Since all value is psychological, we must find tools that create value in the mind. There are three tools in our tool chest: knowledge (from information and other forms of content), emotion (created by design and branding) and experiences, which are a way we can combine the other two tools into something that may be greater than the sum of its parts.
Create Cognitive Value by Providing Knowledge
Knowledge is the left brain part of the value equation: practical, rational and information-based. For many customers, an explanation of the details will make the sale. Tech specs, nutritional information, warranties, miles per gallon — all these bits of information can help to create value.
If you have a great product or service to offer, one of the best ways to create value for it is just to describe it. Apple posts a large number of pages featuring product overviews and additional pages with detailed specs for those more technically inclined. A restaurant may post descriptions of new menu items that align them with the chef’s philosophy. For some of your customers, these pieces of information will create enough value to make the sale.
Another example of cognitive value creation is teaching. When a dentist builds a website that provides a detailed explanation of how cavities develop or a garden center publishes guides to water conservation, they provide information that creates value for their customers. It may not be product related, but it demonstrates that a company cares for its customers, which adds another element of value to the mental process.
Create Emotional Value by Inspiring Feelings
Design, aesthetics and branding create emotion. Emotional value is the difference between buying a practical SUV or a two-passenger sports car. It makes people buy $5,000 handbags and tattoo company logos on their skin. Emotions are the most significant aspect of the decision process for most purchases, and direct everything from what kind of ice cream we buy to what kind of house we choose. Emotional value is a powerful, powerful thing.
We already have emotions about products and services. I may hate getting my hair cut or having my car serviced. You may love shopping for expensive shoes or dining at fine restaurants. But business owners that invest new emotional value into a specific brand can turn customers into fans and individual sales into repeat business. We’ll always return to brands that make us feel strong emotions.
Many successful entrepreneurs create emotional value in their customers the same way lovers create emotion in the objects of their affection — they make people feel special. Exceptional, personal customer service can add emotional value to a purchase and justify much higher prices — Nordstrom has built their brand around this idea. Programs for repeat customers can do the same thing, from a VIP airport lounge to a members-only event at an art museum.
Create Value by Providing an Experience
A sale is a moment in time, but we don’t live in a moment — our minds merge memories and expectations with knowledge and emotion. It all combines into one big mental soup that we call a brand.
Experiences create knowledge and emotion simultaneously. When you have a cup of coffee at an intimate little cafe you learn about the product — how it tastes, how it’s served — while you experience feelings associated with the context the cafe provides. When you sit at the computer, frustrated by the complex interface of an online store that promises products but makes it impossible to buy them, you learn about the company and associate it with your feelings of anger. Every experience you create for your customers creates a perception of value. The better the experience you create, the more it's worth.
In order to create value, blank page entrepreneurs must alter the mind — it’s not enough to just create a product or service. So as you’re developing your offering you must also answer the question, “What do I want people to know? How do I want them to feel? What’s the value of this experience?”