I’m sure you’ve heard of the 80/20 rule.
Here’s a variation: 20% of the quality produces 80% of the result.
If you’re aiming at the higher tier of your market – a Selfridges rather than a BHS – then you need to remember this. Your customers are the ones who won’t be satisfied with 80% of the result, and will pay the cash to go the whole way.
Another thing to remember is this: ‘result’ can be a very simple word for a very complex set of outcomes.
Case in point:
Recently, I had a suit made by Gresham Blake. They’ve dressed Eddie Izzard and Nick Cave, and accordingly when I wear this suit I feel like a rockstar.
And it cost me a lot of money. I spent on this suit a significant fraction of what my sister spent on her last car.
Here’s what I’m looking for when I go suit shopping. These are different levels of ‘result’:
1. I get something to wear
2. The suit is comfortable
3. The suit is well-constructed
4. The suit is made of decent material
5. The suit is well-fitted
6. The suit makes a statement
There’s a rough order here from ‘general’ to ‘specific’. I can get something comfortable to wear by buying jeans and a t-shirt for £15 from Primark. That’ll meet all the basic requirements for not being arrested next time I go outside, but that’s about it.
In an ideal world, every suit I buy meets all these points. In reality, I settle for less. For instance, I can go to TM Lewin and pick up an off-the-peg suit for £250 or so. As well as meeting the first 2 points, this suit would be reasonably well constructed, OK material, and fits as well as an off-the-peg suit can – that is, well enough for most occasions. One of their suits gets me about 80% of the way to my ideal.
My Gresham Blake suit is better in every way. The construction is exceptional, the wool is a better grade, it’s made specifically to my measurements so the fit is superb. It’s just a far higher quality item.
But the thing is…
I could have had 5 suits and some change from TM Lewin for what I paid for the rock star suit. Much as I love it, I can’t justify spending that much extra on an increase in quality alone.
What makes me buy high-ticket here is Gresham Blake’s value-add. In this case, it’s #6 of my result list. No off-the-peg suit can really make a statement, because it’s a mass-produced model. It says nothing about me beyond ‘my office is closer to TM Lewin than Charles Tyrwhitt’.
At Gresham Blake, I chose my own fabric. The lining is from a limited run that was only enough to do 30 suits or so, and is now no longer available. The lapels are peaked and the jacket skirt is a good 2 inches longer than standard – it’s hard enough to find either of these on an off-the-peg suit, finding both just won’t happen. This is all part of my ideal result that I will never get if I don’t go for a high-ticket item, and it’s what persuades me to go for a high-ticket item.
Here’s the point, after all that: if you’re going to charge high-ticket prices for your service, you’ve got to justify those prices. There will be people offering a lower-ticket offering, and those lower-ticket offerings will do a decent job.
Your customers are going to be looking for a whole lot of different things as part of their final result. You can either do those things better, or you can add something they’ll never find with your lower-priced competition. Ideally, you’ll do both.
I paid 80% of my money for 20% of the result. And it was worth every penny.