Tag Archives: price

  • 0
commodity services

Commodity Services And The Race To The Bottom

Tags : 

Everyone wants a good price. In fact, everyone wants the best price. It is seldom that someone wants to spend more than their neighbor or competition for a similar product or service. Have you ever felt like commodity services are really a race to the bottom?

Price Strategy

Many selling efforts consider the basic economics of price. Sell more at a lower price and we’ll get more money. Sometimes this may make sense.

Selling services has some differences when compared with selling raw materials or products. The value of the product is in the spec. Anything meeting spec may only come down to one thing, price.

Services have some differences. Businesses that treat services like raw materials or products, pushing vendors for the lowest price as compared to spec, may get less than they expected.

Race to the Bottom

When you are selling a service that is based purely on spec you may be selling commodity services. Yet your value will be judged on the expected quality.

It will need to meet spec which includes quality, but the quality of a service subjective.

This is even true for most jobs. When you negotiate a salary, it typically starts with spec. Ultimately though you will not only be evaluated compared with spec but your performance will be compared with price.

One of the challenges for the service provider is to apply enough margin to consistently exceed expectations.

While everyone is racing to the lowest price and trying to sell more, the intuitive path seems to include cutting operating costs to keep margins. Service quality often declines. Promises are broken.

Commodity Services

One trouble spot with services is that they often aren’t remembered for price. They are remembered for the feeling after the service.

The best lawyers, surgeons, and accountants may have to meet spec, but spec isn’t that relative to price. The service promise and the resulting expectations have more relevance.

If you were in trouble legally, would you hire the cheapest attorney? The spec may be, have the credentials to practice law. The promise is to keep you out of jail.

Here is a promise. The cheapest service may meet spec, but it will often be remembered as an inferior product.

A race to the bottom.

-DEG

Dennis E. Gilbert is a business consultant, speaker (CSPTM), and corporate trainer. He is a five-time author and the founder of Appreciative Strategies, LLC. His business focuses on positive human performance improvement solutions through Appreciative Strategies®. Reach him through his website at Dennis-Gilbert.com or by calling +1 646.546.5553.

Dennis Gilbert on Google+


  • -
customer service voice

What Is Your Customer Service Voice?

Tags : 

Most of us have one, a voice that offers our opinions, expresses our values, and sets our desired expectations. Your voice may be more impactful than you realize. What is your customer service voice?

Internal and External

Keep in mind that customer service is both an internal and external part of your organizational culture. What is said, discussed, and believed is a big part of what sets expectations and creates outcomes.

Ship it anyway, the customer won’t notice.

I can’t find their telephone number on their website.

They completely rearranged the supermarket again, now I can’t find anything.

Your voice may be more powerful than you realize. What people say, even to themselves sets the expectations for future outcomes.

Power of Voice

When we believe the customer won’t notice, we’ll allow our work to have less quality. Believing that they won’t notice also signals that they don’t care. The belief becomes that they will continue to buy out of need, buy based only on price, or buy because they are sloppy or not frugal.

Certainly, the idea of fewer customer service oriented calls conceptually saves money. It removes the human cost. Similar to the auto attendant signaling us to “press or say one for sales, two for…” so that we are directed to the correct department.

The real problem may be that people are calling only after the website or help chat has left them with unanswered questions or additional frustration. Better yet is the system that demands your customer number, order number, or telephone, only to get a live person and have to repeat it all again.

When technology drives better service, when the investment is expensive enough to make it better, not cheaper, typically service will improve. Unfortunately, many efforts to remove the human factor are an immediate attempt to cut costs, not improve service.

The supermarket may measure profit and margins by what shoppers select and where they can find it. Single piece candy bars aren’t in the back corner of the store, that is where the milk, meat, and seafood is located.

The store may not care about the amount of energy required for your shopping experience, but they certainly want you see all the high margin items you can conveniently buy from them. In contrast, the e-commerce store allows sort, filter, and easy reorder, plus it arrives at your door.

Customer Service Voice

What we say, what we discuss, and most importantly what we tell ourselves and others will condition our expectations. This is our customer service voice.

When we believe that cheap is all that matters, that is probably exactly what we’ll get.

Perhaps our customer service voice should change. It may require more talk about what we buy being connected with what it is worth, not just connected with what it costs.

These are the businesses that are focused on doing what matters, not what is cheap.

They are out there. Their employees and customers both have the same voice.

– DEG

Dennis E. Gilbert is a business consultant, speaker (CSPTM), and corporate trainer that specializes in helping businesses and individuals accelerate their leadership, their team, and their success. He is a five-time author and some of his work includes, #CustServ The Customer Service Culture, and Forgotten Respect, Navigating A Multigenerational Workforce. Reach him through his website at Dennis-Gilbert.com or by calling +1 646.546.5553.

Dennis Gilbert on Google+


  • -
customer service value

Difficulties Are Customer Service Value

Tags : 

Habits are the basis for most of our work. Individually or organizationally, we tend to be creatures of habit. If we want to improve, we know the story of replacing bad habits with good ones. Do the challenges we face really create customer service value?

The path of least resistance may be the easiest one to follow. It may also be the most crowded.

Easy or Difficult?

Most people probably go for the low hanging fruit. It is the easiest to pick, uses less energy, and it may produce more than what we need or can consume. Organizations love low hanging fruit, and will pick it all day. They often end up in the path of the many.

It is hard to sell in a crowded market. Unique feels risky and is harder work, but it is probably where there is the most value.

When your business does more than what is average, more than where the crowd goes, and pursues beyond the low hanging fruit it may become unique.

In a service-based economy, where do you want to be positioned? It seems that standing out in a crowd may make the most sense.

Customer Service Value

The customer experience you create likely won’t provide great value when it is just like all the rest. Having exceptional levels of service will not be the path of least resistance, it is not picking only the low hanging fruit. Standing out will take resources, time, and will be difficult to maintain.

When we consider what is the most valuable, it is probably connected to what is scarce, not abundant. Being average is easy. It is plentiful and abundant.

Habits form the basis for our work. They are directly connected to the culture. If you want a culture that thrives in a service economy, you are going to have to be unique.

When you do the difficult work, you’ll stand out from the crowd. You may also be recognized as highly valuable, not because you are one of many, but because you are scarce.

What do customers see in a service economy? They often see little need for loyalty in a market where there is abundance.

Competing on price is a model. So is providing the most value.

– DEG

Dennis E. Gilbert is a business consultant, speaker (CSPTM), and corporate trainer that specializes in helping businesses and individuals accelerate their leadership, their team, and their success. He is a five-time author and some of his work includes, #CustServ The Customer Service Culture, and Forgotten Respect, Navigating A Multigenerational Workforce. Reach him through his website at Dennis-Gilbert.com or by calling +1 646.546.5553.

Dennis Gilbert on Google+


  • -
trusted not cheap

Why Your Brand Should Be Trusted Not Cheap

Tags : 

We live in an era where price is often the first question. Driving down costs is an important consideration, but to the manufacturer, distributor, or web sales kingpin is price what matters? Should your brand be trusted not cheap?

People often take pride in working hard for the lowest price. Drive to the cheapest gas station, shop at the store with the best coupons, and insist on free shipping. Society seems to like cheap and convenient, there are even bragging rights for those who achieve the lowest price.

We can argue about smart, but what about the business who offers cheap?

Owners, Managers, Employees

If you own a business, manage a business, a department, or team, or even if you place high value on your job or career you may want to consider the cost of cheap.

Businesses offer sales pricing, issue coupons, and even promote what they often call loss leaders. Does this work? Sure, sometimes it does. Is this how you want to build your brand?

Buyers respond, often in big numbers, the thought is that it is working, but for how long? How long will it be until there is a lower cost replacement? How long will it be until the buying opportunity for the customer is closer or on-line with free shipping?

At your job or in your career how long until the work that you do can be performed with a lower cost solution? Are any of these situations trusted?

Be Trusted Not Cheap

Many people and businesses push for the lowest price when with the lowest price often comes low trust.

Easy come, easy go, may be the best way to describe these actions. When there is no investment in the customer, there will probably be little investment in the employee, and when there is no investment in either of these the lowest price will win—until it doesn’t. Then everything changes.

The next time you’re shopping for lowest price, when you find it, ask yourself, “Do I trust this product, service, and the people?”

Trust your answer.

– DEG

Dennis E. Gilbert is a business consultant, speaker (CSPTM), and corporate trainer that specializes in helping businesses and individuals accelerate their leadership, their team, and their success. He is a five-time author and some of his work includes, #CustServ The Customer Service Culture, and Forgotten Respect, Navigating A Multigenerational Workforce. Reach him through his website at Dennis-Gilbert.com or by calling +1 646.546.5553.

Dennis Gilbert on Google+


Search This Website

Subscribe to Blog via Email

Enter your email address to subscribe to this blog and receive notifications of new posts by email.

Upcoming Public Events

  1. Managers Toolbox Event – Williamsport

    October 2 @ 8:00 am - 5:00 pm
  2. Developing Middle Managers : Part 1

    October 16 @ 8:00 am - October 18 @ 5:00 pm
  3. Bridging the Gap Event

    October 24 @ 8:30 am - 4:00 pm

Blog (Filter) Categories

Follow me on Twitter

Assessment Services and Tools

Strategic, Competency, or Needs Assessments, DiSC Assessments, 360 Feedback, and more. Learn more