End of story.
Well, not quite.
What you should do is improve the value of your product or service to entice customers.
Your price represents the perceived value of your product. You strive to increase the difference between your product cost and that perceived value. The larger it is, the more profit you make. You've fought hard for that space and should do everything possible to protect your profit.
Cutting your price tells your customers your product isn't worth what you're asking them to pay. No one pays the list price for cars and pizza. We all know those are inflated. These brands use pricing tactics to drive transactions. There are many other ways to increase the value of your products or services, and they do not have to always be a physical addition. Here's nine things you can address to improve value.
Offer better quality - Enhance your product by creating desirable packages, unique purchase levels, or other benefits that are significant in value beyond the product itself. A local pizzeria created a product bundle by adding in custom popcorn from a neighboring business. This helped build both brands' values.
Increase convenience - What ways can you get your product to your customers faster or with less hassle for them. Consider renting a car where you jump in and go instead of standing in line at a counter to sign a ton of paperwork. If you are saving your customer time when they are acquiring your product, the value of your product is increasing.
Provide additional expert advice - The Thighmaster became a huge success for two reasons: a doctor recommended it, and the simple addition of an exercise plan to aid customers in using it as best as possible. "But wait, there's more" really does work. The total offer is much more than your product or service. Provide more information to help customers use your product or service easier and quicker. Be sure to provide more sophisticated and better information than your competitors do.
Improve your customer experience - improve the simplicity of your product purchase. Analyze the entire process to find where you can smooth out the process, eliminate obstacles, and save the customer time. Selling the time you save your customer is a solid advertising strategy. Miller has been doing it for decades with their "It's Miller Time" campaign.
From your lead generation process and continuing through the post purchase phase where you can drive repurchases and referrals, improving your service will build your products value.
Serve more frequent customers better by adding privileges for them such as a live person answering their call, no wait product pickup, or free delivery.
Onboard your customers better than your competitors - The investment in time and support will create better, long term customers.
Give social status to your customers - create status and exclusivity with rewards and special benefits. Promote social responsibility: Toms gives away a pair of shoes for every pair purchased. Crate & Barrel provides gift certificates for its customers to finance projects on Donors Choose. Corporate altruism boosts the perceived value of a brand's products.
Improve your products image - upgrade your product's packaging and design where possible. Do you feel milk is better in a glass bottle compared to a plastic one? Milk is a commodity, it's the same no matter where you get it, but it's perceived better coming from a glass bottle.
Use physiological triggers to build product value - This includes tactics of ending your prices in 9's instead of round numbers. If you have a prestige product like champagne, however, claim your price in a round number, $100 for example. Adjust how your product is physically presented by placing it amongst others whereby yours is a much better value than the rest. This is a comparative pricing technique and it works extremely well. Finally, visually highlight the price differences through bright, bold, clean, & simple signage.
Create an emotional connection to build value - Find ways to create an entertaining and social experience for customers to shop and buy your products. The celebratory photos arranged after you purchase a car or house are one example of creating an emotional connection.
Through your advertising, sell the inspirational story that you'll be just like the superstar when you have our product. We could all be like Mike with our Nike's on. Gatorade empowered young girls to drink their electrolyte water with Serena Williams.
There are many no or low cost ways to build your product's value in your customers mind. With a little creativity you can protect your profit margin and launch yourself back to stability as we all learn to navigate through this crisis. You'll be in much better shape by protecting your brands value perception than cutting prices and fighting to gain it back over time. Don't cut your prices, and that is the end of the story.
At Shockwave Marketing Systems, we help business owners who are frustrated with their marketing results by taking them through a four-step process to clarify their marketing, save time and money, and build sales. Getting your message right is step 1. Through a few exercises we'll help you find the clarity your marketing needs to get the better results you are looking for.
If you desire better marketing results please contact us at 314-467-8404 or email@example.com.