I have a confession to make.
Although, as a businessman, I’m a direct marketer…
As a CONSUMER, I make a regular habit of ripping off direct marketing companies!
And if you follow the advice I’m about to give you, you can—as a consumer—get some of the greatest deals on Earth…by “ripping off” direct marketing companies like I do.
But much more important, by following these strategies as a MARKETER, you can generate truckloads of orders and sales…by making offers that seem so irresistible to your potential customers that they feel as if they are almost ripping you off by taking it!
Now, when I say that I have “ripped off” direct marketers, I’m not talking about illegal or immoral rip-offs, such as ordering a product and then not paying the bill—knowing full well the direct marketing company is unlikely to ever collect such a small debt from you.
I mean taking advantage of direct response offers, keeping the premium, and then immediately canceling or returning the product…just to get the free gift!
For instance, Gevalia Coffee has the most incredible offer you can imagine in their print ads and online marketing.
You just sign up for their monthly coffee service, and get the first shipment of two coffees for $10…plus a FREE coffee maker!
Well, I took the bait. Sure enough, you get two delicious gourmet flavored coffees—well worth the $10 alone—PLUS a beautiful coffee maker.
I immediately canceled the service as soon as I got the machine and the first two coffees…so the whole kit and caboodle cost me a grand total of ten bucks INCLUDING the free coffee maker!
Where else on Earth can you get a deal like that? And what’s the lesson here for you as a marketer?
It’s this…
Direct marketing companies routinely make overly generous offers on the “front end” to get you in as a customer – giving extraordinary value worth far more than the nominal purchase price they are asking.
Why are they so generous?
Not for their health. Or reasons of altruism.
But because they know that a large number of people who take the bait will stay to buy more…and so the offer will be profitable in the long run.
Yes, a few consumers will take advantage and respond with no intention of retaining their subscription, membership, or monthly deliveries.
But only a small percentage of buyers will do so…and the savvy direct marketer knows that this is merely part of the cost of doing business.
(Direct marketers call customers who order, keep the premium, and then cancel the order “premium bandits.”)
These marketers precisely calculate how much they can afford to give away on the front end, based on customer lifetime value, to maximize response while maintaining a good ROI.
In fact, they WANT people to take advantage of the offer and send for their generous freebies. And here’s why….
Even though many consumers may respond JUST to get the free coffee maker, and then cancel—once they taste the delicious coffee, a large percentage of those who just wanted the gift will remain with the program…buy expensive gourmet coffee month after month…and spend a lot of money with Gevalia.
(Despite just mainly wanting a good coffee maker, I almost stayed with the program…except I am trying to cut down on caffeine. But I told several friends about this great offer; and two are now regular Gevalia buyers…so my “rip off” is already profitable for Gevalia!)
Another example of a direct marketer whom I have greedily “ripped off” is Easton Press.
I accepted their offer of a beautiful leather-bound edition of Moby Dick…and paid just $5.95 (the average price of their leather bound classics is around $50).
I immediately canceled out of the continuity program (“The 100 Greatest Books”), so you’d think I got something for (almost) nothing from Easton.
(Why did I cancel? I love books. But I didn’t want most of the volumes selected for the “100 Greatest Books” series…so it was a matter of not being offered the right choice of product.)
But…Easton Press kept sending me more mailings for other series and single books that were more to my taste. Beautifully illustrated mailings—irresistible to a book lover like me.
(That’s another direct marketing lesson, by the way: the people who bought from you most recently are the ones you should be mailing to most frequently.)
And now there’s a pile of about $400 worth of gorgeous leather-bound books on the shelves of my home library—and countless hours of enjoyable reading ahead for me.
So, who’s really coming out ahead here?
Well, I love the books. And Easton Press now has a regular customer—even though I didn’t intend to become one. So it’s a win-win scenario for both of us.
The bottom line is this: The goal of direct marketing is not really just to make money on a first sale…although that’s nice to have.
It’s to get as many customers in the door as possible at an acceptable ROI based on average lifetime customer value, not the size of the first order.
So the most profitable testing you can do is on the front-end offer…and often, the more generous it is (to a point, of course), the more money you as a marketer ultimately make.
Bob Bly is the author of “World’s Best Copywriting Secrets” and has written copy for more than 100 companies including IBM, Boardroom, Medical Economics and AT&T. He is the author of more than 75 books and a columnist for Target Marketing, Early To Rise and The Writer. McGraw-Hill calls him “America’s top copywriter”.