Winning customers in 2.6 seconds
As a modern drycleaner, you face some critical questions.
One is: How do you succeed in incredibly complex, uncertain markets that are
intensely competitive?
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For today’s customers, buying decisions are usually not the result of long periods of
comparison about which competing business is better. In fact, most purchase
decisions are made in about 2.6 seconds.
How do you win customers in 2.6 seconds?
You need a strong value proposition. Value propositions focus on what matters to
customers. They are the promises fulfilled by your services.
Value propositions change over time as customer audiences and needs change, and
as competitors catch up and markets evolve.
They are therefore temporary; they address the needs of today’s target customers, while expressing how you are different from today’s competitors.
To create a powerful value proposition, you must offer more perceived value to
the customer than your competitors offer.
To do this, use the following process:
• First, research the benefits that customers believe they derive from your
services and others like it.
• Second, consider how customers perceive your services relative to others. Do
they get more or less benefit from your services compared to your competitors’?
• Third, align your proposition to a specific target market.
• Fourth, price your services so that customers will realize a good value for
their money.
• Fifth, ensure that the price also allows you to collect a reasonable profit.
• Sixth, continue to track customers’ perceptions and evolving value propositions in your market.
Customers perceive the value of your services based on the benefits it gives
them. Consider the value of “free pick-up and delivery.” It provides absolute benefits that include saving the customer time, saving
them gasoline and money, and it simplifies their lives.
However, because there are many competing pick-up and delivery services, the
customer weighs those benefits against all of the others. The comparative
benefits are the areas in which you must set yourself apart.
For instance, do you offer a written guarantee that all laundered shirts will be
ready to wear, with no buttons missing, every time?
The pricing should then reflect the comparative benefits, but also recognize
that the customer expects good value for the money, so the price must be
justified by the extra benefits.
Customer value propositions articulate the value your business offers to a
specific group of target customers by understanding them better than the
competition and focusing on what matters to them.
How do you establish a solid value proposition? You do it through a six-step
analysis:
1. Identify the target audience.
I don’t just mean, “Those rich people over there.” You have to get to know and understand their needs, wants, and aspirations.
What would make them interested in your services?
2. Determine what type of solution they seek.
Do they want a simple one, like a guarantee their clothes will be ready on time,
or a complex one, such as coming into their home and hanging his and hers
clothes in their respective closets?
3. Examine why they should choose your particular service.
How is it better than other offerings?
4. Explain how you’ll deliver the difference.
How can you offer these benefits better than anyone else?
5. Find out exactly how much customers will pay.
Will they pay 10 percent more than the market average? Twenty percent more? Or
some other price?
I can’t tell you how many times drycleaners call me, bemoaning the fact that all of
their competitors are low-priced and they “can’t” charge more for their services.
However, when I ask them if have they attempted to pull away from the crowd with
higher prices for their (self-proclaimed) superior services, the answer is
usually, “No.”
6. Evaluate what customers don’t get from your services.
And what do other cleaners offer that you don’t?
This analysis helps you to identify a winning value proposition.
Once you do that, you must enhance the value of your services by creating a
customer experience around it.
A great customer experience is one that features personalized service by several
workers for every customer.
A simple way of viewing experiences is to consider the function around which
your service is developed, and then consider the experience that a customer
gains from your service by adding “-ing” to the function.
For example, BMW sells cars, but their customers buy driving experiences. Ikea
sells furniture to customers who seek living experiences. Similarly, books
become reading experiences, food becomes an eating experience, and drycleaning
can become a healthy living, time-saving or money-saving experience.
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