In 60 Seconds
- •The Friction: The #1 reason people don't buy is fear. Fear of making a mistake. Fear of being ripped off.
- •The Shift: Risk Reversal takes the risk off the buyer's shoulders and puts it on *yours*.
- •Standard vs. Elite: Standard = '1 Year Warranty'. Elite = '100% Satisfaction or Money Back'.
- •The 'No Lemon' Guarantee: 'If the compressor fails in 5 years, we don't fix it. We give you a whole new unit.'
- •Math of Refunds: You might refund 1 out of 100 jobs. But the guarantee will help you close 20 more jobs. The math wins.
In every transaction, there is a "Risk."
- Will the roof leak?
- Will the contractor ghost me?
- Will the price go up?
Usually, the Customer carries the risk. They pay the deposit and hope.
Risk Reversal flips the equation. You (the Expert) carry the risk.
When you say: "If you are not happy, you don't pay," you remove the barrier to entry. Your closing rate skyrockets.
Types of Power Guarantees
1. The "100% Satisfaction" Guarantee
- Promise: "If you complain, we fix it. If we can't fix it, we refund your money and remove the system."
- Fear Removed: "What if I hate it?"
2. The "No Lemon" Guarantee (Equipment)
- Promise: "If the heat exchanger cracks in the first 10 years, we don't just replace the part. We replace the ENTIRE furnace for free."
- Fear Removed: "What if I get a dud?"
3. The "$500 Fix It" Guarantee (Dates)
- Promise: "If we don't finish by the date written on the contract, we pay you $500 per day until it's done."
- Fear Removed: "What if this drags on for months?"
4. The "Apples to Apples" Guarantee (Price)
- Promise: "If you find a comparable installation (same specs, insurance, warranty) for less within 30 days, we'll refund the difference + $100."
- Fear Removed: "Am I paying too much?"
Doing The Math (Why this isn't crazy)
Owners fear: "Everyone will ask for a refund!"
Reality:
- Dishonest customers are rare (<1%).
- Most people just want the job done right.
- If your average ticket is $10k, and having a guarantee increases your sales by 10%, that is huge revenue.
- Cost of Guarantee < Revenue from increased Conversion.
Verification Checklist
- Written Policy: Is the guarantee written clearly? No fine print.
- Sales Script: do your reps mention it before the price objection?
- Legal Review: Have a lawyer check the wording (Ensure "Satisfaction" has a definition, e.g., "Within 30 days").
Common Mistakes
[!WARNING] Vague Guarantees "Satisfaction Guaranteed" means nothing because everyone says it. "100% Money Back or We Remove the Unit" is specific and powerful. Specificity = Trust.
- Hiding it: Don't put the guarantee on the last page of the contract. Put it on the Homepage. Put it on the Truck.
- Making it hard to claim: If a customer invokes the guarantee, honor it fast. If you fight them, they will destroy you on Google.
FAQ
Q: Doesn't this attract scammers? A: Sometimes. But scammers usually look for weak targets. Strong guarantees signal "We are so good we aren't worried."
Q: Can I limit the guarantee? A: Yes. "residential only." "Owner occupied only." Set boundaries.
Sources and References
- Jay Abraham: The Strategy of Preeminence - The godfather of risk reversal.
- Harvard Business Review: The Power of Unconditional Guarantees - Business case.
Changelog
- 2024-07-04: Initial publication.
Read Next in This Hub:
- Trust Badges - Visualizing the promise.
- Price Shopper Framework - Using guarantees in negotiation.
Related System:
- Brand Positioning - Defining the offer.