Watch This If You Own a Service Business | Ep 971

This is Corey. Corey runs an HVAC business with his wife doing over $1.2 million per year in revenue. But number one, that $1.2 million isn't all profit. And number two, he has $60,000 in debt that he wants to get rid of. I'm Alex Hormozi. I own Acquisition.com, which is a portfolio of companies that did over $250 million last year in aggregate revenue. We have several service-based businesses in our portfolio, so I've done a lot of thinking about the problems that Corey's dealing with. And so first we're gonna deep dive into the business and then we're gonna break down all the tactics he and you can use to scale. And at the end, We're going to check in with Corey one year later.

Originally we were doing about $1.25 million in sales. Currently, see if the tactics actually helped him scale his business.

So let's meet Corey.

What's going on, Alex? My name is Corey.

What's up?

I own Pro Shine Professional Cleaning with my wife Nicole. We are an HVAC cleaning and ductwork repair company.

What problem you trying to solve?

So right now we're allocating about 10% of our profit going towards paying off some of our debt.

How much debt you got?

It's about $60,000. Okay. And then Lead generation. Uh, we're trying to get higher quantity of leads and also, um, leads that are higher value clients. On the bottom of that is just to like really just help our client with our booking process. I think that we can streamline it a little bit better, make it easier on them, and then also not lose out on the possibilities of upsells or anything like that throughout that process.

Why is solving this important? What happens if you don't fix this?

First and foremost, we're a people company, so we really go out in the community and just do the right thing. And I'm grateful to have guys on my team that really share that goal. Makes our life a lot easier. That's why it's important to us so we can help more people and then also grow our business.

All right, awesome. Okay, so how do you make money?

This is actually where ProTran's a little bit unique. For our HVAC cleaning, full end price for us is $1,575 per HVAC unit.

Okay.

Each house we do has about 2 units. So with that $1,575, we have a 2-year growth-free guarantee. What that is, is when we come out, we make sure that we're disinfecting, that we're properly killing any kind of bacterial growth. So clients love having that guarantee in place so that they don't have to worry about it in the future. And then we have ductwork rewrapping, which is pretty much replacing the old insulation. And then also our dry vent cleaning, which is $175.

Do you show customers pictures of the inside of their vents?

Yeah, absolutely.

Yeah.

So actually we have a customer profile so they can access any point in time. So if they want to sell their home, they can use it as an advantage for them.

I like that. Where do you get your customers? All right.

So we have a couple of different channels. 60% come from paid ads, $3,000 a month go from Google. we actually just upped that a couple of days ago to $5,000 and then also $650 from Facebook. Facebook is very new for us. We just started the last 2 weeks and then 15% of our job flow comes from local SEO, which is a third-party company. And then affiliates and referrals are a very big portion for us because we are partnered with a lot of HVAC companies in our area. One of them actually sends us about $30K a month. So we really just want to replicate what they have going on. And then share that with our other partners.

So what's the advantage to that affiliate sending you the $30,000 a month?

We actually send them back roughly $40,000 to $45,000 because they have higher ticket items. So when they go in, they're doing full replacements where we're doing some patchwork and some cleaning. Say they send us 20 leads, we'll send them maybe 4 or 5, but they make double what we would.

So Corey has a unique affiliate strategy, which is that he purposely limits his own services so that he doesn't compete with other businesses in his, quote, space. And so he refers them the high-ticket business, but then they refer him some percentage of their business. But the beauty of this model is that he's able to do this with tons of high-ticket providers so that he has almost limitless lead flow of people coming towards him basically for free. So give me whatever other numbers you think I should know.

Our numbers right now, $1.25 million over the last 12 months. Profit on that is $479,000. Our net margin is 38%. So our marketing spend right now is just under $7,200 as far as our marketing strategy altogether. Our show rate actually, funny enough, is 99% because it's the 1% that the client just happens to not be home where they forgot about our appointment. And then our close rate is 82%.

If we double the lead flow of the business, can you handle that?

Yes. So actually we just hired on 2 more employees and we just got a third van.

Right off the bat in every business, I think the first problem I try to delineate is this a supply-constrained business or a demand-constrained business? Meaning if we can double the lead flow and they can handle it, then it's a a demand-constrained business. If we double the lead flow and they can't handle it, then it means that we gotta go build the resources and infrastructure to be able to handle a doubling lead flow in the future. And I think this is such a common thing that I see with business owners. They're trying to fix a problem that's already a problem that if you fix it, makes your existing problem worse. I got a, a bunch of notes. I think we might be able to help you get more people, more impact, and more clean air.

That's what I'm talking about.

All right, let's do it. There's nothing majorly wrong. And so that's the good news.

Yeah.

And obviously you have 38% margins, you're growing. The last thing I wanna do is like break something.

Right.

And so I think this is going to be a game of incremental improvement, right? Like no Hail Marys. This is just consistent yardage.

Trust the process, right?

Yeah. Number 1, I think that there's actually still some more room for pricing. Number 2, let's talk about the debt. Number 3, talk about the affiliate piece. 4, we'll go funnel conversion rate optimization. And then 5, we'll go ads. Perfect. A 6. Reactivation emails.

Mm-hmm.

Corey's at stage 5 on the $100 million scaling roadmap. He's at productized. So he's got 10 to 19 people who work in the business. He's got maybe 2 or 3 people in the business that are kind of like manager leaders that are running this thing. Now, some of the issues that he's dealing with is that customers are having nothing else to buy and churn. We have to figure out how we can get more repeat business for the business. His qualified leads are too expensive and cap your ability to advertise. And so what we're doing is we're trying to improve the throughput on his existing advertising process so that he can get more leads because he can handle more leads. We're creating more sales materials, tweaking pricing, sales process, creating a CS playbook. All of this stuff is the things that happen all the time at the productized stage. And so if you're like, shoot, that's almost exactly what he's going through. That's because businesses behave in patterns. And so if you're not sure what stage of business you're at, this scaling roadmap is 100% free. You can go and get it at acquisition.com/roadmap. And put in your business details. And on the thank you page, if you would like our help actually helping you de-bottleneck these things, kind of like what I'm doing with Corey here in person at my headquarters on the thank you page, just schedule a call. My team would love to have a conversation with you. Worst case scenario, we provide value. Best case, we'll see you out here in Vegas. So first things first, the price. So you did a 23% price increase after the first time we talked to you. Okay. And so that resulted in a higher close rate and more money, right? Wonderful. So Corey had actually come to one of our workshops at acquisition.com earlier, and we had made this first initial suggestion, which is like, hey, bump your prices. and he obviously saw a big improvement, right? He was able to charge more and close more. And the reason we made the recommendation is 'cause we looked at, you know, businesses in that space and we're like, we think you're mispriced. Some people may be like, how could you raise prices and close more? Well, let me explain. There's two scenarios where this could be true. One is something called a Veblen good, which in economic terms is usually like a high-end luxury item. So like a Rolex, sometimes if something goes up in price, it becomes more sought after. That's not what happens for Corey 'cause he's in the other bucket, right? No one's like bragging at their, uh, Rotary Club about how much they they spent on their HVAC. So instead what happens is that if you have what I would consider a normal business providing a normal service or product, if you raise your prices, what sometimes happens is that the conviction of the customer that you can actually deliver on the promise you're making goes up. And so on the value equation, which I talk about in this book, it actually increases the perceived likelihood of achievement. So by raising the price, we actually increase the value. And this is why I talk about charging premium prices. Page 48 in the Offers book, I talk about the virtuous cycle of pricing. And so what happens is if you raise your price, you increase the emotional investment, you increase the perceived value, you increase the results, and you decrease the demandingness of the customer. You get more money to actually deliver. And so what happens is a lot of times people will just try and like, ah, they're so afraid of charging money that they actually sell themselves out of a sale because it's so low price that they're like, gosh, this guy seems like a run, you know, super seedy duct tape operation. Right. And so many of you, especially newer business owners, I'd say like sub— call it $3, sometimes $5 million in revenue. Some of the biggest levers that exist in the business is simply charging more because people actually believe you can deliver the service now. So whenever I hear 80% or over 80% close rates, I usually know that there's room. And so basically what I penciled out was a 10% price raise. This is more asking than telling. We would have to believe that we're not going to drop to 65%. As long as we close more than 65%, we make more money. Thing is, is that 10% price raise for you equals roughly a 25% increase in net profit.

Right.

So that'd be roughly $100,000+ a year. And that's at last year's volume in profit. So that's number one. Does that sound something like something that you could stomach or no?

Yeah, 100%.

So the second thing is how fast do you plan on paying off the $60K debt that you have?

We are planning to pay off completely in the next 4 to 5 months.

Okay, good. That's one of those things that like, I would say this is more of an emotional thing, but it's just this back of mind thing. If there's a range of like Dave Ramsey and then like, you know, Wall Street, I tend to skew like very close to the Ramsey side and And the single argument that I have around it is basically debt increases risk. Risk when multiplied over a long time horizon tends to come due. And so like businesses have seasons, they have volatility. And why did I take the, you know, the debt out to begin with? A lot of times it's like, 'cause I wanted to grow faster. You know what I mean? If you look at some of the most enduring companies, a lot of them like Chick-fil-A operate debt-free. Let's do ad stuff first, then I'll circle back to affiliates.

Cool.

So let's pull up the page that the Google ads are going to. Right now, this is where the ads are going.

Right.

Right now, what most people are probably doing is they're clicking the button on the top right if they're desktop, or if they're mobile, they're probably clicking the button right there. It's almost like having two landing pages in a row. And so you might not know this, but like typically you'll lose about 50%. Decreases. Yeah, by like half.

Okay.

Wow. Just for every step you add, it's usually about half or more that you lose. Can you shrink that to mobile just so I can see what it looks like on mobile? Okay. That looks a little better. But what I'd want to do is like, I want that to just be a headline. I don't think the Pro Shine, et cetera, stuff at the— like see how it's kind of like messy. Yeah. It's like there's a lot of stuff going on. So I tend to just either really shrink the logo so it's like a very small, because it's literally the prime real estate is everything that's above this fold. And the first thing someone sees is the top, which right now is like a lot of blank space.

Right.

So I would probably wipe that, probably that button. So it's just the hamburger menu and the Proshine. That'll massively shrink the top bar. You have the home and then the site nav. You can drop that. We want to basically build a specific lander for ads, which isn't the homepage. Because this page, it serves one function, which is conversion. Right. We actually don't see an offer. Keep scrolling. Yeah. And so this is actually where the conversion happens. So we're losing a ton of traffic.

'Cause they're going to the top part. Oh yeah.

The basic level of this is like, let's just have this offer clear and then eliminate all the other stuff on the page basically. So let's go to the ads real quick. I think the one takeaway that I have there is you have more opportunity to spend. Absolutely. So like, I think that at the very least we'd be like, we just want to continue to spend month over month provided our ROAS and our CAC stay more or less the same. And the fact that you're already at 13:1 up front, and that's with like what I would consider like a pretty unoptimized page, like that might double to like $26,000. The changes that we do in the funnel, you might be able to go from like $5,000 to like $30,000 a month in spend.

Right.

Which would be sweet.

Yeah.

Right. So let me ask you a question. If for every dollar you gave me, I gave you $5 back, what would your budget of dollars that you'd give me be? If you answer that correctly, the answer would be as many dollars as you possibly could. And then once I give you more dollars back, you take those more dollars and give those more dollars to me, and then I give you more and more dollars back. And fundamentally, that's how good advertising should work. And so it's interesting is that there's a lot of businesses and you've probably seen multiple on this show where you'll see somebody getting 10 to 1, 20 to 1, 30 to 1, and they're spending $1,000 a month. And it's like, why are we not spending $2,000 a month or $5,000 a month? Now, if you're not sure, then you have a data problem. So you got to go make sure the attribution is right. But if you know that's where the money's coming from, by all means spend more. And I know that there's like some emotional barriers because I've gone through them where you're like, oh my God, I can't believe I'm spending $1,000 a day because you feel like you're getting $1,000 poorer and you're like risking it. The thing is, is that if you already know based on past metrics and the existing campaigns that you're running, that you get this expected return, then this is just part of leveling up in business is that you take greater and greater risk and at the same time you get greater and greater rewards. Okay, so let's go Facebook ads. All right. So the good news is that you got ads up. Yeah. The way that I would try and look at these is that most times when people make ads, especially creative people, they use Canva or whatever and they're making on their desktop. But the thing is, is that the way that you need to see it and the way that your CMO should look at it, you should literally text— she should text you the image of the ad because it's going to be about as big as it's going to be on someone's phone on social. Can't even see. Visit our website. You can't see that little— you can't even— you can barely read it now, right? You can't see the number. You're not going to be able to read that. The checkpoint things, you can't see that either. All we really see is a picture of you and your wife and air duct and dry vent cleaning experts. That's actually the only thing that we're seeing. I'll bet you— I don't know, but I'll bet you that's the highest converting.

Absolutely.

Yeah. Absolutely. So, and that's actually still with pretty rough contrast. Like the 18-point is actually kind of hard to read. You don't need to worry about logo stuff for when you're doing direct response. Hilton Head Bluffton, you want that in the ad copy as the headline. And then the actual image, if we're just sticking with image ads for now, we want the free 18-point inspection to be like, boom. It says get yours today. Just be like, get yours. And then that way it's all the same size, right? And you could probably drop it today. Then I would run 40 variations of this. White background, blue background, blue on white. Like take all the colors that you have for your brand and I would just Basically just run a lot of variations there and you might be amazed by this, but the picture that you choose there, just like it's kind of blocking the work, which is kind of a bummer because I want to see what you're actually doing.

Right, right, right.

Also with pictures with customers like smiling and super happy near their HVAC unit, like people understand what it's about, but I would be running a ton of different images. Also, do you do any organic like posts on like Instagram or— I would take all the best performing organics.

Gotcha.

And literally just the last 5 seconds, just tack on like, hey, if you want an 18, like if this is cool and you want an 18-point inspection, it's absolutely free. Just click the link and we'll come straight out to your house. Yeah. So just take the best performing ones, add the 5 seconds on the back, and then basically each one of them become typically pretty good ads because the algorithm already does the testing for you. The cheapest ways of testing new ads is just like post them as organic and then see how they do. Now let's go funnel CRO. So this is what the page is going to look like. You're going to have your little hamburger menu here. I think you just put the number. 333, whatever, up here. You want to make sure that on mobile this is all one line, so there's no, no other room. Do you do free assessments or no?

Yeah. Okay. We actually, we saw that just changing the verbiage instead of doing a free estimate to like the 18-point inspection.

Yeah, people love that versus free 18-point inspection. And then I think we have our form right here underneath. They have the number at the top for the people who want to call, because I'm guessing because you have it all over that you do have somebody who's answering those. And then you have your little You know, submit whatever thing here. Gotcha. And then I would probably put locations just because I'm thinking what are the most common questions that someone might ask? If you already know those other ones, then I might also include FAQs at the bottom and that would be it. That's more like, that's the page and it should be a freestanding page. That's, you don't even have to have it navigable from the site. Right. You can just be like, this is where all my ads go. You might also find though that if you change all the buttons on your site to redirect to this page, right, you'll just convert more of the existing traffic also on the SEO side.

Yeah.

So I think this honestly, like of all the things I'm gonna go over, I think the pricing, the ads, ads and us doing this funnel change in terms of how we're directing the traffic is probably gonna be by far the biggest improvement. I think you probably have something in the neighborhood of a 2x or more here. That's gonna be really big. The funnel conversion, we've outlined that. You're gonna increase Google Ads. You probably have a ton on the Google side. On the Facebook side, we're going to do, uh, plus plus on images, and we want less text and basically offer First, basically just lead with the offer. In general with marketing, like, I don't want to say think the same thing multiple times. I'll say different ways, but the same content over and over again, like, it just looks cheap, you know, for lack of a better term, which will impact your brand. So let's do the reactivation stuff and then let's pull up the emails. We recommend a yearly free checkup for your dryer vent to ensure it's working safely and efficiently. If you use your dryer frequently or have furry pets, we suggest cleaning it more often. Frequent use means more than 3 loads per week. If you have pets, consider more frequent cleanings. Okay, so what's interesting about this is that this is like, I mean, what you've proven is that just telling people you exist tends to get more business, which is like first, first objective. I would say the second version of this is we says, hey, you know, Proshine family, two things that I would probably consider testing. I owe you a free checkup or I owe you X amount of money. So whatever the cost of a checkup is, use $175 or whatever. Like I owe you $175. That'll get a lot of opens. It's like, hey, it turns out that when you signed up, we didn't communicate a component of our offer that we did to other customers. And I want to make sure that we're trying to do right by you. More like, hey, we messed up. Can we make it up to you? It's a different frame than like, hey, like we're coming back at you. I mean, so nice thing is with this, you can just split test it so you can run it one week and see what the open response rates are in the next week. And the way you're doing this, you're just doing this manually, just looking at your list. Who was the last time out? And then, okay, that's fine. Then this— I mean, the nice thing is that creates a really easy way to do the split test. You don't have that no cost to you in here. So I would make sure that that is definitely highlighted.

Highlighted.

Yeah. So we recommend yearly. And then I put bold, underlined, at no cost to you because people scan these things. Some of the things that I thought of that are like unique angles, kind of like the, hey, I owe you some money, or hey, we messed up, dot, dot, dot. Like what will make this business more valuable in the long run? So number one, savings. So if you can ask for people's bill from your existing people and be like, hey, can you just send us your bills from the last 12 months? And it shows before and after. Because then you'll have a 12-month running average. It's such a stronger pick. Hey, this actually saves money. The reason that I think this is so compelling is that this is what, when paired with the larger price, will make sense. We're charging $1,500 or $1,700 per unit. So it's $3,000, whatever, $3,400 that you're going to pay. But the average person is getting that back in 18 months and it's going to increase the value of the house because we're going to give you this, you know, this little portal that'll show you all the fix-its and the mess-ups or whatever. One is I would send those stats out about savings. Okay. Number 2, in terms of themes of the emails, is I would take the exceptional ones and send those. I'd be like, hey, this is Casey. Casey was at $600 a month and now she's at $150. You're like, holy cow, I could use that kind of— it's like, hey, you know, hit us up. It's better for your allergies and it's better for your pocketbook. Like those are pretty— the 3 kind of strong angles, which then leads me to the second kind of stat that I think is worth collecting. So one, we have the stat on savings, which I think will be the most compelling. But interestingly, I'll bet that if you had a different angle on some of the ads, which is like, Are you sneezing a lot? Are your eyes watery? Like, what are the pains of somebody who has allergies? And I'm somebody who has terrible breathing. And so that's why, you know, I recognize it. And if someone says, did you know that allergies are reduced by 33% by just having better air? And then be like, contrast that with 90% of houses are past their period of time where the existing filters work or whatever.

That's why we blow up in April when pollen season comes. Yeah. And all the windows are open.

Yeah.

That's big for us.

So the nice thing is that if you have 1 or 2 times a year that you know it's going to kind of blow up, then you actually get basically year-round coverage. In the gym world, people want to get in shape for summer. So for us, we have summer and then we have New Year's as like 2 kind of polar ends. But we can get year-round signups because as New Year's approaches, it's like you're advertising, hey, you want to start— you want to start getting in shape for the new year. And then once New Year happens, it's like, hey, don't you want to make sure you have your New Year's resolution that worked? And then it's like, hey, did you miss your New Year's resolution? Right as we're getting into like March, April, it's like, hey, if you want to get in shape for summer, you got to do it now, right? Right. And then once summer hits, it's hot as shit. And then they're like, fuck, you know what I mean? I'm in a bikini. I look like— I look terrible. Hey, if you look terrible in your bikini, you should come in now. It's like, hey, did you— and then right then we're going right back into here. And so we only need like 1 or 2 kind of seasonal pain points to go pre, during, post twice, basically on 2 cycles a year. That theme is what you communicate to the CMO. All of our messaging for the next 2 months is going to be anti-allergy, and that's going to be through the emails, that's going to be through the ads, it's going to be through Google PPC. Next 2 months, it's going to be like, okay, season is here, right? Because the thing is, is also your targeting is going to go to some of your existing customers. And so I'm sure some people are booking through Google search that already are customers of yours. They just don't know how to find you. They just Google, right? And so this just gives you another opportunity to get in front of them more times.

So it was really cool to hear from Alex that we could start using some anti-allergy or some mildew kind of things that we can implement, because I know that this is a big issue that many homeowners don't think about until it's unfortunately too late.

Real quick, I'm going to show you the exact 10-stage roadmap from 0 to $100 million plus. That less than 1% of companies finish. I've now done multiple times. And so I can say with a lot of confidence that these are the stages as headcount increases that you need to get through. And I broke each of these down by 8 different functions of the business. What the constraint feels like, like what are the symptoms of it when you're going through it? And then what steps we actually took to graduate. And we've done this across software, physical products, uh, service businesses, brick and mortar, all of this. And it works. And it's my gift to you. It's absolutely free. And so the link's in the description, but you just go acquisition.com/roadmap, just enter your info and it'll spit it right back to you all free. The other thing, do you have retargeting across all platforms set up?

We're working on it.

Okay.

Yeah.

Yeah. So that would be for me, like probably be number 7, cross-platform retargeting. And the other thing is, number 8, is we wanna own all terms. Quick pro tip for just about anybody. If you advertise at all or even have some level of word of mouth, people will search for your business or your name. And so for me, it would be like I should own Hormozy, Alex Hormozy, you know, Hormozy Acquisition, acquisition.com, all these different permutations of things that are words or branded terms that I have been consistently marketing over an extended period of time. And so we just have to think, what are people most likely to search for if they know who we are? And we just want to make sure that we're first thing that people see, because otherwise you leave that space open for competitors to advertise and scoop your customers for you. And this also helps out businesses who don't have as strong of SEO. So search engine optimization, so that if your customers are searching for you, that they find you. And that's the point. And I'm willing to do that even if I have to pay, because some people are like, well, they were going to find me anyways. I don't want to pay for that click. Dude, get bigger problems. Like you're, you're not going to lose money on that because think about the alternative. Someone could just outbid you on your own terms and then it becomes a problem. And I'll say this, if someone is outbidding you on your own terms, the good news is you'll always be able to beat them. On being more profitable on your name? If we're looking at this stuff, I think we're looking at basically once a month here, one time per month. And I think that these reactivation emails would be one is like, I owe you, which I would have a follow-up to this one. So there's difference between like we might email once a month, but we might have like a 2 or 3 email sequence just for like that little segment. Does that make sense? So it's almost like 3, 6 mini campaigns more than 6 individual emails. And so we're like, I made a mistake on your account. Okay. But that's like kind of like A and then B. We probably have our allergies angle, then we have our savings angle, and then we have our environment. You never know. Yeah.

Another good one around the allergies, like from the polar opposite from obviously April to like the end of year, like when it starts to get cold, is mildew smell. Because a lot of times when those heating elements start to to kick up an electric heat or smelling it through the ductwork.

So you've got pollen and then you've got, what'd you say? Mildew. Mildew, right. These are kind of like your two variations of your different kind of allergy angles. I would also consider doing case studies as the follow-up for each of these. So it's like, here's the stats behind this. Then the follow-up email is like, hey, here's Casey who had the same issue. Maybe you should consider that. And so then this one gets us to like, Come back, right? Because that's our 6 months. Yeah. Like, I would be unsurprised if it doesn't do 20 to 30% of revenue.

Yeah. Like, yeah, big time.

And nice thing with this, it's all profit, right? It's back. All right, so let's talk about affiliates. Okay. All right, so walk me through your existing affiliate process.

So right now we just have a connection with our other partners. Typically they're either in the HVAC space or they're pest control, even remediation companies. We've made connections one-on-one with them. They know what we do.

How'd you make the connection?

Through networking, just in general. So we have networking events that we go to. People that we're partnered with refer us out to other companies that they work with.

Your existing referral program has basically just been like, I'll send you business, you send me business, and that's worked out okay.

Yeah.

But how many would you say are actively sending you business?

On a consistent basis, one. Okay.

Which is the one. Yeah. So I'm going to guess that's just worked out. But most of the times if you want to have like a true kind of affiliate or partner program, we need to have some sort of offer for them. I see this as basically two potential avatars and I don't want you to focus on both. I want you to like pick one basically. We've got events play, which is, okay, I'm going to go to these HOAs. I'm going to go not during the time that there's an event and say, hey, when do you have your HOA events? I did this house and this house in this neighborhood because that's going to be key, right? Like we already did this house, this house. You can call them up if you want, hear their numbers. We'd love to be able to just know what your schedule is for when you have your HOA events just so we can just showcase, you know, we like to be a part of the community, blah, blah, blah, blah, blah. But this is an outbound effort that you're basically— it's you plus car or Nicole plus car going out and shaking hands, kissing babies. And basically what we want to do is create a calendar so that we end up getting to, you know, 1 to 2 a week, which I think you could totally do.

The stuff that we're getting from that event. I mean, the last event we did, we booked 55 inspections, both our CMO and Nicole. I mean, they rocked that stuff.

So I see this as a very good way of doing it. But I think we go outbound. Give us your calendar for what your events are. And then it's just like once you have their calendar, you're in. And then every time you're there, you're like, hey, when's the next one? And that way you just always go book an event from an event. What's your end? Now on the partner side, what I want to talk about is the offer. We want to have a really compelling offer for them. Referrals, everyone promises, no one delivers. And so it's like you need to have something that they're going to like, you know, get into bed with you on. Whatever the highest gross margin thing that you can do that's like kind of lower ticket. So that $175 thing, I think that you say, hey, you can charge $175, You can keep the whole thing and we'll do the work. But then when you go out, you've got the client and then you can sell the rest of your— the rest of your work. Right. So this is the $100 Million Leads book. This is page 223. We're talking about affiliates. And so one of the key parts about making an affiliate work is figuring out the offer that's going to work best for them to sell on your behalf. And so I have a couple different versions of, of setting this up. I outline them on pages 237 to 239. So I basically give you 3 different versions that you can use to get affiliates to promote your stuff. Now what I'm proposing for him, he offered number 2, which is they have the core thing that they're selling, but then they upsell for $175 his lead magnet. So they're going to sell something that he's going to give away for free to them to give to their customers. And then once that customer comes in with that lead magnet because they bought the $175 thing, you then upsell the core offer that applies to you. The reason they do it, the other business, is because they make all this money on the $175 that they don't have to do anything for. You like it because it might cost you only $25 to deliver that $175 thing. So your cost of acquiring the customer is your conversion rate from lead magnet upsells to your core offer times the cost of delivering it. So if let's say 1 out of 3 people takes the upsell, well, if your cost of delivering that upsell is $25, then it costs you $75 per customer, which is probably exceptional math for his business.

And it's a very good point because our technicians are trained to even if they're doing just a dryer, to push the inspection to see what's going on while they're there. Okay.

And so this, we give this to affiliates. So, you know, you have your, your one guy, but it's like, hey, let me talk to 10 other ones. I saw that you guys don't do duct cleaning. We do. It's one thing to say, hey, we're going to refer you business, which we will.

Right.

But you also only have so much business to refer to. And the thing is, is long term, it's a less scalable option because what ends up having to happen is if you're like, well, I want 20 referral partners, it's unlikely they're going to have sufficient referral volume to send them all. Enough business.

Yeah. So the good thing about what we have right now set up, it's another set of eyes as well for us to go through and diagnose their system.

Yeah.

So it gives them more visible time on their, their units in their clients' houses. Yeah. Which allows them— allows us to say, hey, listen, like, this needs to be replaced or this is wrong.

We'll upsell your stuff if we don't do it.

But right. Well, we send them right back to whoever sent us there.

Yeah.

So, you know, depending on what partner we're going there with, solidify some of their sales as well. Yeah. Which is why that affiliate with our biggest one is working so well.

So I think that this is the offer I would approach them with and just say, listen, you can sell it. I'll send all my guys out. I'll eat it at 100% of cost. You take all the money and you just know what your metrics are like. You're still going to close 87% and it's going to be $3-4K. So who cares, right? You would pay $175 because the hard cost of sending the guy out is less than that. So what's the cost of sending the guy out?

About $100.

Okay, so your actual cost is about $100, but you're probably going to close— what percentage do you think you'll close into new business?

Probably 75% of that.

Cool. Let's be conservative and say half. If you had to pay $200 in terms of CAC, who cares? Right? Right. And so that's the— that would be the offer that I lead with because that way you don't feel like you owe them. I mean, obviously you're going to want to try and refer business if you can, right? But this at least gives them real money, no extra work. Like, it's a compelling offer.

They just send it to us and we get it done.

Yeah. I don't think you're going to be able to do both of these.

Yeah, I agree.

So which one do you feel you would be like more equipped to do sooner?

Equipped to do sooner, I think outbound's probably easier.

Okay.

Because we can obviously have our CMO just start making those reach-out calls to see what's going on. Ultimately, I think that this is going to be very interesting for us. We want the activation. I think that at a certain point of just having people say, hey, this is the price, charge them.

So. Yeah, so if we're looking at a timeline, it's like probably for the rest of this year, you're just going to, it's going to take you to spin this up.

Right.

And so this is probably a 2026 thing.

Okay.

Realistically, because for each of these things, you basically need someone who's full-time in charge of it. As ugly as that sounds. But the thing is, it's going to be worth it because you're going to generate a bunch of business. If you get one more partner like your current one, it's already paid for itself. And I think that if one time one person's full-time, that's the only thing they're doing, they'll definitely do more than that. And then you run into supply constraints because you won't have enough guys, which we can deal with.

For our affiliate, I think that this is going to be a great program for us. And we always look at how we can give back to everyone around us. So this is going to fit our model and then just really explode the whole process.

Let's look at our overall— our overall improvements. We'll prioritize them. Does that sound good? I did. Okay. Number 1 is we're going to do price raise of 10%. So around $1,650 per unit. And as long as close rate stays above 65%, we're making money.

Okay.

2 is you're going to continue to pay off the debt. So we're going to, we're going to keep it debt paid. Number 3, change funnel. So optimize landing page and redirect buttons. So all the buttons on the site should now go to this new page that's already optimized. So number 4 is fix ads, which is Variety plus organic best performers. With a +5-second CTA. And then we're gonna increase ad spend now that we fixed these two things. So it's like, let's go make a better funnel. Let's go fix the ads. Then we will increase the ad spend. And we're just gonna keep doing this kind of infinitely. It should be a, there you go, forever.

And for the increase ad spend, what are you thinking? Like how much do I, do you want to, designate percentage based on, on that, or—

The reason that I do it in this order is because if we fix the landing page and we just improve the ads you have, you might already double or triple your lead flow. And so you might not even have to spend more because you might be like, shoot, I don't have enough guys, which is a problem I'd love to create for you. Then we go retargeting cross-platform plus own Google search terms. The last main one that we're going to do is just going to be outbound to HOAs. Like, you can do 1 through 4 in the next, like, 2 weeks, right? This is kind of like the first thing that happens. This then is kind of happening anyway, so there's not really any work that has to happen. These 2 happen together, these 2 will happen together, and then this would be the last thing that I would do.

Gotcha.

Because all of these might even result— you might be like, shoot, I don't even need to do these events yet. Like, we're already crushing it on this part. So I think that this could reasonably increase profit by 25% in profit. That will also, once you have to not pay off the debt, that'll increase your profit by like 5%, right? But at least 100% in headache. Yeah. This might be a 2x that's sitting right here for optimizing the pages. And it might be even more because you have your SEO that's going to feed into that too. Fixing the ads and organic like this could definitely be a 2 to 3x. I know that sounds wild, but like, I think you're getting by with the ads that you have because other people who are in your industry don't know how to advertise more than because the advertising's good. Right. The ad spend is just gonna be, you know, 1:1 ratio of basically your scaling. Okay. Right? If we can keep ROAS the same and we double it, then everything doubles down the funnel. Right? This is probably gonna be somewhere in the neighborhood of like a 10 to 20, I'll just call it a 10, Conservatively, I'll say it's about a 10, 10% lift, maybe 20% that you might get from the retargeting side. And then outbound is kind of like uncapped because you could figuratively just be like, I'm gonna go get 100 HOAs. And then like you're completely plugged in. You do that and you're at $10, $20 million a year. Oh, you know what? I forgot one. So 6 email reactivation.

Yeah, yeah, yeah.

There we go. And I think that can give us another, Probably 20 to 30% lift. Yeah. Money.

And that's, and that just keeps growing.

Well, the nice thing with things like that is that they do compound as the business grows.

Right.

And so you don't like, once that's installed, it just continues to print. Do you think this will help you grow?

Absolutely.

Sweet, man. Awesome. You feel good about this?

I do.

All right. Rock and roll, man. Drum roll, please. It's been almost a year since we filmed this episode with Corey. My team jumps on a call to check in on his progress and I'm gonna watch it live.

Hey, Alex. So, yeah, so when we were there originally for the recording, we were doing about $1.25 million in sales for the trailing 12 months. Currently, we are on our, on our goal here for $2.3 to $2.5 a year later. The biggest impact that really that we obviously went over with a lot of like my marketing, which we knew was an issue when we first got there. So went with a new third party that's been there, done that with many other companies before. So they've been amazing to work with. And again, our, our lead flow after kind of making some of those conversions from the landing page marketing, upping ad spend, we were sitting about 120 leads a month and now we're about close to 200, which is really great and they're higher quality. And then I'm excited and hopefully in the next 12 months we'll be looking at another location, which is super exciting not only for myself but for my team. I got some, some good individuals here that are looking for some new opportunities and I'm happy to be able to facilitate that. I just want to say I thank you and I appreciate all everything you do. And I love your mission, which again is like very similar to the way I go to help my clients. You do it for the right reasons and that's something I can respect.

Well, there you have it. That's Corey. Crushed it. Almost doubled within a year. Just walking through the stuff that we went through and all the credit really goes to him. I mean, at the end of the day, you can watch 100 of these videos, but if you do nothing with it, nothing's going to happen. So real businesses, real tactics, real shit. And hope to see you on the next one.