It is no wonder that in today’s wood flooring marketplace 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.
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It is no wonder that in today’s wood flooring marketplace 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, another bag of rice and another 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 résumé 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 to 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 someone they trust. When your customer begins to trust you, it’s essential that you have a thorough understanding of their lifestyle. 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.
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 customer’s 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. This is also an example of 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 air miles 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 make 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.
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.
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Michael Vickers is the executive director of Summit Learning Systems, a company that offers customized in-house training and e-learning programs to many of today’s leading companies.