At its core, value-add marketing is defined by its ability to deliver more than your customers are expecting. It’s an empathetic approach. It is also one used now by more and more businesses in this day and age too. Marketing provides consumers with important information about your business. It lets them know who you are and what your business has to offer. Also, it tells the masses you are out there. It is a great investment for any business to make no matter what it is they do.
The current concept of added value
The concept of added value is, from a purchaser’s point of view, how to acquire more products or services. This is for your budget. From a supplier’s point of view, how to differentiate yourself from your competition by offering your market products or services which are perceived to be without cost. There’s nothing new in the concept – anyone that can remember Embassy cigarettes, for example, will recall the Embassy Tokens the packets contained. This is a major marketing concept.
There have been other means methods
Whilst similar techniques have been used, particularly in the FCMG sector, for years ranging from the incredibly popular ‘free’ gifts in cereal packets to stamped loyalty cards in pubs. Whilst the B2B sector has also used the technique, it hasn’t been as publicised – adding free services or products to a fixed price contract is nothing new and, unlike a discount, a company offering added value is adding something to a service already being provided, usually at no extra cost. What is new is that ‘added value’ is now expected and almost mandatory for a growing number of private and public tenders with the question of how a supplier will add extra value to the supply of a service or contract taking an increasingly prominent position. Any marketing agency will advise this.
What is important for suppliers
It is particularly important for new suppliers who do not have the benefit of a proven track record of delivery with a customer or customers, and given the number of start-up companies in the UK, 50% of which fail due to mirrored or duplicated services and products being offered at a lower cost or higher quality, it adds to the unique selling point and differentiates a business from its competitors. In theory, added value needs to be something others are not offering, giving that extra touch from your company which could make all the difference to the customer. In practice, however, it’s also now becoming so common, that the difference between the paid–for product or service and the ‘added value’ is becoming blurred in many cases.
A look at the construction industry
How many construction companies, for example, offer to take on apprentices when bidding for Housing Association contracts or developers offer to provide ‘free’ community facilities. In our own sector, the ‘free’ marketing audit is now being publicised as something different when it is simply normal procedure as part of the start of any new contract for most marketers. The cost of providing real ‘added value’ has to be considered. For many suppliers it may not cost them anything to provide but is perceived to be of high value by the client or customer. In this way both parties win – the customer is happy to get something they value that they’re not paying for, whilst the supplier has made the sale without having to lose any profit apart from, in many cases, some additional hours.
Marketing through a different climate
This duality between the best and worst of times is something that every marketer has felt. It’s this golden age where businesses are always accessible by their customers and vice versa. Marketers have more communication channels than they know what to do with. There are a more consumer insights than they can reasonably comprehend. Yet, these benefits are often marred by the challenges that come with them. They’ve made marketing more competitive and complicated than it has ever been. It’s hard to stand out and attract customers in today’s marketing world; it’s even harder to keep those customers.
There is, however, a solution for both these obstacles: value. Value is achieved through information (wisdom), creativity (a touch of foolishness) and establishing credibility at a time when many consumers are looking for signals not to believe a marketing message. The purpose of this discussion is to explore the concept of value-added marketing. and why it is necessary for today’s marketing climate. You’ll also be introduced to some strategies for creating value for customers.
What to also know about value added / added value marketing
This unique experience that gives products, services and brands much-wanted attention in crowded markets is created through value addition. As mentioned earlier, businesses used to achieve this strictly by offering financial value, like discounts, coupons, and other deals. Now, value addition marketing includes any tactic that adds to the customer experience, financial or otherwise.
Because consumers have so many options to choose from, even in niche markets, price and product quality are no longer enough to gain a competitive edge. Instead, shoppers look at the experience around the products or services that they are buying. What value is offered before and after the purchase? How does this compare to what other brands offer? These are the questions that today’s consumers pose. To respond, businesses need to focus on strategies for creating value for customers.
Getting value
Financial value manifests itself through the tactics that help customers save money. Value is created by allowing consumers to get more for less. Common examples of financial value tactics include coupons, discounts, reward programs, buy-one-get-one offers, etc. This monetary value can also be created by adding new features or qualities to existing products/services. When the perceived value of these additions is greater than the actual amount paid, then consumers assume that they are getting a better deal.
Non-financial value is often harder to define. It is created by strategies that add value to the brand experience surrounding your products and services. This experience happens before, during and after a purchase is made. Content and communication are two of the primary ways that businesses produce a valuable experience. Content helps customers understand the products and services being offered. This assists them in making smarter purchasing decisions. Communication, on the other hand, delivers customer service to solve problems that shoppers may encounter.
Overall
By definition, value addition in marketing is gaining a competitive advantage by combining, packaging, bundling, or otherwise adding benefits or features at a product level or company level. In other words, you can add value to a single product / service, or to the brand itself.
The purpose of value-added marketing is to go beyond customer expectations through the addition of these benefits or features. When companies are able to exceed expectations in helpful and new ways, they gain a clear edge over the competition. Remember, relevancy is key. You want to add value in ways that solve customer pain points and address their attitudes. This creates value by offering a feature or benefit that is missing from the market. And, it gives customers a sense that their feelings are recognized and appreciated.
