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Cyber Monday and Black Friday are huge "Sale" days in North America - much like e-tailers and retailers in India have created "The Big Independence Day Sale" or the "Diwali Dhamaka Sale" in India. You get the best deals of the year on that day or over that weekend, and every seller is trying to out-scream the other on why you must buy his wares on that big sale day.
One clothing company in the US came up with this startling ad on a Cyber Monday, when every other clothing brand was screaming itself hoarse about hot deals on cool clothes.
Its "Don't buy this jacket" campaign became a big hit and built huge brand loyalty for it. At a time when competition was encouraging senseless impulse buying, here was a brand that cautioned against frivolous spending. Here was a brand that offered to repair a jacket and reuse it, rather than simply chucking it and buying a new one. A very different message, which resonated extremely well with consumers. The ad said "Don't Buy", but the impact was the opposite: Patagonia secured huge brand loyalty for itself, so the next time a consumer actually wanted to buy a jacket, he chose Patagonia over competition. Patagonia won the trust of consumers, and with that their loyalty and their business.
Welcome to reverse marketing
Reverse marketing is any marketing strategy that encourages consumers to seek out a company or a product on their own, rather than a company trying to sell specific products to consumers. Firms who try reverse marketing, usually try to provide information and advice without plugging products, in a bid to get consumers to seek them out rather than the other way around. In our business, Investor Education Programs are used very effectively by many distributors as a reverse marketing strategy. What Patagonia did was a combination of education with some "shock and awe" - an unexpected message that caught the attention of consumers, because it was exactly the opposite of the messages that others were communicating. And of course, the message made a lot of sense, and helped consumers make the right choice.
Reverse marketing applied in financial products distribution
Most serious and experienced distributors have a set of principles that guide their choice of fund recommendations. Some choose to stay away from closed ended funds, others choose to stay away from NFOs, and many create recommendation lists that are largely influenced by long term consistent track records of funds.
If you are a distributor who has chosen to stay away from recommending closed ended funds for example, and you find a promotional campaign for a 3 or 5 year closed ended fund, here's a message you could consider sending out to all your clients and very importantly, to your prospects.
The subject of your mail can say, "Please don't buy this fund"
The text of your mail could go on to say something like this:
Please don't buy ABC Closed Ended Equity Fund
We at XYZ Wealth Creators are registered distributors for ABC Mutual Fund, as we are for all leading fund houses in the country. We carry a number of funds of ABC Mutual Fund in our recommended funds list and have great respect for their fund management capabilities. Yet, we have no hesitation in telling you, "Please don't buy ABC Closed Ended Equity Fund".
At XYZ Wealth Creators, we believe in recommending only open ended funds with stellar long term consistent track records. We believe one of the biggest advantages of mutual funds is the liquidity aspect - something that sets it apart from real estate. We understand that in the dynamic world you live in, locking up any part of your wealth is not a prudent decision, especially when the same objectives can be achieved without putting unnecessary restrictions that closed ended funds impose.
We are aware that the vibrant promotional campaign for this fund would most likely have reached you one way or another by now. Hence this mail, to alert you to stop and reconsider before making an impulse investment influenced by an attractive campaign.
Mutual funds are not impulse buys. Think carefully before committing your hard earned money. Ask us as many questions as you want, to gain the comfort and conviction that you are making a wise investment decision. Ensure that the investment you are proposing to make is aligned with your financial plans and goals. Only then should you commit your money to an investment.
We remain committed to helping you make sensible investment decisions. We remain committed to helping you cut out all the noise, and focus on what is really relevant to you.
Warm regards,
XYZ
Managing Partner
XYZ Wealth Creators
How do you think clients and prospects would react?
Would such a mail be positively or negatively received by clients and prospects? Will such a communication help strengthen or weaken your credentials? Will prospects be more or less inclined to consider your services? Will prospects be more or less inclined to call you the next time they need some unbiased guidance? If such a message is posted by you on social media, what are the chances of it going viral, in its own small way? What are the chances of you getting many more leads as a consequence? Will such a reverse marketing strategy open or close doors for you?
Disclaimer: It is not the intention of this article to express an opinion on closed ended funds. We trust readers will appreciate that this category of funds has only been used as an illustrative example, to bring home the advantages of the concept of reverse marketing.
All content in Marketing Wiz is created by Wealth Forum and should not be construed as views of Kotak MF.
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