Date: November 23, 1999
From: "John Leistritz" <email@example.com>
Subject: AMS-Forum value vs price
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David, your argument strikes at the heart of the challenge to anyone marketing moving services. Not only does the public in general perceive moving services as a commodity, to some extent moving services ARE a commodity. As you point out, the actual level of service delivery doesn't vary, in general, from one carrier to another, or even one mover to another. What's more, it's sad but true that a customer who gets a 45% discount is no more guaranteed a great move than one who auctions the discount up to 60% or more.
Before you throw in the towel completely, however, consider that MOST products and services are, to some extent, commodities. Yet, it's commonplace for toaster brand X to sell for more than brand Z, even though they both do the same thing. Nordstrom's, to take a famous example, charges what I consider to be outrageous prices for what are essentially the same items elsewhere. They're not only still in business, they thrive and grow.
Closer to home, there are movers---I know some personally, and others have commented in this forum---who hold the line on price and manage to not only stay in business, but do well. Chances are there are one or two in your market.
As I've said in this forum more than once, people buy on price for one of two reasons: either they literally can't afford to do otherwise, or they've been given no reason NOT to. What reason not to buy on price is there? Essentially, there are two. First, the value and reputation of your company's brand name. I'm not necessarily talking about your carrier affiliate; I'm talking about your company.
Reputation is achieved by being truthful, helpful and thorough with customers, and not ducking the call when the "wheels come off the wagon". Value is partially a product of reputation, and partly a product of exposure. It's human nature, all things being equal, to prefer the better-known brand to the lesser-known.
The second reason not to buy on price is staring at you in the mirror. Again, all things being equal, people will prefer to buy from those they like and feel they can trust. Many people out there selling moving services today treat their prospects as though they're just blips on a sales curve. And, as a famous ad man once admonished a cynical copywriter: "The consumer isn't an idiot; she's your wife". People instinctively know when they're getting a snow job.
Will you always overcome the price issue? Of course not. But to treat price as a marketing strategy is to give up before you've begun. There's plenty of time, once you know you're on the "short list", and once you've decided you want the business, to use price as a closing tactic.
Don't sell yourself, your company, and the moving industry short.
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