What is product value?

Product value tells you what a customer gets from buying your goods. Being subjective means different things to different people, depending on their needs, wants, and hopes. Simply put, it makes people want to buy your product.

You need to know the difference between actual value and perceived value and between comparison value and absolute value to fully understand a product’s value.

When you compare your product to its main competitors, you can see how well it meets customer needs.

• Absolute value is how well it meets a customer’s wants or solves their problem, regardless of other options.
• A customer’s subjective opinion of your product’s worth is based on how they see its features and benefits and your brand, marketing, and image.
• Real value is how much your product is worth, considering how much it costs to make, what materials it’s made of, and how well it works.

You’ll need to consider each measurement when positioning and setting your goods apart. There are likely other goods on the market that offer better value than yours if yours has a high absolute value but a low comparative value. Your product is unique and doesn’t have many straight competitors if it has a high comparative value.

The exact value of your product changes from customer to customer, but certain benefits and use cases tend to make your product more valuable for most customers. You can’t make everyone value your product the same way. As a business, your goal should be to give the value that most of your target market is happy with at a price they all agree is fair.

Synonyms

• Product-market fit
• Product value proposition
• Product value statement

How Important Product Value Is for Getting and Keeping Customers

You can’t sell or offer something that isn’t built yet. Strategy for the product comes first.

Value is an integral part of getting new customers and keeping old ones. This basic theory makes that point clear.

Getting new customers

You need a more valuable product than your competitors to get new customers. You can show potential customers how valuable your product is and persuade them to choose it over other choices if you have good marketing and sales strategies.

This is why knowing your customers and what they want is so important. You can better make your goods fit your customers’ needs and give them value they can’t get anywhere else if you know more about them.

How to Keep Customers

Once you have a customer, you must keep giving them the same value. Customers who are happy with your product and see the benefits you promised are likelier to stick with it and tell others about it, increasing your retention rates. Instead, if your product doesn’t offer value or is overshadowed by competitors, you could lose customers and hurt your brand’s reputation.

Putting a Value on a Product

How you decide how much your product is worth will depend on

• what it’s
• what else is it up against?
• how other people feel about it
• whether your business is B2B or B2C

Here is a general outline of how to describe different parts of a product’s value:

Value in money

The price of your goods and how much people are willing to pay for them is called their monetary value. This is affected by a few things:

• How sensitive is your target market to price changes?
• How many people are paying for similar goods right now?
• How simple it is for them to get to those choices

A customer’s primary consideration when choosing is usually how much something costs. They are less likely to buy something if the price exceeds the reward.

Money is also the best way to level things out. No amount of value offered will convince someone to buy if they can’t afford it or don’t want to pay the price.

Value for Function

Functional value is all about the core features and functions of your product that directly solve a customer’s problems. This value is essential because it tells you if your product is valid and does what it says it will do.

Some things that affect applicable value are the following:

• Functions and traits
• Interface for users
• Simple to use
• Easy access
• The ability to integrate
• Visual appeal and style

Functional value is usually a mix of several things that can be different for each customer. People will have different ideas about how useful your product is depending on their industry, age, gender, and personal tastes.

Value to Society

People think they belong or have social rank when they own and use a particular product. This is called social value. It might not seem like this value is significant, but it is a big part of how customers act.

This is how social worth can affect your clients:

• Reputation and picture of the brand
• Proof from other people, like reviews and comments
• An emotional link to the brand
• Being linked to prominent figures or people who set trends

Some customers may choose your goods over a competitor’s because they have more social value. Customers are more likely to see the value in your product if they know it can help them make friends or improve their social standing.

Value in the Mind

People decide to buy something because they want to feel a certain way, in addition to how being associated with a product makes them feel. The mental benefits a product can give are its psychological value.

Most of the time, people want to feel one of these:

• Feeling sure
• Protect
• Safe
• Good for you

Glad

• Happy
• Calm down

A lot of the time, psychological value grows out of social value. People are more likely to buy something if it makes them feel good or helps them deal with bad feelings.

When it comes to business-to-business (B2B) products, businesses use psychological value slightly differently. Prospects should feel they can trust and depend on the product to help them reach their goals. This is the job of the salesperson or account manager.

Value in Things Vs. Value in Ideas

Once you’ve looked into these areas, you should divide your product’s value into two groups:

• Visible and intangible.
• Tangible value means benefits that can be measured, like lowered costs or better workflow.

Intangible value is more subjective and can be made up of things like how the customer feels, how the brand is seen, and how appealing something is to the heart.

When people compare your product to others, they’ll think about how important its monetary value is compared to its psychological, social, and practical values. People are spending money to buy from you, so you need to make sure that your product is valuable in these ways and that the price is fair.

Value Proposition for the Product

Once you’ve arranged what makes your product valuable, you can write a clear and convincing value statement that tells potential customers the benefits.

To do this, you need to think about:

• How do you see your dream customer?
• What do they need, and what hurts them
• How does your product fix those problems?
• What makes your item unique?

By making a list of your brand, product, and customer traits, you can make a value proposition that goes directly to the people who would benefit the most from buying your product (and have the money to do so).

How to Make a Product More Valuable

Change the value proposition to meet customer needs

The problem might not be with the product but with the way it’s being sold. When a business is still trying to find the right product for the right market, it often feels like this. They know the product helps people, but they don’t know what the most critical value is to share with those people.

Customers who don’t know anything about your goods will need you to tell them how valuable they are. If you can’t properly communicate the value of your goods, you’ll know because you won’t be able to make many sales.

To change your value proposition:

• Talk to your clients:  You should talk to your customers to find out what they like best about your product.
• Look for trends: When you get customer feedback, look for themes and put them into groups, like monetary, practical, social, and psychological value.
• Put the most important ideals first: Determine which value offer will work best for your target market based on what they’ve said and what you know about them.
• There’s no need to start from scratch here. It’s as easy as putting your answer right in the middle of your proposition, along with the keywords and pain points that your customers keep bringing up.

Change who you’re after.

You know the problem isn’t communicating the value if you have a reasonable conversion rate and your sales process is going smoothly. If few of your customers stick around after the initial sign-up, your product might not fix the right problem for the people you’re trying to reach.

Here are some usual situations where this might be useful:

• Your ICP is too general, and your marketing needs to be more detailed.
• You’re trying to reach too many types of buyers at once.
• You’re going after a group of people who need different help or answers.

In these situations, think about the people stuck with your goods.

• In what ways do they go together?
• How do they often get used to each other?
• Which benefits do they look forward to the most?

By answering these questions, you’ll be able to narrow down your customer groups and focus on the traits of your customers that should guide your targeting.

Analyze your competitors.

If you compare their products to theirs, you can determine where you fit in the market. Some customers would be better off with a rival. Your goal when communicating the value of your product should be to get rid of as many of those customers as possible with your messaging and product features.

• Look at the features and functions of each one. Check out what your rivals offer regarding real value, like features or skills.
• Check out the messages. Check out what your rivals say on their social media, paid ads, landing pages, and emails. Think about what makes your goods unique.
• Look at how the customer felt. Think about how easy it is for customers to use your product compared to others on the market. This includes things like training, hiring, and customer support.
• Know what makes your product unique. Make a map of your competitive market showing how each competitor is linked to you and what they’re trying to beat you.

Put in Functions

If you’re already getting good engagement and sales results, you should return to product creation.

There are a few different ways you could build out your product:

• Integrations with partners. When you work with other apps, you can give your people more features without building more infrastructure. Additionally, it helps both you and the partner get more customers from each other.
• Make it possible to change how the product works to get business customers; you can start offering bespoke development and customization services that give customers more control over how the product works.
• Make it mobile-friendly. Depending on your use case and target group, this may or may not be necessary. However, it would be best to consider buying a separate app or making your web platform mobile-friendly.
• Cover business tasks that go hand in hand. This could mean that next, a SaaS tool for business banking could add software for financial modeling, payroll, or accounting.
• Make small services. You can add each new feature as a microservice if you don’t want to add it to your main product. Because of this, not all DealHub customers need CPQ and billing tools. Some people need both CPQ and billing, and some people need billing. That’s why we made billing a separate offering.

Before adding a particular feature, have your product managers and our sales, marketing, and executive teams discuss why the feature should be added.

Change how you set prices.

Price optimization isn’t a perfect science, and no single answer works for everyone. You could, however, try the following to make your offering more valuable:

• Bundle features and goods to get a higher AOV. Since everything is in the same UI, the more of your goods they use, the easier it will be for them to do everything. Plus, they won’t have to pay a competitor for that job.
• Prices that change. You can charge different amounts based on how much and often you use it. Optimize this with AI and handle the work your sales team needs.
• Different prices. Offering different levels of service or usefulness at different price points can help you reach more customers, some of whom might not get the most out of one price level. This is similar to bundling.

Make things better for your customers.

To increase the value of a product, you need to mix its usefulness with an excellent experience for the customer. That’s what makes people feel good about your business and reinforces the value of your product all along the way.

To begin, map the customer’s path and mark the places where things go wrong. Here are some places to look:

• The way sales work
• Getting things done
• Training and getting new customers
• The product’s usability
• Interactions with customer service
• Renewal of subscription
• Communications for marketing

Any of these areas can be improved to improve the total customer experience and make the product seem more valuable. You might also want to set up a customer feedback system to get your customers’ ideas, tips, and requests for new features. This shows that you care about what they say and helps you figure out how to improve your product and message.

Boost Brand Loyalty

Emotional connections with your brand make customers like it in the long run. In return, they will be loyal.

• Build a group of people who use your product.
• Put on webinars.
• Set up a program for getting people to recommend you.
• Plan events for members
• Work with partners to set up co-marketing and co-selling programs
• Give great customer service

In addition to the above, use polls, social media monitoring, and your net promoter score (NPS) to determine how much your customers recommend your business. This will help you determine how your customers feel about your brand and the value of your products. And now that you know that, you can keep improving and growing customer trust.

The Link Between Price and Value of a Good

The pricing plan is essential. It’s not the price, though; it’s the value that makes the difference. When people compare the costs and benefits of a product, they are more likely to buy the one that offers better value at a fair price. You have to find the right price for the product so that it solves customer problems and makes business operations run more smoothly.

Remember that the value of an object changes over time and depends on the person who buys it. It should change as your business grows and to meet the market’s needs as it changes. Using the tips in this piece to constantly evaluate and improve the value of your products will positively affect how customers see them, how long they stay with you, and your sales.

How to Use Product Value to Get More Market Share

Make things urgent

Regarding B2B SaaS, you might not want to make seasonal deals for your product too often. Customer retention is the most important measure because it tells you how much money you make from repeat customers. When people find out that your goods cost a lot more, you won’t keep as many of them.

Instead, it would be best to make the sales cycle feel more urgent by signing contracts, telling prospects how much it will cost them to wait any longer, or doing anything else that gets deals done. Most business-to-business sales take 104 days. The longer it takes, the less likely you will close.

Sign up for social proof.

In many ways, social proof can be found:

• Examples of cases
• Scores
• Customer Reviews
• Referrals from customers
• Support from influential people and experts in the field

You could use a customer advocacy tool to keep track of your customer success stories in one place and use them in your marketing and sales.

Solve your problems.

Before you try to sell your product, you should focus on your prospects’ needs with a solution-selling method like MEDDIC or the SPICED framework. As you learn about a prospect’s problems or goals, show them how your goods can help them.

You’ll talk about the perks that will get them where they want to go during the sales demo. This will help them see the value in your product faster and give your sales team a better way to deal with complaints.