Thursday, November 27, 2008

“KISS”...Keep it Simple and Stupid...

Most often we see business deals or proposals simply flying out of our hands, just because we cared too much to explain all the complexities in the plan. Many of us have personal experience of the same happening and others must have seen it happening around them or read about it in the newspapers.
We all have some services to sell. And we all have accepted that every one of us is a born salesman. The only difference is that some people accomplish far more sales than others; they become millionaires. It has also been agreed that the total money being circulated in any market is more or less the same; when some people become rich naturally the others end up becoming poor.

There has always been a constant effort from the governments' part to protect the interests of the poor. Certain private organisations have also sought to alleviate poverty. Everyone truly wants poverty out of our as well as our loved ones' lives. But nothing anyone has done, has ever made it possible to eradicate poverty from our society. No matter how much money we take from the rich and give to the poor, as long as the rich have some wealth creating mechanism in their hands, the spent money simply returns to them.

If we sincerely want to help the poor, show them a wealth creating system. Only then, equality will be achieved. Now is the best time to think and act so. We all know, there is a global slowdown as well as an economic recession. But how many of us have really felt the pinch of it? Not many.
If the economy is perishing then it's for sure that the rich have lost money. Rich people and their services contribute to the economy, If the economy is hit then we can almost state that the rich are getting poorer. So if the poor have to close the gap, then this is the time to get into the system and narrow down the differences...

Just because the economy is crashing or people have reduced their purchases doesn't mean that we need to stop selling. If we stop selling, our family stops getting its daily bread. The best strategy to adopt is "selling more during tough times makes you rich faster."
The best tip that I received in the last 2 months from an economist is to "KISS - Keep It Simple and Stupid”. Keep the vouchers, pamphlets, description and presentation of the product you sell, simple and stupid. In these tough times, it gives off a better return than a complicated and sophisticated approach
I got this idea of "simple and stupid" when I chanced upon a college’s placement website. Let me tell you, the website was the most basic version. It was sold to the college by a team for the cost of a premium package version. When I asked the co-founder of the college, how come they bought this basic version at a higher price when a lot many features were missing, the response I got was "The web company never mentioned any features or addon packages in their brochures. All it said was they had websites to sell. Because we wanted one badly, we took it".
Had it been me selling the website, I would have taken the pain to educate the customer about the pros and cons of the different versions and simply ended up losing them. The golden rule is “If the customer is not willing to learn about the product, you do not elaborate on any advanced feature. It’s a safe bet that the customer will buy anyhow".
Now lets consider ourselves as a customer, do we buy things seeing the feature or the benefit? We shop for the benefit; the feature will create confusion in us. I went to an electronic store to buy a home theatre kit. I would have bought anything on a compromise of the price and quality. Fortunately the salesman was an engineer, he quickly added on additional features like "Dolby pro logic II', 'Quarter to quarter surround'. This made me revoke my decision to buy right then, I said I shall make a study and return.
Now that most companies are cutting down costs, this definitely improves the efficiency of the firm. But it also ensures the end product has only a marginal profit. Thus we have stricter competition and it’s almost certain that we will be thrown out of business if we don't make sales. One way to face the cost-cutting paradigm is to ensure that the end price of the product is a summation of the components. Here again it's the “simple and stupid” phenomena that’s working.

I got this idea when I visited an upholstery shop to get the cars seats done. They said “the total cost for the leather seat cover would amount up to 20,000. We can help you decide by providing a split up.”

1. Cost of material 15,000
2. Labour 2000
3. Adhesives, foam and fitting 3000

I made a deal with them saying I would get them the material, they can do the stitching and fitting. They agreed to it without any problems. Now the catch was that when I enquired about the price of leather, I realised it would cost me 16500 for the material alone. Since they had tie up with the agencies, they would get it at a lower price. And so I went back to them and accepted their price. For them they got their sales closed by showing the customer a split up of their service.
To make the most out of any tough situation, it is simple strategies like these that we need to concentrate on and get working…

No comments:

Post a Comment