Experience Sales Improvements Today with a Guarantee


Let’s face it - 8 out of 10 potential customers who visit any business are skeptical to some degree of another. Some of those people are quite open to you but have a slight nagging doubt. They wonder whether your product or service will live up to their expectations. Others are pure, dyed-in-the-wool cynics and they are skeptical about everything to do with your business.

And when you think about it, why shouldn’t they be skeptical? After all, they’re about to take a risk by buying from you. They are about to exchange their hard-earned cash for your product or service, so obviously they’re a little nervous about  that.

Regardless of the type of business you have, the type of product or service you sell, the size of your business, or where you’re located, your customers all have similar objections or fears when making that purchasing decision.

They wonder:

  • Will the product work?
  • Is your company above-board?
  • Will the product do what it says it will do within an acceptable time frame?
  • Do your people have the right kind of experience to deliver?
  • Does your company have the flexibility and capacity to deliver?
  • Will the product fall apart?
  • Can I get better value for money somewhere else?

They need to make a yes/no decision on one or all of these questions based on the experience they have dealing with the salesperson in your organisation.

In some (and sometimes many) cases, they’ll simply walk away and NOT purchase because, for whatever reason, they perceive that it’s too risky to do business with your company.

Instead, if there was a consistent and powerful way for you to allay those fears, you’d experience a dramatic increase in sales … correct?

Well, by far the best way to turn skeptical prospects into delighted buyers is to lower the barriers to doing business with you. The best way of doing that is by offering risk-reversal measures. In other words, offer a guarantee.

Aren’t guarantees risky for my company?

A guarantee is a risk-reversal measure that gives customers peace-of-mind knowing that if they don’t like your product or service or if it doesn’t live up to its claims, they can return it for a full refund.

Solid guarantees have an absolutely massive impact on every business they are in place for. When used in your advertising material, guarantees increases the number of advertising responses you get.

They also increase your conversion rates. Not only that, they’re also a great management tool in helping with quality control.

The biggest reason why people don’t offer a guarantee

Very few industries offer money-back guarantees (mail order industry is an exception). The reason why they don’t is that they wrongly perceive that there is a big downside. They perceive that they will get bombarded with refund requests and consequently go out of business.

Obviously, the occasional person will ask for their money back on a purchase. 99% of those people will genuinely have a concern with the quality of your product or service. Only 1% of that 1% will try to take advantage of you.

BUT – even though refunds do happen, having a guarantee in place dramatically (very dramatically in many cases) increases sales WAY in excess of the refunds generated. 

Let me explain….

Let’s say that nobody in your industry offers a money back guarantee yet potential customers have big fears about whether your product  or service delivers. So - you put in place a 90 day money-back guarantee.

You promote that guarantee by featuring it prominently in all your signage and point-of-sale material. You also feature that guarantee prominently in all your advertising material as well AND your sales people make a point of mentioning it to all potential customers.

As a result of these measures, your sales increase by, just 25% … from, say, $750,000 to $1,125,000 …which is an increase of $375,000. Let’s say that your average sale is $1,000 which means you have attracted 375 new customers as a result of your guarantee with a total of 1,125 sales for the year.

Your refund rate would need to be 1 in 2 for that guarantee to be costing your business money. And the only way for that to happen is if your product or service is really shoddy.

According to Christopher Hart, author of “Extraordinary Guarantees: A New Way To Build Quality Throughout Your Company And Ensure Satisfaction For Your Customers” [out of print], unfair refunds come in at only 0.1%

If your sales increase by 50%, isn’t a refund rate of 1% very, very acceptable?

The reality is the implementation of a guarantee is more likely to increase your business by up to 350% … it’s THAT powerful.

So the fear that guarantees will send you broke is just an irrational fear. It won’t happen. In fact, the reverse will happen. It will send you smiling all the way to the bank!

Lisa Ormenyessy

Business Coach and Marketing Specialist at

I help SME's gain leads easily without breaking the bank. Talk with me and discover how to spend your marketing dollar and achieve sales using simple, proven, low cost strategies. | SavvySME Members Only Offer - Request your Free Marketing Review Session (valued at $397) & identify the hidden opportunities in your business & put a stop to the expensive leaks in your marketing