It may sound odd, but the bonus is often the tipping point for a client to buy your product or service.
And yet, by the time we are done with creating the product or service, we are too tired to work out what the bonus should be.
In this episode we look at two methods.
—One is a more traditional method called “bundling“, well the other is quite unexpected and requires very little work.
—A method called “Unbundling“.
Let’s find out how we can use both of these methods, or just one, to create bonuses that are extremely yummy.
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Re-release: Effective Sales Tactics: How To Create Bonuses For Your Products Or Services
Original: Effective Sales Tactics: How To Create Bonuses For Your Products Or Services
Note: (This is an unedited transcript)
I'm going to tell you is a story about a two liter bottle of coke and six one tons.
When we moved to New Zealand in the year 2000, we lived in this suburb called Berkdale. and just about five minutes away from our house. Whether he's a bunch of shops, and one of them was a Chinese takeaway. The portions were large, so we were ordered one dish, maybe two sometimes, and that was it.
However, one day, something changed, and I forget the details, but we ordered about $30 worth of food. And as it was about to take away the food, I got a two-litre bottle of coke and six-one tons.
Now immediately, I was confused because I hadn't ordered any of that, and I thought that she had added it to the bill, but she said no, when you ordered $30 worth of food, you get a two litre bottle of coke and six one tons.
Even if you've heard this story from me before, I know you're smiling because I'm smiling. And the reason we're both smiling is we know exactly what is happening here.
We know that it is very hard to go back to that $25 bill, $26 bill, $27 bill, $29 bill, we know we have to hit that 30 mark. Yes, for me, it was hidden surprise because I didn't realize that I just had to hit that $30 mark to get those six one tons.
We didn't really care about the Coke anyway, but every time I would go to the Chinese takeaway, Renuka would go, “Hey, don't forget to get the one tons.” You're seeing the point of the story on you. You could go out there at $20 with the food and then buy the one done separately or you could create all of these different combinations and you would not have to hit $30.
But once you know that you have that bonus, that free thing, you'll brainconn, focus anymore. And this doesn't just apply to some one-tons, half a dozen one-tons, it applies across the board.
It applies to courses that cost $5,000. It applies to booking a hotel room. It applies to pretty much anything you can think of. And that's because we have somehow hardwired to get that bonus that extra little bit that we didn't pay for.
Even when we know that it's very clear, it's very overt, it's very out there in the open. We know what's happening and yet we can't help ourselves. In real life, we run into bonuses all the time.
The question is, when we are selling a course, when we are selling a product, when we are selling an info product, when we are doing anything, how do we create these bonuses? Or better still, do we have to create the bonuses?
How we suppose to conjure a bonuses from absolutely nothing?
That's what we'll cover in this series, and I say series because maybe this podcast is too long and we have to break it up into two or three pots. But essentially, the three parts we're going to cover are bundling, unbundling and special access. However, let's start out with why a bonus is so crucial, and here's a very quick test.
Let's say you're going to buy a computer, and there are two identical computers.
Once the left-hand side computer, the other is the right-hand side. Same price, same color, same dimensions, identical. Which is to say that if you would swap them over, you wouldn't know the difference.
Now, the left-hand side computer, which we'll go to computer A, you get nothing with it. You just get the computer, you pay for it, you get the computer. the right-hand side computer, which we call computer B, you get a box of chocolates, which computer do you want? It doesn't make sense. I know.
You buying a $3,000 computer. One is just offering you a box of chocolates, which is probably worth $10. Logically, you should go, they're identical. I'm not here for the chocolates. I don't even eat chocolate. And even when all All of that logic kicks in. You still are going to go.
Let me go for computer B. If there is no downside to computer B, there is no catch or anything weird, you're going to walk out with your computer that's computer B and the box of chocolates. And that in a nutshell, and this very quick test, is the psychology of bonuses.
That when faced with a choice, we will always take something that is to our advantage, enough we're not going to use it. And this concept applies across the board. You're selling pizza A and pizza B. Pizza B has some fries with it.
You go with fries. You're selling how's A and how's B. And as you'd expect, anything that has an advantage, you're going to pick that, whether you use it, you don't use it, you give it away, you don't care. You're just thinking of the advantage that you're going to get. and that drives your decision making.
Which is to say that every time we're buying a product, we are going to do this comparison.
And you, as someone that's gonna sell a product, of course, a service, well, you have to have this bonus because it's going to make a world of a difference. But just imagine I went to the bakery down the road and I bought a loaf of bread.
Should they give me a bonus with that loaf of bread? And then maybe I buy another type of bread, should they give me a bonus with that type of read. It's not like every product or service qualifies to have a bonus.
Even so, if you're a cafe and you're selling multiple cups of coffee and you don't have bonuses, well, some part of your business will qualify for bonuses. The problem is that we haven't stopped to consider the power of the bonuses and how to apply them to segments of our business.
And therefore we inadvertently send clients a competition or we don't get them to buy enough from our own business. So having the bonus is crucial and some part of your business will have that bonus capability.
Let's find out how we can use bundling because that's where we start.
we bundle something so that we can be just like that Chinese lady and say you buy $30 worth of stuff and you get two liters of coke and six one towns absolutely free.
Do you remember being told as a child that if you eat carrots your eyesight will improve? There's no doubt the carrots are good for you. They have fiber and that keeps your blood sugar in control. They are loaded with Vitamin A and BTA Carotine, the help you get calcium in your system and something called Vitamin K.
But I cite, where did I come from?
In 1942 in England there was a surplus of over 10,000 tons of carrots. How do they make sure that people eat carrots? They reinforce the belief that carrots help you see better in the dark.
It was the middle of the Second World War and Pilots, R.A.F. Pilots said that they had better night vision, and this was due to greater carrot consumption. The reality is that they had just introduced secret A-Boon, Raida, and that enabled them to see better in the dark.
But the propaganda of the carrots continued, and then you had carrot flan, you had carrot jam, carrot fudge, and if you wondering what is the point of all the story about carrots, well, it gave an additional bonus.
So you could eat other vegetables and they were nice, they did all this calcium and vitamins and all this stuff, but if you are carrots, you got better eyesight. It wasn't true and it isn't true that it improves your eyesight, but it gave that little bonus.
And that is what increased consumption and that is what increases sales in your own business. When a client has to choose between A and B, they choose B simply because it has a bonus.
Now when you have a business, you're going to have a product or you're going to have a service and the way we work with bundling is we take the product and then we can give a bonus as a service.
So let's take an example.
Let's say you have software and that is a product and then you go okay we will come and install the software for you.
So now what you've done is A is just the product which is software B is the product but we will install the software as a bonus and then you put a price on their bonus and automatically the client goes yep that sounds like a better deal for me.
You can have a product in service or you can have a product in a product. So when you go to the psychotactic site, maybe you go to the article writing course, and then you get another product, maybe a smaller product, that enables you to write better headlines.
Well, that is a product and a product. And yes, it's an information product, but it could also be something like buying a computer without a warranty and buying a computer with a warranty.
What is the bonus?
The bonus is the warranty, of course. In your business, you're going to have products or you're going to have services. And you can have the bonus as a service, or you can have a bonus as another product.
But almost immediately we can see the downside of bundling. And that is, we have to go out there and we have to find something. Some add on, that probably costs us time. It definitely costs us money. It costs some amount of energy to get all of that stuff together.
And yet it doesn't have to be a logical add on.
You could sell Venetian blinds and give away chocolate. You could sell Venetian blinds and give away half a dozen coffees. Or you can sell Venetian blinds and give away a complimentary cleaning service after a year or so. The last one is connected to Venetian blinds itself, but the other ones are random.
And so when you're selling something substantial or even semi-substantial, the first thing you want to think of is, “How do I get the client to buy my product, my service instead of somebody else?”
And this is what we do at Psychotactics almost all the time. If you come to a course, you'll see that there is a bonus. So you get a regular and a premium offering. If you buy any workshop or training or product or anything, there is always a regular and a premium.
What's in the premium?
It's the bonus. Who takes that bonus? Almost everybody. And when I say almost everybody, we're looking at a strike rate of around 98 to 99% . Having an add-on automatically gets us to go, I want those six more tons, and therefore we go and we buy the product.
But as we mentioned earlier, this is a real headache, and it used to be a big headache for us. Every time I'd start a course or write a book and then you're so tied at the end of it.
And you still have to write a sales letter.
You still have to do the marketing campaign to make sure that the product sells. And on top of it, you now have to create a bonus or get a bonus or get someone to give you a bonus that you can give away.
Well, that's a problem. And so the second method which is unbundling is the system that works beautifully. Let's find out how that is done.
One of my favorite activities on weekends is to eat a whole bunch of salted pistachios.
I will put them in kind of a deep container and then I will get to them one by one. Now as I get to the nut itself, I throw the shells in that same container, which means after while you can just see a whole bunch of shells, it becomes like a treasure hunt.
You just find one pistachio after a lot of searching and then you're so excited. And the point is, it was always there. But when you find it, you think, wow, that's so cool. It's a treasure.
This is a kind of treasure that we have when we have a service or a product. We don't need to create a new product or a new service to have a bonus. All we have to do is a bit of unbundling.
So what's unbundling?
Whether we sell a product or a service, most of us will be delivering a lot more than we promised our clients. In a nutshell, unbundling simply the action of taking your service or your product about and then reassembling it.
I have a friend for instance who talks about an email course and he has one, two, three, four, twenty different things that he covers in that course. Do the clients need all the twenty bits, of course they do.
But what if you took part seven and you made that a bonus? What if you took part nine and you made that a bonus? You can create bonuses from your existing product.
You can create bonuses from your existing service.
Let's say you sell sofas and with every sofas you tend to go away the following is part of the product of the service offering. So you have color or decor advice. You have the sofas itself. You have Scotch-Cot Protection.
You have maintenance advice. You have access to related discounted services. You may spend a good half an hour to an hour giving color advice or decor advice.
The customer doesn't have any value for this because you haven't put any value on it unless of course that advice is unbundled and then valued at $200. Now suddenly that advice has value, it has a price on it.
The Scotchard protection that's also part of your package. Suddenly that has another $200 value. The maintenance advice booklet or website That's also valuable. Maybe it's less valuable. Maybe it's like $55.
And then you have savings on other services like lamps and side tables And maybe the client can save another $500. So what we've done here is we're not trying to go.
Okay We're gonna take a pot all of this stuff and we're just gonna offer it as a bonus. No, that's nonsense What you're looking at is Your service or your product has X number of moving paths. Let's call them.
And you're going to take number 7 and make it a bonus. Or number 9 and make it a bonus. Or number 7 plus number 9. That's it. Out of those 20 paths, take a couple or take one, assign a value to it, and now we have unbundled. And you may say, that's all very fine for products, but what if you're in the services business?
What if you offer a service like copywriting for instance?
So here's what many copywriters offer their clients and they do so without asking. They have an initial discussion, they have copywriting, they have pricing advice. They may even have a 30-day phone support.
Now, when you take their entire list and you bunch it together, the client just sees it as part of the Copywriting service. The client is not able to assign value in its up to you to break the service, take it apart, then assign the value, and then make one part, or two parts of bonus.
That way, that same service gets played up into discussion, part one, Copywriting part two, And the rest of it can be split up into bonuses. You have to decide how you're going to price it.
You have to decide how you're going to split the bonuses. And you don't have to go overboard. A lot of people will put 20 bonuses and 15 bonuses. And when we started out that's kind of what we were doing not 15 and 20, but three, four, five bonuses.
And then we found that one good bonus is good enough. And when you say, one good bonus, what is that one good bonus? Well, anything that is crucial, number seven, number five, number five, and literally you go and you pick something. And when I say something, I mean anything.
All of the components in your course, in your service, are crucial. Take one out and there you have a bonus. But you have to put a value to it. Otherwise, nobody knows why. It's important.
And I can't tell you what a life saver and time saver energy save of this has been for us. It was always so draining and is draining when you have to go out there and create something right at the end. So unbundling just became this amazing thing.
The reality is that any course, any book, any product is already kind of too much information or too many services. It is. It just is sit down and break apart whatever product service you have and look at the components and then decide okay this one component is going to be the bonus.
The only question that remains is how do you make that bonus valuable and the way that we make the bonus valuable is we put it in its own box on the sales page and we talk about it.
We give it like a paragraph, maybe two paragraphs, you put a graphic there, you put a value there, suddenly you're putting a spotlight on something that people would have just ignored, just taken as part of the package.
So unbundling is really the way to go. Whatever we covered so far, well we've done bundling where we've taken something which is add on and put it to our product service then we looked it on bundling where we already have the stuff what we're just taking it apart and putting it together.
There is a third way to create bonuses and that is called Special Access and we'll cover that in the next episode.
Let's do a summary now.
I think we've already done a summary, haven't we? So what's the one thing that you can do today? I think the best thing you can do today is look at your product or look at your services and then list the component parts of it.
What you will find is it's quite easy to just take one of those parts, put it in a separate section, give it its own little space, its own spotlight and now you've created a really good bonus. It doesn't take very long to do this, but it makes a massive difference to how the clients see your product or service.
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