In the movie “Tin Men,” starring Richard Dreyfuss and Danny DeVito, an aluminum-siding salesman goes into a car dealership to buy a new Cadillac. “How much is it?” he asks the car salesman about the car he wants to buy. “How much do you want to pay?” the car salesman asks back. Disgusted by what is an obvious sales tactic, he replies sarcastically, “A dollar . . . I want to pay a dollar.”
The technique of asking a prospect how much he wants to pay is almost de rigueur if you’re selling something like a car or house, where the numbers can be manipulated to accommodate a range of budgets. But in direct mail, we’re not in a “let’s make a deal” kind of business. It’s usually not possible for us to ask our prospect what he is willing to pay for the product or service we’re selling. That puts us in the same position as a car salesman or real-estate agent whose prospect either doesn’t know or refuses to reveal how much he can afford.
In a case like that, a good salesperson might use the “good, better, best” method of price quotation. Let’s use the example of a real-estate agent who is trying to sell a prospect a custom-built home on a half-acre lot. Instead of just quoting the price of his top-end home, which is $500,000, he would give the prospect three options to choose from. The first option, which he calls “good,” is a basic three-bedroom home with a fireplace and an unfinished basement.
It is priced at $300,000 — the cheapest price he can offer while still giving the buyer a decent home and himself a decent profit. The second option, which he calls “better,” is the same home but with a finished basement and an added sitting room in the master-bedroom suite. It is priced at $400,000 — as his middle-of-the-road model. The third option, which he calls “best,” is the same home as in the “better” option but with deluxe landscaping, a second fireplace, and a fourth bedroom. It is priced at $500,000 — as his top-of-the-line model. He outlines all three options for his prospect, including the prices.
Then, instead of asking IF he wants one of them, he asks, “WHICH one do you want — good, better, or best?” This strategy works for two reasons. First, it increases the chances that his price quotation will fall within the dollar amount his prospect will pay. Second, very few people want the lowest quality of three choices. So some buyers who were looking to pay $300,000 will find a way to pay $400,000 (even if it means a bigger mortgage or borrowing from Uncle Joe) — and more will select “better” over “good.”
(Ed. Note: Bob Bly is the editor of Mailbox Millionaire, ETR’s program to help you start your own successful direct-mail business. For information, click on http://www.agora-inc.com/reports/700SCBMO/W700DC03.)