DISQUS

Joseph Manna · 5 months ago

Scott,

I totally agree with you that if companies increased benefits, features and quality, they can still charge the same price if they got a quality product that delivers and exceeds consumers' expectations.

Perhaps, if nothing changes, why not offer a guarantee/warranty for an item that costs as much. It will help alleviate the pressure and minimize barriers in the customer's eyes.

Good point on providing value. That's the constant that weighs in most in WOM conversations.

~Joseph

nickgonzalez · 5 months ago

This seems very possible for companies that have a lot of play in pricing their goods. Apple has both dropped prices and increased benefit with their new line of computers and iphones.

I think this pushes the conversation toward enhancing products with low cost additions that add high benefits in context. Apple's developer platform is a great example. Relatively low cost for Apple, with a high benefit for users.

But how does this work for commodity goods?
How does General Mills increase value to defend cereal prices? Puzzles on the back of the boxes?

Lacey Haines · 5 months ago

Another great post, Scott. I work in PR. Shared with everyone at the company - looking forward to passing on to our clients as well. Per your line, "increasing benefit instead of decreasing price" - what would your advice be to services that are already free to the consumer?

measurevalue · 5 months ago

Great piece! Thanks, Scott! It is always those strong brands which will survive the price war.

triph · 5 months ago

I completely agree. Since purchasing a Ford Flex in January, at least two dozen people have asked me what I think of it. The conversation always starts with "Cool car. Do you like it?" Not "Cool car. Is it expensive?" My answer is all about value. It is not an inexpensive car, but is has benefits that other, even more expensive cars don't have, such as sync, and customizable interior neon lighting (my three year old loves that) that make the value story very compelling. The neon lighting certainly isn't an expensive option, but the perceived value is high.

Richter10.2 Media · 5 months ago

Wow, impressive posting, thanks for the info. :)

Ali Magnano
www.whywebpr.com

rogerewing · 5 months ago

Excellent insight. I am in the real estate brokerage business and I have determined that 85% of all our transactions are the result of a direct/indirect personal referral. Therefore, we are really in the core business of relationships, not real property sales which is a byproduct of our core relationships.

It follows that social media is the most effective and efficient means of maintaining relationships. Your graph indicating that 10% of our transactions are directly social media related is probably right on target. However, the relationships that drive our business are directly related to the social media spectrum overall.
Thanks for your post.

Mig Pascual · 5 months ago

Thanks for sharing the information. Interesting find. In this economy, consumers are more price sensitive. Good word of mouth builds trust with customers and if your business competes on providing the best service, you can have a loyal following that will come back to shop with you and be an evangelist for your brand.

Anuradha Khanna · 5 months ago

increasing benefits / talking more about benifits surely is a better idea. look at the plush five star hotels across the world. they offer amazing quality and no one questions the price. they smartly and gradually keep increasing the price and talk about the comfort, ambience and amenities. it works!

Tracy · 5 months ago

I work for a company that depends very much on word of mouth so this blog was very insightful. We have a small online advertising budget and that is all. One of my favorite things to do each week is go online and see what kind of comments people write about us, and about 95% say that they're going to tell their family and friends because they were so pleased with the outcome. You can't get better advertising that that!

Emily · 5 months ago

I think the quote from Cicero really hits this subject on the head. I agree that no matter what word of mouth tactics consist of, content needs to resonate with the intended audience or consumer base. There's a lot more to WOMM than people think and you really capture that here. Great post and very informative!

SEOcopy · 5 months ago

Very well said, always nice to see different perspectives. Sometimes clients don't even get the difference between a benefit & a feature. They want it all with a quart of Ben & Jerry's. :)

Promotional Products · 4 months ago

I love your equation, it is very true. Consumers determine value by how it will benefit them, and if it has already benfitted someone they know the perceived value goes up in their mind. WOM marketing just can't be beat.