Electric Drives: Aftersales & Pricing
In any tech-focused industry, aftersales and the right pricing techniques have become very important. Electric drives are no exception, as these electronic devices are widely used in different applications, including transportation systems, fans, motors, pumps, robots, textile mills, factories, and more. It is broadly found in industrial production, manufacturing, and process control.
Electric drives are used to control particular parameters in a motor by converting electrical to mechanical power in a precise way. They come with different benefits, which is why there is high demand for them across many industries. Some of the top companies in this industry include Emerson Electric Co., Regal Rexnord Corporation, Rockwell Automation, etc. But, electrical drives come with two main disadvantages.
For one, they are very expensive at the initial cost. And the second is that they require a lot of maintenance and attention even after they have been sold. This is where pricing and aftersales come in, respectively.
Although electric drives are well-known to be very expensive, brands and consumers are constantly looking for the most affordable options. Thus, players in the industry must know how to properly price their electric drives to give them an edge over their competitors.
Also, since electric drives require a lot of maintenance, companies that provide detailed aftersales services would have the edge over those who forget about their customers once they’ve made a sale.
From this, one can deduce that aftersales and pricing are two things that any company in the electric drives industry has to focus on. This article will look at the importance and techniques of aftersales and upcoming trends in pricing that companies can use to meet the needs of their customers.
What Is the Importance of Aftersales in The Electric Drives Industry?
Like in any business, customers are very important in the electric drives industry. In the case of electric drives, they are not devices that are needed just once but are usually ordered regularly by companies in manufacturing and industrial production scenes. Thus, companies are constantly looking for ways to gain loyal customers who always prefer their drives to that of the competitor.
This is where the aftersales services come in. Aftersales is used to describe different processes, offers, and services that a company provides asides from the sale of the product to ensure that customers are satisfied with the product. Aftersale services differ based on the type of company and industry, but it usually focuses on making sure the product surpasses the needs and expectations of the customer.
For instance, a company in the electric drives industry can provide preventive maintenance on the motors for all customers since they know that these goods require a lot of maintenance. With aftersales, there is the opportunity to get return customers, which are the best types of customers.
Return customers are not only satisfied but are also eager to recommend your products to other customers, leading to effective word-of-mouth advertising. Even if a company offers the best electric drives, it will face a lot of competition from another company that also provides drives but does so with maintenance services and online support.
Promising aftersale services is also a good way to motivate potential customers to check out your company, making it a good advertisement point. This gives customers an incentive to choose the company over the competition. In most cases, when a customer sees a company that provides products and aftersales, they see that company as a premium brand.
This also means that those who provide aftersales can charge a higher price on their products, and customers won’t mind because they see the price is equal to the value they are getting. Thus, a successful business in the electric drives industry provides high-quality products and high-quality services.
Here are some benefits of aftersale services for an electric drives company:
- Focusing on aftersales will increase customer satisfaction and retention.
- It increases the number of loyal customers and enhances brand value.
- It gives the company a good name, and customers perceive it as a premium brand.
- It leads to word-of-mouth advertisement and increases the popularity of the company.
- It leads to better sales and profit, especially since there is a new opportunity to increase the cost of products.
- It provides an edge over the competition as it separates the company from those that don’t focus on customer satisfaction.
- It improves the bond between the customer and the organization.
Based on this, any company in the electric drives industry can recognize the importance of placing effort on aftersales.
How Intensive Is the Aftersales for The Electric Drives Industry?
Aftersales is very intensive in the electric drives industry. This is because electric drives are widely known to require a lot of maintenance and attention, providing a lot of opportunities for any company to provide aftersales. Regardless of the company, there should be at least one way to provide aftersale services to customers, as long as they are selling electric drives.
Aside from the nature of electric drives, the industry is also very competitive, which increases the need for aftersales. There are many industry-leading companies that most customers prefer to purchase from, making less-popular companies look for different ways to up their game.
There are different ways to impress customers and provide aftersale services in this industry. Based on the trends in the industry, customer needs, and the different opportunities available, here are the top aftersale services any electric drive company and its customers can benefit from.
There’s no doubt that electric drives are the kind of products that need installation, and not just generic installation but technical expertise. This is why providing pre-installation services as part of aftersales is a good idea.
Pre-installation services involve providing free installation for electric drives or a demonstration of the installation for customers, although the former is more preferred. Some top companies even provide a customer service team to install the drives and demonstrate how the drives work. This is a good way for a company to start their customer relations on a good note.
One of the most common aftersale services provided by tech companies is a warranty. This provides coverage for the customer in case there is a defect in the product and can also be said to prove the belief or confidence that the company has in what it’s selling. For instance, if a company provides a 2-year warranty, you can expect their products to last for more than that.
Elective drive companies can also benefit from providing warranty services to their customers since they provide electrical devices. The idea of an extended warranty is also a good aftersale service, although it requires customers to pay a small fee for longer coverage and more perks.
Companies in the electric drive industry can also provide free replacements or returns to their customers as part of an aftersale service. This involves accepting already purchased products or replacing them for a particular time, like two weeks after purchase.
The replacement could be for a particular component or the entire drive. If the electric drives are high quality, there’s a low chance of receiving replacement requests. But offering this aftersale service is a form of reassurance for customers that the company has confidence in their drives, and if the brand is wrong, the customers don’t lose anything.
Electric devices like drives would also benefit from offering upgrades to customers. Upgrades can be provided in different ways, but they are a way to show that the brand is constantly working on improving its products and making these available to its customers.
For instance, the company can make an upgraded version of electric drives and allow customers to buy them by submitting their old drives and placing a particular amount of money on them for a fixed period. This is both an aftersale technique and a promotion.
Training the end-user is also a good aftersale service for electric drives. This aftersale service is usually provided by industrial, manufacturing, and electrical companies. It involves providing training to users on how to use the product, troubleshooting for minor problems, and what to do to maintain it regularly. It is best provided online.
As mentioned earlier, electric drives require attention and regular maintenance. While the company cannot send its team for every little maintenance and repair, they can provide user training with troubleshooting steps for their customers.
Businesses are constantly taking advantage of the internet, and even though electric drives are physical products, support can be provided online. Thus, electric drive companies can leverage online support as an aftersale technique. There are different ways to provide online support, and customers of electric drives are expected to have more-than-basic knowledge of tech, so it’s easier to provide this.
One of the easiest ways to provide online support is through FAQ sections on the company website, which answers common questions the customers might have concerning the drive. Having a live chat on the website provided by a bot is also a common practice and gives customers quick access to customer service.
In some cases, electric drives that are seriously damaged cannot be fixed with online support or user training. This is where repair availability comes in. To build a strong relationship with the customer, companies can provide highly-available repair experts to reduce the device’s downtime using the electric drive.
Some malfunctions can be repaired remotely, but it also helps have some engineers on standby to visit the factory and any other location and fix it for the customer. This aftersale can be provided for a token or be covered under an extended warranty.
It is also possible to provide preventive maintenance on electrical drives to reduce the chances of damage and high repair costs in the future. Rather than waiting for electric drives to get damaged, companies in this industry can provide regular maintenance through periodical visits.
This aftersale service is a great way to gain customers’ trust, increase the initial cost of your product, and increase customer satisfaction and retention. It also allows them to find malfunctions quickly and fix them before they become a serious deal.
The final aftersale service we have for companies in the electric drives industry provides additional features and services for free. This is a popular trend in aftersales, as companies can provide free services for a limited time or a lifetime to attract customers and gain their trust.
In the case of electric drives, companies can provide free replacement of a particular part for a lifetime, free repairs for a limited time, free counseling or customer service, and others. With the nature of these products and the competition in the industry, there are many ways to provide aftersales and meet customers’ needs.
Which Ones Holds More Importance: Service or Products?
When discussing aftersales and pricing, this is one question that is constantly asked. There is the constant battle of wondering if the product is more important than the aftersale service or if it’s the other way around. But rather than trying to decide which one is more important, it’s much better to focus on how they are meant to complement each other.
Take the following scenario as an example. A customer is opening a factory and purchases a large batch of electric drives from a company. But there is a problem with the installation, and the customer tries to reach the company, but to no avail. There is also no installation service, and the official website does not offer much help. Will that customer purchase their next batch of electric drives from that company or move to their competitors?
This shows that although a high-quality product will attract customers and make them interested, a high-quality aftersales service would keep them loyal and attract even more customers through that one. If the company in the example provided top-notch aftersales, the customer would make repeat purchases while being rest assured.
Customers in the electric drive industry, and many other industries, want their service providers to meet their needs even after purchasing the product. They also expect the product to properly match the price without thinking about the costs of aftersales.
So for an electric drives company, offering a top-quality product without any installation or repair support is risky and shows a lack of interest in the customer’s experience. Not only this, but it can ruin the future of the company and its place in the industry, especially if its competitors are doing it.
To answer the question above, none of them hold more importance but are equally important to a company’s growth in the electric drives industry. Companies in this industry should focus on making only the best drives or motors and should also provide the aftersales services provided earlier in this guide.
This way, customers can have a good experience from the moment they purchase their product to when there is ever anything wrong with it.
How Is Pricing Done in The Aftersales of the Electric Drives Industry?
One of the major challenges of aftersales is connecting this to pricing. Electric drives are already known for being expensive, as mentioned earlier. But when a company is providing aftersales, they need to fund it and still profit. A company cannot provide aftersale services at a loss but cannot push them aside to profit.
Even if aftersales can be used to justify the product’s high price, the company must ensure that they can easily provide maintenance and installation services within the initial selling price. This is why some companies provide an extended warranty to fund the other aftersale services.
There are different ways for companies in the electric drives industry to set their pricing while accommodating the cost of providing aftersales. These techniques can provide a solution to this main problem.
First, we have value-based pricing, and this is one of the most popular ways of pricing products in the tech and manufacturing industry. It is also widely found in the electric drives industry. It involves placing a price on the product based on its perceived value rather than its historical price. In easier terms, companies that follow value-based pricing will set a price on their drives based on the value their customers think it has, rather than what it has been before.
This strategy can increase the revenue gotten from sales without increasing the number of drives being sold. Consequently, the company can use the increased revenue to cater to aftersales without losing.
In the case of electric drives, there is already a wide belief that they are generally very expensive to purchase, so any customer who wants to buy it would expect a high price. Now, if the customer sees that the company they want to purchase from provides warranty, preventive maintenance, online support, repair availability, and many other aftersale services, the high price they see would begin to make sense.
This means that the company would have manipulated the customer’s perception of the product’s value. And when a customer places a high value on the product, it’s easier to sell them at a high price and still provide high-quality products and services.
Competition Based Pricing
Another pricing technique that can accommodate aftersales in the electric drives industry is competition-based pricing. This industry has a lot of competition because many companies that manufacture electronic parts and products always make drives. Thus, even if your price makes sense compared to quality and aftersales, it all goes to waste when a particular competitor whose offerings are up to par with yours sells at a lower price.
Competition-based pricing involves setting your prices in relation to your competitor’s price. Unlike only basing your prices on the cost of production and perceived value by customers, public information on a competitor’s pricing also plays an important part when deciding pricing in aftersales.
Any company with competition in the industry can implement competition-based pricing, as it’s pretty easy and comes with low risk. Keep in mind that if you provide high-quality aftersales to your customers, you can’t bring your price down to compete with a company that has no or few aftersale services to offer.
Competition-based pricing can be easily done by conducting competitor research to find your direct and indirect competitors. The purpose of the research would be to determine the price of their products and their aftersale services and compare them to yours. Then, set your pricing so that you have the edge over them.
Companies in the electric drives industry can also take advantage of pricing software if they’re having trouble deciding prices while providing aftersales. Pricing software is a commercially available platform or application that provides tools to automate pricing optimization, analytics, and execution. Based on the analysis, companies can make effective pricing decisions.
Since electric drive companies are looking for ways to offer competitive and value-based pricing without making a loss while providing aftersales, they can use the software to analyze all of these factors and choose the right price.
Pricing software also improves the speed of your pricing decisions and ensures that your company is not left behind. They can be customized to meet the need of a company in the electric drives industry and focus on optimizing your profit goals while staying ahead of the competition.
The electric drives industry involves more than just selling electrical drives to customers to use in their factories, manufacturing, processing, and more. Instead, the industry is becoming increasingly competitive as there is a higher demand for these products in tech applications. Because of this, aftersales and pricing are now more important than ever.
Companies in this industry need to take it upon themselves to provide only the best aftersale service without making a loss. They must also do so to increase customer retention and loyalty while justifying the price of the product. This guide has covered all you need to know about the latest trends in aftersales and pricing and how you can apply this to the electric drives industry.
Electric Drives: Aftersales & Pricing
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