For buyers, the perception of value has shifted.
Once upon a time, the inherent value of the product was what sold the product. The features drove the value. The benefits, uniquely positioned to fit an individual buyer’s stated needs, helped make the sale.
Using well-crafted, benefit-laden presentations, sellers deliver on their buyer’s priority value. If a buyer valued premium service, for example, the seller emphasized this strength and connected it to the ways it would make the buyer’s life easier.
As competitive pressures increased, B2C marketers created “added value” to ensure buyer loyalty with everything from the old S&H Green Stamps to today’s Box Tops for Education and frequent shopper perks. B2B selling followed suit, incentivizing buyers with various bonus programs.
Value-added came to mean everything from taking your top client to the ball game to special pricing and bundling options to product enhancements. Broadly speaking, the term “value-added” means any offering where the offered price is lower than the sum total of all the piece parts priced separately.
Inherent product value and value-added selling are no longer sufficient. These won’t differentiate you. These won’t spare you from commoditized perceptions. Today’s buyer wants superior products (still laden with benefits!) plus the extra added-value you routinely give to others AND something more. The “more” is usually vague and undefined. Buyers don’t know exactly what they want, but they know what it is when they find it. Until they find it, they’re always on the lookout for it.
Since a semi-satisfied buyer is unlikely to be loyal, this is problematic for sellers.
What causes this vague buyer dissatisfaction? It isn’t always attributable to price, product quality, or corporate image. It isn’t necessarily a lack of value or a deficit in added value. It’s a lack of value creation. The job of creating value falls squarely on the individual seller.
Creating value is not the same as adding value. The bar has been raised significantly by empowered consumers who are looking for better, more, different, special, and unique.
Adding value is practically de rigueur in the course of regular business. Creating value goes further. It requires identifying what would be of value to an individual buyer and then finding or making a way for that unique value to be realized. Unlike added value, created value is original and unique to the one buyer it suits.
Buyer demand for value creation has come about through a trickle-down effect. Companies began focusing on value creation to meet shareholder demands as competition escalated for many industries in the 1970s and 1980s. Now, decades later, buyers at every level want more, and they want it to come directly from sellers.
This is challenging because buyers don’t directly request value creation. Most buyers don’t even think in those terms. All they know is they want a little something more, something different from what everybody else is already getting.
Value creation happens in human-to-human interactions. Consider these three examples:
- A seller takes time to ask her buyer about the philanthropic cause prominently mentioned on the buyer’s LinkedIn page. The seller is genuinely interested, listens and asks follow-up questions to understand the buyer’s back story and commitment to the cause.
- A seller researches a buyer’s unique problem and offers advice about resources the seller doesn’t sell. The seller makes an introduction to a colleague who can help in that area of expertise.
- A seller notices a process that is clunky and prone to producing low-quality output. The seller, without selling anything, simply advises on a process fix that will save the company money and boost productivity levels.
Creating value requires being attentive, bold and committed to your buyers.
Take a look at this illustration to better understand the differences between value, added value and created value. Give yourself and your company a quick evaluation. What value are you delivering and which type of value could you increase?
After answering that question, sellers must then fill in the gaps. First consider what value you're providing that buyers may not be recognizing. Don’t let what you offer be taken for granted. Remind buyers of the value your products deliver, the added value your company delivers, and the extra special value you are creating.
With your evaluation (based on your buyer’s individual and unique values), find a way to add and create value. This does not have to be costly. Simply asking insightful questions creates value if it makes the buyer think and leads to higher-quality decisions. Figure out what your buyer needs and create value to meet that specific need.
Finally, be sure to keep in touch with what your buyer values. As their priorities change, the perception of what you’ve created may change, too. What was high value last year may be utterly irrelevant this year.
Empowered buyers buy from sellers who create unique, relevant and meaningful value.
Originally published Jun 27, 2017 6:30:00 AM, updated June 26 2017