The Second Greatest Offer in the World

by Dean Rieck

It was just a plain jane mailer.

Cheap yellow paper with black and blue ink. No pictures, only copy. It was from The Teaching Company out of Springfield, Virginia. They offer taped lectures by prominent professors — philosophy, physics, economics, astronomy, literature, history, and other academic subjects that start my heart racing.

I remembered receiving mailers from this company before, although I had never purchased anything. As I glanced at this one, though, something caught my eye. They offered a lifetime satisfaction guarantee on every tape in their catalog.

What? I had to read that again. But there it was right on the front page and again spelled out on the order form:

LIFETIME SATISFACTION GUARANTEE
If you are not completely satisfied with the purchase you have paid for, you may return it with a note describing why you are disappointed and we will issue a full refund or credit your charge card for what you paid for the course or courses.

Now to understand just how powerful this is, keep in mind what this company sells. These aren't little audio tapes with 30 minutes of fluff, they're HUGE, in-depth taped lectures from some of the best minds in the country.

One is "How to Listen to and Understand Great Music" by Professor Robert Greenberg of The San Francisco Conservatory of Music. You get 48 lectures at 45 minutes each. We're talking 36 hours, folks! At a sale price of $149.95 for audio tapes and $199.95 for videotapes. And it's guaranteed for life.

When I saw that guarantee, I was sold. I thought, "I have to buy something for myself, maybe 'The History of Ancient Rome' or 'The Great Principles of Science.' And I can get 'The History of the United States' for my wife, the history buff. Where's my credit card. I gotta order something now!"

After all, with a guarantee that strong, these have to be the best tapes ever, right? I was absolutely convinced, even before I heard a single word. That's the power of a guarantee. That's why I call the money-back guarantee The Second Greatest Offer in the World.

Reducing Risk with a Guarantee

There's a quote by Ralph Waldo Emerson that says it all:

"The louder he talked of his honor, the faster we counted our spoons."

Too many businesses spend a lot of time merely talking of their honor. "We're the best." "Quality, service, selection." But it's all drivel. If you really have a good product or service, stand behind it. A guarantee isn't a burden, it's a boon. It's a powerful marketing tool. A solid guarantee is tangible proof that you're reputable, and it helps to lower the perceived risk your prospects feel.

And that's the key — risk reduction. Remember, in direct marketing, people usually can't personally experience the thing you're selling before they part with their money. They can't see it, hear it, touch it, taste it, or smell it. So there's always a level of uncertainty and risk.

Unchecked, this feeling of risk develops into one of your primary enemies — inertia. When in doubt, most people put off a decision. This applies to large purchases, but it is especially true for impulse buys. And "I'm not sure" is the same as "no" to a direct marketer because the longer a decision is postponed, the more likely a decision will never be made.

However, the sooner you can provoke a decision, the more likely it is to be in your favor. Therefore, you should simplify the decision-making process in every promotion to encourage a quick response whenever possible. And a guarantee is the perfect decision-making shortcut. A guarantee helps you lower the feeling of risk by answering silent questions: "Is it all you say it is? What if it isn't? Can I return it if I want to? Is there a catch?"

But there's another reason to use a guarantee — ethics. Thomas Rollins, president of The Teaching Company, said his company values clients so much, he simply doesn't want them to have any product they don't absolutely love. In our lively phone conversation, he said, "We call our lectures The Great Courses on Tape, and if we don't deliver great courses, we don't deserve the money."

Wow! Most people think of customer loyalty as customers being loyal to a business. But how about a business being loyal to customers? This is a recipe for long-term success if I've ever seen one. And it all stems from that powerful offer — the money-back guarantee.

A Guarantee is an Offer?

Now hold on, you're saying. Why are you calling a guarantee an offer — let alone The Second Greatest Offer in the World? If the guarantee reduces the feelings of risk, doesn't it serve in a support capacity for the primary offer? Aren't the offer and the guarantee different things?

Well, you're right. Sort of.

Technically, the guarantee is an element of every offer — just one of many parts, including the price, payment terms, and premiums. So it IS a support element.

However, it is also an offer, because you are making a promise: "You must be happy or I'll give your money back." Moreover, it is a tacit form of a call to action because you are saying in effect, "Try it. You'll like it. If you don't ..."

Plus, I want you to stop thinking of your guarantee as MERELY support for your offer. I want you to show it off, bring it up front, treat it as strongly as you do any offer. So if you have a primary offer, I want you to think of your guarantee as a secondary offer. Of course, you can feature it as your primary offer as well.

And remember, with few exceptions, most guarantees offer money back in one form or another. It is specifically this "money-back" guarantee that I'm calling The Second Greatest Offer in the World. As for the greatest, please be patient. I'll get to that momentarily.

The Basics of Writing Your Guarantee

A guarantee may be the most important copy you ever write, but it isn't rocket science. Your guarantee should do four primary things:

  1. Assure your customer of the quality of your product.
  2. Spell out your terms and conditions clearly.
  3. Specify a generous time period for evaluation.
  4. State what you will do if the customer is dissatisfied.

Here's the classic guarantee:

We provide the finest widgets in the world. If you are not fully satisfied for any reason, just return your widget within 60 days for a full refund of your purchase price.

You can be more personal. Or stronger. Just keep it short and sweet.

Also, make sure you're not promising something you don't intend to. Make sure what you do promise is legal. And make sure your guarantee will stand up in court if you have any customer complaints down the road.

And what about setting limits? You might have a time limit: "If you're not satisfied, return within 30 days for a full refund." You might have usage conditions: "With normal use ..." or "When used according to directions ..." You might have a liability limit: "Liability limited to the replacement cost of this item." You might want to specify repair or replacement rather than return: "If it doesn't work as promised, we'll repair or replace it free." But don't use limits unless you must.

And for heaven's sake, avoid legal-looking teeny type and asterisks. Unless you are subject to heavy regulation or have a reasonable fear of some specific problem, keep it simple. After all, why alienate all your honest customers to protect yourself from a handful of unscrupulous ones?

Boosting Response with Your Guarantee

There are thousands of techniques in direct marketing, but very few are universally applicable. And even fewer can promise to raise response each and every time you use them. However, the guarantee is on this short list.

Guarantee = Customer Benefit

No one has to buy from you. Your customers are doing you a favor by making a purchase, not the other way around. So offer your guarantee is just one more solid benefit of dealing with your business. Make it strong enough to persuade the fence-sitters to act.

And if you say it, mean it. Make sure everyone in your organization understands the guarantee inside out, especially phone operators, complaint handlers, management, and anyone else who deals directly with your customers.

Don't be afraid of a guarantee — ever. It will almost certainly create more profit than will be lost through the few people who will take advantage of it. A high rate of return is simply evidence that your product or service is defective. Thomas Rollins from The Teaching Company says his returns are minuscule compared to his profits. And that's been my experience with every client I've worked with.

Here's a simple, elegant guarantee from an L. L. Bean Christmas catalog:

Our products are guaranteed to give 100% satisfaction in every way. Return anything purchased from us if it proves otherwise. We will replace it, refund your purchase price, or credit your credit card, as you wish. We do not want you to have anything from L. L. Bean that is not completely satisfactory.

Here's a classic guarantee from the Sears, Roebuck and Co. catalog from 1902:

We accept your order and your money, guaranteeing the goods to reach you in due time and in perfect condition, and if they are not perfectly satisfactory to you when received, you can return them to us at our expense of freight or express charges both ways and we will immediately return your money.

The Greatest Offer in the World?

Did you guess it?

The only offer better than promising to give your customer's money back is to never ask for money in the first place. So the free trial offer is The Greatest Offer in the World. But we'll save that for another time.

For now, I just want to sit back and enjoy listening to Professor Alex Filippenko of the University of California at Berkeley explain the origins of the universe. Considering that his lecture spans 20 billion years, I'm sure I'll develop an all new appreciation for that "lifetime" guarantee.

Copyright © 2000 Dean Rieck. All Rights Reserved.
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