We often hear people going on about how they know their worth. When you look up what “worth” means, Google jacking from Oxford says that worth is basically the value of something. What people are often saying then is they know the value they bring.
Most of the time they are lying to themselves, and do not actually know the value they bring. What they are often trying to say is they know how hard they have worked, or they know the level of effort they have put in. Hard work and effort do not inherently bring value, they are simply requirements that go into valuable things.
It’s actually pretty hard to find a clear consensus on value. There are many kinds of value and it’s one of those words that really goes in a lot of directions with a lot of definitions when you get into the nitty gritty of it all.
What is value anyway?
Let’s start off looking at the definitions that Google has stolen from Oxford. We’ll focus on the “noun” version of the definition, but the “verb” versions match the first two main definitions.
the regard that something is held to deserve; the importance, worth, or usefulness of something. (this is the one we care about).
a person's principles or standards of behaviour; one's judgement of what is important in life. (While valid, this one is more a question of character than money).
the numerical amount denoted by an algebraic term; a magnitude, quantity, or number. (from here the definitions get less relevant, all subsequent definitions are measurement based like in maths or music).
So the first definition is the one the people I reference go on about. They describe understanding their value with regards to:
How important their presence is
How much material wealth their presence generates
How useful they are
A lot of the time we use money and price to measure value. Sometimes value is used to convey an appreciation of an immaterial thing where you would compare it to something of material value. As an example, a thoughtful gift brings more value than an expensive one when delivered correctly. The person receiving the thoughtful gift may appreciate it more, equating their emotional response to a dollar value experience they can compare the feeling to.
In order to measure value, we need to look into what makes people assign value to something. It’s not just as simple as “this took me 3 hours so you have to pay 75$”.
Functional value - The utility of something
It’s a little hard to find two articles that use the same values of measurement to define value, but I like this one as a starting point. It helps take a conversation on something’s worth beyond what it should cost. It starts to explore why something should be priced at a certain amount.
When we discuss value we are either looking at something’s functional value or its emotional value. We’ll start with functional value. Samsung created a brand for its Galaxy series on utility. It knew that for years it outperformed the iPhone and well, pointed out technically it’s a better phone. Samsung defenders drill that into every Facebook debate. They made sure you knew their phone was more useful, or at least more feature filled, than early model iPhone equivalents.
So basically the functional value of a product or service is based on the technical specifications meeting client expectations. Samsung phones gave a lot of features and choices and customization options. At least for a while, in my opinion, Samsung dominated with the technical specs. They offered many new features first, and made it clear if you wanted the phone with the most utility, they had you covered.
It turns out functional value is actually less impactful. People care that a thing works, but people also get stressed out when there is too much choice and they feel ignorant.
When it comes to your functional value providing a service/product, well you would take costs, add a profit margin and determine your value against the market. Our next example Apple went at things a different way, they played to your emotions.
Emotional value - The impact on your feelings
Apple has always sold by creating emotional value via experience. The iPhone is cool and sexy. Having one gives you a unique text colour. There’s no real utility value there, it’s just sentimental. You’re part of a special club that all the famous people you like are probably involved in. Plus that text colour instantly creates an us vs them dynamic. If you want to Facetime, well, that text colour better come correct. No one needs FB Messenger Voice call or Google Duo.
Apple created an exclusive ecosystem, took away your ability to customize stuff and let you know that you have a higher likelihood of sex with their products. They told you they’d keep it easy and give you the best of what you need (their specs have always been neck and neck with Samsung). They also said their phone was fire, the bees knees as they once said. The branding implications of an Apple product signals to other Apple users that you are fun like them. AirPods and AppleWatches are fashion statements more akin to Gucci than a typical smartphone.
Samsung doesn’t really convey the same level of sex appeal with its cell phone lines. Samsung does make motorcycles, maybe those are sexier. Samsung also has a military division, far less sexy.
Emotional value is more about how you feel. Apple plays heavy to status. Their products cost a lot and therefore people who have them have more money. Apple plays heavy to your sentimentality and helps create cool memories and moments (like the experience of an Apple Store visit). Apple said fuck all that nerd shit, this is how the cool kids do it. They took away a lot of freedom and focused on giving people the features they cared about, packaged in a way to make them feel important. They also made them as easy to use as possible, you didn’t need to know things.
Emotions have always sold more than logic did. Also, making your client’s feel stupid doesn’t help you sell.
Emotional value is effectively a premium
Utility is fun and all, but it’s basically describing what something can do for you. I can explain how things work for you, that has a price point. If I can do it in a way that makes you feel smart and safe the entire time, I can do it at a higher price point. The more special I can make you feel, the more money you are willing to give me.
When people believe something will increase their status in life or they have a deep sentimental attachment to something, like the nostalgia waves in music and fashion, they are willing to pay more for it. A Porsche and a Nissan will effectively get you from point A to point B. A Porsche has a much higher likelihood of having people stop and stare at you, thus creating an emotional experience. Your sentimentality is affected because you feel way cooler and create memories that you cling to. Your status is affected because you have a Porsche and nobody else does, thus more value.
These things may be arbitrary but they even apply with more noble pursuits. You may virtue signal via brands in all kinds of ways. While I’ve focused on a more douchebag version of it, the people who wear TenTree are equally as vain. They want you to know they are eco friendly AF. Bonnie will easily pay 10$ more for something that says some shit like “I Speak For The Trees”.
Brands that charge a lot more for something understand how to tap into our emotions, creating something visceral. A lot of people make good music, but does making good music inherently create an emotional response? What in the music is going to provide a deeper level of emotional value to your listener.
The day your brand represents something emotional to people is the day you win. Like Samuel L. Jackson only popping at the age of 40 is part of his brand. Someone like me, at 36 can look at him and be like damn he represents hope. That makes us like him more (at least those of us that know that about him).
Look into how you can create that deeper emotional value for your people.
Live Long and Prosper Everyone
P.S. - Basics did not notice his name in the last Branding Tip blog