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One of the most powerful offers you can use in your advertising is the word Free.
But, you may well ask? how can I make a profit giving my products and services away without charging for them?
Which is the exact reason why you need to understand the 'LVC Formula' which stands for the Lifetime Value of a Client!
Here's how it works. Let's imagine for a moment you own a beauty salon. Now if you get a new customer, they may pay you $80 for their first treatment.
But how much is this $80 client really worth?
After all, most clients will continue to buy off you for many years to come.
For instance, let's imagine your average client returns for a beauty treatment 8 times a year? and remains a client for 2 years.
$80 (price of consultation) x 8 (purchases a year) x 2 (number of years)
Now if you have a calculator handy, you'll work out the value of this client as $1280.00.
And if your profit margin is 40% this calculates to a $512 profit per client.
Let's imagine we sent a letter to all the nearby businesses offering women a free manicure valued at $30.00 (I'm not a beauty therapist, so please forgive me if all these figures are way out).
And if the manicure costs you $7 in products and 30 minutes of your time (which if you're not busy? you'd just be sitting on your butt anyway!)
So effectively the $7 investment could have just made you $512 in profit.
And how easy is it to give away a free manicure?
Or for other industries?
·A free car service
·A free dancing lesson
·A free consultation
·A free ice cream
·A free report of some sort
The secret lies in giving away something which has a high perceived value, but actually costs you very little to produce.
Why does it work so well?
Using the word 'Free' in your advertising STOPS inertia. You see, people are happy with their current hairdresser? or their mechanic.
But when they get an opportunity to trial a product or service for FREE - there's something irresistible and risk free about it, isn't there?
A word of warning though. Make sure you offer the best possible service? otherwise people will not come back, and you'll get a bad name very quickly.
And of course, where possible, make sure you collect a database? and measure your results.
What could you offer for FREE? Write down a few ideas now? and start implementing this stuff.
It could have an almost overnight effect on your sales.
Scott Bywater
Copywriting That SELLS
Level 12 / 418a Elizabeth Street
Surry Hills, NSW, Australia
1300 88 21 91 / + 61 2 9282 6445
Scott Bywater is a professional direct response copywriter and the author of Cash-Flow Advertising. To get a complimentary copy of his special report '7 Ways To Increase Your Turnover... No Matter What The State Of The Economy' (valued at $29.95) and a free subscription to his "Copywriting Selling Secrets" ezine where you'll discover how to write ads and sales letters that make people line up and practically beg you to do business with them visit his web site at http://www.copywritingthatsells.com.au
MORE RESOURCES updated Fri. May / 03 / 2024 |
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