> the fact Joe is pointing out
> is that if you under-promise and
> over-deliver a great many people will not
> realize how great your product is. Thus they
> won't derive the great things your product
> delivers. They don't buy because your
> marketing is weak. You haven't flagged as
> big an audience as you could have with
> better marketing. In essense you've robbed
> the customer of the joy/benefit/excitement
> of owning your product because they don't
> realize (or realize enough) that your
> product is right for them.

> What the Joe's message is: "Promise
> just as much as you deliver!"

Is this further explained in JS's Work? Because it was not part of the post you asked opinions on.

I alluded to this in my previous post... that JS wasn't here to "clear up" his statement.

Regardless of that, lets run some numbers...

Product: BlueBlockers (just for example)
Retail Price: $150
Cost Price $25
Profit: $125
Total sales: 100,000 units
Total Revenue: 12,500,000
Refunds at 10%: 10,000 units at $125 = 1,250,000

That's JS's "as quoted by you" method.

Refund reducing ploy...
Cost: $1.
Total cost for 100,000 sales = $100,000
Refund rate reduce to 9%.
Refunds thus: 9,000 units at $125 = $1,125,000

Difference: $125,000 less refunded.

Take away $100,000 spent on premium = $25,000

By giving a premium (over delivering) you are $25,000 better off.

IF, each additional premium reduced the refund rate by 1% and cost $1, and refunds could not be reduced below 3%, then this example would have you spend the following:

Premiums $7
Refund rate 3% (3,000 units)
Total refunded $375,000
Total spent on refund reducing: $700,000
Total out: $1,075,000
Better off by: $175,000

Of course, these numbers are made up and IF numbers.

It assumes the product would always get a 10% refund rate no matter what type of marketing, without a premium. It assumes each premium costs $1 and reduces the refund rate by 1%, and that there is a $125 profit per sale. With no "restocking" expense. And so on.

The point is, by reducing your refund rate, you stay in front... get to keep more money.

But you gotta do the math first - as it applies to your business.

For JS to make a blanket statement is shoddy.

> Michael, after spending the last 20+ years
> marketing a wide variety of products and
> businesses I can tell that most businesses
> suffer from under-promising and
> over-delivering rather than the other way
> around and that's why they aren't as
> profitable as they should be. The companies
> that do it the other way (the illegal,
> non-ethical way) aren't in business very
> long. I think Joe's longevity speaks
> volumes.

My Biggest question is about Customer Satisfaction. JS may have sold many many items over many many years. How Many of those items were to previous customers though?

Also, the bit you quoted from JS was comparing an electronic product with an info product, right?

Maybe the pocket calculator vs a niche-market audio tape set?

Can such items even be compared in the first place?

How many items has JS sold to the same market? As in, sold along a theme as an info-product creator might do.

In other words... was JS after repeat sales or one off sales on the front end.

There are a lot of questions to be answered. And knowing the answers might give an insight into why JS would suggest a 10% refund rate.

Again, without JS here to "clear things up" (or me having a copy of his Work in front of me to get clarification myself) we can only comment on the small bits presented and asked for comment.

Michael Ross


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