I believe the most basic definition of marketing is: the steps a company takes to enhance the perceived value of their offering. There are a myriad of techniques a good marketer will use to enhance value. In this article I will focus on those techniques and ideas that will create value for customers by improving the offering itself. When I use the phrase ‘Enhancing Value’ it means making your product or service feel like a better deal. You can also think of it as making it more attractive, easier to buy, or more competitive. All of those phrases mean essentially the same thing. Will people feel like they came out on top by giving your their money to get your offering?
Enhancing Value through Price Changes
This is the area where many business owners start when enhancing value, and with good reason. It’s easy to adjust the price of your offering. Most people think of lowering their price to make it more attractive to their customers. This can work very well, it can also backfire if you’re not careful. We’ve all seen grocery stores try to make themselves more relevant by advertising lower prices. What does that do? It puts them head to head with the grocery chain that owns the low price segment, Walmart. Those smaller chains will never have the same buying clout that Walmart does, so they will never really be able to compete. They’ve doomed themselves to failure.
You may not have a behemoth like Walmart in your industry but you likely have other businesses claiming the lowest prices. If you can truly offer the lowest prices, and survive while doing it, lowering your prices to make your offering more attractive may be a good option. Just be very careful about it. Make sure you’ve done your research and know that you can out discount the competition.
Another option with pricing changes are to use sales or coupons. The nice thing about this is that it makes it easy to introduce people to your company without having to accept a permanent loss in profits. If you’re strategic about it, you can use a sale or coupon to drive sales of items that aren’t being discounted. For example, if you have a coupon for whiteboards you will probably be able to sell dry erase markers, erasers and hardware to hang a whiteboard with.
You may also want to consider raising your prices for enhancing value. This only works with certain products or offerings, so be careful with this one. Keep in mind that you will have to justify why your product is more expensive. When justifying the price, don’t really solely on saying that it is higher quality. There will always have to be more to it. You can talk about it’s exclusiveness. Or that it allows the buyer to be part of a movement or cause. Or appeal to their vanity by saying that it will show their discerning taste, intelligence or even their wealth. The key here is that you are no longer selling just your product, you’re selling a lifestyle and a reputation. We’ll come back to this one a little later.
Enhancing Value by Bundling
Bundling isn’t something that works for all products or services but it can be a powerful way to enhance the value of your offerings. This works by making it easier for the customer to make a purchase by reducing the choices they have to make. Often companies will also provide a discounted price for buying a bundle as opposed to buying products a la carte. Don’t just combine offerings haphazardly though. You will want to consider a few things when putting together your bundles, here are a few questions to consider:
- What offerings make sense being sold together?
- Can you pair a high profit item with a lower profit item to even out your margins?
- Is there an offering that you want to raise the demand for? Pairing it with an already popular item helps introduce it to buyers and may increase demand for the previously unknown offering.
Enhancing Value by Supporting a Cause
Many people are willing to pay a little bit more if they feel that that extra money will go to support something they believe in. Is your product made from recyclable materials or can you offer recycling of the product once it’s served its purpose? Both of those factors can help enhance the perceived value of your offering. You can also commit to donating a percentage of proceeds to a charity that resonates with you and your customers. If you’re not sure what causes your audience believe in, try monitoring your target audience on social media to see what causes they follow and support. The cause doesn’t have to directly relate to your business but choosing something that aligns with your offerings may provide more of a boost. A web design company might consider donating tablets to a school district. Or a barber may donate personal care items to a shelter.
Enhancing Value through Segmentation
You may have heard the phrase “He could sell snow to an eskimo”. Some people have the gift of being able to convince other people to buy anything, the rest of us rely on segmentation. I alluded to this earlier when talking about using price to enhance the value of your offering. Your offering will inherently appeal to some people more than others. We usually think of segmentation only when it comes to advertising, but it really starts with the product itself.
I had a client that was a mechanic, his service is usable by any that has a car. Most auto shops define themselves by fixing cars, they may only work on certain makes or only on certain parts of the car but they haven’t defined their service beyond that. With this client we decided to define his product as woman friendly. He was naturally a soft spoken person, with a gentle and kind demeanor. I helped him design his logo, waiting room, and forms to be more appealing to women. The social media we relied on were Facebook and Pinterest. He hosted regular car care parties (note that we didn’t call them auto maintenance workshops). The parties were catered by a local bakery. He became the women’s mechanic.
There are lots of Options
There are tons of ways you can increase the value of your offering without having to invest lots of money. In most cases it just takes some strategic thinking and some creativity. Let me help you do enhance the value of your offering with a free consultation today and see how many options you have available to you.