Beyond Price Wars to Profit
In the face of increasing competition, it can be tempting to think that the only way to maintain your organisation’s market share and win new customers is by lowering your prices. However, such a strategy is rarely effective in the long-term. Instead, it can end up undermining your business, so it’s wise to use it cautiously.
That’s not to say that a well-timed sale doesn’t have its place as a tactic for drumming up new business and driving increased traffic – so, creating a legitimate opportunity for connecting with potential customers. But bear in mind that these benefits may be short-lived, lasting until your competitors decide to drop their prices. And engaging in a price war is no way to build a thriving enterprise.
Ultimately, the price tag attached to each of your products or services should reflect their value and quality. Consumers rely on pricing to decide between competing products regarding value for money as well as grade. By extension, a bargain basement price tag may inadvertently lead customers to view your product or service as lower quality and less worthy than one offered by your competitors. Perception counts. It’s a case of positioning your product or services with the optics in mind. As a result, dropping your prices shouldn’t be your go-to move when the going gets tough. Rather, play to your strengths by applying the following ideas.
Tap into loyalty to generate new leads
Without customers, your business is nowhere. This premise underlines why cultivating long-term relationships with your customer base is vital to the longevity and success of your organisation. How do you build such long-term relationships? As you would any other relationship; by listening to your customers, understanding their wants, needs, and pain points, and providing products or services that address these. And last but not least, by consistently exceeding their expectations not only regarding the value and quality of your offering but with a customer service department that’s a pleasure to deal with. Tick these boxes, and you’ll have an unstoppable sales force on your side; a contingent of loyal consumers who are willing to tell their friends, family, and colleagues how great your company is for free. What better way to get your name out there and generate new leads?
Sell your “why?”
Simon Sinek puts it best in his compelling TED talk – available here on YouTube – and his seminal book Start With Why. Both materials outline how consumers don’t buy what you do, but instead why you do it. Sure, customers are going to be interested in your product or service’s key features and unique selling points, but to truly win your customers’ hearts and minds takes more than that. It requires a holistic package; in other words, a core philosophy or brand story that consumers can relate to. Examples of super-successful companies that have become household names by “selling” a particular image or lifestyle concept are Apple, Coca-Cola, Mercedes-Benz, Disney, Louis Vuitton, Nike, and Starbucks.
So, if you want to connect with your customer base on an emotional level, you need to work on your “why”; the purpose or belief that explains why your business exists and that inspires you to do your best every day.
Give customers what they want
Another sure-fire way to attract and foster a loyal customer base is by giving them what they want. This circles back to two concepts that we touched on earlier, that is, listening to your customers and understanding their wants, needs, and pain points. Examining at your business from your customers’ perspective enables you to comprehend the journey a customer takes from the moment they first encounter your brand up to the moment the desired product or service is delivered. Being able to put yourself in your customers’ shoes is essential to framing your “why” in a manner that’s relatable.
Remember, pricing is just one of the many marketing tools at your disposal. Developing a business able to withstand today’s challenging market forces takes more than sensational sales; rather, focus on creating an unforgettable experience that will have consumers returning in the future. Ensuring your product or service not only meets but surpasses expectations is the most powerful way to secure your market share.
SMART Business Solutions will be shortly offering once monthly workshops for businesses covering many financial aspects. Our next Lunch and Learn Workshop is on Friday 6th September and covers how to prepare a marketing plan, and implement it, which will nicely address some of the areas discussed in this article. Book here https://www.smartbusinesssolutions.com.au/events/ SMART Business Solutions can also team up with you to develop a roadmap that will secure your future commercial success and check in with you to keep you on track.
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