Behind every purchase decision is a type of value that the buyer has decided much prior to the purchase. While customers are assessing brands at different Moments of Truth, brands are leveraging all opportunities available, to deliver maximum value. When these companies position themselves as a trusted advisor, customers will check how it fits into their value system. Having products and services fit into categories of values can help brands target specific audiences. When consumers find the ‘right match’ for their value system, they have an opportunity to become a long-term buyer.
In this blog, we will discuss the importance of value and the types of values segregated as per a customer’s purchase decision.
How is A Customer Value Defined?
The price of a product is measured by the currency. In literal sense, what you pay is what you get. In marketing terms, there is more than just a monetary tag. A customer would like to get more from paying just the price. The benefits need to outweigh its transactional value. If you offer greater benefits while keeping the price within acceptable limits, customers may attach a sense of value to the products and services.
Customer value = overall customer benefits > total customer cost.
What are the Types of Value in A Customer Purchase?
Each product and service has a certain value attached. There are five types of customer values to explore. Here are some examples of values which are segregated based on how a customer will perceive the purchase value.
1. Functional value: Will this be useful in the long run?
This is called the functional value. Products are seen with a utilitarian purpose. The product should serve the end goal of the customer. Customers expect reliability and efficiency as a basic expectation. However, products will have certain enhanced features that can offer greater outcomes.
For example, a branded light bulb that is brighter than a generic bulb. This will help the user see more and better with a branded bulb. Goods such as electronic appliances and furniture come with special features that will ease the daily life of a consumer. People might be looking for an alternative to help ease their daily hard work.
2. Social value: Will this amplify my personality and causes I support?
This is known as the social value. Customers in this spectrum make purchase to be a part of a good cause. They also see products as something that will allow them a sense of self-expression (including showcasing their personality). The products in this value category can do three things- offer self-expression, provide personal meaning and offer social meaning.
For instance, drinking coffee at a premium coffee chain can be seen as a premium experience for some customers.
3. Emotional value: Will this protect me from external harm or offer support?
This is the emotional value. In this value category, a user will respond emotionally to product/ service offering from a brand. Buyers will look at offerings in terms of ease of use, psychological help, reduction of risk and overall sacrifices attached to using the product. In this value segment, banking sectors that can offer low risk investment opportunities for all their customers.
Another example is anti-virus software that can offer a sense of relief for users who want to protect their sensitive data from prying eyes. Brands offering products under ’emotional value’ should know that customers seek a low-risk environment and human interactions with that brand.
4. Conditional value: Will this be available for me during an event?
This is the conditional value. As per this value system, people perceive products according to its use in a very specific situation. For example Starbucks offers pumpkin spice latte only during specific winter months. The value of these products that serve specific events will increase when the event is approaching or nearby.
5. Epistemic value: Will this offer me a brand new experience or knowledge?
This is the epistemic value. This value category is generated by consumers who are looking for a new experience, a learning curve or are curious in general. New products, restaurants or educational platforms often fall in this category. People try to acquire new information for personal growth. When services focus on good staff behaviour, cleanliness, friendly staff, quick and personalized customer support, this can heighten sensory experience.
How to create valuable customer experiences in a business?
Marketers have to gauge the core values of the company and create marketing communications around on the basis of these value systems. When this is check-marked, identify pain points, address them actively via various touchpoints. Create systems that can ease the process for every new and existing customer. Here are some ways to create valuable experiences in a business.
Identify customer expectations and close that gap
Today’s customers are well versed with market offerings. They come with prior research but they are still clouded with doubts. Identify their expectations and needs and discover ways to close this gap. While options are limitless for buyers, capture their interest as soon as possible at the initial touchpoints.
Do not leave potential buyers in the dark
This includes offering extra information or service especially in the physical stores or via website chat bots. Staff can be equipped to handle customer queries in stores and offer impromptu solutions. On websites, chat bots or live-chats can offer feasible solutions.
Create interactive survey channels between customers and brands
A happy customer will share experiences and positive testimonials. An unhappy customer can ruin the online reputation and become a churned member. Be responsive and close the feedback loop during negative feedback. Customers are constantly communicating with brands. Ensuring seamless conversations among touchpoints can help with the onboarding processes for new customers.
Collect customer feedback via omnichannel surveys
Focus on survey channels that are interactive, frequently used and offer a high survey response rate. WhatsApp surveys, Facebook messenger surveys and chatbots have the ability to capture customer experiences right as they happen. Multiple survey channels can reach a broad audience who are geographically distant.
Conclusion
People have their own set of religious beliefs and moral values. Similarly, people will also try to make purchases that will fit their world view of personal values. Every purchase has an intent. For example, people may choose to consume vegetarian products based on ethical values revolving around fairness and kindness towards the treatment of animals. Other purchases can elevate someone’s social status or ease their daily work schedule. What connects all of the customer’s is their quest to get a seamless experience at every organisation. It becomes important to know how your customers feel at every touchpoint when they come with the intent to purchase.
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