Often when trying to find ways to remain competitive and provide the best service possible, brands can fall foul of assuming the only solution is continuous improvement.
That might sound odd, and improvement is absolutely a major part of both of these factors, however, it reaches a point where to continuously improve becomes so expensive that it may eventually come at the price of damaging the business.
This is when brands must begin to consider an alternative approach; applying a little psychology to improve user experience.
The Art of Relative Pricing in Marketing
Prices, for one example, are a key component for a brand looking to remain competitive, as all brands that want to survive should. They are set by what’s around them, but also perceived by the same measure.
Say you were browsing squash in the supermarket, and you look at the Ribena and then at the Robinsons, but then you notice a new, fancy-looking squash. You’re tempted to try it, so you look at the price: £26. This is clearly stupid money for squash, so you huff and pick up one of the others and carry on.
In the next aisle, you’re browsing gins, where you’re greeted with a selection of prices anywhere from the £20 to the £30 mark. Then you notice a bottle of Seedlip non-alcoholic spirit for £26, dressed in a premium looking bottle. In this context, the Seedlip doesn’t look too pricey, but why? What you’re paying for hasn’t changed, Seedlip is essentially squash for grown-ups and only five minutes ago you huffed at another squash charging the same money.
It’s all affected by context, where the product is situated and how it’s priced compared to its rivals. It’s this that allows Seedlip to tag on a huge mark-up to their squash, or ‘non-alcoholic spirit’, a fancy bottle, clever shelf placement and carefully constructed copy and brand identity.
What Seedlip has done is not alter the world around them, they’ve simply employed a touch of psychology to alter people’s perceptions of their product and obtained the freedom of relative pricing.
Brands can also achieve a similar effect within their own product range. Taking Twinings as an example, Twinings tea isn’t the most economically priced option available, their sales are based on the brand presence and a reputation for quality.
However, Twinings have made their standard tea appear more reasonably priced with the introduction of a premium level alternative. This higher price mark creates its own relativity microcosm; it allows pricier brands to justify their prices without having to compete quite so directly with cheaper alternatives, and providing customers with both options can only enhance the user experience.
Taking this kind of psychological approach to branding and pricing is not only largely successful but also much more cost-effective.
Something from Nothing
A similar approach can be adopted with regard to customer experience. Investing in customer experience is vital, however, there’s only so much investment to be made before it becomes financially unrealistic to continue. This is the point where brands need to think outside of the box.
In the early 2000s, Houston airport was experiencing an exceptionally high rate of passenger complaints regarding waiting times at the luggage carousel. In response, the airport’s authorities hired more baggage handlers.
Sure enough, waiting times reduced to around 8 minutes, roughly the standard waiting time at most airports, but complaints continued to pour in.
This time, management took a harder look at the situation, they noticed that passengers were spending about 1 minute walking from their plane to the carousel, then 8 minutes waiting for their baggage.
The solution they arrived at was simple. They redirected the path from arriving planes to the carousels, making it longer. Now, passengers spent around 8 minutes walking to the carousel and just 1 waiting for their bags. Suddenly complaints tapered off.
Even though passengers’ overall journey times hadn’t been cut, they were happier, because they were doing something with their time and kept moving, not standing tired and miserable at the end of a carousel.
This is simply another case of relative perceptions, by altering customers’ perceptions, not their realities, Houston airport management was able to provide a better user experience service, or least make passengers think that.
This is the same reason that most companies have hold music on their phone lines, they’ll still stick you on hold for 20 minutes because they haven’t hired enough staff, but at least you can listen to the same looped jazz track.
Despite the reality though, customer satisfaction figures demonstrate that waits feel shorter when customers listen to hold music, because the quality of their waiting experience has improved.
Approaching a problem from the point of view of the customer can yield far more effective results than blindly throwing money at issues. Considering how the end-user thinks, feels and perceives can allow for incredible return on investment when compared with blunt attempts to alter the reality of a situation.
That being said, a purely psychological approach won’t work either, without doing your best to improve the reality of the situation at the same time, the wool won’t remain over the consumer’s eyes for too long.
To learn more about how smart marketing and user experience concepts could help transform your business, contact Formation Media today.
