Have you ever heard of the MPMan? How about the Diamond Rio? These 2 devices, released in 1998, allowed you to listen to compressed internet audio files on a small device that could be held in your hand.
Unfortunately for the manufacturers of these products, the only MP3 player you’ve ever owned was released in the winter of 2001, by Apple – the iPod. (Ironically, the iPod classic was quietly discontinued 2 weeks ago.)
Why is that? Why did a similar device come along a full 3 years after the first MP3 device and dominate the market?
Some argued that it was easier to use, while others found the music selection far superior and many just liked the shape. Regardless, the reason nearly everyone purchased an iPod over the competition, is because at some level they felt it was a better value.
This history lesson provides a great example of a principal that is often overlooked. The marketplace will always choose the product or service that provides the most value. Your job as an entrepreneur is to determine what your marketplace really values and deliver a product or service that takes this into consideration.
Probably the greatest example of a company that understands the value principle is Starbucks®. They quickly figured out that customers value a great atmosphere, tons of unique drink selections and the best customer service in the industry. Everyone who regularly spends $5 a day on a cup of coffee illustrates that if the perceived value is high, price doesn’t matter.
The unfortunate truth is that most entrepreneurs have no idea what their customers really value.
If you’re an accountant, please tell me the last time one of your clients sent you an email thanking you for the way you handled accumulated depreciation on the 74th page of the return. They assume you do quality work. They value the innovative solutions you bring to the table and how well you communicate throughout the process.
The good news is that determining what your marketplace wants is fairly easy. All you need to do is ask. Take your best customers out to lunch and ask them why they continue to work with you. See if you can get a prospect to fill out a brief survey and make certain you find out exactly why you lost a deal.
As with most things in life, intellectually speaking this is easy. All you need to do is choose to execute.