Let’s take a deep dive into the concept of value. In our elite advertising training program, HemonX, we teach a heuristic approach to conversion science. In the heuristic, We teach that consumers will offset value against cost in their mind when making conversion decisions. The heuristic calls for you to use your knowledge of marketing tactics to enhance the perceived value of your product or service in the eyes of your ideal future customer. It would, of course, be helpful to fully understand what value means in this context, so let’s start there.
If you run a simple google search, you’ll find that value is defined as the regard that something is held to deserve; the importance, worth, or usefulness of something. This is a fairly straightforward concept, so let’s not muddy the water. We want to, as marketers, make consumers feel like our products are important, worthy, and useful. Simple enough.
Moving this important concept over into a marketing application, we might say that value is the difference between a potential client’s evaluation of the benefits and cost of our products or services when compared to others in the market, the status quo, or doing nothing at all. There can be a few different types and applications of value, but mostly it’s what you think it is. The following are three types of marketing value. There are probably more, but these three jump out at us:
Functional Value. This refers to the utility of your solution based on the amount of relief a consumer can get for their pain, angst, need, etc. Functional value marketing strategies can be built on the utilitarian or physical performance of your products and services. For example, if your offer teaches entrepreneurs how to grow and scale their business, then the functional value of your product is the pain relief associated with breaking out of an earnings plateau and moving to the next level of income. Likewise, if you are a fitness professional, your functional value is alleviating the pain of being overweight. This is perhaps the most straightforward application of value in marketing.
Social Value. This type of value is attributed to how much owning a particular product or paying for a specific service allows your customers to interact with others and connect with their peers. It’s not as visceral as functional value, and often functions pretty poorly if used exclusively as the hook in an ad. But, it can be layered on top of functional value to achieve some pretty outstanding results. Example: Jeep has a vibrant community of devoted customers who love to hang out with one another, hit the trails, customize their rides, and purchase Jeep merchandise. One wouldn’t sell the car based on the community alone. It still has to have a good engine, nice design, decent price, and all the other value prompts that cause people to buy cars. However, the addition of the social value of the Jeep community can spark purchases in people who are on the fence, or who desire to be a part of something bigger than themselves.
Psychological Value. This is the feel-good factor owning your product or service can provide your customers by allowing them to express themselves, or otherwise addressing any major component of Maslow’s hierarchy of needs. This includes physiological needs such as housing, water, and food. It also includes safety needs, love and belonging needs, self-esteem needs, and self-actualization needs. People like Jay Shetty make their bank on this type of value. It lets you encourage desired behaviors by appealing to your audience’s wants and needs with subtle but effective messages that ease the decision-making process.
When you’re going about suring up your value communications, make sure you’re engaging with the full range of possibilities based upon these value types, and you’ll be sure to raise your conversion rates.