Word of Mouth Marketing - A Better Model Than Net Promoter Score

The Word of Mouth Marketing Index – Embedding Tipping Point factors into NPS
Taking the Tipping Point factors into consideration, we refine NPS to include the identification of Mavens, Connectors and Salespersons. Besides including a factor to include stickiness and the context in which the respondent was at the time of answering. This comes out to be a set of four questions instead of one as required by NPS.

The four questions are
(A) Would you recommend The Company to your friends and relatives?
(B) Your Profession/Job? (An Evaluation of Maven/Connector/Salesperson)
(C) What are you doing now? (Context)
(D) Compared to other products/services how do you compare our product/services? (Stickiness)
As is evident, the first question is exactly the one which is asked in NPS. Answers to the three questions are mapped to the NPS through a mathematical model developed in-house based on the well-known method of Analytic Hierarchy Process (AHP). The details of mathematical model are beyond the scope of this article. Suffice it to say that our initial results in small in-house surveys and many online ventures created and tested in MBA student projects are very encouraging.
The WOMM Index Model for word of mouth marketing measurement can be a good and simple metric for online customer facing systems or even Small and Medium Enterprises (SME).

Read more: http://frontierindia.net/word-of-mouth-marketing-index-better-model-than-net-promoter-score

Customer Value Proposition - Crafitti's 5 Stage Model

How You Sell? - What Stage of Customer Value Proposition is your Company!

Every company wants to sell its products, services or whatever it wants to sell to the customer in the best possible way. Where is your sales messages - where is your customer value proposition - is a big question that is not easy to answer. 

In fact, companies do not have a way of saying - how we sell and how we can move ahead on the sales and marketing messages. The Following Model gives five stages of Customer Value Proposition and also what it takes to really create the Technology Epiphany.

Stage 1:     All Benefits Described with All services

Description:  The suppliers list every perceived benefit delivered by their product or service. This method requires a standardized list to be prepared for all customers in all scenarios;

Problem/Effort/Constraints: This leads to  benefits assertion without any actual benefit to the target customers, and hence an issue as customer has to think about how all these benefits asserted actually will help him meet his need.

Stage 2:   Favorable Points of Difference 

Description:  Based on the customer's awareness of alternatives, this requires the supplier to have knowledge of alternatives to his own offerings. The proposition is for the supplier to articulate the ways in which his offering is different (and better) to the alternatives.  

Problem/Effort/Constraints:This leads to what is called the value presumption – an assumption that points of difference articulated by the supplier are beneficial to the customers. 

Stage 3: Resonating Focus

Description:  The suppliers need to make their offerings superior on key elements of value that are most relevant to the customers. The supplier's offerings must demonstrate and document their superior performance. In addition, the offerings must clearly display the supplier's sophisticated understanding of their customers' business problems.

Problem/Effort/Constraints: This requires a deep effort to understand the customer need - through an effort intensive often opaque process of developing customer Insight.

Stage 4: Proposal of New Meaning

Description: Meanings result from interaction between user and product/service. This is a Proposal to your clients (who are people) about new ways in which the work/product/solution/service need to be defined/viewed/used/crafted. This requires creating altered propositions to the client and has three stages of Listening, Interpreting and Addressing 

Problem/Effort/Constraints: Lot of effort and knowledge from variety of sources - Listening is not what every company does - however companies that create Listening systems perform much better. The Inventive Thinking/Design Thinking is needed to be enmeshed inside the supplier DNA - it is long term assimilation and requires extreme effort. 

Stage 5: Technology Epiphany - The Creation of WOW!

Description: When radical innovation of technology synergizes with radical innovation in Meaning - WOW gets created. When companies create Novel technologies and combine with "new often hidden meaning of new technology" - WOW or technology Epiphany (a usually sudden realization of essential nature or meaning of something) emerges and sweeps the markets.

Problem/Effort/Constraints: Requires very deep technology development capability along with ability to create new proposals of meaning. However, it can also be crafted by companies that interpret new technology in new ways to create WOW.

SO IF YOU REALLY WANT TO  CREATE WOW pursue Technology Epiphany else be in the continuous struggle of All Benefits assertion!!!

Truth Filters and Customer Value

In Revolutionary Wealth, Tofflers talk about six truth filters that we use in our lives. These are - Authority, Consensus, Consistency, Revelation, Durability and Science. Of all the truth filters - Science - the experimental and exploratory way of establishing truth has been the cause of technological progress of the world and our understanding of the current and future world.

The authors assert that Science - as the truth filter is under major threat today from other five truth filters.

I propose that these truth filters can be used to understand how two actors (persons, companies, organizations, networks, societies) interact with each other if they have predominant different truth filters. we get a 6 x 6 matrix to understand the framework or a 5 x 5 matrix if we combine authority and revelation.

This can be a very potent framework in conjunction with other such frameworks to understand relationships.

For example, the customer value framework describe in the articles

Define and Quantify Customer Value - Reveal the Needs

and

Global Complexity Challenges Innovative Enterprises

will lead to deep insights about how to create resonate customer value with your customers.

I am working on this framework - will keep you posted about this new framework!

Who is your customer, complementer, competitor and supplier?

Repeatedly in my interactions as innovation co-crafter (thats what I do for a living anyway), with various businesses across domains - it has not been easy for people to answer a very simple question

WHO IS YOUR CUSTOMER?

Repeatedly I have found very successful and not so successful businessmen stumped with this question.


Here are my definitions - please apply to your domains and see how whether they help you to get a clear picture of your business.

1. Customer - anyone who uses your product/service to perform a function. Not necessarily who pays you. I am Google's customer, but I don’t pay Google.

2. Complementer - anyone whose product or service added to your service/product helps perform more/better functions for your customers

3. Supplier - anyone who provides you ingredients to make your product/service

4. Competitor - anyone who helps your customer to perform same function that your service/product helps the customer to perform.

In a dynamic value net (which is the most realistic scenario) - there are fuzzy boundaries between CCCS (Cust/Comple/Competi/Supplier).

Please explore your value net to find out what lays hidden in these boundaries and may be therein lies the secrets of your NEXT INNOVATION!

Customer Value Framework - Revisit

The Crafitti Thought Ignition Paper Series (Crafitti TIP) started with the Customer Value - The Unknown Fundamental
The paper became an article at Realinnovation Site as Define and Quantify Customer Value - Reveal the Needs

Recently I saw it referred at this Blog in toto

The email from Mr. Sergei Sestnov changes the story referred at the satrt into a PLAY - which is a great play on the initial story!!!!!

Sent: Thursday, December 18, 2008 3:56 AMTo: navneet.bhushan@crafitti.comSubject: roach & ants

Just read your article about customers value of products.
The story about the dying cockroach & ants is very funny and probably has a deeper meaning...

But, anyway, what if you look at the situation at another angle. In the described example ants look "stupid" - they are running all over the place searching for food, while the food is right there, but for some reason they don't get it.
But if you make an assumption - ants are "smart" - then an observer can imagine a different scenario.

"Ants Talk" (Abstract Play)

Ant Soldier: "Boss, my guys see a dying roach, but still alive within 2000 heads away from the hill. Shall we go and get him or shall we wait?"

Ant Captain: "You guys, are young, no experience. This roach can kill a dozen of you easily. Just wait, he won't go anywhere, when he passes away, then we cut him in pieces and drag home - the Queen will be very pleased with her army. But as for now, don't waste time and keep on looking for food, you know today Mama Queen laid 10 000 more eggs - soon new borns will need more food. Come on! Move!"

Roach talking to himself: "Man, that broom was fast, almost killed me. Hope I will be able to turn over and crawl away as far as possible from these little monsters, otherwise they will have a nice party eating "roachburgers".

Curtain down.
Funeral march.
Audience crying & laughing at the same time.


What I am trying to say is that often people see things through the prizm of their assumptions, or previous experience, or some "settings" in their "mind-computer". And then in every situation they will find what they expect to find.

But anyway, I enjoyed reading you article about customer's needs - clearly defining them and then finding solution as close as possible to the Ideal Final Result that's the key point of the whole Inventing Game.


With the best wishes,

Sergei Sestnov
(TRIZ fan since 1992)

*********************** I can only Thank YOU all ******************
And.... Let us pursue Innovation - exploring, experimenting and experiencing continuously!

Who is right - Customer or Provider?

Who is RIGHT?

YOUR CUSTOMER IS NEVER RIGHT.

YOU CAN NEVER BE RIGHT.

Well - Neither Your Customer Nor You can be RIGHT - alone!

However - The only way to be RIGHT is when

YOU and YOUR CUSTOMER ARE RIGHT AT THE SAME TIME.

This requires a MIND SET SHIFT - TOWARDS CO-CRAFTING!

Crafitti Thought Ignition Paper Series - Customer Value - The Unknown Fundamental

Crafitti TIPS -001-2008- Customer Value Unknown Fundamental - Upload a Document to Scribd

Read this document on Scribd: Crafitti TIPS -001-2008- Customer Value Unknown Fundamental

Value Creation in the GIX Bang World

We are living in a rapidly globalizing world. In this shifting world, rules of the game can change anytime; success will come to those who adapt quickly to the new rules. This new world has been defined by Thomas L. Freedman [“Lexus and Olive Tree”] in contrast to the earlier era as, “While the defining measurement of cold war was weight – particularly the throw weight of missiles – the defining measurement of the globalization system is speed – speed of commerce, travel, communication and INNOVATION”. How fast you innovate and adapt to the globalization is the recipe for success.
As is common understanding, the best way to adapt to the new rules is to write these rules. In these highly competitive times, with extreme uncertainties and time compressions, it is the successful exploitation of ideas, i.e., Innovation, which can be the only competitive advantage. New ideas can come from -- other industries, your competitors, your employees or your customers.
With the plethora of ideas available it is essential that the organizations need to choose the right and relevant ideas to pursue in their quest for competitive advantage. This involves choice, hence decision-making. One of the greatest challenges of human decision-making methodologies has been to help the homo-sapiens in choosing the right path out of many alternatives under the conditions of partial, incorrect and stochastic information about the future. To pursue a particular idea (especially a new technological idea) with unknown returns on investment is becoming one of the most risky decision making problem in the new world.
This brings to the third leg of puzzle, the compleXity (X) of the world. Number of alternatives, time pressure, need for analysis, information de-coherence, connections and networks are increasing at an unprecedented rate. However, human mind has a limitation as discovered of being able to process information within 5 to 9 things as discovered by George A. Miller (1956) and described in the landmark paper Magical Number Seven plus minus two (http://psychclassics.yorku.ca/Miller/). Further there is a fundamental issue of framing the right problem before solving the problems; this is leading to an increasing depreciation of confidence of human beings on their minds. The result is the rapid explosion of complexity. The connections create value but dependencies create complexity, future is approaching us faster than history is leaving us, there is an increasing distance between user requirements of what they really need versus what they claim they want, and with every choice we make today we kill many possible futures.

Globalization, Innovation and complexity (GIX) are increasing simultaneously. This rapid acceleration - I call this the GIX Bang - on the lines of Big Bang. The GIX Bang is happening due to the three inherently coupled trends of increasing globalization, increasing complexity and increasing Innovation. However, these three are so deeply knotted with each other that one can’t have a model of GIX Bang. A mathematical model of GIX bang will involve coupled non-linear equations of rates of change of Globalization (G), Complexity (X) and Innovation (I). Of course, I am not proposing to create that model here. However let us look at the parameters that are impacting these three trends
G is impacted by connections (new ways of technological connectivity across the world), Value (economic, social, military, political, technological, human) across the globe that the connections are enabling, Global real time awareness that creates Ideas to increase globalization, Have-nots of the globalizing world are creating various barriers for controlling these connections which impact globalization adversely.
X is increasing due to dependencies which are global, in multiple dimensions, and much deeper with multiple feedbacks that can create pockets of chaos and pockets of order in the world which leads to more and more of possibility of new - the emergence phenomenon that we all know of.
I is the by product - the G and X interactions demand and will lead to more Innovations - it is the only way for all of us. Innovation feed on and feeds globalization; similarly Innovation reduces complexity and may be constrained by Complexity.
The question that becomes imperative is, “How to create Wealth and Value in the GIX Bang world”?

100th Post of the year - Revisiting Customer Value

This is the 100th Post of 2008

I thought it may be appropriate to look at the responses of my question on Customer Value on LinkedIn (This is the second question asked and I have interesting responses - just reproducing public answers, There defintely were personal responses to me which I will selectively post)

The question Asked:
What are the ways in which one can understand Customer Value? I would like to know your practical experiences. This is a continuation of my first question on customer value.
About a month back I asked the following question "what is customer value?". I thank all the experts who answered the question. I have collected all the answers and posted on my blog as well at http://innovationcrafting.blogspot.com/2008/03/customer-value-responses-to-my-question.html
Would like to know how you are able to understand customer value - which typically is highly opaque? Does any tools, techniques, methods, systems help? It would be great to understand the tools that have worked?

The answers

Tarun Mishra
Independent Think Tanks Professional

What are the ways in which one can understand the Customer value? Good question. Let me answer it differently. First of all, customer value can be understtod only by living the life of your customer. Living the life of customer means by exploring their life, their challenges, their needs and their desire. You may argue that we do it always. But reality is that when you do it you try to apply logic and justify the customer's psyche. We evaluate their need. We try to rationalize customer's point of view and draw our point of view. This is not equal to living life of customer. So living customer life is take customer's like as it is and work a solution from there. As soon as you do it you will find you and your customer becomes one. customer's interset becomes your interest. Customer's pain becomes your pain. The solution thus discovered becomes a value based solution and the relatiobship with customer becomes value relationship and not just vendor-customer relationship. I hope this helps.

Sanket Dantara
Student at Indian Institute of Management, Ahmedabad

There is a term called Lifetime Customer Value, it tries to put into money terms the value the customer generates for your business through his/her life. Maybe you can read up on that and see if it helps
Clarification added 20 days ago:
"by through his life" i mean "throughout his life"

Bhanu Potta
Program Manager - Knowledge Management Program at Perot Systems

Navneet, Good question. Customer Value has been a buzz word for a decade now. Evolving from meaning “Meeting Customer Requirements” to “Customer Satisfaction” to ”Customer Delight”, the term Customer Value has now matured to exactly & directly mean CUSTOMER SUCCESS. Today’s challenge is no longer to meet requirements or satisfy or delight our customers, but to Create Success for our Customers in their business leveraging on the services we provide them. Now and going ahead, the Litmus Test for things we wonder if they are of Value to Customer is to verify their direct influence or capability to create Customer Success. Good Luck. Bhanu Potta

Sunil Raghunathan
IT Transition, Transformation & Change Management Expert

As mentioned in my previous response, understanding customer value is often impaired by the context, semantics and experiences. One of the ways (methods/tools/techniques) of understanding customer value could be through use a well-defined, and widely accepted frameworks & performance indicators. In this context, Balanced Scorecard comes to my mind right away. Not to mean that it best encapsulates the definition of value from different facets, but just that it busts some of the impairment of value definition due to context, semantics and experiences. Ofcourse, one can then slice the Balanced scorecard into hierarchies and dimensions based on business drivers. But more than the method/tool/technique/framework one can only benefit, if it is definied and praticed with correctly, objectively, and consistently across the board.

Alastair Campbell
Independent management consultant and trainer
There are a lot of good tools to help. Some that I have used and found valuable are described below, but for a good overview I suggest reading the definitive textbook Marketing Management by Kotler.
1. A framework for thinking about customer value - there are several but the one I have used most is Parasuraman / Ziman model which suggests dimensions of customer value (for a non-aspirational product / service) of Tangibles, Reliability, Responsiveness, Empathy and Assurance. - you can also obviously do primary research with your customers to come up with a framework but every time I've done this we've ended up with similar lists of attributes - the more valuable thing is how the product / service can contribute to these dimensions of value for the customers and how much they value different levels of performance, incoluding the current performance. 2. A segmentation model which will allow you to identify peer groups of customers with roughly similar needs and values. The only sensible basis for segmentation is NEED and forcing yourself through understanding whether different customer groups needs are homogeneous or not is a hugely valuable part of the process of thinking about value. 3. A value innovation toolkit. I have used an awful lot of tools to generate new value propositions or to incrementally enhance existing propositions. Mapping customers activities or following customers around or identifying 'lead' customers to understand how they use the produce can be useful to provide start points, but if you're trying to create new value you'll need some stimulus to innovation. Contact me separately ac@camc.co.uk if you want more on this. 4. A customer testing / feedback method Whether you're trying to diagnose the current importance to the customer segements of different product / service attributes and assessing current customer perception of performance, or just trying to maximise value from a new proposition, you'll need a method to engage customers. Typically this needs to be a qualitative phase followed by a quantitative phase and you will need someone with good market research experience on the team to help you design it. You can get a great added bonus out of the qualitative phase by getting stakeholders (e.g. your top mgt) sitting behind a mirror wall listening to the customer focus groups talking about what they really value, and the real problems they want fixing. That has been the single most valuable intervention I have seen in creating urgency for improvement in customer value in top management - they are much less swayed by the data than by the personal experience. Finally you need some kind of tool to compare the relative customer value of different investments in product or service attributes - to ensure you get the best 'bang for the buck'. Some use pairwise ranking research questions with customers for this, but I have also used a direct 'customer value points' tool that allows you to say for instance what is the value of improving phone response times compared to making the call a free call. A big area and my general advice would be start by keeping things simple to get an initial round of rough conclusions from some qualitative customer research before then working out where you can justify the time and money on achieving the real rigour.
Happy to exchange more ideas ac@camc.co.uk

Ellen Domb
TRIZ Consultant, Editor of the TRIZ Journal

I have been working this year with Tony Ulwick (author of the book "What Customers Want") and his colleagues at Strategy (www.strategyn.com). I am very impressed with how fast and how useful their results are--and I speak as a former QFD practioner who has been very negative on many other methods. In brief, they do a detailed analysis of the "jobs" that the customer needs to perform, and the satisfaction/dissatisfaction with the way those jobs are performed, then do extensive analysis of the results to find opportunities. The methods of asking the questions are very disciplined, which makes it possible to analyze the data very reproducibly--understanding what customers want becomes much more of a science than an art. Links:
http://www.strategyn.com/

Richard Zultner
President at ZULTNER & COMPANY

Customer Value is a core concept of Modern QFD. The subset of methods in QFD for discovering what 'value' is for the customers you are targeting is Voice of Customer analysis. This involves not just analyzing what the customer "says" but also what they "do" -- the tasks or "jobs" customers are trying to accomplish. QFD has an entire subsystem of methods and tools for this purpose. As Ellen Domb mentions, Tony Ulwick has developed a nice proprietary approach for concept innovation (based on his experience with traditional QFD in the early 1990's).


Dr Rajiv Narvekar
Research Evangelist at Infosys

Hi Navneet I would like to add another dimension to what others have replied to. The principle that firms will develop products and services and offer them to customers for consumption has been challenged. Customers are no longer passive recipients of what firms offer (however customer oriented the firm be). Customers want to play an active role in the creation and the consumption of the product. They want to be involved right from the design stage. They want to get peer feedback when they suggest designs. They want to engage with a community of other customers and improve their experience with the product / service. Firms therefore need to create a platform where communities of customers interact with the firm. This platform has to be supported by a set of nodal firms that offer complimentary services. The starting point to unlock value is to focus on the interaction elements between the firm and its community of customers. Some companies that are doing this are Progressive Insurance, Nike, Medtronics etc. Let me also assure you that this is applicable in B2B and B2C markets as well.


Tom Mathew
dam at wipro

Easiest way to understand is to reverse the role. Assume I am a land lord and I want to understand how my tenants behave. I would live as a tenant to gain experience of the customer mind. All customer are suppliers as well in most of the instances. Individual empolyees in organanizations may not have this experience as their role is compartmentalized and have not access to the paradigm of the other side In summary the easiest way to understand the customer value is to have customer experience. Organization that does compartmentalization need to realized this fact and devise mechanism to provide customer experience to the supply side staff.
--------------------------------------

Ellen Domb Suggested that I should write a paper after studying all the responses on Customer Value. I hope to do that.

Nevertheless thanks a lot to all for wonderful inputs.

Customer Value - Responses to my question on Linkedin

I asked my connections on LinkedIn the following question:

What is Customer Value? Do we really have a clear understanding of it? How do we understand what value we are creating for our customers? Is it really important to know or its just a waste of time to spend knowing customer value?

I have received many answers from many different experts - I really appreciate and thank you all. Posted below are the answers and specific names (some I personally have met some I know only through linkedIn)

Bhanu Potta
Navneet, I would point you to a book "Know Your Customer: New Approaches to Understanding Customer Value and Satisfaction" by Robert B. Woodruff, Sarah F. Gardial I am sure this book will be the best and complete answer to your question. Regards, Bhanu Kiran Potta

Steve Griffith
Understanding it is definitely a challenge but one worth taking on. Understanding customer value, by product/market/geographic segment is the first step in understanding the value proposition that must be delivered. This, in turn, is key to designing a segment by segment value stream which includes only value adding activities produced by the lowest cost internal or external provider. If the customer doesn't value the attributes added by a value stream element, get rid of them. In addition, don't be afraid to seek out the lowest cost source for each necessary element. Web 2.0 and connectivity have made it easier than ever to trade high cost internal functions for lower cost external specialists. Next, dettermine which value streams you can combine because they are similar enough and which ought to be disregarded because they serve only an unattractive segment.

Sunil Raghunathan
Right articulation, communication and understanding of customer value is often a chalenge. It requires one to get into the context, semantics, and sometimes even specific experiences of individual to interpret it. This has and will continue to be a challenge for all and in the realm of art than a science. Our understanding sometimes can get impaired by our own context, semantics and experiences. The wider the experiences an individual/organization has the brighter are the changes of one understanding the context/semantics and the value itself. Understanding or articulating customer value will be the key that would make a difference between a job well-done and also-done. So definitely not a waste of time, I suppose. Having said that I'm more interested in reading the book referred by Navneet to understand how well it reflects the crystallization of the theory that I hold in my mind based on practical experiences.

Shaun Sayers
It is only a waste of time if your intuition is as accurate as hindsight. Sure it takes time and effort to get inside the customer's head, and it can certainly be a pandora's box. However from a risk management point of view it significantly reduces the odds of costly guess-based failures Guesses are great when they work out fine, and then you ask yourself why you need to bother with the rigours of research and analysis. However the reminder comes along with every costly intuition led mistake

Rob McClenahan
Hi Navneet, The paramount value of each customer is vital to the growth and stability of any corporation. If a customer becomes disgruntled, studies indicate the average customer will express displeasure to a minimum of six individuals. Each customer becomes an invaluable linkage to future customers because the same tendency applies to share positive customer service experiences with one's associates. One of the challenges of customer value is a hybrid understanding of three critical questions that contribute to overall customer satisfaction: 1) How do I design product X to offer more and better features than the competition? 2) How do I market product X to increase marketability share in the era of globalization and international competition for market share of competing products? 3) How do I offer impeccable customer service after the sale of product X that will provide each customer with immediate resolution of service-related issues? Each of the three questions can become a work in progress and pose continual challenges to decision makers who are responsible for the product from conceptualization phases to the post sale process. In essence, these questions are strategic objectives and important to never lose focus over because globalization has increased the competitive nature in several business sectors to produce quality results with an emphasis on being responsive to the individual needs of each customer. Thank you for being a valued member of our online community and for using LinkedIn! Rob LinkedIn, Customer Support

George Anderson, MSW, BCD, CEAP

I provide Executive Coaching/Anger Management for Physicians. I use a Pre and Post test. Therefore, I am able to see the results of the services which I offer. I also receive positive feedback from those who gain from our interaction. George Anderson, MSW, BCD, CAMF

Cristina Mihai

Customer Value refers to features of your product seen as worthwile by specific groups of people/companies (this would be my pragmatic understanding of the concept). To find out what value we create for our customers we need to ask them what they value :) and then ask again if we deliver...and to do so continuously, because for some reason they tend to continuously change their opinions...:)) Seriously, not taking time to find out what is it they want from you and whether you delive may cost you the business, the profit, not to mention a lot of frustration at the hard times you have getting & keeping your client portfolio...so the time spent on this saves time & money later...

Krishnan G. S.

It is the value for money as experienced by the customer in the product/service used by him. Clear understanding - No. Creating value - by sensing the experience that the customer undergoes. It can be a waste of time if ladder is parked on the wrong wall.

Rishi Wadhawan

It is 10 times more expensive to sign a new customer than it is to retain an existing one. I guess that should be enough reason to offer more to customers in terms of utility, quality and cost effectiveness (all of which constitute value). Any product or service though objectified based on parameters defined by the market, has to be subjective in terms of the though process that goes into developing or delivering it. So it is value and only value (value for money) that will motivate the customer to give his/her/their business to us. I guess this answers the part about what and why.... To determine how we can measure value is again to see the gap between expected and achieved (be it sales, new leads, repeat business or all combined). The results should serve as a clear indication of where the lapses are. Customer Satisfaction Surveys also give a clear picture and pin point the areas of improvement. So unless the individual has exclusive marketing rights (like a patent - which in itself does not guarantee that the product will sell)...i guess a lot of time and effort should be devoted to knowing what the expectations of the customer are and managing them effectively. There is one adage that i try to go by... "Commit Less, Deliver more"

Sam Lund
Excellent question! Customer value ultimately positions your product in the market place. But, while your product features address various aspects of customer need profile, it is never the same for any two customers. Drivers for these needs have different priorities and values for the customer - thus the final value of the product varies in terms of purchase decisions. Putting aside a little bit of time to analyze this reveals wealth of useful information for marketing your product, and discovering not only the correct market segments, but also helps in setting up positive product arguments for them. But then again, you should know what you're doing, and be able to characterize your product in terms of which needs - requirements - does it solve. Connecting these needs/requirements with your actual design&development actions ultimately reveals meaningfulness of your product. A true waste of time might be to develop this product if it does not address anything making sense on the market place...

Manasa Kakulavarapu

Hi Navneet, You have raised a very valid point. My take on this is that customer value is very unique to a particular customer at a given point in time. For instance, if I were a customer, the value that I perceive of a given service will be determined by the extent to which it satisfies my immediate priorities whether it be cost, quality, or something more. However, just because it is dynamic or complex one cannot ignore the same as that is what will make your customer come back to you everytime. It makes more sense to try and unravel the mystery around customer value for long-term customers who give you huge business. Probably, the answer to the question - 'why they continue to give you huge and continued business?' lies in hidden value experienced by the customer! It will be very interesting to hear the view points of the more experienced folks in the marketing/sales roles.

Sandeep Sanwal
Navneet, Very valid question, which need to be revisited again and again. What is Customer Value? Customer wants to retain the business relationships so that his value goes up. Do we really have a clear understanding of it? We should have a clear understanding of customer business to do that we to deep drive in his business. How do we understand what value we are creating for our customers? Substantial and perceived value will be visible and that will take the relationship to next level in shape of new business. Is it really important to know or it’s just a waste of time to spend knowing customer value?>>> It is very important to know the custom which are being followed to create any Value.

Mark Noske
Customer value is everything and it is the core of all businesses. If companies dont have that understanding then they will struggle year after year. Knowing what a company wants and selling it products or services that can be delivered as promised is vital to biz success. Then continue to add value with value adds that are truly benefitial without the customer requesting u do certain things. Pro active versus re active brgds mark

Terri L Maurer
It seems that value is an individual perception and not one that can be easily defined. Just as 'beauty is in the eye of the beholder', you could say that 'value is in the heart and mind of each individual customer'. Take Wal-Mart, for instance. Some people shop there because they value the low pricing. Others like the vast selection. Still others value the late retail hours, or being able to do all their shopping, including food, in a one-stop location. Trying to pin 'value' down to one or two concepts would be very difficult.

Prakasan Kappoth
I think we should start answering this first, "Who are my customers", before identifying the value. In today's world, the definition of customer is contextual considering from the “time & space” perspective. My customer I worked yesterday could have become a vendor today, and I have no idea about tomorrow!. So, the definition of customer value should perhaps need a time associated with it. Going beyond the word "Customer", I would like to call the "stake holders" based on the line of thinking mentioned above. The “situational value” we are creating for our stake holders are measurable in the form of impact.

Deenanath Bantwal
Customer value - we talk about upping services all the time. That is not what I think. For me it is something that is translating to quantitative measures. If you say you have a value proposition of bringing state-of-the-art technologies to deliver to the customer, unless you relate to the following, it becomes baseless a) The customer Hot buttons - immediate pain areas b) The customer issues - general issues c) The motivators - what is motivating him to implement this in his org. You must answer each of them with the customer in context and then give the customer the value proposition around these aspects. Only then you will see the Customer Value emanate from the solution being suggested. PRICE IS NOT THE ONLY CRITERIA R Deena

Anil Samuel
Easiest practical way to achieve this from my past experience is to prototype the idea in a customer centric way, it may simple sequence diagrams, animated viewlets or even a prototype implemented on a branched version of the solution. Then take it from there by planning it and cost into the release cycle.

Sridhar Chakravarthi Mulakaluri
Dear Navneet, Customer value- value perception of our product/service from clients perspective How do we understand it? - By treating each client as unique and engaging them in a dialogue and understanindg their unique needs Importance- with out undrstanding this, no sales, no pricing, no profits and no business. This is the only way to escape comoditization. Best regards, Sridhar

Customer Value

It is really about Value. The interview here talks about value articulation rather than listing all benefits of a firm.

Creating resonance with the customer pain areas requires much more deeper investment by the suppliers. Here we need to build competencies to understand the needs of the customers. All said and done, supplier is not the customer, similarly, customers perceptions of what they really need may not be what they really need. Does the supplier knows what the customer needs - many times NO, sometimes yes. In most cases it is important to have a consultative approach to all customer interactions - a partnership with your customers in helping them to fullfill their needs.

The Customer Insights is what the supplier need to focus on - not using pre-defined cookie-cutter soluations - which the supplier would prefer as a cost reducer, but solving problems that emerge from opaque needs of the customers.

What is your Customer Value Model? it is really about Customer Value.