Article review: How To Improve Sales By Focusing On The Elements of Value

Susan
By Susan September 17, 2018 11:12

Article review: How To Improve Sales By Focusing On The Elements of Value

Today I review two essential articles from the Harvard Business Review: The Elements of Value and The B2B Elements of Value. I recorded the video in Malta where I was delivering training on how to improve sales.

These articles provide precious insights into what customers really value, so I have integrated their teachings into my sales trainings. Whether you’re a business owner or an employee, the concept of “elements of value” is a superb tool when it comes to interpreting customer feedback. This will directly help you improve sales.

 

Watch my review of the two articles below.

“What do customers really value?”. A Harvard Business Review article review.

Posted by Susan Hayes "The Positive Economist" on Saturday, September 15, 2018

 

The Elements of Value, Eric Almquist, John Senior and Nicolas Bloch, Harvard Business Review, Sept. 2016

The B2B Elements of Value, Eric Almquist, Jamie Cleghorn and Lori Sherer, Harvard Business Review, March-April 2018

 

The two articles are based on the same concept of the “elements of value”. In the case of B2C, there are 30 elements of value across four categories: functional, emotional, life-changing and social impact. In the case of B2B, the authors have broken it down into 40 elements of value.

Why would you need to learn about elements of value?

Because price and cost are not the only concern of customers, whether they’re individuals or businesses. In fact, taking a more holistic approach will help you uncover hidden value points: things that your customers truly value, and that you can make sure are part of your offering.

Indeed, we buy for so many different reasons. Elementary sales and marketing training usually boils it down to two or three elements: we buy a product because it saves us time, it saves us money or it improves our sense of self. While this is a very useful mental model, it helps to break it down further and adopt a more fine-grained approach.

The 30 elements of value are great from that point of view, because they give a finer grid through which to interpret customer insights, but it’s not so many that it becomes overwhelming.

We know we should focus on the benefits of our product, instead of just the features – but how?

When I analyse how to improve sales, I constantly go back to the ideas in these two articles. Thinking about what your customers truly value forces you to think in terms of benefits, instead of just features. When we are selling, we know we should focus on the benefits that derive from the features, rather than on the features themselves. But if we’re too close to a product, we might find it difficult to take a step back and take a more well-rounded view of what it is exactly we’re selling. That’s where the Elements of Value Pyramid comes in.

The whole thrust of the two articles is to remind us as salespeople that our customers buy from us for many different reasons that don’t always have to do with pure functionality – emotional and self-actualisation aspects of the product are what takes us beyond the first sale and into retention. The article also highlights how much each interaction with a company is part of the offering: is the company responsive? Is it pleasant to do business with them? Do they represent values we subscribe to?

The insights yielded by such a finer analysis can help smaller companies find out exactly how to differentiate themselves, even when they can’t compete on price. By thinking creatively about the different value elements of their core offering, they can also improve the value of that core offering, without spreading themselves too thin. For a small business, that can mean the difference between stagnation or failure, and satisfying growth.

In the video I give a concrete example, a case study of how you can break down the different elements of value of a business: I analyse my relationship with my favourite shop in Malta as a customer, and what makes me come back again and again. The shop in question is the delightful Soap Café, and I interviewed its owner Charlene Mercieca for our Savvy Women Podcast.

 

Watch the video on my Facebook page.

Interested in productivity, business growth, innovation? Watch more book reviews here.

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Susan
By Susan September 17, 2018 11:12