I never used to understand what the term “added value” meant. It was partially because I didn’t yet own a small business, and partially because business concepts bore me to be brutally honest. The real reason, however, is because very few businesses are interested in adding value to their products. Why? Because it’s hard and it doesn’t result in more profit if you don’t do it correctly. I touched upon this topic at the end of one of my other articles regarding Facebook’s practice of “Reach Extortion”.
Instead, what businesses do is subtract value and keep the price the same. For example, I buy a ton of Froot Loops cereal. In 2008, Kellogg’s raised the price and reduced the size of the box by 2.4 oz. This way, they got more of my money per ounce. Sadly, this is the business model adopted by nearly all consumer goods manufacturers.
Take advertising for another example. How often do you find yourself actually sitting through commercials between segments of your favorite TV show? If you’re like most, you skip through them or get up to go to the bathroom. The commercials are boring, boilerplate driven content that becomes nothing more than static.
Now consider the Super Bowl. How many people have you heard say “I don’t care about sports. I watch it for the commercials”? Why? Because content producers actually add value by putting forth a real, concerted effort in what they present to consumers. And when they do that, we want to tune in and watch. You might say “Well sure, but that kind of effort is not sustainable in the long term. That’s why we don’t do it.” In some cases, you might have a point. Then again, I present the cases of Netflix, Amazon, and HBO.
There was a time when I grumbled after Netflix subtracted value by splitting DVD deliveries by mail and online streaming into two separate payment plans. I thought “Here we go again, the ol’ shrink ray at work.” Then I started seeing ‘Netflix Originals’ as a label. Curiosity got the better of me and I started checking out some of these originals and guess what, they were GOOD! Shows like Orange is the New Black and House of Cards really appealed to me. They were well-written, the cinematic quality was topnotch, and I found the storylines intriguing. The same was true of HBO.
I no longer grumbled at paying $8.99 a month for Netflix or extra for adding HBO to my cable lineup so I can watch Game of Thrones. Amazon told me last year they were increasing their yearly Prime membership fee by $20 to $99/year. I didn’t grumble. Why? Because not only did I already feel like I was getting good value for my money with the free 2-day shipping, access to Instant Video and the Kindle library, but Amazon was adding Prime Music and cloud storage capability. To me, it was worth the price increase.
All of this is to say that if we really want to entice clients, we should add value to our business. I’m certainly not suggesting giving more products away for the same package price. Rather, I’m suggesting that we should innovate and offer interesting concepts to entice potential clients: themed sessions (i.e., 50 Shades), improving customer service, state-of-the-art product offerings, etc.
Everyone’s at a different point in their business development, so it’s up to you to figure out what value you can add to your business offerings. I just don’t want your clients get up to go to the bathroom when you start talking about what you can do for them.