The Value Ladder: Why you should be giving stuff away for free.
This post started as advice to a client who wanted to do an event about how good their product is. Look, their product is epic. Market-leading - technically, market/game-changing. But even knowing that, convincing their customers to invest in it simply by saying ‘look how good this is’ is a rough sales and marketing strategy. This is why if you choose to do events, you should speak about more than just how good your product is. Here’s why in a nutshell:
You want to add value to your customers and their business.
Getting a customer to come to an event to tell them how good your product is not equal to the value the product can deliver.
Instead, start by offering something smaller but still valuable for free and then upsell.
Why?
Because if you can add value to your customers before you sell anything to them, when you put a relevant product in front of them they’ll be primed to buy and they won’t balk at your prices.
Why?
Because you've already delivered value for free, which means they can trust you so imagine what they think you can do for them if they paid you/paid you more.
This is the core principle of what’s known as a value ladder.
As you add more value to the customer you increase the size/price of the services you put in front of them (rather than trying to sell them the farm out of the gates).
The first step is giving away value for free. The easiest way to do that is with content which can manifest in things like events, blogs, case studies, etc (what do you think you’re reading right now?)
You've probably already demonstrated this principle works when you’ve sponsored drinks at events in the past. Free drinks are valuable to some people and that builds trust which means they're easier to sell to.
How do we figure out what adds value?
Use this checklist to frame the topic area:
What pain-points are your customers currently struggling with?
Which of those directly or indirectly relate to what you do?
What information, data, insight can we put in front of a customer that either
Let’s them join the dots between that pain point and product (= a solution)? OR
Gives them something to try/deploy that could benefit their business (free value)? OR
Makes them rethink the way they’re currently doing things? (free value)
Pick something that satisfies that criteria and you'll have something your customers value.
Then consider:
What’s the hook that’ll create a curiosity gap and want them to find out more?
What’s the story that explains how you got to this point?
What’s the elevator pitch?
What channels does this lend itself to?
Turn this into a one-pager of facts and storytelling which will serve as your source of truth. You can then appropriate that into multiple other executions.
Example: Salary Guide
Here's the perfect example of how that comes together:
Pain point: Employers don’t know how much to pay their staff to balance being competitive and budget-conscious.
Link to what you do: Recruiter X recruits staff for businesses and a core part of what they do is help define the salary for each job.
Insight: Recruiter X’s consultants can tell you how much each job title roughly gets paid in their region.
Value add: They consolidate this information into a salary guide once a year. This adds value to customers because it lets them know how to balance their budget and still get decent staff by remaining competitive with their salaries.
And they give this content away for free.
Starting with the exclusive events which customers are invited to where the team talk about the trends and what’s driving the salaries in their region.
Then they offer hard copies to select clients which you can only get if you agree to have a consultant come and speak to you face to face in a meeting.
After that, they make it available online for free if you give them your contact details (which gives them sales leads to follow up on).
Although there’s a single value add, they cut and dice this into multiple executions (long/short-form copy, video, infographics, whatever) which all drive into their sales funnel. This is known as ‘sweating the asset’.
Once they have these prospective customers they continue to add value and push them up the value ladder with bigger ticket items.
Thinking about the other points further above
What’s the hook that’ll create a curiosity gap and want them to find out more?
This is an easy one - people want to make sure they’re paying their staff enough to keep them interested. And on a personal level, they want to make sure they’re getting paid correctly too!
What’s the story that explains how you got to this point?
Although salary guides are a dime a dozen in Recruiter X’s market, we’ll pretend that they’re keen to make sure their clients get the right talent and that candidates are fairly compensated for their work.
What’s the elevator pitch?
Come along and find out whether your staff will be sticking around next year or looking for new jobs because you’re underpaying them!
What channels does this lend itself to?
In this instance the aren’t too many channels you can’t use it on. Everything from out of home, through to digital, email and everything in between.
Example: Summary
This activity adds value to the customer, it builds trust and positions, Recruiter X, as the authority in the space without saying ‘look how good we are’. And it sells itself - people want to find out about it which makes getting people to events/sales visits/downloads easy! It literally drives their entire sales cycle and revenue. They do it every year. And it always works.
Summary
Delivering all that isn’t easy. But it works.
It all starts by putting your customer first. Understanding what’s valuable to them and them, what you’re good at or can speak with authority on and then joining the dots.
If you need help getting that one idea out of your head, give me a call and I’ll take your six.