High Ticket Vs Low Ticket – Which Business Model Will Help You Scale Faster?

In spite of the fact that there are ways to stack the deck in your favor, entrepreneurs often do the opposite, making the game much harder for themselves than it has to be.

I’ve seen it happen time and again while helping hundreds of people scale their business to 6 figures, 7 figures, and past 7figures.

Entrepreneurs often make it harder on themselves to scale their business even though a few tweaks to their strategy could help them easily scale their business past 7 figures.

Choosing the right business model is one of the most important things that can make your task of scaling much easier. In contrast, if you pick the wrong business model, your scaling efforts will turn into a long, slow grind.

So which business model should you choose to scale your business? This is what you’re going to discover in this post.

Since having the right offers is one of the simplest ways to stack the deck in your favor, I’ve created a 37-page pdf that goes in-depth about business models, how to create an irresistible offer, and how to develop and launch it the right way. Click here to check it out.

The Common Misconception When Choosing Your Business Model

I’ve always been fascinated by this.

Many entrepreneurs unintentionally design their business in a way that keeps them indefinitely stuck on the hamster wheel. 

Your business model and how your company’s offer(s) fit within that model defines the rules of the game you’re playing.

If you’ve got ineffective product offerings, you’re basically depending on good luck to get by, which is a poor strategy in any game of skill. Your business model should be deliberately designed so that it can operate like a finely tuned machine.

But even if you started out with a good business model, the truth is, what got you started in business, or to this point, won’t get you into the next stage of the business. It simply can’t. The product or service that brought you to $100K, won’t bring you to $1M or to $10M.

Most entrepreneurs attempt to scale a model, or edit their model, instead of starting by looking at what model can actually build their dream business and then working backward to figure out how to get to their goal from where they are now. 

Most of the time, the business model that will really allow you to scale will take you years to develop, and it will require a much larger team, better operations, kick-ass marketing, and systems that make your current scenario look like child’s play.

And if you scale the wrong model, you won’t have proportionally increased profits, you’ll need a team that’s far too big for the revenue that you’re pulling in, and even if your marketing is amazing, you might just lose more money every time you sell something, which means, the more you grow, the more anxiety you’ll have. 

Not exactly the way we want to grow a business, is it?

Why People Are Tempted To Start With A Low-Ticket Model (And Why It Reflects The Wrong Mindset)

When most entrepreneurs start their business, they start with the mindset of “I’ll start out by charging a relatively low amount, and then as I build up my credibility, my success stories, my confidence, and my audience, I’ll start to charge higher amounts.”

Unfortunately, this is a complete trap, especially when it comes to businesses built around coaching, consulting, training, information, transformation, etc.

In most cases, this business model, once it starts generating revenue, will inevitably create a hamster-wheel-style business cycle. 

Most businesses that take this route end up dying before they ever get to start creating and marketing the higher value offers.

Here’s why: When you’re starting at a low price, your first few sales are going to be comparatively easier. 

Once you get that first handful of sales, you’re hooked. You’re in business. 

What’s even more intoxicating, you get that feeling—the one where you believe you’re onto something significant.

That’s when you realize that in order to keep making these small sales, you need an audience. You need to make those sales while at the same time you invest money, time, and energy toward growing your audience.

And this creates a cycle that becomes exhausting to keep running. You might possibly reach a six-figure business operating this way, but you won’t be able to scale past that.

Without realizing it, you’ll soon find yourself totally overwhelmed and burnt out as you pour more energy into building your audience while at the same time you’re hustling more and more every month to generate sales. 

And you have to do all of this while trying to provide proper service to your growing client roster.

Welcome to the six-figure hamster wheel.

In this overwhelmed state, what ends up happening is that you start making some very common (and costly) mistakes and make short-term decisions that will impact the growth of your business in the long term.

One of these common mistakes is that entrepreneurs start investing in tools and automation far too early in their business.

They start implementing advanced marketing even before they know their customer avatar.

And they make these decisions because they’re overwhelmed and they’re looking for solutions, and automation and tools are fancy and they think they may solve their problems, but they don’t.

The problem is that your spending will increase (not to mention the human resources to implement and manage all the tools and systems). And yes, they may bring more cash but without you even noticing it, all that money is going right out of the door to pay the extra bills.

Which makes you hustle to get the next sale and the cycle is never-ending. Which keeps you stuck deeper in the hustle hamster wheel without the ability to actually scale your business.

The Alternative Choice (And Why It Makes Sense For Most Entrepreneurs)

Before you take my word for it, let’s imagine what would happen if you don’t go with the low-ticket model.

You decide, “I’m going to start off charging a few people more money, or what we call High Ticket, because I know I’m good at what I do and can deliver high-value results for people.” 

“And later, once I’ve accumulated some cash reserves, know my process better, and have some killer testimonials, then I can powerfully (from a place of abundance) scale my audience and begin selling some smaller offers.”

What’s the advantage of this approach? 

There are many but the most obvious is the higher revenue and higher profit margins that come with the high ticket offers.

And since you need fewer clients to have a successful business, there is less pressure to need to have a huge audience to make your business survive, unlike when you go with low-ticket offers.

Here’s another advantage that people rarely talk about: high-ticket businesses are usually more enjoyable to run when you attract the right clients that you love to hang out with.

This means that instead of being stuck in the hamster wheel grinding for months only to find out that your business isn’t moving forward and that you’re completely overwhelmed and burnt out, your business can be fun and something enjoyable to work at.

Not to mention that your growth will come more naturally and scaling is much easier this way.

This will provide your business with true freedom and abundance, having the resources and relationships to access whatever you want in your life.

And since you’ve got plenty of resources, you can provide a better experience for your clients and serve them better. This will provide you with a couple of bonus benefits that you probably weren’t even expecting, like:

  1. You’ll have customers for years (if not for life) because they enjoy the experience of working with you and can clearly see how it helps them
  2. Clients will send you more referrals, which means more revenue without actually spending another dollar on marketing, which helps you scale faster as discussed above
  3. Have powerful and effective testimonials. I’m not talking about plain testimonials that don’t even move the needle when it comes to making people who don’t know you purchase your product. Instead, you’ll get testimonials where your prospect/client will really express their excitement and gratitude for the opportunity of working with you.

If that isn’t enough for you, let’s do a quick comparison and see the difference.

Low Ticket Vs High Ticket Models Comparison

Let’s do a quick comparison to show you the difference in numbers, in case you still need more convincing.

Let’s assume that you want to earn $100k over the next ninety days.

The Low-Ticket Model:

Let’s assume that you have a $500 offer. To earn $100k over the next ninety days:

  • You’ll need 200 clients
  • 67 clients per month
  • 3.3 new clients EVERY SINGLE BUSINESS DAY!
  • 10+ sales opportunities per business day.

You’ll need a large audience and a big ad budget to constantly get 10+ sales opportunities per business day.

Let’s look at the High-Ticket model and how it fares.

The High-Ticket Model:

What if you instead had a $10,000 offer. To earn $100k over the next ninety days:

  • You’ll need 10 clients
  • 3.3 clients per month
  • Less than one new customer PER WEEK!
  • Approximately one sales opportunity every two business days.

The difference in numbers is huge. You don’t need to focus all your time and energy on getting more people. You could focus instead on providing a better experience for your clients.

And your profit margins will be much more, so it’ll be much easier to scale without being overwhelmed.

I want you to actually stop for a second and think about the level of marketing that’s needed for 200 customers versus 10 customers.

When you’re just starting out, your marketing is going to be more organic and relationship-driven. 

That’s how it is in the beginning with most entrepreneurs whom I’ve helped learn to scale their businesses, and I had the same experience when I was just starting out.

Yet people come to me thinking they’re going to grow with just a membership that costs $47 a month.

I have nothing against memberships. I’ve built and overseen the growth of massive membership programs, but think about the cost of getting a new customer, the daily grind of maintaining such a system, and ever-increasing operations costs.

Can you actually get 1,000 people to buy something with the low profitability that you have?

Will you be able to actually provide those 1,000 people with true value and impact their lives?

Don’t forget that you’ll have to get another 100 per month to replace the people who are going to leave.

It’s a big hassle.

And we haven’t even mentioned validation yet. How much money will you need to blow before you make sure that your marketing and sales processes work?

Will you be able to build a profitable business that’s going to scale this way? Maybe, but it will take you a lot of time, a lot of capital to blow, and not to mention the hustle, overwhelming stress and burnout that you’ll feel throughout the entire process.

Having built MASSIVE memberships, courses, e-books, and everything in between, here is the harsh truth that I realized after years of experience…

It takes the same amount of effort to sell something that costs $100 as it does for something that costs $10,000. The difference is, you don’t have to sell to anywhere near the same amount of people.

Does That Mean You Shouldn’t Go Low-Ticket “At All”?

High-ticket is the easier business model to build and scale “most of the time.” That doesn’t mean low-ticket always sucks.

I’ve had dozens of clients who’ve had success going low-ticket then high-ticket.

It depends on different factors, like your market, your offerings and what you want. Do you want to just build a 7-figure business fast, or do you want to have more freedom even if that means less revenue?

High Ticket is the easiest model when it comes to building and scaling your business to 7 figures. You could focus on that model until you have a 7-figure business, then go with low-ticket to earn revenue from your audience and get them started in your business and then get them to your high-ticket offers.

Just like how I did my 5-day Marketing and Sales workshop that ended up generating nearly 90k the first time I did it in the front-end, but then it generated around a million dollars in the back-end from high-ticket sales. You can check out this video to learn more about it.

I also nowadays send cold traffic from ads to a low-ticket funnel to purchase my book The Nuclear Effect, which helps me grow my audience and offset 80% of the cost to get that traffic. So instead of spending $20,000, I can instead spend $100,000 and grow my audience faster.

Low-ticket still has a place in your business growth strategy. Using a high-ticket business model may be a better first move to validate your business and get growing faster, and then you could use low-ticket offers with high ticket offers to scale your business even faster.

Stack the deck in your favor.

You too can scale your business to 7 figures and beyond.

And if you want to go more in-depth about how to create the right offer, and how to validate it and launch it, make sure to grab this 37-page pdf that I created all about offers. It’s everything that I’ve learned about offers after helping hundreds of entrepreneurs scale their businesses.

Click here to grab Your Offer guide now.

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