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We all sell products and or services.  Most companies believe this is all they sell.  I’ve come to believe that if that’s all we sell it’s only a matter of time before we become commoditized and join a race to the bottom of sales and profits.

Then there are those who not only sell products and services, but also understand what’s unique about these items and sell intellectual capital as well.  It’s the intellectual capital that adds value to what we sell.  I believe intellectual capital is the difference between what we’ll pay one company versus another for the very same service.

It’s not about what you get but the results of what you get gives you.  We don’t usually care about who we buy a particular product from.  What we do care about is what is the result that the product we buy provides.

Results come from intellectual capital.  We have to think past the actual product and service and think about what the real reason our customers want to buy something.  When we understand the real reasons we can design a better product that solves a problem more efficiently or elegantly than our competition. 

Every business has a body of knowledge.  All businesses have a set of knowledge around the specifics of their industry as well as how they run their business.  Those businesses that understand the thought process behind how they provide services and start with a question are often allowed higher prices in the marketplace.

We may not think about it but total cost of ownership is something that we factor when we do business with someone.  Many people do business with Toyota or Apple because they find it easier and or less expensive than doing business with their competitors.

Great companies like Apple and Toyota understand the intellectual capital behind what they sell.  They’ve thought long and hard about what the customer is interested in and then concentrate on delivering what that customer wants even if the customer doesn’t know what they want.  This understanding happens much more easily when a company understands the reasons customers do business with their companies. 

This is where intellectual capital comes in.  When you understand what’s important to those who do business with your company you can design products they’re more excited about and as a result deliver services more efficiently and charge higher prices.

Josh Patrick

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Topics: for business owners, enterprise value, strategic marketing

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