Marketing And The Elements Of Value
Tuesday, July 25th, 2017
Getting inside your customer’s heads and understanding why they choose one product or service over another is an ongoing challenge for businesses. There’s a broad range of factors that influence a person’s purchase and the decision making process has often begun well before having physically entered a store, found your website or laid eyes on actual products or services.
From a consumer’s perspective the main driver of a purchase decision is the concept of perceived product or service value, versus its price tag. For businesses, the process for determining price is fairly straight forward but quantifying what consumers believe holds value has always been a little more complicated.
The Elements Of Value Pyramid
Eric Almquist from Bain And Company has taken a business-specific approach and come up with 30 Elements of Value that go some way to breaking down and identifying the underlying foundations of what value means to the consumer. These elements are categorised into Functional, Emotional, Life Changing and Social Impact categories and are designed to help businesses identify new areas of value in order to gain competitive advantage.
Key Points To Take Away
According to Eric Almquist competitive pricing alone is not going to win over customers, the key is in delivering more value. Taking on board the Elements of Value helps to better describe consumer behaviour in relation to products and services enabling businesses to identify potential improvement areas. A few of the other key points that came out of the Bain & Co research were:
- Digital Presence Counts. Businesses that provide online purchasing for example, offer the ultimate convenience of shopping from wherever, whenever your want – delivering big on the functional elements of “Saves Time” and “Avoids Hassles” and “Reduces Effort”.
- Quality Matters. No matter what industry, profession or business type a quality product or service is paramount. Nobody likes to feel ripped off, no amount of the other Elements of Value can compensate for a lack of quality in a product or service.
- Industry Requirements Vary. The relevance of each Element of Value will be industry specific and sometimes product or service specific, and will vary according to cultural influences and demographics.
- Aiming For All 30 Is Unrealistic. Businesses and marketers need to choose elements strategically, it is unrealistic to attempt to inject all 30 elements into any one product or service.
- Multiple Elements Is Key. The research carried out by Bain and Co did discover successfully achieving higher numbers of elements was much more likely to equal increased revenue and customer loyalty.
What Opportunities Does This Present For Businesses?
The biggest benefit of using the Elements of Value is that it helps to more easily target opportunities to add value to products and services with the aim of building a competitive advantage. It is important to keep in mind however that nothing beats providing a quality product or service. Businesses can use the Elements of Value to:
- Look at ways of refining products or services to deliver on more elements.
- Identify ways of making future products or services stand out.
- Strengthen the elements that make up the core values of the business.
- Stand out from the competition by identifying elements not already offered.
- Better meet the needs of targeted customers.
- Add value to existing products or services without a complete business overhaul.
- Increase customer engagement.
From an SEO perspective, the 30 Elements of Value are a useful tool in the hunt for ways to add relevant value directed specifically at target consumers. Website content and optimisation techniques can be tailored to showcase how the business delivers on these values. For more information contact Avatar.
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