Give Away The Razor, Sell The Blades


I’m not sure who first had the idea of giving away razors and charging an outlandish price for the blades, but whoever it was—it worked. The same strategy has been employed by the printer industry. One can purchase a printer for your PC for almost nothing, but you want new ink? That’s going to cost you! I have a friend who found printers on sale at a major chain and bought several of them—because buying the printer was cheaper than purchasing the ink cartridges that were inside!

The point of all of this is how can you use this strategy in your business? Not necessarily “what can you give away?”, but how can you make it easier, more convenient or less expensive for customers to begin their relationship with you with the knowledge that your profitability will come from them BEING customers, not BECOMING customers?

Think about it.

One doesn’t have to give away their product and charge outrageous backend sums to continue the relationship, but what can you do to make it easier for prospects to become customers?

Satellite television is another great example: today it is virtually free to get started including equipment (unless you want DVR’s, etc) but then you pay an ongoing monthly fee—forever.

Smart phones continue to drop in price—as long as you have a call plan with a provider.

I could go on for days, but you get the point.

Think about how you can make it easier for the prospect to make the decision to begin the relationship with you—then make that relationship last—and make it profitable for both of you.

Be creative. Experiment with things that have never been done before—hold nothing back. But, put yourself in your customer’s shoes and ask: what do I want out of this relationship? What would make it beneficial for me? What would make me become a LONG TERM customer?

Then you’ll be well on your way to creating new customers and new sales!

 

Question: Do you have a sales related question for the mailbag? Email me at butch@redcapsalescoaching.com

Comments

  1. When I buy a cheap electric razor I use it for years. Typically, the blade wears out, and there is the choice: buy the replacement blade or buy the razor — they are almost the same price. I buy the razor.

    This time, my slightly more fancy electric razor died because a cat ate through the charger cable. I called the parts manufacturer after doing some research [parts are not readily available in stores], and found out that replacing the adapter would cost 50% of buying a brand new fancy electric razor. I will, most likely, buy the new razor. [Update: I just checked Amazon and found it for less, and am considering buying it there.]

    My point is: if an electric razor costs $35, and its blade costs $32, and its charger costs $30, what will the average consumer do? Buy a new razor.

    Okay: so every supplier involved in the sale just made a little less money, but everybody made money. The economy keeps going at decent speed. Mom and pop keep their jobs. Investors are happy.

    But I just bought more stuff than I needed. I just needed a charger.

    It seems like we could model our economy so that people still live happy lives without having to make razor blades, electric components, razor shells, and chargers for folks like me who just need a charger.

    Your example about printers was perfect. That person, like I might do, just sent a signal to printer manufacturers that there is a lot of demand for new printers.

    Wrong.

    Someone just did the math and determined that buying the printer was more personally economically beneficial than buying the ink cartridge.

    The result is that we have an economy which tells people it is a better idea to buy a whole lot of things at almost the same price as it costs to buy just what they need. [Grocery stores do this, too.]

    Can we back down from this? Should we? What do you think, Mr. Bellah?

  2. Author

    Erik:

    I wish I knew the answer. It is a vicious cycle. But, from a sales perspective we must always focus on giving the customer what they want. NOW, with that having been said, if someone were to come out with just a charger–even if it is at a slightly higher price than a normal charger, but you didn’t have to buy everything, I assume you would buy it. That’s where innovation comes in.

    It reminds me of the story from Jay Abraham’s book about the toilet being invented in the 1500’s and toilet paper in the 1800s. Sometimes the obvious isn’t so obvious.

    Butch

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