Price is what you pay – value is what you get.
With this striking statement, Warren Buffett pinpointed a fundamental challenge for businesses: What does value truly mean, and how can it be sustainably created for customers?
Technological excellence and functional superiority are necessary but by no means sufficient conditions for a product’s success. Far too often, companies focus on internal metrics such as efficiency gains, market share, or revenue growth – while overlooking the most critical question:
What significance does our product hold from the customer’s perspective?
Value is a multifaceted, context-dependent concept. It is not merely a financial metric but a subjective experience, deeply rooted in human behavior. Companies that understand this dynamic don’t just develop better products; they create long-term relevance and a sustainable competitive advantage.
The Five Dimensions of Value
In software development, value is far more than an abstract concept – it is the central determinant of why people choose, use, and appreciate a product. Value is not solely defined by functionality, efficiency, or cost savings; rather, it encompasses a broad spectrum of dimensions that are deeply embedded in user experience, expectations, and behavior.
A successful software product should ideally integrate multiple dimensions of value – not just solving a practical problem but creating an experience that delights customers and fosters long-term engagement.
But how can value be systematically understood and enhanced in product development?
Marketing researchers Sheth, Newman, and Gross identify five fundamental dimensions of value that significantly influence whether a product is perceived as valuable:
- Functional Value – Does the product reliably and efficiently fulfill a clear, intrinsic function? This is the foundation of any software solution—whether an app automates tasks, simplifies workflows, or provides seamless access to critical information.
- Social Value – Does the product enhance professional or personal connections? Collaboration tools like Slack or LinkedIn create value beyond functionality by strengthening social interactions and reinforcing network effects.
- Emotional Value – Does the product evoke positive emotions or provide a sense of security and trust? Digital solutions such as banking apps thrive on emotional value—building trust through transparent security measures and seamless user experiences.
- Epistemic Value – Does the product stimulate curiosity and learning? Platforms like Duolingo or Coursera leverage epistemic value by making education more accessible, engaging, and interactive. Conditional Value – Is the product perceived as particularly valuable in specific situations? For example, a weather app’s relevance skyrockets during severe storms, proving its conditional value in crisis situations.
These dimensions show that value extends far beyond functional benefits. However, design strategist Nathan Shedroff introduces a deeper perspective – focusing on Premium Value, the emotional and philosophical depth that makes products meaningful.
Premium Values
Software that transcends utility and becomes meaningful does more than solve problems – it establishes emotional, intellectual, and social relevance in customers’ lives.
Nathan Shedroff identifies 15 premium value dimensions that define how profoundly a product resonates with its users:
- Fulfillment – The satisfaction of achieving personal or professional goals through the product (e.g., Notion for productivity management).
- Beauty – Aesthetic and visually appealing design that evokes positive emotions (e.g., Apple products or minimalist UI designs).
- Community – A sense of social connection through usage (e.g., Discord or Reddit).
- Creation – The ability to build or create something of one’s own (e.g., GitHub or Canva).
- Duty – The fulfillment of moral or social responsibility (e.g., CO₂-tracking apps).
- Insight – The satisfaction of gaining knowledge or learning (e.g., Wikipedia or Khan Academy).
- Freedom – The feeling of control over one’s actions (e.g., open-source software or decentralized platforms).
- Harmony – A sense of order and balance (e.g., workflow automation tools like Zapier).
- Justice – The certainty of being treated fairly and transparently (e.g., ethical AI algorithms or open-source blockchain solutions).
- Oneness – A deep sense of unity with others or a community (e.g., crowdsourcing projects).
- Redemption – Liberation from past mistakes or failures (e.g., “undo” functions or data recovery tools).
- Security – Protection from risks and threats (e.g., password managers or encryption software).
- Truth – The experience of transparency, honesty, and integrity (e.g., fact-checking tools or open-data platforms).
- Validation – Recognition of one’s value by others (e.g., gamification mechanisms such as LinkedIn badges).
- Wonder – The experience of awe and fascination (e.g., VR technology or AI-generated art).
By aligning software development with these deeper layers of value, companies don’t just create functional solutions – they craft compelling experiences that customers deeply connect with.
Value Creation as a Strategic Guideline in Software Development
To remain competitive, companies must go beyond feature sets and efficiency – they need to intentionally address multiple dimensions of value and craft software that is not just used, but truly loved.
This requires answering critical strategic questions:
- Which value dimensions matter most to our customers?
- Are we delivering features that are meaningful, not just useful?
- How can we move beyond efficiency to integrate emotional, social, and epistemic value?
The difference between a good product and an extraordinary one lies in whether it meets deep-seated human needs. Companies that see value as a holistic experience—rather than a technical metric—create products that achieve lasting market differentiation.
Thus, every product strategy should ask: Are we merely building software, or are we crafting meaningful experiences?
Products that offer Premium Value do not just survive – they thrive, attracting loyal customers willing to pay more for the perceived added value.
Embedding Values in Software Development
Why are these principles essential for software development? Because customers choose products that enhance their lives – not just those that are well-engineered.
To ensure continuous value delivery, development teams should integrate the following four pillars of value-driven software design:
Customer-Centric Discovery
- What are our customers’ true pain points?
- Are we solving problems that matter to them?
Iterative Development Test, measure, and refine continuously to ensure that real value is being delivered.
Strategic Prioritization Focus on value dimensions that drive the most meaningful impact.
Flexibility and Adaptation Recognize that customer needs evolve – software must be designed to adapt accordingly.
Shifting from Inside-Out to Outside-In Thinking
Many companies develop software with an inside-out mindset – prioritizing internal efficiency, feature expansion, and cost-effectiveness over actual customer value.
However, customers think differently. They don’t ask:
Is this product the most technologically advanced?
- Does it have the most features?
- Was it developed with maximum efficiency?
- Instead, they ask:
Does this product solve my problem?
- Does it improve my life or work in a meaningful way?
- Why should I choose this over an alternative?
- Market relevance isn’t defined by technology alone—it is defined by the meaning and impact a product creates.
Companies that master the outside-in approach, starting from the customer’s needs, don’t just create products—they create solutions that are valued, recommended, and adopted long-term.
Conclusion: Values as a Strategic Lever for Sustainable Success
Functional, emotional, and social value—along with Premium Value – are not just abstract concepts. They are the foundation of truly successful software.
Companies that internalize these principles don’t just develop tools – they craft memorable, high-impact experiences. In an oversaturated market, this makes all the difference:
Products that are not just used—but loved.
The ultimate question for software leaders: What values does your product embody today – and how can you elevate them to create truly meaningful experiences?