The Power of Risk Reversal

By: Wilson Cole
Date: 11/1/2007

For whatever reason risk reversal sends cold chills down the back of most small business owners and for the life of me I do not know why. First, let me ask you a question. If you had one of your best clients call you and tell you they were not satisfied with the services you provided what would you do? You would hear them out and if they had a legitimate point you would not charge them for the services or you would issue a credit. The reason you would do this is because you would want to do the right thing and you would hope they would continue to do business with your company. So if you were already doing that why would you leave all of that marketing capital hidden out of sight from your prospects and clients? How many more clients would you have if you told them  that if they are not completely satisfied then it's free?

What I am talking about is risk reversal. Whenever companies engage each other the assumption is that the purchasing company is the one that typically  holds 100% of the risk. But I just showed you in my previous comments that that is not true. So why not use what you are already doing to put your clients and prospects at ease. Think about that for a moment. If you and a competitor are going after the same prospect then think about the sales advantage you will have over your competition. Put yourself in the place of your prospect and you have a choice of your company and you are willing to guarantee the first 8 hours of the temporary or the first 90 days of the candidate that you placed. Think about the additional funds your company would have if it positioned itself that way 2 years ago.

With my collection company we promote our guarantee even though that is the way it's done in that industry a lot like the recruiting Industry. The recruiting Industry is the same way and in most cases guarantee the candidate for a period of 90 days. But the fact is they do not promote it because they are fearful that someone may take them up on it. So they hide behind the silence of what they already guarantee.

Let me share with you what almost 20 years in the collection industry has taught me. The type of person that will try to take advantage of you and steal from you will do so regardless of whether you have a guarantee or not. So in plain English if you offer a guarantee and they take you up on it because they are crooks they would not have paid you anyway. Let me repeat that one more time. If they are crooks and will use your guarantee to steal from you they would not have paid you anyway. The good news is that after almost 20 years in the collection business I can attest 99% of people are honest and want to do the right thing. The 1 % that are thieves will not pay you anyway regardless of your guarantee.

So my point is this. If you would already make things right, and the bad guys wouldn't pay you regardless; then why not leverage all of that marketing capitol and increase your market share. Shout it from the rooftops. Plaster it everywhere; even if you are in an industry where that is the normal way of doing business. Rule number one to closing more deals is this. The one who tells is the one who sells. It really is that simple.

What I want you to do is to think of a tag line that could sum up your guarantee. It needs to only be a sentence or two. Then I want you to put it on your email signature, your fax cover page, your website, and all other marketing materials that you send to your clients. This one technique will reduce your buyer's resistance and help you close deals overnight. Do not be scared and do not put what I refer to as a weasel clause into your guarantee, it needs to be straightforward and not watered down.

The guarantee that I use with Marketing Magic is if you do notmake five times the cost of my product with additional profit within a year simply return for a full refund. The only stipulations are paying your bill on time and attend 70% of our tele-classes. The fact is I may someday have to refund money and that is ok. If I sell 20 systems and have to refund 2 that is fine because without the guarantee I would have only sold 5 systems. Do you see how the math works on this? After you create your guarantee I want you to use it on five prospects. Really promote it and you will be amazed at how many more deals you will close.

Wilson Cole is founder of Adams, Evens & Ross and cofounder of Recruiting and Staffing Solutions Magazine. He is also president of Marketing Magic. He can be contacted at 877.266.2442, or by email at wilson@marketingmagiconline.com.