There are a lot of marketing tricks that businesses use to drill into your brain that you you must buy their product. Being aware of these can help protect you from your subconscious mind. Of course, the flip side is that if you are business, you can use these tricks to make more sales.
- Limited Time Offer – Act now! It is designed to stop you from hemming and hawing and just make the purchase. If you snooze, you lose out on the good deal. On a completely related note, today is your last day to take advantage of CollegeAdvantage’s free $50 dollars. Act now! [Update: The deadline is extended until the 18th!]
- Limited Availability Offer – The first 100 customers get a free extra Shamwow! Well, I don’t know if that’s really true of Shamwow, but you see it all the time in those infomercials. The thing is that the infomercials are running all day and night all over the country. So pretty much everyone is going to be included in that first 100 customers. They really have no way to track it.
- Affiliate Program – This isn’t so sneaky actually. A company, like the CollegeAdvantage offer above, offers to give people a commission for bringing them sales. It’s a cheap form of marketing for the company and they figure that you’ll probably take my somewhat less biased (but probably still biased) word that they offer a good product. In the CollegeAdvantage case, I had written about them in my choosing a 529 plan far before they had an affiliate program.
- The Surprise – A Trader Joe’s near me came up with the concept of Mystery Beer which I quickly dubbed one of the best ideas ever. It was literally a sealed brown bag of a selection of microbrew beers. Oh what fun to get to the car and see what you got! It brought back the feeling of collecting baseball cards when I was little (another surprise). Can you imagine the amount of sales McDonalds gets each year from people who just want more Monopoly pieces? By the way… that brings me too…
- The Contest – This is not always used to get you buy something, but more to get you to do something. You can see that you have a chance to win $5,000 from Taco Bell for giving them feedback on your service. That’s bargain-priced market research for a company like them. To explore how this might work, I ran a contest where I asked for readers Valentine’s Day tips and a few days later, I used those tips (with proper attribution) to write Save Money on Valentine’s Day (17 Tips Inside). It was cheaper than hiring a writer and more cost effective than me spending hours trying to research it. The end product came out better too, don’t you think?
- Portion of the Proceeds go to Charity – This is one of my favorites… especially when they don’t really say what the portion is. For instance, a company that makes $45 bottles of juice, MonaVie, has created a seemingly legit charity called The MORE Project. It’s a non-profit and don’t doubt that they do good work. However, I think the charity exists more to make MonaVie seem like less of scam to potential customers. That’s not to say all charity offers are bad, Coldstone Creamery has an annual event where I believe all the proceeds aid the Make a Wish foundation. Maybe the difference is that I don’t believe Coldstone needs to give back to support their competitively-priced product while MonaVie has to pull out all the stops to get someone to pay 10x more than what you would in a store.
- The Rebate – It seems like most people know about the rebate’s sneakiness… or maybe it’s just because I’m 33 now and my crowd knows it. When I was 20 though, it got me. The rebate is effective for two reasons 1) the difficulty in filling out the required paperwork… and 2) people’s… ahem… laziness. Between the two, a lot of rebates don’t get processed something that companies call “breakage.” If you see a company put a $300 television out there with a $50 rebate, the company can expect to really get $270 in money from that television as some will pay $300 and not get the rebate and some will get the $250 price after rebate. However that $250 price sure is enticing.
- No Payments for 18 months! – This is similar to the rebate. It seems like a great deal at the time and may make you buy the product thinking that you don’t have to pay. However, if you are one day late, you get 18 months of credit card late fees tacked on. These places are assuming that some portion of the people are going to pay late, so that’s just extra money for them. Even if all that money just goes to the credit card company, the offer helps the store make more sales.
- Charging a Premium Price – This doesn’t sound like much of a business trick. However, do you think Tiffany’s jewelry is better made than other jewelry? Are their diamonds different than diamonds you can find elsewhere? Do they have magical special silver than other companies don’t? No. They simply brand themselves as a high-end seller and people start to believe that owning the product is a symbol of status. This is why you don’t see Tiffany’s sell too much at a cheap price… it would erode the premium brand (and premium price) that they’ve built up. And you can’t forget about the price-placebo effect.
- Multi-Level Marketing – This is a lot like an affiliate program, but with a bit of a twist. Instead of a company just paying people a commission to sell the product, they put a hierarchy into the system where people can actually make more money recruiting other people. They get people excited to earn millions of dollars like the few people who were early in and now at the top of the hierarchy. I’m not a fan of such systems. As a consumer, I don’t want people pitching a “get rich” opportunity, especially when I can look at the numbers and say, hmm… 99% of these people aren’t getting rich. However, from the company’s perspective this is a cheap way to not only recruit millions of salesman, but also millions of customers by convincing them to buy the product themselves.
You may note that a certain company that I mentioned above actually uses quite a few of these business tricks.