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Do Your Products Deliver Value and Profit?

My customers are always demanding lower prices.   Sound familiar?  I hear it a lot from small business owners. But before you start looking for new ways to attract more quality customers – or worse, cut your prices, go back to the basics. Think value and profit.

As a business owner, your products and services must accomplish two things.  First, they must provide value so people want to buy them.  Second, they must produce enough sales and profit to provide you with the income you want and need to stay in business.

Create Value and Profit

When was the last time you actually thought about your products as it relates to both customer value and business profit? Been a while huh?  Here are a few things to think about.

  1. What products or services do I (or should I) offer? Which are profitable, which are low-margin?
  2. Who are the ideal customers for my profitable products or services?  Are they different than those who are buying my marginal products?
  3. How can I repackage my products or services to better meet the needs of my ideal customers today?
  4. What benefits, solutions or payoffs do my ideal customers receive from my products or services?
  5. What makes us unique and how can we capitalize on it?

The key to creating a balance between the value that customers want and profit you need starts with understanding your products and services as it relates to the benefits your target customers want – then packaging them in a way that is compelling to customers and profitable for you.

Related Article: How to Diversify Products to Maximize Sales and Profit 

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Do Your Products & Services Need a Facelift?

Products and services have a shelf life because customer needs are always changing. Those that sold well in the past may not be as effective today. Without the right products or services for your ideal customers, your marketing efforts may generate interest, but not sales.

5 Ways To Improve Offers and Increase Revenue
  • Create a new product or service for your business. What do your customers need today that you could easily offer or integrate into your services – big or small? The key to success here is to ensure it’s a natural fit for your other products or services. They should compliment your current offers and be logical to customers based on your company’s reputation, experience, etc.
  • Offer a simpler or smaller version of an existing product or service. Can you take something away or simplify it to make it more affordable to your target customers? This may be a way to create an easy entry to your company. From there, you can upsell or cross-sell products in the future.
  • Offer a bigger or more expensive version of an existing product or service. What can you add – value or technology – to make the product or service more appealing to your ideal target customers? Consider what your competition does or does not provide. One of the keys is to do a little research by talking to your ideal target customers. What do they want, what are they willing to pay?
  • Package existing products or services. While bundled services may cost more as a package, they typically deliver more value in the long-term and ultimately save customers money. The key with packaging services is to create them for a niche or small segment of your market. Do not try to create packages that serve everyone or you will ultimately serve no one.
  • Update your services. Since the needs of customers change over time, your products and services need to keep up. Do the value-added features you include still matter to customers? If not, remove them and save the money. Are there services that you need to add that are now expected? If so, find a cost-effective way to incorporate them. Feedback from customers makes this easier to do. So evaluate your services and modify them as needed.
Communicate Changes and Improvements

When you give your products and services that much-needed upgrade, remember to communicate it! While many small businesses promote a new product, they often overlook communicating improvements or changes to existing products or services. Announcements in newsletters or email campaigns, press releases, a simple business letter, direct mail piece, updates on social media or even a ‘New’ icon on your product website can often do the trick.

So as you plan your marketing, don’t overlook the product development side of your small business and remember to communicate the changes you make. Your bottom line will thank you.

More Ideas to Grow Your Business

For new business improvement articles, exclusive tools and insights on entrepreneurship, click here to subscribe to my monthly eNewsletter. When you do, I’ll also send you my free eBook, How to Build Profit Through Leverage.