The Ultimate Marketing Move - Analisis #68

Summary

In this episode, Iwan Setiawan discusses how to break free from price wars and create differentiation in business. He introduces 'The Ultimate Marketing Move' through the progression of Economic Value, which involves moving from commodity products to goods, services, and eventually to creating memorable customer experiences. The highest level of differentiation, according to Iwan, is transformation, where brands aim to make their customers better individuals. He highlights key factors for successful customer experience: physical evidence, processes, and people, all of which contribute to memorable and impactful brand interactions.

Takeaways

• 😀 The competition in the market is tough, and companies often struggle to differentiate their products and services, making them vulnerable to price wars.
• 😀 Companies need to create differentiation to avoid competing solely on price, which leads to a vicious cycle of low prices and low profits.
• 😀 The 'Progression of Economic Value' is a key concept for companies to create differentiation and charge premium prices: starting from commodities, moving to goods, services, experiences, and finally, transformation.
• 😀 The first step to differentiation is moving from commodities to goods by standardizing products and creating a unique brand identity.
• 😀 The next step is moving from goods to services by adding on-demand services that make it easier for customers, such as delivery or renting products instead of buying them.
• 😀 Many companies fail to move beyond the goods and services level and get stuck. The key to breaking this barrier is creating a memorable customer experience.
• 😀 Experience goes beyond service. While service is about saving time, experience is about time well spent, meaning customers enjoy the process and don’t rush through it.
• 😀 Creating memorable experiences can be achieved in various environments, such as retail outlets, restaurants, or even during travel like in airplanes or trains.
• 😀 Physical evidence (e.g., physical spaces, visual appeal) plays a crucial role in delivering a positive customer experience, even in digital environments like websites and mobile apps.
• 😀 The most impactful component in delivering an unforgettable experience is the people—frontline employees who interact with customers must deliver consistent and exceptional service.

Q & A

What is the key strategy for winning competition in the market according to the speaker?

The key strategy for winning competition is called 'The Ultimate Marketing Move', which focuses on differentiating products and services to avoid price wars and create higher value for customers.

What is the 'Economic Value Progression' mentioned in the transcript?

The Economic Value Progression is a concept where businesses move up a series of steps, starting from commodity products, then moving through goods, services, experience, and finally reaching transformation. This progression helps companies create differentiation and charge higher prices.

What are the steps in the Economic Value Progression?

The steps in the Economic Value Progression are: 1) Commodity, 2) Goods, 3) Services, 4) Experience, and 5) Transformation.

How can a company move from a commodity to a goods product?

A company can move from commodity to goods by standardizing the product for consistency, creating a memorable brand, and positioning the product uniquely in the market.

What does the speaker mean by 'services' in the context of this marketing strategy?

Services refer to adding additional value beyond just selling a product. This could include on-demand services, delivery services, or taking over tasks that customers would typically do themselves, which saves them time.

How does 'experience' differ from 'service' in the context of customer interaction?

Experience is about creating a memorable, enjoyable, and engaging time for customers, even if it takes longer. It contrasts with service, which focuses on saving customers time and providing convenience.

Why is 'experience' considered a higher value than 'service'?

'Experience' is considered higher value because it focuses on creating a positive, memorable journey that customers want to spend time on, whereas 'service' is primarily about saving time and simplifying tasks.

What are examples of industries that have successfully transitioned from commodities to goods and services?

Examples include gold, which starts as a commodity but becomes a good when branded and packaged, and crude oil, which can be turned into products like gasoline and further transformed into services at service stations.

What is the importance of physical evidence in customer experience?

Physical evidence plays a key role in creating a positive customer experience by offering tangible, visual elements that customers can interact with, such as well-designed store layouts or product displays.

How can companies deliver a great customer experience if they don't have physical locations?

Even without physical locations, companies can still deliver a great customer experience by focusing on digital platforms such as websites and mobile applications, ensuring that the user experience (UX) is positive and engaging.