Product Offers stimulate market activity by creating an incentive to buy your product. The offer is the terms under which a specific product or service is promoted. It answers the customer's question: "What's in it for me?" There are many marketing uses for Product Offers. They are essential and are to be considered a Core Process.
Product Offers are essential. Remember that revenue is the result of solving a problem for a customer for a price. At its root, revenue is about activity. You need to have the market interact with your company and product. Anything we can do to stimulate activity is a benefit. This is where the Product Offer becomes an essential component of your Revenue Chain™.
An offer is an incentive to do business with you. You are communicating a message of the incentive to the market in the form of a marketing offer. The offer is stated in many different ways:
• “Buy today and get the second item free!”
• “Call us today and receive your free gift!”
• “Act now and you’ll get 90 days added to your membership!”
Marketing offers are based on a stimulus – response format. The offer is the stimulus and the response of the prospect is the response. The goal is to condition the market to respond to your offers.
There is one fundamental reason every business should learn and use product offers. It is a known fact that a person will generally take the longest amount of time possible to complete a task. Specifically stated, Parkinson’s Law says, “Work expands so as to fill the time available for its completion.”
If we define purchasing your product as a task, we can assume a prospect will generally take the longest time possible to purchase your product. Of course, this depends on your type of product but, generally, it’s true. If you don’t put an incentive in front of a prospect and give that incentive a boundary, you won’t get the number of customers you need to survive.
To stimulate market activity, create product offers that have a stated participation guideline with a clear beginning and an end. This will help to move people through the stages of change and reduce contemplation.
The Mechanics of an Offer
The offer is the terms under which a specific product or service is promoted. It answers the customer's question: "What's in it for me?" The offer is stated clearly and simply. Here is a list of some of the offer types:
1. Contests. Everybody loves contests. People enter to win with the hopes of winning the grand prize.
2. Deluxe Edition. This is offering an enhanced version of your product or service
3. Early Bird Offers. You can offer a discount for paying early. Or if they pay by a certain date they receive a bonus. The offer is time sensitive.
4. Free Trials. Free trials give people a period of time to try out your product or service before making a buying decision.
5. Guarantee. You are giving a money back guarantee or a warranty for a period of time.
6. Payment Options. Installment payment options are always attractive to your customers, especially on high-ticket items.
7. Premiums. These are gifts you can give as an incentive to purchase a certain product or service.
8. Price Incentives. You may offer a discounted price or a percentage off. The price incentive motivates the lead to take action.
9. Samples. Samples are give-always of your product or service.
The type of offer you use depends on many factors. Learn how to use product offers effectively by selecting, testing and measuring different offer types.
Direct Response Offer
A Direct Response Offer provides a clear course of action for a prospect to follow and generally has the best response rates for offers. There are four parts to a direct response offer:
1. Specific Offer
The specific offer is called the Incentive Statement. The Incentive Statement is crafted in such a way as to create an incentive the reader can relate to.
2. Response Time
A direct response offer has a limited response time that boxes the opportunity and creates a “use it or lose it” situation. Response times vary from a week to several months. A common way is to simply state an expiry date for the offer.
3. Call to Action
A Call To Action tells the reader how to take advantage of the offer. Here is a simple list of
actions to give you a taste.
• Act now!
• Send your name
• Rush name for details
• Get started today!
• Ask for free folder
• Get your copy now!
• Send for free details
• Send for it today
• Send post card today
• Send today
4. Risk Reduction
A Guarantee reduces the risk of responding. Guarantee the reader with a statement that will reduce the risk of taking action. Satisfaction Guaranteed! Whatever your offer, a guarantee is essential. Contrary to what some entrepreneurial types think, offering a guarantee in no way diminishes or denigrates your product. The guarantee has nothing to do with the product. Rather it speaks to you and your company and the honest, fair and open manner in which you do business. It's designed to build trust and mitigate risk.
The Quantity/Quality Ratio
Offers are designed to stimulate the market. You are going to encounter the Quantity / Quality Ratio of offer marketing. The higher the quantity of response to an offer, the lower the quality or interest level of the respondents.
For example, you can give away a very valuable product for free and give it away to anyone who wants it. But you will find the interest level in the actual purchase of a product is quite low. In contrast, you can create an offer that has stringent qualifying requirements and will nearly guarantee a purchase but the volume of respondents will be very low. The goal is to create offers and methods of communicating offers that create a meaningful ratio of quantity to quality. You can’t have it both ways.
Managing Your Offers
The management of product offers is something you learn over time. There is no silver bullet. The market you are targeting is dynamic and always in transition. What works today may not work tomorrow. That’s the way it is and you have to adjust. The market will not adjust to you.
Test your marketing. What works for one market may not work for another. The beauty of marketing offers is that you can test them. You can spend a small amount of time and money to test offers and then spend big on what works.
Here are some general management guidelines for you to follow:
1. Don’t go without a product offer.
Get into the habit of creating and managing your product offers. As a rule of thumb you should never go without a product offer – ever. You immediately take away the closing tools your sales people need to close deals. You open up the limitless boundary of the contemplator and your market cultivation will dwindle.
2. Limit your number of product offers.
If you have too many product offers in the market you only confuse the market. I generally recommend no more than four offers be worked at any given time. There is a number that will work for you and you will learn it over time. Some companies market one offer very hard and others put out multiple offers.
3. Create a set life span for offers.
Offers need to have a life span. It depends on the goal of the offer. If you are appointment setting and you have an offer to get an appointment you want a very short life span on the offer. If you are marketing a product offer and your product has a long selling cycle then you want a longer life span on the offer. Thirty to ninety days is generally the rule of thumb for a product offer.
4. Cycle Your Intensity
Start each month fresh and with a renewed energy. Market to prequalified prospects and lighten up on the closing intensity. This should last for the first ten days of the month. In the middle of the month you start to position more deals and work towards the close. The last ten days of the month are for closing sales. This is a very intense period and focus is mandatory. Cycle your intensity because it’s very difficult to maintain an intense closing atmosphere for very long.
5. Train the Staff
Don’t assume that just because you have a marketing offer that people know how to use the offer. Train your staff to offer the way you want them to. Assume someone doesn’t know how or when to use a marketing offer. Train them accordingly.
Creating and using Product Offers is an art and a science. It’s your best friend if it works or your worst enemy if it doesn’t. It requires you to focus. Most importantly you need to learn what works for you. Timing is everything. Each industry has a timing pattern that you can trigger with product offers. Learn the offer and when to offer it and you succeed every time.