Entrepreneurs are so busy, so excited about serving their customers, that they often overlook value deeply embedded in their services. Value is embedded in the processes by which they service customers, price customers, collect money from customers, communicate with customers and practically every other interaction. As a coach, it’s fun to “unearth” that value. But when on your own, you often can’t see it, or don’t even know it’s there.
I call this Veiled Value. And it’s dangerous, because veiled value is no value at all if you can’t request a price for it. One of the greatest strategies firm owners or business owners can do is unearth the value they are delivering, display it before their customers, and effectively communicate that value with an adequate price.
I was coaching with a customer the other day, and they were delivering some recurring services to their customer. They performed a service that was not originally intended to be in the contract. But the customer did not know that my customer had even provided the service to them because my customer did not tell them what they had done. In short, the value was veiled because the customer did not even know they needed it. They didn’t know there was a problem. The good part: my customer was proactively helping their customer. The bad part: they provided a service the customer didn’t know they needed anyone to provide. It’s often a pain to stop work, communicate to the customer what you are doing and try to align on what the value is by requesting a new price (typically under a change order). But the wise entrepreneur will make their value explicit. No more assumptions – communicate your value!
Work that is done in secret fails to give your customer the opportunity to attach value to that service. Giving the customer the opportunity to attach value to your work is done with proper (1) anticipation in (2) scoping your work with your customer. Let’s break that down:
1. Anticipation – if you want to unveil value, then you must anticipate the future of the service that you will be delivering to your customer. Professionals can do this. Yes, it is difficult to see the future, but we must spend a lot of time with our potential customers in order to anticipate their needs. With anticipation comes the opportunity to explicitly spell out our value.
2. Scoping – proper scoping in a written contract is our vehicle to unveil value on the services we anticipate delivering to our awesome customers. Scoping also puts up safety walls around our value. That is, a properly scoped contract puts the customer on notice that the value is explicit because it is actually written down in our contract. The assumption is that we consider everything outside of those safety walls to be veiled value. If we perform work outside of those walls, then we can not expect our customers to perceive value in what we have done. In effect, they can not attach value to what we have done because we broke the scope of our own contract (called Scope Seep). It is bad for our firms and our customers.
1. Communicated value in the present lays a future foundation of continued value delivery. The next time you renew your contract, or ask your customer to continue being a customer, they will remember what you have done in the past, and can attach larger value to what you hope to do in the future.
2. Use your processes as a way to anticipate, document, and communicate your value. Think through your processes and consider how they veil or unearth your value. Do your processes shine a big fat light on your value? Make sure your processes are constructed with this goal in mind. As an example, an onboarding process can be a way to highlight your value.
3. Before your work begins with the customer, use restrictions in your pricing as a way to highlight your value and make it obvious. Then you can price for it. For example, when meeting with a potential new customer, tell them there are restrictions to the owner of the firm. Tell them they can only have access to your team – and that access to the owner is a different price. You have just highlighted the value of the owner’s counsel. But this value is more apparent before your work begins.
4. After your work begins with the customer, consider using pain as a way to highlight your value and make it obvious. Again, you can price for it appropriately. For example, if a current customer comes to you (and you have properly set them up for value recognition with a properly scoped contract) and says, “I know I’m late, but I just found out that my tax return has to be done within a couple of days,” that pain is an opportunity for us to highlight our value and price accordingly to move that client’s work in front of all of our other client’s work. They can rightly perceive value through their pain of needing an expedited tax return.
5. The passing of time diminishes the perception of value. The longer you let your veiled value go without bringing it to the attention of your customer, the harder it will be for them to attach value to that service. Let’s say you let a customer tell you to finish their tax return within a couple of days of the due date (though they brought the information to you late) and you finish the return by April 15, 2012. You’ve thought about it, and were a little frustrated about their lack of attention, so you decide to bring it up on April 1, 2013 the next year when they bring you their tax stuff. Will the client be able to attach value to the service you provided a year ago? To be sure, it will be harder than if you had allowed their pain to highlight your value back on April 15, 2012.
Conclusion: Veiled value is essentially free value. If a customer can’t attach value to your service, then they can’t pay for it. Make your value explicit.
Jason is the Founder of Thriveal and the Chief Innovative Officer of his CPA firm, Blumer & Associates. He is the co-host of the Thrivecast and The Businessology Show and speaks and writes frequently for CPAs and creatives, his firm’s chosen niche. Jason loves to watch documentaries on just about anything. He lives in Greenville, SC with his wife and their three children.