Creativity in Generating Perceived Value

Interested in Becoming a Member?

An SIM Membership like no other, provides you with an abundance of tools, resources and opportunities to help you achieve your professional and personal success at every step of the way! Be part of our learning community of more than 34,000 corporate and individual members.


For more information about membership, please click here »

Member Login

If u are a subscriber, please use ur subscriber login.
If you are a SIM Member, please use your SIM Membership login.



Forgot your password?

Member Login



Forgot your password?
login  Cancel

Sign Up

If you wish to sign up for a SIM Membership, please click here

Subscribe

If you wish to subscribe to Today's Manager, please click here

If you wish to subscribe to Singapore Management Review, please click here

Website maintenance notice: Website will not be accessible from 27 June (11 pm) to 28 June (9 am) due to scheduled maintenance. We apologise for any inconvenience caused.

Home > Articles > Creativity in Generating Perceived Value

 Creativity in Generating Perceived Value

Bertrand Leong | Today's Manager
December 1, 2018

We can practise being creative and identify value in four levels of needs: functional, emotional, life-changing, and social impact.

Do you have an excellent product, but unfortunately
have no adopters and no buyers?

Engineer and writer Mr Atul Mathur wrote that “When Sony launched its first tape recorder in 1950, its co-founder Mr Akio Morito thought the company would be flooded with orders for what was then a novel product. To his surprise, although people liked the product, nobody wanted to buy it.” 1 One day, Mr Morito strolled by an antique shop and noticed a customer paying an antique dealer for a vase. He quickly drew a connection with what he saw and the disappointing sale of tape recorders and asked why someone would pay so much money for an old object with practically no value. Armed with this new insight, Mr Morito then noticed a shortage of stenographers in the Japanese courts, approached them, and sold the Japanese Supreme Court 20 tape recorders. “Next, he sold it to schools. Finally, the tape recorder had taken off…Until Mr Morito understood the importance of ‘perceived value’, he had not thought of approaching the Japanese courts or schools.” 1

Perceived value is the worth of a product or service to a consumer which determines the price one is willing to pay for it. 2 Known also as value in marketing, perceived value is a highly recommendable approach for brand strategy integration which is subjectively based on qualitative measures such as emotional, social, and cultural factors. It is similar to the Blue Ocean Strategy in that it creates a new demand for an existing product/service by changing the way it is marketed, and marketing it differently from one’s competitors. 2

Perceived Value to Address Needs
According to Mr Mathur, “the real value of anything can only be perceived in the context of users’ needs. A glass of water in itself has no value unless seen in the context of a person who has been dehydrating for a day.” 1 In the Harvard Business Review (HBR) article The Elements of Value 3, the authors develop a value pyramid based on Maslow’s hierarchy of needs. It comprises four levels of needs: functional, emotional, life-changing, and social impact. Some elements of value of functional needs are saving time, reducing risk, simplifying, and making money; emotional needs: reducing anxiety, attractiveness, and nostalgia; life-changing needs: motivation, self-actualisation, and affiliation/ belonging; and social impact: self-transcendence.

There are a variety of ways to inject perceived value into a product/service. They can range from higher/premium pricing, showcasing a product/service’s awards and achievements, and offering extended long-term warranties, to adopting a corporate social responsibility (CSR) initiative, and providing attentive customer service—of which, I will touch on two examples: aligning with ethical causes and customer service as value.

Align with Ethical Causes
People like to know that purchasing your product would lend itself to a good cause. Adopting a CSR or having logos and phrases that associate your products with healthy, ethical, and sustainable causes such as non-animal tested, gluten-free, fair-trade, organic, vegan-friendly, recyclable, and environmentally-friendly gives your brand additional perceived value—conveying it as the ethical choice, the healthier option, or most responsible purchase. 2

A case in point is the sale of food products with the Healthier Choice symbol which grows at nine per cent annually. It grew steadily from an initial 300 in 2001 to 2,500 across 70 food categories in 2016 to include staple food items such as bread, rice, and noodles. Other indicators of Singaporeans making healthier food choices is the increased sales of whole-grain rice (from two per cent in 2008 to five per cent in 2016) and whole meal bread (with an average growth of 14 per cent between 2011 and 2016). 4

Another case was Coca-Cola’s C2 (Coke C2). Launched in 2004 in the United States in response to the low-carbohydrate fad, Coke C2 was marketed as having half the carbohydrates, sugars, and calories of a regular Coca-Cola. But consumers did not want a half-measure compromise of what they truly desired, but the complete package of a full-flavoured Coke beverage with zero calories and carbs. 5 Hence, Coke Zero (a zero-calorie version) was conceived.

Service as Value
Further to Mr Mathur’s comment of value being perceived in the context of users’ needs, value is also being of service. “Something has value as long as it is able to serve. In this sense, value is the potential to serve. When you build products based around serving your customer mission, you can’t help but create value.” 6 Aftersales service or an extended product warranty are some examples.

Cultivating Creativity in Perceiving Value
There are simple exercises to help us cultivate creativity in perceiving value. One way (as a consumer) is to consider a personally purchased item that you value and treasure. 6 What delights you about it and what sort of value do you derive from it? I have had my fair share of bad purchases and impulse buys which ended up being relegated into a forgotten corner of my storeroom. However, a stand fan which I had bought at a bargain price in 2002 was one of my proudest purchases. It lasted 13 years without a glitch and even though the fan did not exonerate me of my bad purchases, switching it on each time gave me some much needed reprieve from Singapore’s tropical heat and made me extremely pleased with myself for making such an astute purchase. The brand had won me over and I became its greatest ambassador. It is empowering for customers when they are given the extra satisfaction with their choices.

Another way of cultivating creativity is to try to find ways of injecting value into an object that is worthless to you. What can you do with it and why did you choose it? Do the same with other items that are of little value to you. Consider taking a leaf out of Malaysian artist and architectural designer, Ms Red Hong Yi’s 31 days of food 7 which entailed creating pieces of art made out of food on the same white plate every day for a month in March 2013. The aim of the project was to challenge herself in creating and presenting something every day, and to look at food in a new way. Set yourself a challenge of adding value to one item every day for 30 days. Do this often enough and you will be surprised at how you are able to look at the same thing, see it differently, and devise new and creative ways of adding value.

References

1 Mathur A, 7 March 2015. Stuck in the job market? Try morita way, LinkedIn, https://www.linkedin.com/pulse/stuck-job-market-try-morita-way-atul-mathur.

2 Mills C. The eye of the beholder: perceived value, Richtopia, https://richtopia.com/strategic-marketing/perceived-value-branding.

3 Almquist E, Senior J, and Bloch N, September 2016. The elements of value, Harvard Business Review, September 2016 Issue, https://hbr.org/2016/09/the-elements-of-value.

4 Ng WC, 28 June 2016. Healthier-choice food products getting popular, The Straits Times, https://www.straitstimes.com/singapore/health/healthier-choice-food-products-getting-popular.

5 Creax, 24 February 2017. Product launch fails: where did it go wrong?, https://www.creax.com/fr/notre-travail/product-launch-fails-where-did-it-go-wrong.

6 Rosenblatt G, 16 May 2013. The key to creating value in business, http://www.the-vital-edge.com/creating-value-in-business/.

7 Hong YR, March 2013. 31 days of food, http://redhongyi.com/portfolio/31-days-of-food-creativity/.

IMAGE: 123RF

Copyright © 2018 Singapore Institute of Management

Article Found In

Today's Manager Issue 4, 2018

View Issue
 

Browse Articles

By Topic
By Industry
By Geography