August 28th, 2017 by Oren Smilansky

Many a study has concluded that customers are willing to pay more for a better experience, but does this theory always hold up when placed under the magnifying glass? After all, isn’t price a major part of the experience?

I’ve been thinking about prices lately, and wondering just how miserable an experience I’m willing to tolerate if it means that the product or service in question is more affordable than the alternative. And the answer is a lot. I’m willing to put up with a ton of crap just to save some dollars. And yes, I understand that this makes me sound incredibly cheap, but I know for a fact that I’m definitely not the only person who feels this way. 

Example. I’ve been a Planet Fitness gym member for almost three years now. The main reasons being that Planet Fitness’ clubs are a easy to find in New York City, as they’re conveniently located usually within walking distance from my apartment, and they’re affordable. My willingness to excuse their flaws has quite a bit to do with their low monthly membership fee, which is a quarter of the next best option in my town.  

And Planet Fitness, for all its charm, has its share of imperfections. At least the gyms I’ve been to do. The experience is…quirky, if I’m being generous. On several occasions, I’ve been stopped at the front desk after swiping my membership card, only to be told by the attendant that there’s a problem with my account and payment information. This despite the fact that I’d already been set up in their system for an auto-pay plan for almost two years. They also charged late fees because of this payment error, which wasn’t my fault to begin with. And when I asked about a possible refund for this error that wasn’t mine, they weren’t able to help me. In the past week, I’ve received two automated phone calls from them, telling me, again, that there was a problem with my account, and that I needed to fix it. Fine. But when I tried to log into the website, as instructed, the system isn’t able to process the changes I made. These are problems that illustrate that the company hasn’t invested in the technologies that would make things easier for customers.

Another issue is that the place is consistently messy. Anyone who’s been to this gym knows that they give away Tootsie Rolls in a big bucket, which is of course generous, but also odd for a couple of reasons: a) the last thing most people attending a gym need is candy by the fistful, and b) people don’t throw the wrappers away like they’re supposed to, opting instead to toss them on the floor, or in the machines’ bottle holders. At the gym I go to, they also have a peculiar tendency to send in a janitorial staff member of the opposite sex into the locker room unannounced. My list of grievances goes on, but they get away with it and I remain a loyal (if annoyed) customer, because their prices are great.

Another company that comes to mind for similar reasons is Megabus. Whether I’m going to Boston of Philadelphia or Rhode Island or Washington DC, I can usually count on them to offer tickets at roughly the same price (between $10-$25). But, in their case, there are also trade-offs. One is that the bus is rarely on time, both arriving and leaving. I’ve arrived on trips two hours later than the advertised ETA. At the beginning of one recent trip, the bus driver even announced that the ETA advertised on the website wasn’t reliable, and that we, the passengers, should ignore it in the future. Once, I tried to get a refund for a ticket that arrived two hours late, only to wait on the phone for 30 minutes with customer service. These buses have wifi access, but the connection is about as reliable as Amtrak’s, which is not very reliable at all. All this being said, Megabus’ prices beat the competition. And with the $60 or so saved on what would have typically been spent on a train ticket, I’ve expanded my budget for the rest of the trip.

I guess that what I’m trying to get at is that, for me, and for many, saving money is an essential part of the experience. I’m usually willing to pay less, and maybe even suffer a bit, if it means I can afford a better experience later–perhaps somewhere else.  

Hey Oren

I’d come here to read about CRM and expand my knowledge on the subject. But this article caught my eye and I’ve gotta say, I’m not sorry it did.

It was an interesting read. Personally, I’ve always tried to put little stress on the price of my services (obviously, CRM-related) and focus on quality. Surely, that’s the way to go. But you also have an interesting point, beautifully put in one question: After all, isn’t price a major part of the experience?

I think for all of us, there are two types of spending. One is long time… something that will stick with us for a long time… and the other, services and products that are for our short-term use.

When we’re dealing with the latter, pricing becomes much more important, than when we deal with the former.

I guess that’s how we should see the whole thing. It’s something subjective, and is in total relation with how much money we have and how we perceive the money that’s being spent.

Thanks again for your thought-provoking post
Alizadeh – Ever247

Comment by Alizadeh — — September 4, 2017 @ 6:30 am

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