Guest Post by Tim Thiel, Account Executive–North Region.
Recently, I had the pleasure of presenting Medallion Bank’s no cost/no fee Home Improvement Lending program to a group of contractors through one of our manufacturer relationships.
Before I got started, I offered a cold soda to the audience members. In the conference room were two simple beverage stations. The first was only a few feet away from the group. At the station were two large bottles of soda, along with a stack of cups and a sign saying “Soda – $2”. It was self serve, quick and easy. The second station was at the front of the room a few more feet away. That station displayed another sign: “Soda, no charge with ticket” and had an attendant to pour the soda for the individuals. In order to obtain the free soda, contractors had to take 2 or 3 steps to the end of the table where they could grab the required ticket. My goal was to give them a very clear choice.
After going over the nuts and bolts of our program, I returned to the free soda experiment to explain the Medallion difference. Checking the convenient self-serve station first, I was unsurprised to find no takers of the $2 soda, while everyone in the room opted for the no charge soda (this is where it gets good!). When I asked the room about the unanimous choice, the most common answer was “why would I pay for it if I don’t have to?” A few commented that the personal service was a nice touch, even with the simple task of pouring a glass of soda. Looking for even more insight, I pushed the audience further. They described the seemingly additional work to get the “free” soda as worth the few extra steps to save the money!
What would you do? Would you pay if you didn’t have to?
To offer highly competitive loan rates and terms, plus no fees on standard financing, we ask for paystubs on a minority of our loan approvals – big ticket jobs and customers with credit issues. Think of a paystub in this case as the free soda ticket.
So, if instead of $2 we were talking $1000, $2000, or more, would that impact your actions? After a 90 minute pitch and a solid close, would it make sense to take 1 minute to get a paystub (if you need one) and keep ALL of the profits that you earned?
Think of it this way, too. If you sold a window job and the customer asked you to quote their bay window as you were leaving, would you do it? You wouldn’t hesitate because 5 minutes could put another $500 in your pocket, so why not look at the 60 seconds it takes to get a paystub the same way?
Easiest is not best when it compromises your profits!