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Services | Support | Coaching Lessons | Affiliate Program Solo Build It Mastery Lesson 49 - How A Simple Refund Turned Into A Customer Service Debacle...Hi again and welcome to this lesson. This is a long article, but please read it through to the end because it contains an important lesson that every business owner must know and understand if they are to build long term wealth from their business... Today we are going to look at a recent experience a friend of mine had when she tried to get a refund on a product that she thought wasn't satisfactory. And you'll see a classic example of what NOT to do when somebody asks you for a refund on one of your products. Ok, let's get into it... As a business owner, one of the cardinal rules is 'Look after your customers'. Now your customers aren't always right, in fact, they are quite often very wrong :-), but you have to look after their needs, after all, their money pays your bills... Sure, some of them need firing every now and then to help us keep our sanity, but for the most part, your job is to nurture and build relationships with people, don't go out of your way to p*ss them off, and generally deliver information, education, sometimes entertainment or life lessons, along with the products and services they need and want to buy, with the goal of creating customers for life. The first step in this process is to make sure your customers' first (and hopefully subsequent) buying experience is a good one. Then you move first time customers through your sales process where they buy additional products and services from and through you forever and ever. But you've gotta get that first sale right or you will have little chance of there being a second sale any time soon. Here's a classic example of what NOT to do when you are confronted with an unsatisfied customer wanting a refund. Here's The Story... Kim (not her real name, but the story is 100% true and as told to me) ordered an ebook from a fairly well known (in options trading circles) options trader last week to check out what he was offering. Now this ebook costs $110, so it's not some cheap $27 read. She read through the sales letter and prominently displayed is his guarantee - here's exactly what it says... 12 Month Money Back Guarantee! Risk free, right? Iron Clad Money Back Guarantee, OK? Wrong! I won't go into all the gory details, but let's just say that she was very disappointed with the content of the book - it was reasonably well written but contained nothing in the way of new information that Kim hadn't read in half a dozen other entry level books on options trading, plus it had a LOT of filler and fluff in it's 60 pages. In fact, according to Kim, the book contains just enough information for beginner readers to get themselves into a lot of trouble in the options market. After reading the book she was dismayed that she had paid so much for what was obviously nothing more that one options strategy sort-of half way explained, a couple of Camtasia videos and a lot of filler material. She certainly didn't think it was value for money at $110. Now the main product this guy offers is a trading alert service that tells subscribers every time he takes a trade so they can follow along with their own money in real time if they choose to. The top level alert service costs US$125 per month (US$1500 per year), and the other thing that annoyed Kim was the only way you could access this service was if you had previously purchased his overpriced ebook. The goal of the ebook is to obviously give people enough information to come to the conclusion that they need the monthly service to trade. Great idea, if it works... By now Kim's thinking, nah, this one's not for me, so she sent a short email asking for a refund, saying that the book was not for her, and thought nothing more of it. Imagine Kim's surprise when she received this email back shortly afterwards - Sorry Kym, but currently you don't qualify for a refund. You have to show us that you tried the system by taking actual trades in the market and it didn't work for you. This is clearly spelled out in our Guarantee Policy on the website. Regards, A Kim thought about it, re-read the guarantee, and fired off another email explaining in detail what she thought of the book and demanding a refund. She received a reply a short time later from the options trader himself (I'm thinking is that really the best use of his time??) giving her the third degree, accusing her of ripping him off, and carrying on with all sorts of other ramblings about her needing a mindset change and other crap. Well she told me you could have knocked her over with a feather... Bottom Line: To get her $110 back, Kim has to risk thousands of dollars of her capital to the vagaries of the market based on the limited amount of basic information in the book and test the strategy an unknown number of times to qualify. There are lots of things that can potentially go very expensively wrong in the options market - bad fills from the Broker, making mistakes in the order, market crashes, company specific problems, and all sorts of unknown risks... And Brokerage on each trade costs $120 or more (more than the cost of the ebook) as well, so that's another expense. Testing the strategies could quite possibly have cost Kim several thousand dollars...to get a refund on a $160 ebook. Yeah right! Now come in closely here and listen up, because this is important. Most business owners are too afraid to offer a 'real' guarantee, a guarantee with some balls! I see this all the time. Great offers or guarantees ruined by cheesy weasel out clauses. You've gotta get this right. Either offer a great guarantee or don't. Stand by your product, or don't. And if you can't offer a kick-butt guarantee on the products you're selling now, stop selling junk and start offering your customers products that you can offer a great guarantee on. The goodwill you'll destroy by making a crappy non-guarantee like the one above will cripple your business. Want an example of a guarantee with teeth? Here's the guarantee I offer for my coaching program... "Put My Money Where My Mouth Is,
I want you to be absolutely delighted with what you are about to
learn, so here's the deal... If 60 days after you join the Solo Build It Mastery Coaching
Program… after
you’ve read through all of the lessons, watched all of the Camtasia screen
capture videos, and listened to the audios… you know how to build and set up
and monetize Solo Build It websites perfectly … and everything else you'll
learn ... … If at the end of that 2 months, you feel in any way that you
have been misled … or you haven’t learned what you needed to know to get the
absolute best out of Solo Build It … and you don’t think that you could earn
a great living from applying what you’ve learned from this training course, this is what I want you to do: Send me an email just before the end of the first 2 months and say,
“I tell you what Rocky, I’m not really sure this has been a good investment
for me.” And without a single question, your investment will be refunded in
full. I’ll happily buy your Solo Build It Mastery Coaching Course back from
you, and you can keep your access to all of the training materials as my
way of thanking you for giving us a try … plus I’ll give you my sincere
apologies for wasting your time. So your worst case scenario is: You have 2 full months to discover exactly how to become a top Solo Build It website owner and have the opportunity of earning a living online doing
something you’ve dreamed about doing for so long OR you get to keep the
training materials and I’ll send you a full, immediate refund. Is that fair? It truly shows that we are damned serious about
helping you to make it with Solo Build It, doesn’t it? See how this guarantee removes the ALL risk from the buyer and puts it onto me? Anyone who buys this training course can rest assured that if they don't feel that I've over-delivered for any reason, they'll get a full refund. No ifs, no buts. I'll give them their money back if they aren't delighted. If people ask for a refund, I damn well give it to them. Now thankfully it doesn't happen very often, but it's a cost of doing business folks! Factor it into your pricing and get over it! And by giving a hassle-free refund on a product that isn't suitable to that person, I leave the door open in the relationship to continue so that I can offer them something else in the future. I can even upsell or cross-sell them to something else right on the spot... How To Stop 70%
Of Your Refunds Or Ok, you've seen a weasel-our clause guarantee and a great guarantee. Let's now look at how your refunds should be handled. There are three important questions that will turn around nearly all of your potential refunds. Question 1 - What happened? Question 2 - What should have happened? Question 3 - What do I have to do to make this right? In the case of the ebook I mentioned above, here's what should have happened following this formula... Question 1 - What happened? Kim's answer - I felt the ebook wasn't right for me, it's too basic, and I don't think I should have to buy the ebook in order to get access to the Trading Alerts Service. Question 2 - What should have happened? Kim's answer - Well I'd like a refund for starters. Question 2 - What do I have to do to make this right? Kim's answer - Well give me my money back for the ebook and I'll join the trading room for a trial period to see how it goes. Final offer - That sounds fair. What would you say if I gave you a full refund on the ebook since you already know the strategy, and gave you one months complementary access to the Trading Alert Service as my way of saying thanks for giving the ebook a try? Then after the first month, if you want to stay a member and continue to benefit from the trading alerts service, all it will cost you is the $125 a month. If it's not for you, just let me know anytime up to 30 days from now and you won't be billed, ever. How does that sound? See how this sad situation could have been easily turned around? A potential refund could have been turned into a residual income stream of $125 a month - that's $1500 a year! Plus this trading educator offers seminars, high end personal coaching and other training products as well which could have massively increased the lifetime value of this particular customer. Now, let's consider the wider implications of this ebook debacle As many of you know, I love Stock and Option trading, and I'm currently working on a website Joint Venture with a prominent US based trader which is very exciting. Over the next few months and years we will be generating thousands of people to our site every month who are very interested in trading in all it's forms, as well as other private investors, collectors, brokers, dealers and institutional investors. Many of these people won't be candidates for our trading system and methodology, but they will certainly be interested in other facets of trading markets (Stocks, Options, Gold, Collectables, Commodities, etc.) As part of my role as Marketing Partner, I have to screen potential Joint Venture partners who will share in this excess lead flow of people who aren't interested in our trading methodology, but who are interested in learning how to trade these other markets. We'll be setting up JV or affiliate arrangements with these other training providers and either sell the leads to them or share in the revenue each client generates for them. One way I've been doing this is to check out customer service and refund policies. Obviously I don't want our high value clients to have a bad experience when they deal with one of our affiliate partners, so I have to check them out before I approach them. Having heard Kim's story, do you think I'll be approaching this options trader to become one of our preferred partners? I think not... First up, the initial product, his Ebook, isn't up to scratch, so we wouldn't want to recommend a product to our clients that we didn't like anyway. But assuming he fixed that up and we had decided to work with him, how much has this little episode cost him. Well he's saved himself $110 by NOT refunding the ebook for Kim. Now let's say that through our trading Joint Venture, we sent 500 visitors a month to our guru's website. And let's assume that 2% of them buy the ebook and just 1% join his Trading Alert System. That's 10 ebook sales (US$1000) plus 5 members joining the Trading Alerts service (US$625 a month). If these people stay for just 1 year, that's an added US$8500 revenue that he wouldn't have ever had...and that's just for one month. What about over 12 months? That's over 100 Grand in lost revenue because of stupid handling of a refund. And that doesn't even consider the fact that many of these people will buy additional products and services as well over that period of time. Can you see how important it is to respect the people who purchase your products and services? You just never know who's testing you out, or who's lurking on your list, or who's a potential gold mine Joint Venture partner just waiting to be tapped. The lessons?
I sincerely hope this lesson has opened your eyes to the potential of how a simple refund, handled badly, can make a huge dent in your potential long term income. Imagine how many other people this refund policy has ticked off. And how many people these ticked off people have told who will never deal with him either. The 'Butterfly Effect' or flow-on consequences of this short sighted, stupid 'Non-Guarantee' thinking over a hundred and ten dollar product will ultimately cost him millions...
Until next time, Take care,
P.S. And don't forget, if you are struggling with SBI and need some help, I can offer you advanced assistance in building and getting the best performance out of your website. I provide an array of website building, optimization and marketing services (see www.sitebuilditmadeeasy.com/services.htm) and can provide fresh insight and new angles to solving your web marketing problems. Visit that page for a full rundown on how I can help you further with your Solo Build It website
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Too
bad, but that's business. Something to think about...
