Would you say that a value brand is one that offers the most benefit for the cost? That sounds reasonable, right? Until you realize that it depends on a particular customer's changing perception of the benefit as compared to his or her changing perception of its cost. This is not mumbo jumbo. It's a critical distinction.
Tell the truth. It's a quiet Saturday afternoon, you're bored, traffic is virtually non-existent, and there's a sale across town on a product that you've decided to purchase: $95 off of the original price of $100! Would you drive across town to save the $95?
Okay, same scenario. Same quiet day, no traffic, but the deal is $95 off of a $10,000 product that you've decided to purchase. Would you still drive across town to save the $95? Probably not, huh?
Now think about it: Isn't the "value" - the cost-benefit ratio - exactly the same, $95 for a drive across town? You see, “value” is not a rational, stable calculation. It’s not some fixed “ratio” that you can plot on a graph.
Yet, we can easily recite our company’s well-defined “value proposition,” can’t we? And we become really frustrated and confused when customers don’t buy into it. We also believe that we can tweak our message and change people's perception of the benefit and its associated cost. Hell, that's what marketing is all about, right? Not any longer.
Today, marketing is about actually creating and delivering perceived "value" for your audience. Show me what else I am getting for my drive across town. Don't try to convince me that the $95 is worth my time by reframing its value: "With that $95, you could get a Starbuck's coffee every day for a month . . . free!"
Value is in the eyes of the beholder, and it changes based upon changing circumstances. Creating and delivering value is about figuring out how to “go deep” into your relationship with customers and their relationship with you, each other, and your brand. It’s about new processes, new business models, new ways of thinking, new ways of seeing, and new ways of interacting. It’s an endless game of innovation; of trial and error.
The days of doing a little passive market research with customers, and then using that data to manipulate messages are long gone. Today, you must be immersed in your customers’ changing lives, in their hearts and minds, and deliver something compelling and meaningful. Something that they're willing to pay for or go out of their way on a lazy Saturday afternoon to purchase. Then you'll become a "value brand."
Posted May 21, 2009
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Tom is timely, thought provoking and all about the new brand vision packaged as a Seinfeld stand up. I went to school on his ideas.
Jeff Taylor, Founder, Monster.com and CEO, Eons.
When Tom Asacker writes, I read. Opportunity Screams is the right message for the right time.
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Value for money isn't about price. A Mercedes Benz is also "value for money" for its owner, despite being expensive.
Every brand offers certain value and hence no brand can call itself a "value for money" brand. Just that the values offered by each brand differs.
Posted by: Pratap Singh | May 21, 2009 at 08:36 AM
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Posted by: runescape items | May 22, 2009 at 11:35 PM
Very interesting definition of value.
I agree with value being in the eyes of the beholder.
Your last point is compelling to. If you know what is valuable to your customers, by research, you know exactly what to give them.
Posted by: Anthony | June 03, 2009 at 10:25 AM