SOI 2014 - The New Buyer
Younger, Smarter Client More Interested In Price Vs. Quality
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They’re more knowledgeable, sophisticated and younger. They often know what they want before even speaking to distributors. What opportunities do these new kinds of buyers pose?
There’s a new type of buyer out there – a younger, smarter client who is often more interested in price vs. quality.
Crystal A. Davis is no stranger to this new type of buyer – and while it has presented challenges, she has adjusted her game plan accordingly.
“I’m finding myself providing pricing for those looking for quick quotes on tons of inexpensive products more and more. The majority of such potential clients are merely price-shopping, which doesn’t quite mesh well with my consultative approach,” says Davis, owner of Paw Creek, NC-based Gotcha Attention Advertising. “I’ve noticed that they are younger, they’re extremely Internet-savvy, and I’ve found that, with these particular potential customers, they have a list of things they want.”
Davis, who has a background in marketing and advertising, doesn’t want to turn those prospective clients away, but she also wants to ask probing questions to get a better feel for what might work best for their situation or event – even if the young customer already seems to have his or her mind made up.
“I have made the mistake in the past of just trying to fulfill the request, and that doesn’t work. For me, it’s impossible because it goes against my approach,” she says. “That’s when I have to slow down and say, OK, what is this for? Is it for an event? A family outing? Is it seasonal? And I just receive a little more information so I can provide the proper product. Sometimes I find that, once I dig a little bit deeper, I may be able to offer something totally different to the client that leans more toward their needs than what they originally thought.”
Indeed, the impact on price is where distributors are feeling the pinch from clients the most, according to State of the Industry data. A full 60% of distributors agree with the statement that their clients shop for promotional products primarily based on price, an increase from 58% last year.
The changing face of today’s customer is affecting industry companies in other ways too, including client loyalty. Distributors report that their client retention rate for 2013 was an average of 78%, which fell by four percentage points from the previous State of the Industry study. “When clients become more discerning on price, it tends to impact their loyalty,” says David Trewsky, president of DAT Consulting, a management training company based in New York. “You have to weigh the risk of losing a client against what you’re actually willing to charge. It’s hard for many companies to determine, but the analysis is important in business today.”
Yes, Davis says she may risk the loss of an order from someone whose sole interest is ordering the least expensive products – but for the sake of her own bottom line, that’s a risk she’s willing to take.
“If it’s someone that’s not a current client or someone I already know, I try to feel them out, and if they say, ‘I’m just looking for a book bag or a T-shirt,’ I’ll provide them a quote. And then, if I get a sense that maybe they think they know what they want but they’re not really sure of the theme of an event, I try to dig a little bit deeper,” she says.
“But I have to make sure I’m not getting caught up in competing with Internet prices, and sell myself more as a marketing or advertising professional that can provide the expertise for whatever their needs are.”
Try New Approaches
Wendy Rossman, owner of In Stitches Embroidery (asi/605822), has also had to adapt to the new wave of young, educated, price-focused clients. She’s happy to give those customers quotes on the inexpensive items they’re looking for, but she also makes them aware that cheaper may not necessarily be better, and she provides quotes for higher-end versions of the items they want.
“If I can determine that they’re price-oriented and that’s all they care about, I do tell them about the benefit of a quality item and what they’re projecting about themselves,” she says. “In my response, I’ll usually quote them three types of the same item that they’re looking for at three different price ranges.”
Rossman’s approach has paid off, as most end up spending more on higher-quality products, she says. “Probably about 60% of the time, if it’s somebody that’s totally price-oriented, I can get them into the next level up,” she says. “And that’s not just pens; that’s apparel, and hats especially. I explain, ‘Do you like that trucker hat with that snap-back? Would you like to wear it? That’s a walking billboard for you; don’t do that type of projection. Here are some other options.’”
In order to be effective in selling to this younger demographic, Rossman says it helps to speak their language, which means engaging in social media. That’s why she values referrals from satisfied customers on Facebook, where she was among the first distributors to create and grow a fan page for her business.
Rossman says 90% of her business comes via referrals, many of which come through a direct Facebook message. “I’ll have my past clients hop on Facebook and say, ‘Wendy was so awesome; they go way above and beyond,’” she says. “When you have that kind of endorsement, new customers will come in and say, ‘I saw somebody gave you a really good review.’
In the first e-mail or message on Facebook, I thank them for the opportunity and I tell them, ‘In order to help you the best, tell me more about you.’ A lot of it is relationships, and taking an interest in their business and what they’re trying to do. Once I have that, I usually go back with a proposal of no less than three items, and I cater it to the type of person.”
With the new wave of younger clientele has also come an increased demand for instant pricing and shipping. That’s why Davis has tightened up on her supplier partners in recent years.
“If I need a quick quote – let’s say a customer calls me and they have an event in a week – I’ll need a supplier I can rely on that has a good product, and if I have a question, I’ll need to make sure that they can back to me in a decent amount of time,” she says. “So, I’ve sharpened up on fine-tuning my suppliers – those 24-hour or two-day rush suppliers. That’s really helped me, as well.”
But one thing Davis has not changed is her willingness to negotiate the price of her goods. She knows that, when it comes to this new wave of buyer, sometimes letting them go is best for business.
“For those who are really looking for a certain price and want to haggle and go back and forth, I’m not going to do that because, to me, that’s a waste of time,” she says. “I do sell my service not only as the products that I offer, but also my time and expertise, so if you’re looking for a quick fix or a cheap price, the Internet is always available. I’m really going to take my time and make sure that the customer has a good event, or, if I can, help with their turnout or their marketing and provide them with more customers. I provide them with the total package, and don’t just try to shove a pen or something in their face.”