Honesty Truly is the Best Policy: New Customers Love Transparency
Are you leading customers on a wild goose chase?
You’ve done the hard part of your job, you’ve gotten them to your website and interested in your products and services. They want to buy, but your prices aren’t listed and they’re not sure how much they’re spending, or if what they’re buying is even worth it. They’re in the final hour of their buyer’s journey. They’re ready to buy, and they’ve dismissed you.
When you’re not upfront about prices with customers, it paints your company in a negative light. You may be keeping your prices secret because you don’t want competitors to undercut you, but to a potential customer, it appears you’re hiding something. It seems like a trick or a gimmick to get them to contact you and then you have their information.
It’s normal to worry about losing customers to a competitor who’s priced lower than you are, but that’s also business. Anyone can have a lower price, but not everyone can offer the substance behind their pricing.
Price transparency versus pricing transparency
There’s a difference between placing a price on an item or service and showing how that price was decided. More and more businesses are offering services in tandem (or instead) of products. When it comes to services, there’s a bit more heat on how a price was decided. There’s less value placed on a service because it’s not something physical. What you’re selling doesn’t require storage, it’s not a physical item that you ship, it’s a service with very little overhead in comparison to products.
Customers don’t always understand all of what goes into pricing a service, and if you want transparency with your customers, show them how you came up with your figures. Break it down for them to understand how you arrived at the final price.
Transparency with price and pricing shows customers there’s no hidden fees. They know what they’re paying for upfront and any kind of multipliers for your service should be provided, so they can gage what will impact their final price. It shows them from the start that you’re an honest company to deal with, and helps put their mind at ease.
There’s more to the rabbit hole…
Okay, your website shows the price and how pricing was decided, you’re good, right? But you now need to look at how buried your price is. This is almost as bad as not including a price at all. You’re still creating confusion for your customers and making them do unnecessary work to find out how much your products or services cost.
Remember, they’re ready to buy. They’re comparing prices, and they will compare prices whether they have to email you for a price or they find it on your website. All you’re doing by burying or excluding a price is making them work harder, which shows them upfront that you’re not a very customer focused company, and that you’re not forthcoming with information when they need it. For all they know, this level of running around may be part of their customer experience. Is this the headache in store for them once they choose you?
What if someone undercuts me?
Focus on value. It’s a free market out there, people price as they see fit. Companies could dig and find your price through the same channels customers do and still undercut you. Instead of trying to have the lowest price, why not go for a fair price and put your emphasis on what the customer can expect? Make them certain you’ll care for their needs and address their pain points. There’s more that goes into the decision to purchase than price. If price was the only deciding factor, all shoes would cost the same. People make decisions based on value and brand awareness more than they do the price. You could go for Pepsi or a generic that costs half the price, but you know what you’re getting with Pepsi, so you’re willing to pay more.
Transparency beyond pricing
Transparency is a habit you should get into if you want your business to succeed. In this blog we’ve talked about transparency with pricing, but there’s other ways you can be transparent with customers. When we say transparency, what we’re really saying is be open, honest, and timely. When you try to hide an error in hopes that you can correct the mistake before your client finds out, you run the risk of creating a bigger mess, a bad impression, and losing customers. If you take a long time answering emails and phone calls, you’re telling clients you don’t care about their business, even if you truly do care. Be open and realistic about what you can do. Don’t promise the moon if you can only offer the stratosphere. Tell them what you can give them and be sure to deliver on that promise every single time. The big thing to remember is that customers are constantly being transparent with you. They’re being open and realistic about what they want. It’s your job as a business owner to listen to them, give them 100% of your attention, and then provide what they want.
If you want to go full disclosure and be transparent with every part of your business, try being transparent with your employees as well. The CEO of Investopedia decided transparency was the right way to go with his company and quickly learned it was exactly what was needed to make better business decisions.
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