sebastiaanquispel

Werkspot, in English meaning ‘Taskspot’, is an online platform that connects people with tasks that have to be done around the house and then connects them with suitable craftsman. But how does it work exactly? Imagine that your wall needs to be plastered and painted. You do not possess the right equipment and/or maybe not capable of doing it in a proper manner. Here comes Werkspot, where you can place this task on their website or application. Werkspot informs the registered craftsmen, after which they can reply on this task. The man or woman who needs this job to be done, can then contact the craftsman who came with the best deal, based on i.e. price, experience or their reviews. After this connection it is a matter of (little) time before the task is executed. The tasks vary a lot from placing simple fences, to whole kitchens or bathrooms.

Nowadays the company has completed over 2 million tasks, by more than 8000 craftsmen, who are all certified at the chamber of commerce. Homeowners have left approximately 237000 reviews from the start of Werkspot in 2005 until now and employs 60 people (Werkspot, 2018). Werkspot include both reviews and ratings on their platform, which give an indication of the quality of the particular craftman. The better the customer rating, the more a craftsman could ask for his work, comparing it for example with hotels in London and Paris, which get 2,68% more revenue per room in case of an 1% increase in customer ratings (Ogut & Tas, 2012).

Due to this interesting business model and a constant growth of the company, they arouse interest from other parties, which resulted in a takeover in 2013 by the American company called HomeAdvisor, which is part of IAC, a multi-billion revenue concern. This meant that the company searched for ways to enlarge their market, after which they decided to go international. In 2014 they chose to enter the Italian market, above all Milan, and with a focus on painting. In the beginning they decided to continue with their own name in Italy, as a North-European connotation gives the idea of quality and solidity in Southern Europe (Boogert, 2014). This name worked in Italy, in which they have 2000 tasks to be fulfilled on monthly basis, versus 25000 in the Netherlands. However, in 2015 Werkspot still made a pronouncement to change their name, to the name called InstaPro (Boogert, 2015). With this name they think it would be better to expand, without creating confusion.

By being the connector between households and craftsmen, Werkspot earns money by mediating between these two parties. With a 30% earnings increase yearly they are fastly growing. In two year, their top-of-mind awareness grew in the Netherlands from 6% to 14%, whereas the brand awareness grew from 22% to 50%, meaning that 1 out of 2 Dutch people know the company now. Due to the fact that Werkspot just started in 2017 with radio and television campaign, the idea is that this will increase even more rapidly (Mirck, 2017). In Italy they are busy trying to create this same improvements.

Next to that, I think it is also important to mention that the company also contributes to society. Being sustainable and socially involved become more important these days for companies; Werkspot adopted a concrete project in Cameroon, where they educate young people to become a craftsman. Afterwards, they receive their own tools to be a craftsman in practice. With a shortage on craftsman education and tools in Afrika, this is a nice way of Werkspot to contribute something extra to the world (Geredgereedschap, 2018).

This company is getting bigger and bigger, they are hard to copy due to their already established (size of) platform and they are also taking their environment into account. Altogether, a bright future in the horizon in my eyes.

References:

Werkspot (2018) Retrieved from https://www.werkspot.nl/. at 10 march 2018.

Ogut, H., & Tas, B. K. O. (2012). The influence of internet customer reviews on the online sales and prices in hotel industry. The service industries Journal

Boogert, E., (2014). Retrieved from https://www.emerce.nl/nieuws/werkspot-start-itali at 10 march 2018

Boogert, E., (2015). Retrieved from https://www.emerce.nl/nieuws/werkspots-buitenlandse-naam-instapro at 10 march 2018

Mirck, J., (2017) http://www.marketingtribune.nl/bureaus/nieuws/2017/01/lisbeth-gruppen-werkspot-is-niet-eenvoudig-kopieerbaar/index.xml Retrieved at 10 march 2018

Retrieved from http://www.geredgereedschap.nl/doe-mee/bedrijven/ at 10 march 2018

The researchers of this paper (David et al, 2017) conducted three tests to find out what the impact is of customized pricing on consumer evaluation, considering consumer’s interpersonal attachment orientation. First of all, they decided to run a survey with 172 U.S. participants. Half of them were randomly assigned to a situation in which they paid the shelf price, others also paid the shelf price or a lower, customized price. After manipulating the prices for the consumers, they measured their level of satisfaction. They found significant evidence that there is a variation in the consumer evaluation of prices, in case of customized pricing. Thereby, this relation is influenced by someone’s attachment style, namely secure or anxious. It appears that anxiously attached consumers were satisfied paying the shelf price, whereas secure consumers were dissatisfied paying the shelf price. To find an explanation for this phenomenon, a second study was conducted with 270 students as participants. The results supported the earlier findings and showed an explanation for the mentioned phenomenon, namely that customized pricing programs create an enhanced expectation of receiving a discounting price among the secure consumers. This means that these customers are increasingly price sensitive and this could be disadvantageous for retailers, as this could affect their profits. As more and more retailers use customized pricing techniques based on the purchase pattern of their customers nowadays, this has implications; customized pricing is not always effective. A third and last survey extended the findings of the previous tests, as it showed that in the presence of customized pricing programs, securely attached consumers expect to receive discounted prices that are lower than the prices that other customers have to pay. Anxiously customers on the other hand are merely satisfied paying the shelf price despite the attendance of customized pricing systems, unless they are in a disadvantaged situation, meaning another customer receives a lower price.

As earlier research mostly highlighted the benefits of customized pricing as it encourages consumer satisfaction and purchase likelihood (Van den Bos, Peters, Bobocel and Ybema, 2006 & Xia and Monroe, 2010), the results of this study showed that there is also a downside to this sort of customization. It is indeed the case that consumers positively evaluate customized pricing in which they receive advantage, but the effectiveness appeared to be heavily influenced by interpersonal attachments, as expectations are created among secure attached consumers for a discounted price. On the other hand, anxious attached consumers are decreasingly price sensitive. Altogether, this paper did not only found the relationship between customized pricing and consumer valuation, which is moderated by interpersonal attachment, but they also found the specific explanation how that is possible, namely the mentioned increasing expectations. Knowing all this now, what are the (practical) implications now for managers for example, so that this information can be used in their advantage? For marketers, it is important information as understanding when and for which customers the customized pricing is effective. Thereby, it is likely that this also applies to other forms of customized offers and services, so not only customized pricing. Managers should segment their customers based on their attachment style. For example, they can offer customized products best to older people, who are securely attached and have a higher level of income, meaning they should try to individualize their marketing approach.

A strong point of this research is the fact that they conducted three tests, with many different participants, that all found the same significant results of the impact of customized pricing and the role of interpersonal attachment. This means there is strong evidence and the validity is high in my eyes. It has huge implications for managers and marketers, as they can adjust their way of customization now on an individual basis to enlarge the effectiveness. One of the weaknesses are the fact that only Americans were involved with the studies, while people from collectivistic cultures such as China might think different about customized prices, so that external generalization is more difficult. Another point of improvement is to have more data on the actual numbers a retailer could benefit from applying their implications. No real existing examples were mentioned, which could be beneficial to really test these implications and to know how much per cent their sales would increase for example.

Article:

David, M.E. Bearden, W.O. Haws, K.L. (2017) Priced just for me: The role of interpersonal attachment style on consumer responses to customized pricing. Journal of Consumer Behaviour

References :

Van den Bos, K., Peters, S. L., Bobocel, D. R., & Ybema, J. F. (2006) On preferences and doing the right thing: Satisfaction with advantageous inequity when cognitive processing is limited. Journal of Experimental Social Psychology, 42, 273-289

Xia, L., & Monroe, K. B., (2010) Is a good deal always fair? Examining the concepts of transaction value and price fairness Journal of Economic Psychology, 31, 884-894