From: alexhormozi
Effective marketing and customer acquisition strategies are crucial for any business, with advertising playing a central role in generating customer awareness and driving growth. The speaker emphasizes that most businesses struggle because “no one knows you exist” [01:59:43], making increased advertising a fundamental requirement for success.
The Fundamental Principle: Advertise More
A key tenet of business growth is to consistently and aggressively advertise. The speaker, with 13 years of business experience and nine companies sold, highlights that even with significant personal recognition, widespread awareness of a new product (like a book launch) is difficult to achieve without massive, continuous advertising effort [02:11:30].
“We get so sick of our advertising so much before our customers or potential customers even remember our names.” [03:06:01]
People’s attention is spread thin, and they are easily distracted [03:19:07]. This means that a single advertisement is unlikely to stick. Customers often need to be “reminded more than they need to be taught” [03:49:18]. Consistent repetition of key messages helps maintain audience engagement and ensures the business remains top-of-mind when a potential customer is ready to buy [05:03:02].
Practical Advertising Strategies
The 4x4 Rule and Rule of 100
For new businesses, the “4x4 rule” suggests dedicating four hours a day to “the core four” activities:
- Reaching out to people one-on-one (warm outreach) [05:20:00].
- Reaching out to strangers one-on-one (cold outreach) [05:21:49].
- Making content one-to-many [05:24:08].
- Running ads one-to-many [05:26:02].
The “rule of 100” provides a daily benchmark for these activities:
- Make 100 minutes of content [05:35:46].
- Do 100 outreaches (cold or warm) [05:38:09].
- Spend at least $100 a day on advertising [05:43:08].
Advertising as a Business Prerequisite
Advertising is a foundational step before revenue generation. People cannot spend money on a business if they do not know it exists [06:18:04]. The speaker asserts that up to $100,000 a month in revenue, advertising should be the primary focus [06:35:40]. This focus is essential to gain enough customer iterations to gather feedback and refine the product [06:44:03].
Early Stage Focus: One Channel, One Avatar, One Product
For businesses under $1 million in annual revenue, maintaining focus is critical [08:36:18]. This means concentrating on:
- One Avatar: Targeting one specific type of customer, even if it means saying no to others with money [08:48:38]. This helps in identifying and serving the ideal customer.
- One Product: Solving one problem with a single, productized service or product [09:07:07].
- One Channel: Mastering one advertising channel (e.g., cold email, cold calls, TikTok ads, YouTube videos) to ensure reliability before diversifying [09:18:05].
Strategic Channel Expansion
Introducing a second or tertiary advertising channel should be delayed until the business reaches significant revenue (e.g., 4 million a month) [09:42:47]. Launching new channels requires time and money, and an existing, well-oiled primary channel generating stable cash flow is necessary to support the less efficient early stages of a new channel [09:51:00].
Building Trust and Optimizing Sales Through Customer Interaction
Starting with Free Offers for Proof
The speaker advocates for always starting with free offers, especially for new products or services [11:28:44]. This approach lowers stakes for the customer and allows the business to gather crucial testimonials and proof of concept [11:54:19]. Customers who try for free can generate value in three ways:
- Provide testimonials [14:24:26].
- Refer new customers via word-of-mouth [14:27:03].
- Convert into paying customers after the free period [14:31:07].
Proof Over Promise
In strategies for business growth through advertising and sales, proof is more compelling than promises [15:00:19]. Beginners often create elaborate offers with numerous bonuses and guarantees but lack the necessary proof to convert customers [15:05:07]. Proof acts as an approximation of the likelihood of success for the customer [15:52:03].
Key elements of compelling proof include:
- Recency: Recent proof is more effective than older proof [16:11:00].
- Visuals: Visual proof (screenshots, photos, videos) is more compelling than text [16:18:49].
- High Volume: Accumulating and displaying a large volume of reviews or testimonials creates an overwhelming impression of success [16:39:56].
- Pain Integration: Testimonials and user-generated content that start by describing the customer’s prior pain convert significantly higher [17:36:13]. This allows prospects to relate to the problem before being shown the solution [18:07:07].
The best time to ask for a testimonial is at the moment of greatest customer satisfaction [18:27:01], while the best time to sell is at the moment of greatest pain/deprivation [18:35:36].
Leveraging Customer Feedback for Better Advertising
Directly talking to customers can solve nearly every business problem, including issues with advertising conversion or product delivery [25:31:54]. By understanding customer language, pain points, and desires, businesses can refine their advertising messages, sales scripts, and product improvements [27:06:56]. This feedback is invaluable for creating more effective use of advertising hooks. It is particularly useful to talk to both satisfied customers (super users) for insights into future improvements and those who didn’t buy or canceled to understand friction points [31:30:46].
Strategic Alignment of Sales and Advertising
Arming Salespeople with Content
To improve conversion rates, salespeople should be equipped with an Excel sheet containing relevant content (videos, articles) that addresses common customer concerns [56:02:44]. This allows content to do some of the selling, making sales interactions more efficient and effective [56:32:00].
Unifying Sales and Advertising Departments
Unifying sales and advertising under a single “acquisition department” or Chief Revenue Officer (CRO) eliminates cross-departmental conflict and aligns efforts towards a common goal [57:16:03]. Both functions serve the same purpose: to provide potential customers with enough information to make a purchasing decision [00:57:47]. Advertising communicates one-to-many, while sales communicates one-on-one, filling in informational gaps left by advertising [00:58:20]. This strategic alignment directly supports the importance of advertising in scaling businesses and achieving sales targets.
Financial Considerations for Advertising
Leveraging Prepayments for Ad Spend
Securing upfront payments for longer durations (e.g., annual billing instead of monthly) significantly increases cash flow [46:16:03]. This improved cash conversion cycle allows a business to offset the costs of advertising and sales commissions more quickly, enabling faster and more aggressive reinvestment into ad targeting and acquisition efforts [48:15:37]. This strategy provides an “infinite money glitch” for growth by allowing generated revenue to immediately fund further customer acquisition [49:28:43].
Conclusion: The Relentless Pursuit of Awareness
The path of entrepreneurship is inherently stressful, whether a business is growing, stagnating, or declining [41:42:01]. Much of this stress comes from confronting problems you don’t yet know how to solve [43:42:47]. However, a key aspect of scaling businesses with advertising techniques is embracing the unknown and persistently working on the most critical problem, even if it’s difficult [01:14:02].
Instead of constantly seeking “new” and seemingly “easier” methods – falling into the trap of uninformed optimism followed by pessimism and despair [38:49:09] – entrepreneurs should focus on doing “10 times more of what’s already working” [36:21:03]. This means identifying the current constraint to growth and dedicating efforts to solving it, rather than seeking novel, unproven innovative customer acquisition strategies [37:02:18]. The hardest work is often the work you don’t know how to do, but it is precisely this work that yields the greatest rewards [01:12:24].