How To Raise Your LTV | Ep 823
The Game w/ Alex Hormozi
Deep Dive
What is the main issue Laurianne faces with her personal finance courses business?
Laurianne's main issue is her CAC to LTV ratio. Her customer acquisition cost (CAC) is too high at $1,500, and her lifetime value (LTV) is too low at $2,400. Additionally, her average order value (AOV) on the front end is low, and her back-end upsell rate is only 7%, which is significantly below the target of 25-50%.
What solution does Alex Hormozi suggest to improve Laurianne's ascension rate?
Alex suggests bringing the sales team in-house to improve the ascension rate. He recommends integrating the ascension process into the onboarding, where customers go through a goal-setting call after the initial purchase. This call would then lead to a closer call, pushing qualified customers into higher-ticket offers. Additionally, he advises testing different webinar intros to improve LTV.
What is the problem with Jacqueline's dental practice, and what solutions are proposed?
Jacqueline's dental practice has a 30% cancellation rate, resulting in a $1 million loss due to no-shows. Alex suggests implementing integrity tie-down questions, pulling up appointments to increase shop rates, and using automated and manual reminders. He also recommends personalizing reminders by offering incentives, such as letting patients choose free items for their goodie bags, to increase accountability and reduce no-shows.
What scaling model does Alex Hormozi recommend for Tyler's roofing business?
Alex advises Tyler to first nail down the business model before deciding on scaling. He suggests focusing on the current insurance-based model, which accounts for 95% of revenue, and avoiding franchising unless the model is fully optimized. Alex shares his experience of flipping franchises into corporate-owned locations to reduce administrative headaches and increase profitability.
How does Alex Hormozi suggest Adam improve his music lessons business?
Alex recommends shifting from one-on-one lessons to a semi-private model to increase gross margins to at least 80%. He suggests charging $50-$60 per session for groups of four, which would yield higher profitability. Additionally, he advises positioning the business as a premium service for neurodivergent kids, leveraging the specialist angle to justify higher prices. He also emphasizes the importance of creating discrete outcomes, such as a six-week beginner challenge, to attract and retain customers.
What is the Scaling Roadmap offered by Alex Hormozi and Leila?
The Scaling Roadmap is a free resource that breaks scaling into 10 stages across eight business functions, including marketing, sales, product, customer success, recruiting, HR, and finance. It identifies problems that emerge at each level of scale and provides solutions to graduate to the next stage. The roadmap is personalized based on user input and includes about 30 pages of content per stage, with a total of 14 hours of material condensed into 90 minutes of relevant content.
- High CAC and low LTV ratio is the main problem
- Primarily using Meta ads for customer acquisition
- Low ascension rate (7%) needs improvement
- Bring sales team in-house for better control
- Implement BNPL options for easier payments
- Split test webinar intros to optimize LTV
Shownotes Transcript