This story is about two similar houses for sale in slightly different parts of the same town and two couples searching for their ideal next home.
By now, you are scratching your head and asking yourself two questions:
- Why do I care?
- Why should I read the rest of this post?
You should care because this short story is very important about how context drives value creation and purchase decisions.
You should continue reading because it may reset how you think about value creation and how you describe your service products, which will directly impact whether you make your revenue targets this year and next!
About the two houses
Both houses are the same size, have the same number of rooms, and were simultaneously built by the same builder. And both were well-maintained and had similar upgrades.
About the two couples
One couple is in their 70s and has an empty nest. The other couple is around 30 and has two young children.
So far, no drama!
The buying decision
Both couples saw and liked both houses. However, each offered only one house, and both couples were willing to up their offers if necessary to seal the deal. What was going on?
House location
One house was close enough to the local hospital so the homeowners could walk to doctor and lab appointments. The other house was across the street from a K -7 public school.
Need I explain more? The 70-year-olds wanted to be near the medical facility and far away from the public school with all the kids, parents dropping kids off, and buses. The younger couple wanted to be near the school their kids would attend (think no carpools or school buses) and not be annoyed at night by ambulance sirens. Both couples only saw value in the house for their unique family situation.
Since customer value is the customer’s perceived benefits as it relates to their jobs to be done, we can easily see how only one of the couples would be attracted to either of the two houses. Or context drives value creation!
The WIIFM (What’s In It For Me)
As you create new services, you must remember your target audience and ensure you have a clear, focused description of the benefits available to the prospects. If you try to offer a generic product, you will confuse the prospect because they will see a number of benefits that do not work for them and which add cost. The older couple will never purchase a home by a school, and any time or effort that went into describing the “value” they would receive for buying in that location would not register.
And this works for service contracts as well as houses. So remember:
Context drives value creation
Related article: 2 New Ways To Create Customer Value – Personalization and Co-Creation
About Middlesex Consulting
Middlesex Consulting is an experienced team of professionals with the primary goal of helping capital equipment companies create more value for their clients and stakeholders. Middlesex Consulting continues to provide superior solutions to meet the needs of its clients by focusing on our strengths in Services, Manufacturing, Customer Experience, and Engineering. If you want to learn more about how we can help your organization create more value for your customers, please get in touch with us or check out some of our free articles and white papers here.