Living predominantly in the product development world, I’ve focused on what a product needs to do to deliver value to the customer. I’ve also been heavily involved with how it’s branded, marketed and sold, but I’ve never had much to do with quoting or the sales transaction process.
I’m trying to right this wrong as I’ve come to the realisation that this stage of the process is equally important in delivering a great user experience and increasing the customer’s perceived value of your product. Unfortunately, this is often the stage where a potentially happy customer can become extremely dissatisfied as it is where they first encounter the level of bureaucracy within your organisation.
Let me explain using my recent experience hooking up a phone line to my new home.
How to annoy and frustrate customers
In Australia, Telstra is the only company that can physically connect your line and provision a phone number, but there are many other providers than can offer a phone or Internet service. Some of these other providers may offer the ability to provision your line as well, but they ultimately use Telstra to do the work.
I needed Telstra to connect my phone line so that I could go to my other provider of choice and organise a naked DSL plan.
On speaking with the Telstra rep, I was advised the connection fee would be $299. OK, fair enough. He then went on to say “which plan would you like”, to which I responded with, “I don’t want a plan, just the connection thanks”.
Apparently six months ago, Telstra introduced new connection pricing where you cannot get connected without taking out a plan. After explaining what I was after, I was told that the best way forward was to take out their budget phone plan at $20 per month, then cancel it immediately at a cost of $100.
This left a bad taste in my mouth. Why should I have to take out a plan that I don’t want or need, and pay $100 to cancel it?
Price attractively without changing a cent
I later thought that if the Telstra rep had presented the connection fee as $399, with an option to discount this to $299 if I took out a Telstra phone plan, then I would have been much happier.
Why? The fact is I had no expectation on what the connection fee would be. I just needed the connection done. They could have said $299, $399, or $1000 – whatever!
But taking out a plan I didn’t need, then cancelling it at a cost of $100 leaves me feeling ripped off. Had the Telstra rep offered the $299 deal if I purchased a Telstra plan, I may have been tempted to look into them. He could have then touted the many benefits of their plans and made a sale.
Because of the way it was pitched, my perceived value was much lower than it should be.
Don’t let bureaucracy get in the way
Unfortunately it’s not just the sales guy at fault. In fact, it’s difficult to blame him at all as this is the way the product’s pricing is structured. All his collateral material will refer to these unnecessary plans and it is difficult for him to state otherwise.
Product Managers need to plan their product packages so that no customer groups are being penalised or made to purchase items they don’t want or need. This seems like a no-brainer, but it’s easy for companies like Telstra with a diverse set of customers to miss this from time to time.
Failing that, hire sales staff that can identify what the customer really needs, and empower them to pitch your product in a way that increases perceived value. They need to be able to venture ‘off script’ when the need arises.
Ultimately, don’t let bureaucracy get in the way of delivering value to your customers. Because after all, the customer’s perceived value is your product’s actual value.