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Sunday, 8 December 2013

Create Value to Sell More

When you create value it means you are increasing the the worth of a service/product or business. In our day to day life we see these examples all around us.

There are a number of ways you can create value. The three mains ways being:
  1. Up-Selling - Selling more services/products than originally requested by the customer. A classic example is the selling to the fast-food customer. The customer orders a hamburger, and the server asks the “Would you like fries with that?”. There is an increase in the price of the purchase but the customer sees the value because if he bought the items separately it would have been much more expensive.
  2. Cross-Selling - Selling additional product/service to the customer that complement the original requirement of the customer. For example, usually when you buy an item of electronics the server offers a service plan with it. The cost of the purchase has now gone up but there's  value created for the the customer of "peace of mind".
  3. Value-Added The value-added philosophy is clear in saying two things. The first one being the focus on the customer problem/requirement that needs to be solved. The second the customer is fully aware the seller is selling the service/product for a profit. In a value-added environment, both parties achieve their goals. A good example of this is when an IT firm sells services/products to a customer to resolve certain challenges they may be facing that can only be overcome by the use of the right technology.
In all three value creation cases you need to remember you should be ready to explain to the customer how the service/product will benefit the customer.