Alex Hormozi: I spent $1,025,000 for this business tip...it paid off

Last updated: Jun 15, 2023

The video is about how to charge exorbitant prices for goods and services by understanding market economics, manipulating supply and demand, and creating scarcity.

This video by Alex Hormozi was published on Jun 16, 2021.
Video length: 08:35.

In this video, Alex Hormozi shares a business tip he learned at a charity event at Arnold Schwarzenegger's house.

He explains how understanding supply and demand can help businesses charge exorbitant prices for their goods and services. He gives examples of how luxury brands like Chanel and Louis Vuitton create scarcity to stimulate demand and increase prices.

Hormozi recommends creating limited or scarce products or services to make more money and emphasizes the importance of marketing in artificially stimulating demand and shifting the demand curve.

  • Alex Hormozi shares how to charge exorbitant prices for goods and services by understanding market economics, manipulating supply and demand, and creating scarcity.
  • Creating scarcity can stimulate higher prices, and businesses like Chanel and Louis Vuitton have figured out how to generate and stimulate demand by creating limited edition products.
  • As a business owner, you need to know how to stimulate demand and not miss out on missed opportunities.
  • As you cut supply, you can raise the price, and there is extra juice in the squeeze that's available for you if you just know this.
  • Manipulating supply and demand can help you charge exorbitant prices for your goods and services, and understanding the demand curve and how to manipulate it can help you make more money.

I spent $1,025,000 for this business tip...it paid off - YouTube

Alex Hormozi: I spent $1,025,000 for this business tip...it paid off 001

Introduction

  • Alex Hormozi shares how to charge exorbitant prices for goods and services by understanding market economics, manipulating supply and demand, and creating scarcity.
  • He shares his experience of attending a charity event and how he donated a million dollars based on the way they manipulated the event.
  • He talks about how a gentleman who made his fortune in the ultra-high-end jewelry business shared a business tip with him that he will never forget.
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Understanding Supply and Demand

  • When demand increases, cut supply to jack up prices.
  • Creating scarcity can stimulate higher prices.
  • Businesses like Chanel and Louis Vuitton have figured out how to generate and stimulate demand by creating limited edition products.
  • As a business owner, you need to know how to stimulate demand and not miss out on missed opportunities.
  • Marketing is artificially stimulating demand by purposely letting more people know about what you do so that you can generate demand inwards.
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The Price Curve

  • As you cut supply, you can raise the price.
  • Most businesses cut their supply but keep their price at a lower price.
  • There is extra juice in the squeeze that's available for you if you just know this.
  • Create a limited or very scarce service or product that you can release to make more money.
  • The demand curve can shift based on marketing, which artificially stimulates demand.
Alex Hormozi: I spent $1,025,000 for this business tip...it paid off 005

I spent $1,025,000 for this business tip...it paid off - YouTube

Conclusion

  • Manipulating supply and demand can help you charge exorbitant prices for your goods and services.
  • Creating scarcity and limited edition products can stimulate higher prices.
  • As a business owner, you need to know how to stimulate demand and not miss out on missed opportunities.
  • Understanding the demand curve and how to manipulate it can help you make more money.
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Understanding Supply and Demand

  • Stimulating demand can increase prices.
  • Controlling supply can increase profits and reduce operational drag.
  • Understanding the supply-demand curve can work in your favor.
  • Entrepreneurs often spend too much time trying to supply and not enough time trying to generate demand.
  • Manipulating supply and demand can create an aura of premium and over-deliver to clients.
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Creating Scarcity to Increase Prices

  • Delaying satisfaction can increase demand.
  • Creating a waiting list can generate more demand and increase allure.
  • Being at full capacity can increase pricing power.
  • Periodically letting off steam can increase pricing power.
  • Creating scarcity can shift the demand curve in your favor.
  • Creating an ultra-high, very scarce supply can increase sales and profits.

Watch the video on YouTube:
I spent $1,025,000 for this business tip...it paid off - YouTube

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