Brands and companies that do not know what their customer’s value will ultimately fail. Take, for example, Pier 1 Imports, a store that at one point was a mecca for unique and quirky items that consumers purchased with great loyalty and enthusiasm. Recently filing for bankruptcy, Pier 1 Imports was simply unable to capture the attention of a new Millennial audience or retain its current client base. With other unique and quirky items being sold online through Etsy or Wayfair, Pier 1 Imports had stiff online competition. Their inability to reinvent and modernize their branding and their products now has them closing half of their stores in the United States and Canada and perhaps closing for good.
One of their largest mistakes was not
understanding what their current customer’s valued and failing to
understand what new customer’s valued as well. The cost is high,
and may, in fact, be their entire business. If you are a business
owner, you absolutely must know what your customer’s value in order
to ensure that you are able to provide this to them time and time
again, and course correct the value you provide when you determine
your customer’s values have changed as well.
Know Your Competition
If you are carrying quirky and unique
furniture and household items, like Pier 1 Imports, you should know
every home goods store and online retailer that is in your market and
distinguish yourself from them in some way that allows a customer to
see that your product and brand provides the value that they seek.
Make sure that you are focusing on the correct competition. Pier 1
Imports has admitted that they believed their competition was Pottery
Barn and William-Sonoma, however, most of their consumers were truly
considering Pier 1 Imports on par with Etsy, Target, World Market,
Wayfair, and Amazon. You must know exactly who your competition is to
distinguish yourself and promote yourself as a better value for your
customers.
Know Your Products
Make sure that the products that you
provide are the ones that your customers value. If consumers are less
interested in tablecloths because they view them as old-fashioned,
but more into throw pillows which are an easy way to quickly change
the look and feel of a room, your marketing research should detail
that in such a way that your company can then provide the products
your customer values. You cannot sell a product that a customer does
not even want.
Know Your Value
Price and value are not the same
things. Toyota does not cost as much as Mercedes, but both buyers
believe they have received value for different reasons. Know your
customer’s value and where they place worth, and you will do much
better in terms of being able to create and sell products that
consumers will purchase. There is also a brand experience at these
two different car dealerships that some consumers will place a value
on, while others will know. Know your customers and know what they
value, and you can better sell your product to them.
Quantifying Customer Value
Quantifying
customer value in terms of your product, the price of
your product, your place in the marketplace, your competition, your
products, and your customer’s experience is complex and
challenging. However, as a business owner, taking the time to make
this determination can be one of the best ways to provide an amazing
customer experience, customer value, and ensuring that you stay
relevant and continue to provide value to your customers.