Have you ever been in the situation where you received ‘a bill’, already feeling slightly sick at the thought of having to pay good money for an experience that failed to meet your expectations? It is unlikely that you have never faced the scenario where you paid for a product or service in the early stages of an experience, only to feel ‘short changed’ or ‘extremely disappointed’ by the time you decided to end the very same experience! How many times have you been enticed into an experience by something that promised so much, only to realise that your perception of what the experience is actually worth is very different to reality?
I am guessing that anyone reading this will be able to empathise, sympathise or recognise these differing scenarios. I hope I have not helped to conjure up any bad memories! Sadly, all too often, the customer ends up paying for something that quite frankly does not live up to expectations. Just at the end of December, the Golding’s had a lovely break at a ‘luxury family hotel’ (their words, not mine) in England. The break was lovely and very welcome. HOWEVER….. there is always one of those…. what we PAID for the experience was absolutely not in line with what I would have expected for the price.
When I conducted my first independent research in 2013, I identified that ‘value for money’ was the Number 1 thing that customers want from an experience. Failure to deliver ‘value for money’ will damage customer perception and potentially the sustainable growth of your business. The EXPERIENCE the Goldings received from the ‘luxury family hotel’ was NOT good value for money. Would I recommend the hotel to others – possibly – but not before I advised them that they would be paying far more than the experience is actually worth.
Value for money is very much down to PERCEPTION – it is not just about the absolute price. If you flew with Ryanair a few years ago and paid a very small price for the privilege, you just did not expect to get anything more than a seat on an aircraft getting you from a to b. As a result, Ryanair to a degree were always the great example of delivering ‘value for money’.
So let me ask you this. Do you think that your organisation delivers an experience (not just a product or service) that is good ‘value for money’? You may already ask your customer this very question in your customer feedback survey. Even before you dig into the research to find out what customers actually say, have a think about this fundamental question:
If you were to offer your customers the chance to do one of the following things, what would they do?
- Pay the listed/advertised price
- Pay MORE than the listed/advertised price (recognising that the experience has gone above and beyond expectation)
- Pay LESS than the listed/advertised price (recognising the experience has failed to meet expectation)
It is an interesting question – what do you think the answer would be? The potential answer may be quite scary – but one that would give you a hugely powerful insight into how your customers FEEL about their experience with you.
I regularly visit restaurants where the experience is so good I choose leave a handsome tip – that is an example of ‘number 2’ of the three options. I will also sometimes not leave a tip at all – on occasion, where something has gone badly wrong, an amount will be removed from my bill – an example of ‘number 3’. However, most of the time, I end up just paying the listed price – even if the food was bad. The key to all of this is that then I pay the full price for something that fails to meet my expectation, I am very unlikely to return.
Usually, when an experience comes to an end, the customer is asked ‘was everything ‘ok’ with xxx sir/madam’. I have never been too keen on this often insincere/mechanical statement – if I say NO to the question, it is very unlikely that anything will ever come of it. So how about we consider a world where ‘the bill’ looked a little like this:
Now it would be one BRAVE organisation that would be prepared to do that. Let your customer take control and pay what they think the experience was WORTH! Would they pay you more; or would they pay you less?
I very much doubt that many organisations would choose to do what I am describing above – unless you are extremely confident in the ability of your business to deliver the experience that your customers expect, the fear factor will be far too great. However consider the question going forward – do my customers think the experience is worth the money they are paying? This is a question you SHOULD absolutely be asking – I wonder what the answer would be?
Many thanks for another blog which certainly makes you think.
Brunel’s hammer, Radiohead’s In Rainbows and Edison’s Universal Stock Ticker spring to mind that the reward is very much based on the value to the buyer.
I’m always impressed with honesty boxes. Whenever I’ve taken a book from outside a charity shop or stopped and picked up veg from a table outside a farm house, the honesty box (to which I of course contribute) has already been furnished – which restores my faith in buyers paying for what they value they get.
However, given the complexity of the buying decision it’s a challenge to accurately reflect the cost you should pay sometimes. I recall a few years ago my father-in-law fashioned a replacement catch for a Bugaboo buggy we had out of an old plastic buckle he had – it worked perfectly and didn’t look out of place. But was shocked when we thanked him by paying for lunch out. It had only taken him 15 minutes and cost nothing, but the replacement piece – which was attached to a larger more expensive component – would have cost us over £50 at the time.
Whilst we haven’t tried what you proposed I do have an example from not too long ago where a client said given the work we completed for them, they would be prepared to pay double what we charged in consideration of the usefulness of the delivery we produced.
I’m glad to say the story doesn’t end there. They recently commissioned us again and reminded us that this time we would be paid twice the rate as before for the work which we have been appointed to complete.