Market Your Product? Look for Ways You Can Manage Perceived Value
February 24, 2011
Ernesto Sirolli in his book Ripples from the Zambezi (a business book even if it doesn’t sound like one) cites three key business areas as his “Management Trinity.” He says, “If one is missing, the business is not a business, it shouldn’t be called one, and it will never succeed. No matter how big or small a business, three areas must be handled:
- Technical skills to produce the goods or services (whether shoes or travel tours)
- Ability to market one’s goods and services
- Ability to financially manage one’s affairs.”
I’m not much in favor of long, multiple step guidelines, so we simplify the steps into one statement – “Manage perceived value.”
“Technical skills” produce “value.” Making the absolute best product isn’t enough; it has to have user value. Many early PC manufacturers engineered ultimate machines, only to find the public couldn’t handle (and thus didn’t want) complex functions. “Value” was an easy-to-use machine to make routine tasks easier.
Instant contact glues (Krazy Glue, etc.) originally came in a two-ounce bottle, half of which was thrown away when drips glued the cap on. Quantity was not value. Now you buy one-tenth the volume in three one-use tubes (at same price) but there’s a lot less frustration because you use it efficiently.
Are there ways your staff skills could produce more value, not just in faster production but in a more customer-attractive product or service? Customer requests and unusual applications are a good first step. There are probably others out there who would like to learn about that value. Can you combine production steps AND improve your final product? What resources do you have that aren’t being used? Disney World boosted revenue by opening all night for high school graduation parties. Think.
”Market one’s goods and services” relates to “perceived” and usually gets a lot of planning attention – “How can we sell more?” Improve perceived value of your product by focusing on benefits (not features) in your sales messages. Focus ads on their problem that you solve, not on what you do. Sales pitches should start with “what is your biggest problem” not “here’s what we sell.”
The saddest words a salesperson ever hears are, “We just bought one. I didn’t know you did that.”
Improved perception comes from sending messages where your target market gets new information – Facebook, Google, newspapers, magazines, seminars, trade shows, etc. Target your prospects’ “watering hole” – make a few visible connections, not a bunch of invisible ones over the year. Be perceived.
“Ability to financially manage” is more than a prompt monthly statement (although knowing last month’s results by the fifth of this month allows you to take informed action for the next 23 to 26 days).
“Manage” means every asset allocation. Are you priced to capture ALL the value you provide? Do you have the right people (assets) in their best slot (value) to produce value? Could you manage inventory more effectively? Sometimes that’s more inventory to improve delivery times, sometimes it’s less to lower investment. Most importantly, do you have someone polite and firm (NOT your sales people) who will make continual calls to be sure you get paid for your effort?
Manage is an active verb. If you have a staff, it’s also a collaboration verb. Gather ideas from everyone you work with. Many won’t bear fruit, but a good idea can come from almost anywhere.
Sirolli says that it’s difficult for one person to be passionate and proficient enough in all three areas to competently produce the product, market it and manage the finances. (Personal example: I hated accounting. It was the second job I off loaded.) He says identify what you are most proficient at and most passionate about, and then find a partner to improve the other two areas — hire staff, use services, work with consultants, whatever. Get someone proficient and passionate. Sirolli notes, “Plenty of people try to do all three, many do it badly. Successful businesses are always a team effort.”
In 44 years of marketing, I can’t think of an instance to refute that statement. Want your 2011 to be a better year? Manage perceived value.
Perry Ballard founded a marketing communications firm in 1977 and built it (with help) to a team of 28 professionals, a payroll of more than $1 million, and a list of hundreds of manufacturing and service clients. Now retired, he consults, teaches marketing and writes on business topics. He can be reached at firstname.lastname@example.org.