The Secret of Charley Hill's Success

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By all appearances, Charley Hill was an average guy. He lived in an ordinary town with his wife, two children and a dog. He went to church and coached Little League. He was friendly but quiet, the sort of guy you could walk by on the street without noticing.

But appearances can be deceiving because Charley was one of the most successful car dealers in the Midwest. People traveled hundreds of miles to see him, even when there were plenty of dealers much closer to home.

What did Charley have that other dealers didn't? Not a thing. He sold the same cars as everyone else. Carried the same parts. Provided the same service. Yet his sales were typically two or three times more than other dealers of the same size. The reason?

Charley didn't believe in "fair" offers. He went out of his way to treat customers unfairly. I don't mean he cheated them. I mean he made offers that were so compelling and seemed so skewed in his customers' favor, people just couldn't say no.

What is a "fair" offer, anyway? A reasonable price? There's nothing wrong with that. But there's nothing exciting about it, either. An "unfair" offer, on the other hand, is very exciting. It's a deal that makes a customer feel he or she is receiving value that exceeds the price. It makes a purchase seem irresistible, easy and free of risk.

How do you make unfair offers? Here are a few ideas:

· Consider all the elements. An offer consists not only of the thing you're offering and the price but also the unit of sale (each? two for? set?), optional features (personalization? odd sizes? special colors?), presentation of price ($12 a month or 40 cents a day?), terms (credit cards? delayed billing? installments?), incentives (premiums? discounts? sweepstakes?), guarantee (money-back? buy-back? refund unused portion?), trial period (30 days? 60 days? 90 days?), time or quantity limit (respond before date? reply in 10 days? only 500 available?), shipping and handling (extra or included?), future obligations (buy three more in six months? no obligation?), etc.

· Make your offer clear. Confusion produces doubt, and doubt prevents response. Your offer must be easy to understand at a glance. Here's a test: Show your offer to someone who has never seen it. If that person can explain your offer after looking at it for 10 seconds, your offer is clear.

· Give away something. Free trial subscriptions, examinations, samples, books and catalogs, estimates, information, gifts, guides on how to use your product, etc. Caveat: Freebies lift response but can lower the quality of your customer. In some cases, you'll have more returns, bad debt and a customer base with no loyalty. Sometimes it's best to seek people who really want the product itself. However, freebies closely related to the product can help prevent this problem.

· Choose freebies over discounts. If you test a price discount against a free gift of the same value, the gift usually wins. Gifts almost always lift response, especially when the gift is a keeper - one that doesn't need to be returned even if the main product is returned or exchanged. Discounted pricing lowers the perceived value of your product. A freebie keeps your value intact and is more tangible than a discount.

· Increase perceived value. Offer value that "feels" greater than the price you're asking. If your product retails for $59, offer it for $39 - but show the original price. Stress that this is a 34 percent, or $20, savings. Throw in a free premium. Mention other benefits and privileges. Point out special features. Stress the exclusivity. Position your offer as a "charter" subscription, an "exclusive" membership or an "executive" option.

· Reduce perceived risk. There is an inherent risk in every purchase, especially when people can't touch, see or try it before they buy it. The more you can reduce the feeling of risk, the higher your response. Reduce perceived risk with free trials, guarantees, testimonials, return postage payment and whatever techniques make sense within your promotion.

· Reduce perceived commitment. A direct relationship exists between commitment and response. The higher the commitment, the lower the response. The lower the commitment, the higher the response. You must reduce the feeling of commitment to raise response. However, a direct relationship also exists between commitment and customer quality. The more commitment you ask for, the higher the quality of those who respond.

· Offer a choice of payment. Different people prefer different ways to pay: credit card, personal check, bill me, installments, purchase order, etc. If prospects want what you offer but can't pay for it the way they want, you lose sales.

· Make your price appealing. For lower-cost items, use price breaks to make a price more attractive: $9.95, $19.95, $29.95, etc. Breaks make a price seem lower while they cost you almost nothing. If you want a more prestigious image, though, use round figures: $120, $250, $370. Round figures say, "We don't have to worry about pennies." Also, to emphasize a low price, eliminate the zeros on a round price ($9). To emphasize the value, add zeros ($9.00).

Next time you create an offer, ask yourself, "What would Charley Hill do?" Charley wouldn't settle for just a fair offer. And neither should you.

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