Tag Archives: credibility
I am deep into a study of game theory and finding many key applications to business. Here's something you might not have ever considered yet is absolutely crucial to your business. If you make a promise and there is no pain to you, the promise is hollow and your customer or prospect knows it.
Pain to you? Aren't all of our transactions supposed to be win-win? Maybe not.
Have you ever had the horrific experience of buying a car from a dealer? Was win-win your goal or did you want to avoid being skinned? Did you care if the dealer won anything? Most importantly, did you trust anything the dealer promised you?
When we make a promise, there needs to be pain on the part of the promise maker for the promise to have validity. Think deeply about this.
Consider the restaurant that claims to offer a "world famous steak". Hard to believe. And if it isn't? So what.
What about your business claims? Do you claim to offer a "money-back" guarantee? Do you promise "the best" service?
Step back and consider these claims as a consumer. Let's consider the "money back" guarantee. That means you pay me first. You take the risk. Later, if you are not happy, what assurance, other than my word, do you have of getting a refund? I may be the most ethical person on earth. I know I will give you a refund if you are not happy. Of course, I've never had to refund a customer because I've never had an unhappy transaction. So, I'm not really worried about offering a refund and besides, you have to pay first.
Wait a minute. Isn't this a somewhat lop-sided guarantee? I get the money, you get my assurance. If we don't know each other, what have you really got?
A promise without pain on the part of the one making the promise means nothing. Just because you haven't considered this doesn't mean your prospects haven't! Fact is, you have considered this—every time you are on the other side of a promise.
So how can we add a little pain to the promise for me in order to make the promise real for you? Rather than a money-back guarantee, how about you pay only if you are satisfied?
Would you adopt that policy at your business?
Scary? Why? Isn't that the same thing as a money-back guarantee? Of course it is isn't and you feel it in your gut as soon as I suggest it. And that makes my point. The hesitation you feel when I suggest going to a post-delivery payment scheme is the same hesitation your prospect feels when you present the money-back guarantee. It is scary.
Perhaps post-delivery payment is too risky in your business. There are some dishonest people out there. But you can introduce some pain to your side of the deal without exposing your business to ruin. (Start by actually being the best) You could accept a deposit of 25% with the balance due upon satisfaction. I said 25%. You must resist the urge to cover all of your costs or we are back where we started.
I'm re-working all of my promises and guarantees. Take a look at yours. Are they credible? If you fail to deliver what you promise, are you hurt? If not, why should I believe you?
Chris Reich, TeachU.com
(By the way, you are free to use these posts freely. I ask that you credit the source as "TeachU.com")