As business owners, we instinctively know that trust is essential to our success. The day we lose our customers trust is the day we lose their business. Game over! End of story. So how do you go about creating this trust and where does your pricing fit into that trust-building strategy?
The reality is that pricing can enhance (or lose) a buyer’s trust in your offerings, but it can’t create it. Why? Because a price, without the context of value, has no meaning. In my blog post, The Dangers of Cost+ Pricing, I used a milk example. To families with young children milk has a great deal of value, to those who are lactose intolerant it has no value. What that means is that we have to lay the contextual framework for our pricing in order to build trust. How do we do that?
It begins with a clear customer profile. If we’re selling whole milk our customers are family with young children, not the lactose intolerant or seniors who are trying to remain heart healthy and stroke free. Once we’ve profiled the customer it’s much easier to create a clear brand promise – a result that the customer can expect.
What result do these families want? Healthy physical and mental growth and development for their children. Once we understand what’s important to our customers, what they value, we can shape our offerings to provide that value. Communicating that brand promise in a tagline is the first step in creating the value context for customers to later assess the price. That leads to the second phase of communicating value – our marketing messages.
To create an effective marketing message we need to keep our brand promise, healthy growth and development, as the focal point of our messaging. When we stray, as many companies do, into areas of what we do or how we do it, we lose buyers’ interest and their trust. Why? Because we’re no longer speaking to what’s important to them – the promise our brand made to them.
When we focus on our company or our products instead of our customers we, in essence, tell them that we’re more important than they are. Who among us trusts someone who puts their interests ahead of ours? You have only to contrast the experience you had in dealing with a salesperson who was genuinely interested in helping you make an informed decision with one whose interest was in making a sale to know that what I’m saying is true.
That brings us to phase three of building trust – the sales experience.
Whether your involved in face-to-face selling or using point-of-sale devices, your message has to support the message the customer has received in your brand promise and marketing messages. You can feel the trust building, can’t you? The more consistent the messaging, the greater your customers’ confidence in the product or service you’re offering. It’s human nature, we trust consistency just as we tune out messages that overwhelm us with irrelevant information or, worse yet, offer conflicting information. That brings us to pricing.
Once we’ve created a clear value context with our brand promise, marketing messages and sales scripts (materials), we want our pricing to reflect that value. If we price our offerings too low in relation to the value, we lose buyers’ trust. Conversely, pricing that reflects the value provided enhances customers’ trust in our offerings. That’s why I said at the beginning of this post that pricing can enhance (or lose) trust, but not create it.
Not only will these four phases of building trust – branding/marketing/sales/pricing – help you attract and win more value buyers, it’ll help you build a more successful business. Through this process you define and communicate your value system for all the world to see. Workers who share your passion for these values will want to join your company. Vendors who appreciate your values are also going to prize their working relationships with you.
You don’t need much of an imagination to see how much more fun running a business can be when you’ve surrounded yourself with people who share your passion, interests and values. It all begins with knowing how to build trust with prospective customers. Now you have the formula to do just that.
Do you have a clear brand promise? Find out by using my confidential Brand Promise Self-Assessment.
Are you getting compensated well for the value you provide? Use my confidential Pricing Self-Assessment to evaluate your company’s pricing.
Are your marketing messages attracting the right customers? If you’re getting primarily price buyers you may want to use my confidential Marketing Self-Assessmentto discover why.
Is your sales force putting pressure on you to lower prices? Our confidential Sales Self-Assessment can show you why.
If you’d like to increase your prices, profits and customer base, call Dale at 314-707-3771.