Knowing What
Your Market Values

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Money is objective.

Money is absolute.

Value is subjective.

Value is relative.

Think of a bottle of water.
The PRICE of the water is $1.69 per bottle. Objective and Absolute.
The VALUE of the water depends on my circumstances.  Subjective and Relative.

The value, not the price, is the important factor--

What determines whether or not I make the trade is the VALUE I place on the benefit of reducing my thirst. The price of the bottle of water is just an arbitrary point at which I make the decision of relative value.

Buy...or Don't Buy

If I have been on a roof all day in the hot sun without a drink, the value of the water is high — I buy. 

If I have just finished a cold iced tea, the value of the water is low — I don’t buy.

If my thirst is completely satisfied, the water may even have a negative value (the fact that I have to carry the full bottle until I am thirsty again) — definitely will not buy.

It doesn’t depend on the price of the item. It depends on the value placed (subjectively) on the benefits provided by the product or service.

If I want the item more than the money, I’ll buy.  Buy if Item Value > Money Value

If I want the money more than the item, I won’t buy.  Don’t Buy if Item Value < Money Value

This concept has enormous importance to your construction business.  At its simplest, it suggests (no, it demands) that you have both a valuable product and a market that recognizes its value.

Having a comprehensive understanding of your market segment is critical to your branding and marketing success. This survey tests the depth of your knowledge about the Buyers in your market segment.

Since value is subjective, it can be influenced.
Adding value to a product is what marketing is all about.

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Knowing What Your Market Values


PRICE vs VALUE:

YOUR PROSPECTIVE BUYER:

The Central Model

The Central Model presents a market that:
Is sufficiently large to provide the revenue stream your company needs;
Is sufficiently small that it can be identified and addressed efficiently;
Has many of the same beliefs and values;
Has many demographic characteristics in common;
Has many psychographic characteristics in common;
Represents a group that your company and you can and do understand.

The Flanker Markets
Inevitably, you will draw interest from prospects not in the Central Model. These prospects will respond to certain of your marketing messages, but will differ in important ways from your Central Model. They will respond to your value message, but perhaps not to your design message. Or they may respond to your design message, but do not fit the demographic model. These prospects comprise your "Flanker Markets". Flanker markets do not precisely fit your Central Model. However, such markets represent sales opportunities that you cannot ignore. Additionally, the flanker markets provide important information to you regarding where your market is heading, and clues as to how to tweak your offerings to align more closely with potential clients.

MASLOW'S NEEDS HIERARCHY:

According to the "Hierarchy of Needs" theory of Abraham Maslow, the most useful way to try to understand human values is to place those values in a pyramid of needs, beginning with the most basic need of survival and ascending to a state of realizing one's full potential, or self-actualization.

As each level of needs is fulfilled, the next level can be addressed.

This concept is valuable for attempting to understand and address the aspirational values of potential home-buyer clients.
The pyramid illustrates that the first level of need is physiological, i.e. for some form of shelter.
Once that need is met, the desire is for safety and security.
When the individual feels safe and secure, she aspires to belong to a group (or tribe).
When the individual is ensconced with a group (such as a neighborhood), he aspires to be valued or esteemed within the group.
As the individual grows in terms of standing in the community, he or she can begin to realize their full potential as a member of society.

The illustration would also suggest that an individual does not progress to the next level of the hierarchy until they have substantially realized the characteristics of the level below.
In essence, as humans, we progress from survival --> comfort --> sharing --> respect --> fulfillment.
Our housing aspirations follow the same path.

IS YOUR MARKET SEGMENT WILLING TO PAY FOR VALUE?



Thanks for completing this survey in the FOUNDATION series. Be sure to request a copy of the survey for your records, as Builder Academy does not retain this information.

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