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Ok, I've always been innovative. I try to think outside the bun. Things that are a little unconventional like encorporating AutoPay and NOT doing contracts, have just seemed to work very well for us. Not that any of the stuff I do are my own unique ideas. It's just that I don't always follow the crowd. And in that line of thinking.....
I was thinking about how big companies market these days. And how I might encorporate their ideas into my own business. For instance, did you know that Hewlett-Packard on $100-$200 for every printer they sell? "Why would they make printers, then?", you ask. Good question. It's a marketing ploy. They lose money on the printers knowing that they will make it back many times over on their overpriced printer cartridges!
Same with Microsoft MSN internet service. Ever see those deals at computer stores where you get an instant $400 rebate on any electronics device just for signing up for MSN? Why would they do that? Because they make bind you into using their overpriced service for 2 years - and make their money back that way.
Now ask yourself this question: Why do people fall for this kind of stuff??? Are they stupid? Ignorant? Or is there another reason? I'd say some of them are stupid or ignorant, sure. They just see a deal and hop on it without considering the ramifications of what they're committing to. But I'd venture to say that more people know JUST what they are getting themselves into and don't really mind! They'd rather pay a little bit more month-by-month than they would pay all of it up front. They'd rather save money now and pay a little more along the way than to pay it all now.
So some people just LIKE that idea - of buying now and paying later. Fine. That's the kind of society we live in. And it's obviously making some people very wealthy by capitalizing on it. So how can I encorporate that idea?
Well, what if when I installed a new landscape or irrigation system, I offered the client a super deal! That is, they could get their $3500 irrigation system for only $2500 if they'd sign up for my [albiet overpriced] landscape maintenance package at $195 per month, for the next 2 years. Maybe I'd normally only charge $125 for maintenance there. So $195 is overpriced, but I am now making $75 per month, for at least 2 years and possibly much longer! So I am knocking off $1000 from their install, but making at least $1680 off of maintenance (over 2 years).
AND - here's the kicker - I am picking up a new maintenance account too!
Now, I'd probably only do this with a firm 2 year contract and make it AutoPay only. And if they sold their home or whatever, then the remaining balance would be due immediately (which is just how MSN does it if you cancel before the 2 years).
And the great thing is it's only an option. People don't HAVE to do it. They are still free to pay the $3500 on their install. But for those who chose to take the $1000 off deal (which is a lot of money and BIG incentive!), then I stand to profit even more!
One more potential benefit I just thought of - this option now makes you potentially the lowest bidder on the install job. Say the client gets 3 estimates. One for $3,200, one for $3,900 and you'rs for $3,500. BUT with the $1000 off option - yours is now the cheapest bid! Maybe this would result in landing more install bids.
I dunno. Just something I've been thinking of. I don't really see a downside to just making this optional offer. What do y'all think?
I was thinking about how big companies market these days. And how I might encorporate their ideas into my own business. For instance, did you know that Hewlett-Packard on $100-$200 for every printer they sell? "Why would they make printers, then?", you ask. Good question. It's a marketing ploy. They lose money on the printers knowing that they will make it back many times over on their overpriced printer cartridges!
Same with Microsoft MSN internet service. Ever see those deals at computer stores where you get an instant $400 rebate on any electronics device just for signing up for MSN? Why would they do that? Because they make bind you into using their overpriced service for 2 years - and make their money back that way.
Now ask yourself this question: Why do people fall for this kind of stuff??? Are they stupid? Ignorant? Or is there another reason? I'd say some of them are stupid or ignorant, sure. They just see a deal and hop on it without considering the ramifications of what they're committing to. But I'd venture to say that more people know JUST what they are getting themselves into and don't really mind! They'd rather pay a little bit more month-by-month than they would pay all of it up front. They'd rather save money now and pay a little more along the way than to pay it all now.
So some people just LIKE that idea - of buying now and paying later. Fine. That's the kind of society we live in. And it's obviously making some people very wealthy by capitalizing on it. So how can I encorporate that idea?
Well, what if when I installed a new landscape or irrigation system, I offered the client a super deal! That is, they could get their $3500 irrigation system for only $2500 if they'd sign up for my [albiet overpriced] landscape maintenance package at $195 per month, for the next 2 years. Maybe I'd normally only charge $125 for maintenance there. So $195 is overpriced, but I am now making $75 per month, for at least 2 years and possibly much longer! So I am knocking off $1000 from their install, but making at least $1680 off of maintenance (over 2 years).
AND - here's the kicker - I am picking up a new maintenance account too!
Now, I'd probably only do this with a firm 2 year contract and make it AutoPay only. And if they sold their home or whatever, then the remaining balance would be due immediately (which is just how MSN does it if you cancel before the 2 years).
And the great thing is it's only an option. People don't HAVE to do it. They are still free to pay the $3500 on their install. But for those who chose to take the $1000 off deal (which is a lot of money and BIG incentive!), then I stand to profit even more!
One more potential benefit I just thought of - this option now makes you potentially the lowest bidder on the install job. Say the client gets 3 estimates. One for $3,200, one for $3,900 and you'rs for $3,500. BUT with the $1000 off option - yours is now the cheapest bid! Maybe this would result in landing more install bids.
I dunno. Just something I've been thinking of. I don't really see a downside to just making this optional offer. What do y'all think?