Fear of Loss: The Savvy Entrepreneur Series

The two strongest motivators in selling are the FEAR of LOSS and HOPE for GAIN.

When you're making your sales pitch, how often do you utilize FEAR of LOSS to persuade people to buy your product or service?

While many people claim that "fear of loss" is a negative tactic, it nevertheless is proven effective by many of the most effective salespeople throughout history.

Military Generals use fear to intimidate their opponents. Politicians use fear to throw their opponents "under the bus" and win elections. Business leaders use fear to position their company as the "gorilla" and their competitors as "chimps". Salespeople use fear to undermine the strength of competitors and maximize their own product's benefits to a prospective customer.

I recall a saying in the high tech industry, where it was widely known in the early 1990's that IBM, the large technology service provider, utilized FUD (fear - uncertainty - doubt) tactics to create doubt and undermine credibility of their competition to such a high degree they could charge 30 - 200% more than competitors for essentially the same levels of service. They also won business that otherwise might have gone to a competitor.

Examples of ways you can use FEAR of LOSS to position yourself as the best choice include:

"How can you be sure your current provider will be there when you need them?"

"Who will answer the phone at 3:00 a.m. when the system goes down?"

"What training have they received on the products they recommend?"

Some ways you can demonstrate you meet the fear or concern include:

"You're on our mind: With our "alert-status" 24/7 service and 4 hour response, you can rest assured your system's care is in good hands. Not only that, but our "proactive care" program will make sure you have fewer needs for alerts or downtime in the first place."

"You come first: With our "executive alert" plan you will know you always have top priority with our company."

"Your needs - delivered professionally: our people are trained on the systems you use. As a result, we're able to deliver more knowledge, keep your systems running with the least amount of hassle. This will keep your team focused on your business, and both save and help you make more money doing what you do best."

These are examples of marketing statements within the high tech industry that would position one company above another.

Individual competitive situations can get even more nasty. I once saw my coworkers work hard to win a large mainframe support contract - or so they thought. The agreement was signed by the CIO (Chief Information Officer responsible for technology at the prospective company) earlier in the day. During the "celebration dinner", the CIO received a phone call. When he returned to the table, he bore a troubled look on his face. "Fellows, I'm not sure how to say this, but I've been overruled and we're going with IBM," he said. He then explained that IBM made it clear that they might not be so agreeable to offer the code for their new chip if they weren't responsible for supporting the mainframe service. They cast doubt on whether updates would happen in a timely manner and basically said the customer would be a fool to switch vendors. They delivered this message by calling their "friend" on the board of the prospective customer. That board-member then overruled the CIO. That's how high IBM's relationship went. And that is how powerful the fear-tactic ended up costing a multi-million deal for a sales team that they'd seemingly won just moments earlier. Months of hard work and countless hours went down the drain.

Fear of loss is a strong motivator. Fear, properly applied, will help you win more often. Make sure both your marketing and sales pitch utilize this tactic.

Up next: HOPE for GAIN.

How has fear worked for you or against you in business? Comment below to contribute your experiences.
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Branding With A Sell and Tell

You may have heard that features tell, and benefits sell. Well, that may be true, but when it comes to branding, salesmanship ups the ante.

When developing a brand, whether for a website, a company, a new product, or service, consider the use of the "tell" and "sell" to build your brand.

Examples of websites that use the tell-and-sell (or sell and tell) strategy include the following:

Problogger.net - Darren Rouse's site uses "pro" meaning he's a professional, and "blogger" telling you that his site is about blogs.

BloggerBuster.com - This helpful site offers the sell "buster" and again "blogger" to tell you what it's about.

etailology.com - Another example of the tell and sell. eTail, meaning, retail but in an electronic or Internet forum, and "ology" is the sell - site features that build brand and sell (although they could tighten their slogan up a tad).

Examples of other famous brands or top brands that use the Tell and Sell strategy include:

Coca-cola - Coca-cola is known as the top brand of all time. Originally, the coca-cola recipe included cocaine. So, "Coca" definitely was the sell. "Cola" was the tell that described you were buying a soda. This brand also included the "word-blending" strategy by combining two words, as well as a word-abbreviation strategy. The result of coca-cola is a complex, and highly successful brand.

GE - General Electric is basically any appliance that uses electricity. A classic tell-and-sell brand.

HBO - Home Box Office is the most successful premium home video network. The tell is that the box office is in your home. The box office is the sell, meaning a theatre delivered to your home. With two channels, HBO and Cinemax boasted over 36 million subscribers as recent as 2006.

IBM - Originally, IBM stood for International Business Machines. You hardly ever see IBM use the full words of their name anymore. Why? Because they're focused on consulting solutions more than the sales of hardware. It is still a great brand, though.

Microsoft - the words Micro (small) and soft (software) indicate a small software solution.

Time, Inc. - Time magazine describes a sell: being a place in time, a meaningful moment in history, and hope of useful journalism about that moment. The tell, of course, is the magazine itself.

(List source is Business Week: http://bwnt.businessweek.com/brand/2006/).

A more complicated brand might be Google - "Google is a play on the word googol, which was coined by Milton Sirotta, nephew of American mathematician Edward Kasner, and was popularized in the book, "Mathematics and the Imagination" by Kasner and James Newman. Google's use of the term reflects the company's mission to organize the immense, seemingly infinite amount of information available on the web." Source: Netfronts.com (http://netfronts.com/guides/glossary2.htm).

My own company's name, ARRiiVE Business Solutions, is a combination tell-and-sell and a word-play. ARRiiVE is the "sell" in the word, and utilizes an additional "i" in the brand. Also, the large letters denote strength, while the ii's indicate that it's not just "i" going it alone, but "i" and "i" together creating a team. I have noticed that the extra "i" also created an intentionally mis-spelled word. I learned that technique from Sara Blakeley, from her mis-spelled company name and product name "Spanx" hosiery. Sara claimed people remembered mis-spelled names more than correctly spelled names. I'm finding this to be true for ARRiiVE, as well. Business Solutions is the "tell" in the brand, as we provide business solutions for launching products, improving sales, creating interactive marketing, and building teams to create more business success. Lately, I'm finding tremendous success helping draw traffic to websites using a combination of modern and old-world marketing strategies that works like a charm (email me to learn more).

Product or service names can also be a tell and sell. For example, I'm using www.coldtogold.com to be a tell and sell branding strategy for my sales training. Cold denotes a popular word for selling (cold-calling) and gold is the "sell" part of the phrase.

For example, Cisco's router strategy is to utilize the Linksys brand to become a household name. The tactic will probably pay off. Link - to tie together, sys - systems with a abbreviated name and name combination denotes a complicated, yet simple brand that ought to catch on.

How does your brand sell? Are you using a tell and sell in your product names?
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Copyright © 1999-2008 by ARRiiVE Business Solutions. Brands are trademark by their respective owners. No infringement intended. All Rights Reserved. SUBSCRIBE to get more.