The arc of customer experience never ceases to amaze me. I get asked so many thought-provoking questions! This one I was asked recently seems so simple:
"Should I consider pricing part of the customer experience?"
In short, the answer is yes. But it’s really not as simple as it sounds. It’s simple enough to just experiment with your pricing based on the market, what competitors are charging, what sells, etc. But have you considered how your customers EXPERIENCE the pricing of your products or services?
Pricing IS part of the experience.
When I started 360Connext five years ago, I made a very deliberate decision not to have a set “rate.” My experience with what I do – consult, provide deliverables, speak, hold Touchpoint Discovery Workshops – has taught me that having an hourly rate doesn't make much sense to me or my customers. Charging an hourly rate seems to prioritize my time over the actual value of the work. It causes me to fret about how much time I spend on a specifically challenging deliverable (should I be charging more?) and it generally causes unnecessary tension in the experience.
This can get awkward, admittedly. Some clients think it’s important to know what 5 hours of my time is worth. I explain to them that, in all honesty, it depends. It depends on what we’re doing for those five hours. It depends on how many of my team members will be involved. It depends. But I think it’s better that expectations are made clear and both of us know what the total investment is going to be before we get started.
The clients I’ve been fortunate enough to work with over the last several years are the ones I select. And the pricing model – typically a service fee based on what we’re doing together, sometimes a one-off and sometimes a monthly retainer model – seems to work well for everyone. Are there months I spend more hours than others? You bet. Are there times I don’t need to involve my whole team? Sure. But this model allows me to provide what I think is the best experience for my clients and also helps me focus on what I need to get the job done.
Deliver a pricing experience that's right for YOUR customers.
My pricing model isn't necessarily the right one for everybody. I’m not highlighting it as advice. I’m simply pointing out that it's part of the entire experience I want to provide.
For instance, I add a customized message to my invoices each time I send one. This lets my clients know I’m always paying attention to the details. They know I’m aware of what’s coming up and that I’m always grateful for their business. It’s not the standard “Thank you for your business” line we see on so many invoice templates. It’s based on what we’re doing together, or a shared experience we may have had.
Pricing is tricky.
With products, it’s easy to get underpriced by emerging competitors these days. I see this happen often when companies are not watching the competitive field. The once-upon-a-time new guys (think Blackberry) suddenly come up for air to realize that others are offering products which are not only competitively priced, but better.
One of the things certain retail stores do best is display pricing in a way that feels like part of the experience. You don’t see Anthropologie or even Costco getting sloppy with the design and placement of their price tags, signage and other pricing materials. They are deliberately placed and integrated into the experience. Customers get the information easily and can make a decision more effectively.
Is pricing part of the customer experience? Absolutely. Have you considered how your pricing affects the experience you deliver?