Simple truth: There are lots of people selling lots of nifty tools and products online.
And if the people behind these nifty products have done a half-way decent job of writing their sales copy, you will feel that each and every one of these nifty new things has just become essential to your business success.
But is it?
Some of these products are things that you simply don’t need. Hopefully, you’ll spot these right off. But many will fall into the right resource at the wrong time. This is where you need to be particularly vigilant that you aren’t sucked into the psychological buying triggers that litter all sales copy.
To help you make better decisions for your business, I’ve included some criteria that I use when evaluating products and tools for my clients.
Does this product meet a need that has already been identified for this business?
Or, is it a solution to a non-existent problem? Some of the best selling products solve non-existent problems, so be wary. For instance, what problem does the Snuggie actually solve? Is it a problem that you experienced and tried to solve before discovering sales copy for the Snuggie? (And if you actually own a Snuggie, do you ever actually use it?)
Will the product be easy to set up and use?
Any product that is difficult to use eventually becomes more trouble than it is worth.
Is the product affordable?
Take a look at acquisition cost as well as maintenance cost. Sometimes, product sellers will lure you in with a low initial cost, but hit you with higher fees later (Cable companies for example). So, be sure to read the fine print. Once you are committed to a product, the cost to switch will often keep you from changing even when you are unhappy, so be sure this product is one you will be happy with for at least a year (longer when the cost to switch is high).
What is the ROI (Return on Investment)?
In other words, how long will it take to earn back your investment? This can be literal dollars when what your purchase has a cost saving element, or it can be in the value of the time you save. Either way, make it a habit to look at every business purchase from the standpoint that you have to recoup the cost of whatever you purchase.
One of the worst reasons to make any business purchase is to simply take advantage of a sale or special offer. Be very wary of these sales tactics, especially online. They are used to motivate you to take action NOW, rather than putting it off until some future time which may never come. But what I often see happen is that people buy things that they don’t actually need, simply because they are afraid they will pay more for it later. This actually wastes your resources — your valuable time, energy, and money — that you then cannot spend on the things that you do need.
Consider this example: You have a business making golf clubs. Your business is doing well, making and selling over a million golf clubs a year. You have plans to expand your production facility within the next year. An investor approaches you and offers you a great deal on software that automates much of your production process. The regular price is $50,000, but if purchase within the next 90 days, you can have it for half price. This sounds too good to be true — this software meets every criteria that you have laid out for your new plant, and for less than you had budgeted — so you buy.
Now its 9 months later and you are ready to outfit your new plant. When you order the equipment, you discover that technology has changed dramatically in the 3 years since you bought your original equipment and now you can buy equipment that comes with pre-installed software. Making your $50,000 purchase obsolete before you’ve even installed it! And to make matters worse, the new equipment costs more than you budgeted for and you can’t afford it.
Don’t let this happen to your business. Always strive to use the Right Resource at the Right Time.