Have you ever bought something only to find out that the final prices is more, and sometimes a great deal more, than what you read or were told? How did it make you feel?
That feeling is the same one your customer gets if you aren’t being transparent in your pricing.
When I have discussed this with business owners, I sometimes have been told that all of the business costs were included and that the additional amount was associated fees or charges that were included by some other entity.
Yet the consumers I have asked and the research I have read suggest that people want to know the full cost with EVERYTHING included. Sometimes customers are offered information of a percentage that will be charged for a certain fee. That’s good but a dollar figure is what is preferred.
Our feeling of satisfaction with a purchase is not based on the advertised or listed price. It’s based on what we pay at the counter. When asked, many people can’t tell you what the price even is. But they can tell you what they paid.
Just think of the last survey you received that asked if you were pleased with the price you paid. What number came to mind? For most people, it is that final figure.
Business owners often admit being nervous about scaring customers off or being concerned that offering this information makes it hard to look competitive. Yet some have used it as a marketing tool, encouraging customers to ask the competitors to ask about “the rest of the story.”
It’s a tough decision. You need to look and sound competitive, yet satisfied customers are your business. Satisfied customers are also your ambassadors in getting the message out regarding your pricing policy and full disclosure.
This is a management and marketing area where you just don’t follow the crowd. Take time to ask and listen to your customer.
Transparency and full disclosure in pricing works. Think about how it fits in your business.
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Glenn Muske is an independent expert on rural small business, working as GM Consulting – Your partner in achieving small business success. He provides consulting, and writes articles for county extension agents and newspapers across North Dakota. Previously, he was the Rural and Agribusiness Enterprise Development Specialist at the North Dakota State University Extension Service – Center for Community Vitality.