There is a mysterious side to how you market a product.  It’s a side that has to do with the emotional response people have when they decide if your product is for them.

This mystery creates a lot of confusion for novice marketers because it’s intangible and often illogical.

The confusion starts with a false heuristic, which is that people make purchase decisions on two fundamental criteria:

1. They are in full possession of all the facts and make their purchase decision based on all available information.
2. They make their purchase decision based on a logical justification which will maximize the utility they get from the product.

Basing a marketing strategy on this heuristic often leads to frustration.  A business can have a product that functions perfectly.  It solves a real problem in exactly the way it was designed to.  Logically, people should want to buy it.

But it doesn’t sell.  The marketing is talking about how wonderfully this product fulfills its function, and everybody agrees that it seems to work great.

But it doesn’t sell.

What’s missing?

 

Intangible Added Value

At the end of this commercial, you get a telling statement:

It’s more than a car, it’s a Subaru.

What does that mean?  It’s not something tangible about the car.  You won’t find an explanation of what “more than a car” means in the owner’s manual.

In fact, this entire commercial implies a value which is intangible.  That a Subaru is part of your family, that it ties into the experience of successfully raising a child and a son who will still tell his Dad that he loves him as he leaves for college (anybody need a tissue?).

This emotionally laden story is what Rory Sutherland calls intangible added value, which is perceived value that actually has no direct connection the tangible reality of the product.

It’s interesting, for example, to consider that drinking beer could be associated with being in shape:

What’s this commercial really saying?

People like us drink beer like this. The senseof  tribe of is what’s really being pitched here.  Michelob is not trying to get people who don’t drink beer to start drinking it.  They’re creating an emotional connection to a lifestyle so certain people who like beer will feel like this is “my beer”.

These ads are not devoid of intrinsic value.  The Subaru commercial states facts about how long lasting the cars are.  Michelob Ultra is a low-calorie beer well suited for people who want to stay thin.

But notice how these tangible facts are slipped in as minor details.  The thrust of each commercial is a story that has nothing directly to do with the product itself.

 

Three Elements of Product Value

When you consider a marketing strategy for your product, keep in mind the three elements of value:

1.  Features.  These are the actual features of the product itself.  Your drill comes with 20 different bit sizes and a battery that lasts four hours.
2. Benefits.  These are the tangible benefits derived from the product features.  Your customer can drill many different size holes and work longer without recharging his drill.
3. Intangibles.  These are the emotional rewards that are largely a perception of owning the product.   Your customer completed the home improvement project he’d been putting off, and his wife is very happy with the results (marital bliss).

 

The Business Story

With today’s digital, multi-channel marketing tactics, we talk a lot about creating a business story.  But many business owners are confused by what that story should be.

As Subaru and Michelob show us, the story lies in intangible values.  Not what your product does directly, but the perception of how it makes your customer’s lives better.

Big brands get this, but many eCommerce start-ups totally overlook it when they develop their marketing strategy.

It’s worth noting that the degree to which you use intangible value and story telling varies depending on your product.

If in fact, if you create a product that clearly solves a known problem in a new way, then a largely utilitarian marketing message may work.  If people clearly see how the features of your product will make their lives better, then a direct benefits message might be the right approach.

On the other hand, if you’re selling a lifestyle product that doesn’t have any tangible utility, then your marketing message will need to be entirely based on a story that illustrates intangible value.

Most products fall somewhere in between.  In that case, you can’t ignore the story that develops intangible, perceived value.   Otherwise, you may end up with a quality product that works well but that nobody is motivated to buy.

 

Conclusions

It’s well recognized that beyond a small percentage of experts, people can’t actually tell the difference between expensive bottles of wine and cheaper bottles.  In experiments, it’s been found that people enjoy wine more when they are told it’s expensive and rare.  In blind taste tests, they can’t tell the difference.

Sometimes people think of marketing as a type of propaganda, its practitioners bullshit artists.

But that’s a pretty uncharitable view of our profession.  Marketers communicate value.  We work hard to understand how value is created, and how its perception influences people’s behavior.

The truth is that in our consumer-based society, very few products are strictly utilitarian.  And even those that are get stratified by minor differences that are for branding purposes and are of no real utility.  Nike.  Adidas.  Under Armour.  Is there really any difference?

Yes.  The difference is perceived value.  It’s in how people feel about themselves because they associate their lives with a brand idea.  I’m proud of my expensive Specialized mountain bike.  I didn’t have to buy it.  I could live without it.  But it’s part of how I view my lifestyle.  Perhaps it’s an excess, but the joy I derive from it is worth it.

When you plan your marketing strategy, take perceived value into account.  Consider the intangible benefits your product provides that connect emotionally to consumers.

This will guide your business story, which is the core of most social media and content marketing.  Facebook and Instagram is about people, not products.  How does your product fit into people’s lives?

If you don’t answer that question, you may end up as the poor business owner who wonders why his practical, useful, well thought out product never sold.