August 2, 2022

Final Sale

Let’s say you want to buy a lamp for your living room.

You go to Target and find one that you think would be perfect.

The price tag is $35, which seems about right to you.

But then...

You notice a sticker on it that says “ALL SALES FINAL”

Which means that you cannot return it for a refund for any reason.

Does the $35 still seem reasonable?

Or would you start wondering whether it’s actually the perfect style?

Or if it’s maybe a little bit too big for the space?

Or if the shade doesn’t quite match your color scheme?

Or what if it’s broken and doesn’t light up at all?

Now how much would you be willing to pay if you knew you couldn’t return the lamp under any circumstances?

I’m willing to bet it would be less than $35.

Here’s the thing...

One way to dramatically increase your prices is to offer some sort of credible guarantee.

If you want to start justifying increased prices by offering guarantees, you need to ask yourself two things:

  1. What promise are you willing to make?
  2. If you break your promise, how will you make it right?