June 30, 2009
BE DiFFERENT marketing: create packages of value for the individuals you have chosen to serve rather than flogging products to the masses.
Value Paks are created based on what you discover to be the total overall needs, wants and desires of your targeted customer group.
They reflect a broad customer dimension rather than a narrow thin slice that typifies a product-driven approach.
They place an organization in the VALUE delivery business and not the product supply business. The Mountain Adventure Package offered by the Fairmont Chateau Whistler, for example, creates an adventure experience for people rather than merely a combination of a hotel room + food + a daily Whistler activity (of which there are well over 30 to choose from).
Value Paks are priced to reflect the value supplied; they are not based on discounting the sum of the component parts as is commonly done today in the plethora of bundles being provided by many companies. As a result, margins are not eroded as in discounted bundling; rather margins are increased if the marketer is astute in the value components being provided.
Here are some of the organizational benefits to the packaging strategy:
- Companies are viewed as creative - looking at the customer as a total entity
- They are viewed as market leaders - few offer more value for premium prices. Most are in the discounting game.
- Their brand currency goes up - based on innovation and market leadership
- Their customer relevance increases - Paks are based on specific customers rather than on the general needs of mass markets
- Margins increase - based on premium pricing not discounting
Value Paks are not bundles. They are created based on value components discovered to be unique to a specific customer group.
They are sold on the basis of a singular value proposition that integrates all package components into an expression of value (the Mountain Experience Package). They are priced up based on relevant and compelling value provided.
Bundles are old and tired; everyone uses them under the misguided belief that they create customer stickiness or loyalty. How can that be the case when they are nothing more than price plays and there is a glut of companies in the market that provide them?
The argument doesn’t cut it with me.
Check out my BE DiFFERENT or be dead Book Series
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BE DiFFERENT #marketing practice: discover customer “secrets”
BE DiFFERENT #marketing practice: institutionalize customer learning
Why don’t we have a Customer of the Month award?
- Posted 6.30.09 at 11:37 am by Roy Osing
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