In a near-capacity HostingCon 2009 seminar, VeriSign SSL solutions product marketing manager Bob Angus explained how businesses can find the right mix of products, quality, and pricing to make selling premium services highly profitable in a presentation entitled “Selling Premium Services to Cost-conscious Customers.” He gave the WHIR a run down of premium service strategies in a Q&A feature last week, however, he hammered home a number of key points in the Tuesday afternoon seminar.
Basically, given the economy rough, selling “premium” services seems a little counterintuitive, however, Angus argues that they benefit sellers by generating customer loyalty, and they benefit buyers because they get dependability, return on investment, and, above all, value.
It’s so simple that many people forget it — return customers are more valuable to service providers than one-time customers. “You want [customers] sticking around,” Angus said, explaining that that satisfied or “sticky” customers are what companies should strive for — and that’s exactly what premium services provide.
Selling them, however, is another challenge — especially when other companies offer cheaper prices. With potential customers often asking “How much does it cost?” Angus says that price is not necessarily what customers are asking about. “It’s not that they’re trying to get the best price, it’s that they’re trying to get the best value,” he explains.
He says that to sell premium services, one needs to identify the basic issue, which is value. Angus advises sellers to ask potential buys about how much trust or ROI means to them, and the premium price, which comes with premium services, may seem worth it to them — even a bargain.
For instance, Angus said that Go Daddy may have the best price in the SSL market, but not all SSL certificates are equal. “They don’t work with 5 percent of browsers in use today,” Angus said, advising sellers to ask, “Can you afford for even one percent of your customers to be turned away?”
Angus notes preparation is also helpful. Known for its customer service, Rackspace provides its customer support personnel with a “cheat sheet,” which is constantly updated, that helps them provide quick answers to tough questions.
It also helps to sell services to customers when they’re most likely to buy. For instance, when customers buy a service, Dotster tries to up-sell customers on other services when they buy. Angus says this is useful because customers are in a “buying mood.”
All-in-all, Angus says that companies do not have to compete based on price, but rather value, even in trying economic times.
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