This past Sunday, my wife and visited Total Wine in Naples, Florida. We were expecting company for the evening and needed to stock up on wine and spirits.
As she shopped for the wine, I found a bottle of Bombay Sapphire, my preferred gin, and put it in the cart.
After a moment or two, a staff-member came along and asked us if we had ever tried Citadelle gin. I volunteered that I hadn’t. He told me a bit about the distillation process, as compared to the Bombay, and that the Citadelle had a much smoother taste. However knowledgeable he was, I was skeptical.
He saw that and immediately said, “Buy the bottle. If you don’t like it, bring it back for a refund and I’ll drink the rest of it.” I laughed at the last part, but he was serious.
Bingo. Money-back guarantee with a bit of consumer education rolled into one.
I loved the Citadelle. So did my Tanqueray-drinking friends.
But think about this: a guarantee is only as good as the person/company offering it.
A while back I was providing sales strategy coaching for a company that had a significant software opportunity in progress. Our major competitor, a much smaller company with some growth challenges, was significantly undercutting us in price. How often have you seen that?
I thought we were in a position to offer a money-back guarantee if certain metrics weren’t achieved as a result of the implementation of the software. It was unheard of in that industry at the time. Behind my strategy was the fact that I knew the competition couldn’t back up a guarantee, even if they were foolish enough to offer one. We got approval from the VP of sales and CFO. It was to be a one-time deal, with a non-disclosure required. (The company wasn’t ready to go to market with this approach.) Yes, there were a few straightforward responsibilies on the part of the customer. But it was the real deal, and it was going to prove valuable.
Our salesrep offered the guarantee to the customer with his own bit of education. Ours was a public company. A quick look at the financials would enable someone to see that financial resources at that level weren’t a concern. We could easily refund the investment if, by some remote chance, the implementation failed. On the other hand, even at the low price another company might offer, if by some chance they felt they have to offer a guarantee as well, if they weren’t financially viable, it likely wouldn’t be worth the paper it was written on. I trusted this exchange was managed quite professionally.
The customer told the competition what we did. The competitor fell for the trap, offering a guarantee. What the customer saw were two very different companies. One with the right solution and the financial strength to stand behind it. The other desperate, trying to buy their business with few financial and other resources to make sure it all worked as promised.
We won the deal, at our price.
I guarantee certain services I provide to my clients. Reducing any perceived risk to zero has worked for me again and again.
Let me know your thoughts, please.
Graphic: stargone.com
