Friday, May 24, 2013

You do not need to be cheaper to win customers, but you do need to be smarter!

I often read Facebook posts or have discussions with delegates on training courses about how to be competitive when pricing their goods and services, especially when those around you are selling the same balloons as you but cheaper than you do? 

It can be very frustrating when you have calculated your selling price (I recommend using the Job Cost method as taught in the QBN program or on some Qualatex Courses) and find that your price is greater than those around you. 

I do not agree with starting price wars or even suggest that you lower your prices to be cheaper, this is never a smart move, but I do have a few idea’s that you might like to try out?

Usually pricing becomes an issue when you are selling like for like items, that makes it easy for a customer to compare pricing. 

I just did a little research and ‘Googled’ 3 balloons on a weight, I only used this example because so many balloon companies sell 3-balloons on a weight and therefore that is what customers are likely to ask for! 

I was amazed at the different prices that appeared, but should I have been amazed? No, not really, in reality I should have spent more time looking at what each company was offering to determine why there was such a vast price difference, but lets face it do our customers do that or do they just look for the cheapest price?

You truly do not need to be cheaper to win customers, but you do need to be smarter!

My first tip is to be creative, this means being creative both with your design skills and in the way that you describe your work! I have often said that you need to give designs names, but also the way that we describe our balloons can have an impact too!

Let’s look at the example product that I first looked at, so do we sell 3 balloons on a weight or do we sell...

3 beautiful helium filled balloons on a coordinating weight, perfect for both parties and weddings.

Automatically these words are fulfilling the customers needs or at least one of them, which is balloons that will look beautiful at their party. Let’s face it, a customer is not looking to buy 3 balloons on a weight,  they are actually looking for what the balloons will do for them, which is to decorate an event or function to make it look nicer!

So the lesson here is to use descriptive words that will help a customer conjure up a picture in their mind and that will fulfill a need.

Beautiful, elegant, stunning, fun, sophisticated, trendy, unique, also words like top quality and long lasting work well too!

It’s a great game working on your descriptive words... build on them and make sure that you are comfortable saying them on a daily basis, otherwise there is no point using them because I can assure you that you wont!

Now when it comes to like products, why not be different or offer alternatives, maybe with some add-on’s or extra features? I personally think that for every design we have we should have say 2 or 3 pricing points. I have to confess, I really struggle to find names to describe each level, how about selling basic, standard, or superior balloon arrangements? We can use each term to give us the opportunity to upgrade and offer that little bit more! In fact it has been proven when a customer has a choice between three pricing points, they generally choose the middle one, that gives you the opportunity to sell your standard design at a higher price than your competitors price, but still have an option of selling a basic version at a similar price if necessary?

So lets return to our 3 balloons on a weight and look at how we can up-sell too!

"Here at Amazing Balloons we can supply 3 beautiful long lasting helium filled balloons using the very best balloons on a coordinating weight, that are perfect for all special occasions, we can also add a very pretty hand-made bow at a small additional charge that will enhance your balloon arrangement even further".

Here we are telling the customer that our balloons are beautiful, long lasting, using the best quality products with a coordinating weight, that will be perfect to enhance their special occasion. We are also suggesting that we can make their balloon arrangements even prettier by adding a hand-made bow.

As a consumer, we buy according to our emotions, ‘what’s in it for me’, ‘what will it do for me’?

We don’t buy perfume, we buy into what the perfume will do for us... it make us feel and smell great, sexy, fresh or sensual!

We don’t buy a vacuum cleaner, we buy the fact that in our home we will have lovely fresh, clean carpets!

It really does not matter what the product or service we are selling there are always benefits that we can ‘sell’ to our customers!

I strongly recommend an article written by Chelsea Gaspard, CBA, QBN Director, Pioneer Balloon Company in the Jan/Feb/March 2013 Balloon IMAGES magazine, page 43.
A Valuable Lesson- Profit IS why you are in business. Isn’t it? 

Happy Ballooning!


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