There’s an old adage that says “when everybody’s your customer, nobody’s your customer”.
That’s because you cannot usually appeal to all markets within a category. Certainly that’s true with carpet cleaning. In fact, many carpet cleaners aren’t even aware that there are different markets. Often the sales pitch is “we’ll beat any competitors price”. But this doesn’t take into account what different prospects actually want. You could be trying to appeal to the wrong market.
Sometimes it’s difficult to see it in your own industry. After all, many customers just want their carpets cleaned for the cheapest price!
However, it’s easy to see different markets elsewhere.
Take cars for instance. A Mercedes owner is not the same as a Kia owner. Someone who just wants to get from A to B or who only has a few thousand pounds to spend is not going to walk into Mercedes and try to “knock them down”. Or say “I can buy a Kia for a third of your price”
And very often they may think “I would never pay 40k on a car!” Not that they’re bad people...they’re just terrible prospects for a Mercedes dealership. Do you think Mercedes dealers worry about those who buy Kia’s and say to themselves “we must try to appeal to these people and get them to buy our cars”? No, they simply recognise that they serve a different market. In most cases, a Kia owner will NOT be buying a Mercedes.
It’s the same with carpet cleaning. Someone who can only afford (or only wants to pay) £20 to get their carpets cleaned would likely feel they are being “ripped off” when given a quote of £80 or £100.
In every market there are typically four types of shopper:
Price Shoppers who always have to feel that they are getting the lowest price on everything they buy. You can get their business by offering the lowest price, but someone else will always come up with a lower price and take them away from you.
Middle Market usually picks a price somewhere in the middle because they don't trust that they get good service at the lowest price, but they still need to feel they are getting a deal by not paying the highest price. This is where many carpet cleaners think they are. They’ll say things like “we’re not the cheapest but we’re the best”. Yet they are missing out on possibly the most lucrative and rewarding market, one with the least aggravation...
Premium Price Shoppers.
These fall into two categories…
Prestige Shoppers who always have to pay the highest price or “the best” and let everyone know what they paid.
Value Premium Shoppers who can best be summed up with the maxim, "You get what you pay for." They believe that products and services are priced where they are for a reason. They have learned this through hard experience and wasted money. Value premium shoppers will never pay the lowest price even if it has a really logical story attached to it because they just can't understand that something that is cheap offers good value.
Notice how price shoppers will never pay premium prices. But also that premium price shoppers will never pay the lowest price! That’s why “when everybody’s your customer, nobody’s your customer”. You can’t target and appeal to both.
Many carpet cleaners price their service too low out of fear of not getting the job. In doing so, they may "pay the price" of lower perception of value, lost business, and reduced profits.
Of course, it’s not just a case of declaring that you’re a premium priced carpet cleaner. Putting a Mercedes price tag on a Kia doesn’t fool anyone. You can put lipstick on a pig...it’s still a pig!
So, choose your target market carefully. If you want to service the lowest price take a warning from Tesco, Asda, Sainsbury and Morrisons who have all just announced sales falling. It seems their customers are loyal only to price and are deserting to Aldi and Lidl. Unlike Waitrose who service quality seekers and don’t claim “lowest price” and have seen an increase in sales.
In fact, choosing who you want as your customer should be the very first thing that you do.