We all love a bargain and with the cost of living forever going up, consumers are always looking for ways to save money. Unfortunately, the cheapest option isn’t always the best. What if the product turns out to be faulty, poor quality or even fake? There are ethical considerations too – many Brits are willing to spend more just to cut down on plastic waste.
No one enjoys returning poor products or having to fight for a refund, but with so many fake online stores popping up online offering sought-after items for extremely low prices, shopping online can be risky. We explore whether low prices are still king or if consumers are now more focused on shopping with businesses they trust.
More than half of consumers (53%) say quality is the most important factor when making a purchase, compared with 38% who say price is most important. Even discounts might not be as influential as some businesses believe – 93% of millennials claim such offers have no impact on their purchase decisions.
Of course, many of these shoppers may not realise they’re being influenced – there are lots of psychological reasons why we make certain purchase decisions – but that’s high percentage of people that claim to not pay attention to special offers. It’s clear that shoppers are much savvier than they once were.
74% of consumers say price comparisons are important when making purchase decisions and 68% say customer/professional reviews are important. During the research phase, it’s clear that shoppers pay attention to both trust signals (such as customer reviews) and pricing. 94% of shoppers check reviews before buying a product or service, according to our 2018 Consumer Report.
Reviews are more influential and trusted than the advice and opinions of retail staff too. 54% say customer reviews influence them more than retail staff during purchase decisions, while 75% state they trust their peers’ knowledge and opinions more than those of retail staff.
Even if you know your audience are keen bargain hunters, being the cheapest isn’t always the best strategy if your products aren’t up to scratch. Returns cost UK retailers £60 billion annually. Poor quality products can lead to an influx of returns and those who can’t be bothered to return simply won’t shop with you again. Collecting customer feedback on your products is a simple way to determine which products aren’t meeting expectations and why, allowing you to improve your offering, reduce returns, improve your brand reputation and boost profits!
Pricing may influence customers just before they buy, but trust signals, such as customer testimonials, reviews, award badges and guarantees, can be used to persuade shoppers across the entire customer journey.
For example, a glowing customer testimonial may influence a shopper to click on a PPC ad, which takes them to a product page. Once there, the shopper can read reviews to determine if the product is what they’re looking for. When they add the item to basket, retailers can use award wins or highlight their returns policy to help convert the sale and reduce basket abandonment.
Trust signals aren’t always enough – you need to earn shoppers’ trust too. Providing a great customer experience throughout the sale process is important to winning customers and keeping them. Companies like Virgin Atlantic, for example, aren’t the cheapest in their industry, but customers know they will have a reliable, enjoyable customer experience every time, so these loyal customers will choose Virgin over their competitors, even if there’s a cheaper option available.
It’s clear that pricing still has an influence on today’s shopper, but consumers are consistently looking for companies that will provide a service and products they can rely upon. Trust signals can help win over unsure customers, while providing a great customer experience can prove to be a real advantage when it comes to your competitors.
Whatever you sell or provide to consumers, you don’t have to be the cheapest in your field, but the best.
Net Promoter® and NPS® are registered trademarks of Bain & Company, Inc., Satmetrix Systems, Inc., and Fred Reichheld.
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