Unlocking Product Value: The Three‑Fold Formula Behind Function, Emotion, and Asset

Business success is not only a technical battle but also a precise understanding of consumer mindset. This piece reviews key formulas from Liang Ning’s book True Demand , presenting clear models for building product value and driving change.

1. The Three‑Fold Composition of Product Value: Function, Emotion, Asset

The book proposes a simple formula (originating from Liang Ning’s friend Cai Yu):

Product Value = Functional Value + Emotional Value + Asset Value

Functional Value refers to a product’s ability to meet basic needs, such as a smartphone’s core functions of calling, photography, and internet access.

Emotional Value answers why a consumer chooses the product, acting as the emotional bridge between brand and user—e.g., Apple sells “innovation” and “belonging” beyond the phone itself.

Asset Value goes beyond function and emotion, encompassing social status and wealth, as illustrated by luxury items like LV bags that signal economic power.

2. Building Emotional Value: Physiological Arousal, Cognitive Cue, and Mental Accounting

Emotional value consists of three elements:

Physiological Arousal : stimuli that trigger a visceral “hey, this is good” reaction, such as bright discount posters that accelerate heart rate.

Cognitive Cue : recognizable brand impressions formed through advertising, social media, or word‑of‑mouth, like Apple’s minimalist design.

Mental Accounting : the way consumers mentally allocate money, allowing them to overlook price when the purchase feels emotionally rewarding.

3. Drivers and Resistance of Change: Dissatisfaction × Vision × First Step vs. Resistance

Dissatisfaction × Vision × First Step ≥ Resistance to Change

When the inequality holds, change becomes possible. Consumers need a feeling of dissatisfaction, a compelling vision of the future, and an easy first step to overcome resistance.

4. Brand and Persona: From Internet Celebrity to Luxury Icon

The book defines two success formulas:

Internet Celebrity = Product Value + Freshness + Topic‑ness

Success relies on novelty and buzz, as seen with limited‑edition cosmetics.

Luxury Brand = Product Value + Recognizability + Emotional Trigger

Luxury emphasizes recognizability and deep emotional resonance, exemplified by LV bags.

5. Assessing Personal Value: Skill Points, Resource Disk, and Influence

Liang Ning suggests evaluating value through three dimensions, applicable to both individuals and companies:

Skill Points : core technology and innovation capabilities.

Resource Disk : assets, capital, and partnerships that enable expansion.

Influence : brand awareness and the ability to lead market trends.

The book provides a comprehensive set of commercial thinking tools, from constructing product value to dissecting consumer emotions and leveraging change dynamics to break market barriers.