7 Value Addition Services to Boost Your Business Growth

Value addition services are the extra benefits or features that you offer to your customers beyond your core products or services. They can help you stand out from your competitors, increase customer loyalty, and generate more revenue. Here are some examples of value addition services and how they can benefit your business.

Key Takeaways

Value addition services are the extra benefits or features that you offer to your customers beyond your core products or services.

Value addition services can help you stand out from your competitors, increase customer loyalty, and generate more revenue.

Some examples of value addition services are free shipping and returns, loyalty programs, customer service, content marketing, personalization, bundling, or guarantees or warranties.

You can choose the right value addition services for your business by considering your target market, your unique selling proposition, your customer feedback, and your budget.

You can measure the effectiveness of your value addition services by tracking metrics such as customer satisfaction, retention, lifetime value, referrals, conversion rates, average order value, or revenue.

1. Free shipping and returns.

Offering free shipping and returns can reduce the friction of online shopping and encourage customers to buy more. According to a study by UPS, 68% of online shoppers said that free shipping is important when choosing an online retailer, and 58% said that free returns influence their purchase decisions.

2. Loyalty programs.

Loyalty programs reward customers for their repeated purchases or referrals and can increase customer retention and lifetime value. For example, Starbucks offers a loyalty program that allows customers to earn stars for every purchase, which they can redeem for free drinks or food items.

3. Customer service.

Providing excellent customer service can enhance your brand reputation, increase customer satisfaction, and reduce churn. You can offer customer service through various channels, such as phone, email, chat, or social media, and ensure that you respond quickly and effectively to customer inquiries or complaints.

4. Content marketing.

Content marketing is the creation and distribution of valuable and relevant content to attract and engage your target audience. You can use content marketing to educate your customers, showcase your expertise, and build trust and credibility. Some examples of content marketing are blogs, videos, podcasts, ebooks, webinars, or newsletters.

5. Personalization.

Personalization is the customization of your products or services to suit the preferences or needs of your customers. You can use personalization to increase customer satisfaction, loyalty, and conversion rates. For example, Netflix uses personalization to recommend movies or shows based on the user’s viewing history, ratings, or preferences.

6. Bundling.

Bundling is the practice of offering two or more products or services together at a discounted price. You can use bundling to increase your average order value, cross-sell or upsell your products or services, and create value for your customers. For example, Amazon offers bundling options for various products, such as books, electronics, or household items.

7. Guarantees or warranties.

Guarantees or warranties are the promises that you make to your customers about the quality or performance of your products or services. They can help you reduce customer risk, increase customer confidence, and differentiate yourself from your competitors. For example, Zappos offers a 365-day return policy and a lifetime guarantee on its shoes.

Tip

Value addition services are not just nice-to-have features; they are essential for creating a competitive advantage and building long-term relationships with your customers.

Value Addition Services: An Overview

Value addition services (VAS) are extra features that a business offers in addition to a standard product or service. They are often used in the telecommunications industry to provide non-core services beyond voice calls and fax transmissions, such as SMS, MMS, data access, mobile TV, gaming, etc. However, VAS can also be applied to any service industry, where they can enhance the customer experience and satisfaction by offering free or low-cost perks, such as free trials, discounts, loyalty programs, etc.

Value Addition Services: Industry Trends

According to a report by Statista, the value added by private service-producing industries to the gross domestic product (GDP) of the United States was 17.93 trillion U.S. dollars in 2022, an increase from 16.52 trillion U.S. dollars in 2021. This indicates that the service sector is a major contributor to the economic growth and development of the country.

Within the service sector, VAS are expected to grow in demand and popularity as customers seek more value and convenience from their purchases. According to a report by Grand View Research, the global mobile VAS market size was valued at 415.3 billion U.S. dollars in 2019 and is projected to expand at a compound annual growth rate (CAGR) of 15.5% from 2020 to 2027. The report attributes this growth to the increasing penetration of smartphones and mobile internet, the rising adoption of over-the-top (OTT) services, such as streaming and social media, and the emergence of new technologies, such as artificial intelligence (AI), cloud computing, and blockchain.

Value Addition Services: Challenges and Opportunities

Despite the promising outlook for the VAS industry, there are also some challenges and opportunities that need to be addressed. Some of the challenges include:

The high competition among service providers and content providers, which requires constant innovation and differentiation to attract and retain customers.

The regulatory and legal issues that may arise from the provision of VAS, such as data privacy, security, taxation, licensing, etc.

The customer expectations and preferences that may vary across different regions, cultures, and segments, which require customization and localization of VAS.

Some of the opportunities include:

The untapped potential of emerging markets, such as Asia-Pacific, Latin America, and Africa, where there is a large and growing population of mobile users who demand more VAS.

The integration of VAS with other sectors and industries, such as banking, education, health care, entertainment, etc., which can create new value propositions and revenue streams for service providers and content providers.

The development of new VAS models and platforms that can leverage the power of AI, cloud computing, blockchain, and other technologies to offer more personalized, interactive, and intelligent VAS.

Frequently Questions

What are value addition services?
Value addition services are the extra benefits or features that you offer to your customers beyond your core products or services.

Why are value addition services important?
Value addition services are important because they can help you stand out from your competitors, increase customer loyalty, and generate more revenue.

How do I choose the right value addition services for my business?
You can choose the right value addition services for your business by considering your target market, your unique selling proposition, your customer feedback, and your budget.

How do I measure the effectiveness of my value addition services?
You can measure the effectiveness of your value addition services by tracking metrics such as customer satisfaction, retention, lifetime value, referrals, conversion rates, average order value, or revenue.

How do I implement my value addition services?
You can implement your value addition services by communicating them clearly to your customers, delivering them consistently and reliably, and evaluating them regularly for improvement.

References:

http://www.prweb.com/releases/2013/11/prweb11284640.htm

https://www.shopify.com/blog/value-added-services

https://www.forbes.com/sites/forbescommunicationscouncil/2018/07/16/how-to-use-value-added-services-to-increase-customer-loyalty/?sh=6a9f0b3c4f9d

https://www.business2community.com/customer-experience/7-value-added-services-can-improve-customer-experience-01885369