Part 4: 10 EZ Tips To Help You Win The Price Battle
WINNING THE PRICE BATTLE
Ever-increasing costs of medications and simultaneous lowering of Rx coverage, result in a more cost-conscious patient population. And without the wholesale buying power of a large chain, it's no wonder independent Pharmacies are stuck in a constant price battle.
Here are 10 tips to gain an edge...without lowering prices.
HUMAN BEHAVIOR 101
Although people can be unpredictable, we all have a common set of needs and motivations that drive us. And one of the most basic of those, is to feel "seen" and "heard."
Consistently meeting this one basic human need can give you a distinct advantage over a big box chain.
Numerous studies show that consumers consider the "experience" of a brand just as important, if not more, than the product or service itself...and are willing to pay more for a better overall experience
No one wants to feel like just a number. Especially in this time of increased isolation, people and connection matter. In some cases, your staff might be the only people a patient interacts with, in a given day.
Try to make them feel "seen" in everything that you do...from your messaging, to how your phone is answered, to your patient follow-up.
According to Harvard Professor, Gerald Zaltman 95% of purchasing decisions are subconscious.
Tone of voice, energy level, and perceived level of caring about them as people, as well as giving them the feeling that you truly want to solve their problems, can have a multiplier effect on your Pharmacy's perceived value.
A Boston Consulting Group study showed when the shopping experience was highly personalized, customers were 110% more likely to add additional items to their baskets and 40% more likely to spend more than they had planned.
SHIFT THE FOCUS
Let’s dig deeper into the subject of “value”...
"Too Expensive" or "Pricey" simply mean that the "perceived value" of what you deliver to your customers, may not justify the level of pricing you charge...in their minds. Perception is everything.
Just as a glass of water is worth more to a thirsty person, "value" is in the eye of the beholder. You probably wouldn't spend $10,000 on a Rolex watch just to be able to tell time.
Rolex can command higher prices because they've positioned their brand in a way that its perceived and intrinsic value are exponentially higher than an equally-functioning watch made of identical materials.
Bottom line:You need to shift the focus from "price" to "value."
According to Forrester and Adobe, customer experience-driven businesses see over 150% higher year over year growth in customer retention, repeat purchase rates, and customer lifetime value.
CLEARLY COMMUNICATE YOUR PHARMACY'S
People need a reason to act. If they don't see a big enough gap from their current state to a better result, complacency will keep them where they are. Or they will default to the low price lure of a big-box chain.
So you need to give them a "why"...as in why they should choose your Pharmacy, when there are less expensive options out there.
If you customize your Value Proposition to the audience you are speaking to (meaning what makes your Pharmacy valuable to THEM specifically), you will be much more successful in catching their attention.
DON'T IGNORE YOUR BIGGEST FANS
Increasing customer retention rates by 5% increases profits by 25% to 95% according to Harvard Business School.
Yet many companies make the mistake of allocating their resources toward reaching all people, and ignore their "ride-or-die" customers. This is leaving a lot of money on the table.
By nurturing a group of superfans (read Kevin Kelly's legendary article 1,000 True Fans), you may not reach the devotion level of Star Trek's "Trekkies" or Taylor Swift's "Swifties," but this targeting strategy has been proven successful across many industries.
Celebrate and Reward Your Loyal Customers
Make them feel special with consistently friendly and personalized service
Ask them for their opinions, advice and feedback
Cater to their specific needs whenever possible
Ask them how their day is going, if they liked a product they bought, etc.
Look them in the eyes and use their name when you interact
Stock their special product requests
Take a quick moment for small talk and build rapport as much as time allows
Extra Credit: Jot down notes to their file…i.e. “sick dog named Max”. Next time they come in…“Hello Mrs. Johnson…how is your dog Max feeling?”
Because you are focusing on a smaller subset, it's easier to deliver the very best experience at every touchpoint...one that customers are willing to pay extra for.
80% of consumers are more likely to purchase when brands offer experiences personalized to them. (Epsilon study)
65% of respondents to a study by American Express said they have spent more with a business due to past positive customer service experiences.
BUILD A COMMUNITY
People are constantly on the lookout for anything related to overcoming their personal challenges, which makes gaining their attention much easier than shouting to the masses. It also makes you the one who "sees them," improves their life situation, and offers a sense of belonging.
Research shows us that people buy based on emotion,
Then justify their purchases with logic.
Another one of our most basic human needs is "to belong." That's why a connected community is where the magic happens. Especially one built around things like health issues, which affect your customers' daily lives.
To Make your Pharmacy Indispensable To This Subset of People Who Share Common Interests/Challenges.
Like those Star Trek fans, community identity can take on a life of its own, but always circles back to your Pharmacy...giving your customers a sense of shared ownership in your success. As a result, they'll want to do everything they can to help you win.
UTILIZE THE "ENDOWMENT EFFECT"
This principle says that people assign more value to things when they have a sense of ownership, and are less likely to want to give them up. This is why free trials are so effective.
Once someone has taken the time or effort to adopt a system (such as joining your group, moving their prescriptions to your Pharmacy, becoming a "preferred customer," etc.), they are much less likely to want to abandon it for something else.
So get them into your ecosystem any way you can, by appealing to their current circumstances or challenges. Offer something free (a VIP discount card, downloadable information resources, a free webinar, special one-on-one access to Pharmacy staff specializing in their issue, etc.). Anything that pulls them in. The "stickier" the better.
Once they are "in," let your community of like-minded people with similar struggles, help you nurture the relationship and deepen the bond.
All you need to do is pay a little extra attention to them. Create a (free) forum where they can talk, share stories and support one other, sprinkled with valuable tips, tricks, and resources that you (the experts) have curated for them.
Apple Super Fans Will Wait in Line For Days
When Apple Releases a New Product.
They Could Come Out With an Apple-Branded Sack of Potatoes, And it Would Sell to This Group.
Why? Because They Are Emotionally Invested in The Brand.
LET OTHERS DO THE SELLING FOR YOU
Try a little experiment. Stand on a busy street corner and look up toward the sky. You'll find that about 80% of people who pass by will also look up.
Is this because we are all sheep? Well, yes. It is called the "Bandwagon Effect"...a cognitive bias in which embracing beliefs, ideas, and trends increase when we see others have adopted them.