Content

• Steps
• Warnings

One of the most common reasons a venture capital business fails, large or small, is its inability to create value for customers. The concept of cost is one that is both simple and complex. It is simple because it has only three components, but complex because value can only be determined by the client and can include tangible and intangible concepts such as perception and opinion. This article has been intentionally simplified to introduce concepts in their most general form.

Steps

1. 1 Understand that the first component of value is "utility." This means that whatever you do for your client must be fit for the client's goals. In essence, for any product or service that you provide to a client, having utility means that the client can improve the performance of its assets, or remove any constraints that prevent it from getting more value from its assets.
   • If it's a car wash, the car should eventually get clean.
   • If it is a snow removal service, the client should be able to walk the road that you have cleared on their assignment.
   • If it is a cell phone, the phone must be able to receive the signal, the customer must be able to dial the number and talk to someone on the other end.
   • When it comes to a computer report, the client must be able to press a button, the report must come out of the printer, and it must be complete and correct.
2. 2 Be aware that the next component is Warranty. This means that the goods or services you deliver to your customer must be usable.
   • A car wash, for example, must be open at the time indicated on the sign, and it must be able to cope with the demand for its services, otherwise there will be a queue, customers will get tired of waiting and they will leave.
   • The service should be as safe as the customer expects, for example, there should be no undue risks to the driver or passengers.
   • In the event of a breakdown, the service must be restored within a short time, which the client considers reasonable, otherwise the client will go to look for another car wash.
   • The same principles apply to all other goods and services. They should be as available as the client needs, provide a margin of capacity to meet the client's demand, be safe as the client expects, and continuous if the client requires it.
3. 3 Strive to identify and overcome customer perception barriers. The easiest way to explain this is to remember the day you bought your last car.Why did you choose it? After all, all cars are the same - four wheels, chassis, engine, gearbox, differential, body, seats, steering wheel, glass, seat belts, etc ... Or not? The job of a salesperson who wants to make a sale is to identify those feelings and determine the best way to present the service - a car - so as to convince the customer that the vehicle meets all the requirements, is realistic and in line with expectations.
   • Some customers buy based on perceived reliability, personal experience and / or someone else's opinion.
   • Some are focused on price.
   • Some focus on power or cabin comfort.
   • Some people need speed, others think that there are always few airbags in a car.
4. 4 Customer perception is what makes or cancels a value-for-money transaction. For example, most people won't pay $ 100 for a can of stew, will they? Nevertheless, put the person in a situation where he has not eaten for several days, and apart from stewed meat there is nothing else to find, and the person will be ready to make this deal. The art of selling boils down to finding what the client considers to be their value and convincing them that what you have for sale will create that value for them.
5. 5 Remember that strategy and marketing are two different concepts.
   • In strategy, you take solutionswhat you will be offering that is of value to potential customers, how that value will be delivered, and how you will convince the customer that the value they want to have can be obtained from you. In short, it is about defining value propositions.
   • Marketing is about how convey strategy and value proposition to the customer in a way that will get them to buy a service or product from you.
6. 6 Strive for positive returns. Where does money come into play in all this? The client must understand that the total value of the service is higher than its cost and produces a positive return. Returns can be tangible (like a positive return on investment) or intangible (like increasing the customer's brand reputation or the goodwill of our customer's buyers). Keep in mind that sometimes intangible returns can be much more valuable than tangible ones!

Warnings

• Remember that consumer perceptions can change over time. If you provide services on a regular basis, it is important to ask the right questions and develop trust and credibility with the client so that you can detect when this perception changes and be able to adjust to the new definition of customer value.
• The biggest mistake you can make is to try to generate value for the customer without consulting them. In any business relationship, only one party determines the value of goods or services - the customer.