I was recently involved in a Money Marketing Wired panel discussion about the cost of advice. Yet I cannot help thinking there is a wider discussion to be had.
It is bit like a dog chasing its own tail – going round and round for hours in ever decreasing circles, only to ultimately be left breathless and frustrated at the end of it all.
A couple of viewers challenged the panel by suggesting the focus should not be on cost, but instead should consider value. Actually I don’t believe value is the correct focus, but it’s better than concentrating on cost.
From a consumer’s perspective there are many variables that determine the service they ultimately pay for and price is just one. As for value, only they are in a position to judge what value is to them, though that doesn’t stop us from pronouncing our ‘values-based’ propositions.
As if we have a clue?
In my opinion people are more concerned about successful outcomes and a high degree of certainty of achieving them. Focusing on cost, and to some extent on values too, detracts from the outcomes.
In other areas of my life I am the consumer, and it is worth considering what we look for when we’re on the buying side. Price rarely has a dominant role in my buying decision; it’s mostly a desired outcome and the experience along the way.
Any value I derive is based on the things I measure, and not necessarily what others consider to be value.
Keeping the proposition simple also scores well with me. Using a budget airline with low starting price is anathema to me, as I know I will have to navigate several other cost points.
I would rather use an airline with a single ticket price because while it may cost more, my blood pressure will remain stable.
Consumers face a bewildering amount of choice and decisions to make. We would serve them better by giving less choice and making it easier for them to buy our services. I do not believe we achieve that by having long menu options and opaque charging structures.
Recently six of us went for dinner at Fera, the new restaurant in Claridges.
The menu was simple. The a la carte section had (I think) four starters, six mains and four deserts. It cost £85 for three courses regardless of what was selected. Alternatively for £120, the tasting menu included everything on the a la carte menu.
We chose the latter for simplicity.
For the wine we asked the sommelier to spend a similar amount to complement the courses. It wasn’t cheap, but it was a great experience. The outcome was better than expected and I’ve now been twice in as many weeks! It had nothing to do with cost.
Dennis Hall is managing director of Yellowtail Financial Planning