Value applies to many things and can be defined in many ways. There’s absolute, relative and ethical value. Then there’s product, trade and personal value – all which relate to “little value” and “good value”. Value is everywhere, yet sometimes nowhere.
Quite simply, value boils down to a customer decision. Your customer will either decide to give you their money, or they’ll decide to keep their money – both for the same reason – Perceived Value.
Defining value in a large-sale is easy. Think about it as the relationship between the size of your customer’s problem and the cost of your solution. If you can get your customer to perceive that the size of their current problem is larger than the cost of your solution, you’ve built value and will probably make the sale. Therein lies the rub.
Almost all of your customers arrive with problems big enough to shop, but not big enough to purchase. And expensive products are expensive products, even if you’re the low-cost provider in your category. Problems must be perceived as serious enough to solve … or your value building efforts will almost always be marginal. The solution is straight-forward:
Grow Problems … Grow Value.
Which means you have two choices. To build value in what you offer – make your customer’s problem bigger … or not build value and make your price smaller. The choice is yours.
The bigger the problem … the bigger the value.