Value is the key to increased wealth

Your customers will always make their purchasing decisions on the basis of perceived value of your products or services as compared to that of your competition . It’s a simple formula that has little to do with the actual quality of a product. It’s like trying to sell an air conditioner in Antarctica – there is no real perceived value to the customer.

Many companies make two big mistakes . First, they create a product or service without determining the value of that product or service to their target customers. Second, they focus on building something that is “different from” or “better than” the products or services of their competition. Both of these approaches ignore the real target of a strategically-minded business: the customer or client.

The key to increased wealth through both increased sales and margin is in having a much higher perceived value . The Strategic Value Innovation System™ is a value-delivery system. The goal of this system is to help you determine what you must deliver (and how) to your customers that will clearly offer superior value. Even in a price-competitive market, they will pay more for perceived value.

Not convinced? Here are a few examples from every-day life. Do you think McDonalds hamburgers are superior in quality to their competitors? They found a greater perceived value in convenience and standardization. You always know what you’ll get, no matter where you are in the world. How about Dell computers and their rivals? They increased their sales (and their assets velocity) by delivering on the higher perceived value of online ordering and bundled pricing.

Word of mouth is still the best marketing plan

You can have the best-designed business model with a powerful strategy to eliminate your competition, but if you don’t provide an outstanding perceived value, your customers will spread the word like wildfire. Suddenly, you’ll find your competition way ahead – all at the speed of the Internet.

Customer value must be woven throughout your organization, starting with the business plan, and not ending until your customer’s company goes out of business. Value does not end at the time of the sale. The real importance of customer value resides in its ability to influence customer satisfaction, and, more importantly, customer retention, loyalty, and repurchase ratio.

To keep customers, you must maintain a higher perceived value .

A survey of 767 corporate executives (Business Week, page 10, July 21, 2003) showed that while 75% of executives said they were happy with their supplier, almost as many, 66%, were looking for a new supplier. This means, that, unless a company focuses on value, even satisfied customers could easily leave!

How to create a powerful Value Proposition

There are two key factors to be measured in any company . The first one is your company’s "value proposition". We measure and define your value proposition during the Strategic Value Innovation session. You learn exactly what products, services, and customers are going to make you the most profitable, and which are a waste of your time, money and resources. Generally, my clients follow the Strategic Value Innovation session with the second key factor, the Strategic Laser Sales System. The Strategic Laser Sales System provides you with the specific means to sell value over the full lifetime of your customers.

When combined, the Strategic Value Innovation System™ and the Laser Sales System™ create one powerful tool. You identify exactly how you will provide superior value to your clients and profits for your company. These tools are based on a series of proven concepts such as Marginal Value, Customer Lifetime Value, The Buyer Utility Map, and the Unique Selling Proposition (UPS).

The Strategic Value Innovation System™ is a sophisticated system that helps you accurately define your customer base; quantify the current and the full-potential value of these relationships in relation to your products and services; and commit, your entire company to closing the gap between the actual and potential value of your products and services.

Companies implementing The Strategic Value Innovation and Laser Sales Systems™ are operating on an entirely different level. They no longer have to evaluate their performance based on comparisons with last year’s figures or with their competitors. They no longer use such an abstract matrix as market share or customer satisfaction. Instead, they have a system that is used within the entire organization to continuously create a higher perceived value in the eyes of their customers. The end result is more sales and more long-term customers.

Want to find out more about the Strategic Value Innovation System™? Click here for more detail, or email Carlos Dias at carlos@carlosdias.com.

Remember that this system, as with all of Carlos Dias’ systems, is customized to meet your specific company and market.

Carlos Dias
carlos@carlosdias.com