This is kinda embarrassing, but…About a year ago I hired a moving company to move my property from New Jersey to Denver. They quoted me a price based on the weight of my belongings. Seemed reasonable enough until I discovered that not only do they not deliver the stuff themselves, but the freight company they hire charges them by the amount of space in the truck it uses, and the weight is irrelevant. Want to know the price difference? The freight company earned $650 for moving my belongings. The moving company we hired pulled in $2900 on top of that. How do I know? Simple, they took a deposit upfront from me, and had me pay cash to the delivery driver, and than charged my credit card for more money. The truth is I got into a big dispute with the company over the actual weight of my stuff, and because of that I asked the freight driver how much it costs to actually move my stuff and he said, “Well, the $650 cash that you paid me, thats all we get.”
The moving industry is notorious for ripping people off. There are a few other industries with equally bad reputations. Used car salesmen and Mechanics are notorious for taking advantage of your ignorance.
Want an easy way to make money? Tell consumers the truth about how you really make money and watch them flock to you. I don’t mind if you make a buck off of me. I do mind if you charge me a 500% markup.
It’s 2014. The internet has been around for over two decades now. We have access to the worlds information at our fingertips…yet, somehow these predatory businesses manage to keep on cashing in on our ignorance.
If you asked most of these entrepreneurs why they keep their real costs and margins a secret from consumers, most will say they are afraid. Afraid you will no longer pay them the money they make today.
I say… If your only competitive advantage is that you know more about buying services in your industry than I do…than you shouldn’t be in business in the first place.
Every single industry that thrives on lack of information should and could be easily disrupted by transparency, or a young ambitious employee blowing the whistle and starting a business that cares about doing a better job.
You don’t need the best prices or the biggest margins to build a dominant business. You need customers who trust you and love you and evangelize you. Want a quick shortcut to win their hearts and minds?
MAKE AN EMBARRASSING CONFESSION.
Open up about all the things your industry is afraid of their consumers finding out. See if you actually lose any business or if you win fair and square.
Last week on Reddit it was revealed that Beats By Dr. Dre headphones only cost about $14 dollars to make, but sell for upwards of $100. Sure, there are massive branding and advertising costs driving that number up… Regardless, that embarrassing truth empowers consumers, but doesn’t somehow kill demand. If anything it makes you appreciate the branding expense more.
I am ok with you making a profit. Even a very hefty one… but if you want me to love your brand…be open and honest and I will still come around and buy from you.
Want to Win Customers? Ask yourself, “what is my industry trying to hide. What am I too afraid to admit to my customers?”
That’s your shortcut to beating out your competitors… cuz, when everyone else is lying, the guy who tells the truth is King.
About David Melamed
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This is so true to me, in the world of any kind of marketing. I’m an avid blog reader and my favourite posts from the ones that I keep up with are where the author makes an embarrassing confession. “What is my industry trying to hide? What am I too afraid to admit to my customers?” These are great questions because in truth, you shouldn’t be too afraid to admit anything to your customers and the sharing of something that makes you blush and portrays you awkwardly I find is the best way to humanize you in the internet. Personally, it allows me to remember that the people behind these posts and products are actually human beings and warms me up to both them and their service by making a connection, even if it is one as simple as us all having awkward moments. It ignites discussion and laughter, and that’s a great thing when you’re trying to market something.
The problem is getting the courage to do it, but I believe it will always be worth it in the end. Again, as I said, those types of posts are always my favourite and win me over. They’re often the first posts on blogs that I happen to find when looking for new material.
I agree with this one hundred percent. I try to think of it this way. When a friend does something silly and they start blushing and apologizing about whatever it was that happened (presumably having caused them a ridiculous degree of embarrassment), often what people do is say something along the lines of, “Oh don’t worry. I don’t that all the time. This one time…” And when they tell their confession that shows them in the same light as their friend, tensions are eased and both parties can laugh about something mutual. It’s the same with customers, allowing everyone to make a connection with each other over something that otherwise wouldn’t have been there, and laughter is always the best tool for that.