How to Make Money By Giving Things Away
How to Make Money By Giving Things Away
As a few of you know, because I have been beating the subject to death, we give belts away. We install them for free. The only ones we charge for are Eureka R belts & geared belts. I was curious exactly how much this changed our business. After a few hours of research I found out. The results were suprising.
In June of 2003 we were still charging for belts. So I took the belt receipts for that month & came up with these figures. In June 2003 we sold 132 belts for $1.50 & 4 belts for $4.95 each. Thats a total belt business of $217.80.
We started putting belts on for free ( no charge for belt or installation) mostly with elderly people. A strange thing happened. We started getting people coming in, buying our higher priced machines; telling us that the reason they came in was that we treated their friend very well. That we put a free belt on for them. THAT'S why they came here to buy & not somewhere else.
After a few months of this happening, it finally dawned on me that there was no law preventing me from giving free belts to EVERYONE. So we did.
We took the figures from January May of this year,We tracked how many sales were a direct result of these free belts. Here are the results. We average just a few dollars more than $6,000 more in business PER MONTH as a direct result of these free belts. Let's say that the cost of the belts is $68. (50 cents per belt). That's a return of $6,000 on a $68 investment. For me at least, any reason not to do this just went out the window.
If you do not sell new vacuums or refuse to sell (believe me, it happens). This will not apply to you.
Now why does this work? RECIPROCITY. It's a fundamental law of selling & marketing. Give before you get, Sow before you reap. Cause & effect.
We have been giving gifts to establish relationships & unspoken obligations for at least 5,000 years. Why? because it works.
When I was selling In Home, & the customer sold a cheap product (like crafts) I would always buy at least one. Always. And I don't remember ever not selling in that situation.
These sales account for 22 % of our gross business. Those are only the ones we are SURE came from the free belts. Tracking sales pays off, it seems
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