Recently WalMart, which is known for its focus on discount pricing, experienced a fall in its share value after it decided to set up its own pharmacies and grocery stores and abandon the “down home” friendly feel its customers liked.
Starbucks, known for its high prices, decided to raise these prices even higher. This had no negative impact on sales. Knowing what consumers want from your brand and ensuring that you consistently meet or exceed those expectations pays off, according to the business2community.com website.
What is key? Customer alignment
Starbucks does coffee and understands high-end coffee consumers. The company is focused on how it is perceived by its target audience. WalMart, on the other hand, decided to change and consequently lost its alignment. The company had a very good understanding of retail and knew its lower end, bargain-shopping consumers too.
Why is Starbucks successful? Consumers know the perceived value. No matter where or how consumers buy it, they know what to expect from the brand – even if it is relatively expensive. Starbucks has built an emotional connection with customers and it sticks to its values, which are its foundation.
Starbucks has opened higher priced luxury stores where customers can get special offers on coffees. And last year there were double-digit percentage gains in revenues over the previous year.
- Consumers must believe that your brand understands them and will meet their needs.
- If there is a blurred perception of your brand, targeted messaging is not possible.
- Consumers are willing to pay more for an experience that is specifically built around their wants and needs.
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