Message
#178
Friday,
September 22, 2000
"I can’t get no satisfaction/
Mick Jagger
and Keith Richards
Today, I’d like to talk
about my first big marketing discovery. It instantly changed the way I thought
about selling and allowed me to become a much better businessman.
There
are four men in a room. One has on a nice pair of Gucci loafers. The second has
on sandals. The other two are wearing sneakers, but one pair is old and the
other brand new. Your job is to sell one of them a nice new pair of Nike
sneakers. You have only five minutes to make the sale or your dog will be shot.
Which man do you sell first?
If
you answered "the guy with the new pair of sneakers,"you understand one of the
most important secrets of making money in a consumer market. Today’s message is
about that - what it is, how it works, and how to take advantage of it in your business.
A Few Embarrassing Examples
From My Own Life
About
five years ago, as a birthday surprise for KF, I traded in one of the two cars
we owned for her favorite SUV: a Toyota Landcruiser. Driving home from the
Toyota dealership, feeling good about what I had just done, I found myself
magnetically drawn into another car lot where, lo and behold, KF’s other
favorite vehicle stood. This one - a
bright red Saab convertible - was parked next to the Landcruiser when KF
returned from her daily whatever. What had gotten into me?
Another
example: Three years ago, I bought EP a Dupont (read "expensive") cigar lighter
as a thank-you for getting me into a real-estate deal. About a week later, I
was in my favorite cigar store stocking up on robustos when it dawned on me that
I could never again be satisfied with a $1.29 Bic. I felt that magnetic pull
again - this time to the Dupont lighter display case. A limited-edition beauty
was in my pocket before I walked out the door. And in the weeks that followed, several
more found their way into my study. Today, I have almost as many classy cigar
lighters as I have cigars - and none of them works as well as my humble Bic.
You
get the point.
Most
of the time, most people buy products and services in intermittent,
near-compulsive surges. One is never enough. And I’m not talking only about
potato chips. This applies equally to . . .
*
clothes
*
jewelry
*
stereo stuff
*
computer stuff
*
fitness equipment
*
gadgets and gizmos
*
self-improvement publications
*
financial and other advice
*
wines, gourmet foods, etc.
Not
to mention cars and cigar lighters.
Is anything
exempt? I just spent five minutes trying to think of something. Not toilet
paper. Not diapers. Not plastic surgery.
It’s
very important to understand The Buying Frenzy, because it allows you - as a
marketer and/or entrepreneur - to take advantage of your easiest and most
profitable sales. If you make the common-sense mistake of thinking that one
eighty-five-foot schooner is enough for one man, you are making a very serious
mistake.
Let’s
consider a worst case scenario. You are back in the sneaker business. A fat man’s
wife has just coerced him into buying a pair of running shoes, hoping he will
get the exercise he needs. He has been whining through the entire process, but
has finally relented. Should you leave him alone?
Absolutely
not. Ask him if he would like a discount - and when he says "yes," offer him a
second pair for 20% off. Remind him that with two pairs, it will be twice as long
before he’ll have to come back again. Statistically speaking, he’s got a better
chance of saying "yes" than the guy with a hole in his sneakers who is walking
by.
Secret:
When people buy something, the buying itself does not satisfy the urge. It
excites it.
A
telling example of The Buying Frenzy in action happened to me, by accident,
somewhat early in my direct-mail career. We had just done a successful promotion
selling $48 black-and-white TVs. We "rolled out" to a wider audience, hoping to
repeat our good fortune. This test worked well, too, but one segment of it (one
particular mailing list) had twice the response rate of the rest. When I asked
what it was, the marketing manager sheepishly admitted she had made a big
mistake. She had accidentally inserted the file of buyers into the mailing
file. The people who bought TVs at twice the rate of their peers were those who
had - just two weeks before - bought identical TVs from us!
Never Underestimate The Need
To Buy More Of What Was Just Sold.
If
we had time today to talk about the psychological process of buying - what
people are really doing when they buy things - I think I could give you a
pretty good explanation of why this happens. (If you’re an American Writer’s
& Artist’s Institute (AWAI) student, refer to your lessons on benefits and
"deeper benefits.") Suffice it to say, the chromed-out Harley Fat Boy we can’t
wait to buy promises much more than a very dangerous and uncomfortable way to
go from point A to point B.
Some
Buying Frenzies last longer than others. Some are more intense. Generally the
shorter the duration, the more buying there is. It is as if there were some
absolute but unknown (even to the buyer) number of purchases that have to be
made. The less time available, the more frequent these purchases need to be.
Hobby-related
Buying Frenzies (model airplanes, martial arts, etc.) are usually very intense
but they often last for a relatively short period of time (because most people
don’t pursue hobbies for very long). Health-related Buying Frenzies are the
same. Self-improvement Buying Frenzies can last for years, as can frenzies for
wealth building and spiritual enlightenment.
Obviously,
you must know your market to understand the pattern of your customers’ frenzy. But
the most important thing to know is that Buying Frenzies end only if one of two
things happens: (a) your customer runs out of money or credit, or (b) you stop
selling.
Always
remember this:
* Your
Buying Frenzy customer will not be satisfied with the first purchase. He will
need to buy more - to get the same emotional charge. If you don’t satisfy that
desire, your competitor will.
* The
length and duration of frenzy purchases are determined by factors you can and
should understand. Pay attention to them and you will be able to create a
follow-up selling campaign that will give your customer everything he wants and
make your bottom line fatter.
* *
* * *
One
way to get money for your new venture is to pitch your good idea, as a sales
presentation, to a prime customer. If he goes for it, tell him you will start
supplying him as soon as you get money to start your business.
That’s
basically what Scott Mitchell did to launch Learning Productions in Tempe,
Arizona, according to a recent issue of Newsweek. Mitchell pitched his learning
software to Avnet, a Fortune 500 company that had a need for the kind of
product Mitchell wanted to produce.
They liked his presentation so well, they not only gave him a big order,
but more than a million dollars worth of financial and other support needed to
get the company up and running. You can’t to this with every new business . . .
but I spent a few minutes thinking about it and was surprised by how many types
of businesses I could come up with that could be started this way.
*
How to speed up the learning process and achieve perfection
*
Business Idea: Auto purchase consulting