Diffusing price
resistance

The challenge:

Concerned about customer complaints about pricing, a specialized veterinary clinic was at a loss. It was worried about losing clients, but had cut back its pricing to the point where the clinic had been in the red for several months. It didn't know how to cut its prices further without sacrificing service. And it was determined not to sacrifice service.

Insights:

Pricing issues are hardly ever about price -- they're about value. We facilitated focus groups with two tiers of clients to gain some deeper insight into what the clinic's clients find valuable. We learned that whether a client was willing to pay the clinic's prices without complaint had very little to do with the quality of care the clinic said it could deliver. It had to do with the quality of the relationship between pet owner and pet. To the clinic's best clients, their pets weren't just pets. They were family.

Remedies:

We aligned the clinic's pricing, not with its competitors, but with its best clients' expectations for value and quality, without sacrificing margins. The clinic founder also felt better about letting go of those less-profitable clients -- the ones whose priority was pricing.

In order to uplift the clinic's reputation as the champion of deep relationships between pet owner and pet, we launched a public relations campaign of public service announcements, newletters, articles, and media appearances by the founding veterinarian, bolstering her reputation as the pre-eminent expert in her specialty: keeping your beloved pet happy, healthy, and in your life for as long as possible.

We recommended that the clinic groom "perfect" clients by helping foster deep bonds between pets and their owners early in the pet's life. Inexpensive tactics included:

  • Celebrating a pet's first visit to the vet with a gift of a "baby book," in which the owner could record significant moments in her pet’s life, including a Polaroid photo taken that day by a clinic staffer.
  • Holding "parenting" classes for new pet owners.
  • Posting quizzes around the waiting room and examination rooms that prompt owners to pay close attention to their pets' behavior and distinctive personalities.
  • Using every possible opportunity to educate owners about their pets -- with brochures, newsletters, even the office on-hold message.
  • Encouraging staff to learn pets' (and their owners') names, and to talk to the animals as if they were children and the owners their parents.

By tailoring its communications to attract those pet-owners whose profile more closely matched that of their "perfect" clients, the clinic was able to continue offering stellar service without cutting prices.

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Copyright 2001, Victoria Lynn Jones