Did you ever notice when you stay at a nicer hotel that the toilet paper corners are usually tucked down to form a “V”? Did you ever ask yourself “Why?”

Or did you ever wonder why millions of people choose the American Express credit card when there are so many other credit cards available to them? Cards that require no annual fee – and offer better credit terms.

Why are so many Mercedes sold every year when a Ford will get you where you want to go?

In a world where price represents the majority vote on purchasing decisions the above riddles wouldn’t exist. Hotels would all be the same, as would credit cards and cars. The lowest cost provider would always win

Luckily, for all of us we do NOT live in such a world. We get to chose what we want and how much we are willing to pay. Sales and marketing professionals know that while price is important in every buying decision, it is not the only factor. They know that the real power lies in the perceived VALUE of the product or service by the buyer.

Watch This

I wish you could have been there when my good friend, Joel Davis, PhD and Professor at the School of Communications at San Diego State University, addressed a group of business professionals to drive home this point of value. He asked two “plants” in the front row to give him their watches (inexpensive ones for the demonstration). He then placed each one in a deflated balloon. He knotted one “as is” and knotted the second after blowing it up - with the watch visible inside. From under the table Joel raised his arm, brandishing a common household
hammer. With one smooth motion he smashed the watch in the flat balloon in about two seconds. He then repeated the same attack on the inflated balloon. But try as he might, the watch remained intact!

“Air” on the Side of Value

Obviously, the watch in the second balloon remained whole because the air acted as a cushion. Metaphorically speaking, the air represents value – the value each business must define for itself and the target audiences it wishes to serve. If a company has not defined this value internally, validated it externally, and reinforced it continually to its customer base it is much more likely to get hammered on pricing – especially in this economy.

Value is More Than Hot Air

If you’re thinking this example validates your suspicions that marketing and sales are just a lot of hot air, you couldn’t be further from the truth.

You see, value, by definition, is “a fair return in goods and services for money exchanged.” This implies that the “value” must provide a benefit that is important to the buyer. Value includes all those reasons that buyers buy from you and those reasons have to be relevant to the buyers’ needs. Hot air just doesn’t cut it.

In the business-to-business world “important” generally means that the product will either increase sales or decrease costs. Oftentimes it translates into things like quicker turnaround on orders, expertise, better payment terms, advertising support, relationships, the ability to access niche items for customers, shipping complete orders, uniqueness of the product, perceived or real superior performance, brand equity, and on and on.

What’s Your Value?

What value statements trip off the tongues of your
sales force when a buyer pressures them for a price
cut? Are all your employees fluent in them?

Are you folding down those corners on the everpresent roll of toilet paper to demonstrate you care about the value you are delivering? You can do this by proactively communicating those value messages to our current and potential buyers on a consistent basis. In that way you have armed them against a competitor’s lower price offer. They’ll know why they’re better off with you.

If you’re getting hammered on pricing give me a call. I’ll help you define your value and design and implement a plan to communicate that value to your customers and prospects.

Remember, Mosaic creates customers and increases sales for business-to-business companies through specific project work, on-going retainer assignments or marketing coaching sessions.

Until next time.....

Rosemary Walter
847-483-5018
Rose1Walter@MosaicMM.com

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"By Rosemary Walter of Mosaic Marketing Management, Inc. Please visit Rosemary's web site at http://www.MosaicMM.com for additional marketing articles and resources on marketing for business to business companies."