As a business owner, you know value creation is important for gaining the competitive edge that will help you attract and keep more customers. According to marketing statistics in fact, 49% of companies consider customer acquisition their primary objective—while 82% cite active customer retention as one of their top goals.
What isn’t always so clear, however, is how to create value in ways that more of your customers will respond to.
In this article, we’ll take a brief look at what “value” means to the average buyer by exploring 3 ways you can create more of it in your product or service.
What is value?
Because it typically means different things to different people, creating customer value can sometimes be challenging.
The best way to determine what constitutes merit or meaning in the eyes of your target audience is to keep learning as much as you can about their:
- Wants and needs
- Problems, goals, and priorities
- Lifestyles or workplace requirements
Once you’ve got your finger on the pulse of what matters most to your customers, you can begin to figure out which value creation strategies will make the biggest impact on them.
3 Ways to create customer value (with examples)
There are 3 main ways you can create value for your customers.
You can focus on:
- Optimizing your pricing
- Highlighting the practical benefits of your product or service
- Increasing the intrinsic appeal of your business
1. Creating value through pricing
Creating value through pricing doesn’t necessarily mean offering lower prices than the competition—but it might.
Your pricing strategy, for example, could include keeping your rates or prices low so you stand out in a crowded market. However, it might just as easily include charging more for your product or service to appeal to buyers who associate higher prices with better quality.
The key to creating value through pricing is understanding what most customers believe your product or service is worth. The more you know about your clientele, the easier you’ll find it to identify the pricing sweet spot that lets you earn a profit while growing your customer base.
2. Creating more practical value
Offering practical benefits or add-ons that raise your product above the rest can also influence the way customers perceive its value.
Let’s say you teach a first aid workshop and you discover that many of your clients care for children or aging parents. You could potentially increase the value of your course by including a guide with tips for keeping kids or seniors safe at home with every program sign-up.
Similarly, if the home renovation services you provide include energy-efficient upgrades, you might offer to assist customers with their energy provider rebate applications, free-of-charge.
3. Creating value intrinsically
More and more, today’s definition of value is being driven by how ethical, sustainable, or socially responsible a company is—especially in the minds of younger buyers. Statistics show, for example, that customers are almost 4X more loyal to businesses they perceive as eco-friendly.
With that in mind, you could aim to increase the intrinsic value of your business by becoming the realtor who regularly donates a percentage of their commissions to the local homeless shelter—or the retailer who plants a tree for every t-shirt sold.
Creating value to keep your business competitive starts with intimate knowledge of what motivates your customers.
Once you’ve applied that knowledge to develop or pivot your value creation strategy, measuring your revenue is the simplest way to gauge its success. If revenues are rising, it’s a good indication that more customers are finding value in your product or service.