Alex Hormozi: The REAL Reason Your Business Isn't Growing

The video discusses the reasons why businesses may not be growing and provides three frameworks to help entrepreneurs expand their customer base within their current niche or market.

This video by Alex Hormozi was published on Jun 14, 2023.
Video length: 08:04.

In this video, Alex Hormozi discusses the real reason why businesses often struggle to grow and expand.

He explains that many entrepreneurs make the mistake of trying to add complexity to their business by starting new product lines or expanding into new markets, when in reality they need to focus on getting more customers within their current niche or market. Hormozi breaks down three different frameworks for thinking through this issue, including marketing methods, platforms, and media, and emphasizes the importance of finding a market that checks all four boxes of pain, ease of finding, money to spend, and growth potential.

He also introduces the concept of the Pyramid of Markets, which outlines five different directions for expanding within a marketplace, and shares a personal story about how his own company, Jim Walsh, decided to expand into health clubs after saturating the micro gym market.

• Entrepreneurs should focus on getting more customers within their current niche or market.
• Three frameworks are provided to help entrepreneurs expand their customer base.
• Marketing methods include running paid ads, making content, doing outreach, getting referrals, and getting affiliates.
• When choosing an adjacent market, consider which market provides the most value for dollars made.
• Expanding a business takes time and effort.

The REAL Reason Your Business Isn't Growing - YouTube

Introduction

• Entrepreneurs often make the mistake of expanding their business too quickly.
• They need to focus on getting more customers within their current niche or market.
• Three frameworks are provided to help entrepreneurs expand their customer base.

Marketing Perspective

• Marketing methods include running paid ads, making content, doing outreach, getting referrals, and getting affiliates.
• Platforms include Facebook, phones, email, Hulu, YouTube, and Google.
• Media on the platform includes Instagram DMs, Instagram stories, Instagram posts, and Instagram reels.
• Volume within the media includes posting one story a day, one story a week, multiple stories a day, and multiple posts a day.
• It's important to consider the ad spend of competitors in the same market to estimate the number of new clients per month.

Choosing a Market

• Four things to consider when choosing a market: are they in pain, are they easy to find, do they have the money to spend, and are they growing?
• Once a market is chosen, consider if a new method, platform, or media can be used to get more customers.
• If all options have been exhausted, consider expanding in one of five directions: up, down, left, right, or adjacent.

The REAL Reason Your Business Isn't Growing - YouTube

The Pyramid of Markets

• Entrepreneurs often hit a plateau because they have saturated their current niche or market.
• Expanding into adjacent markets can help grow the business.
• When choosing an adjacent market, consider which market provides the most value for dollars made.
• Example: Jim Walsh expanded from micro gyms to health clubs because they were able to provide the most value to health club owners.

Conclusion

• Expanding a business takes time and entrepreneurs need to focus on getting more customers within their current niche or market.
• Three frameworks are provided to help entrepreneurs expand their customer base.
• When choosing an adjacent market, consider which market provides the most value for dollars made.

Four Directions to Expand Your Customer Base

• Go up market by targeting higher quality customers who spend more, such as franchisors or chain owners.
• Go down market by targeting hair stylists who rent chairs and do hair full time, but are not running the business.
• Go adjacent by targeting businesses that are similar in nature but not exactly the same, such as a lash and nails place for a hair salon.
• Go broader by targeting all businesses within the same psychographic, such as Med Spa owners, flash owners, and massage studios.
• Go narrower by targeting a specific niche within your current market, such as salon owners who specialize in extensions or a blow hair place that only does Brazilian Blowouts.

Investor Mindset for Business Growth

• View your market as a large industry with potential for growth, rather than a saturated market.
• Identify the four initial levers to immediately pull to grow your leads: up market, down market, adjacent, and broader.
• Don't get overwhelmed by the checklist of "should do's" and focus on implementing one lever at a time.
• Understand that building a successful business takes time and patience.

Watch the video on YouTube:
The REAL Reason Your Business Isn't Growing - YouTube