Introduction

When I first read Alex Hormozi’s books, $100M Offers and $100M Leads, it felt like someone handed me a treasure map that I never knew existed. The concepts he laid out were so simple, yet they hit me like a revelation. They weren’t just about making offers—they were about making offers that are so good, they become impossible to refuse. It wasn’t just theory; it was practical, actionable advice that could be applied to any business.

Reflecting on my own entrepreneurial journey, I can’t help but think, “What a pity I didn’t have this knowledge when I started!” I made all the classic mistakes—focusing too much on the product and not enough on what the customer actually wanted, overcomplicating the value proposition, and assuming people would naturally understand why my offer was better. But the truth is, no one owes your business their attention. You have to earn it, and the foundation of that is a truly great offer.

The principles I learned from Hormozi’s books have stuck with me ever since. They’ve not only changed how I view my business but also how I think about value itself. And here’s the kicker: most companies don’t have a truly great offer. Even those that think they do are often missing key ingredients that would make it irresistible.

In this article, I’ll dive into what makes a great offer, using Alex Hormozi’s Offer Equation as the framework. I’ll break down each part of the equation, explain why it matters, and show you why so many businesses fail to get it right. But first, let’s talk about the foundation of a good offer: understanding what your customer truly wants.

The Offer Equation: Explained

At the heart of a good offer lies Alex Hormozi’s Offer Equation, which he outlines in $100M Offers. This simple yet powerful framework breaks down the key elements of creating an irresistible offer, one that eliminates customer objections and maximizes perceived value. The equation goes like this:

Value of the Dream Outcome × Perceived Likelihood of Achievement
--------------------------------------------------------------------
Time Delay + Effort and Sacrifice

Let’s unpack each of these components and see why they matter.

1. Value of the Dream Outcome

This is the “end result” your customer desires—the reason they’re even considering your offer in the first place. A good offer doesn’t just sell a product or service; it sells a transformation. It’s the difference between selling a gym membership and selling the promise of a healthier, more confident version of yourself.

To maximize the value of the Dream Outcome, you need to deeply understand your customer’s aspirations. Ask yourself:

• What do they truly want to achieve?
• How does achieving it make them feel?
• What’s the emotional and practical impact of their success?

A weak offer focuses on features; a great offer paints a vivid picture of the result.

2. Perceived Likelihood of Achievement

Even if the outcome is enticing, customers need to believe they’ll actually get it. If they doubt your ability to deliver, the value of the offer plummets. This is where trust and credibility come into play.

You can increase the Perceived Likelihood of Achievement by:

• Providing Social Proof: Share testimonials, case studies, or before-and-after results.
• Offering Guarantees: Reduce risk by ensuring customers feel safe making the purchase.
• Being Transparent: Clearly explain how your product or service works, step by step.

Think about it this way: a lottery ticket has a massive Dream Outcome, but the Perceived Likelihood of Achievement is so low that most people won’t spend much money on it.

3. Time Delay

How quickly can your customer experience the desired outcome? Speed is often a critical factor in the attractiveness of an offer. The longer it takes to deliver results, the less appealing the offer becomes.

For example, a weight-loss program that promises visible results in 30 days is much more enticing than one that guarantees results in 12 months. Customers are impatient—they want results now.

You can reduce Time Delay by:

• Breaking down the process into quick wins.
• Offering a “fast-track” option or premium service.
• Simplifying onboarding to get started immediately.

4. Effort and Sacrifice

This represents the perceived hurdles your customer needs to overcome to achieve the outcome. Effort could include time, physical energy, or even mental strain. Sacrifice might mean giving up something they value—money, comfort, or habits.

For instance, consider why meal delivery services like HelloFresh are so popular. They don’t just promise great meals (Dream Outcome); they minimize effort (no grocery shopping, no complex recipes) and sacrifice (time saved).

To reduce Effort and Sacrifice, you should:

• Streamline the process for customers.
• Offer done-for-you solutions or add-ons.
• Address objections proactively (e.g., “No cooking skills required”).

By understanding and optimizing each part of this equation, you can create an offer that doesn’t just compete—it dominates. In the next section, we’ll explore why most companies fail to apply these principles effectively and end up with offers that fall flat.

Why Most Companies Don’t Have a Good Offer

Despite the clarity of the Offer Equation, many companies struggle to implement it effectively. They may focus on one or two elements while neglecting others, failing to see it as a complete system where every part is interconnected. The result? Offers that fall flat because they don’t address the full scope of what makes an offer irresistible.

Let’s examine why this happens and how businesses can avoid these pitfalls.

1. Misaligned Focus: Features Over Outcomes

One of the biggest mistakes companies make is prioritizing product features over customer outcomes. They dive deep into what their product does—its specifications, technical capabilities, or unique features—without communicating the transformation it enables for the customer.

Customers aren’t buying a product; they’re buying a result. A software company might advertise its “AI-powered analytics engine,” but what customers truly want is actionable insights to save time and grow their business.

How to Avoid This:

• Shift your messaging from “how it works” to “what it delivers.”
• Use emotionally resonant language to highlight the end result your customer craves.

2. Neglecting the Full Equation

Another common issue is that companies focus heavily on one part of the Offer Equation, such as the Dream Outcome or reducing Time Delay, while neglecting others. This fragmented approach ignores the fact that the Offer Equation functions as a complete system.

For example, you might offer an incredibly fast solution (low Time Delay), but if the customer doesn’t believe they’ll achieve the promised result (low Perceived Likelihood of Achievement), the offer will still fail. Similarly, a compelling Dream Outcome loses its allure if the effort and sacrifice feel overwhelming.

Every part of the equation matters, and the magic happens when all elements work together. A truly great offer reduces risk, maximizes perceived value, and makes the decision to buy almost automatic.

How to Avoid This:

• Always evaluate your offer as a whole. Ask yourself: “Is this irresistible in every aspect?”
• Continuously refine each part of the equation while ensuring they align to create a seamless experience.

3. High Perceived Effort, Sacrifice, and Risk

Customers don’t just invest money—they also invest their time, energy, and trust. If the perceived effort or sacrifice feels too high, they’ll hesitate to act. Companies often overlook this by failing to address the risk customers feel when committing to an offer.

Customers ask themselves, “What if this doesn’t work? What if I waste my time and money?” Without clear risk-reduction techniques, the decision becomes far more difficult.

How to Avoid This:

• Incorporate Risk-Reversal Techniques: Use guarantees like “money-back,” trial periods, or “results in 30 days or your money back” to build trust.
• Streamline the Process: Make onboarding effortless and break commitments into manageable steps to reduce perceived effort.
• Show Proof: Use testimonials, case studies, and success stories to build confidence.

4. Lack of Understanding of Customer Needs

The most irresistible offer is built on a deep understanding of the customer’s pain points, desires, and fears. Yet, many companies don’t invest the time to truly know their audience. They create offers based on assumptions, leading to mismatches between what they provide and what customers actually want.

How to Avoid This:

• Conduct customer interviews, surveys, and research to understand their true motivations.
• Focus not just on logical needs but on emotional drivers like security, pride, or relief.

5. Being Too Caught Up in the Day-to-Day

Finally, many companies don’t step back to evaluate their offers as a whole. They get stuck in operational tasks, assuming their current offer is good enough without questioning whether it could be improved.

How to Avoid This:

• Regularly review your offer through the lens of the Offer Equation.
• Ask for customer feedback to identify gaps and opportunities for improvement.

Key Takeaway: The Whole Equation Matters

The biggest mistake companies make is treating the Offer Equation like a checklist rather than an interconnected system. You can’t just focus on reducing Time Delay while ignoring Effort and Sacrifice. You can’t promise a life-changing Dream Outcome without addressing the Perceived Likelihood of Achievement. Every part matters, and every part must work together to create an offer so good it’s almost impossible to refuse.

When you align all elements of the equation, you create an irresistible offer—one that not only attracts clients but turns them into raving fans.

How to Create a Good Offer

Now that we’ve explored the Offer Equation and why many companies fall short, let’s focus on how to craft a truly irresistible offer. Using Alex Hormozi’s framework, here’s a step-by-step approach to ensure your offer not only resonates but compels customers to act.

Step 1: Identify Your Customer’s Dream Outcome

The foundation of a great offer is a deep understanding of what your customer truly wants. This goes beyond surface-level desires and dives into the emotional and practical outcomes they’re hoping to achieve.

How to do it:

• Ask the right questions: What transformation does your customer want? How will it change their life or business?
• Paint a vivid picture: Don’t just describe the end result—make it tangible. For example, instead of saying “increase revenue,” say “double your income and enjoy more time with your family.”

Example: A personal trainer shouldn’t just sell “fitness sessions” but the promise of “a stronger, more confident version of yourself in just 90 days.”

Step 2: Increase the Perceived Likelihood of Achievement

Even the most enticing Dream Outcome won’t matter if customers doubt they’ll achieve it. Building trust and credibility is critical to overcoming skepticism.

How to do it:

• Show proof: Use testimonials, before-and-after stories, and case studies to demonstrate success.
• Simplify your process: Clearly outline how you’ll help the customer achieve their goal. A step-by-step roadmap builds confidence.
• Guarantee results: Offer risk-reduction techniques like a money-back guarantee or “no results, no charge” policy.

Example: A marketing agency could promise, “We’ll double your leads in 60 days, or you don’t pay.”

Step 3: Reduce Time Delay

Customers want results quickly. The longer it takes to see progress, the less appealing the offer becomes. Shortening the time to results makes your offer more compelling.

How to do it:

• Create quick wins: Break down your solution into smaller, achievable milestones that customers can see early on.
• Offer premium options: Provide expedited or fast-track services for customers willing to pay more.
• Be transparent about timelines: Clearly communicate how long results will take and what they can expect along the way.

Example: A resume writing service might say, “Get an optimized resume within 48 hours, and start receiving job interview calls within a week.”

Step 4: Minimize Effort and Sacrifice

Customers are naturally resistant to expending too much effort or giving up too much to achieve their goals. Your job is to make the process as seamless and frictionless as possible.

How to do it:

• Simplify onboarding: Make it easy for customers to start using your product or service.
• Offer done-for-you solutions: Reduce customer involvement by handling the heavy lifting for them.
• Remove hurdles: Eliminate unnecessary steps, such as overly complex forms or confusing pricing models.

Example: A business consultancy could provide, “We handle all the research and implementation—you just reap the benefits.”

Step 5: Think Holistically

As emphasized earlier, the Offer Equation is a complete system. Every part of the equation—Dream Outcome, Perceived Likelihood of Achievement, Time Delay, and Effort and Sacrifice—must work together to create a seamless, irresistible offer.

How to do it:

• Continuously review your offer through the lens of the full equation.
• Test and refine each component to ensure it supports the others.
• Think about your offer from the customer’s perspective: Is it easy to say “yes”?

Example: A meal delivery service could combine:

• A Dream Outcome: “Delicious, healthy meals your family loves.”
• Perceived Likelihood of Achievement: “Rated #1 by 10,000 happy families.”
• Reduced Time Delay: “Delivered to your doorstep within 24 hours.”
• Minimized Effort: “No cooking required—just heat and eat.”

Putting It All Together

Crafting a great offer isn’t just about tweaking one or two parts of the equation; it’s about creating a harmonious system where every element reinforces the other. When you combine a compelling Dream Outcome, high Perceived Likelihood of Achievement, minimal Time Delay, and low Effort and Sacrifice, you have an offer that not only attracts customers but converts them into loyal advocates.

In the next section, we’ll wrap up with actionable takeaways and a motivational push to rethink your current offers.

Closing Thoughts

Creating a great offer is both an art and a science. It’s not about finding one magic ingredient but rather mastering the entire equation. By understanding and applying the principles of Alex Hormozi’s Offer Equation, you can create offers that are so good, customers won’t just want them—they’ll feel like they need them.

Key Takeaways

1. Every Part of the Equation Matters: The Dream Outcome, Perceived Likelihood of Achievement, Time Delay, and Effort and Sacrifice must work together seamlessly. Neglecting one part weakens the entire offer.
2. Think Like Your Customer: Step into their shoes. What do they truly want? What fears or doubts might hold them back? Address these questions with empathy and clarity.
3. Reduce Risk and Friction: Make saying "yes" the easiest decision your customer can make. Use guarantees, quick wins, and streamlined processes to lower barriers to entry.
4. Iterate and Optimize: Even a good offer can be improved. Regularly test and refine your offer based on feedback and results.

A Final Challenge

If you’re a business owner or marketer, take a hard look at your current offer. Does it inspire confidence? Does it feel irresistible? If not, identify the weak points in the equation and start fixing them. Remember, even small adjustments—like adding a guarantee or simplifying onboarding—can make a massive difference.

Hormozi’s framework is a tool, but it’s up to you to use it effectively. The beauty of this approach is its universality—it applies to any industry, any product, and any audience. So take the time to rethink, refine, and elevate your offer. Your future clients (and your bottom line) will thank you.

If you haven’t already, dive deeper into Alex Hormozi’s work by reading $100M Offers. It’s a game-changing guide to mastering this art. And if you’re ready to take your offers to the next level, start by asking yourself: What’s the one thing I can change today to make my offer irresistible?