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Product Price or Customer Experience?
Here is what customers value most
Alex Christidis & Iniobong Uyah
October 08, 2024
In partnership with
It would be best if you didn’t have to pick between pricing your products well or offering great customer service. However, product pricing can be tricky and depends on several factors, some of which could be beyond your control. This may sound not very encouraging, especially if you own a startup and are competing with more established companies with the resources to offer competitive prices to customers. Don’t be alarmed; there is a silver lining to all this. Although pricing is sometimes challenging to get right, a recent study has shown that customers look out for something else even more than the price of a product, and that is Experience.
Customer experience (CX) is the impression your customers have of your entire brand throughout all aspects of the buyer’s journey.
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PWC published a consumer intelligence insight that shed more light on the value of customer experience and why customers value it more than pricing. In the study titled “Experience Is Everything. Get It Right,” the company revealed that customer experience sits at the top of what consumers value most in a brand. According to PWC, if you give customers a great experience, they will buy more, be more loyal, and share with friends.
In a price vs. experience comparison, the study shows that one bad experience will cost a company or brand more than a premium price tag. On the other hand, a good experience boosts indulgent purchases even at premium prices.
“In the U.S., even when people love a company or product, 59% will walk away after several bad experiences, 17% after just one bad experience. 32% of all customers would stop doing business with a brand they loved after one bad experience. In Latin America, 49% say they’d walk away from a brand after one bad experience.”
Knowing this, one question comes to mind: What makes a good customer experience? Speed, Convenience, Consistency, Friendliness, and human touch
Once a customer puts out a request or gets in touch to report an issue or express a form of complaint, they expect a swift and purposeful response.
Speed
Customers want to see some urgency and superfast reaction toward completing their requests. Therefore, to run a successful business with strong brand loyalty, you need to prioritize speed, especially when a customer issues a complaint. Ignoring or delaying to attain customer complaints equals poor customer service.
Convenience—seamless transition from tablet to smartphone to desktop to human—is a baseline expectation. 43% of all consumers would pay more for greater convenience
Convenience
Convenience is when consumers find it easy to use your brand, such as having a great product design. Convenience (nowadays) is often associated with how well a brand leverages technology to give customers a faster and smoother experience. One thing to note here is convenience could be subjective and heavily dependent on the age bracket of your target consumers. Older generations may prefer a more traditional way of doing things. Keeping things simple would appeal to these types of customers. The younger generations are more trendy and technologically savvy.
Consumers increasingly show loyalty to the retailers, brands, and devices that consistently provide exceptional value and variety with minimum friction or stress.
Consistency
Inconsistency in business is a big turnoff to the customers. It shows that the business is not reliable, and reliability is one thing consumers look out for when choosing their favorite brand. Consistently providing your customers with a good experience will build trust and loyalty. In comparison, an inconsistent customer experience will build distrust in the brand.
Across all the industries surveyed, an average of 48% of U.S. consumers point to friendly, welcoming service as uniquely defining success in an industry.
Friendliness
Businesses, like people, need to be friendly and approachable. This trait is often portrayed by its customer service and sales/marketing departments as they are in contact with the customers the most. But it is also a factor in product design. Friendliness helps reduce friction, expedite conversations, and makes customers relaxed and at ease.
Human interaction matters now—and 82% of U.S. and 74% of non-U.S. consumers want more of it in the future.
Human Touch
As the age of AI sets in, the question of human touch in business becomes glaring. Are we going to be attended to by machines that might be fast and accurate but also emotionless? Yes, artificial intelligence has its perks, but there are also cons, and the more technologically advanced businesses become, the more the human touch will be sought after. The key here is to find a balance between humanity and machines. Using technology while still providing avenues for consumers to have real connections with human employees. Or improving automated operations to better provide human-like experiences to the consumer.
Consumers want better experiences when interacting with brands. However, few businesses prioritize consumer experience as it should be. A true understanding of what consumers want is not determined by experts in the boardroom but rather by interacting with consumers directly. The closer a business is to its consumers, the better its understanding of how to create the kind of experience that will build brand loyalty.
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Best Regards.
Alex