Connecting the Dots / An Agency Blog

The theory of value is subjective. In regards to a product or service, value must be useful in satisfying the wants and needs of the consumer, we’ve also seen value generated when something is in limited supply. While this idea holds up in the comparison of two products side by side, it does not induce a desire of want in the customer who is inundated with hundreds of choices for nearly the exact same product or service.

As if things weren’t difficult enough. The current downturn in the economy that we find ourselves in has made the task of providing consumers with value an even more arduous process than it was in the past. We’re all trying to be a bit more cost conscious, so companies have been employing the reactive and misguided strategy of slashing prices in an effort to gain new customers. While this might produce a short-term gain in sales, it also has the ability to damage long-term customer relationships, which can be a legacy more problematic than a recession. This holds true especially when the economy stabilizes and businesses are forced to raise prices. What else is a company to do then? How does one go about creating value within a market economy that is currently suffering? The answer is two fold: market to your current customers and provide the best possible customer experience for those customers. Raise the bar, set your brand apart from the competition, and provide a valuable experience that will return customer loyalty in any economic situation.

Traditionally, retailers have used technology and the Internet as an extension of their offline advertising initiatives. Branded messages were pushed to the consumer en mass via whatever marketing channels were available to them. Because of this, advertisers had to rely on casting a large net to get their conversion numbers in order to make sales, creating a watered down branded experience. It was, at best, a chance game of numbers with the hopes of a windfall. Today’s climate finds us in the mainstream adoption of conducting business on the web. Brands can now not only sell to their customers, but also engage in two-way conversations with them, creating new ways of enriching the everyday lives of those customers. When consumers are met with this type of experience from the organizations they are patronizing it creates value, and value creates loyalty. Spending money in a loyalty/value situation becomes more complex than the obvious “cheapest price wins” game. When comparing Brand A vs. Brand B – a consumer will most often spend in favour of value or loyalty. Price becomes less of a factor in this kind of situation, so as a brand why would you focus on it?

To see this example in a real life context, let’s look at the formidable task of shipping a package using the web. Once you have entered all the necessary information, you have to then approximate the size of the parcel needed for your package, a component of the process that’s unavoidable no matter the provider you happen to be using. The US Postal Service identified this as an opportunity to set itself apart from their competitors by developing the Virtual Box Simulator tool that allowed users to quickly identify a parcel size by using a webcam and a piece of paper. This Augmented Reality tool, while easy to use, had never been utilized outside of an entertainment context and helped to make the experience of shipping a product through USPS superior to that of another brand.

The intrinsic benefit of creating value through superior user experience is that, given the tools and opportunity, your customers will pass along a brand’s value proposition for you. This year, Engine Digital was approached by an online retailer of contact lenses to rethink, in an online context, the experience that a customer has while buying eyeglasses. When our client made the decision to start selling eyeglasses online they identified that most people look to others for guidance as to which pair looks best in accordance to their personality and physical attributes. The Internet is now capable of creating this bring-a-friend experience into the shopping paradigm. What we ended up developing is an application that allowed customers to not only virtually try before you buy but bring an entire community along for advice in the purchase decision. This type of experience is referred to as Social Shopping. Customers can snap a picture using their webcam and superimpose the full inventory of eyeglasses onto their head. Once the selection of eyeglasses were narrowed, a customer can solicit votes and comments from peers within their socialsphere by way of a Facebook Application, Twitter, Blog Widget, and Email. Let’s be fair, uploading your picture isn’t particularly new, but what we focused on was to provide the customer with the tools needed to make purchasing eyeglasses online comfortably. Not only was this helpful allowing the customer to enlist their friends in influencing their purchase decision, but it also put the company’s image in front of people who may have never come in contact with the brand. This initiative is, in my opinion, of greater value to the company than just a well designed website could ever be.

In a downturn, good companies can become better by investing in valuable lasting impressions. This helps retain their existing customer base and gain new customers from competitors who have slashed customer experience alongside their prices. As the economy rebounds (and it always does), those brands that have prepared by building stronger relationships with their market typically come out swinging – those that haven’t are quickly forgotten.

(As published in the Fall 2009 issue of BCAMA Marketline Magazine)

Similar Posts:

• Will Average Internet Users Say They Binged.It?
• A Deeper Way to Think About Branding
• Mobile, and The Quest for Brand Affinity
• Novelty vs. Utility: Can Both Coexist in The iPhone App Store?
• James Riley named Partner & EVP Client Services at Engine Digital