If you've been in business long enough, you'll remember that once a year the phone book advertising representative would visit. We'd go into the meeting thinking we can afford $300. An hour later we'd come out with a $2,000 a month contract signed. Right?
Why did we agree to the high fees?
The phone book felt like a shakedown, but at the time it seemed like the only way to attract new business to our store. It was the first place people would look when they realized they needed what we happen to sell. It was our one chance to get their attention before they went somewhere else. We knew it, and unfortunately our phone book rep knew it too.
But why did we let ourselves get talked into a monthly budget that was out of control?
FOMO (Fear of Missing Out)
We had to get our phone book marketing right for the whole year. If we saw opportunity, we better take it. Otherwise we'd regret it. It was that FOMO that made us vulnerable to a great upsell.
And our rep wasn't really selling those awkwardly designed ads. They were selling the chance for us to do better than the store down the street.
We could improve our phone book listing with eye-catching options that seem a little ridiculous now:
- bold text
- all caps
- better placement
- a larger ad
- a colour ad
Each upgrade cost us. But once we could see that bold text would land more sales, you couldn't stop us.
The anonymous threat out there
The clincher was that we knew that after meeting with us, our phone book rep was going to walk across the street to their next appointment, and offer the same upsells to each of our competitors. We could only guess what our competitors would choose, and try to outsmart them. The same way they are trying to outsmart us.
If there was no anonymous threat, all of the stores in town would pick the least expensive phone book listing. The fear of the anonymous threat is extremely compelling in sales.
So why am I writing about phone books now?
FOMO is alive and well
The FOMO sales model is used in online marketing to small businesses. And instead of being sold to once a year, we're buried in daily communications about 'essential' opportunities from an endless list of products. Each created to address our overwhelm, help our business run better, and guaranteed to get results.
A lot of businesses don't even know how much they are spending in monthly fees from these products.
But do the products really work?
Maybe sometimes, but for the most part, likely not enough to justify the cost.
The trouble is that companies that market these products use the very same language from one product to the next. It's really hard to tell the difference between something that is actually invaluable and something that is sucking your hard-earned money out of your business.
What the phone book had going for it, was that even though it was expensive, it actually did get us new clients. So each year we'd have that conversation with the rep, and find ourselves spending more than we had anticipated.
For the most part, the products that businesses are investing in now don't get renewed year after year. And that's because they don't deliver enough value.
Often, there is a year-long contract needed, high setup fees, and/or a monthly fee, with no accountability for results. All are red flags that point to a one-sided relationship with the vendor. But worst of all is that many involve a huge amount of effort to use them properly. This is never mentioned in the sales process. What's crazy is that even though the experience is a failure, business owners are often left feeling good about their decision to purchase, but blame themselves for not following through. It's a lot like a gym membership that just keeps charging your account long after you've stopped going.
So what can we do?
1. Find out what's actually being promised by the sales person.
Get it in writing, or at least take screenshots during the sales webinar. Record your phone calls if you need to. If they aren't promising any actual sales, the price should reflect that. How much are you willing to spend on something where you are taking all the risk?
2. Talk to other businesses to see what's working for them.
And not what's cool or the thing they're currently excited about. What is their go-to for drumming up sales when they need to?
3. Never ever ever set it and forget it
Test the results, and ask for a refund if they don't deliver. If they ghost you, do a charge-back on your credit card so they need to prove they delivered what was promised.
If you don't know how to test the results, figure that out before you buy. if you don't have time to test the results, just don't buy it. Buy saying no, you'll likely end up with more money in your pocket, less stress, and maybe even some some of that much needed down-time.