In our cash strapped times all we seem
to hear about is the need for competitive pricing and offering
consumers good value for money. These deceptively simple phrases
conveniently hide the fact that ‘value’ is a very relative term
which is used – and interpreted – in very different ways.
The relationship between ‘value’
and ‘price’ is not a straightforward one. John Lewis and Waitrose
are both premium brands which have managed to position themselves as
offering customers ‘good value’ despite their price tags. Their
offer is centred on great customer service and confidence in the
origins and quality of their products, which goes a long way to
justify the added expense.
For many consumers ‘value for money’
means investment. The initial outlay may be high, but the longevity
of the product and little need to maintain it means that a saving is
made in the long run. We can see this across a wide range of
categories from white goods (Bosch: ‘Invented for Life’) to
groceries (Florette: ‘Fresher for Longer’). And which one of us
girls has not at some point tried to justify those expensive boots
(bag/coat/etc.) by claiming that they will last for a decade longer
than the cheaper alternative?
It is hard to pin down the value of
something unique – which is why some brands use tailor-ability to
add value to their offer. Moonpig.com has pioneered personalised
cards, whilst Nike ID enables customers to custom-make their own
trainers. Such flexibility produces products that make consumers feel
special, and this emotional feel-good sentiment is impossible to
define in monetary terms.
Consumer need for ‘value’ but
reluctance to pay more for it has recently given rise to some
interesting communications.
In the context of current supermarket
warfare ‘value where it matters’ is a strong tag line. If
Sainsbury’s wants to keep its position as a somewhat premium brand,
it cannot scoop down to merely price-matching Asda. Focus on ‘Value’
rather than ‘Price’ keeps customers thinking about the benefits
of good food rather than their price tag.
British Airways are similarly at pains
to defend their apparently higher flight costs in the face of budget
airlines such as EasyJet and Ryan Air. Their latest ad campaign is an
aggressive defence move which seeks to show how low cost flying fails
to deliver on ‘value.’ Moreover, BA’s ‘value calculator’
demonstrates how EasyJet and Ryan Air’s potential extra costs can
rack up the overall journey price in a way that actually makes flying
with British Airways cheaper.
To conclude, some aspects of ‘value’
are emotional, whilst others – such as longevity – are rational.
But whichever principles you choose to adopt to demonstrate the value
of your brand do not forget:
PRICE IS A NUMBER ON A TAG. VALUE IS
THE BENEFIT TO CUSTOMER.
