The Magic of “Reciprocity”
Issue #2019
- WEALTHY: How to turn a 2.6% move into a 142% gain (Rick Pendergraft)
- HEALTHY: Healthy fast-food options? (Suzanne Richardson)
- WISE: Confucius on reciprocity
ALSO IN THIS ISSUE:
- Get immediate attention with a single dollar bill (Bob Bly)
- Memo to self: Must send memo (Michael Masterson)
- It’s Good to Know… about productivity in the workplace
- Add "bacronym" to your vocabulary
Revealed: Probably The Biggest Red Herring in History!
While the World’s Been Stock Watching (and losing!),
The Elite Quietly Play a Different Game with Different Rules…
Feeling cheated and disillusioned by the stock market? Sure, you may have made a good trade here… but then lost on another. The people dutifully pour their hard-earned cash into investment banks to put into the stock market for them… and those investment banks gladly oblige, for a fat fee… which they invest somewhere else! I’m no conspiracy theorist, but in my opinion the stock market is really a diversion for the masses… a distraction from where the BIG and consistent money is made… in the world’s money mountain. And when I say “Money Mountain”, I speak quite literally… the BIGGEST mountain of money on the planet. Click here to read more…
How to Take Advantage of a Volatile Market
By Rick Pendergraft
With the recent mini-correction in the market, volatility is back with a vengeance. And if you’re an options trader, that volatility can be your friend instead of your enemy.
When quick moves happen in the marketplace, the leverage that options provide can cause a three or four percent move in an index to become a triple-digit gain. A recent trade in my ETF Options Trader service is a good example.
Back on November 28, my subscribers received instructions to purchase calls on the Spyders (the ETF that tracks the S&P 500). Sixteen days later, they received instructions to close the last portion of their position.
Over the 16-day period that we were in these calls, the Spyders went from $138.85 to $142.50. In case you don’t have a calculator handy, that’s a gain of 2.6 percent. But, because of the leverage that options provide, even though the Spyders only moved 2.6 percent our calls gained 142 percent.
Another advantage of options is the smaller cash outlay they require. In the above example, if we had chosen to purchase 100 shares of the ETF, we would have had to pay $13,885. The calls we bought were only $195… to control the rights to the same 100 shares.
Had the market moved against us, the most we could have lost on the calls was $195. Had we purchased the Spyders and they moved down 2.6 percent instead of up, we would have been down $361.
So by purchasing calls, we used the leverage of options to capture a triple-digit gain on a small move. Plus, we had less money exposed to the market.
[Ed. Note: Find out how Rick Pendergraft can help you make money - no matter what the market’s doing - as the editor of ETR’s investment service, the ETF Options Trader.
"There is one word which may serve as a rule of practice for all one’s life - reciprocity."
Confucius
The Magic of "Reciprocity"
By Bob Bly
Recently, Google AdWords expert Perry Marshall sent me a letter. Enclosed with the letter was a crisp, new $50 bill.
That certainly got my attention. Wouldn’t it get yours?
But it did something in addition to getting my attention. It made me feel obligated to read Perry’s letter - and to comply with whatever he was going to ask of me.
The letter began: "The most important thing you need to know about this $50 bill is there are more where this came from - a lot more."
His offer: Promote a free Perry Marshall teleseminar to my subscriber list - and get a nice affiliate commission from back-end sales of his coaching services to them.
Perry sent the same letter to 23 people with lists that he thought would work for his offer. With a $50 bill in each letter, he gave away $1,150 in cash.
Did it work?
Yes. Perry reports that eight or nine of the 23 recipients promoted his teleseminars to their subscribers.
A few recipients who had to decline Perry’s offer for one reason or another sent back the $50 via PayPal. If I had not accepted it, I probably would have done the same. But when you’re holding cash in your hand, it’s hard to give it up.
I likely would have done the deal even if the $50 bill hadn’t been enclosed, because Perry is a friend and admired colleague. However, it made me give his request my immediate attention instead of putting it aside for consideration when I had more time. So in my case, enclosing the money certainly helped Perry get my commitment to his promotion in a timely manner.
The bottom line? Perry added 4,000 new subscribers to his e-list… and closed coaching contracts worth around $100,000. All those new coaching sales were to his affiliates’ subscribers - buyers who were NOT on Perry’s list.
Why am I telling you about this?
Because it demonstrates a principle that Robert Cialdini talks about in his book Influence: The Psychology of Persuasion. That principle is "reciprocity"… and it’s something Michael Masterson has written and lectured about.
Reciprocity means you give something away to your prospects - and, by doing so, you create in them a need to reciprocate in some way. As a result, they feel obligated to - if not buy what you are selling - at least consider your proposition.
It’s an old - and proven - idea.
Market research companies used to mail consumer surveys with a dollar attached. Those companies knew the dollar wasn’t really important to the recipient. The cover letter usually stated: "I know this dollar is not important to you. But it may brighten the day of a child you know."
By keeping the dollar bill, recipients felt obliged to reciprocate by answering the survey. It boosted response rates… because many felt it would be wrong to take the dollar without filling out the questionnaire.
But you don’t have to give away a dollar - or even $1,150, like Perry Marshall did - to use reciprocity as a marketing tool. Anything of value that you do for - or give to - your prospects or customers can create a sense of obligation… and increase your sales.
For instance, you could give away a free white paper… a free CD… a free book… a free calculator… a tele-class… a coaching session.
If the recipients find your gift valuable and useful, that doesn’t guarantee a sale. But it does increase the chances that they will listen to your sales pitch… read your copy… or accept a free trial of your product or service.
[Ed. Note: Bob Bly is a popular Early to Rise columnist, self-made multi-millionaire, and the author of more than 60 books. He is also the editor of ETR’s Direct Marketing Masters Edition - a program to help you start your own successful direct-mail business.]
A Conservative Strategy for Generating Aggressive Returns
The most successful hedge funds and institutions often beat the market by allocating a large percentage of capital to long-term investments… while using a smaller amount of capital to make timely, leveraged bets on rising and falling market sectors.
And with the evolution of ETFs it is easier than you might think for YOU to do the same thing. Click here to learn how you can regularly see returns of 30%… 50%… 100%… allowing you to multiply your wealth, while actually reducing your overall risk in the market.
What Do You Do After a Meeting?
By Michael Masterson
After you’ve attended a meeting - whether it’s with your employees or some of your business colleagues - what do you do?
I write a memo summarizing the main points, the action items, and the details. And if I don’t do it myself, I ask someone else to do it. This is a necessary step, I’ve found, to get everything that was talked about accomplished.
Alfred Sloan, the former president of General Motors, did the same thing after his meetings. It’s one of the reasons business guru Peter Drucker considered him one of "the most effective businesspeople" he knew.
Keep in mind that sending a memo to the appropriate people is not enough to get things done. So I file the memos I send in my calendar file, under the earliest deadline. And when that day arrives (or sometimes a few days earlier), I send out a "how’s it going?" memo to the responsible parties.
Knowing that you have a good handle on everyone’s commitments is a great incentive for them to achieve your objectives on time. So try this after your next meeting.
Reader Feedback: "You have motivated me to keep trying."
"I want to let you know how much I enjoy your newsletter, because you keep me well informed on what’s going on in the marketplace. I am currently trying to create a business, and my biggest difficulty is in how to sell.
"I have never really taken the time to write to anyone, but your work calls for it. You have motivated me to keep trying and keep pursuing what I want.
"Thanks for the health advice and the vocab. These are truly great.
"Many blessings to you and your staff and to all those wonderful people that contribute."
- Valerie Villalobos
Mayaguez, Puerto Rico
Unscrew Your Life: How to Keep It Healthy When You’re on the Road
By Suzanne Richardson
When you are able to cook your own food, you have complete control over your diet. You can choose to avoid processed foods, eat lean proteins and healthy fats, and fill your plate with veggies.
Unfortunately, preparing a healthy, balanced meal for yourself isn’t always possible - especially when you’re traveling.
So when you just got out of a 10-hour meeting and you’re sitting back in your hotel room in Des Moines, Iowa, you and your diet are about to get screwed, right?
Not so fast…
Charlie Byrne, ETR’s Editorial Director, wrote me about the Healthy Dining Finder, a searchable website full of information about menu items in restaurants all over the country.
When you type in your current location, you may be surprised to find that even fast-food restaurants like Burger King and Arby’s pop up in the search results. You can ignore them (they are paid sponsors) and browse through the other options. Many of those menus may be just marginally better than junk food, but at least you have some basis for making an informed decision.
Here are a few examples:
- Two slices of Domino’s thin crust pizza with cheese, sauce, onions, green peppers, mushrooms, and black olives has 19 grams of fat, 280 calories, 570 mg of sodium, and 10 grams of protein.
- The Macaroni Grill’s Pollo Magro ("skinny chicken") has 5 grams of fat, 310 calories, 770 mg of sodium, and 42 grams of protein.
- The chicken fajitas at Chevy’s Fresh Mex have 12 grams of fat, 390 calories, 770 mg of sodium, and 54 grams of protein.
- The steak salad with cranberries and mandarin oranges at Au Bon Pain has 7 grams of fat, 290 calories, 400 mg of sodium, and 20 grams of protein.
The Healthy Dining Finder site also lists how many cups of veggies and fruits each meal has, plus the amount of carbs, sugar, cholesterol, and fiber in each item.
[Ed. Note: Learn the keys to handling difficult situations involving your health, your business, and your family. Just pick up your free copy of ETR’s Unscrew Yourself e-book and get 223 pages of our most practical insider information.]
It’s Good to Know: About Productivity in the Workplace
The average U.S. employee:
- works about 45 hours a week
- considers about 16 of those hours to be unproductive
- spends 5.5 hours in meetings each week
- receives 56 e-mails each day
(Source: 2005 Microsoft Office Personal Productivity Challenge Survey)
Turn YOUR Brain into an Idea-Generating Cash Machine
Want to know the same secrets that McDonald’s Ray Kroc, Microsoft’s Bill Gates, and Amazon.com’s Jeff Bezos use every day to keep their businesses at the top of their game?
It’s the most valuable money-making secret on the planet and the easiest to convert to cold, hard cash…
Take advantage of this unique method, made easy by a million-dollar idea superstar today!
Word to the Wise: Bacronym
You know what an "acronym" (AK-ruh-nim) is - a word formed from the initials of several other words. For example, scuba for "Self-Contained Underwater Breathing Apparatus," asap for "As Soon As Possible," and ram for "Random Access Memory."
Well, a "bacronym" (BAK-ruh-nim) is formed when the letters of an existing word are expanded into separate words, sometimes with humorous intent. For example, a bacronym for Adidas (which was originally formed by combining the first and last names of founder Adolf "Adi" Dassler) is "All Day I Dream About Sports," and a bacronym for golf is "Gentlemen Only, Ladies Forbidden."
[Ed. Note: Become a more persuasive writer and speaker … build your self-confidence and intellect … increase your attractiveness to others … just by spending 10 VERY enjoyable minutes a day with ETR’s new Words to the Wise CD Library.]
Michael Masterson
Copyright ETR, LLC, 2007