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When traveling, have you ever searched the internet extensively to find the cheapest hotel room? If you found a place 30 yuan cheaper than others, wouldn't you feel delighted?
But think calmly: it's only 30 yuan cheaper. Did you really spend hours in front of the computer just to save that 30 yuan?
In fact, customers enjoy the feeling of a 'sale' or the game of 'even if it's only 30 yuan cheaper, I must find a cheaper place,' not genuinely saving money.
Of course, not 100% of customers enjoy this game, as some genuinely want to save money.
So, how are these people distributed?
We can use the so-called '2-6-2 rule' to explain. For example, worker bees, often seen as industrious, are said to have 20 out of 100 that are very good at working, 60 with average ability, and 20 that are lazy.
Consumers are similar: the top 20% are those who 'never buy discounted items,' the bottom 20% are those who 'only buy discounted items,' and the middle 60% are those who 'buy both discounted and regular items,' playing both sides. 'High-spending customer marketing' targets the top 20 and the middle 60, totaling 80 people.
How to capture these 'both-sides' customers is the essence of high-spending customer marketing.
Incidentally, since the bottom 20% who only buy discounted items believe 'cheap is everything,' they will gradually leave after you implement high-spending customer marketing. But don't worry. Based on my experience, this group not only likes bargains but also tends to 'demand twice as much as others.' Therefore, if you completely get rid of this group, you can save effort dealing with unreasonable demands or complaints, which is a cost saving in time and spirit. Some might argue: 'You say it easily, but our products can no longer offer more value to consumers, so we can't possibly raise prices!' Don't worry; I'll tell you how to make consumers feel an increase in value without changing the product content. Psychological Traps That Prevent Higher Prices Trap 1: Afraid to Raise Prices 'I dare not raise prices' is a common situation. Such business owners seem to strongly feel that 'raising prices is bad for customers.' Indeed, no customer is happy to hear 'prices have risen,' and an unjustified price increase is not a good thing. However, if you think long-term for your customers, you should actively and moderately raise prices. Because to continue providing excellent products, you must earn appropriate profits and then reinvest those profits to enhance the added value of your products. If you keep discounting until you can't sustain it, you might end up cutting corners and harming customers. If you truly hold this belief, you won't feel guilty when you raise prices moderately. Trap 2: Explanations Become Too Technical Manufacturers try hard to explain so customers can feel the value, but sometimes no matter how they explain, customers just don't get it. This is often because the explanation is too technical for customers to understand. Based on my experience, what manufacturers think is 'easy to understand' is actually about 10 times more difficult than what the average person can comprehend. Therefore, reduce the difficulty by 10 times so customers can understand. Similarly, only by further simplifying can you clearly convey the product's value. Note: it's not that customers can't feel the value; it's that the explanation is too hard. If you lose customers for this reason, it's a pity. Trap 3: Assuming 'Same Product, Same Price' Many ask: 'Since the products are the same, don't we have to reference competitors' prices to some extent?' Not at all. The reason is simple: if you create added value, customers will see your product as completely different from others. For example, a bottle of cola sells for 2.5 yuan in a supermarket, but at McDonald's, a cup of cola with water, ice, and less quantity sells for 5 yuan. Although both sell cola, customers' needs are completely different. Remember: customers come to your company because they want to 'hear a story,' 'dream together,' and 'learn new ideas.' Once you understand the added value of your product, you'll see there's no need to be constrained by the same price. Trap 4: Unknowingly Recommending Cheap Products Indeed, from the perspective of 'reducing customer spending,' recommending cheaper products makes sense. But do customers only want cheap? Suppose you're hospitalized for a disease and need surgery. The surgery comes in three tiers: 'premium, 100,000 yuan,' 'standard, 70,000 yuan,' and 'basic, 30,000 yuan.' If the more expensive ones are less painful and have fewer aftereffects, which would you choose? I would choose the 100,000 yuan tier without hesitation. Of course, if I couldn't afford it and couldn't borrow money, I'd reluctantly choose 'basic.' This shows that customers don't just want cheap. Regardless of the customer's budget, it's important to carefully explain and confidently recommend products based on your expertise. If after the explanation, the customer still chooses the cheaper option, then there's nothing you can do. Remember: it's not about being cheap; it's about meeting the customer's overall needs. Trap 5: Always Targeting the Wealthy 'Unknowingly, I only recommend products to customers who look wealthy.' But as mentioned earlier, even wealthy people don't buy things they don't need. On the contrary, less wealthy people will try hard to buy what they want. Of course, from the 'want' perspective, wealthy people are more decisive because they don't need to bargain. So, it's okay to target the wealthy. But if you only focus on wealthy customers, you'll miss many opportunities. For example, it's increasingly common for young newlywed office workers to buy a house with a 30-year mortgage without a down payment. There's no causal relationship between 'having money' and 'feeling a product has value.' Wealthy people just make decisions faster. Therefore, you should deeply realize that the simple idea 'only the wealthy spend money' will make you lose many sales opportunities! Click the image for details The 3rd (CFIC) China FMCG + Internet Conference will be held in Chongqing in October 2017. At this conference, New Distribution has invited 1,000+ distributors, 500+ brand owners, founders of 200+ B2B platforms, and 100+ investment and financing institutions to participate. The theme of this conference: New Forces, New Ecosystem. We will invite well-known B2B industry experts, mentors, and B2B platform founders to discuss the following topics: Core Topics of This Conference:
How the FMCG industry can achieve new growth opportunities through B2B
How to build a new supply chain behind new retail
How intra-city logistics can help B2B achieve leapfrog development
Highlights of This Conference:
The industry's first '2017 China FMCG B2B Industry Competitiveness White Paper'
Case studies of excellent distributors in transformation and upgrading
Upgraded conference + exhibition, with Hall 6 Internet Technology Expo strengthening networking
Leaders from Alibaba Retail Link, GL Capital, Eternal Asia Supply Chain, Best Store Plus, Yijiupi, Unilever, Hdtech, Yunmei Co., and other well-known companies will give speeches and share pioneering views.
October 17-18, 2017 Chongqing International Expo Center Registration is now open. Long press the QR code below or click 'Read Original' to register. Early bird tickets before September 15 enjoy a 30% discount! Add friend and note 'Conference Registration' Click the links below to review the highlights of the 1st and 2nd FMCG + Internet conferences: 2016 'FMCG + Internet' Summit Forum 2017 (2nd) China FMCG + Internet Conference Click the links below to review the highlights of the 1st and 2nd FMCG + Internet conferences: 2016 'FMCG + Internet' Summit Forum -END-