows a position of strength and will give you a nice little influx of cash from the people in the pipeline who were on the fence."
"In a digital setting, having actual sign up date countdowns is very useful. But make sure they are real. If they aren’t, you’ll lose credibility and just look like every other wannabe marketer."
"The biggest sales on a week long campaign or launch happen in the last 4 hours of the last day (up to 50-60%)."
9 - Break the offer out into bonuses 🧰
"a single offer is less valuable than the same offer broken into its component parts and stacked as bonuses (see image)."
Knife example from old infomercials - buy one knife for $37 and then get 20 knives and a sharper for free
"Whenever trying to close a deal, never discount the main offer. It teaches your customers that your prices are negotiable (which is terrible). Adding bonuses to increase value to close the deal is far superior to cutting prices. It puts you in a position of strength and goodwill rather than weakness."
"When selling one on one, you ask for the sale first, before offering the bonuses."
"Tools & checklists are better than additional trainings (as the effort & time are lower with the former, so the value is higher. The value equation still reigns supreme)."
10 - Get creative with your guarantees 👩🎨
"Reversing risk is the number one way to increase the conversion of an offer. Experienced marketers spend as much time crafting their guarantees as the deliverables themselves. It’s that important."
"You must always hit your guarantee hard, even if you don't have one. Say it boldly and give the reason why."
"If you have a tremendous amount of cost associated with your product or service, you will likely want to employ a conditional guarantee or an ANTI guarantee, as you will have to eat the cost of the refund AND the cost of fulfilling."
"While guarantees can be effective sellers, people who buy because of guarantees can become very shitty customers. A person who only buys because of a guarantee is a person who may not be willing to put in the work necessary to see success with your product or service. In a world where you want to reverse risk and get customers the best outcome possible, tying your guarantee to the things they need to do to be successful can help all parties."
Conditional service guarantee - you keep working with them for free until x is achieved (his favorite guarantee)
"Conditional guarantees include “terms and conditions” to the guarantee. These are the ones you can get VERY creative on. In general, you want these to be “better than money back” guarantees. Because if they are going to make an investment, you want to match their investment psychologically with an equal or higher perceived commitment. These also can have a very powerful effect on getting clients results."
"My advice: Start selling service-based guarantees or setting up performance partnerships. This will make all sales final (so no fear from refunds). Most importantly, it will commit you to your customers’ results and keep you honest."
"If you know the key actions someone must take in order to be successful, make those part of the conditional guarantee. In a perfect world, 100% of your customers would qualify for a conditional guarantee, but will have achieved their result, and therefore will not want to take it."
Anti-guarantee - all sales are final: "this is a very powerful thing that once seen cannot be unseen, or once used cannot be taken away."
"Anti-guarantees can also work very well with high ticket products and services that require a lot of work or customization. “If you're the type of customer who needs a guarantee before taking a jump, then you are not the type of person we want to work with. We want motivated self-starters who can follow instructions and are not looking for a way out before they even begin. If you are not serious, don’t buy it. But if you are, boy are you going to make a killing."
Lots of other guarantee examples in the book (e.g. delayed second payment)
"Unconditional satisfaction-based money back guarantees work better in low ticket B2C situations, it becomes very risky in higher costs of fulfillment."
"The higher the ticket, and the more business oriented, the more you want to steer towards specific guarantees."
"Bad Example: We will get you 20 clients guaranteed. Better example: You will get 20 clients in your first 30 days, or we give you your money back + your advertising dollars spent with us."
"like bonuses, you can actually stack guarantees. For example, you could give an unconditional 30 day no questions asked guarantee then on top of that give a conditional triple your money back 90 day guarantee."
Jason Fladlien: "But you can’t make this decision right now for the same reason you don't buy a house without first looking at the inside of it. And know this...whether it’s 29 min or 29 days from now...if you ain’t happy, I ain’t happy."
Name your guarantee something cool
Generic example: 30 day money back guarantee
Creative example: In 30 days, if you wouldn't jump into shark infested waters to get our product back, we will return every dollar you paid
My client Gemma Gilbert: “Love it or leave it guarantee”
You can guarantee only the upfront payment plan to incentivize that option
"The key is to identify a client’s biggest fears, pain, and perceived obstacles. “What do they not want to have happen if they pay you? What are they most afraid of?” Reverse their fears into a guarantee. Think of the time, emotion, and outside costs associated with any program or service. The more specific and creative the guarantee is, the better."
Review
I can’t recommend this book enough. It’s probably one of my most highlighted books ever. But it’s not just me - check out the reviews it’s gotten from other people:
Goodreads: 4.61/5 (10,897 reviews)
Amazon: 4.9/5 stars (22,280 reviews)
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