The Oh Sh*t Moment (ALEX HORMOZI)

Summary

• Gym owners hoping to reopen after restrictions may face fewer returning customers than expected, leading to a slower recovery.
• People prioritize convenience, which is evident from the shift to on-demand services like Netflix over traditional options like Blockbuster.
• Forced adoption due to the pandemic has accelerated the acceptance of online services, including fitness.
• Some companies may not rehire all laid-off employees after the pandemic, affecting gym memberships.
• Now is the time to shift focus from being a gym owner to being a business owner, especially if the goal is maximizing income.
• Online training allows for a wider market reach beyond the local community, resulting in cheaper leads and higher potential income.
• Remote gyms are currently seeing a higher lead conversion rate due to being able to engage more prospects, even over the phone.
• Online fitness businesses can break even on the first transaction with the possibility of high back-end margins.
• By expanding target radius to 25 miles, lead flow increases substantially, offering more opportunities to reach potential clients.
• With upfront investments in ads, a gym owner can build a significant online income in 30 days, assuming average performance.
• Selling remote services allows for increased flexibility and adaptability in uncertain times.
• Learning to sell over the phone is a crucial skill for gym owners, which will benefit them even when they return to in-person operations.
• The adoption of online training is likely to continue due to its convenience, and businesses should adapt to this trend.
• High-profit margin and low-overhead business models will likely be more successful in the post-pandemic economy.
• Action should be taken now to prevent being caught off guard by the market's rapid changes and to capitalize on the current opportunities in online fitness.

Video

How To Take Action

I would suggest shifting your focus from being a gym owner to a business owner if your goal is to maximize income. Here's what you need to do:

1. Go Online: Start providing online training, which lets you reach a wider market beyond just your local community. It's a great way to get cheaper leads and potentially higher income.

2. Increase Your Target Radius: By expanding your target radius to 25 miles, you can increase your chances of getting more clients. More area means more people you can sell your services to.

3. Boost Online Presence: Invest a little in ads if you can. This could help to build significant online income in about 30 days, based on average performance.

4. Improve Phone Sales Skills: Learn how to sell over the phone. This skill is crucial now and will still be handy when you return to in-person operations. Selling over the phone will help you engage more prospects.

5. Adapt and Stay Flexible: Selling remote services allows you to be adaptable. The world is changing fast, and online fitness is likely to continue growing.

6. Action Steps:

• Start recording workout videos and create digital fitness programs.
• Set up a way to manage your clients and track their progress online.
• Begin promoting your online services through social media and ads.
• Practice phone sales conversations, maybe even role-play with a friend.
• Focus on creating a high profit-margin and low-overhead business model.

Remember, convenience wins and people are getting used to online services. Don't wait for things to "get back to normal." Take action now and start selling remote fitness services. It's an awesome opportunity to grow and you don't want to miss out.

Quotes by Alex Hormozi

"Humans don't want to think of bad case scenarios, and so we rationalize that we don't need to change"

– Alex Hormozi

"People will always choose convenience"

– Alex Hormozi

"If you can sell over the phone you convert a high percentage of leads, always"

– Alex Hormozi

"Make decisions with math, not your emotions"

– Alex Hormozi

"Convenience and speed always win with humans"

– Alex Hormozi

Full Transcript

good morning everyone happy monday i hope you guys are had a good restful weekend or maybe not hope you were not resting at all just selling tons of people into remote fitness over the weekend um and hopefully you were um but if you were not then this message is for you so i'm calling this theo [ __ ] moment i was having a conversation with a friend of mine um who's uh in the same space as us and uh he was talking to me about some of the beliefs that he's getting over the phone um with some of the gym owners that he's talking to etc and it was kind of interesting because he was saying that you know these things change week to week um but he said right now everyone's in denial phase he said right now they're in the phase of i'm gonna i'm gonna hold out i think i can wait a couple more weeks for this to be over and i guess i'm here to say that i don't think that's going to work out for you and here's here's why i don't think sitting and waiting is going to work out for you and hoping that when you open your gym it's going to work out i'm calling this the oh [ __ ] moment because right now i think that there's still a certain sense of hope right i think that when they turn the lights back on when they turn the economy back on when they let jim's back which by the way will be last but when they let us go back to business and open our doors you're going to open your doors and i think a lot a lot fewer people are going to come back than you think um and i think that what's going to happen is going to be a slower recovery than most people anticipate because people are still weary etc and i think some people will just like always uh like there's a reason the on-demand economy is the on-demand economy right everyone thought that people i was literally it's so funny i had an internet troll yesterday or two days ago who commented on an ad and literally just saying stupid things uh like stupid like trying to be smart but saying stupid things uh and he was like as soon as online fitness uh as soon as the gym is open back up all this online fitness stuff is gonna go away and i was like really you think that people are just going to choose a less convenient option after they come back he's like well people really value the in person you know blah blah blah right people said the exact same thing about blockbuster against netflix they're like the ceos of blockbuster because it's so easy to rationalize our like human beings don't want to think of bad case scenarios and so we rationalize that we don't need to change right and so blockbuster executives when they were like hey are you concerned about this online streaming stuff they were like no people will always value making a night making an evening going and picking up you know picking out their movie walking inside and getting their candy like it's become an experience and so we think that people will continue to value this experience guess what they were [ __ ] wrong people would rather just click on the couch and do nothing right is the experience of being at your couch better than the experience of shopping at blockbuster i would say no i really miss blockbuster a lot of times but i didn't miss enough to not use netflix or use netflix way more right and so the reality is that people will always choose their convenience and i think what happened very like recently or currently right now is that a huge piece of the marketplace that never otherwise would have tried online training or maybe would have in the next decade it took all of the remote services and dr dragged it 10 years into the future in terms of mass adoption it was forced adoption all right and so i think a large percentage of people are going to say a larger than most gym owners anticipate are going to stay in a remote setting right i think a lot of people are still like their jobs here's the others oh [ __ ] moment is that people some of the companies that did layoffs may not re-hire everyone right because the demand is not going to be what it was at the single greatest moment in economic history i mean like the best economy ever that happened before this and so just like the oh [ __ ] moment is going to be when you turn the lights on and people don't show up right which transparently will be great for me because i'm just going to mark the [ __ ] out of the gyms that want to work with us because like that will be when marketing is more important than ever because you're going to have to differentiate and get your name out there more than anyone else is right um but let's rewind the clock real quick what do you need to do now right what do you need to do now because the airship moment will come now some people have have stronger communities than others right and i always want to put my disclaimer for good operators right if you're an amazing operator and you haven't lost anyone then you'll probably recover better than people who have lost people right because you have a stronger community you have more boarding coaches you have a better culture etc right um but what should you do now so it is my belief and just looking at the math i'm going to do this big presentation for gym lords don't worry uh i did a huge statistical model looking at uh the difference between roi on remote versus roi in person and the question is whether or not you want to be a business owner or a gym owner and that's a very real question like super super real that's a personal question right but if you're in this to maximize making money because i've had tons of gyms who flew out during our vip days and said alex i want to make a million dollars a year and i said it's not going to happen in one gym right now talking heads of gurus will be like you can totally like show me the [ __ ] bank statement all right and then i'll and then i'll believe you right but no i like it's not from one facility unless you have a massive massive facility and typically group training personal training set will be only a part of that right like if you have 6 000 members paying 100 a month like lifetime then sure you can make a million dollars here right but most people didn't invest 5 million dollars into their build out right so it's understanding relative scope okay so in my belief there is no way better than right now to for the best operators to be able to build a million dollar income business two three four million dollar top line business because one we're we're marketing a 25 mile radius and seeing zero decrease in sales percentages all right number one number two our remote gyms right now are closing a higher percentage of leads than they did in person that's a function of one major thing is that they're getting 40 percent of their leads onto it into a sales conversation compared to 20 you know whatever they were doing before all right so they have twice as many at bats and so even if they're not as good on the phone they're not twice as bad over the phone right and so they're a little if you look at right now the average closing percentage is 29 so they're closing 29 over the phone they were closing 42 in person all right but if you get twice as many at bats you actually still net more sales and so number one you can have a bigger geographic radius so the many people that i've talked to says like i want to have a bigger impact here's how you have a bigger impact you can go remote and help people are not in your neighborhood number two lead costs are cheaper not because of the ads the the ad impressions and stuff because that's temporary right um we've already seen it go back to normal so the at the cost per impression is has gone 100 back to normal since two or three weeks ago all right people are advertising you um but it's because when you draw from a bigger radius you get cheaper leads that's just period if you run a an ad nationally it's just as like challenge or whatever you'll get you know 25 cent leads the issue is how do you create trust how do you create a sale or trustworthy environment for a lead to opt in and then buy something on the first phone call right and that's where having um i would consider like the semi-local appeal automatically gives you gives you one or two trust points in your direction which is allowing us to make sales on these first calls but if we're looking at it purely from a math perspective which i would urge you to be a business owner not a gym owner for the moment right now our guys are essentially breaking even on the first transaction right now they're used to making two to one three to one four to one etc on their first transaction right but you are limited by your your capacity to fulfill in terms of how many people you can have at each time you're limited by your lead flow because let's be real like lead flow of a 25 mile radius is always going to be higher and cheaper than in a 5 mile radius because it's quadratic right so if you have a 5 mile radius and then you go from 5 to 10 you didn't double the amount of people that you saw you pied it right so 3.14 whatever the math is but it's basically let me put in layman's terms if you have a 12-inch pizza and you have a 24-inch pizza a 24-inch pizza is not twice as big as a 12-inch pizza you can fit like four 12-inch pieces inside of a 24-inch pizza because that's how circles work with with with it's called quadratic expansion but anyways um and so when you go to a 25-mile radius you're talking 10 times you know i mean the amount of people that you would be reaching otherwise or 20 or 50 or whatever the math is and so because of that you can have a much bigger reach help more people cons like anybody who's ever struggled with lead flow that doesn't have to happen anymore like you don't have to struggle with lead flow anymore because it's literally enormous and you pretty much can always get lead flow if your target is big enough all right and so putting all these things together cheaper leads bigger geographic radius consistent lead generation a consistent 11 of leads closed which is what we're seeing right now which is higher than most people do in person breaking even on the front end and having 80 percent uh gross margin on the back end like you're talking about spending you know right now if you spend fifteen hundred dollars you'll make six thousand dollars in front end revenue in 30 days that's what the math is right that's the average all right that's the average okay 1500 that's 6600 is the actual number uh of upfront cash in the first 30 days for an online business you know many people have tried to start an online business too many online business gurus there are and the reason they don't have an agency set up or whatever is because they can't guarantee an outcome right they only tow the one or two testimonials that they have of the hundreds of students they have all right i'm giving you the average numbers average average for online so if you wanted to make a six-figure income all right it would take you 30 days to build a recurring revenue stream if you spent uh uh if you spent fifteen hundred dollars it would take if you spent fifteen hundred dollars you closed thirty thirty nine so let's just bump it to make it conservative so if you spent 2 200 in ad spend over the first 30 days you'd be able to have 50 people in your online remote uh business after you lost 44 for not going into continuity all right so i'm accounting for that that you only convert 60 into continuity at 200 bucks a month right that's a 10 000 a month business remote and you can do it in 30 days like averages if you're average you can do it in 30 days right now and so the big question that you have to ask is one am i holding out for what's gonna happen that i don't know about because you don't know what's gonna happen i don't either that's just my guess but like you don't know what's gonna happen but what i can tell you is the opportunity is there and so in the next 30 days in the next 60 days if you wanted to build yourself a six figure or multi-six figure online income you could do it i know that a lot of my gym lords won't do that they're gonna go back to the gyms and that's fine i'm here to serve i'm here to provide whatever value the community that i have asked for but if i were an enterprising [ __ ] which i am i would be strongly considering this it has been very difficult for me to not throw my hat back into the ring and start sonic fitness at large because when i see those types of numbers in terms of acquisition i was like hmm how many sales guys we got i was like i wonder if i i was like i wonder if there's a bunch of gym owners who went out of business so i could just hire to become sales people because when i see that kind of stuff three to one four to one up front you know what i mean ten to one at thirty days ten to one at sixty days sixty days like in gym launch i lose money the first thirty to sixty days right and like i'm just i just know the math game right i'm just willing to make decisions with math if you are able to make decisions with math right now and not let your emotions and not let your fear and not let your discomfort around learning a new skill which is selling over the phone this is the only thing you have to do that's it as long as you acquire that skill set which by the way will set you up better for when you get back to the gym because if you can sell over the phone you convert a high percentage of leads always right if you can just learn that skill you can have an online business simple as that right now and i hope and i and i think my hunch is that that buying behavior will not change people will be now the mass market has been introduced to what online training is like most people don't even know what it was now they know what it is all right and so that that like you're underestimating how big of a deal it is for them to even recognize that industry all right and so one people will now know what online training is number two they will be comfortable more comfortable buying in a remote setting here appreciate over the phone yeah this is after the lights get turned back on because you're like well i don't want to change things you know temporarily because something you know when what happens when you go later what if you have a business that just cash flows later and then you have your gym because many people like uh i won't even get into it but over the phone you would just say yeah you know when covert happened we started doing our first consults over the phone and it ended up just being more convenient for people so we just stuck with it anyways so what's your name why'd you click on the ad right like you can just preface the the sale and then everything else flows like normal right because this has given us the biggest reason of all time the biggest why am i remote why are you doing this over the phone why are we doing this online it has now given everyone permission to have that reason that we never had before right and educated like thank you to the government for educating all consumers on online and remote setting fitness right thank you to the news thank you to everybody for helping us out all right so i say this to say uh i think that for everyone who's holding out and waiting i don't think that's a smart decision um i don't want to be right but i think i probably will be um i think a lot of people are turning the lights back on and a lot of people aren't gonna come back right uh think of this like a vacation it's like all these people are like you know what actually i'm i'm gonna keep doing things at home or you know it's actually kind of more convenient for me to just kind of do it on my own schedule instead of having to go there come back shower all that stuff it was just kind of easier for me because convenience and speed always win with humans always you have to always bet on convenience because we are lazy right and especially when it comes to fitness all right and so it's like well that's why and that's why many people can't market outside of five mile radius because people are too lazy to drive further right they're too lazy you're like but our gym's so great it's like yeah but they're gonna choose a shittier gym that's closer to them just being real right and so if you can take the service to them which we now have the opportunity to learn the skill set to do that you can by the time this thing turns back on probably have more recurring profit profit income than you did before this um but it's for the people who want to win and who want to take action otherwise if you're just going to wait totally cool we'll help you when we want to come back because we we do that too um but uh that's just my that's my two cents right now and i know that whenever i talk about online it's always polarizing but i have a really hard time not speaking my mind about something that i think is more profitable and i think it's lower risk and i think in the post corona economy the businesses that will win are the ones that have lower overhead and have higher margins and have a higher ability to reach customers where they're at and all of those boxes get checked and then you get all the added bonus benefits benefits that i said earlier virtually unlimited lead flow cheaper leads bigger radius higher profit margin you get all of those things on top of everything i said so anyways don't let the airship moment happen to you um take action now uh start selling remote i think it is it is incredibly incredibly incredibly awesome right now um and you should get in all right keeping great catch you soon all right have a great day and uh drop a chat a chat or a light but not a chat drop a comment or like or you know review or something like that if you liked if you didn't then i'm sorry alright catch [Music] you