How many times have you heard “Stop caring what other people think about you”? Although this advice can be helpful on a personal level, when it comes to your business, what others think does matter. For business owners, how others perceive your company will impact how successful your company is. The good news is that you can strategically shape your company’s perceived value by putting the right team in place early on.
Real Value vs. Perceived Value
“All value is perceived value.”
Real value is the actual cost of a product or service—that is, what the product or service would sell for on the open market without any branding, marketing, or packaging. But products and services are rarely sold without branding, marketing, and packaging.
Perceived value is trickier to define because it’s intangible. It’s about how much someone feels the product or service is worth, and that feeling is shaped by branding, marketing, and packaging.
Marketing professionals teach us this from a customer perspective, but when you’re starting or growing a business, perceived value is also important to investors and other stakeholders who support your business, as well as to potential employees. Because of the challenge of attracting investors and employees within startups, focusing on perceived value may be more important for early-stage companies than mature companies.
How would you feel if a friend gave you Apple Airpods as a gift and they took the time to wrap them in nice wrapping paper with a bow on top and include a handwritten card? Pretty special, right? Now, what if they tossed the same gift in a battered cardboard box held together with packing tape? Even though what’s inside the box hasn’t changed, the packaging would not make the best impression.
If you present a gift to a friend in a beat-up cardboard box, it probably won’t sour your relationship with that person. But in professional encounters, perception carries much more weight. The presentation — or packaging — of your company’s story and value proposition is crucial and can have a big impact on your company’s ability to attract customers, employees, and investors.
Investing in defining your business strategy, financial planning, presentation, and internal organization isn’t just busy work. It adds substantial value to your business. Instead of trying to do it all on your own, it pays to have a team in place who can complement your experiences and skill set. The perceived value created from an expertly crafted pitch deck, a detailed financial model, an organized data room, and clean legal and financial due diligence can easily be recognized as real value in the pricing negotiations of a sales deal or a capital raise.
Sommet Strategies works with small to midsize businesses to build the right financial and operations infrastructure needed for long-term success. Because we work behind the scenes, the extra yet essential services we provide are often subliminally perceived, yet they can have an immense impact on customers, investors, and other stakeholders, whether they realize it or not. In other words, the background work Sommet does is the eye-catching packaging that makes a big difference in our clients’ perceived value.
Ready to raise your company’s perceived value? Get in touch with us.