Customer Experience

Stop Discounting: How to Compete on Value Rather Than Price


Discounts, special offers, seasonal sales – you see a lot of that around, especially in on- and offline retail businesses. When times are tough financially, the temptation to hold sale after sale is strong. But the reality is that discounting can seriously injure your small business. In fact, you’ll see much better results if you compete on value rather than price.

Whether you’re a new business, or you’ve been around for decades, charging more than your competitors can feel intimidating. It doesn’t have to be, though! Let’s look at what it means for your small business and your alternatives to discounting.

Stand out among cheaper competitors

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Imagine your car has broken down. There’s a garage nearby which offers really cheap repairs. There’s also a garage next door which is more expensive. But it has a reputation for being trustworthy and more reliable.

You also heard that their customer service is better and they have friendly mechanics who explain what’s wrong. So where do you bring your car?

The second one, right? And that’s exactly why you should compete on value rather than price.

There are many more examples like this and they prove one thing: You don’t need to undercut your competition in price to come out on top. Price isn’t necessarily the deciding factor when a customer is looking to purchase something.

Despite what some mass-produced articles say, people don’t always look for the best quality-to-price ratio. They want more than just a bargain. And that is why competing on value rather than price is so important for your small business.

Read more about how to raise your prices without losing out on business.

How to add value

In order to sway people’s decisions in your favour, you need to add value to your products and services. It’s a great way to prove that buying from your small business is worth the cost.

Compete on value rather than price by doing something different to your cheaper competitors. Find ways to give your customers more: Be more helpful, solve more problems and care more. And don’t just assume you know what they want and need, ask them!

There are lots of different ways you can add value. Here are a few of my favourite ways to prove to your customers that you’re worth investing in.

1. Excellent customer service

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Having a great customer experience is absolutely key to competing on value rather than price. Going the extra mile for your customers will really make you stand out. For example, you can do this by:

  • Improving your communication: Make sure to communicate with your customer every step of the way. Offer tips or assistance when they’re browsing your products and send out timely order confirmations or delivery notifications. And be sure to always answer emails or phone calls as soon as possible.
  • Offering customer support: Set up a dedicated helpline or customer support team, or make it easy for customers to get in touch with you if they need help.
  • Including a warranty: Give customers peace of mind by offering them a warranty with their purchase. This will show that you’re trustworthy and reliable, and are thinking about the long-term needs of your customers.

2. Quality products & services

To compete on value rather than price, ensure your products are of great quality. Your customers will notice the difference.

Also, pay attention to small details, like packaging or delivery services. These can really help to increase repeat business and referrals. You can get started with:

  • Delivering what your customers need: Think about what it is that your customers actually want from your products or services. Offer all-inclusive packages or add helpful features to existing products so people can get exactly what they need in one place.
  • Considering your packaging: Try using recyclable packaging or reduce waste as much as possible. Depending on your products, you might want to opt for the safest packaging there is, or something beautifully designed. This will impress customers who are looking for quality rather than a bargain.
  • Improve your delivery: Make sure customers get their products quickly, and in the best possible condition. Offer fast delivery with good tracking options, such as the ability to see the exact time of delivery.
  • Proving your track record: This could be through professional certification or accreditation, winning an award or showing your success rate. Each of these options shows you’re a trusted expert in your field. You could even offer a money-back guarantee to show customers how confident you are in your products and services.

3. Create a community

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You want customers to return again and again, and you also want them to recommend you to their friends. A great way to do this is to create a community around your business.

This will prove to your customers that you’re more valuable than other, cheaper businesses. Consider the following to compete on value rather than price:

  • Setting up a loyalty programme: Go a step further and encourage your customers to shop with you again. A loyalty programme could include a special discount on future orders or loyalty points to cash in for free products.
  • Providing exclusivity: Offer previous customers exclusive access to special offers. This could even be a chance to buy early-bird products before they’re released to the public.
  • Supporting a good cause: Connect with your customers by supporting a cause that is important to them. For example, you could give a charitable donation for every item bought. Or donate a percentage of your profits to a good cause.
  • Making ordering easier: Show customers that their orders are valued by making the buying process as easy as possible. This will encourage them to shop with you again.

Talk about your value

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Once you’ve done the hard work of improving your small business’s value, you need to talk about it. Don’t be shy about letting people know how great your services are!

Additionally, encourage customers to talk about your value through online reviews or testimonials. This will show other potential customers why your products are worth the extra cost.

You can also talk about it yourself, through your marketing, on your blog, on social media and directly with customers.

And don’t forget to look out for indirect opportunities to compete on value rather than price – such as by winning business awards for your customer service.


To read more about this topic, have a look at these:
How to Raise Your Rates for Your Small Business
Should You Communicate Your Rates on Your Website?
How to Make Word of Mouth a Powerful Marketing Tool for your Business
How to Implement Customer-Focused Marketing for Your Small Business

Denise Strohsahl brand and marketing consultant for small businesses

Hello, I’m Denise from sandstonecastles, a brand & marketing consultancy based in Edinburgh, Scotland.

I help small business owners like yourself to find the right marketing that’s in line with your brand and values.