EPISODE 205
From $2.5 to $8 Million: a Proven Conversion Formula
with Michael Barbarita
What makes a compelling offer? According to Michael Barbarita, there are five essential elements that play a role in conversion.
Michael is the founder and CEO of Next Step CFO, providing fractional CFO services to small businesses. Michael has owned and operated retail, service, and manufacturing companies for over 30 years. One of his companies, Ski Town USA, grew from $2.5 Million to $8 million in less than 5 years. His product, Cookies To Scoop Frozen Cookie Dough was featured on the QVC Home Shopping Network and was one of the top 20 products in the State of Massachusetts in 1997.
The Conversion Formula
Michael takes all his clients through a four-step process to conversion. The first step is Captivate: get the customer’s attention by speaking to their problems and pain points. The second phase is Fascinate, where you present your unique solution to that problem. The combination of these two elements creates market dominance. Without either one, the rest of the formula falls apart.
The third component is Educate. Now that you have the customer’s attention, you can educate them on how to solve that problem. The final phase is the Close, which needs to be a compelling offer. Once you get this messaging formula right, you can use it on any marketing platform you choose.
5 Elements of Compelling Offer
There are five components to a compelling offer. The first is scarcity or urgency, something that compelled the customer to take action due a deadline or limited quantity.
The second component is risk reversal, where the business takes on most or all of the risk associated with the purchase. For example, in the ski industry, customers never know if their skis are truly the right fit until they’re out on the mountain. So in Michael’s business, he implemented “the ski guarantee” where customers were allowed to try out their new skis up to three times risk-free. Out of the 11,000 pairs of skis they sold that year, only 14 customers returned them.
The third element of a compelling offer is adding more value to your product or service. The fourth is to package or bundle multiple products together, which gives the impression of a discount. The fifth and final element is to be indifferent to the outcome. Go into every sales conversation with the customer’s best interest in mind and you’ll see your conversions increase.
Enjoy this episode with Michael Barbarita…
Soundbytes
10:18-10:33
“We’re all afraid of increasing our prices. But if we market it right and show value, and/or either market it right or show value or market it right and show value, we can charge anything.”
20:58-21:33
“If you sound like a used car salesperson, or if you look like you’re pressing in any way, shape or form, to make a sale, the customer has this feeling that you’re out for yourself and not for them. So you’ve got to present your selling, your sales presentations and so forth…you’ve got to be very detached from the outcome. And it’s hard. It’s hard to do, by the way, but you have to be detached from the outcome so that you can make that sale and the customer knows you have their best interests in mind.”
Quotes
“We always implemented business and financial strategies that the competition wasn’t doing.”
“Once you fail, you gotta get back on your feet quick. Otherwise, you’re gonna stay down.”
“Only 1-3% of any of buyers in any market, in any industry, at any moment is ready to buy now. The other 97-99% are on this journey, and that journey can last anywhere from 15 seconds to 15 years.”
Links mentioned in this episode:
Connect with our Guest
Website: http://www.nextstepcfo.net
Connect with Michael on LinkedIn: https://www.linkedin.com/in/michaelbarbarita/
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