My friend and colleague, Tom Myers, discovered the secret quite by accident. He sold lots of life insurance but also happened to be the ‘King of Annuity Sales’ in his agency.
“Whenever I went on a call,” Tom explained to me, “I made a calculated guess on what my prospect could afford and prepared an illustration based on that number. One time, however, I had two calls in a row and prepared a $50,000 proposal for one person and a $25,000 illustration for the next. Sure enough, I sold the first one but was disappointed to discover that I had left my second illustration at the shop.”
Not easily deterred, he proceeded to appointment number two when the light bulb moment occurred.
He told the couple, “I’m sorry I don’t have a personalized illustration for you but you need to see how this product works. Here is a generic one for $50,000 to show as an example.”
You guessed it. They purchased an annuity twice the size that he assumed they could afford. Never again did he present a proposal less than $100,000 and the volume of his sales increased immensely.
I recalled that incident from a decade ago when I read an interesting web quiz:
The question: When you know price is the biggest concern for someone considering buying one of your products, the first thing you should do is…
• Talk about the guarantee
• Show the most expensive product first
• Show the least expensive item first
• List additional features
• List additional benefits
The answer: Show the most expensive product first.
In one study, sales of pool tables were monitored to see customers who were shown less expensive tables, and then shown the more expensive models. The average sale worked out to be approximately $550 per table. For the second half of the experiment, customers were first shown top-of-the-line tables, priced as high as $3,000. After seeing the most expensive tables first, the customers were shown gradually less and less expensive tables. This time, the average sale turned out to be over $1,000 per table. Notes Mortensen, “After seeing the really nice, high-quality tables, the low-end tables were less appealing, so customers tended to buy the higher-priced items.”
Tom knew by experience in 1998 what this Fortune Magazine web article, written in 2008, reports.
Show your version (product/service) of the Lexus first and the VW last. Chances are better than even that your prospect will choose the top one or at least something in between!
Bill Sheridan—SHERIDAN WRITES, LLC
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