Love that idea! We’ve been using iContact with great success lately. Stealing it… Thanks Kevin
Ke vin Ke vin Ke vin <---- Chanting
I’m curious are you against all discounting to get people to try your service/product?
Joshua, what’s the scoop w/ iContact?
My pleasure.
Thanks 
I feel so cared about right now…
Good question. Especially with the facebook-related question.
For window cleaning companies, yes, I think it’s dangerous beyond (below) certain levels. It attracts the wrong kind of client, and costs you all of your profit in the process, or in worst-case scenarios, it costs you MORE than your margins, and you fall on your own sword.
Especially when we are deluded into thinking that these people are going to be long-term, full-price paying customers beyond their initial low-price consumption. Experience and history seems to suggest otherwise.
To complete the thought, though, no, I am not against all discounting. I just think it has to be done incredibly carefully.
For instance, with Groupon-type sites/opportunities, I would suggest crafting a high-end, expensive (high-margin) service package unlike anything else currently offered from your company, and making only it available on Groupon.
“Platinum Home Rejuvenation Package - $799”
Protect the margins, craft the offer carefully. Do not count on repeat business. Do not count on upsells. Do not expect to develop a long-term relationship.
As an alternative, you could offer bare bones, sample-sized service only. “Five 1st-floor windows for $20” Give people a chance to see the difference that clean windows could make, and give them only a small, quick taste, not an ounce more.
With respect to me…
For pure-profit information products that are one-off consumed, hey it’s all margin, every last drop of it. Although - truth be told - it will also affect the experience with my product (my book) in a negative way.
It’s true. The people who paid $50 for my book yesterday won’t value it as much as the people who have paid $97 for it this past 8 months. As a result, they won’t take it as seriously, won’t implement as much, and won’t experience as many positive results.
There is a cost to them and myself.
I’m curious to why you would drink the toxic Kool-aid yourself?
I assume you are referring to my book.
My response:
High margins still allow for enough profit with this level of discount that I’m pleased, and the product in this case is a one-off lifetime sale, with no repeat potential. Zero cannibalization of existing clients.
I acknowledge there are weaknesses, though, as I said.
However, please note that the book was sold at approximately DOUBLE the cost of every other business book on the market, so I lost less than you might think at first glance. It’s still probably one of the most expensive books my client has ever bought, given the $50 price tag + shipping. That’s an important factor.
I maintain credibility.
Additionally, since I provided the discount, I did not have to deliver the book for 50% off, and then receive only half of the remaining 50% of gross revenue. I did not trade dollars for quarters, I traded them for 50 cents each.
I like that you are challenging me, Don. Keep at it.
When we imagine that we’re going to make a killing on impulse up-selling and cross-selling and that people are going to buy duplicates of the discounted service/product (i.e. window cleaning services) in the future at FULL price, we are drinking the toxic Kool-Aid.
Assume tiny amounts of successful up-selling and cross-selling, assume tiny amounts of desirable long-lasting customer-relationships, and assume that people are leveraging and building their relationship with Groupon, not you. If you have your eyes wide open on this, you might find a way to still make money as a window cleaning business owner, in the short-term.
Here are two specific ways I suggest:
As I recommended, either offer barrel-bottom service packages, or super-high-margin packages/services/products. Either way, you win in the short-term, and you aren’t betting everything on an uncertain future. Either way will prevent Groupon from killing your business.
These conversations are important.
Thoughts?
Kevin, We’re all in the relationship business. No repeat potential are you kidding me? You’re going to sell information over and over and over again repackaged, redesigned and reformatted. But what you’re going to sell is information whether in a book, phone call, or seminar.
So if someone’s window cleaning service was twice or 3 times as much they would they would maintain credibility while discounting?
But from your previous posts it would still be toxic in the customers eyes.
Whatever position a person holds when it’s being questioned it makes you research and question(even if a person’s logic is flawed), making a person more knowledgable. You are great at keeping it off the person and on the issue. Which is very important for debate and very easy to get away from. So I commend you on that.
So when someone buys your information at a later date at FULL price, wouldn’t that be the same Kool-Aid Kevin?
I agree with you partially. During school did you ever have people so worried about getting good grades for school that they forgot to get an education? Sometimes being so focused on the short term, that a person loses sight of what’s the reason they are playing the game. But I do agree you can’t give away everything and expect to stay in business long.
I like the package offer, I did something very similar for a spa last year, made the Royal Caribbean Deluxe Package and had a value of $399. Actual cost was in the ball park of $50-$60 (guestimatting.)
I also did something very similar with a trade I did with a radio station the past few years. 150 feet of first story gutter.
None of it matters though if you don’t have systems that back it up or your service is 2nd rate.(to upsell, get referrals and create a smiling customer, then ways to stay in touch)
Wow, thanks for the detailed reply.
Okay, I’ll try to reply, even though this is getting a little confusing.
My replies in [COLOR=“#4169e1”]BOLD and blue[/COLOR].
I will say that this conversation is starting to feel a little circular and redundant.
Here is my simplified position:
[I]Groupon sells the dream of robust, highly profitable, long-term relationships in exchange for immense short-term losses, and arising from trained-to-be-razor-sharp-focused-on-cheapest-price target demographics. I say that’s a psychotic business growth strategy.[/I]
You can win by changing their game, and adding a few new rules of your own. It’s currently Russian Roulette, and they’re trying to tell you it’s fun and smart and you’re probably gonna win. I am simply saying take all the bullets out, so you [U]can’t[/U] [U]lose[/U]. Rig the game in your favor.
Imagine I said this to you:
[B]"Don - I have a brilliant idea to land you insane numbers of new clients. How much do you charge to clean the windows of an average-sized home? $149? Cool, okay hear me out…
What if you have this huge sale, and offer to clean any average-sized home for only $75? Isn’t that brilliant? Just imagine how many new clients you’ll get! Oh - but before I forget, you actually will only earn $38 per house, because I need to take half as my commission for this genius marketing ploy, and I’m going to make sure that every single coupon-clipping, deal-loving, price-shopper in your city hears about this, and tells all their frugal friends about it, too!
You know all those people who expect you to clean their windows right now for only $75, who you say no to? Imagine how amazing it will be when they hire you, and you can show them that you’re awesome! For sure a ton of them will pay you $149 next time, right? Right? (But don’t forget, you only get paid $38 this first time around, sorry, just business, nothing personal)
Just imagine how much your business will grow! Open your mind!
And even though you’ll be only earning $38/house, you’ll have HUNDREDS of them to clean, so you’ll still make money!
Sound good? I can make it happen tomorrow! Let’s do it!"[/B]
I hope you would recognize that I am a marketing moron, and that if you take my advice, you could literally destroy your business overnight for a myriad of reasons.
And yet the world is singing about the genius of Groupon for small business growth.
Wow. This thing is toxic.
[B]It’s the weakest marketing strategy ever known:[/B] Slash your everyday price on your normal, cool stuff by 50%, and all the new customers you obtain will all forget what they paid and pay you 100% next time, and everyone wins. Of course, you’d have to assume they all lose their memory, but remember you. Oh, and they’ll stop searching for another cheap window cleaner from Groupon for the next service, too.
And…maybe they’ll even pay you full price for really expensive other stuff while they’re already there, and you can make gobs of money selling the coupon-clippers the expensive stuff, because deal-seeking, Groupon groupies just might fork over big bucks for your other stuff even though they only came to you because you offered the low price.
This is the Kool-Aid.
DO NOT DRINK.
The most fascinating part to me is that very few have stopped to question it.
Anyway, you know how I feel 
Is there a residual effect on other same-industry providers in the same city as the Groupon Kool-Aid drinker?
You know, in the same manner a – for lack of a better term – lowballer may affect a market short-term.
“Do you offer the same $75 deal as that guy last year? You know, whatshisname. His phone number is out of service…”
Good question.
I don’t think it would, no. In fact, I think you could leverage their disaster by positioning yourself with an overt, committed, ZERO GROUPON POLICY.
That sounds too aggressive.
I should have said “leverage their foolhardy business decisions”.
These are real people who likely worked hard and tried their best. They just trusted the wrong experts.
Their disaster is sad. It does create an opportunity, but I don’t think their demise should be reveled in.
Poor choice of words on my part.
I’ve never researched Groupon, except to note that they are not in my small, rural market.
Are there service provider testimonials recounting extraordinary successes?
It took economic cycles and forecasting in college and I tried to plot what you are saying into graph and did not make sense in your analogy. You could make short term gain, long term lose and eventually law suits to the business.
If your price is low, maybe your demand for service might go up and this depends on other economic variables and trends. if one economic variable goes bad you might go out business. If a business is going to do massive coupon make sure you have the financial backing for long term run;)
I have an idea, I ll do the groupon and clean ten windows with our wfp and only the side without the screen
If you’re serious, yeah that kind of bare-bones package would be a sample-sized snack pack type of package that I think would work if you priced it well. Make it a new sample package. Good idea.
“10 Windows Cleaned by WFP for only $75!” Essentially waiving your minimum, and slapping a had limit of 10 windows on it.
And pricing it so you can win even in the short-term, and if no one upgrades to anything else.
