The Importance of Creating Value For Customers
What is the importance of customer value?
- Improves customer brand perceptions
- Increases customer satisfaction
- Retains customers and provides a competitive edge
- Boosts profits
In business, customer value refers to the benefits that customers experience from buying a product. According to the best business podcast in the Philippines, the importance of customer value cannot be overlooked — especially during the pandemic — when it comes to achieving customer loyalty, gaining a competitive edge, and boosting profits.
Most business owners focus too much on the products they create when they should be focusing on creating value for customers and figuring out their needs. If your customers feel that they did not get enough value for the money they paid for, it will induce feelings of remorse and hurt your bottom line in the long run. Continue reading on to learn more about the reasons why customer value is important.
Improves Customer Brand Perceptions
Let’s say you’ve created what you believe is the greatest product ever. After investing ample time, money, and effort, you introduce your product to the market only to gather negative reviews. The truth is, the real verdict lies with the customer value you deliver.
Customer value delves deep into the core of a customer’s journey with the product. From the purchase intent, shopping experience, the actual purchase, down to the usage — all these factors play a role in creating customer value and informing them of how to perceive your brand. When you create products that deliver value, it shows you care about your customers.
Customer value improves brand perception which makes it so crucial for business success. It can be the defining factor that makes or breaks your business.
Increases Customer Satisfaction
Think about it. Your customers spend their hard-earned money to purchase your products. Of course, they will want to receive value that justifies their expenditures in return.
Keep in mind that your customer not only dashes to your store and pays for your products. They also exert time and energy to head to your store. Even when they buy your products online, they exert time to connect to the WiFi and browse your online shop.
As a business owner, you should provide value for their time and efforts, making sure they are not wasted. Part of creating value for customers is figuring out what will best fulfill their needs and eliminating what they don’t like in your product. In turn, your customers will feel satisfied.
Retains Customers and Provides a Competitive Edge
Marketing strategies and business strategies have evolved because customers became more aware of their preferences. To add to that, customers have endless product options and alternatives that can be easily accessed with a simple click of a button nowadays. Oftentimes, they will have little to no loyalty to spare if a brand fails to meet their expectations. So how can your business appeal to and retain its customers?
In today’s highly saturated market, many companies lower their prices when supplying products in an attempt to increase market share and compete with other companies. The downside of this, however, is that it can negatively affect profit margins and compromise product quality. This is why instead of lowering your prices to keep up with competitors, create more value for your customers.
The truth is, customers will compare the value of a product with a similar product when making a purchasing decision. When customers perceive that your products deliver value for the amount they paid for, chances are they will be more willing to stick to your brand.
According to research by Deloitte and Touche, customer-centric organizations are 60% more profitable than non-customer-focused organizations. This is because the former focuses on delivering value.
Businesses that don’t focus on creating value for customers run the risk of losing profit to competitors that offer similar products and better purchasing experiences. If a potential customer looks at your product and does not understand its value, it will be too easy for them to delay their purchase as well.
There are numerous drivers that influence a buyer’s purchasing decision. Customer value is one of those. It creates a sense of urgency that compels buyers to move forward with the purchasing process. Customer value helps your buyers realize that your product will meet their needs and more. Upon delivering on this, you will experience a higher market share, more loyal customers, and of course, more profit for further business growth.
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Now that you understand the importance of customer value, ask yourself if you are fulfilling this for your customers. It is a vital key for increasing profits and growing your business for the long term.
Need more similar business insights like these? Tune in to the best business podcast in the Philippines — Leadership Stack. Every week, we invite business professionals in different industries from all over the world to share their best entrepreneurship advice based on experience. Click here to listen now!