Purchasing from a direct mail solicitation can be a bit of a gamble – or at least that’s the way it may appear to many potential buyers.
The problem is one of “perceived risk,” and it can make a promising sale simply disappear. But there’s something direct mail marketers can do to alleviate a prospect’s nerves and clinch the sale.
You can reduce or eliminate risk altogether by taking it on your own shoulders.
A Legendary Example
In his heyday, famous direct mail marketer Alan Shawn Feinstein sold collectible stamps and coins. One of the most famous stamps he sold was the “Face of Mars” stamp. This unusual stamp features a picture of what appears to be a human face on the planet Mars. In his sales pitch Feinstein claimed that the stamps would skyrocket in value when alien life was discovered on Mars.
Many thousands of people went ahead and bought the stamps. Undoubtedly, part of the reason why people were willing to go ahead and make the purchase is that the marketer made the sale “risk free” to the buyer. How did he do this?
Feinstein made an amazing guarantee. The guarantee was that the seller would buy back – at any time – the stamp for the original purchase price. That way, the seller was taking all the risk, not the buyer.
The perceived risk – that the stamps would not go up in value – was eliminated. And the benefit to the seller? He made a ton of sales, with profits that more than outweighed the few refunds he had to make.
A Local Example
Where I live, in Oregon, the largest local tire dealer makes a similar risk-free offer. There are many places in Oregon where a person might drive in the winter and need snow chains, but there are some areas that only experience snow occasionally. Most people would like to have chains in the event they need them, but they don’t want to buy snow chains if they aren’t going to use them.
So, this local tire dealer makes this special offer each winter: Buy the chains for your car, put them in your trunk, and if you end up not using them, just bring them back when winter is over, and you’ll receive 100% of your money back. So, it is risk-free for the buyer.
I’m sure you can guess that most people don’t bother to make the effort to return the chains, and the tire dealer sells a lot of chains this way.
How can YOU eliminate “perceived risk”?
One way, of course, is to offer a guarantee. Most buyers expect a guarantee of some time period on any major purchase. A guarantee period of 30, 60, or 90 days is common. But – if you extend your guarantee even longer, you’ll usually find that the longer the guarantee, the better it works.
The examples used above go even further than guarantees by using “Risk Reversal”. What can you do to reverse the risk, so that you take on the risk and the customer now feels risk-free in buying your product?
If you are a business coach, perhaps you could offer a money back guarantee. The client would receive a full refund IF you were not able to help grow their business. In essence, they’d be paying you out of the profits. If your sales material made that point clear, it would totally eliminate the risk from their point of view.
If you sell a diet system or supplement, perhaps you could let people begin participating in the weight loss program at no cost, and they only pay you after they’ve lost 10 pounds.
If you prepare taxes, you could agree to review the customer’s last year’s return at no charge, and get paid only if you find something that will save them money.
Of course, with offers like this, you have to be careful to only deal with people who are serious. And this is one of the great advantages of Direct Mail … we can be very targeted in making our offers to only the most qualified prospects.
If you can eliminate your prospects’ perceived risk. Your sales will probably skyrocket so much that the risk you are taking instead will be minimal.