“Competitors undercut us and spend more on R&D”
“Their products are better, they sell at a lower price point and their marketing budgets are three times the size of ours.” That’s the conversation that started my week as I spoke with a marketing director for a midsize household appliance brand about a competitor. Basically, the competition is going after his breakfast, lunch and dinner.
I hope that you don’t relate to this, but if you don’t at the moment, you might in the future. It is tough out there and with the UK economy in a frenzy as consumers head the warnings about household debt and worry about Brexit, getting prospects to part with their hard earned cash is tough.
And then there is the competition.
In response to questions or concerns like this, I talk prospects through the finding of an independent study which we commissioned into the power of rewards. There is a lot of data in this, and you can access it here.
Within this research there are two stats that really stand out.
- People will pay more for a product or service if it has the right incentive or reward attached to the purchase. 34% of the British public has done this in the past year with 16% having done so more than once.
- People will opt for a lower quality product or service if the right reward or incentive for doing so is on offer. 31% of British adults say they have done this in the past year, with 15% saying they have done so on more than one occasion.
Now, we are not saying that you should sell poor quality products at a higher price with an incentive. But we are saying that if there is anxiety about competitor activity, perceptions of value and quality, then the right incentive or reward can level the playing field and in many cases, tip it in your favor.