If you want to be valued, you have to give value.
Moreover, values contribute to quantifying value and to determining buying actions. Therefore, expansion and retention of product ranges, service standards, staff numbers, retail networks, integrated supply chains, instore and online purchase options, payment systems and bundled or packaged offers are inextricably associated with the concept and calibration of value. That is, always be sensitive to the value of all, and less influenced and responsive to the price of everything.
The price-discounting treadmill is, figuratively, easy to jump onto but extremely difficult to leave. Client and customer expectations are rapidly conditioned only to contemplate and, when buying products, services and applications, are discounted. For businesses, this is not clever marketing. It is dumb, largely unprofitable and tends to lead to sub-optimal performance and failure.
When price is the sole or dominant reason for purchase, the tenuous hold on the client base is determined by price. It is one variable that competitors and substitutes can, and regularly do, manipulate to their immediate and short-term advantage. They too are vulnerable to customers and consumers who do not, or are not educated to recognise, respect and respond to value. Stand proud and steady.
ROADBLOCKS AHEAD
Here is an interesting case study on value.
Professional and industry association executives bemoan that memberships have progressively declined recently.
Not surprisingly, members see little value in annual fees that do not give them advantages, benefits, and ongoing rewards.
Reductions in membership fees and activities exacerbate the issues. Present association programs often centre on one major annual exhibition, a golf day, and a Christmas-period social event.
Association staff numbers, premises, infrastructure and resources have been typically trimmed.
Sadly, many business development opportunities for existing, prospective and past members are lost because of negative and limited mindsets, inadequate capacities and capabilities and an outright dismissal and denial of positive proposals.
Over time, continual and persistent economising induces “corporate anorexia”, in which the body consumes itself.
Self-fulfilling philosophies like “we don’t have the finances or resources to do anything other than what we are doing at present” establish their perspectives, perceptions and realities.
Whatever happened to the mantra:
Be Bold, Daring and Different
Now is the time to invest in the future. Resources, capacities and capabilities come first.
ROBUST NETWORKS
The four central Australian banks have learnt an expensive lesson. Substantial and accelerated branch closures impacted the national networks and brand names. The consequences were perceptual, financial, social, and commercial, well beyond the geographic boundaries of the specific branch locations and communities.
Contemporary global forces promote, encourage and facilitate mobility. Vacant premises leave lasting impressions on the broader landscape. Visiting account holders expect, no, demand ready access and convenience to the full suite of services to which they have become accustomed.
Value comes at a cost. It is a principle often lost on some bankers, accountants and economists.
However, it seems some bankers are learning. It has been at their costs.
DIFFERENTIATION
Small, independent, and local retail pharmacies have been invaded by major corporations entering the sector, particularly upstream in national, regional, and local supply chains.
Volume purchasing has been and is beyond their abilities. Therefore, competitive and compelling discounting is not a viable marketing and operational alternative.
Interestingly, (no, intriguingly) and significantly more than 75% of those in this loose collective have provided home deliveries and personalised managed therapeutic care for some time. Overall, they decided not to profile the services lest they become popular, burdensome, and increasingly a larger component of total business and revenue. Speechless.
Recipient customers value personalised, confidential, monitored, and therapeutic care. The value-worth transcends any calibration based on price.
The offer is not widely known, and many are bemused by its reasons. Additionally, select retail pharmacists are financially underperforming.
HIRE AND HIGHER
Value for some comes in delivering products, services and applications in new, differing and enticing ways.
Capital equipment can burden many balance sheets, particularly in mining and infrastructure.
All competitors and suppliers have fine-tuned price, quality and value. Differentiation is difficult.
Therefore, offering capital equipment on lease and longer-term hire is attractive and financially rewarding. They are also the basis for establishing sustainable relationships and enhancing cash flows via dedicated service and maintenance agreements.
Same prospects, different perspectives, new opportunities. That’s valuable … and value.
A TASTE OF HONEY
Aviarists around the world are experiencing tough financial times. Demand remains high and constant. Commoditisation precludes the opportunity to seek and set premium prices… for many, but not all.
Branded products and ranges, like Manuka honey, have been exploited to some advantage. However, legal and operational disputes centred on authenticity have compromised the value-priced offers by aviarists in New Zealand and Canberra.
An outstanding example of developing, packaging, promoting, and globally distributing true and sustainable value is Kauring Active Honey from the regional community of York in Western Australia.
The unique and high antimicrobial qualities are good for consumers’ health and for the profitability of the business.
An attractive glass container of 500 grams retails for around $150.00 (AUD).
It’s little wonder that an international fund manager has invested millions of dollars to acquire 25% of the business and is facilitating growth in the substantial global distribution network. At those prices and capitalisation, value is tangible. Sometimes, you just have to believe and have a taste for value.
AI AGENCY
Value can be measured in numerous dimensions—quality, consistency, simplicity, endurance, alleviation from tedious, repetitive manual tasks, punctuality, and above all, time and timeliness.
Artificial intelligence can and progressively is contributing to each.
A small but emerging incarnation is the concept of argumentative purchasing. All in commerce must become familiar with the term and its many applications. Manufacturers, distributors, wholesalers, retailers, clients, and consumers will soon encounter AI agencies in which the process researches, finds, chooses, and purchases based on the belief of its principal (that is, potential, intending, and actual consumer).
Entities whose AI cannot interact with, engage with, conclude contracts with, and supply the AI agency will exclude themselves from prospective transactions, demand, profits, and cash flows.
Platforms, including Amazon, Google, Apple, TikTok, Alibaba, and Temu, know the channel, its applications, and its largely unfulfilled potential. Most are tentative about fully embracing it. Limitations exist, and worth can be determined by the benefits and parameters applied by clients and consumers.
The most active avenues are smaller, largely unknown and (to the extent possible) regional and national platforms.
Overall, the process addresses the need for retail channels to have sellers. The broader sector is mature and therefore has limited growth opportunities. This concept can change market shares.
Reality constrains AI agency when the emotive and evocative factors like colour, aroma, sound, space, movement and touch are foremost in the selection criteria.
Nuances are powerful, discerning and differentiating considerations. Red is not red. Just ask Ferrari.
AI agency fulfils the role of a third-party actor that can make purchases on its principals’ behalf. It is best applied when buying demands are highly contextualised, that is, when customers know exactly what they want. For example, tickets to a Taylor Swift concert, seats to the National Rugby League State of Origin matches, major social events, and Black Friday (etc.) purchases are expedited and simplified when the decision has been made, but the process is time-consuming.
Purchases of packaged goods are more likely to be successful than with emotive, subjective fashion goods purchases.
ON BALANCE
Retailers, in particular, need to be aware of AI agencies, open and responsive to their presence, but not overly reliant on mass and volume sales. Major retail networks understandably are reluctant to be dependent lest they become fulfilment centres with little or no contact, interactivity, and engagement with their existing, prospective, and past customers.
At this time, the AI agency is not transformational. However, its presence could develop into influence and thus become instrumental.
Precedents have been established. Buyers’ agents abound in the marketplaces for new and existing homes. The one noticeable difference is the human factor.
IN CONCLUSION
People continuously make value judgments. Price is typically a small, singular element in determining the true worth of a value package.
To be valued, one must give value. This requires vision, discipline, commitment, adherence and belief.
True and sustaining value is founded on investments of time, resources, finances, self-belief, and pride. Returns can be slow at first. However, the consequences are cumulative and potentially exponential.
Visions of, and for value include provisions for innovation, creativity, change and progression.
Competing with and beating oneself underpins the realisation that market forces prevail. Finding “best fit” positions, maintains currency, relevance, resonance and value.
By Barry Urquhart – Consumer and Retail Analyst | Marketing Focus
BIO:
Barry Urquhart is a highly regarded market research and strategic planning consultant, recognised throughout Australasia for his insight, clarity, and thought leadership. A seasoned keynote speaker at premier conferences, Barry is also the acclaimed author of Serves You Right! And Service Please!, two of the region’s top-selling titles on customer service excellence.
Respected as a trusted voice in business strategy, Barry continues to lead influential workshops and development programs that help organisations drive sustainable growth, elevate service culture, and achieve competitive distinction.
For Media Enquiries or Speaking Engagements:
Email: [email protected]
Mobile: +61 041 983 5555
