“It’s got Nothing to do with Price”
By Conor Kenny, Teacher, Trainer, Writer, Founder of conorkenny.com
There is a very useful saying about the man who knows the price of everything and the value of nothing.
If you are engaged or engaging in a "It's all about price strategy" can I gently suggest you close the door, turn off the lights and hang the 'Shut for Business' sign outside?
It has nothing to do with price. It has everything to do with value.
The two must not be confused.
In the hotel business, I hear 2 common cries. The first? You guessed it "It's all about price"
The second "Our business is for everyone"
Both are strategies that will take you fast, furiously and deep into the darkest recesses.
So what is 'value'? In my thinking, it is simply a price I am happy to pay for what I got.
Discounting is a bad deal for both the buyer and the seller. Neither ends up with a benefit. One loses margin, the other simply gets a mental victory.
There are two solutions.
First, you must understand the drivers and why people buy. These are emotional need states. It might be a first date, a funeral, my Dad's 80th birthday, my Mum's anniversary. The list goes on.
What I need determines what I buy. What I buy has to fulfill my need. Great sales match both.
Second, you are not, nor will you ever be for 'everyone'. You need more of who like you and less of the bargain hunters. That comes down to a few really important questions such as:
- What do you offer?
- Who for?
- What do you have that makes you different?
- What makes you unique?
- What is the personality of your business?
- Why you?
Your answers ought to begin with "Because…."
If you know who you are targeting your marketing needs to talk to your fans. If you are a 4 star Hotel entertaining the discount conversation with the B & B client you are wasting time, energy and fuel.
Instead, you need to be talking to lovers of 4 star hotels and asking B & B lovers to gently pass by.
Next, your marketing, once you know I like 4 star hotels, needs to talk to me, communicate me and inspire me.
Does it? Do you? Don't be surprised if you fail if you don't.
Lastly, create a list of high impact tradables rather than discount.
At a recent Ideas Factory we ran I remember a very simple example.
The aggressive client wanted discount. The hotel were about to cave in. A young manager bright eyed and bushy tailed intervened. He said;
"Sir, if I give you £20 off you don't actually get anything. Instead, I'll charge you the £100 but it is my pleasure to give you the golf buggy – normally £50 a day – with my compliments"
That's what I mean about high impact tradables.
Much better use of your time to go make a list of high impact low cost things you can do to make sure everyone wins benefits and stays happy.
That's why it has nothing to do with price and everything to do with value.
Conor KennyMore from Conor Kenny
At Conor Kenny & Associates we start with one simple belief - "that your people are better persuaded by the reasons they have themselves discovered than by those which have come into the mind of others". Our business is your business, where exceeding expectations, maximizing performance and effective communication are all in a day's work. We may be known for doing things a little differently but our aim is simply to bring out the best in your business. But don't just take our word for it, browse through our site, look at who we work with, read a few articles and see what our clients have to say. Then, if you like, get in touch and see how we can help make your business...better.