Product, service and price – pick which one you’ll do

A great product sells itself. It matches what the clients want. It is a quality good that lasts for the intended period. It is well designed, easy to use, and so on.

Great service is about helping the customer work out which product matches their need. Your staff take pride in helping people. Your follow up service after the sale is remembered and your customer’s rave about you to their friends and family.

Great price means giving people what they want at a low price. They can’t believe the good deal they are getting and will come back for me.

Now pick one of the above for your business. You can’t do all three. Maybe you can do part of a second one, but never the third.

It is a big mistake to try to be all things to all people and here’s why.

A great product usually means higher cost. You invest more time in the development of the product and you make it out of better materials so it lasts longer and is more aesthetically appealing or easy to use. This is incompatible with great price – with the possible exception of a large multinational which can manufacture in very high volumes and sell in bulk.

Great service usually means higher overheads. Not only do you need more people, but you need to retain the good ones as they are the heart of your business. Also, you need to set up your business systems to allow your people to provide excellent service. Many organisations can’t bring themselves to trust their staff that much. A lot of customers are happy to pay though.

Great price means that you need to cut out all unnecessary costs in order to exceed the customer’s expectations. Cutting costs can be done through lean operations, large scale manufacturing or moving large volumes of product. This approach is pretty much incompatible with great product or great service.

If you look at your competitors, or even other industries, you will notice these differences exist and that they each have their own customer base which look what they value.

Think about your own values, and also about the values of the customers you want to deal with on a daily basis, and if there is a profit to be made go down that path.