$100M CEO Explains How to Build A Brand in 2024

Brief Summary

Alex Hormozi explains how to build a strong brand by deliberately pairing your product with things your ideal customers like, leading to increased pricing power, improved advertising, and greater customer loyalty. He emphasizes that good branding changes customer behavior in your favor and provides a lasting competitive advantage. The key takeaways include understanding what branding is, why it makes money, and how to start and grow your own brand by focusing on influence, direction, and reach.

• Branding is a deliberate pairing of things through an outcome.
• Good branding leads to increased pricing power and customer loyalty.
• Focus on influence, direction, and reach to measure brand growth.

Intro

Alex Hormozi shares his personal success, highlighting his ability to earn more than the CEOs of major corporations during his 20s, leading to a substantial net worth by age 32. He acknowledges that this information may evoke various reactions, including envy, anger, skepticism, and inspiration. Hormozi states that the presentation is for those who aspire to charge significantly more than their competition, foster customer loyalty, and guarantee sales for new products, similar to brands like Yeti, Harley-Davidson, and Apple.

What Branding Is

Hormozi defines branding as a deliberate pairing of things through an outcome. He uses Coca-Cola as an example, where the "yum" (outcome) is paired with the act of drinking Coca-Cola (action) and the product itself. He contrasts this with bad branding, using the Dylan Mulvaney and Bud Light collaboration as an example of good advertising but bad branding because it alienated many customers. To fix this, Bud Light paired with Shane Gillis and the UFC, aligning with their audience's preferences and recovering sales.

Branding 201

Hormozi explains that the effectiveness of a pairing depends on the audience. While the Dylan Mulvaney pairing was bad for Bud Light's primary audience, it might have been good for a different brand. Similarly, the Shane Gillis and UFC pairings resonated well with Bud Light's ideal customer base. The key is to choose pairings that result in more sales and positive outcomes for the target audience. Hormozi emphasizes that the goal is to deliberately pair a business with good outcomes for its ideal customers, influencing who pays attention and whether they are drawn to or repelled by the business.

Why Good Branding Makes You Money

Hormozi discusses the earliest uses of branding, such as branding livestock, to illustrate how it affects behavior. A branded cow is treated differently than a wild cow because the brand signifies ownership and association. He explains how a weak brand can be strengthened by pairing it with things customers like, using Nike's association with LeBron James and Tiger Woods as an example. A strong brand transforms commoditized products into premium products, encouraging customers to associate themselves with the brand's values and outcomes through their purchases.

Steps to Build a Strong Brand

Hormozi outlines the steps to build a strong brand: start with a brand that means nothing, pair it with something customers like, and the brand starts to mean that thing to them. Customers then want to associate with that thing, leading them to buy the product. He uses Dolce & Gabbana's collaboration with Kim Kardashian as an example, where customers buy the brand to associate with fame, beauty, and wealth. Hormozi emphasizes that the point of building a brand is to change customer behavior in your favor.

Benefits of Good Branding

Hormozi highlights the benefits of good branding, including pricing power, improved advertising, and customer loyalty. A strong brand allows businesses to charge premium prices without losing customers. It also improves advertising response rates and fosters customer loyalty, protecting the business from competitors. He quotes Warren Buffett, emphasizing the importance of pricing power and the lasting competitive advantage that a strong brand provides.

How to Start or Grow Your Own Brand

Hormozi explains that starting a brand involves deliberately pairing your product with what your ideal customer likes, while avoiding pairings that lose customers. He uses the analogy of assembling a bouquet of flowers, where the flowers represent brand elements and the bouquet represents the brand itself. He discusses how to narrow or broaden a brand by focusing on specific topics or expanding to tangential areas. Distant and random pairings hurt a brand because they make it difficult to form associations.

Maintaining and Recovering a Brand

Hormozi discusses how to maintain a brand by curating a garden, adding good elements and removing bad ones. He explains that even one bad pairing can hurt a brand, but it can be overcome by overwhelming customers with positive associations. He uses Kanye West as an example, who recovered from negative publicity by releasing successful products. Hormozi emphasizes the importance of ensuring that the product itself is high quality to reinforce the brand's positive image.

Measuring Brand Success

Hormozi identifies three main metrics for measuring brand success: influence (how likely it is to change someone's behavior), direction (whether the change is positive or negative), and reach (how many people it affects). He contrasts a small, weak brand with a large, strong, positive brand. He uses Donald Trump as an example of a polar brand with high reach and influence but mixed direction, and Taylor Swift as an example of a large, positive brand with high reach, influence, and positive direction.

Applying Branding Concepts

Hormozi explains that the branding concepts apply regardless of audience size. He uses the example of parents as a brand with high influence but low reach. He emphasizes that building a brand involves pairing your product with things the highest percentage of your ideal audience likes. New pairings always carry risk, potentially losing some audience members, but the goal is to gain more people than you lose, resulting in an increase in reach, influence, and positive direction.

Real-Life Example and Gifts

Hormozi shares his personal branding strategy, associating himself with business value by creating content and books for small business owners. He offers two free gifts: video versions of his books "100 Million Dollar Offers" and "100 Million Dollar Leads" for existing business owners, and a free start on school.com for those wanting to start a brand. He concludes by inviting viewers to use the information to make money, indicating that good branding has occurred if they do so.