Most people know that the root of success in business is sales. However, your rate of sales depends greatly on how well your company is able to convert traffic into purchases; which can be significantly affected by your product’s customer perceived value.
In this article, we’ll explore the meaning of perceived value; how it pertains to your business, and how you can use the concept to dramatically increase your profits.
What is Perceived Value?
So what exactly is the concept, perceived value?
Perceived value is the measure of the level of value that your customers or client base hold for your business, product, or service. Essentially, it pertains to how they believe your product can improve their life—or not.
The Importance of Customer Perceived Value
Though your products or services are at the forefront of your business, your perceived value decides how often people are going to be moved to buy from you.
With high perceived value, you’ll have more success selling your product at a price that works for your profit margins. On the other hand, with low perceived value, customers may be unwilling to pay the cost that you believe your product is worth.
How Customer Perceived Value Increases Sales
Perceived value is balanced by perceived risk. If your product has a high perceived value among your customer base, your clientele is unlikely to avoid buying; just because they want to save money or don’t think it’s a good use of funds.
In this way, a high perceived value equates to more sales and greater revenue for your company.
Ways to Increase Perceived Value
Many brands feel lost when it comes to value creation, as it can be a difficult metric to track. However, there are a few concrete steps you can to change the way your customers view your products and their value. Let’s go over what these things are.
Work on Your Branding
In order to have high perceived value, it’s crucial to have a strong brand identity, to begin with. This means that you’ll need to develop distinctive aesthetics. Doing so will allow you to portray your brand as you’d like it to be perceived by customers.
Partner with Trusted Brands
If you’re having trouble building up brand identity, partnering with brands that are already established can help. That way, potential customers will perceive your brand as trustworthy and valuable by association.
Your packaging is one of the most intimate ways that your company personally interacts with customers. Make sure that your packaging is high-quality and able to reflect your brand aesthetic in a way that boosts the unboxing experience for customers.
Improve Credibility and Expertise
Your customers want to know that they can trust the quality of your product, as well as your business as an entity. One easy way to boost your credibility is to guest blog for other companies, a practice that casually introduces your brand in an accessible way to the loyal customers of a similar company.
Marketing experts insist that consumers value time more than they value money. Therefore, if your product can provide them with a feeling of time well spent or even time saved, they’re more likely to perceive your product as valuable and worth purchasing.
This approach can include the time saved while using the product, as well as the time saved with fast shipping.
Some companies choose to use the concept of value pricing to drive sales. Doing so allows them to market products as a great value for the cost (i.e., “more bang for your buck”). Furthermore, others push the concept of premium pricing. This push operates on the understanding that the product is extremely valuable within its niche; therefore worth a higher cost than competitors.
One easy way to improve your customer value is to offer bundle pricing. Not only will potential customers enjoy the savings that bundling options will provide, but your company will also see increased revenue due to higher amounts of products being moved.
Free shipping is another useful way to increase the value of your brand to your potential clients while also increasing the quality of the customer experience.
Reduce Perceived Risk
Even if your product wouldn’t be considered “risky” to use, your customers will experience a level of perceived risk when they’re deciding whether to purchase something from your company.
Another way to describe this phenomenon is perceived sacrifice or what your customer feels they will be giving up by purchasing your product. At the root of this concept is the perceived loss of an amount of money that surpasses what they think is fair or the perceived loss of valuable time.
As a business, you can reduce your customer’s level of perceived risk in a few ways. Clearly advertising quick and easy return policies, money-back guarantees, and ways to get in contact with your company will increase the level of trust between you and your potential customers.
Working with a famous or well-respected spokesperson will also help to add a feeling of intrinsic trustworthiness to your brand.
Hiring a third-party logistics company can also improve the quality and efficiency of your supply chain, which in turn will improve the customer experience.
As the experience of your current customers and their brand loyalty improves with increased value creation, new customers will be drawn to your business through word of mouth and other organic marketing tools.
Where to Go from Here
As you can see, the perceived value of your products makes a huge difference in the success of your business on several fronts. Among the many factors that contribute to high perceived value, proper supply chain management, strong brand identity, and concerted marketing approaches are just a few to contemplate. Looking to master the art of value creation for your brand and dramatically increase your company’s revenue? We’ll help you get there. Schedule a free consultation with one of the experts at Print Bind Ship today.