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The Law of the Ladder – How Customers Make Purchasing Decisions

Guest post by: Michael Farrell

Article Overview: All products are not created equal so there is a hierarchy, or product ladder, in the mind of the customer that is used to make purchasing decisions, explains Mike Farrell with aspenIbiz. Read this insightful post to understand the power of the product ladder and how your prospects use this concept to decide which product information in your campaign to accept and which information to reject leading to a purchasing decision.

The Law of the Ladder – How Customers Make Purchasing Decisions

While being first in the mind of your lead or customer should be your primary objective, the battle is not lost if you fail in this endeavor.

All products are not created equal so there is a hierarchy in the mind that customers use in making decisions.

For each category, there is a product ladder in the mind of the customer. On each rung is a brand name.

Take a look at the car rental category. Hertz got into the mind first and wound up on the top rung. Avis got in second and National got in third.

Your marketing strategy should depend on how soon you got in the mind of your customer and which rung you occupy on the ladder; of course the higher the better.

For many years Avis was on the 2nd rung of the ladder and advertised they had the finest in rent cars. Many renters wondered how Avis could have the finest rent car service and not be on the top rung of the ladder.

Avis then did what you have to do to make progress inside the mind of the customer. They acknowledged their position on the ladder and created a campaign where they said, " ... go with us! We try harder." And, Avis then started making a lot of money.

Many marketing people have misread the Avis campaigns. They assume the company was successful because it tried harder and therefore had better service. But that wasn't it at all. Avis was more successful because of how and where it positioned itself compared to Hertz on the ladder.

The mind is selective. Customers use the ladders in their mind in deciding which information to accept and which information to reject. In general, a mind accepts only new data that is consistent with the product ladder and where the brand is on the ladder ... everything else is ignored.

As an Internet Marketing professional, you need to determine how many rungs there are on the product ladder in your lead's mind and on which rung are you likely to be perceived.

It depends on whether the product you are offering is a product used every day (like beverages, toothpaste, or ceral, referred to as high-interest products) or purchased infrequently (like travel packages, furniture, or wealth management, referred to as low-interest products).

If your product is a high-interest product, there are many rungs on the product ladder. If your product is low-interest product, there are fewer rungs on the ladder. And, there is a relationship between market share and your position on the ladder in your customer's mind. You tend to have twice the market share of the brand below you and half the market share of the brand above you.

Sometimes your own ladder or category is too small. It might be better to be a small fish in a big pond than to be a big fish in a small pond. In other words it is sometimes better to be No 3 on a big ladder than No 1 on a small ladder.

Let's look at how 7 Up used this law to its advantage by being a smaller fish in a bigger pond.

On the lemon-lime soda ladder, 7 Up was on the top rung and Sprite was on the 2nd rung. However, in the beverage industry, the cola market is larger and therefore the ladder had more rungs. So 7 Up positioned itself in the mind of its customers with a marketing campaign called "The Uncola" and climbed the cola ladder and increased its sales.

Before you start any marketing program, you need to determine if your product is a high-interest or low-interest product; whether there are many or few rungs; and on which rung of the product ladder are you likely to be positioned in the mind of the customer. Then make sure your campaign deals realistically with your position on the ladder.

Many Internet Marketing entrepreneurs are using techniques and tools like mind-mapping, keyword research, Attraction Marketing Formula, Magnetic Sponsoring, and MindMeister to conduct the market research and utilize the Law of the Ladder. They then use the power of brand You Inc, and hypnotic writing skills in their marketing campaigns, to deal realistically with the position of their brand on the product ladder in the mind of their leads and customers. The goals is to not emphasize why their offering is better, feature and function-wise, over a competitor's but to develop a message that is recognized, accepted, and agreed to so that it will seduce and persuade a customer that what is offered will work for them.

Marketing is not a battle of products. It is all about the strategy you use depending on which rung your brand occupies on the product ladder.

You can find out more about Internet Marketing and home-based businesses by reading updates that will be posted at my blog over the next few weeks.

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Article Tags: Attraction Marketing Formula, brand You Inc, Digital Entrepreneur, Internet Marketing, laws of marketing, Magnetic Sponsoring, Mike Farrell aspenIbiz



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Re: need pricing help please - [quote="jvprosperity":t4htv1h6]here's my opinion that was derived from the person I heard it from (Russell Brunson) I view internet Marketing products as a Ladder. At the bottom of the Ladder is ebooks and at the top is One on One Coaching. so the ladder would look like this starting from the Top ($$$) to Bottom($) One-to-One Coaching ($$$$$$) Workshops ($$$$$) Teleseminars ($$$$) Video($$$) Audio ($$) ebooks ($) I agree with this methodology mainly because of the convenience factor and value from the customers point of view.[/quote:t4htv1h6] I also agree with this methodology, but sometimes some ebooks sell more in 2 digits. My 26 pages report sell for $9.77
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Re: Quote of the Day - "The only people witho - Thanks for sharing this Evan, there are some very powerful quotes in there, I particularly like this one:- You are now at a crossroads. This is your opportunity to make the most important decision you will ever make. Forget your past. Who are you now? Who have you decided you really are now? Don't think about who you have been. Who are you now? Who have you decided to become? Make this decision consciously. Make it carefully. Make it powerfully. regards, Mal.


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