We consider perceived value to be the central factor in product adoption. When assessing a product’s value, look at whether it provides functionality that would have a positive impact on the life of a consumer. When considering the likelihood of adoption, focus on evaluating a product’s perceived value, because, while a product might actually have a positive impact, if consumers do not perceive and understand that impact, the product is not likely to achieve significant adoption.
Conversely, a product might not actually have a positive impact. However, if customers perceive that it does, the product might achieve a respectable rate of adoption. A great example of this effect is the snake oil panaceas that were popular in the 1800s. These remedies had no demonstrable medical value, but by leveraging the placebo effect, salesmen instilled enough perceived value in customers’ minds that they sold relatively well until the formation of the FDA in 1906.
Value can come in both hedonic and utilitarian forms—that is, a product can be fun or useful or some combination of the two. We must also take perceived value into account when determining a product’s cost. If the cost of a product is out of proportion with its perceived value, customers will deem that it is not worth the cost and won’t purchase it.
Developing perceived value begins with defining and selling a product’s value proposition. If consumers do not understand a product’s value proposition, whether implicit or explicit, they are extremely unlikely to perceive it as having value. We like to test consumers’ understanding of a product’s value proposition by asking research participants to explain the impressions they’ve gained of its value proposition from a Web site landing page or product advertisement. When participants can correctly articulate a product’s value proposition without coaching, we know the messaging is effective.
When evaluating a product’s perceived value, there are two questions we must address: Is it fun? Is it useful? For both of these questions, the best data we can get is objective data. If a participant has a smile on his face and can’t put the product down, it is a positive sign your product has perceived value. When you are collecting subjective data about a product’s utility, you can ask participants how they would use the product. If participants can quickly list a few applications, the product likely has some perceived value. If participants struggle to think of an answer, there might be some difficulty with perceived value.
Confidence refers to whether consumers believe a product can successfully deliver the value that it proposes. Some products may promise value that consumers would consider extremely difficult or impossible to deliver. This can occur with products that leverage new technology, offer innovative uses for existing technology, or target consumers who don’t have a strong relationship with technology.
We’ve done user research for mobile applications during which participants told us they loved the value proposition, but didn’t think it was possible. We had to inform our clients that the level of confidence people associated with their product’s value proposition was too low and help them examine methods of inspiring consumer confidence. In our experience, low consumer confidence can be difficult to overcome. It can take time on the market and aggressive advertising and PR campaigns to affect confidence on a significant scale. But understanding where you stand in terms of consumer confidence can help you to develop a plan to address this challenge.
It’s not typically difficult to test for low confidence. Research participants usually disclose this immediately, with comments like I don’t think this would work or I don’t see how that would be possible. If you remain in doubt about consumer confidence, an effective method is to ask participants to list the reasons why a product might or might not work. If participants focus on reasons why it wouldn’t work—for example, a social Web site they believe would not catch on—you might have a problem with low confidence that could affect adoption.