I wrote this post for my own blog, but thought it would make a good first post here too... I called this post 'Fear and Greed' as that seemed to be the overriding psychological emotion at the conference!
Recently I spent last weekend, along with 4,500 other people, at an internet marketing conference in the UK.
On my train journey home, I reflected on what I could take away from the conference which is pertinent here.
My thoughts are this:
1. Repeat Selling
One of the key messages from the 15 different speakers was the need to repeat sell to existing customers.
Although the conference was predominately about the various forms of internet marketing, all the speakers agreed upon one thing. This was that the most important asset in any internet business is its database of existing customers.
This is simply because having a customers contact details allows the entrepreneur to repeat market and sell to that customer many times in the future.
Maximising the life-time value of a customer is one of the central themes of my blog, and is just as relevant in an traditional company as it is in an internet company.
The cost of finding a new customer on the internet through google adwords, traditional search traffic (including SEO), or joint ventures, is expensive and competition is high.
But when you find a customer, and then repeat sell to them, (for example through internet membership sites, offering greater value services or back-end products), a low cost £20 initial online sale, can turn into a very profitable lifetime customer.
Just think of Amazon, this is exactly what they do.
Very few people purchase just once from amazon, as they make it incredibly easy to buy and buy again. They even offer a premium annual membership which provides free shipping.
It is clear then, that even in the world of internet marketing, life-time value is at the forefront of business-owner-thinking.
2. Selling vs Buying
The second thing I took away was the shear power of a persuasive salesperson. Each of the 15 professional speakers were outstanding sales professionals themselves, and through their powerful communication, and tugging on the twin emotions of greed and fear, had customers — literally — running to the order desk with their credit card.
It was an interesting experience to say the least! One I learnt a lot from, but didn’t necessarily enjoy a great deal.
What however can you and I take away from this lesson in master salesmanship, given that we may not be master salesmen in this same way, and given that we may not have a room full of ‘hungry to buy’ prospective customers?
The answer is found in the 90% to 95% of people who didn’t rush to order with their credit card.
The reason I believe they didn’t rush up is because customers like to buy, and don’t like being sold to (and they don’t know who to believe).
The 90% to 95% of people who didn’t buy, still need the products and services offered by the speakers, but didn’t have enough belief that the product (or speaker) was right for them.
However, if an impartial friend or relative made a suggestion, then I confident the percentage of people who bought would have been higher.
The conclusion I therefore came to is this: in a market place where all products have a similar ‘big promise’, and the salesmanship is at the highest level, for a confused buyer, they rely more on impartial word of mouth recommendation than on slick, glossy salesmanship.
Selling is obviously about selling to a customer (often using immediate emotional influence), but word of mouth is about creating a network of customers who want to buy, even when they are outside of the emotionally charged sales arena.
3. Value vs Price
The third point I’d like to share from my weekend at the marketing conference was a phrase that one of the speakers used, which was this:
“In the absence of value, price becomes the issue.”
This is something I believe each of the internet entrepreneurs understood very clearly — and practiced.
Each of the 15 speakers had roughly 90 minutes on stage, with their presentations being a mixture of content and selling. But even their content, which was usually interesting, was laced with selling messages, all the time building up the value of their content.
What the speakers did extraordinarily well to close their speech, and therefore to close the sale with the 4,500 prospects in the room, was to put together an offer which was so undeniably high in value, that price became almost irrelevant.
One speaker built his package of products to be valued at over £52,000.
He simply kept layering on top of one product, another, plus another bonus, additional mentoring services, another product and another bonus — each time building up massive value, and at the same time, bringing down the price of his offer to an affordable level of around £5,000.
Price in the end became irrelevant against the backdrop of the perceived value of the packages which were offered.
The way it was presented, and the pure salesmanship was examplorary. In any other circumstance, price WOULD be an issue, but they demonstrated so much value throughout their presentation, and with their offer, that price was not the relevant concern.
Getting your order placed before time ran out on the ticking clock was NOW the issue.
If you have ever read Robert Cialdini’s book ‘Influence’, you will know that creating an environment of scarcity is one of the primary drivers of influencing people to buy. This was proved by the hordes of people who ran to place their order form before the speaker had even finished his presentation - simply because he said their were limited places, and the offer was only good for 10 minutes!
These people I think paid around £3,500, and I estimate there were between 125 and 225 people who took the speaker up on this particular offer.
4. Risk Reversal
The last point I’d like to share from my weekend at the conference is a word on risk reversal and taking the risk away from your customer.
For some years now I’ve been interested in the principles of Direct Response Marketing, and the internet marketing fraternity are masters of using these principles and practices. In a future blog, I’ll share my own thoughts and experiences of this interesting and profitable subject.
But one of the key principles, which I’m a great believer in, is to reverse the risk for the customer.
Getting that first sale with a customer, whether it is a low cost £20 sale, or a relatively high-value £3,500 sale (as it was in the internet marketing environment), is still a risk to the purchaser.
But, if in your offer you can entirely remove the risk for them, so if they want to return their products within 30 to 60 days, and in some cases a year, then that has to be a good thing for the customer.
Very few people outside the world of Direct Response Marketing do this, yet I believe that to demonstrate your own belief in your own products and the results they deliver for people, risk reversal is a great strategy.
If you are looking how to get people to buy in the first instance, if you can take the risk away from them, so you can demonstrate the results you can achieve for them, that is something I highly encourage and am greatly in favour of.