We know what to expect from McDonald’s. We know what to expect from Louis Vuitton. We know what to expect from Ford Motor Company, Baskin-Robbins, and Coca-Cola. Because we know what to expect, our choices become easier. We are not going to bother going to Louis Vuitton to buy a hamburger. We understand that we can buy high quality items in very large quantities from Costco. If you build a strong brand, you are creating expectations in the minds of your customers, and they will come to rely on these expectations. Expectations make us feel more confident about how we spend our money.
People will make judgments about your organization based on every detail they see. If I walk by the front of your salon and notice your expensive interior design, I’m going to expect that my haircut will be pricey. I will probably also expect that my stylist will know what he’s doing, and I’ll feel more confident putting myself in his hands. If I enter a Mexican restaurant and see several empty tables still covered in dishes from guests who have already left, I’m probably going to expect that the service will be slow. I might also expect that the kitchen is about as clean as the customer area. Of course, I could be completely wrong on all accounts — the kitchen could be spotless and the service quite speedy. But that doesn’t stop us from generating these kinds of expectations, and prior to the first purchase our confidence in the value and quality of products and services is produced by these cues.
Studies have shown that people believe a higher priced wine tastes better. Food that is beautifully presented also tastes better then the exact same food place randomly on a plate. When you make an investment in your brand — when you pay attention to the details that affect the way your offering is received in the minds of customers — those efforts have real world consequences in terms of the way customers think about your products and services. Of course, the same techniques have been used to deceive customers. Your conscience will dictate whether or not you create your brand authentically.
As you build your brand, recognize that you are also building expectation and that people will develop expectations even if you don’t create them intentionally. When customers learn the price they will decide whether or not the price tag equals that expectation.
Mary’s Mexican Café
Mary went out of her way to secure a great location in an upscale retail center. Surrounded by well-reviewed, well-respected restaurants, she fully expected a capacity crowd most of the week. But each day, as she posted the day's menu in a large glass case outside the front door, she watched customer after customer look at the menu and walk away.
Why was she losing so much business? It couldn’t be the interior design – a flawless blend of modern architecture and classic Latin culture. She knew it wasn’t the menu, which had undergone a lengthy review process and which, she was confident, was one of the best in town.
She decided to wait outside and ask potential customers for their thoughts on her menu. One by one she spoke to shoppers, asking them what she could do to entice them inside. The results surprised her – people thought her prices (entrées between $5.99 and $8.99) indicated that lunch at Mary’s Mexican Café wouldn’t be the kind of fine dining experience they wanted.
Mary assumed she could get people in the door with low profit margins, and had priced accordingly. She also used the old 99 cent “trick” in her pricing. She failed to recognize that people assumed the food wouldn’t be very good since she wasn’t charging very much for it. People said things like, “We were looking for something a little more upscale,” or “Today we’re having a very special lunch, and we want to celebrate.” By simply raising her prices to meet the expectations that she had created with every other facet of her business, Mary was finally able to attract the business she wanted.