Episode Overview

Podcast: The Game with Alex Hormozi
Episode: 4. Premium Promotions | $100M Lost Chapters Audiobook
Air Date: November 14, 2025
Host: Alex Hormozi

In this episode, Alex Hormozi delves into the mechanics, benefits, and challenges of premium offers—high-ticket products or services with significantly higher profit margins. He draws from his own business journey and highlights the role of premium offers within larger business strategy, contrasting them with introductory, free, or discounted offerings. The episode is practical, including actionable math, psychology, and the step-by-step logic behind structuring irresistible premium promotions.

Key Discussion Points & Insights

1. The Power of Premium Offers

• Opening Story: Alex recounts a time at his old smoothie shop, reflecting on a news piece about a $50,000 burger and the relative value of money at different income levels ([00:00]).
  • Quote: "If he worked 2,000 hours in a year, he made $25,000 per hour. It cost him two hours of his time to afford the burger. Then I did the math on my own income... It would cost me the same two hours to afford burger, fries and a soda."
• Lesson: This illustrates the concept of relative value and sets up why high-ticket offers can be just as accessible (for the right audience) as discounted offers are to others.
  • Quote: "Given his income, it wasn't even insane. It was the same as me buying a burger." ([02:00])
• Pricing Principle: "There is no cap on the upside. You can only go down to zero when pricing." ([03:10])
• Big Advantage: Selling fewer, higher-value offers often dramatically increases profit without increasing effort or resources.

2. Comparative Profit Math

• Alex runs realistic numbers on profit margins:
  • Example: "$100 per sale with $50 profit" business needs 190 customers to earn $9,500.
  • A "$10,000 per sale with $9,500 profit" business only needs 1.
• Premium Offers Outperform: Even with lower volume, premium offers provide higher total profit and less operational drag.
  • Quote: "Using a high-value offer would make your advertising nine and a half times more profitable." ([04:45])
• Client Management: Fewer premium clients means business becomes easier to manage.

3. Essential Conditions for Premium Success

• You must:
  1. Have something truly valuable to offer (the "Grand Slam" offer).
  2. Have a selling process that demonstrates that value compellingly.
• Starting Out: For beginners or those starting over, Alex recommends first using free or discount models to get traction before pivoting to premium.
  • Quote: "If I lost everything and had to start over... I would not start with a premium offer. I would add on a free or discount money model." ([06:00])

4. Pros & Cons of Premium Offers (Role-Play Section)

• Alex flips the typical monologue, simulating a conversation with a skeptical partner ("me" vs. "you" dialogue).

Pros ([09:00])

1. Simplest Math/Fewer Moving Parts
   • Fewer products and variables make business math straightforward.
     • Quote: "If you're only selling one core thing, then the math gets pretty simple... You just look at what you spent and what you made."
2. Quality Customers / Lower Operational Drag
   • "People who come in on premium offers are in general the most qualified customers."
   • Less time spent sifting through low-quality leads.
     • Quote: "We skim with the marketing. But by doing so, you pay a premium for the cream inside of all that milk."
3. High Lead Quality (No Discounts/Incentives)
   • Everyone who enters the funnel expects a serious investment.
     • Quote: "There are very few transparent intentions on both sides. It comes down to how much they believe we can solve their problem and the perceived value of our solution."

Cons ([11:45])

1. Most Expensive Leads & Slow ROI
   • Premium offer leads are expensive; slow to break even.
     • Quote: "It costs a lot of money to get moving on this. Many don't have the cash to drive the volume."
   • Less room for learning through mistakes due to stakes per sale.
2. Requires Advanced Copywriting & Market Knowledge
   • Must deeply understand your avatar’s real world and motivations.
     • Quote: "Specificity is what gives copy its edge. Unless you know the real world of your avatar, it can be difficult to get them to bite."
   • Free/discount offers are more forgiving to mediocre copy, premium are not.
3. Requires Sales Skill
   • No discount templates or easy closes—all deals require strong sales processes and skills.
     • Quote: "The sales process will need to be structured based on the client avatar we're pursuing."
4. Inefficient for Capturing Volume
   • Low volume of leads/sales, so this isn’t the path to mass market share.
     • Quote: "If we are looking for volume, a straight premium offer is going to have to hit a lot of eyeballs before getting a bite."
5. Needs a Compelling and Irresistible Offer
   • Premiums only work if the perceived value dramatically outweighs the price.
     • Quote: "You will need to make sure that you have a truly irresistible offer...packed with bonuses, creative guarantees and premium support."
     • Callback to his book: "$100 Million Offers."

5. Strategic Takeaways ([19:00])

• Standalone Model: Premium offers can be a standalone business model, 2-5x pricing without changing much else.
• New Business Strategy: Start with free or discount, build reputation and proof, then introduce premium offers.
  • Quote: "If you're just starting out... then you'll likely want to wrap a premium offer with a free or discount wrapper."
• Hybrid Model: Layer premium offers after free or intro offers for best of both worlds.

Notable Quotes & Memorable Moments

• "There is no cap on the upside. You can only go down to zero when pricing." ([03:10])
• "Using a high-value offer would make your advertising nine and a half times more profitable." ([04:45])
• "People who come in on premium offers are in general the most qualified customers. This decreases the amount of sifting through the poo to get the best customers." ([10:55])
• "Specificity is what gives copy its edge. Unless you know the real world of your avatar, it can be difficult to get them to bite." ([13:40])
• "This is a recurring theme. I need to know what I'm doing." ([15:20])
• "You will need to make sure that you have a truly irresistible offer...packed with bonuses, creative guarantees and premium support." ([17:32])

Timestamps for Key Segments

• [00:00] - Opening story: $50,000 burger vs. $6.75 wage, relativity of premium value
• [03:10] - Pricing principle & upper limit psychology of offers
• [04:45] - Premium model math: per-sale vs. high-ticket sale, real-world business math
• [06:00] - Why not to start with premium, how to layer premium offers
• [09:00] - Pros of premium offers: role-play and explanations
• [11:45] - Cons of premium offers: detailed breakdown
• [17:32] - What makes an irresistible premium offer
• [19:00] - Strategic wrap-up: standalone vs. layered premium strategies

Conclusion

Alex Hormozi lays out a clear, actionable roadmap for understanding and implementing premium offers to dramatically increase profitability and streamline business. He punctuates tactical points with personal anecdotes, hard numbers, and role-player dialogue. For anyone considering transitioning to or layering in premium offers, this episode delivers both the "why" and "how," while reminding newcomers to establish trust and proof first, and to always anchor premium offers in genuine, compelling value.