“I’m going to make him an offer that he can’t refuse.” ~Don Vito Corleone
The movie The Godfather anchored this phrase in concrete as a promise that if you don’t act now, there very well might be consequences. In the case of a famous mob family, it could mean a dirt nap, or sleeping with the fishes. But when it comes to doing business, no other phrase sums up the fact that making money is always a result of creating an offer that is impossible for someone to refuse.
As the purse strings tighten, our first reaction is to advertise a sale in hopes of opening the flood gates to an influx of customer traffic. But in reality, discounting our product in order to garner repeat customers is bad for business! Hands down, the worst thing you can do is to subtract from the overall value of your product or service. If a customer truly wants to buy what you have, they will make the purchase regardless of the price. I refer to this as “Death by Discount!”
Do you recall the huge online coupon boom? You would receive an email or text message that announced an awesome sale from a local retailer. The sale was only became a reality if enough of your peers accepted the offer. After that, you could go into the store and claim your discount.
Wow! 50% off of that sweater you’ve had your eye on for months! What an awesome deal.
That deal was only awesome for the customer that took advantage of it. The store owner ate a large chunk of the total cost. As a result, they lost money on the deal, and now have given that customer a taste of what could happen if they just exercised some patience, and waited for that next email. The offer backfired. Now, we’ll call her Sue, will only visit that store when there is an opportunity to save money. Sue will not become a repeat customer. Even worse, Sue will tell all of her shopaholic friends about the offer and how easy it was to redeem. Sue will update her Twitter status, and author a post on Facebook. Thousands will now hear about your business, but will been exercising the same newly found patience as Sue.
An offer does not have to save the customer money in order to be compelling. What you sell, if designed correctly, should sell itself. If your advertising conveys the benefits that come as a result of someone buying your stuff, you should never have to discount your price. Explain why, I as a person looking to spend money, can’t live without your product or service. What about your offer is different from that of a competitive retailer?
Make me an offer that I can’t refuse!
Cheap means just that…CHEAP! Quality is always accompanied by a higher price tag. If what you sell is exceptional quality, than allow your price point to reflect the same. I don’t want to read on your entrepreneurial tombstone that you perished as a victim of Death by Discount!
I will close out this post with a short story that fits well with my message. I’ll change the names for privacy sake, but the information is true.
Jane owned a small jewelry shop in Southern New Mexico. Along with traditional diamonds and gems, Jane sold handcrafted Native American turquoise necklaces. Although they were lovely, and the craftsmanship was amazing, Jane had a hard time selling them. Her business was successful, so she didn’t think too much about pushing the turquoise. If her customers didn’t want it, then she wasn’t going to cram it down their throats. One day, Jane noticed that she needed some shelf space. She instructed her sales associate to advertise the turquoise for ½ off. But Jane’s penmanship was sloppy, and the clerk received the message as X2. She took action, and doubled the sales price of the necklaces. The next day Jane had returned to find the necklace display empty. When she started to talk about the sale with her employee, she was surprised to learn about the mix up. The necklaces sold out at over twice their advertised value. The exceptional quality was only acknowledged after the price tag matched the overall value.
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