In my 30+ year career in sales and marketing, I have found the idea of adding value is poorly understood by small businesses and sales people. That’s understandable. As a business person, coming from a place of service, you want to add value to attract and serve customers so you naturally offer something you consider valuable.
The key concept here is “customer perceived value.” Adding value is a waste if your customer fails to see it as valuable. The measure of value is determined by how the prospect perceives your offer.
People buy for many reasons. It’s seldom about lowest price. This is why it is crucial to understand your ideal customer profile. Why do your customers buy from you instead of a competitor? Ask them.
Reasons People Buy
- Save money
- Make money
- Save time
- For some other emotionally compelling reason
Emotionally Compelling Reasons
When it comes to the first three of those reasons, you generally will get them to buy without adding further value. It’s when you want to attract people without them saving money, making money or saving time that you care about “emotionally compelling reasons.”
The following are examples I have found work; you can find others:
- Image, like believing they appear successful or popular
- A feeling, such as pride, joy, happiness, comfort, being pampered
- An experience, which restaurants achieve with a theme or atmosphere
- Service – I find customers expect good service
- Sense of community – Harley Davidson motorcycles, Airstream travel trailers, and Disneyland all thrive on a sense of community
- Sense of being part of something larger than themselves: customers feel good about shopping from businesses like Starbucks and Body Shop which care about others as shown by how they treat their suppliers.
Examples of Adding Value
It’s not what you find valuable. It’s what your prospects and customers find valuable. This requires ‘getting into their heads’ to really understand what is important to them.
Here are a few examples of successfully adding value:
- Restaurants with kid proof booths and colors children find attractive, providing activities they enjoy, like McDonald’s PlayPlaces and Happy Meals
- Car dealership that took a picture of you with your new car or truck then sent you a calendar with that picture
- Radio Shack Computer Centers, when microcomputers where new, offered free training to teachers. This added value resulted in a $40,000 sale for me.
- Radio Shack’s free battery back when people still used carbon batteries, brought customers back monthly
- Being greeted by name
- Listening to what they want and need – listening earned me millions in sales
How to Find Out What Prospects Value
The following are effective ways to learn what customers see as adding value:
- Customer surveys -Numeric ratings alone are of limited value in understanding your customers and what they like and want more of. Ask for their opinions.
- Test and measure results, like split tests; look for which yields the best sales or the most actions taken
- Read customer reviews of your products and services
- Read customer reviews of your competitors products and services – what did they like; what didn’t they like
- Find the forums where people meeting your ideal customer profile hang out then read their posts
When creating value, you need to understand that only your custome’rs perceived value is important. What do they want and what do they think adds value? Some things like listening and greeting them by name cost you nothing but caring and desiring to really serve them. Provide the value they want, and you will beat competitors who only discount. You can never sway everyone, but you will attract the most profitable customers and enjoy a relationship to boot.
More from this contributor:
Success in Selling Comes from Listening, not Telling
First Person: The Value of Customer Satisfaction Interviews
First Person: Learn to Sell the ‘Right’ Way