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When are my customers willing to pay more?

Andy Florkowski
5 Stars

Last week, my Wife and I went for dinner at the Sugar Club, which is located at the top of the sky tower. She had won a degustation menu with all the stops being pulled out, so we decided to make a night of it. We were seated beside the full height external windows, with the most incredible view over a lit-up Auckland and the harbour. However, we noticed there were a number of tables that were arranged along the inside corridor and even some outside of the restroom spaces; these couldn’t quite capture the essence of the location. I guess its inevitable with a restrictive circular footprint like the sky tower, right?

We found it interesting that although all customers would be paying for the same food and beverages, we had a much better view and dining location, and this would contribute to a better experience at no additional cost.

The likes of Paris and Rome have charged a premium for preferential seating and dining for decades. Enjoying an espresso standing at the bar will cost around 1 Euro, but if you were to drink at the seating outside the café you would be asked to fork out no less than 5 Euro. This has always been a hard one for Kiwis to get their head around when travelling.

Generally, people are happy paying more when they feel like they are getting a better experience, especially when they feel it burnishes their reputation.

Auckland is obviously not quite there, but I do wonder if our culture would embrace having the option to pay a premium in these situations.

This got me thinking about other areas of retail where customers are happy to pay more for added benefits, experience or service. There are 5 key areas that come to mind:

Immediate Gratification

Customers, like everyone else, want immediate gratification, especially when spending money. If you are able to deliver product faster than your competition and demonstrate there are efficiencies in your service that gratify your customers' desires quickly, they will usually be willing to pay a premium for this.  

Burnishing a Buyers Reputation

The consumers that buy luxury goods, or align themselves with premium brands, do so because it makes them look and feel wealthy. This dynamic applies to a seat outside a Parisian café in the same way it does to a Louis Vuitton handbag – customers are willing to pay more if they perceive the product or experience burnishes their reputation.

Quality Customer Service

It astounds me how many retailers underestimate the anger that customers feel and exude when they experience horrible customer service. In contrast to this, customers will happily pay more for a service when they know their problems and needs are handled quickly and cheerfully. Returning customers also spend 67% more than new customers – so it’s important to provide quality service and have them return!

The Ease of Purchase

Customers hate navigating complicated purchasing systems, or not having payment flexibility. If you are able to streamline the process and make the experience hassle free then they are usually willing to pay a little more.

Fostering a Sense of Community

If a customer likes you personally, and feels part of a wider family and community, they are more likely to show you loyalty and are happy paying more - especially if the price difference isn’t large enough to trigger their financial radar.

Congratulations to GO Rentals!

GO Rentals won the Visitor Experience Award.

Congratulations to our client, Go Rentals, who have just picked up the ‘Visitor Experience Award’ at this year’s New Zealand Tourism Awards. This year saw a record number of entries from tourism operators, so it is a huge achievement taking out one of the coveted awards.

As well as delivering a fantastic visitor experience through their knowledgeable and dedicated front-line teams, they were also recognised for their end to end process which combines online road trip itineraries, city guides and blog posts. Their GO App and in-branch self-service kiosks were also identified as playing important roles in bringing the rental car process into the 21st century. Well done!

In the Press

Local Media highlights from the past week...


A new tower in Auckland's Central Business District will contain 226 apartments and a 233 room hotel

Australian apartment development company ICD is planning to build a 48 level apartment block and hotel just a few metres from Auckland's Sky Tower.

The building is planned for the corner of Federal and Kingston Streets in Auckland's CBD, putting it midway between the Sky City casino and St Patrick's Cathedral.

(Source: Interest)


Even KiwiBuild homes are likely to be beyond the reach of many first home buyers if they don't have a decent deposit or a better than average income

KiwiBuild is the Government’s flagship policy to provide more affordable housing for first home buyers.

But affordability is a relative term and whether a property is affordable or not depends on who the buyer is.

(Source: Interest)


New tech to monitor NZ's biggest tsunami threat

Dozens of quake-monitoring instruments are being placed off the East Coast as part of a programme focused on New Zealand's biggest geological threat.

An international team set out on Saturday to deploy about 40 instruments along the Hikurangi Subduction Zone, a major offshore fault where the Pacific Plate dives – or subducts – westward beneath the North Island.

(Source: NZ Herald)


This year, power is getting political. Here’s why you should care

We’re not about political party flag-waving here at Flick – that’s not our mandate. What we are interested in is how political shifts and policy levers impact our customers, and Kiwi electricity users in general. So, all of us. Because that’s the thing about power – the lightbulb kind and the political kind – it really is about all of us.

(Source: SpinOff)

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