The Many Faces of Value
You give all those folks who come to your Web site good value, right?
Now, before you go nodding your head too enthusiastically, let me ask you
another question: Can you tell me what constitutes value? Oooo, that’s a
toughie. My dear loyal readers have heard me say often enough that
value is
almost never about price.
So how do we define it? And do we really need to?
I don’t believe there is any one way of looking at value, but I do believe
there are qualities in the broad concept of value that your particular
business will answer differently for the
different sorts of folks who come
to you. This is why the process of Uncovery is so critical to designing an
effective persuasion process. It helps you understand and then articulate
the value of what you offer to the folks who come to you.
No perception of value? They’re gone. But you … stick around!
Mohanbir Sawhney, McCormick Tribune Professor of Technology at Northwestern
University’s Kellogg School of Management, organized his ideas on the nature
of value into seven over-arching qualities. It’s good stuff (I was going to
say good value!) and well worth considering in your top-priority mission to
become truly customer-centric. The words (abridged) are his.1
- Value is customer-defined. Never forget that value is defined by those who
use and those who pay for it. To understand the true nature of value, you
need to get inside the minds and hearts of your customers, whether they're
internal or external. Vendors must communicate the value of their products
not in terms of what these products do, but what they do for customers,
expressed in a language that customers can relate to.
- Value is opaque. An important consequence of value being defined by
customers is that it is very difficult to quantify - you need to understand
all factors that customers take into consideration in assessing value, and
you have to understand the relative importance that customers place on each
factor. In the absence of this understanding, you are shooting in the dark.
Once you understand the factors that specific customers consider when making
decisions, and how they make trade-offs, you can develop a better
understanding of the value propositions that might appeal to each one.
- Value is multidimensional. A common myth in business is that decisions are
made solely on functional value—a product's features and functionality.
Value has two other dimensions as well: economic value—what these features
and functions are worth to customers in terms of time and money; and
psychological value—the emotional benefits that customers get from your
products or your company.
- Value is a trade-off. Value is the perceived worth of something in relation
to the total cost that customers pay for it. This definition underscores the
fact that value is a trade-off between costs and benefits.
- Value is contextual. You cannot divorce the value of [something] from the
context in which it will be used …. Unless you understand the end-usage
context, you run the risk of creating value propositions and offerings that
are irrelevant for customers.
- Value is relative. Customers never assess value of an offering in isolation.
They always consider value relative to alternatives. These alternatives may
not be other products or systems, but other ways of accomplishing the same
goals or doing nothing at all …. By understanding competing alternatives,
you will also be able to focus on points of differentiation relative to
these options and ignore points of parity that clutter and dilute your value
proposition.
- Value is a mind-set. The value mind-set is grounded in the belief that the
sole purpose of a company is to create value for its customers and to be
compensated equitably for its efforts. Therefore, everything the company
says and does should revolve around its customers—not its products. This is
a radical shift in perspective, and few companies truly embrace this idea
despite their claims of being customer-focused.
Thinking well worth considering.
The value of whatever you are doing out there in cyberspace lives solely in
the minds of your visitors. They decide what value means to them, and then
they look to you to see if you provide it. So ask yourself if your
persuasive system identifies the qualities of value that are important to
your visitors. And then ask yourself if your site truly communicates these
values effectively.
1 “Fundamentals of Value.” Mohanbir Sawhney. Net Gains, CIO Magazine. July
1, 2003.
http://www.cio.com/archive/070103/gain.html.
Your Privacy is Guaranteed
|
