The Power Of A Guarantee

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Guarantees have so much power that they not only increase the responses from your marketing but also increase sales dramatically.

Don’t just reverse the risk—remove it

Consider this fundamental point: When customers make a purchase, they take a risk that the product or service will work.

Some prospects (often many of those you don’t convert) choose not to do business with you because they’re concerned whether they’ll receive value for money and whether what they’re purchasing will live up to the promises being made. That risk stops them in their tracks.

You might know your products and services are good, and you’ll do the right thing, but they only have your word on that. And that’s the risky part.

They’re thinking this as they look at your product or service:

‘What if this product or service doesn’t do what you said it would? What if I lose my money on this? What if it’s the wrong colour, size, type, or style? What if you don’t do what you say you will (like the last person I dealt with in your industry)? What if I don’t like it once I get back to my office or home? What will my partner say about this?

When you think about it logically, the fact that they’re taking the risk must hamper the decision-making process. In a lot of cases, it delays the decision. And that customer never buys the product or service.

So fundamentally, then, by removing the risk (that is, making it clear there’s absolutely no risk to the customer by investing in a product or service), the business will gain more customers.

That is a simple proposition, isn’t it?

But simple as it actually is, most businesses don’t do it. And if they do, most guarantees you find in the market have little power. They have ‘weasel wording.’ This kind of guarantee gives (little) with one hand and takes away with the other. They don’t work. They do nothing. At best, customers are sceptical.

Customers are often sceptical about guarantees ONLY because businesses have a history of offering guarantees that aren’t really guarantees at all—the offers use ‘weasel wording’ and double-speak.

Often, because of past experience, customers simply don’t believe these heavily worded, fine-print, covered, if, but, and maybe types of guarantees. In fact, it will send customers away from your business.

It’s for this exact reason that a bold, compelling guarantee, which reverses the risk and removes the ‘risk factor’ for the customer, offers you a MAMMOTH opportunity to grow your business and really stand out in the marketplace.

Let’s imagine that you double your sales by having a guarantee so powerful it’s hard to resist. (Guarantees can be so powerful that they can increase the response to your marketing material alone by up to 350%.) And let’s suppose that 10% of your customers claim the guarantee unfairly (the number simply won’t be that high—statistical research by Christopher Hart, author of Extraordinary Guarantees: A New Way to Build Quality Throughout Your Company and Ensure Satisfaction for Your Customers [out of print] says it’s only 0.1%). You’re still ahead by miles because of the extra business you’ve won in the meantime!

So the mind-set that suggests that offering powerful guarantees will send you broke is, in fact, the exact opposite of what will happen!

The idea of making policies to combat the small percentage of people who are dishonest is a little bit like shooting yourself in the foot. Those rules, which often mean your guarantee is watered down—or worse yet, missing—adversely affect the huge percentage of people (99.99%) who are honest. Worse yet, you miss out on COLOSSAL sales opportunities.

Will your customers take advantage of you when you offer a strong guarantee? A few will, but the money you lose is a tiny fraction of the increased sales you’ll experience by offering the guarantee in the first place.

My first business was a furniture removal company. Moving house is one of the 3 most stressful things you can do in your life. Our Guarantees were all “Stress Reducing.”

One in particular was called the 7 Day Shuffle. Our customers loved it and I’ve never seen another removal company guarantee it.

Here’s how it worked….one of the big decisions when you get to your new home is where to put the new furniture while the removalists are there to help shift it.

This can add time while people choose which was both a FRUSTRATION for the customer and me the business owner. The 7 Day Shuffle fixed that.

We guaranteed that we would return to the customers home and shift any furniture that the customer wanted us to move having lived with it for 7 days…FREE OF CHARGE.

Now you might be thinking ‘that’s crazy’…people will take advantage of our good nature and it would cost us a fortune in wages to honour the guarantee.

Well I can tell you that our sales jumped by over 63%…

And only 2% of customers asked to come back and move any furniture..

So as you can see if you have a Guarantee that solves a Major Customer Frustration then it can lead to increased sales and also increased referrals which reduces your need for expensive marketing.

So how do you make it work for your business?

To really work for you, your team, your business, and your customers, the promise in the guarantee can’t simply be a marketing tool. It must be built into the operational structure of the business. In other words, your business must be able to deliver on the promise.

It’s important to look at your company’s track record on customer satisfaction. A company probably shouldn’t consider an implicit guarantee if it doesn’t have a well-established history of bending over backwards to satisfy customers, or isn’t interested in becoming so. Where do you think you stand?

“The promise can’t simply be a marketing tool. It must be built into the operational structure. And the guarantee must be so self-punitive, the costs of mistakes so high, that producing the promised result is the only a bit more permanent than this year’s hot marketing gimmick.

Shout it from the mountaintop

Once you’ve created your guarantee, it can become a key element in all your marketing material. You see, you need to tell all your prospects about your guarantee before they buy from you.

This guarantee differentiates you from your competitors. Even if some of them offer a guarantee, they won’t be articulating it this way. And a guarantee means something only when it is spelled out clearly for a potential customer.

It will add another significant point of differentiation between you and your competitors, and could help educate your potential customers to the benefits of paying a higher price for a better service.

So the key is to promote, promote, promote. Shout it from the mountaintop, tell everybody, and you will win customers hands down!

The way you articulate your guarantee through your marketing has an effect. It has been proven that a guarantee can increase the response to your marketing material, ads, and direct mail letters, for example, by up to 350%. That on its own makes guarantees worthwhile!

One final point

It goes without saying, you must willingly, happily even, abide by your guarantee at all times.

Research has shown only 1 in 27 people complain when they have a problem. The trouble is, those 26 people who don’t complain will on average tell 10 other people about their bad experience—and you’ve never had the opportunity to make it right with those 26 customers.

The interesting point about guarantees is that customers who have called on them are actually more likely to buy from you again than any other group!

Research has shown that 84% of people who have had no problem dealing with you intend to purchase again. 92% of people who have had a problem resolved satisfactorily intend to purchase again and only 46% of people who have had an unresolved problem intend to purchase again. That’s really interesting, isn’t it? All the more reason to hand the guarantee over with a smile on your face!

Our way of doing things is unique and it’s why it produces unique results for our clients…

We would love the opportunity to help you clear your head on what is the right way for you to accelerate your business… 

We highly recommend you watch this step-by-step case study of how we grew Beefy’s Pies into a Famous Aussie Icon from a small stressed out bakery into a family owned chain. Click here to get all the insights into their success…

Or if you have heard enough about how we work with our small business owners, then let’s have an off the record chat about your current situation and see what we can do to immediately guide you…click this link to see what time best suits you.

P.S. Ask if our Boardroom Program intake is open for enrolments…It works best for business owners who see the benefit of having us on as their ‘external partner’ so that they are not alone in the day to day decisions of their business. 

One of the most valuable activities you can do as a business owner and sales professional is to build relationships with people. High quality relationships are not built around a desk.

Try this: Identify the biggest 20% of the relationships you have in your business and go out there and talk to them. Get rid of your desk for 14 days and do just that.

Connect up with your top clients/prospects/centres of influence and see what comes of it. I assure you, you’ll get rid of your desk in an instant on the 15th day.

My accountant did just that, except he didn’t wait until the 15th day. He did it on the first day he heard about this lesson.

It’s what I truly admire about him. Many people over-analyseo an idea, and they do that as a habit over many things in their business. As a consequence they delay progress. They become their own worst enemies in moving their business forward.

Here’s what my accountant did:

Despite having a schedule full of client appointments the next day, it didn’t stop him from removing his desk, removing all shelving, removing all cabinets and removing all traces of paperwork. All he had left in the room was his trusty whiteboard on the wall and four chairs.

No desk.

 

 

Our way of doing things may or may not be right for you…

Either way, it’s always good to get a second opinion on your business situation.

Let’s have an off the record chat about your current situation…click this link to see what time best suits you.

Wayne Hutcheson

P.S. Ask if our Boardroom Program intake is open for enrolments…limited to 8 Businesses.

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About the Author:

Wayne Hutcheson is a Coach of the highly regarded Grow Business Grow Boardroom Program. He works closely with a hand full of clients to help them achieve growth in their business and to enjoy 'guilt-free' time away from their business without it affecting their profitability.
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