Five Truths About Your Product's Value
The full and summarized list
Value Comes from Use, NOT Purchase: Customers who never use a product they buy get zero value from it. Avoid a procurement mindset which is all about price and hardly if ever about the outcomes of the purchase.
Value is Perception: The value of a product is whatever the customer thinks it is. What the customer thinks is a combination of logical and emotional influences that come into play as they make a purchase decision.
Value is Different for every Customer: The value of your product varies from customer to customer because they use your product differently. This is why usage-based and outcome-based pricing is becoming more popular, particularly with AI products.
Value is Relative (vs an alternative). A product’s value is relative to whatever alternative the customer has. Even when there is no direct competitor, there is always, always an alternative, such as “the status quo” and “doing without.”
Value can be Quantified (even intangibles). Almost any value can be quantified. The only real challenge is measurement. So-called intangible benefits like risk and productivity take more effort to quantify, but they tend to be your product’s biggest value drivers.