Changing the way you think about "value-added"

Very often, “value-added” is just a hyphenated way of saying, “giving your product away.” (Gift with purchase, rewards programs, BOGOs, etc.)

Before I go further, let’s clarify the meaning of value. Many people use the words “value” and “price” as if they are interchangeable… and in my opinion, they’re not. A price is what people put into the purchase; the amount they spend. Value is what the consumer gets out of your product or service; the satisfaction, benefit, or payoff they get for having made that purchase.

By “value-added,” I don’t mean slashing your price, reducing your margins, giving two for the price of one, or taking a loss on the sale. I mean increasing the satisfaction that comes with owning the products or using the services that you sell. How does your product or service add value to the consumer’s life?

Implications: This week, I received a particularly strong newsletter from Trendwatching.com, under the title of Brand Butlers. Much of the issue has to do with mobile technology, and that’s fine. But iPhone apps and mobile technology are not the only ways to enrich the way you add value to a customer’s life. Use this article to stimulate your thinking about how you can enhance the benefits and increase the satisfaction you provide when consumer buys whatever you sell.

Price is what the consumer puts into your product or service.

Value is what they get out of it.

You can add value to the consumer's life before the sale (by enhancing the process of shopping or researching the purchase), at the point of sale (by enhancing the transaction experience), or after the sale (by enhancing the ownership experience).

Mike Anderson