What is the role of value in my brand?Lindsay Says
Just like the word trust, the word value does not belong in your brand strategy.
Value comes from the Latin root “val” meaning “worth.” Any brand, in order to be viable, must deliver value. This is simple table stakes for doing business; it is not a differentiating factor in your brand strategy. A valued brand is simply a liked brand.
Convey Your Specific Value and Brand Promise
There’s a lot more work to do in defining a brand beyond saying it must be valued. You’ve got to be explicit and communicate to customers what value means specifically in terms of your brand promise. For example:
- If you’re Groupon: you communicate your specific value by explaining that customers can expect deep discounts on retail prices, for one product or service in a given day.
Crucially, Groupon communicates their deep discounts in the context of their emotional benefit: the charge a customer gets from “beating the system” thanks to a Groupon deal.
- If you’re Trader Joe’s: you communicate your specific value by stating that you’ll never push coupons because they hold up lines, thus wasting customers’ time.
Notably, Trader Joe’s communicates their simple pricing in the context of their emotional benefit: an inspiring and whimsical shopping experience. Shopping at Trader Joe’s is inspiring and whimsical for a number of reasons, including its simple pricing convention.
Neither of these companies has the messaging or brand promise of “save money.” They have detailed, unique explanations of how the experience is positive, with the discounted or simplified pricing as the reason to believe in that promise.
These businesses do not rely on the generic word “value.” They describe precisely what is meant by the unique type of value they offer (deep discounts or simplified pricing in these examples) – and thus convey that value is not an end unto itself. It is a means to an end, and that end is the brand promise.
Adhere to the Value Equation
Don’t forget to look at value in light of the classic equation:
value = benefit - price
While I might pay $1 for a conventional tomato, I might pay $2 for an organic tomato. As long as I believe the organic tomato is worth $1 more than the conventional tomato, then I am getting the same value for the $2 organic tomato as I am for the $1 conventional tomato.
In other words, you can increase your price if you increase your benefit, thereby increasing your perceived value.
What If You Are a “Value Brand”?
There’s a semantic confusion with the word “value” as it can also mean the opposite of premium. As in, there are premium brands (Mercedes, BMW) and there are value brands (Kia, Hyundai).
If one of the pillars of a particular business is to deliver low prices, that is great as a reason to believe in the brand, but it isn’t the brand in and of itself. You still need to do the work of creating and clearly communicating a distinct, accurate brand promise.
As a business, if you are a “value brand” you have two choices:
- Have very low prices. The problem with this choice is that only one business in every category can own this position, and that is the business with the lowest cost infrastructure. (Don’t try to out-Walmart Walmart.)
- Move upmarket. As we saw in the equation above, if you increase your benefit, you can increase your price. This can be achieved through any and all of the 4 Ps: improving your product, building the brand’s promotion, innovating pricing, and streamlining distribution.
Determine Precisely What Value Means for Your Brand
Of course you want your brand to be valued. Your success lies in figuring out how to achieve that status – how to earn it in the eyes of your customers. Being a valued brand is the goal of your brand strategy, not the content of it.