2018-05-11 15:12:40 Staying Competitive English Learn about the five values associated with most products. Read about functional, aesthetic, epistemic, social, and emotional value, and... https://d1bkf7psx818ah.cloudfront.net/wp-content/uploads/2018/04/12155144/Two-small-business-owners-discuss-five-types-of-value.jpg Measuring Worth: The Five Types of Value

Measuring Worth: The Five Types of Value

3 min read

Shoppers buy products for the value that they provide. While that idea may sound simple, it’s something all product sellers need to think about. Ideally, you should know the type of value your products provide to your consumers, and you should ensure those values align with your personal and business goals.

The Five Types of Value

Consumers find value from products in five distinct ways: functional, social, emotional, epistemic, and aesthetic. Functional value comes from products that are utilitarian. For instance, stationary bicycles give you the ability to cycle inside, while frying pans give you a place to cook bacon. Although very different, these products both have functional value.

In contrast, social value is when you derive improved social status from a product, and it’s associated with products ranging from clothing to cars. Emotional value refers to perceived benefits or the feelings that certain products create. This is often tied to items with cultural or religious meanings such as Christmas decorations, but it also includes nostalgic purchases. When a product offers epistemic value, it facilitates learning, satisfies curiosity, or provides novelty. Finally, aesthetic value refers to products that are beautiful.

Identifying Product Value

As you try to decide what value your products provide to consumers, keep in mind that your products may fall into two or more categories. To illustrate, look at a Fitbit. This product offers functional benefit by tracking your heart rate, counting calories, letting you listen to music, and handling a number of other tasks, but you can also label all those elements as epistemic as well because they satisfy your curiosity about your health stats.

At the same time, this fitness tracker also taps into social value. Consumers wear their Fitbits proudly on their wrists and update their social media accounts with details from these devices. Arguably, because the Fitbit was one of the earliest and best fitness trackers on the market, it makes consumers feel "cool," and that’s the essence of social value. The company is also shifting to more fashion-forward designs, imbuing this product with aesthetic value as well.

To narrow in your product’s value proposition, you may want to reach out to your customers. Why are they buying your products? Do they like the functionality? The look? The learning potential? The way they make them feel? Ask your buyers questions that help you get at the heart of your products value.

Choosing a New Type of Value

Once you know what values you’re selling, you can decide if you need or want to change those values. At this point, you should consider if your current value proposition is sustainable. In other words, ask yourself if people will always need that value. Similarly, if others are selling products with a similar type of value, you may want to find ways you can increase or diversify the value of your product. Beyond that, you may also want to consider if your product’s value matches your brand image.

Marketing the Value of Your Products

The way you showcase the value of your products in your marketing can affect sales. If a product isn’t selling well, you don’t necessarily need to change the product itself, just how you present its value in your marketing. Take the home computer. When it was first introduced in the late 1970s and early 1980s, a number of companies focused on the functional value of this product, but Apple and Microsoft took a different approach. They tried to sell a way of life. They focused on the consumer’s need for this product, and eventually, Apple, in particular, began selling aesthetic and social value.

Regardless of what products you sell, your shoppers have to find value in those purchases. To ensure they’re getting value and you’re getting sales, you may want to tweak the values you offer or advertise. That can help to safeguard your future success.

Information may be abridged and therefore incomplete. This document/information does not constitute, and should not be considered a substitute for, legal or financial advice. Each financial situation is different, the advice provided is intended to be general. Please contact your financial or legal advisors for information specific to your situation.

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