Market Perception of Value Defined

Your new product has three levels of market value, “ intrinsic value, realisable value and guaranteed value!”

Your new product has three levels of market value – intrinsic value, realisable value and guaranteed value! We need to convert the one into the other – from intrinsic you derive realisable, and from realisable you derive guaranteed. If you start with 100 units of intrinsic value, then you could convert it into 60 units of realisable value, and let’s assume 40 units of guaranteed value. The important point is: The market is only interested in guaranteed value – the sweet spot! Less than 10% of all Start Ups yield any guaranteed value (hit the sweet spot). 

# Product/Market “Intrinsic value” 

 The intrinsic or inherent value of your product is measured, as the full potential valuethat your product can enable for the target market. Intrinsic value is directly proportional to the significance of the limitation that your product is diminishing for your target market. The easiest way to explain the concept of a limitation is to ask innovators: “what was impossible in the life of your target market, that you are now making possible for them? The more significant the limitation you are diminishing the higher the potential intrinsic value.

  •  Test for Intrinsic value: What is impossible in the life of your target market that your product is making possible?  


# Product/Market “Realisable value”

The realisable value of your product is measured, as the portion of intrinsic value that the target market can easily realise (on their own). It is not the ease of use, but the ease of realising the value that is important. The realisable value is proportional to the readiness of the market’s mindset, to appreciate the new value (like fertile ground for a seed).

Introducing a new product that diminishes a limitation for the market, causes a departure from the norm. It is this departure from the norm that requires a mindset adjustment, to ensure fertile ground for a high conversion of realisable value.

Most of the time people don’t prepare the mindset of the target market, and end up with a very low conversion to realised value.

  • Test for Realised Value: What is the most important aspect that the target market must understand and adopt before they will truly be able to appreciate the value they can realise from your product?


 # Product/Market “Guaranteed value”

 There is nothing as convincing, as putting your money where your mouth is! You can have plenty of intrinsic value and a high conversion of realizable value but your customer must be convinced that you are “for REAL”. The more the value that you can bring the more the scepticism from the market – it is a natural behaviour!

Let’s first make sure we, ourselves are convinced, before we ask our customers’ to be convinced. Guaranteed value is propositional to the minimum value that you will be prepared to back! The less you are convinced, the less the market will be convinced. Please note: we are talking about a guarantee that counts! – One that will convince the market that you are “for REAL”!

  • Test for Guaranteed Value: What is the minimum value that you will be prepared to guarantee for your target market, or they get their money back?

Intrinsic  [converted to] Realisable [converted to] Guaranteed

Customers are buying guaranteed value (The sweet Spot)!