It is fair to say that most people want value for money and frequently enjoy a bargain. This was particularly important over the past number of years when we all had to “watch the pennies”.
However, I would pose the question to anyone “Do we buy on price alone?”
In most instances, people will agree that price is important. However I would maintain that it’s not the only factor when making a decision to buy.
This is especially true when you consider that image and brands have a part to play just as much as safety, reliability or comfort. Moreover, studies have shown that people will spend 20% more on price if they really want the product or service and see it's worth it.
In fact, research shows there are 5 motivating reasons why people buy. Each of these factors represents a different need that customers wish to fulfil. They include:
- Pride – the prestige or image (brand name) associated with the product or service
- Profit – the price, value for money, level of efficiency or economic return given
- Comfort – the benefit to a lifestyle, quality or peace of mind provided to the customer
- Safety – the security, reliability or safety of the product or service
- Appeal – an attractive feature that an individual may like about the product or service or perhaps they completely trust a particular salesperson and always go on their recommendation
Very often, customers will consider several factors to be important whilst others are relevant at all. There will always be one need that stands out above the rest and sway the customer’s decision to buy.
I have put this theory to the test many times on my sales training workshops using different examples. One includes asking the question "If you were given €10,000 and told to go out and buy a car, what would they buy and why?” Hypothetically, they can spend it all or just part of it, whilst pocketing the rest. The responses from participants will often vary, each of them choosing different options every time.
Interesting enough, sometimes answers can be quite alike with people of similar profiles. For example, I often notice that young people go for pride or image, participants with young families go for safety and others who drive a lot will go for comfort or even appeal as they favour a decent coffee cup holder. Price is often one of the least popular.
In short, what I have learnt is that people are never the same and so it is important that we don’t presume we know what customers want. We may have an inkling. What we really need to do is talk to our customers and ask questions to find out what’s important to them and then listen to their response before making any recommendations.