As you have no doubt already noticed, my Blog posts and those of many other Bloggers too, are often prompted by real-world experiences. This week is no exception.
I want to share with you some examples of how companies jeopardise the loyalty of their customers and also seriously limit their chances of getting repeat purchases. But manufacturers aren’t the only guilty party; there have been some interesting comments on retail loyalty as well these past few weeks, so I will touch upon that too.
Promising More than the Customer Gets
This week I bought a new brand of bacon; I fancied a real English breakfast for once. When I opened the pack up, I was shocked to see that under the first three or four deliciously lean slices, was a pack of rather fatty, poor quality meat. Now why would a company do this? To make the sale of course. Seeing such great quality you would rightly expect the pack to contain similar meats to the front slices.
Another example which uses a similar ploy involves packaging. How often have you been enticed into buying a new product because of the picture on the pack? Or perhaps it was in an advertisement showing a delicious-looking meal or an amazing improvement to the skin or hair? Sometimes the pack content or product result may be acceptable, but when it’s not, you’re disappointed rather than delighted, aren’t you? (I previously wrote about one such experience in a post on brand honesty here) Again, why would a manufacturer set themselves up to deceive the customer into buying – once?!
Are such behaviours customer-centric? Certainly not! They are deceitful tricks used to sell customers less than they were led to expect. Yes you may get the sale, but you won’t get repurchase and certainly not loyalty. Which do you want? One, several or long-term purchases?
Raising Prices without Saying so
Most major markets have seen low rises in their CPIs (consumer price index) in 2014 with Switzerland actually in the current situation of a deflation! However that hasn’t stopped several manufacturers from increasing their prices. Or should I say decreasing the content of their packs, as that seems to be the more usual response of many of them? This is not a very customer-centric approach to pricing.
The shopper is buying the same brand at the same price, but the contents, which the consumer rarely verifies, have decreased. If the reduction is significant, consumers may notice that the pack is significantly larger than the contents inside, which may then prompt them to check the actual weight they have bought.
A recent article in the UKs “The Telegraph” talked about some of the most noticeable offenders, including Birds Eye (Pirmira’s Iglo Group) and Twix (Mars) candy bars. However many categories were using the same method of hidden price rises.
A survey of 1,257 UK’s Which? members found that over half (58%) said they would rather prices rose than packs got smaller. A further 37% would rather the pack shrank, but only if they were told. (>>Tweet this<<)
Mandatory Sign-ups for Free Products
There are hundreds of new offers on the internet every day, trying to entice new customers to “try before you buy”. However some sites demand mandatory sign-up to the paid program before allowing their customers to test their service. Credit card details and other personal information is requested, supposedly to “help the customer to subscribe more easily” should they decide to buy after the trial period.
However there is also most likely an automated transfer included from the free to a paid service should the customer forget to cancel in time. They then find themselves in the situation of buying a paid suscription without full knowledge of it. Is this customer centric? Of course not. If a customer decides to buy, he would be much happier to provide the necessary information to do so at the time of purchase. Again, you may have sold one more membership, but are extremely unlikely to get a happy or loyal customer.
Cheap isn’t Always Less Expensive
More and more airlines and hotels are selling their services “on the cheap” or at least that’s what it looks like. However, when you start adding on the extras, those attractive prices don’t seem quite so cheap anymore.
Take a low-cost flight for instance; in Europe that would probably be with Ryanair or EasyJet, and in the US with SouthWest Airlines or JetBlue. In addition to the cost of the flight, you will often pay for hold luggage and sometimes carry-on items too, as well as food on board, priority boarding, seat reservation, pillows, blankets, headphones and even entertainment.
Hotels will add on charges to guarantee bed type, taxes, WiFi, breakfast, gym use, bag storage, resort fees and even mandatory gratuities.
Retail advertising and promotions are other areas where shoppers need to have their wits about them and a calculator on hand. The old adage that bigger is better no longer seems to apply. If several sizes are offered purchasers really need to check prices per 4 ozs or 100 gms. The BOGOF (buy-one-get-one-free) and BOGO promotions can also sometimes work out more expensive than buying one pack at the usual price charged.
One of my favourite promotional ads of all time is one I photographed in the UK at the local Pound Store, the equivalent of the Dollar Store in the US. See the photo above. Now that really is a bargain!
Consumers are Getting Wiser
The above are just a few examples of “tricks” that manufacturers and retailers play on their customers. It’s almost as if they are trying to see just how far they can go before their clients notice. Well, I think we have noticed, and this is confirmed in an article on CMO.com that caught my eye last week. It mentioned a panel discussion at the National Retail Federation’s Big Show in New York City. Faisal Masud, Staples’ chief digital officer and EVP of e-commerce, who was part of a panel discussion at the event, made the following comment:
“Consumers are agnostic to where they shop. The days of window shopping and just paying the price you think is fair are gone. A lot of folks don’t even want to interact with people or companies. They just want their goods fast and at the lowest possible price. For that reason, a lot of the retail loyalty programs are a little bit doomed.”
I would add that a lot of brand loyalty will go the same way if practices such as those mentioned in this article continue. I believe these behaviours are short-terms acts of desperation of a losing brand. In fact I spoke in detail about using pricing in another post called “Are you on the way to brand heaven or hell?”
Winners treat their customers as important people who have a choice and to whom they offer the best product or service they can, to satisfy, delight and why not also surprise them? If you are still thinking of such trickery as a way out of your current brand decline think again. It’s just not customer centric.
Do you have other examples you have seen of behaviour that is not customer centric? If so, I would love to hear about them.
And if you would like help in finding a solution to your own current business issue I would love to help. Just contact me for a chat and let’s see where it takes us.
C³Centricity used an image from Microsoft in this post.