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Wednesday, April 18, 2007

Value and money

Several years ago, my wife and I set up a business to provide health information. It was the early days of the Internet; online searching wasn't common, yet sources were becoming available to open the doors of medical databases and research papers to the eyes of the patient. Our idea -- taken from another practitioner already doing a similar sort of thing -- was to assemble relevant research papers and send the package to the person with the real medical need.

The idea worked, sort of. We attracted some media publicity, and a few clients, and delivered truly solid and useful information packages (hundreds of pages of well researched documentation) to our clients who were happy with the service they received. But we ultimately shelved the idea. Ultimately changing technologies and easier Internet access to the same type of information made the idea moot, but we dropped it before that stage -- the reason -- we couldn't see ourselves earning enough money for the time and effort to do the research; and the 'sales cost' with clients wanting information for free, or very small payments, was just too high.

We were charging $250 for the service.

Today, our smallest print ad in a regional publication, on a one-time schedule, sells for $265.00. We sell lots of them. The advertiser receives some space in our newspaper, and a decently designed ad. I doubt the ad will save the advertiser's life or help deal with a truly chronic business illness, however. Morally, and in terms of its real value to the end user, I fear the business I run today has much less value than the health information service we operated some years ago. But I'm a rational person -- I'll run the business I have, not the health information service, because clearly the marketplace of potential clients finds what we does has greater value to them.

Of course, there are several reasons our ads have value. They are often closely linked to supplier/client relationships, and we work hard to provide services that transcend conventional advertising. Today, for example, we arranged with a hotel client that provides housing for construction workers some additional services -- both formally, in generating some editorial coverage for them, and informally, in helping them track down client leads.

Nevertheless, value and money are not always as logically intertwined as we would expect. People pay a lot sometimes for very little, and refuse to pay a little for a lot. As a marketer, we must remember this as we plan our strategies -- we need to package and deliver services that people will pay for, and the true worth of these services is defined more by the marketplace than our own perceptions.

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