Packaging Your Sales

When you are offering your products to your customers, there are generally a few different approaches. The first one is that you provide an ‘Added-Value Package’. This means that you may keep your product pricing as it is or with minimal increment, add-ons that you will offer for the clients, in believe that it will give a significant impact in your sales.

For example, you are having a Gelato Store, your double scoop cup comes with 3 toppings to choose from. For the added-value, you now decide to offer one free topping without any extra charge to the regular pricing. So, the customer will now have the benefit of having double scoop gelato with 4 toppings for the same purchase price. Sounds like a good deal.

The second is called ‘Value-Added Package’. You are now exploring another option to which either you or your customer will be looking into both the product and pricing adjustments needed to suit the personalized requirements. Firstly, you need to have a keen sense of knowledge of customer’s requirements.

You must also be sensitive to your customer’s needs in which by packaging the value-added products. You can attract your customer to see the benefits they are getting in return, at a specific price point or budget. In this approach, instead of just selling the product, it comes with a total solution package for the benefit of the customer, whether it’s for a short period of time or better still, for a long run.

Customers feed on your positive energy.
Negotiation becomes easier if you realize this.
Maximus @ MaximusPrimo.com

Here is where I find some companies who decide to dwell in their sales and marketing flaws. For example, a customer is enquiring about a preferred Model A car, the manufacturer or dealer will offer a premium packaged version with all the bells and whistles at say USD45,000. It comes with a three-year warranty, first three general maintenance, first year insurance and road tax are also free of cost. Now comes the Catch-22 clauses where the three-year warranty comes with a mileage limit of 150,000km, thus it stipulates whichever comes first.

Secondly, the general maintenance package is only for the service charge. Parts and consumables are payable. The free road insurance and road tax is applicable only when you buy with their optional accessories. You get the drift? The customer in most instances feels cheated and will probably be looking for other dealers who will be more ‘honest’ with their sales value-added packages.

Let’s take a look at another car manufacturer or dealer for Model B, is offering their premium packaged car at USD 50,000. They offer a five-year unlimited mileage warranty, all the service maintenance charges, including consumable is free during the warranty period. The first-year road tax and insurance are provided at a 50% discount based on the current published rates. On top of that, the client is given a flexible loan package, since the dealer is having their own finance company too.

The customer is firstly confronted with the option of choosing a car that is 10% cheaper, but with unfavorable package or pay slightly higher yet been able to afford it. They are also having the peace of mind for five years without the need to pay anything more for service and maintenance. If you are confronted with these options, which will you choose?

As you notice, the customer will most probably go with Model B unless and when the Model A is something they wanted to buy for a very long time. Then it is down to negotiations, which most of the time still will not be in their favor, but finally compromises to purchase. Returning to the company offering a better option for Model B, if you look at it, it is all in the amortization of cost. If you bundle your value-added package pricing well enough, you will be able to see the benefits both in the short and long run with good return in revenue.

It’s the value-added sales and marketing strategy that you are looking into. On one hand, you wish to make good profit, very much above your breakeven point, whilst securing high value sales too. On the other, you want to retain the prospective and existing customers to remain loyal with your company for a very long time. The height of your achievements is when your business profits from word-of-mouth recommended sales!

Retaining customer confidence is a lengthy task, but rewarding.
Maximus @ MaximusPrimo.com

The question I am asking here is, how reliable and trustworthy is your company? If one of your products is having a flaw after it was sold, how will you react to rectify the issue quickly and effectively? Are you going to remain quiet and see how many of them are brought to your attention, act to fix the problem at the customer’s expense? When the customer asks, you will say that there have never been any issues before, although you are well aware of it? On worst case, it compromises safety as well and you are not doing anything about it?

Many companies who decided on taking negative approaches ended up being back fired. In the worst case, in some countries, where you can get sued easily, incidents like these caused the manufacturers to pay multimillion dollars in damage to the consumers. Remember, customers are forgiving if you come up front and take the initiative to fix known issues immediately, even if their product did not show any symptom.

Take your time after reading this blog, to see if your product pricing falls in either Added-Value Package or Value-Added Package. Make the best of it with humble approach.

When you cheat your customers, they will remember that for a very long time and regaining their next-to-none confidence will not be worth the while. Alternatively, when you provide them with thoughtful price-point packages, you will see the benefits in return. I hope to have awakened you in your business sales direction. Time for me to take a break now and grab an apple to refuel myself!