Non premium and the web

We previously saw how the web is changing the notion of a premium product, but what if our strategy implies not being a premium provider? For instance premium might have negative connotations for our customers if we serve a segment within a specific income bracket, being synonymous with “expensive”, “a luxury we can’t afford”, and might make our customers avoid our stores or our products.

In the same vein Apple might have found that growth prospects in the smartphone market are better for sub $300 USD products or phones with bigger screens, none of which it was offering at the time.

The change in expectations still applies and we still need to use the web to respond to our customers, as their experience with our products begins online before they visit our physical store. Our customers may not be thinking “premium” but will appreciate answers to their queries, help in finding the right product, finding it more quickly, understanding the product attributes more important to their needs, the options required to achieve their objective – all of which works to our advantage to stop competing mainly on price. As a mass medium the web may provide us with the opportunity to compete on the experience surrounding our product at an affordable cost for a low or medium market segment.

The other side of the coin is that what might have seemed like premium before may not be premium in our customer’s mind anymore, and the difference between what they expect and what they are (or aren’t offered) will be perceived as a hassle, as inefficient.

The change in expectations might even have implications in the way our customers use our physical stores, for instance if during their online experience they grows accustomed to finding products quickly and following a certain logic (sports apparel>men’s>training>shorts) without having to ask for assistance, and our store’s organization doesn’t make sense to them (new>diving equipment>last season’s>women’s.

The perception of being a premium provider may work against us and it’s a great sign if we can adapt to our customer’s expectations by changing our positioning; but we need to go further and not fall for the trap that would take us from a particular disposable income to generic lower priced products, particularly when our customer’s expectations are changing through their use of the web, and when we have the opportunity to differentiate ourselves in a cost effective way by making our customer’s experience more productive, fun and less risky.

Going premium on the web

IMG_9036AAs competition in cheaper and more generic products gets more intense we might feel the need to make our offer more premium. How can the web help?

We can define a premium product as one clients appreciate for its performance, quality, design, a particular style that appeals to them, reliability, durability, the expertise required to produce it, as a social symbol. The emphasis is on the customer’s appreciation and expectations of the product, more than the product itself, even if it does have to conform to certain standards.

In the old days understanding, appreciating and finding such items was a luxury available to few, not just because of the price, but because of the knowledge of where to find them, the trust earned by such brands and shops and the expertise and time required to help us find the best.

Today consumers have new avenues of discovery by contacting other consumers on the web. While not all consumers are necessarily product experts, and some may be biased (they might for instance recommend a brand simply because it’s the one they bought), they do offer valuable information previously difficult to come by, such as real usage experience of the product: it is all very well if a brand or shop tells us that it’s the very best, but will it survive our particularly damp environment? Is it prone to breaking? Will it look different under different lighting? There are a myriad aspects surrounding a product which consumers look for and are now able to get answers for.

Customers’ needs may not have changed, products might be the same, but the ability to uncover all these relevant parameters is changing our customer’s experience with and expectations about our product; it follows that the very definition of what is premium is changing.

To use the web as an advantage it is precisely in these conversations that we need to be participating. Seen from this perspective what’s so startling is the almost complete absence of brands from the online conversation. Consumers are finding answers on forums, fan pages, even blogs, simply because that’s where they can find some answers, because with millions of consumers connected someone will know the arcane details of how to clean a fountain pen, why the last button on a jacket is not used, who makes the best coffee in town; we do need to be careful not to confuse the current use of these media as the only way to deliver answers.

How can we participate? We may think of our web vehicles, such as our brand website, as a “super marketer” that interacts with customers on a one to one basis; this requires specific objectives, specific policies (for instance how to deal with trolls), even a specific tone; we could also break down the complete experience into smaller pieces and think of each as a “game” in which we seek to help our customer achieve a better result, such as appreciating the engineering behind a product, feeling good about his choice, even establishing the value of his online experience as a point of reference for other customers.