Give to Get by Lawry J. Hobart

The idea of effective integration of marketing into business, rather than marketing being considered a separate layer, is an old man by now, but his gray hair, generous eyes and shrewd knowledge of timing, are still overlooked,  to the peril of the entity overlooking said old man.

Businesses, of course, have to take care of their marketing, but their marketing must also take care of the business from every possible angle.

Today I want to explore the idea of giving stuff away for "free" to the customer, to acquire or retain a customer, and avoid operational disasters, and in some cases, HUGE financial losses, because you didn't give away a tiny bit of free shit.

It's about ACCURACY and SPECIFIC ATTENTION TO MATHEMATICAL DETAIL.

And "giving away free shit" for customer retention, so long as it is meticulously measured, can be an amazingly effective tactic, in terms of client retention AND acquisition.

This is rudimentary stuff - we all know it - here are some ways to exploit this principle in a bit more depth.

Example 1 - Retaining clients as they are walking out the door

2 business partners.

Business partner 1, John.

Business partner 2, Mick.

Business " Yell"- Telemarketing, specifically  sales appointment setting, in one focused industry, with the means to service multiple clients usually at a very high standard.

"Yell" are customer-centric, operating most effectively on the basis of mass repeat business.

A mid size, repeat account has just threatened to depart ways, because they felt the quality of the sales appointments being set had dropped from when the partnership first started , 6 months back.

The client was considering going from "Yell" to another supplier and voiced that to John. He had also sent an email politely declining their  services.

John calls the client and offers him 5 free replacement appointments, in the knowledge that this will take 5 - 10 hours of telesales  time and approximately cost the business less than $200.00.

John knows that by offering him free appointments, he is unlikely to pay the other supplier until trying those appointments first.

He also understood a very high likelihood of retention, given the team had at the beginning, given good results on reasonable terms.

John handles, and acquired,  the account, and has liaised on great terms with the customer since the time of acquisition.

He is on the board as a Director and Mick is a Managing Director.

John calls Mick and informs him of his decision.

Directly against Johns advice, Mick immediately calls the client and advises him that we would, instead of John's suggestion,  offer a much higher level of service, in return for a small payment.

When Mick's  (Mick is the MD John is the Director) new ideas are implemented, the cost of acquisition for an appointment becomes  up to 1 - 4 x the amount the client is paying.

Now, the business has to expend resources putting the fire out, OR spend a fortune AND loads OF HIS TIME trying to retain a client that will still probably be unprofitable and therefore a liability.

Example 2 - Give where your competitors won't.

Fred and Pete both sell cherries, about 100 meters away, out of sight from each other, at an intersection.

Fred sends a friend to Pete to see if Pete will give away free cherries.

Fred knows he has more cherries than he can sell before going bad, so he sets up a promotion for 1 day: 21 Free Cherries to everyone for 4 hours, during the rush hour.

For the next few months, these remain his loyal clients, often buying cherries for a chat as much as the cherries, and Pete is forced to move to another site, giving Fred the entire market share.

Fred's income TRIPLES for a lifetime from to 120,000. Why doesn't it double, you ask? Because Fred's generosity will always be remembered, meaning the entire pie gets bigger, and it gave him the upper hand because of the simple, ingrained, impossible to deny for most people, nature of reciprocity.

The cost was 2,100 cherries, or about $150.00, to triple his income, for life.

Example 3 - Straight up reciprocity (from source 1)

Depending on your age, you may remember the days when you’d pass a group of Hare Krishna at a street corner and get a worn-out daisy shoved into your hand.

You try to avoid it. You try to say no.

But despite your protests, they swiftly force that tired daisy in your hand saying it’s a gift of love.

In your head, you shout, “I don’t want this “gift!” Because you know once that daisy hits your hand, something in your brain snaps. Without warning, BAM! The dynamics dramatically change.

Now you owe them something.

As that faded daisy lies begrudgingly in your hand, you automatically feel you need to reciprocate. Even though every cell in your body screams, “Take your daisy and run!”

While you stand there paralyzed by moral flux, the Hare Krishna gently asks you for a donation.

Before you know it, you empty the change jingling in your pocket or pull out a buck. Then you hurry away, immediately tossing that daisy into the nearest garbage can.

So what happened?

You just experienced a powerful marketing tool called The Principal of Reciprocity. It’s one of the many principals explained in Robert Cialdini’s brilliant book, Influence.

Business decisions are rife with false economies.

Give nothing away truly for 'free' but by all means, give free things away.

One customer retained saves X in your sales persons wages, and his support, and your valuable time.

Giving away "free" shit is rife in big and growing business.

Handouts of samples, sales people spending hours with accounts that never eventuate, these things are effectively expending money (be it through manpower, product, etc) and are part of the game.

So many business people refuse to give things away, only to pay 10 x the cost for them in other ways.

Get the X factor into your retention - now.

(c) Hobart Creative Marketing

Source:

1. https://www.blcopywriting.com/what-the-hare-krishna-can-teach-you-about-marketing/

All other written material in this article  is written by and wholly the domain of Lawry J. Hobart and family.

More Reading

https://www.directcreative.com/influence-and-persuasion-the-rule-of-reciprocity.html