The golden ticket of any industry is convincing customers to pay for your value. Apple has done the world’s greatest job and is currently capturing nearly all smartphone profits globally. Most everyone else in that industry is forced to commodity pricing with razor thin margins because customers are hesitant to pay premiums. For awhile Samsung could compete on profits but that quickly eroded.
Trying to charge for value has one big problem: defining value that people are willing to pay for. Using the Apple example again, customers are willing to pay for the quality, status, ease-of-use and integrated environment. Of those only 2 are really reproducible. How do you imitate status and define ease-of-use?
Now let’s play the game in CRE: what is value?
- Being the best at driving space utilization grates on the nerves of business operations.
- Providing cutting edge technology has costs that aren’t budgeted.
- Providing savings on transactions is your job.
- Efficiently running Facilities usually leads to less heads which has “lower service”.
- Providing dashboards is seen as a minimum requirement.
- Integrating technology and service is probably the closest but again most CRE organizations don’t have the budget for it.
- Simple is often considered valuable but how do you simplify the complicated world of CRE?
I bring this up not because it is impossible but because value is an elusive idea. No two businesses offer the same value proposition. Putting together an offering that is both unique and valuable is difficult but necessary.
What are you doing to get there?