How do you define value? (4 tips)

We instinctively know when we receive value: the warm feeling of money well spent or a smug satisfaction of a bargain well and truly secured, but how do we know if we're giving value? Other than our sales figures and customer satisfaction surveys, what boxes need to be ticked to pass the value test?

1) Performance of service/product - Does it really do what is promised and more?
2) Affordability - Is it well-priced for what your customer pays and receives?
3) Ease of use - Is it easy/convenient to use?
4) Minimal risk - Is it free of risk/nasty side effects? 

Imagine the following scenario … if I had a headache and wanted to buy something to relieve the pain, I'd buy a product according to these 4 factors.

• Does it solve all the Pain (performance of product)? If the relief only solved 50% of the pain, I'd only buy it if there were no other products which could match it. Ideally I'd want something which would take all my pain away and the more I believed a certain product could solve all my pain, the more likely it is I'd make a quick purchase of that product and pay the asking price. If the pain was that bad and the relief that good, I'd definitely pay above the odds. 

• Is it affordable? If the pain relief I wanted was priced well above the market rate, I'd either buy a cheaper product, or I'd do nothing and put up with the headache. In this instance, I'd only consider the expensive product if the cheaper ones didn't work, or if the pain became excruciating and it was clear that the expensive product was highly effective. 

• Is it convenient? If the relief was affordable and solved my pain, but getting hold of it was inconvenient and involved a hike out of town, I'd be tempted to pay a higher price for a product which delivered slightly less pain relief, but was available in the store at the end of my road. 

• Is it free of risk factors? If the relief was affordable, solved the pain and was convenient, but it could make me nauseous, I'd think twice about buying it. I'd have to weigh up whether I'd rather be in pain or feel sick. The likely outcome would be that I would be prepared to spend more money on a different product in order to buy something which didn't make me feel sick. 

Clearly, as a business you cannot control your market environment, the pace of change, technological progress etc, all of which will have a bearing on how valuable your business/product will be perceived by the customer. But you can control whether or not your business/product continues to delivers value within that environment: make sure it always ticks 4 boxes - solves pain, affordable, convenient, minimal risk.

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Thanks for reading

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