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Add Value Before You Slash Prices
John Jantsch | October 13th, 2008 - 01:09 PM
(10) found this useful. Do you? 
An economic climate like we are experiencing at the moment often comes with the competitive pressure to lower prices. I’m not really sure that the downturn so famously chronicled on page one has or ever will really impact the typical small business in the way that it once did, but perception can create the pressure to react to the headlines.
For most small business owners, the first place to look when facing tougher competitive challenges is value instead of price. In other words, look at your products and services and ask yourself how you can add value to the offerings before you simply cut the price to generate business. The problem with discounts is they become permanent and have the net effect of devaluing what you do. By looking for ways to add value, you will likely stumble upon enhancements that become true points of differentiation and drive the real and perceived value of what you offer up - making your business both unique and more profitable.
I saw a brilliant example of this on a recent trip to New York. Several gas stations were lined up on a busy street chipping away at each other by lowing their price, sometimes multiple times throughout the day. One of the stations decided to be low cost AND “we pump” your gas for you. Guess who got all the business?
Are there little extras, surprises and add-ons that you should be considering? Are there “standard practices” in your industry that have developed over time, but just aren’t very user friendly. For instance: Fill up your rental car with gas or we charge you $10/gal. - the first rental car company that dumps that customer disservice policy wins my business!
Can you find strategic partners willing to toss in some goodies to your customers as part of a promotional package. For instance: a graphic designer goes to a print shop and works a deal to get 500 free business cards for his logo and stationary design customers. The graphic designer enhances his package and print shop gets a new customer that will likely need that logo printed on other materials. Opportunities to tap this tactic are everywhere you look.
Add Value Before Cutting Prices | Small Business Marketing Blog from Duct Tape Marketing | October 13th, 2008 at 3:10 pm
[…] lowering your prices. I’ve written more on this, including some examples at my home on the AMEX OpenForum blog. Share and […]
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Janet | October 13th, 2008 at 4:21 pm
For 15 years I sold advertising to local businesses for my Coupon Magazine. But giving away so much ($10 off dinner for 2), (Buy one dinner, get one free), and paying $400 for an ad on top of that … well, there’s got to be a better way!
John’s suggestion of instead adding value is a great idea. Maybe I should start a new magazine where local businesses collaborate on ads to add value to eachother instead of couponing.
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Car Rental Blog » Blog Archive » Add Value Before You Slash Prices | October 14th, 2008 at 8:29 am
[…] John Jantsch wrote an interesting post today onHere’s a quick excerptI saw a brilliant example of this on a recent trip to bNew York/b. Several gas stations were lined up on a busy street chipping away at each other by lowing their price, sometimes multiple times throughout the day. b…/b […]
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Anita Campbell | October 14th, 2008 at 10:24 am
John, I love this approach. And the beauty of it is that just about every small business can find some way of implementing this in their business. The applications of “adding value” are endless — if you just look around.
– Anita
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John Jantsch | October 14th, 2008 at 10:48 am
@Janet - I love that idea of an add value magazine. I’ll create another post just on partnering ideas - they are boundless!
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Shawn Drewry | October 14th, 2008 at 6:54 pm
Let’s hope our American government gets us out of this one, because now, it looks like greed has taken over the world. I hope there will be an end to this $#!t!
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News & Views for Australian SBSCs : Add value before you slash prices | October 14th, 2008 at 8:46 pm
[…] article from one of my feeds that’s more relevant today than ever. With basically the whole world in financial panic mode & […]
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Add Value Before Discounts | idealfusion.com | October 16th, 2008 at 12:43 am
[…] I say look for ways to add value to your products and services before you ever consider lowering your prices. I’ve written more on this, including some examples at my home on the AMEX OpenForum blog. […]
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Add Value Before Discounts at Marketing Blog | October 16th, 2008 at 6:00 am
[…] I say look for ways to add value to your products and services before you ever consider lowering your prices. I’ve written more on this, including some examples at my home on the AMEX OpenForum blog. […]
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Business Slogans to Live By | Small Business Marketing Blog from Duct Tape Marketing | November 22nd, 2008 at 3:55 pm
[…] Finance - Compete on value, not on price […]
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