SALES Techniques - How To Convince A Customer To Buy From You

Summary

The video script introduces 'The 3 Boxes' sales technique, advocating for offering customers three distinct product or service options to influence their purchasing decisions. By presenting a low, medium, and high-tier choice, customers are drawn to the middle option, which is strategically designed to be the most compelling. This approach, known as contrast pricing, uses the high-end option as a decoy to make the middle choice seem more attractive, while the low-end serves to anchor the value of the middle option. The technique aims to guide customers towards the seller's desired sale while making them feel they are making an independent choice.

Takeaways

• 💡 The '3 Boxes' strategy is a sales technique that encourages customers to make a purchase by offering them multiple choices.
• 🔑 When customers are given only one option, they tend to focus on whether to buy or not, which often leads to a focus on price.
• 📈 Providing two choices shifts the customer's focus from 'whether to buy' to 'which one to buy', with most opting for the smaller or safer option.
• 🍿 The example of movie theater popcorn sizes illustrates how introducing a third, larger size can influence customers to choose the middle-sized option.
• 💼 The strategy suggests offering a small, unappealing option, a middle option that is compelling, and a large, high-priced option that acts as a decoy.
• 💰 The middle option should be the most attractive, offering the best value and features, aiming to be the primary choice for customers.
• 📊 Contrast pricing is used to make the middle option more appealing by comparison to the other two less desirable options.
• 🚫 Offering too many choices, such as four, can lead to confusion and may reduce the effectiveness of the strategy.
• 💭 The goal is to make customers feel they are making a choice, even though the options are designed to guide them towards the middle option.
• 🌟 The technique is about creating a perception of value and choice, rather than simply focusing on price or features alone.

Q & A

What is the main sales technique discussed in the script?

The main sales technique discussed is 'The 3 Boxes' strategy, which involves offering customers a choice between three different options for a product or service.

How does the 'The 3 Boxes' strategy influence customer decision-making?

The 'The 3 Boxes' strategy shifts the customer's focus from whether to buy to which option to choose, creating a perception of choice and control over their decision.

Why is it suggested to offer three options instead of just two?

Offering three options introduces a 'contrast pricing' effect, where the middle option becomes more compelling due to the presence of a lower and a higher-priced option.

What is the psychological impact of providing a 'jumbo' option in the 3 Boxes strategy?

The 'jumbo' option serves as a decoy, making the middle option seem more reasonable and attractive by comparison, even though it's not expected to be the primary seller.

How does the script suggest businesses price their offerings using the 3 Boxes strategy?

Businesses should price their offerings with a low, middle, and high tier, where the middle tier is the most compelling and is the one they actually want to sell.

What role does the 'small' option play in the 3 Boxes strategy?

The 'small' option acts as an anchor, making the middle option seem like a better value and encouraging customers to avoid the cheapest option.

Why is it not recommended to offer more than three choices according to the script?

Offering more than three choices can lead to decision paralysis and confusion for the customer, reducing the effectiveness of the strategy.

Can you provide an example from the script where the 3 Boxes strategy is used?

An example given is a car wash service offering three options: a basic exterior wash, a mid-tier wash with additional interior cleaning, and a premium detailing service.

How does the script suggest businesses structure the features and benefits of their offerings in the 3 Boxes strategy?

The script suggests that businesses should offer fewer features and benefits in the lowest tier and more in the middle tier, making the middle option the most attractive.

What is the purpose of the 'decoy' option in the 3 Boxes strategy?

The 'decoy' option is designed to make the other options, particularly the middle one, seem more appealing by comparison, even though it's not expected to be a major seller.

How does the script define 'contrast pricing' in the context of the 3 Boxes strategy?

Contrast pricing is the strategy of setting up the pricing of different options in such a way that they influence each other, making the middle option seem like the best value.

Outlines

00:00

💡 The Power of Three Choices in Sales

The narrator introduces a sales technique called 'The 3 Boxes', which involves offering customers three distinct choices for a product or service. The concept is based on the idea that providing a single choice leads to a binary decision (to buy or not to buy), focusing the customer on price. However, when two options are presented, customers tend to choose based on value rather than necessity, often opting for the safer, cheaper option. The introduction of a third, more expensive option creates a contrast that makes the middle option more appealing. This strategy is exemplified by movie theater popcorn sizes, where the 'regular' size often becomes the most popular choice due to the presence of a 'small' and a 'jumbo' size. The technique is about guiding customers to make a purchase by presenting them with a compelling middle option, while using the other choices as decoys.

05:01

🔑 Implementing the Three Boxes Strategy

The second paragraph delves into the practical application of the 'The 3 Boxes' strategy. It suggests using terms like 'silver', 'gold', and 'platinum' to denote different levels of service or product offerings. The 'platinum' or top-tier option should be luxurious and expensive, not necessarily intended for the majority of customers but to attract a segment willing to pay a premium. Conversely, the 'silver' or basic option is designed to be less attractive, pushing customers towards the 'gold' or middle option, which offers the best value and is the primary focus for sales. The strategy is about creating a perceived value hierarchy that nudges customers towards the middle option, which is the most profitable for the seller. The concept of 'contrast pricing' is highlighted, where the extreme options serve as decoys to make the middle option seem more attractive.

Keywords

💡3 Boxes Strategy

The '3 Boxes Strategy' is a sales technique involving the creation of three pricing tiers for a product or service, typically a small, a medium, and a large option. This concept is central to the video's message, as it demonstrates how offering three options can shift the customer's focus from 'whether to buy' to 'which one to buy.' The strategy encourages consumers to opt for the middle option, making it the most attractive by offering a balance of value and price.

💡Contrast Pricing

Contrast pricing refers to the technique of creating a significant difference between pricing options to highlight the perceived value of the middle option. In the script, this is demonstrated with movie theater sodas, where the smallest option seems too basic, and the largest too expensive, leaving the middle as the most logical choice. This drives customers to see the middle option as the best value.

💡Decoy

A decoy is a pricing option that is not intended to sell but rather to influence the buyer's decision by comparison. In the video, the decoy is the large or premium option, which is priced so high that it makes the middle option seem more reasonable and valuable in contrast. The decoy helps manipulate customer perception and guide them toward the desired purchase.

💡Customer Choices

The concept of 'customer choices' is a fundamental theme of the video, emphasizing that sales and marketing are about presenting customers with the right number of choices. Too few choices limit options, and too many can overwhelm. By giving customers three choices, businesses can help guide them toward a desired decision while making them feel in control.

💡Small, Medium, Large

These terms refer to the three-tiered options presented to customers in the '3 Boxes Strategy.' The 'small' is a basic, inexpensive offer, the 'medium' is the most attractive and valuable, and the 'large' is an extravagant option meant to act as a decoy. The script uses the example of movie theater sodas to show how people often gravitate toward the middle, or 'medium,' choice.

💡Perceived Value

Perceived value is the customer's interpretation of the worth or quality of a product relative to its price. In the video, the middle option in the '3 Boxes Strategy' is designed to have a higher perceived value because it offers more benefits than the small option at a reasonable price, while still appearing cheaper than the large option.

💡Upselling

Upselling is the technique of encouraging customers to purchase a more expensive product or add-on by presenting it as a better value. In the video, this concept is applied when discussing car wash packages, where customers are led to opt for the mid-tier package because it offers more features than the basic package for only a slightly higher price.

💡Consumer Psychology

Consumer psychology refers to understanding how and why customers make purchasing decisions. The video highlights how consumers are influenced by the number of choices they are given and how pricing contrasts can guide their decision-making process. By manipulating the offer structure, businesses can steer customers toward the desired option.

💡Luxury Option

The luxury option is the most expensive, premium offering in the '3 Boxes Strategy.' While most customers won't choose it, it serves as a reference point to make the middle option seem more appealing. This option caters to a small percentage of customers who desire the best of the best, providing a high-profit margin for the business.

💡Middle Offer

The middle offer is the centerpiece of the '3 Boxes Strategy,' designed to be the most compelling choice. In the video, this option is intended to be more valuable than the smallest option, while appearing significantly more reasonable than the large, luxury option. The middle offer drives the majority of sales and is the choice businesses strategically position as the best value.

Highlights

The strategy of using three pricing options to increase customer sales by offering a small, medium, and large option.

Introducing contrast pricing: making the middle option the most compelling while presenting an outrageous high-end option and a weak low-end option.

Customers tend to choose the middle option when presented with three choices, as it feels like a safer, more reasonable purchase.

The highest tier product serves as a decoy, designed to make the middle option look more attractive and valuable.

When given two options, 80% of customers choose the smaller one; introducing a third option shifts the focus to ‘which to buy’ instead of ‘whether to buy.’

Movie theaters implemented this strategy with soda sizes, turning the old large into a regular and introducing a jumbo size.

The 3-box strategy can be applied in various industries, such as car washes, where different service levels are offered.

Making the small offer 'wimpy' or less valuable encourages customers to gravitate toward the middle offer.

The ultimate goal is to have 60-80% of customers choose the middle-tier option, which offers the best balance of value and price.

For luxury customers, even if 5-20% choose the high-end offer, it can significantly boost profit margins.

Giving customers three choices makes them feel empowered in their decision-making process.

Three choices are ideal; offering more than three creates confusion, leading to indecision.

This strategy is not about manipulating sales scripts but about tweaking the offer itself to guide customer behavior.

The decoy pricing method is not about selling the high-end option but using it to make the middle option seem more reasonable and attractive.

This pricing technique works across different businesses and is not limited to specific products or services.

Transcripts

- [Narrator] Would you like to convince more of your

customers to buy more from you, more often?

Today, I'm going to teach you a simple

but powerful sales technique that's been

proven to work in my various companies.

It is very simple, something that you can apply today.

It has nothing to do with gimmicks.

It has nothing to do with your sales script.

It has to do with your offer.

What are some simple things that you can tweak

within your offer that you can convince

your customers to buy more from you,

and that strategy is called The 3 Boxes.

Now want you to think about this.

When you are selling your product or service

that you have one choice, you have one option.

When someone looks at your offer, all they could think,

all the consumers can think is,

do I want to buy this or do I not want to buy this?

So it is a yes or no response.

So now they're thinking, okay, can I afford this?

Do I have the budget for this?

They are focusing on price.

Now, however, if you give them two

choices such as like an A and a B like this.

I want you to think back.

Remember when you go to movie theaters long time ago, right?

They give you two choices.

They have the large pop and then they have the small pop.

When you want to buy a soda, two choices.

And what most people do is when you give them two choices,

80% go for the small and 20% go for the large.

Why, because most people like to play safe,

and they like to pick the ones that

they could save money on, so it's A and B, good.

Now when you get that A and B,

these two choices, the consumer, your customer,

they're not so focusing on,

okay, do I want to buy this or do I not want to buy it?

They're thinking, which one do I want to buy?

But then later on the movie theater,

they introduce a third choice,

which is this, right?

That's the three boxes and here's how the strategy works.

Suddenly they have the small soda,

they have the regular, which used to be the old large,

which now they call it the regular.

Cause large feels like, oh, it's too much.

Oh, regular, that makes sense.

They just changed the name, it used to be large.

Regular, and then they have what the jumbo size pop.

That's like this big, right,

that you can never ever finish, even with your kids.

So you had the three choices and here's how it works.

They offered you the small.

They offered something in the middle.

They give you something that's like jumbo size.

So when you do this, suddenly there's a,

what I call, contrast pricing.

So what you do is this.

When you offer your product and services,

you want to make your, the biggest offer,

the ultimate super duper offer, that is so outrageous,

that knowing most people would not go for this.

Knowing that, and then you wanna make

your small offer like so wimpy, right?

You wanna make it so like, nah, average.

You don't like it that much.

But you wanna make the middle one very, very compelling.

Knowing you actually want people to buy this one.

That's the one you want to buy.

So what happens is the movie theater,

they introduce this concept,

20% who really, really like soda.

They go for the big jumbo, 20% right?

And then you have 60% go for the middle,

and then you have 20% that go for the small.

And then later on they actually introduce

their kind of the kid size.

Now, what I believe when you are making an offer,

two choices, it's good.

Three choices are the best.

Now when you offer them four choices,

I believe it's a little bit too much.

It's a little bit too confusing.

But when you give them this and you'll make the middle one,

this is the one you want to sell,

you make this as compelling as possible.

Let me give you another example.

I want you to think about, you are taking your

car to a car wash.

They use this technique where you have,

they will like kind of shampoo the exterior of your car.

Let's say for $15, that's it,

like a simple shampoo, that's it.

Or if you want a shampoo outside of your car

and they add some new chemical, whatever, right?

Add some new shine, and also

they will vacuum your interior for $25.

So you're thinking, well, 15 bucks,

well, for 10 bucks more, I can you know,

also you know, my car interiors a little bit dirty.

Okay, I'll take that.

And then they have the super detailing, wax, like 200 bucks.

You're like, oh, I'm not gonna go for the 200 bucks.

That's just too crazy, but I'm not going to be a cheap ass.

I'm gonna go for one in the middle.

That's the one they want to sell you.

So you can easily do this for your business.

So I want you to create three boxes.

The small one, very, very small, they're wimpy.

You can even think about silver, gold, platinum.

You've heard of those terms before.

Silver, gold, platinum for some kind of membership.

They do that too, wow.

And this, I want it, I want you to make

it as expensive, as luxurious as possible for the big one.

Knowing most people will not go for this,

but here's what's very interesting.

At any given time, five, ten,

even as much as 20% of your marketplace,

they will want the best, right?

Give me the biggest, best thing that you have.

That's good, huge profit margin.

But knowing you're not counting this to sell, right?

This one you're like, this is really for the cheap customer.

You want the majority, 60%, 80% to buy this one.

So what you can do is, let's say the list

of features and benefits.

Let's say this offer, you have 10 things, okay.

This, you might have it like two things.

But this, you give it seven things.

This gets the most value when customer buys this,

and you offer them the one in the middle.

This is called contrast pricing.

This is a decoy.

You're not counting to sell this, it's simply a decoy.

There you go, that's the strategy of three boxes.

Very simple.

You see, selling is about choice,

marketing is about giving your customer choices.

Not too many, not too little,

just the right amount, and let them believe

that it is their choice to make that purchase

and make that buying decision.