Unstoppable, high-priced marketing: Get rewarding returns

In 2000, I consulted for the first time. The client was the “Songchuan Enterprise Company” in Foshan, Guangdong, a food packaging machinery company with an annual sales of about 60 million. At that time, the company’s product price was 20% higher than its counterparts in Wenzhou and Qingdao, and the salesmen were quite struggling.

As a marketing consultant, I suggest that the company should first increase the price by 100%, and then support the technology advancement and service upgrading of the company with the profit space gained through price increase, implement the “differentiated marketing” strategy, and focus on the positioning of customers in Guangdong (Dongguan, Shantou ), Chengdu, Shanghai, Tianjin, four food-intensive areas. With the joint efforts of employees, corporate performance has doubled in succession. Two years later, factories such as Shanghai Qingpu, Tianjin, and Pengzhou in Chengdu were established. The position of “leading industry leader” is deeply rooted.

Not expensive, rather die

This personal experience of “high-priced marketing” made me passionate about this marketing approach. In my opinion, conventional prices often lack brand loyalty compared to high prices. Regular prices, low prices, just to make products, like selling ordinary vegetables radish. These do not reflect the benefits of differentiation, and therefore there is no brand loyalty to scientific research.

Some companies have invested heavily in terminal coverage, terminal interception, and terminal promotions to make up for the “brand loyalty deficiency”. The cost rate is very high and the management is also very difficult. This kind of operation will one day make the company “ indigestion".

In fact, high prices are a kind of profit-making. Why do you say this? Because high prices are not just high retail prices, but also include high actual payment prices of the brand operator financial department. Given the high retail price, it is still not possible to give profits to distributors, retailers or terminal salespersons.

At the same time, only if the brand operator has a lot of money, it is possible to have space to support the cost of delivering the brand's special value, making the brand a brand name recognized by consumers as a high price. Channel partners have a reasonable return. On the contrary, brand operators do not have brand-building costs and products will always be homogenized. The interests of channel partners are also false and short-lived. From Coca Cola, Nestle, Procter & Gamble, to Wuliangye, Maotai, all brands that have long-term and abundant profits for their channel partners are those whose prices are higher than similar products and where the spread to distributors is less than similar products.

In addition, Rangli is still "Bai Rang + Good Heart". Even if the dealers are not willing to accept high prices, the channel partners must sell them at low prices, and the high price will quickly evolve. Confusion prices, rout prices. The product will eventually fall into the homogenous competition. The “ransom” obtained by the channel dealers is nothing but virtual profits and riches on paper.

Consumers are often not experts and do not understand the true cost of the product. The price cuts in the middle of the game make consumers who have already been purchased feel “deceived”.

Some people also say that you can make low-priced, easy-to-earn profits, and then you can increase your brand price later. However, low prices are always non-return, once the profits to the dealer, it is tantamount to blocking the brand's successful thoroughfare. High-priced products are brands, and must not be short-term favored by the channel and embark on a "nominal short-term" no return.

Excavating the value of consumers

The industry has such a saying: "conventional prices, consumer satisfaction, lower prices, consumers are surprised." And high prices? High prices, is to allow consumers to "overjoyed."

In fact, from the perspective of consumer satisfaction and consumer overjoy, the foundation is of course “fair and inexpensive”. Countless companies are caught in price wars, promotion wars, and wars of attrition because they do not understand the two words in the word “cheap”:

Price: It is the consumer's overall payment, not the price.

Objects: The benefits that the offering can give, that is, the total value that the buyer can obtain, not the item.

The success of high-priced marketing is also the highest level of “cheap”. This is not just a substantial reduction in total consumer spending, increasing the total value of consumers, but also brings consumers to a new level.

To reduce the total expenditure of consumers, in fact, it is not necessary to lower prices, and it is entirely possible to increase prices. As long as the increase is smaller than the decline in total consumer spending, overall consumer spending will continue to decline.

Among these, products can be improved and the total cost of consumers can be reduced. For example, Hainan Zhengye Zhongnong Company, according to the seasonal law of crops, introduced integrated products, the price is higher than the sum of single product prices, but farmers can reduce the number of spraying and save labor costs. After the products are available, the positive product prices increase, As income increases, farmers’ direct money expenditure increases, but labor costs decrease, and overall costs decrease.

At the same time, increasing technical services and lifting customers' worries is also a way to reduce the total cost of consumers. Under normal circumstances, after the expanded food is produced, it must be packaged immediately. Otherwise, it may become wet and wasteful and increase the production cost of the company. Delaying orders may also affect market competitiveness and sacrifice corporate profits. Any packaging machine may fail, such as the belt is worn, broken, and some parts are broken.

Foshan Songchuan Machinery, in order to reduce the total cost of customers, significantly increased the price of the product, at the same time, in the food factory concentration in Dongguan, Shantou, Shanghai, Chengdu, Tianjin and other places, the establishment of raw material storage, storage spare machines, equipped with professional technology Personnel, to ensure "2 hours to resume operation." Reduced the total cost of the customer.

Hainan Zhengye Zhongnong Hi-Tech Co., Ltd. also selects “core terminals” in the “high-consumption crop” production area, allocates experts in agrochemicals, plant protection, etc., and guides the entire process, so that growers can rest assured. For this reason, raising the price by 25% means that growers have no worries and will only find it cost-effective.

In fact, some high-end consumer groups in Shanghai, Guangzhou and other places have already accepted the “servicing” service of imported wines: high-quality premium wines and professional sommeliers. When the consumer entertains guests, the appearance of the sommelier increases the personal brand value of the guest; the sommelier's professional operation of the wine, the industry enhances the value of the product, the value of the drinker, and the consumer is willing to Pay for this.

Take McDonald's as an example. In addition to food, McDonald's has more "new tricks." For example, they create innovative toys every year, and they only send them for sale. Miss McDonald's attendants lead small consumers to sing and dance every day. McDonald's introduces reference patterns for children to fetch together with chips. When McDonald's became a children's paradise, these "image benefits "The cost of the fries themselves and the price they sell will become less important to customers.

In product marketing, once the use of the product changes, the consumer will have new evaluation criteria, and the price controller in mind will also sublimate. For example, pho in Guangdong and Vietnam can only be used to fill their stomachs, so they can only sell 5 yuan. The "24 pho," the main "exotic" to receive guests not only lose points, but also passed the "work hard, save time" and other ideas, so 24 pho to price 24 yuan, saving the "feast to the customer" expenses The total cost of consumers is reduced.

There will also be a situation where people do not drink wine and liquor at high-end banquets. In response to this demand, Le Cordon Bleu launched more than 100 yuan of beer each, and many companies introduced fresh-pressed corn juice and freshly-squeezed purple-sweet potato juice for more than 100 yuan per bar. In fact, the cost of the product itself is still less than 5 yuan, but the total The value has changed.

There are many examples of this: signing with important customers, if you use the "Montblanc pen", then tell each other, the Hong Kong return to the agreement, the Middle East armistice agreement, the German armistice agreement, are using this brand. Then, each Montblanc fountain pen sells for thousands to tens of thousands of yuan, is it very cheap? Feast senior leaders, if you take out Wuliangye, even if the leader does not drink white wine, will be very happy. 800 yuan to buy a "personal brand image security" is not very cost-effective? The same drinks, drink 5,000 yuan at the banquet, Lafi, the customer feels the pressure, one million single non-signed, if only drink 300 yuan "Local specialty wines", customers feel that they are merely ordinary receptions and reciprocal reciprocations. This single ticket can be signed or not.

One of my clients, Beijing Hanjin, is a "high-priced marketing" specialized company. One of the proud works is to select some tea leaves and bind certain calligraphy, calligraphy and painting to Go, so this combination is given the meaning of “do not ask business, only drink tea and play chess and foster good days,” and it is particularly suitable for The second-line leaders are the leaders of the rich people who have turned in power. Each kilogram of tea, up to 500,000 yuan.

Integrate market resources

Science and technology are not primary productivity. The ability to integrate market resources is the primary productive force. The Germans have mastered the core technology of beer, without prejudice to the fact that the beer industry in the United States far exceeds Germany; the Germans monopolize all the core technologies of solar energy and do not prevent Chinese companies from buying German technology, and then drive German companies out of Africa and Southeast Asia: Shenzhen. “Fortress mobile phone”, when the highest peak sales of 1.5 billion units each year, swept Southeast Asia, the Middle East, Africa, technology is purchased from European and American companies.

Many small and medium-sized distillery companies in Sichuan have the advantages of quality and cost advantages of white spirits. This can not prevent Yanghe Blue Classic from surpassing Sichuan Distillery; even if the technology of Lanzhou ramen needs to receive royalties, the maximum value of each bowl is RMB 1 in each case. In front of 25 yuan ajisen ramen, nine cows a hair.

Distributors, retail sellers, and terminal service providers want companies to do business by reducing prices, gifts, promotions, gifts, and entrance fees. However, before consumers recognize them, they instinctively refuse to surpass market price products.

When the brand's unique interests begin to be accepted by consumers, the distributors and restaurants are still excited about the price. Customers often put forward such opinions: “If there is a dealer, if the price cuts to Wuliangye and Maotai, they are willing to pay the price. 1000000". In short, when you set a high price, you have to prepare yourself for brand promotion and cultivate the “value sense” of consumers themselves, so that consumers are willing to pay for high prices.

However, distributors are only logistics providers, and retail terminals are just "marketing platforms":

In addition to these, there is one thing that should not be overlooked. It is to reduce the "sales" of profits and expand the "marketing" space.

The success of Shuijingfang in Guangdong depends on compressing “sales” expenses and increasing investment in marketing, such as giving the terminal a series of differentiated benefits such as intelligent public relations, training marketing, and wine demonstrations.

The success of the recent series of imported wines is also related to the new model of “store + group purchase”. The new model increased marketing and cut sales. The price of Ajisen Ramen can be five times higher than that of Lanzhou Ramen, and the "24 Beef Noodle" sold by a Taiwanese Vietnamese person sells for 24 yuan, which is about 5 times higher than that of ordinary beef noodle. It also depends on "sales and marketing". Structural changes.

There is such a case: East China has a liquor factory, government support, behind the market is huge, strong financial strength. Always low-end wine. The boss is hard-working and hardworking. After the success, he is still conscientious. The team he leads is also very dedicated. However, due to the requirements of the government and the temptation of the market, several high-end attacks have failed.

It is precisely because of the high value of high-end products and low-end products, corporate culture is very different, the boss is accustomed to low-end wine culture, can only tolerate high-end team; and any tolerance, the degree is limited, the original team Like the "Red Army" of Jinggangshan, sandals, rifles, physical strength, loyalty, but poor performance. The new high-end team is like a modern missile force. It does not necessarily have a strong body for surfing the Internet and checking missile devices. However, it is better than a thousand miles. They have a lot of knowledge and independence, and they may be more dependent on the boss than the Red Army. Low, if you can't balance the gap between the two teams, you can imagine the crisis brought about by the company's sales management.

Therefore, high prices do not guarantee success because of the previous roads; but only by first taking this road, it is possible to embark on the broad road to brand marketing and make great achievements.

The author is a Principal Consultant at Wealth Management Consulting and an expert on Channels and Value Network.