Summary:Value factors are simply things that are valued – features, benefits and things that enable you to do the job you’re trying to do better. Weighing up value factors enables you to identify where you could bring more to the customer, by looking at what’s important to them.
Features or benefits
Value Factors is a catch all term I use meaning either benefits, features, jobs our outcomes. They are things that are valued. I use the term for all, because customers don’t always pick based on clear jobs or outcomes, they can also and often do pick based on features that they think are the best ways to meet these jobs our outcomes. Sometimes they may not know why a new unheard of feature meets these jobs and outcomes better and so ignore it from their decision making process. You have no control over this initially, so this analysis reflects the reality, rather than a neatness that suits us!
However in order for Value Factors to be of real use, whenever a consumer tells you a feature was one of the reason they bought, you need to ask what that feature helped them achieve – what was the job or outcome it served? Only when you get to real jobs and outcomes can you find out *why* the product or feature was really chosen. You’ll know jobs and outcomes when you seem them, because they are things people want to achieve and have been around hundreds of years. “5 meg broadband” is not an outcome it is a feature – “maximise speed of delivery of information” is the outcomes!
For example, consumers may decide when buying a broadband line – “I want at least 16 meg broadband (feature) and it has to be quick (outcome) and never drop out, (outcome) plus is needs a child protection function. (feature)”. Now you may have a new product that isn’t broadband – say – “Megaband” but you still need to speak in a language that current customers understand. It’s no good going behind the benefit of the 16 meg feature (speed) and just offering “4 meg megaband”. The customer doesn’t know what that product or feature is. Instead you would say, “4 meg megaband – twice as quick as 16 meg broadband – at the same price”. Bear in mind too that customers are familiar with broadband, they see the value in it, what about megaband? Can they trust what you are saying – can they easily perceive the value? It’s likely you‘ll need to factor in a lot of time and cost to educating customers about just how megaband is different to broadband in the ways that customers value.
Value Factors as benefits are Ultimate Goals, jobs and outcomes. Value Factors as features are functions that help people achieve those Ultimate Goals, jobs and outcomes.
You can think of this as such,
Ultimate Goal or Job or Outcome -> Benefits Sought -> Feature
As I’ve said, it’s always best to look at Ultimate Goals, jobs and outcomes. Using the term Value Factors just help you remember that all these things are about value, and all that matters is what customers see as the best value – whether it really is or not.
Priority Value Factor and Key Value Factors
The Priority Value Factor is the one job, or outcome (or expressed as a feature or benefit) that matters to the market segment the most. It’s is the most important factor in making a decision. The one thing that if you said “What’s most important to you here?” they would choose. As you’ll see later it may or may not be well satisfied, but it is always the most important thing.
The Key Value Factors are the group of next most important Value Factors and usually number no more than three to six. Whilst not as important as the Priority Value Factor they have great influence on buying decisions too.
Contained within the Priority Value Factor and Key Value Factors can be as much as 80% of the Important Value consumers seek.
Beyond these are standard Value Factors, usually many in number they often comprise only 20% of the total importance of Value sought.
These lead us on
Value Factor Assessment
When we assess Value Factors we can therefore do so in several ways that differ in scope.
We always use Ultimate Goals, jobs, and outcomes. However we can assess them across a product niche, a product, product variations, a group of similar products, a group of substitute products, a job or an Ultimate Goal.
For example, we may look at Value Factors for
- Product niche – custom essays 2:1 standard on 3-hour delivery
- Product – custom essays
- Product variations – custom essays, essaybank, essay editing
- Group of substitute products – custom essays, essaybank, essay editing, tuition, model answer books
- Jobs – write an essay, had in a good essay, cheat
- Jobs – get an education or compile information
- Ultimate Goal – degree or to get a better job
All the above are just semantics, what’s important to realise is your level of analysis depends on what situation you are in and that you use the right one.
So you might want to assess features of a product across industry competitors to see how you are doing. At the same time though, it would be worth looking at what jobs and outcomes those features meet. You may find that other features could do better at meeting the jobs and outcomes that people really want. For example, you see a feature from a competitor called a “£1000 No Plagiarism Guarantee”. You think you could offer a £2000 one, but your colleague has the idea of offering a free plagiarism scan. When you look behind the feature, you see the benefit it provides is a plagiarism free essay, that’s the outcome the user wants – to minimise the chance of receiving a plagiarised essay! Both the feature and the outcome are Value Factors, so when looking at the features it’s just a matter of choosing which satisfies the outcome best, or using both.
When using Value Factors, if you just look at industry competitors you are forgetting that your product is just there to do a job for people. So looking at the substitute products, or the job itself, is always essential. When you look at substitute products for example, you can take features from them and use them in your own products to help people do jobs better.
Neither way is right or wrong, the level of analysis to use depends on the circumstances.
Steve Jobs of Apple is a huge advocate at looking at how trends are moving. He believes you can get a general feel of where things are moving ahead of time and I agree. You have to aim a little ahead. If you react to what’s their now, you’re reacting to the ideas of 2 years ago. Ultimately, looking at the job to be done lets you see ahead of the curve (current trends), helps you think differently from the rest and will protect you from unseen innovations. Most businesses just look at products and try and improve them. That’s quite easy to do because they are right under your nose, but they are under everyone else’s nose as well! This type of focus is valuable; especially to keep ahead of competitors, but it will never lead to the next big thing.
When you look at jobs or an Ultimate Goal viewpoint, you look at the reasons people are selecting products in the first place. It gives you a far wider view of things than most companies possess.
In addition we can look at Value Factors across all of these types of consumer -
- Loyal Customers
- Customers
- Rare customers
- Non Customer that have ‘Ruled product’
- Non Customers that have ‘Never considered product’
- Customers of other products
- Customers of other companies
- Key influencers – spouse, kids, buyers, payers, experts and so on
- Our own interpretations
Love and hate
I try to keep repetition to a minimum, but remember that value is these benefits minus detriments, as perceived by the buyer – detriments are functional, psychological, emotional, time, convenience, social or financial.
Value Factors as the benefits and/or features that are required from Ultimate Goals, jobs and outcomes to be completed successfully and thus can either be
- Functional – e.g. better, more reliable, more durable
- Psychological/emotional – e.g. trusted brand, respected brand, well known brand, brand with attributes
- Time and convenience – quicker, easier
- Social – fitting in, looking successful
- Financial
Your goal is unique superior value – value that matters in the most important ways to consumers and is very difficult to imitate.
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