Thursday, October 4, 2018

Reasonable Expectations

Not every customer expects the best – they know they can’t afford it, and sometimes they just want a basic solution at a cheap price for something that is not that important.  They have reasonable expectations – some might go so far as to say they have low expectations – and delivering something beyond those expectations is not going to impress them.

Moreover, delivering capabilities beyond basic functionally may frustrate and annoy a certain segment of the market.   Those customers who pursue a basic product understand that they are not getting the bells and whistles of  a more expensive model, and this is often the result of careful consideration: the customer knows that the additional functionality comes at additional cost, and has determined that the incremental value of the upgraded version is not worth the incremental price.

For example, consider the customers who choose to shop at a discount merchandiser.   They are well aware that they are not going to get the same level of attention and service as they will in an upscale boutique, but they are also well aware that the exact same product will cost less than half as much because a discount merchandiser spends less on rent, staff, and d├ęcor.  

It is also not necessarily a trade-off of price versus quality: a customer may choose a discount merchandiser for the sake of avoiding the level of “service” that boutiques provide because he finds being constantly “served” by sales associates to be an unpleasant experience.   That which the retailer considers to be a premium is actually undesirable to certain segments of the  market.

As a result, not every firm has to be “the best” at everything – because what is “best” is determined by the customers, and not everyone wants the same things, either from the product experience or the retail experience.   In fact, many of the largest and most successful retail brands are downscale mass-marketers – whereas those that serve the upscale market tend to be smaller, trendier, and more short-lived.

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