NEW YORK: Consumers are willing to sacrifice quality for convenience and low prices, and they’re willing to pay for the best goods and services. The problem, according to a new book, lies in the space in-between. In ‘Trade-Off’, former USA Today writer Kevin Maney contends that the most successful products offer either convenience, which includes attractive pricing, or ‘fidelity,’ which means high quality and cachet. In other words, they make people feel they either love or need a particular product or service.
But rarely, if ever, can they be the best at both. As companies compromise, they approach what Maney calls a threshold in the fidelity/convenience trade-off. “Cross it, and irrelevance awaits,” he writes.
In the late 1990s, Starbucks epitomised cool, and people were willing to endure long lines for its pricey coffee concoctions. But when it expanded aggressively, the Starbucks experience began to look rather mundane. Wal-Mart Stores stumbled earlier in this decade when it tried to move in the opposite direction. Known as the low-priced, one-stop shopping centre for rural and suburban Americans, it began carrying more expensive clothing and advertising in fashion magazines. “Consumers weren’t interested,” Maney wrote. “They just wanted stuff cheap.”
Both chains are moving back to their areas of strength.
The idea that no product can be all things to all consumers may seem self-evident. But like Malcolm Gladwell in his best-selling books “Outliers” and “Blink,” Maney presents a seemingly simple premise and the evidence to support it as well as various factors that can complicate it. For example, consumer’s expectations of fidelity and convenience are constantly rising as technology improves, so companies that fail to upgrade their products risk losing their place in the market.
Technology not only can raise standards, it can also wipe them out by setting new ones. Maney points to the coming of television, the internet, and digital photography as such “wrecking-ball moments.”
And different types of consumers have different ideas about fidelity and convenience. Kids love texting, which they can do inconspicuously in the presence of adults, while the middle-aged are more likely to make a phone call. Young people turn to the internet to find out what’s going on in the world, while those over 40 still prefer newspapers.
The fidelity-convenience trade-off also applies to individuals, Maney writes.
People who are the best at what they do can command hefty compensation and work when they choose, but those who are not as highly regarded can compensate by charging less and making themselves more available, or finding a field where they are more likely to excel.
Have you read?:
- Morrisons to open convenience stores
- Indian Consumers Are Crossover Shoppers: Nielsen Study
- Shoplifting Indians Cost Retailers Rs 9K Cr
- Co-op gains consumers with ‘ethical’ banking
- Fidelity launches new tool for “breakaway brokers”
- Marks & Spencer Chief Says Consumers Will Cope With Public Spending Cuts
Recent Comments