The Price-Value Experience Thing

Yet another edition of “Interesting Research That Proves What Common Sense Told You.”

Image representing Forrester Research as depic...

Image via CrunchBase

In this case, however, the results are actually surprising in that they do confirm one’s own thinking.  The study comes from Forrester, who tested the relationship between customers’ perceptions of their experience, their perceptions of price-value, and their loyalty. This report shows how customer experience trumps price-value perception as a loyalty driver.  In other words, we don’t mind paying a couple of dollars more for a better customer experience.

Media Post summed it up this way:

New research from Forrester finds that when it comes to building loyalty, people respond more to the experience they have with the retailer than with their perception of price.

They went on to quote Maxie Schmidt-Subramanian, the analyst who wrote the report:

In order to move the needle, she says, stores need to focus on the core components of positive experiences, including:

* Meet customer needs. “If the product or service is wrong, price becomes irrelevant,” she writes.

* Make it easy. That can include anything from keeping store aisles clear to making it possible to start shopping online, and then still find the items in your cart when you switch to mobile. “Amazon’s two-day shipping and one-click ordering continue to make a strong impact on shoppers,” she says.

* Make it enjoyable. “That comes down to basics, like making sure dressing rooms aren’t messy and that it’s not a hassle to use your coupons.” And stores like Trader Joe’s, QuikTrip, and Costco may be low-cost, she says, but the amount they spend training their employees to be more knowledgeable makes the experience more pleasurable.

Well, yeah!  Businesses often spend way too much time trying to shave costs while persevering margins.  Intuitively, getting customers to pay a bit more can more than amortize the costs of excellent service, particularly when that service doesn’t involve any more staff, but better training and higher responsiveness.

Maybe this isn’t learning something new today but I think it’s always good when we get reminded of things we probably already felt.  What do you think?

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