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1. Strategy and Value Exchange: Strategy is the art of turning the tangible into the emotional
Use a value inequality instead of a value equation.
The world is a vast marketplace of Value.
We constantly exchange Value with others.
Business is about increasing the customer's equity while growing your own.
When we sell or buy, money is involved as a medium of exchange. However, its perception is different for different sides.
–> Both for seller and buyer, the Value Received (Captured) should be more than the Value Given.
Value Received ≥ Value Given.
For the seller, both the Value Received and the Value Given are most often measured by money.
The difference between them is a profit. The seller invests it in the ability to create Value in the future.
But for buyers, this difference is measured by emotions.
Value Received – Value Given = Emotions.
It holds true even for B2B.
If the Value Given is greater than the Value Received, Emotions are negative.
If a customer believes that the deal was advantageous, their ‘equity’ grows.
Contemplation questions:
[1] How does the customer evaluate the difference between the Value Received and the value Given? Can you measure it?
[2] How can you increase the difference for customers?
[3] Can it in turn increase the difference for you?
[4] Where is the sweet spot where the difference is positive for both you and customers?
2. Customer cognitive biases: A Bird in the Hand Is Worth Two Tomorrow
Our brain is a biased discounting machine.
Would you prefer to get $100 or $120?
The question seems weird.
But it sounds less weird if phrased, "Would you prefer to get $100 today or $120 in a week?”
You can't even imagine how many people would choose to get $100 right away.
This cognitive bias is called Hyperbolic Discounting or Present Bias.
An immediate reward feels better than a postponed one.
An immediate loss feels worse than one that happens later.
Centuries ago, a cavewoman or a caveman wouldn’t think twice about getting a pig today or two pigs in a month. They lived in the moment.
We have the same brains.
Here are some examples of how businesses use the bias:
[1] “Buy it now and get 10 bonuses.”
[2] “Four installments. Six weeks. Zero interest.”
[3] Limited time offers.
Contemplation questions
[1] Do you use the Hyperbolic Discounting bias for your strategy?
[2] Does it help you sell more?
[3] Doesn’t it ruin the long-term reputation of your business?
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Check out my new book, Red and Yellow Strategies: Flip Your Strategic Thinking and Overcome Short-termism, here.
3. Trend of the week: “Find a Compatible Mom and Build Your Village”
Being a single mom is difficult.
CoAbode founders know it and offer a solution.
CoAbode is a single mothers house sharing matching service that aims to help moms find housemates.
CoAbode website declares:
“You can go it alone, but CoAbode was founded to make life easier. Two moms raising their children together can achieve more. More money, more time, more emotional support, and less mental load.”
CoAbode founders also state that “CoAbode members reduce household expenses by an average of 40%, gain an average of 56 additional hours per month,” and that “CoAbode homesharing reduces social isolation & loneliness.”
Contemplation questions:
[1] Does your strategy take social trends into account?
[2] Do you monitor social trends regularly?
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Read also: Your Employees Love Their Job? That’s Not Enough
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Nice wrap up. Interested to watch your site grow.