economic

Let’s break it down

Artwork by Rvasilovski

Value creation extends beyond efficient manufacturing of predefined goods as one has to understand that a very large part of economic value is created in the mind and not in the factory. I think marketing is as much a source of value creation as manufacturing, unfortunately not everyone shares this perspective. There are many thinkers who believe that value is inherent and can be manufactured with increasing efficiency. I contend that true innovation lies not only in altering the products themselves or the means of production but also in reshaping people's perceptions as I believe innovation and marketing are fundamentally two sides of the same coin. And there are only two ways that you can create new economic value - you can either find out what people want and work out a clever way to make it or you can work out what you can make and find out a really clever way to make people want it. What do you think?

There's no easy route

Standard economic theory envisions individuals endowed with perfect information, complete trust, and consistent preferences while possessing a complete understanding of their utility functions. In other words, they possess clear knowledge of their desires, their willingness to invest, and a deep-seated trust in their potential sellers. Many economic models build upon these foundational assumptions, and these models operate under the notion that the sole avenues to enhance a product's appeal involve reducing its cost or expanding its functionality. I think that we have allowed economists to create a culture in which business makes the same assumptions that dictates the only means to enhance value is through efficiency improvements. However, reality teaches us otherwise, value creation can also arise through the establishment of trust, by telling a story which frames the price of the product or function of the product in a new enlightening and more motivating way or selling it in such a way that fosters confidence in the consumer's decision.

Material vs. psychological value

Is economic value material or can it be psychological?

Economic value can be both material and psychological, depending on the context and perspective. In the traditional sense, economic value is often associated with tangible and measurable factors such as physical assets, goods, services, or resources. The psychological aspects of economic value are driven by individual or collective beliefs, preferences, and emotions. I think the next burst in economic growth will be driven by improvements in marketing efficiency, specifically resulting from in academic research in psychology, human behaviour, anthropology, and behavioural economics.

More food for thought

Any relationship that doesn’t have trust isn’t going to work, and I mean neither romantic nor professional, as I think trust is the most important part of any relationship. When the economy breaks down, it usually breaks down because there’s no trust in the markets, for example, banks that think the economy is going bad don’t trust consumers and don’t loan money, and subsequently, consumers who don’t trust their economic futures will not go out and buy things. Corporations who don’t trust consumers to support them won’t make investments or hire anybody, and this breaks down an economy. It’s the same thing in relationships, if I don’t trust that you are going to love me back then why will I love you?

The Chocolate War

We live in a society where we spend so much time doing, we fail to take time to celebrate and acknowledge the things that we have done. As you may know, I have spent a great deal of my career in the lifestyle industry, and I think fashion can be a brilliant mirror of the moment.

Last night I attended the world premiere of “The Chocolate Wars” in Copenhagen. The film director, Miki Mistrati is an old friend of mine who currently lives in London and the film highlights the modern-day slave trade issues in the manufacturing of chocolate. The fact of the matter is we live in a society where profit and growth are the key performance indicators, and I have posed this question many times before: Can we have both sustainability (ethical sourcing of materials, paying a fair wage throughout the supply chain, etc.) and economic growth?

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Each buyer is unique

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Success in sales depends largely on the salesperson’s ability to adapt his or her skills and pitch when selling to different personality types. With just a little bit of communication, observation, and research, you can use your knowledge of these decision-making styles to build better and longer lasting customer relationships and increase your close rate.

 

What are those personality types? 

The four types of buyers whom I have met the most during my sales career are as follows: management, user, technical and economic buyers. I use the acronym M.U.T.E
- The management buyer is all about seeing the actual solution being implemented and how your solutions can be used.
- The user buyer is the person who is concerned with the overall customer experience and the impact of the buying experience and ease of purchase.
- The technical buyer relies heavily on measurable and quantifiable data before engaging in a purchase and wants proof that your product or service performs as stated.
- The economic buyer is focused on the ROI and stay within or under budget, this type of buyer takes into consideration examples of work done for past and current clients and seeks case studies that prove the ROI of a solution. 

 

By identifying your buyer’s personality type and what motivates them, you can tailor your sales presentation to meets their needs. I can teach you how to put all of these four types of buyers on a grid and figure why they would buy, and more importantly document the reasons why they are holding back from buying. Contact me via e-mail and I’ll guide you through the process of addressing those reasons for not buying and fine tuning your sales presentation.