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Value trumps price in the quest for business success

In today’s fiercely competitive marketplace, where businesses and consumers alike are often lured by the siren call of a bargain, a seasoned industry executive cautions against prioritising price above all else. According to Warren Hawkins, Managing Director of Euphoria Telecom, the cornerstone of enduring business success lies in delivering genuine value, not just undercutting rivals on cost.

“The truth is that people will pay a higher price for something if they understand that they are getting value in return,” Hawkins asserts. This value, he explains, can manifest in myriad forms, encompassing product quality, operational efficiency, exemplary customer service, innovation, or even a favourable environmental impact.

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Even during periods of economic uncertainty, when customers are particularly price-sensitive, Hawkins contends that there are instances where they are willing to pay a premium, provided they comprehend the rationale behind the pricing and perceive tangible value in key areas such as quality, flexibility, and customer service.

Quality, perhaps the most evident justification for a higher price tag, extends beyond mere physical products to encompass services as well. Hawkins offers the example of a business choosing between two communications providers, where a cursory comparison of monthly fees alone might lead to selecting the cheaper option. However, a more thorough evaluation could reveal that the pricier system boasts features that enhance productivity or provides insightful data and analytics to inform business decisions. Thus, while the offering itself is more expensive, it delivers real value through its performance.

Flexibility, too, is a highly prized attribute that customers are often willing to pay a premium for. Hawkins illustrates this point with the scenario of a business locked into a fixed-term contract with a service provider, only to unexpectedly scale down operations, leaving them paying for unutilised services. In such cases, the flexibility of a month-to-month contract or the ability to readily scale services up or down can be invaluable.

Customer service, however, emerges as the paramount factor in a retailer’s success, according to a recent survey of South Africa’s online retail space, with a staggering 73.9% of respondents emphasising its importance. Hawkins posits that the most revered companies for service excellence share common traits: knowledgeable and professional staff, clear and responsive communication, personalised approaches, and seamless processes.

Customers, he asserts, crave the assurance that their needs are not only met but anticipated, and that any requests or issues will be promptly and supportively addressed. Businesses that excel in these areas engender customer loyalty and a willingness to pay a premium for superior service.

Ultimately, Hawkins contends that by delivering on these three pillars – quality, flexibility, and customer service – businesses can demonstrate to customers that they are receiving a superior product or service, tailored to their needs and backed by service excellence. When these boxes are ticked, customers become not only more amenable to paying higher prices but also more likely to remain steadfastly loyal to the brand – the true hallmark of sustainable business success.

Read next: Xero unveils AI assistant to revolutionise small business accounting

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