Posts tagged as:

pricing

Your Customers Are Not Morons

by Daria Steigman on January 31, 2012

Customer Service, Empowered Customers are not ClownsThis should be obvious, right?

[Insert BIG SIGH here.]

There’s a lot of talk these days about “empowered consumers” and what this means for companies. It’s an issue for  pricing and sales, and for what consumers want and expect from the brands we interact with.

We have more information than ever a mouse click, search term, or social scroll away.

There’s a big gap between the empowered consumer and many sales and customer service teams.

Case in point. I was shopping around the other day for information on Internet service providers. Mine has been very reliable–but the price has gone up astronomically. So here’s how the conversations went.

1. Existing provider said they felt my pain. Customer service agent put me on hold for a couple of minutes while he (maybe) went off to see if he could give me a different service or a better price point on this one. Came back and spouted a company line about having only one speed of service and that I was paying the standard rate for that. I told him I was going to cancel. Said he would be sorry to see me go.

The rate I was paying was $7 over the highest rate listed on the company’s Web site. The base rate was 40% lower than what I was paying.

2. Prospective company’s sales guy wants to know what I’m paying now. Not relevant, I reply, I want to know what options you offer. Sales guy asked what provider I have now. (Nice try, same answer.) Then he starts talking about bundled new services–which I say is not what I’m asking about either. Finally, he quotes me a price.

The price he quotes me is 25% higher than the rate listed on the company’s Web site. And it’s for completely unbundled service–and I already have one service through this company.

They must think we’re morons.

Clearly, companies have a long way to go in understanding how the Internet–let alone social platforms–impacts the business/customer relationship.

Photo by macinate (Flickr).

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Why Every Deal Is Not a Bargain

by Daria Steigman on December 12, 2011

sales, marketing, value, Independent ThinkingWhat’s up with the “2 for 1″ sales trend these days?

My thinking on pricing,  rates, and value is pretty clear. And I don’t understand why some people think every deal is a bargain:

  • “Buy 1, get 1 free” suggests the item is overpriced.
  • “Buy 1, get the second free (just pay separate shipping)” suggests the product is so cheap that all the profit is built into the shipping cost.
  • “Used to be [a lot more], but really great price today” tells me the product is pretty close to worthless. And no one’s buying it and we desperately want to get rid of our inventory.

I’m all fine with sales–everyone knows that’s a temporary drop in your profit margin. (And “2 for 1,” used judiciously, can serve that aim.) But when your business model is all about discounting, then I start to get worried.

What about you? Seen any deals lately that aren’t bargains?

Photo by Anthony Easton (Flickr).

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The Price of Milk

by Daria Steigman on May 17, 2011

pricing, marketing, business, Independent ThinkingPricing can be tricky.

Aim too low, and people wonder what’s wrong with your product (or think your service is second rate). Price too high, and you might have few or no takers.

I’ll pay a premium for value. Great customer service, beautiful design, and reducing carbon emissions are all value-adds worth paying for.

A gallon of milk is not a premium product. So charging a 33-percent premium ($3.99 in this store versus $2.99 here–and even less at Costco) is just asking me to shop elsewhere.

Why would any business want to do this?

Photo by Muffet (Flickr).

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Chris Brogan, Day Rates, and Value

by Daria Steigman on March 9, 2010

I was a little surprised last week by all the attention surrounding Chris Brogan’s day rate. A little of it reminded me of when I started my business and a few (former) friends decided I was really sitting around eating bonbons and cashing trust fund checks. Mostly it reminded me that too many people don’t know how to value their work.

My day rate may not be $22,000, but I do not allow organizations to pick my brain by the hour. My hourly strategy rate is primarily used to establish a retainer or a project fee–both of which build in start-up, research, concepting, and so forth. Not to mention intelligence, know-how, and expertise.

Why would anyone walk into a room and discount that?

Photo by Esparta (Flickr).

Have you signed up to receive the Independent Thinking newsletter? Now’s the time! Once a month I’ll send you exclusive, subscriber-only content highlighting interesting articles I’ve found, as well as tips on marketing, social media, and how to grow your business. Sign up today!

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