Attract New Customers with a Strong Guarantee

Whether due to the global economic condition, the export of jobs to slave wage nations such as India and Russia, or the overall need for self-fulfillment in the wake of the World Trade Center attack – more and more people are freelancing or starting their own businesses. Personal coaches, copywriters, shareware
developers, marketing consultants, and website designers are springing forth from the ranks of the un(der)employed.

As different as all of these occupations might seem on the surface, each one faces the same dilemma – the need to win over new customers. In my book, me-Commerce™, I provide tips and techniques for becoming an entrepreneur, including attracting and landing new customers and leveraging that first customer to
snowball into a revenue stream.

In this article, I will focus on one of those techniques – the Power of the Strong Guarantee.

Most customers realize that a guarantee is only as good as the company or person standing behind it. How many horror stories have you heard of the "lifetime guarantee" in which "lifetime" apparently meant the lifetime of the company, not the lifetime of the customer? Plenty of companies go bankrupt when refunds
exceed income, leaving customers in a bind and quite a bit more cynical.

With most products and services, however, the chances of needing to support a "Lifetime Guarantee" are slim. Generally, all that is necessary is a guarantee that a new customer will be satisfied and that they will get what they’re expecting. However, unless that guarantee is actually spelled out, customers will wonder exactly what happens when something goes wrong.

A good guarantee will help calm the fears of new customers who are weighing their alternatives. If one company provides a guarantee, and the other doesn’t, it should be pretty easy. When customers see this situation, however, they might actually ask the competitor, "Hey, do you stand behind your work, too, like these guys do? Here’s what their guarantee says..." Of course, the competitor will want to please the customer, and formally
state a similar guarantee in order to win the customer over.   And there goes your competitive edge...
 

How can I win the new customer with my guarantee?
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You do this by making your guarantee not just good, but GREAT!  Make yours a strong guarantee -- so fantastic, in fact, that competitors will be afraid to match it.

- Offer an incredibly fast turnaround time,
- Offer money back,
- Offer double their money back
- Offer a long-term satisfaction guarantee – 30 days, 6 months, 1 year
- Offer free problem resolution / support

Here's the guarantee that my wife's custom software development business, Envision Software, Envision uses with most of its clients. Bear in mind that with contracted services, the guarantee changes here and there to meet the needs of the customer and project.  While every contract has unique demands, most smaller companies are satisfied with this guarantee:

"If you find any defect within 90 days of installation, we will fix it, at no additional charge, within one business day, guaranteed."

How can Envision afford to make a guarantee like that?
By being good at what they do. It’s that simple. It doesn’t end up costing a lot to come back and fix defects, when you never have to! By paying a lot of attention up front, what they deliver is pretty darned good – they make sure of it. What leaves the shop has the Envision name on it, and defective products don’t leave
the shop. Period.

If you’re not darned good at what you’re doing, you’ll soon be out of business anyway, as commercial Darwinism takes hold of your company and shakes the life out of it. If you find yourself in this situation, you can leverage a strong guarantee to ensure that, at very least, you have a few happy customers to use as
a reference when you’re looking for a J.O.B. after the business folds. However, by touting a strong guarantee, you just might find that your priorities shift. And now that you have to honor that strong guarantee, you end up keeping the business alive far longer than you ever imagined possible.

All Guarantees are not created Equal, or Bad Guarantees: An Example in the Negative
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Just as a great guarantee can motivate, so, too, can a guarantee full of "weasel words", only in the opposite manner. A guarantee that has precise conditions you must follow or sneaky wording to qualify will trigger a red flag in people’s minds. This warning might only be subconscious, but the customer will feel the need to take some time to consider your offer. During that "out of sight, out of mind" period, they might just decide against using your product or service, lose your URL or business card, or start watching Springer and simply forget about you and your fantastic product or service.

Currently, Envision relies nearly exclusively upon referrals, and it generally handles just a little more business than comfortable. In examining opportunities for bringing on more help and expanding, they considered investing in something a little unusual for them– Yellow Pages Marketing. Not being an expert in this arena quite yet, I decided to seek one out to ally with. In my search for a company to help me craft the yellow pages advert, I stumbled across an example of a weasel guarantee. My emphasis is added to reflect my perception as I read the guarantee (names have been changed to protect the not-so-innocent):

"You'll be 100% CONVINCED that your new AcmeCorp Yellow Page ad WILL dramatically increase readership, telephone calls and revenue for your business... or we'll cheerfully refund your money in full!"

At first pass, this seems pretty decent. "It’s guaranteed! – Oooh!  and a 100% guarantee, at that," I think to myself. "I should get more calls and money... yeah, yeah... So far so good..."

Now wait a second! What’s this? I’m guaranteed to be CONVINCED that the ad will make money and generate calls? What does that mean exactly? Personally, the only way I’m going to be convinced that my ad WILL generate more calls is when I hear the phone ring.  The only way I’m going to be convinced that I WILL get more
revenue is to see the bank statement with that money already deposited. I’m from Missouri. Show me!

I may not know every last thing about marketing. But, one thing I do know is that MY perceptions of an ad amounts to a hill of beans when it comes to what TRULY matters. And what truly matters, and matters exclusively, are RESULTS. I’ve seen gorgeous web pages that seem at first like they’d rake in the cash but
result in absolutely nothing. I’ve seen barren web pages with typos everywhere and a "Buy Now" button seemingly generate sales from thin air. What I’ve learned in my years of web marketing is that it’s almost impossible to "predict" or "believe" these results to become reality, and no amount of "convincing" is going
to make me change my mind on this. The only way you can tell what’s really going to happen is to run it and see what happens.

So, if that’s truly their guarantee – that I’ll get more calls and more revenue, I want a SOLID guarantee of exactly that, not these weasel words that guarantee I can be smooth-talked by some fast-talking salesman into believing that it will pay off.

Incidentally, I thought I’d give these guys a chance to truly stand behind their product, so I emailed them my above-stated concerns. Their response was even more weasely than the guarantee I inquired about:

"The vast majority of our customers know an effective ad when they see it... I've found that the very small number of customers who are unsure or skeptical wouldn't know an effective ad if it reached up and bit them in the butt... To be perfectly frank, these are not the type of customers we're seeking to attract and work with."

Excuse me? I thought the work was GUARANTEED? This isn’t religion, buddy; it’s BUSINESS. My skepticism should have nothing to do with the effectiveness of the finished product. And the guarantee you give me should make sure that I know, regardless of how skeptical or ornery I may be, that my phone will ring, and my revenues will increase simply because of the effectiveness of the product or service I am buying from your company.

The short of it is this: If the new customer can’t feel 100% trust in your product by the wording of your guarantee, then how in the world can they have any degree of confidence in your ability to deliver the product or service? Your strong guarantee should be exclusively designed to assure the new customer that their decision is a wise one.

The only way I’d allow any of my mentoring clients at www.ConsultingMentor.com to promote a guarantee like this, is if they told me that they were hoping to drive away 99.9% of their customers through fear of being taken advantage of.

Personally, I think the best guarantee for them should be short and sweet, obvious and RESULTS-oriented:

"Guaranteed to earn you at least twice the cost of placing the ad within the first year and generate twice the calls of your old ad... or we'll cheerfully refund your money in full and pay for the ad placement!"

Now THAT would be a solid guarantee. Who could possibly resist buying from the company making a claim as outlandish as that? And what competitor would be insane enough to COMPETE with it?