Biggest Lesson From Hormozi 1-Day

Andrew Kirby

6d ago in Strategy

The winners of July Skool Games flew to Vegas for 1-Day with Hormozi.

I spent 8 hours at the 1-day, this was my biggest takeaway:

Every paid community can make roughly 2.5x more money by turning on annual payments.

Here's 7 reasons why (according to Hormozi):

Higher Cash Flow

“Annual payments boost upfront cash flow by 2.5x compared to monthly” - Hormozi

Example: Offering a $1,000 annual plan instead of a $100/month plan generated $20,000 from 20 annual buyers upfront, versus $8,000 from 20 monthly buyers.

2. Improved ROI Window

Annual billing gives a 365-day window to prove ROI, as opposed to monthly where results must be justified every 30 days.

Example: A customer who might cancel after a few bad months is less likely to do so with an annual plan, where they see the value over a longer period. The results in month 1 can justify the whole year.

3. Reduced Churn

Annual billing leads to lower churn and higher retention (2% for annual vs. 10.7% for monthly), keeping customers longer.

Example: Companies saw 4x lower churn with annual plans based on ProfitWell data. (Skool will have specific churn data once Annual has been out for longer)

4. Increased Lifetime Value (LTV)

Charging more upfront increases LTV.

Example: If your average retention is 3 months, then each member at $100/month LTV is $300. By charging annually you increase retention from 3 months to 12 and improve LTV to $1,000.

5. Ad Profitability

Increased upfront cash flow from annual memberships allows for more aggressive advertising and higher ad spend, making your ads more profitable.

Example: A business that 2x-ed cash flow through annual sales could reinvest the funds into more ads, scaling faster.

6. Easier Upsells

Customers are fractal. 20% have 5x the buying power as the other 80%. Annual buyers are more likely to spend more and upgrade to other higher-ticket offers. They are your most valuable customers. Nurture them.

Example: Offering an annual plan with exclusive bonuses led to higher upsell rates into VIP programs and events.

7. Higher Retention Strategies

Sell the year, but deliver every single month. Don’t let off the gas pedal.

Example: Annual members who received extra onboarding calls and personalized attention had higher satisfaction and renewals.

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