I will confess to being frugal, but I am not cheap. I will gladly and cheerfully pay for value. However, I am infuriated every time I hand my credit card to an airline ticket counter agent for four minutes worth of work to confirm my standby seat on a flight with empty seats. I am equally, if not more irritated, every time I replace a printer ink cartridge and pay nearly as much for the ink cartridge as I did for the printer.
Why do I find these costs so annoying? Largely because I am trapped. The airline and the printer companies are treating me like a rat in a maze, not a valued customer. If I want to print, if I want to go home, I have to play the game by their rules.
The companies in both the airline and the computer printer industries act in concert with one another leaving me, as the customer, essentially powerless. It is the sense of powerlessness, the feeling and the reality that I am paying a hefty price because “they have me” that I find so unpleasant.
Every company needs to make a profit in order to survive and thrive. I want my preferred suppliers in both my business and personal lives to make a fair profit so that they may continue to provide the products and/or services I procure from them. However, I want to feel valued, not manipulated. I know that I am not alone in this desire.
I have been thinking a lot about this dynamic as it relates to my business (publishing) and we continue to strive to build value into our programs and offerings. In the publishing business we used to have a number of high-profit, low-value revenue centers. Or, areas where the price was out of line with the value being delivered. Nearly all of these revenue centers have been squeezed out over the course of the last several years, which I think is a good thing.
Are there areas in your business where you change customers a lot of money just because you can? Low-value, unfairly high-profit revenue that irritates your customers? If so, it makes sense to me to think about reducing or eliminating these areas. I do not mean take a voluntary revenue reduction as few of us can afford that especially within this economic climate. But, perhaps look at ways to turn annoying, low-value fees into a high-value deliverable.
If an airline offered me no-charge flexibility when they can, they would have a customer for life. I am not asking an airline to secure a seat for me that they could sell. But, it would make me really happy if they offered me flexibility when they have empty seats available. Twenty empty seats are not going to be sold 50 minutes before take off…great opportunity to make me happy and build value rather than forcing me to pay a fee. Maybe they have the opportunity to increase their revenues by selling “jump seat passes.” Not for consumers to literally sit in the jump seats, but an annual pass that would offer more flexibility to pass holders.
Could a printer company charge a fair price for their printers, a fair price for their replacement ink cartridges and perhaps keep their revenue flowing by offering feature add-ons or software downloads for a fee that would enhance the functionality of the printer? If the add-on or download adds value, I will gladly pay for it.
Within previous posts I made a number of recent comments about the book “What Would Google Do?” by Jeff Jarvis. In his book, Mr. Jarvis points out a fascinating aspect of Google and some of the other very large internet players like Craig’s List and EBay. Many of these internet players operate on a model of charging as little as possible rather than the traditional approach of charging “what the market will bear.”
To me this is a fascinating idea and one that I am thinking a lot about. Most of us have and need to have business models much different than that of Google or Craig’s List, but what does apply is that most of the current internet giants have built value into every aspect of their businesses. I don’t believe that the same can be said of many more traditional businesses/industries…at times, even my own.
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