Who Sells the Soap?

I attended my first Amway recruitment meeting in 1978. A successful looking young man, and an equally successful looking middle aged woman each did a 20 minute monolog on how much money each of us “up-line” would make from each person we recruited, from the people they recruited, and from the recruits recruited by the recruits of the recruits.

I sat quietly for about three quarters of an hour (and through six charts designed to help me visualize my income increasing geometrically with each additional recruitment level).

Finally, when they offered to answer any questions, I asked “Who sells the soap?”

The presentation we sat through assured us we could make money by recruiting, rather than by selling. But the company exists to sell cleaning products. At some point, someone has to sell soap.

Telling people they can succeed in multi-level marketing without having to sell is an attempt to draw raw numbers of people into the organization, in hopes that some of them might stumble across a sale before they get discouraged and quit. The vast majority of them will never sell anything.


It’s the “stuff against the wall” theory.

It’s very much like the numbers from the early days of e-mail marketing. People spent nearly nothing to blast out 5 million e-mail offers a day, and made pretty good money on the 650 or so who responded. That translates to a conversion rate of 0.0000013%, if you're counting.

More stuff against the wall.

But, let’s not get sidetracked. Today we’re talking about selling the soap.

Ever notice that just about every expert at selling on-line, teaches how to sell “How to sell on the Internet” information?

It’s the 1978 Amway presentation all over again – make your money on recruiting other people who will recruit other people. Don’t worry about moving product. Instead, buy the resale rights to somebody's report, and sell that report to some other fool.


These things appear to work because people so badly want to purchase their dreams.

Everyone wants to own a company that has lots of sales, but no one wants to do the selling. Everyone wants to be 6 levels up-line, but no one wants to talk to shoppers about soap.

Yesterday, while researching a topic for a client, I blew $8 on a report titled What Your Potential Joint Venture Partners Really Want. On the last page it says “Making money with this report is very easy. Simply send people to the sales letter site using this URL . . .”

So, you buy the report. You then have the privilege of selling the same report, while sending your “customers” to the writer, where he fulfills their orders and harvests their e-mail addresses.

(Side note: since I’ve purchased the resale rights, I’ll sell it at my price: $0.00. If you want a copy, drop an e-mail to ChuckMcKay@ChuckMcKayOnLine.com, and I’ll send you the report at no charge. If you feel guilty about not paying for it, make an $8 contribution to your favorite charity).

Information marketers know most of the people who buy information are paying a premium for the dream, and will never apply the info. It’s also common knowledge that people who buy “how to” information buy lots of it. Many spend thousands of dollars on advice that they never apply.

And then there are the gurus who promise the secrets of setting up a web site that "sells for you 24/7," so that you never have to make a sales call while the money comes rolling in. You know what the sad part is? When it doesn't work, the dream purchasers assume they're doing something wrong, and they only need to buy the next big Internet "secret" to have the cash start rolling in.

A public speaker I’ve crossed paths with, frequently makes thousands of extra dollars per talk by selling information products from the back of the room. Suspecting that people weren't applying the information from his course, and wanting to find out, he packaged a six audio CD set, deliberately manufacturing #2 and #5 as blank disks. He told me that out of 300 courses sold, only two people contacted him to complain that #2 was useless. No one called to ask for a replacement for CD#5.

To his credit, he's in the process of changing careers.

People want to buy the dream. They will pay handsomely for it. Especially if they don’t have to sell anything.

Let me wrap this up by reminding you what you’ve known for decades. If it seems too good to be true, it probably is. Now, you have an additional tool to analyze any potential offer.

Figure out who sells the soap.

If it’s not you, it probably is too good to be true.

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Final thought: there are people making money selling through the web. They’re not necessarily getting rich, but they are experiencing positive cash flow. They’re building sustainable on-line business the same way entrepreneurs have been building bricks and mortar businesses for thousands of years: by meeting the needs of one customer at a time.

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Real World Word-of-Mouth

Empowerment. It's what's shifting the balance of information from sellers to buyers.

Just a few years ago the conventional selling wisdom was to brag about the good word-of-mouth, and try to hush the bad. Since the only thing customers tended to have in common was that they purchased from the same seller, they weren't able to tell each other much about their respective experiences.

When the seller told prospective customers the good news of a positive referral, they may have never heard the bad news from other customers.

But technology has changed that balance by connecting, and empowering, the buyers. They're connected through cell phones, through IMs, chats, e-mail groups, blogs, podcasts, and vidcasts. They're sharing information.

They're talking about you. They're doing it right now.

In the past I've stated you are in control of your company's word-of-mouth. I've even explained how to budget for word-of-mouth. And here I am telling you that customers are talking to each other and leaving you out of the process.


Let’s discuss some real world causes of word-of-mouth.

Imagine a customer planning a getaway for a family of four. She's checking prices online, and finds Best Western has a price-match guarantee. She finds a better price at HotelClub.net, books a non-smoking room, and submits a price-match claim.

Best Western rejects the claim because she booked a non-smoking room, and HotelClub.net didn’t guarantee a non-smoking room.

Being the stubborn type, she goes back to HotelClub and books a smoking room. She again submits her claim and is again rejected. This time it’s because although their hotel only offers two double beds for the occupancy of four persons, she didn’t specify that she wouldn’t accept a double and two singles, or even four singles.

Think she might put her story on the web?

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Suppose a customer was excited by the news that as of January 1, 2005 Blockbuster was no longer going to charge late fees on their movie rentals. Further suppose he had rented one, and didn’t return it within a couple of weeks. Would he be upset to find he’d just purchased that movie?

Then, to add insult to injury, the company indignantly states that there ARE no late fees any more, which technically is true. They’re not charging a fee for keeping the disc. Instead, they’ve just sold it to him.

What do you think? Will he sit on this story, or share it with other anonymous prospective buyers?

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Making false promises, and weaseling out of them is so common that savvy shoppers automatically begin by reading the fine print in the offer.

Look at the basic price match guarantee. To qualify for the price match, a shopper should have to compare apples to apples. That's fair, isn't it? In order to match the price, the items sold must be exactly the same, as evidenced by the model number.

Suppose a shopper found the exact same Minolta camera at three different major retail chains. Oh, wait, they’re not exactly the same.

One is marked 430si, one 450si, and one 400si. That model number is literally the only difference. The major retailers (who purchase a lot of Minolta cameras) have successfully negotiated with Minolta to help make sure they'll never have to pay off on any price match guarantee.

Might a disgruntled shopper put that story on the web?

It isn't just Minolta, and this strategy isn't limited to cameras. My brother-in-law found a similar situation with Dyson vaccuum cleaners. No two chains carry exactly the same model. Their respective model numbers differ only by the hyphenated final digit.

While researching this article, I found the Minolta story. Since then, the page has been removed, and yet, you're reading about it here anyway. That's another example of applied word-of-mouth. Another example of the persistance of word-of-mouth.

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A buyer checking out Netmarket’s 200 percent price match guarantee, would have found Netmarket also uses this strategy, (“Exactly the same means an item with the same model number, manufacturer's U.S. warranty and accessories, as the one you bought from Netmarket.”)

But just to make absolutely sure they'll never pay off, Netmarket has added a couple of extra steps.

First, they require you to contact the manufacturer and prove to Netmarket that the company you bought the item from was indeed authorized by the manufacturer to sell that model number at that particular price.

Second, the competitors ad can’t state a “no return” policy, can’t limit the number you’re allowed to purchase, or can’t have an expiration date.

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CampusTech’s price match guarantee states that once you’ve actually placed an order with them, the item no longer qualifies for the guarantee.

Huh?

They’ll price match right up until you actually purchase, then the deal’s off.

Of course, CampusTech maintains a $50 limit on their match and says they won’t sell below cost, no matter what the price guarantee.

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Best Buy's web site offers to let you purchase on-line, and pick up the merchandise at the store, where the price is higher. The Best Buy folks will tell you that their on-line sales happen through a separate entity, who sets prices independantly.

Will upset buyers tell people about this if they felt cheated?

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We could go on discussing individual examples of companies who dishonor their advertising in their fine print, but I'm sure by now you get the idea (and I also hope you start reading that fine print much more closely).

Years ago if a customer was outraged to find himself a victim of this weasel clause strategy, the only people who might hear of his experience were close friends or co-workers. If one of them was in the market for a vaccuum or a camera, he might have affected their purchase decision. Chances are, few of them were in the market at that time.

But now? Now, your customers, although total strangers, are telling each other exactly how you treated them.

My original point was that you control the word-of-mouth related to your business, and you do.

All you have to do is treat your customers honorably.

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Sally and Her Pills

In 1993 I watched from behind the glass as a focus group of young women unanimously agreed about the most useful thing to their morning routine. It was a morning radio disc jockey’s “Color of the Day” feature.

All they had to do was to listen for the color of the day, then choose an outfit of that color. One less decision to be made by busy wives and mothers during the most hectic part of their day.

The ladies perceived local traffic to be a major issue, too, even though none of the men we interviewed shared their opinion (or for that matter found any value in the Color of the Day). Those features would be useless clutter to a radio station trying to attract as listeners the men we interviewed.

But a station attempting to gain the ladies in my story as listeners would be well advised to add morning traffic reports to their Color of the Day.


What’s meaningful to one group of people is frequently meaningless to another.

As marketers we need to understand the people we’re targeting. We need to appreciate the topics they believe to be important, and craft messages which talk about those issues at an emotional level appropriate to the strength of their belief.

We don't care what non-prospects think of our message.

In the focus group example the things the women found valuable, the men thought silly. (Tuck that away for the next time someone wants an ad to reach "everybody"). But when it came to the Color of the Day or a morning traffic report, it didn't matter whether those men reacted at all. They were not the target.

I direct your attention to Roche Pharmaceuticals and GlaxoSmithKline's current television ad for Boniva.

Boniva is the trade name for ibandronatef. It's prescribed as a treatment for osteoporosis in postmenopausal women. Sally Field is their celebrity spokesperson. Since her osteoporosis diagnosis in 2005 she has taken Boniva to build bone mass.


The ad opens on a close-up of Ms. Field.

My girlfriend and I were talking about osteoporosis and she told me she has to set aside time one morning every week to take her osteoporosis pill. I said, “I take once monthly Boniva. It fits my routine.” And she said “That I can do.” Boniva helps build strong, healthy bones to prevent fractures with just one pill a month. With all I do for bone health Boniva fits right in.

Now, despite the derogetory comments of two gentlemen friends of mine, I'm betting that the research indicates post menopausal women find setting aside time to swallow a pill to be a real issue.

My friends opined that worrying about the time required to swallow one pill a week is ridiculous. But then, they still don't really believe the surveys which show women prefer chocolate to sex. And frankly, we don't CARE what they think. Neither of these gentlemen will ever purchase Boniva, or recommend it. To Boniva's marketers, my friends don't even exist.

The ad ends with,

Sally Field: Ask your doctor if Boniva is right for you. My girlfriend is so glad she did.

Announcer: Don’t wait another week. Ask your doctor for a free trial offer or call one eight hundred four Boniva.

In your experience, is pill swallowing, (or more accurately the setting aside of time to swallow pills), an issue for post menopausal women?

Please post your thoughts while I'm gone. I'm stepping out to buy some chocolate stock.

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Should You Insert a Gorilla in Your Ads?

I was recently having lunch with an old friend for the first time in years, catching up on mutual friends, and jobs, and families, when he mentioned how much he and his elder daughter enjoyed a particular cellular phone ad.

He was able to recite a substantial portion of the dialog. He emphatically told me this was the best ad on television.

Out of curiosity, I asked the name of the advertiser.

He couldn’t remember.

Pause with me for just a moment, and let this admission soak in.

He remembered the ad, and couldn’t remember the advertiser.

Ouch.

How many millions of dollars has that advertiser spent to entertain my friend, his daughter, and hundreds of thousands of other people?

And they can't even recall whom to thank.


I submit this is not the best ad on television.

In fact, would not a great ad accomplish exactly the opposite? You’d remember the advertiser, or his product or service, and not have any recollection of where your impressions of that advertiser came from?

Too many times advertisers seem to get it backwards. They want ads that look and sound like… ads. In fact, the more those advertisments look and sound like other ads, the more comfortable the advertiser is with the presentation.

The downside? The more they look and sound like other ads, the easier they are to ignore.

Think back with me a few days into our mutual past. Do you remember any ads catching your attention? Assuming you said, “yes,” did they catch your attention because of the sameness of those ads? Do you remember saying “My goodness… this ad appears to be more like all other ads than any I’ve seen this week. It stands out in my mind because of its ability to blend in with all of the others?”

Or, did it stand out as different, and because of that difference become worthy of attention, and remembrance?


Be careful with that quality of memorability.

Are you remembering the advertiser, or the ad?

Making ads memorable is easy. Insert a gorilla in a jockstrap into your next ad. It will be noticed, and remembered. It may even be talked about. And much like the cellular telephone ad, it won’t sell a dime’s worth of your product.

Can we agree that the purpose of your ads is to communicate to a prospective customer that you have goods and services for sale? Can we agree that our objective is to persuade that prospective customer to come shop with you?

I submit that good ads, persuasive ads, communicate an idea which will be remembered. Once the idea is shared, the vehicle which carried it to the prospective customer is quickly forgotten.

When people are saying, “Hey, that’s a great ad,” chances are it’s not.

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