If you don’t position your value, you may lose your value and your customer!
In today’s competitive marketplace it’s no wonder that many products and services are viewed as commodities. The reality is that you are only a click away from being compared to your competitors and it sometimes seems like a race to the bottom to get the business.
Think about it. If a bag of rice and a bag of rice and a bag of rice all look the same, how much do you want to pay for it? The lowest price possible. The lesson is simple. If you fail to position your value, you lose your value and the price leader wins the business. You can be the price leader with just a stroke of the pen but you may say goodbye to margin, profitability and growth (and you might want to update your resume while you’re at it).
The good news is that there are no commodities in the world of value-added selling, so if you will take a little time and identify and position your value-added benefits, you are on your way to market differentiation, improved margins and profitability.
Here are some strategies to help you add value to your offering.
1. Become a trusted advisor – When you become a trusted advisor to your customer, it’s essential that you have a thorough understanding of their business. You can’t just be an expert on your company’s products and services. You must understand how your product or service impacts your customer’s business. Knowledge of your client’s industry is a must.
2. Bundle your value – A great way to add value to your product or service is to put together a number of services or line items to provide added convenience to your customer.
3. Tiered service levels – Instead of one service level for all, try adding different service layers based on the customers needs. Some of the best companies in business today use this to effectively differentiate themselves. For example, when you go online and purchase something from Amazon, that’s the first transaction. The second transaction is when you determine how fast you need it. I signed up for Amazon Prime when it was first introduced and for a few extra dollars I can receive the item a little sooner than if I used the traditional delivery service. They also include their online video service as an additional value-add. (bundling in action)
4. Customer loyalty programs – We all know it costs more to acquire a new customer than getting repeat business. How are you rewarding your customers for their loyalty to you? Starbucks sends me complimentary drinks on my app, my airline gives me boarding perks and free airmiles and my hotels upgrade me to nicer rooms. Nordstrom sends me bonus dollars for my next purchase. I know these are inducements, but they work for me, and for others.
5. Dedicated support channels – One of my credit card companies offers a dedicated concierge number that I can call when I need travel or restaurant reservations. It also comes in handy if I’m trying to find a ticket to a popular event or concert. And as a result I use it more frequently than the cards that don’t offer this level of service. Nordstrom offers a private shopping experience prior to a major sale and it is usually after hours. They’ll also complement the evening with a glass of wine to wander about while shopping.
6. Join your customer’s training department – Onboarding new people can get quite costly to companies. Offer to become part of your customers training programs and provide a module or two to supplement their training curriculum. Don’t just talk about your product or service. Talk about the industry in general and offer a broader perspective.
Starting to get the picture? When you effectively identify and position your value-added benefits, you move from a commodity provider to a “preferred provider”.
It’s of key importance to note however, that you need to provide value to your customer as they define it and not as you do.