The importance of offering value (not just products) to your customers

Customer value represents a product’s worth to a consumer when compared to potential alternatives. Many companies consider an equation when calculating customer value: Customer value equals the sum of any benefits a customer derives from a product, minus any difficulties they experience.

Some products offer immediate customer value with virtually no downsides. For example, a vehicle’s seat belt can save your life — all you need to do is take a few seconds to fasten it.

Often, the increased customer value of a product or service might be worth the difficulty in acquiring or using it. For example, the customer value of hot chocolate might justify waiting in the cold. Similarly, a luxury car might be worth higher repair costs.

You need to set yourself apart from competitors

Most industries have at least a few competitors, all offering similar products or services with comparable pricing models. To stand alone as a unique company in your market, you need to find ways to separate yourself from the competition. To distance yourself from other businesses that service your industry, find ways to make your portfolio unique.

Consider offering new products, in addition to those your competitors offer. Perhaps you can find ways to improve the life of your current products, or lower service prices for returning customers.

Take steps to continually separate yourself from market competition. For example, if you’re one of several coffee shops on a busy street, consider pairing each morning cup of coffee with a complimentary pastry. To help combat the afternoon lull, you could offer free internet access or even a meeting space for larger gatherings. Each of these strategies offers more value to customers than the standalone value of your product portfolio.

High value can instill a sense of urgency

Sometimes, offering value can instill a sense of urgency in your customers. Whenever this is the case, work to maintain customer interest in ways that keep customer value high.

Particularly for established businesses, customers are accustomed to the value they receive. When the value is increased to new levels, customers in your industry understand that demand will increase.

Sometimes, customers feel this sense of urgency simply when products hit lowest-ever prices, as seen during sales like “Black Friday.”

In certain cases, products native to one location might be sold in another location for a limited time. This limited access window creates a similar sense of urgency. For example, In-N-Out Burger — a burger chain traditionally located along the west coast — sold meals for a single day in London.

Lines formed three hours before opening time, and In-N-Out distributed wristbands to save customers’ places in line. After spots inside the restaurant sold out, some Londoners even offered to buy others’ tickets for £100.

You build a positive reputation

Your company’s reputation can go a long way toward creating positive customer value. When public opinion is favorable for your brand or business, customers might opt for your services even after competitors offer lower prices, faster delivery, or additional promotions.

In many of today’s markets, it takes more than a strong product or service portfolio to build customer value. Consumers want to depend on brands they believe in, companies that share their values and goals for the future.

To begin building a positive reputation, ensure that you deliver a consistently high product or service quality. Customers who buy from you once might buy from you repeatedly if you can consistently foster a quality customer experience.

After you’ve built a service catalog you’re proud of, consider the interests and preferences of your ideal customers. If you can take steps to publicly support causes your buyers believe in, you can easily improve your reputation in their eyes.

Sometimes more so than the products or services you offer, your reputation can greatly influence the status of your overall customer value.

You’ll stand out to potential investors

If you’re competing to provide in-demand products or services, you might have trouble standing out in an already-crowded market. Existing competition can prove an especially large roadblock if your business is currently seeking stakeholders.

When your company adopts new policies, rolls out new products, or otherwise changes its business model to attract customers in a crowded market, you have a chance to stand out.

When you demonstrate innovation — the ability to continually adapt to changes in your market — you position yourself favorably to potential investors. Investors in a crowded market don’t necessarily gravitate to companies with the most sales; instead, they’re looking for companies who understand market change, and are willing to reinvent themselves in response.

As a company, don’t be afraid to embrace innovation. Your willingness to evolve with your market is a strong indication to potential shareholders that your business represents a smart investment opportunity.

You expand engagement opportunities

For many markets, value is conveyed strongly during the sales stage. When a customer considers a product or service, they often consult subject matter experts — salespeople — for more information. This engagement stage is an excellent opportunity to enhance customer value.

A salesperson who goes above and beyond when educating a potential buyer can help seriously improve product value in the customer’s eyes.

There are a variety of ways that salespeople can offer value even before a sale takes place. While interacting with buyers, salespeople can offer data visualization dashboards that help familiarize potential consumers with product specifics.

If your products help customers save time, money, or energy in a quantifiable manner, Customer Data Platforms can equip salespeople with the numbers behind their claims. As long as your salespeople are prepared to use data visualization as a sales tactic, they’ll have the opportunity to inform customers and close sales.

A strong reputation is often enough to invite customers to engage. In the same way that customers might approach a reputable jeweler after seeing a diamond ring on someone’s finger, you can often expand engagement simply by providing a quality product or service.

How to improve value

There are many ways that your company can provide value for customers. To improve the value of your products or services — despite the steep market competition, rising costs, or a changing industry — consider the following actions:

• Find ways to develop and maintain relationships with customers. This could mean protecting their data or being transparent about how you use it to provide the personalized experiences they want.
• Improve your reputation by supporting causes, charities, or community events close to your target consumer base.
• Feature satisfied buyers prominently in your ongoing marketing efforts.
• Ask customers about the improvements they’d like to see you make — and then make them.
• Sell product or service bundles to increase average order value.
• Leverage buyer-nurture sequences and customer win-back funnels to increase customer retention rates.
• Offer limited-time deals that allow you to undercut your rates and heighten urgency among buyers.

No matter how you choose to provide value, it’s important to keep customers as a high priority. Collect and consult customer insights for data on how your customers act, and integrate findings into your regular marketing. Once armed with a detailed understanding of your company’s ROI, you can defend your marketing strategies with first-person behavioral data.