Humans are inherently logical creatures, right?
Of course, we are in some ways, but many decisions we make are ruled by emotion, even when they feel purely rational.
Take, for example, the tulip and Tulip Mania in the 17th century. Thanks to a combination of factors, there was a period when a single tulip went for over a thousand dollars. For reference, today you can buy a bouquet of tulips for $10 at your local grocery store.
Of course, supply and demand played a significant role. The term Tulip Mania, though, has come to be recognized as a reference “to any large economic bubble when asset prices deviate from intrinsic values.” (Mises Institution) The term value is key here. And considering what tulips bring to the table, it obviously wasn’t actual value that drove people to spend a fortune on tulips. It was the perception of value.
While functional and monetary value does matter to an extent, it’s often the perception of value that hooks people and it’s definitely the perception of value that turns customers into brand advocates. When it comes to creating perceived value, data storytelling is key. Keep reading to learn the relationships between value, perceived value, and data storytelling.
Value and Perceived Value: What Are They and What Do They Matter to Marketing?
Value is what you get out of something. Or, more specifically, it is the ratio of how much it costs to produce a product to how useful it is to the buyer, represented as Value = Benefits/Costs.
Perceived value is what you feel you get out of something, or the worth that a product or service has in the mind of the consumer.
And while any brand worth its salt should definitely provide value to its customers or clients, perceived value is what differentiates the Samsungs and the iPhones of the world. It adds to the importance of value, which is the reason that value and perceived value also have a positive relationship—the more you have of one, the more you have of the other. In other words, you shouldn’t focus only on value or on perceived value—you need both. The details below express this in even more detail:
- Low V (0); Low PV (0) – Find a New Job
- Without value or perceived value, finding even one paying customer will likely be impossible. In this situation, not only are customers not actually gaining anything from your product, they don’t even feel like they’re gaining anything. Rethink your business model, or start looking for a new job.
- Low V (0); High PV (10) – Fraud
- I hate to tell you this, but if your product actually offers very little value while your audience thinks it offers tons of value, you’ve landed yourself in the fraud area. Morals aside, this type of success is typically unsustainable once your audience catches on that they’re being duped. Start thinking of ways to up your offering’s value.
- High V (10); Low PV (0) – Struggling
- Most commodities find themselves here. Let’s use the example of a marketing agency where the specialists are bending over backward to deliver on client needs. The problem is, the clients don’t see the point (or the results) of what they’re doing, and constantly question why they’re spending their money with the agency. That’s the result of low perceived value.
- High V (10); High PV (10) – Star
- When you have high value and high perceived value, you’re doing the right thing by your audience and your brand. In other words, you’re setting your brand up for long-term success. The businesses in this category build a strong level of trust with their audience by delivering on expectations and ensuring their audience members know exactly how.
As you can see, the only truly ethical and sustainable state here is the combination of high value and high perceived value.
Brand Magic – The Differentiator Between Commodity and Partner
And while you may assume that equal value and perceived value is the best possible state a brand could be in, there’s one that’s even better. Even at the best of the four scenarios above, you’re still simply breaking even. In that space, there’s still a sense of commoditization and audience loyalty is lacking. As a result, there’s a limit to how much you can charge for your product or service. How do you get to the next level? Brand magic.
In other words, high value combined with even higher perceived value. Scroll through the interactive graph below to learn how perceived value can create brand magic:
It is in this situation that brands become leaders in their spaces. This is the ‘feeling’ area, and it’s where your audience starts to see you as a partner, not a commodity.
Here’s the big question: what’s the gap between value and perceived value? And how do you make your brand’s perceived value skyrocket?
A powerful answer to this question is storytelling. Specifically, data storytelling.
Data Storytelling: Why It’s More Powerful Than Traditional Storytelling
We all know that storytelling brings the emotion and drives better audience connection. Data, on the other hand, proves value in an objective and convincing way. On their own, though, they may not be enough to inspire your audience. When you bring narrative and data together, though, you drive action.
Why? Because the data backs up the narrative, while the narrative creates emotional resonance, resulting in strong engagement. Of course, you also need the right visuals; this is where the science of analytics turns into the art of telling stories.
Data storytelling can be both used in different ways and can take different forms. For example, an infographic that displays data in a compelling way. Or the personas used by your marketing team, which put a face and a human story to numbers and research. Ultimately, though, great data storytelling comes down to these three qualities: Data, science, and art.
Start Finding Your Brand Magic
The beautiful thing about perceived value and brand magic is that you can create it yourself—and likely with a lot fewer resources than, say, launching an entirely new product line. With a powerful combination of creative narrative and impactful data, you can tell a story that separates your brand from the competition and creates brand advocates.
Stay posted for a series we will be conducting that will explore use cases of bringing storytelling, data, and art to do everything from building your brand to driving your customers to action to creating brand advocates.
Before you can start telling great stories with your data, you need to learn how to sift through big data. Read our blog Marketers, Are You Sinking or Swimming in the Ocean of Big Data? to get started.