Risk Reversal Definition and Virtual Office
For years the consumer has been placed in the position that if they want to purchase any goods or service they have to buy it, then decide if it is right for them. This forces them into the position that they want to make sure a particular product or service is what they truly want. The consumer has been put in the position of purchasing then deciding. Many years ago consumers would have to make sure that what they had purchased was what they wanted because refunds were unheard of. As time went on companies that sell their products created warranties to cover breakage and malfunctions, but no matter what the problem was the consumer was stuck with the product.
Everyone understands the term risk, and there are only a few people in society that will take risk. Risk of losing life is the number one risk that people don't take, the other risk's are less severe, but all in all most people go through life practicing "risk avoidance". They don't want any part of risk that puts any part of their life in jeopardy unless that is what they think they are supposed to do. For example, consumers will put hard earned money into a 401k retirement plan because they think that is what they are supposed to do, when in fact the risk of losing money is great and they would never put their own money knowingly at risk in the same way. If they understood that there was a huge chance that they could lose the majority of their money, they probably would not put their money in such instruments but the financial institutions, and financial people have convinced them that this is what they should do.
Consumers think they are doing the right thing when in fact their will be a huge loss but they won't realize it until it is too late. If consumers were told the truth about their money they would not put their money in such instruments.
Risk of Monetary loss
One of the biggest risks that people get very upset with is monetary loss. When consumers purchase products, they want to evaluate them to make sure that they are getting what they want. They want to make sure that no one is going to "pull the wool over their eyes" and promise them more than they actually get. The severity of ill feelings moves on a scale where less money lost is easier to take than more money lost. The more money lost or spent to evaluate a product or service, the more scrutiny the product receives. Purchasing an automobile is a major expense which in most cases requires financing, creating debt. If a bad purchase is made then the consumer has a fight on their hands, this is why consumers do extensive comparative shopping to make sure that what they get is right.
Although governments have built regulations to protect the consumers [When a consumer purchases a very expensive product there are regulations that are designed to protect them.] the expense of making it right is more of a loss. Having to lose money never sets well with anyone and with many products now days having a very short life span sometimes it is hard to recoup the cost or loss before they have to purchase another product again, putting them in the same evaluation position. Years ago if you made a bad purchase you had time to use it after the cash outlay but today the break down of products "planned obsolescence" is designed so the consumer gets no reprieve financially before they have to purchase another product of the same nature. [Washing machines, refrigerators, television sets, etc.] Years ago people would drive cars for many years but today they don't even make it out of the financing period.
So lets take a look at what the consumer puts up with. When a company decides to sell a product or service they know that with reasonable distribution the consumers will purchase a certain amount of what they are selling. The companies know that if they make certain claims some people will purchase the product because there is a certain segment of society that will tolerate the product that stands for the specific usage. The cheaper the product the less risk the consumer is taking in their mind so if the product or service is priced within a certain range the "risk tolerance" is lower. Now the "risk tolerance" increases with income. [Some people have a higher "risk tolerance" of loss than others because their incomes will be higher.] In any event there is a break point for everyone, where they will feel uncomfortable with what they have bought.
If the consumer has to decide about whether they want you're particular product or not they now are pushed into a analytical mode of action that will cause them to have to do comparative shopping and also look for guarantees. The consumer knows that they have to bear the risk so they want to make sure they want to. They want to make sure that your product or service fits their parameters of what they are looking for. Having to bear the risk that someone else should, make's everyone uncomfortable. Consumers are not stupid people and know what they want and don't want. So when they purchase a product or service thinking they are getting one thing and getting something else they get very angry and suspicious.
Risk Reversal
When a company decides to sell a product or service if they are willing to let the consumer use it, indefinitely they are indirectly saying to the consumer we are confident that our product or service is what we say it is so therefore give it a try and if you like it buy it, if not you at least were able to satisfy yourself. When a company takes the risk up front the consumer is less likely to not want the product. The consumer is more forgiving when the company takes the risk up front than they would if they laid out their hard earned money and didn't like it.
When I say forgiving I mean that consumers are willing to look the other way if the product or service is not perfect, since they realize that nobody is, therefore they understand that they have time to figure a work around if necessary. And if the product or service is no good at all, their loss is only time testing it and not money. Educated consumers are demanding, more and more, that they try the product before they purchase it so they see if it meets the claims made.
When a company is un-willing to take the risk up front, than look out because you now are put in the position of deciding whether you want to take the time to understand and use what is being sold. Many times consumers will look for a product that they can try first. The internet is loaded with products that are given a 100% money back guarantee, which is getting close to "Risk Reversal" but not quite there. There are companies that will give you a trial period to let you load up your data into a software program realizing that you will not want to redo your data if you don't like the system. But all in all the internet practices more "risk reversal" than other industries. Some department stores will take the products back but you have laid out cash first.
Now when you are looking for a good or service you want to set your benchmark to the highest point then work backwards. Look for a product or service that allows you to use it first, no strings and no money, and then if you like it you can purchase it. If you can't find a "Risk Reversal" product then you can move down the scale to giving your credit card information with a solid guarantee. If you can't find what you are looking for in this category, then you are now forced into the uncomfortable area of analytical behavior.
The purpose of this article is two fold. One to explain the term "Risk Reversal" and second to point out that our Virtual Office is just that. A great example of "Risk Reversal" is Virtual Office http://virtualoffice.vereconference.com where you can use it no questions asked for as long as you want to see if you like it. You can even use it for your business and see if it fits into your business structure without spending a dime. This is "Risk Reversal" at it's finest.
What is Virtual Office? It's a system that allows you to do globally anything that you can do locally. You can do anything that you can do in a physical office, now with anyone else in the world. Virtual Office has bridged the gap of "flattening out the world" and enabling anyone to work with anyone else no matter where they are in the world. If you would like to learn more sign up for our free Virtual Office International Symposium and check it out. Go to http://unitednations.imasite.com and sign up, you will begin to receive a series of emails that will prepare you for this international conference. You will be there with people from all over the world. The emails will give you some instructions that you need to follow to get ready for the Symposium. Everyone has to be on the same page.
The Virtual Office International Symposium is developed by Dr. Raymond Jewell, Economic Advisor and Mr. Butch Hamilton, SEO Master to provide a "Risk Reversal" training system to teach people how to set up their own Virtual Office and in addition how to market on the internet. Don't miss this ground breaking event.
Thanks for reading,
Dr. Raymond Jewell
http://financialfreedomradio.info
http://financialfreedominsight.com
http://blogfather.net/blogs/virtualoffice.xml
Butch Hamilton-SEO Master
http://butchhamilton.4f500.com
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Raymond Jewell PhD
610-637-4884
Skype: rbjewell
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