Many marketers have heard of the power of providing customers and prospects with an irresistible offer or mafia offer. In other words, this means making an offer to your prospects or customers that is so irresistible that they simply can’t say no to. When properly utilized an irresistible offer will bring in more customers to your business. However, when done wrong, it can destroy your customer base.
The key to designing a powerful and effective offer is to really understand the lifetime value of your customers. Sometimes, business owners only focus on what they can earn today from their customer base. This short term approach has the potential of damaging the trust and loyalty of these customers eventually eroding the business.
Many research studies have clearly demonstrated how it is a lot easier to have an existing customer buy from you than to try and find a new customer. So, when developing an offer to our customer base it makes sense to provide them with great value that will then build their trust and loyalty.
It is not about your business
Some businesses misunderstand the fact the customer always determines value, and instead they try to convince the customer what the value is.
I once heard comedian Ron White joke about what value really is. He tells the story of a salesman who tried to justify the price of designer sunglasses selling for $350.00 as being a tremendous value. White countered he didn’t get it because for $250 he could by a 27″ T.V. at Wal-Mart. The salesman just told white, “you just don’t get it”.
The point is that despite what a business may sincerely believe is valuable, it is not going to motivate a buyer unless they perceive the offer as valuable.
This may appear to be common sense. However, even large fortune 50 companies can make the same mistakes.
Customers are not fooled
Recently, I saw a marketing piece that was sent out by the manufacturer of an American made luxury car. The concept behind the promotional piece was to encourage owners of this brand to visit their local dealer for routine maintenance. In order to entice the owners, the manufacture had offered a “great deal for being a loyal customer”. The deal was a $99 brake special.
Now, typically brake work for these types of vehicles run between $450 on the low end, and $500 on the high end, per axle. . So, the $99 special was indeed an attention grabber- an irresistible offer.
Remember that the promotional letter said, “This special offer is being made for being a loyal customer”.
When the customer called into the dealership the service adviser explained that the “$99 brake special” was very limited. It only covered taking off the tires, and installing an inferior brand of brake pads. All the other standard procedures were not done, such as adjustments, fluid and mechanical checks, and adjustments to the parking break. The service adviser then stated that if the customer wanted those services to be performed they should choose the standard priced brake job.
This type of offer just irritates customers. Customers are not dumb and they can immediately see the bait and switch being presented.
Sure, this promotion did get the phones to ring, and it is logical that some customers did book an appointment.
However, there were many who were simply upset. To them, this marketing offered only diluted the trust and brand loyalty they once had for the brand. This only makes common sense. A customer calls in thinking they have been given a valuable discount only to find out that they were just going to be up sold to the regular price. Then, if they did accept the offer they would be left with a lessor quality brake system on their “luxury” vehicle.
The manufacturer would have been better off never making any offer rather than insulting the intelligence of their customers.
The take away is simple. If a business does make an offer to its best customers, it should make sure that it is truly something that will be valued by the customer. Today, businesses don’t have to read minds to understand what is valuable and what is not. A simple survey can answer all the questions.
Any business that has a loyal customer base has at its disposal valuable information just waiting to be mined. The fact is loyal customers are usually enthusiastic to answer questions about what they like and don’t like.
One excellent way to survey your existing customers is by using Survey Monkey. They have both paid and free surveys that anyone can send to their customer base.
Using this system a business can ask their customers what offers they prefer, or compare different offers before mailing them out. In the end, the business will experience not only a higher conversion, they will have increased the long term value of their customers.
At Bay Area Mastermind our members have the opportunity to discuss their irresistible offers and other business issues before a small group of like-minded business owners. While always maintaining confidentiality, these discussions serve as an excellent sounding board for ideas. Try a mastermind Test Drive today.