Where part two of this series focused on how the various companies cited in the study as being perceived to value position themselves within the mind of their various audiences, this article focuses on what other businesses can learn from these to companies to communicate value to their audiences.
A curious finding in the M/A/R/C and Integer Group study on the value brands found that value did not necessarily mean high quality at a low price. To the contrary, it found that respondents defined value as a good quality at a fair or reasonable price. In fact, those respondents who define value as quality at a fair or reasonable price were more than twice as many as those who defined it as getting the best quality for the least money (13% compared to 6%).
These data could be corroborated in the experience many of us have had as consumers. So long as a desired product or service is within financial reach we are willing to pay more for what is perceived to be better quality.
For example, a former co-worker of mine wanted to purchase an MP3 player for her boyfriend that he could use for exercising. At the time, iPods were just beginning to take control of the marketplace, but she apparently didn’t like her boyfriend enough to fork out the $250 for one (the shuffle, mini, and/or nano had yet to be released). So, she went to the next best thing. She found two MP3 players that were almost identical. One was a Phillips brand, the other Nike. Given the fact that she knew her boyfriend would use it for exercising she went with the Nike, which was slightly more expensive. To her, Nike meant “value” when it came to exercising, and she was willing to pay more because of that, despite the fact that there may not have been any real benefit otherwise.
So how can a business communicate value to its audiences in such a way as to cause consumers to make purchase decisions based on that value rather than price alone?
The first step is to properly position the company as something that is salient with the audience (see part 2 in this series). How do you position yourself effectively within the mind of your audience? This requires you to know three things. First, the mind set of your customer is crucial. Many marketers will say that your position should match the needs of your customer. However, needs can be created. No one needed an MP3 player until they saw how it could entertain them wherever, whenever. So, you must identify the needs of the customer as well as potential needs that have yet to be filled as well as those needs that the customer has yet to identify. Â Your value proposition should be reflected in that position and should focus on that salient current and/or future need of your client.
Second, you need to analyze the current competitive environment. Determine how you compare to your competition both operationally and from a marketing perspective.
Next, find a method to help you stand out in such a way so as to communicate a meaningful difference. For example, Target took “department store” and made it cool. Nike did everything it could to associate itself with top-performing athletics. Apple took an MP3 player and made it elegant while adding enormous amounts of disk space (at least for the time).
Establishing your position and focusing all customer touch points, both marketing and otherwise, on that position is the first step to helping you communicate that value.