Understanding product value is more than getting down to brass tacks.
The perceived value of your product affects your entire brand. And you can use creative methods to increase product value with a holistic brand strategy.
When the Volkswagen Group released the Bugatti Veyron over a decade ago, it cost the company more to make each car than the price tag.
At the time, this didn’t look like good business, but the brand understood its market. The investment costs allowed VW Group to develop the production line for a new Bugatti, the Chiron.
This model will put the brand back in the black and with only 500 units available, customers are clamoring to get on the buyers' list.
While not every brand can take a similar strategy to profitability, there are other methods to increase your product value. Consider some of the strategies below.
Calculating product value sounds straightforward. You take the benefits a customer gets from using the product and subtract the cost. Whatever is left is your product’s value.
But what if you’re a luxury brand? How do you calculate the benefit to customers of luxury products?
Now the value of the item becomes relative. The customer’s perception of the product changes the value equation. Therefore, we need to look at product value in both absolute and relative terms:
A Louis Vuitton handbag serves the same needs as one from Burberry but their products are consistently more expensive. The reason Louis Vuitton can charge more is they’ve spent centuries building a brand personality that increased the relative product value.
The five strategies below can help you improve your pricing strategy by leveraging the relative value of your products.
Adding additional features to a product may be a sound strategy, but there are three categories of relative product value to consider:
When choosing new features to add, you should consider the effect they will have on customers. Every feature should enhance product appeal without adding complexity to the experience.
One of the strategies Bugatti is using to increase the value of the Chiron is customization. Traditionally, you could only get one-off models from the company but to maximize their revenues from the Chiron range, the Sur Mesure division provides customized editions.
Although customers can’t make their own changes to the car, you can add customization to your products using a configuration platform. Examples of how you can increase product value with customizations include:
You can see more great examples of brands getting customization right in this blog.
Brand collaborations don’t just give you extra publicity and let you reach new potential customers, they also increase the value perception of your products. Whether it’s getting a celebrity endorsement or designing a product for a collaborative campaign, the right partnership can be a powerful method to boost product value and drive brand awareness.
A great example of a successful collaboration is between LEGO and Netflix’s Stranger Things. The LEGO set can flip around to match the “Upside Down” of the hit TV show. As fans of LEGO and the show continue to rave about the collaboration, both brands are increasing the perception of value for Netflix and LEGO customers.
Visual experiences have come a long way since the static photographs of the past. Customers now want interactive 3D renderings of products or augmented reality experiences when making buying decisions.
3D product visualization creates an immersive shopping experience that boosts the appeal (and value) of your products. It’s also cheaper than traditional photography. When you combine product customization with 3D visualization, you can increase your average order value and charge a premium for personalized products.
Customer loyalty programs help you boost sales, but having exclusive offers for members can help increase product value. Scarcity makes a product more desirable and increases the price customers are willing to pay for an item.
Nike has a global SNKRS day every year where only members can buy exclusive designs from the brand. Since its inception, the day has only grown in popularity and the value of all Nike’s products continues to go up. While this year’s SNKRS day was exclusively in Europe, users that have the SNKRS app could still get their hands on some limited-edition apparel.
ConfigureID helps leading brands increase product value with engaging and immersive visual experiences. The product personalization platform enables you to deliver full 3D visualizations, augmented reality experiences, and feature-rich product customizations.
The intuitive user interface will guide customers through the shopping experience, and they can see the changes they make in real time. With ConfigureID’s product personalization platform, you can boost average order value by as much as 50%. Customers are willing to pay 30% more for customized products and 80% of shoppers return to the site if they configured an item.
If you want to see how using 3D visualization and product personalization can help increase your product value, request a demo from ConfigureID.
