IDEAS ARE PLENTIFUL
We’ve all been there. We’re doing something that tends to irritate us and we end up thinking “there has to be a better way.” Sometimes we just forget about it, but other times the gears start to turn and an idea pops into our head! 💡
And if you think about it, that’s probably the root of every product or service: a solution to someone’s irritation.
But the truth is that amazing ideas are plentiful. It’s the execution of an idea that truly matters.
Now we know marketing is extremely important to a product’s success. Without it, people won’t even know that your product exists.
So if you’re currently offering a product and you’ve thought through the Four Ps of Marketing, and it still isn’t selling, then you might have missed an important marketing philosophy. And that philosophy is...
Value = Benefits - Hassle to Acquire
This equation could be the one thing you might have forgotten to think through. So what does it mean? How does one utilize it? And why is it so important?
PEOPLE BUY WHAT THEY VALUE
The ultimate measure of your product is its worth, and I’m not just talking about its monetary worth.
Consumers purchase based on what they value and more specifically, it's about their perceived value of a product or service.
(Leave it to Harvard to explain it so eloquently).
More simply put, values mean different things to different people.
Some people value exclusivity, like a product that is very limited or “high-end.” Others value products that have longevity and want the most bang for their buck. And there are also people who value products that are environmentally friendly and are made humanely. The list of values can go on and on and people could very well consider multiple values before making a purchase.
People want their products to connect with their beliefs, so considering this equation helps you in building and developing your product’s marketing so that you can truly connect with your potential customer.
The equation means that someone’s value of a product all depends on the benefits the product brings to that person’s life, as well as how easy or difficult the process of acquiring that product is.
Let’s dive a little deeper by creating a product scenario and applying its properties to the equation.
So imagine that we’ve created a new energy drink that:
- boosts your immune system
- is made organically and humanely
- and gives you energy for hours
Now lets consider its benefits, how customers will acquire it, and ultimately its value.
The benefits of a product have to do with how its features enhance its customers’ lives.
The energy drink we’ve created offers great benefits, so I know I’d most certainly be interested in purchasing it. But what if you had to drive an hour to purchase it? (Ha! Plot twist)
Hassle To Acquire
Has your interest in purchasing it subdued? I don’t blame you. Having to drive an hour to acquire a product seems crazy, especially for a product I’d like to enjoy daily. I personally wouldn’t drive an hour to buy it, that just seems unreasonable.
That’s why considering a product’s hassle to acquire is just as important as its benefits.
The product's cost could also prove to be a hassle. Let’s take the same energy drink and change a few factors.
This time the energy drink is available at every gas station, convenience store, and local market, making it much more accessible.
You’d definitely check it out during your next visit to one of those locations, right?… But when you arrive, you see it’s priced at 10$ a can.
Now personally that just does not fit my purchasing values so I might try it once, but I doubt I’ll become a consistent buyer of this product.
And so we’ve come to its value…
As mentioned before, people view values differently. And in the case of a 10$ healthy energy drink, I agree with its benefits but view its cost as too much of a hassle, and in turn its not as valuable to me.
But that doesn’t mean that others will agree with me.
Salesforce, the one of the most highly valued American CRM/marketing companies, reports that “79% of high-performing marketing teams currently use predictive intelligence.”
This goes to show that research is such an important part of creating and selling a product. If your company doesn’t define or understand its target market’s values then your product might not sell.
ONE LAST EXAMPLE
The last thing that’s important to understand is how each part of the marketing equation can play a role in various product/marketing scenarios. I wanted to a share one more product example and how its value appears in different scenarios.
So imagine you’re at a baseball game. Your home team is winning and everyone is having a blast. You’re hungry and decide to go to one of the concession stands. You notice that there aren’t too many healthy options there. It’s almost like we expect to eat junk food at these events.
And that's no coincidence because junk food is being marketed for these events. From the signs you see as you walk in to the stadium workers who shout out their delicious food offerings. It’s like watching the Food Channel and not getting hungry, it’s impossible. So you’re only choice is to buy something delicious, but unhealthy.
So in this case, the marketing worked. Junk food has become synonymous with live events.
But what if you wanted to sell junk food at a health and wellness convention. In this scenario the participants of the convention pass many companies and organizations speaking about how to do to lead a healthy lifestyle.
Do you think that junk food would sell there? It might, but I doubt it’ll do well.
The people going to these conventions tend to lead healthier lifestyles and in turn probably eat what is considered healthier.
In the the example above we see that even an extremely popular category of products like junk food can fail if placed in front of people who won’t value it.
So before selling your product make sure to thoroughly think about that its value, how that value speaks to its target market, and where/how it’ll be sold.
Have you used the marketing equation before? How has it helped you develop and implement your product's marketing strategy? Share your experiences in the comments below.
- Business Marketing: Understand What Customer Value, Harvard Business Review
- Customers Buy Benefits, Selling Power
- 20 Shareworthy Stats from the “State of Marketing” Research, Salesforce