Creating Value For Your Customers

1
Creating Value For Your Customers

• Developed by
• Strategic Marketing Group
• Competitive Tools for Market Leadership

2
What is Value?

• I am not sure what value is, but I know it when
  I see it. Anonymous
• Value is the right combination of product
  quality, fair price and good service.

3
Creating Value is More.

• Creating value means more than a price cut or
  coupons
• It means giving more an improved product or
  experience with added features and enhanced
  service---at a good price.
• It means changing the role of marketing rather
  than a means to shape an image, marketing becomes
  part of the system of delivering value to the
  customer.

4
What Value Doesnt Mean

• High quality at a higher price
• Cheap, if cheap is bare bones or low grade
• Prestige, if prestige is viewed as snobbish
• Value isnt about positioning and image
  mongering, its about real performance and
  delivering on promises

5
Why is Value Important?

• Profound changes in todays marketplace
• Customers have better information and control the
  transaction.
• High debt burden-with added concerns of college
  tuition and retirement.
• Consumers know most products are at a parity and
  no longer believe the hype related to a product
  unless its clearly superior.

6
Why is Value Important

• Customers want products that perform sold by
  advertising that informs. Customers buy for
  intrinsic value and not to simply impress others.
• The Internet reinforces this trend focusing on
  information versus persuasion.

7
Value as a Buzzword

• Many marketers simply use value on packaging or
  in advertising.
• In many cases value is a euphemism for a price
  cut.

8
Assessing the Value You Create

• The Value Chain Concept
• Every firm is a collection of activities that
  are performed to design, produce, market, deliver
  and support its products or service. (M.
  Porter)
• Look at every aspect of your business from the
  consumers perspective and ask if you are
  creating or adding value that will allow you to
  charge a price premium.

9
Assessing the Value You Create

• Value doesnt always mean offering more for less.
  The right feature or product attribute can enable
  a marketer to charge a premium, even in this
  frugal era.
• The added features must be viewed by consumers as
  benefits.

10
Assessing the Value You Create

• If you want to create value, study your failures!
• The key to value creation is organizational
  learning and the key to organizational learning
  is grasping the value of failure. (F.Reicheld)
• The lifeblood of adaptive change is employee
  learning and the most useful instructive
  learning grows from the recognition and analysis
  of failure.
• Institutionalize the study of failure.

11
Creating Value - The Short-Term

• Value marketing can be a double bind with added
  production costs at lower prices.
• Value marketing will be implemented by the
  leanest, toughest competitors.
• Value marketing is what the Japanese automakers
  have done in the U.S. for years.

12
Creating Value - The Long-Term

• Creating increased value is a way to strengthen
  brand identities. Marketers have educated people
  to expect low prices that undermine brand
  loyalty.
• For those that figure out the equation, value
  marketing can be a way to make your brand mean
  something again.
• Value marketing could be a way out of the
  discount trap. A brand that has value is worth a
  premium.

13
Creating Value Summary

• Value is very important in the marketplace.
• Value is not a price cut.
• Marketing should be viewed as part of a system
  designed to deliver increased value.
• Think of your organization in terms of the value
  chain and look for opportunities to add value.
• Use failure as a means to improve or increase
  value.