Creating Value for Customers

Sustainable success and healthy business can only be achieved by constantly and consistently creating value for customers. According to Michael Porter and his Value Chain framework, creating value can be seen through Primary activities and Support activities. In this article, I’ll be focusing on Primary activities or more precisely on Marketing, Sales, Product, and Support.

So, what is customer value anyway?

Customer value represents the perceived benefit or advantage that the customer receives from a product or service when compared to its price. In a nutshell, it is a customer’s answer to a question: “What do I gain from choosing this product or service, and is it worth the cost?”

Both tangible and intangible, varied from one customer to another, the creating value process can be understood through the lens of three primary categories of needs: Functional, Emotional, and Social. These categories encompass how customers perceive and derive it from products, services, or experiences.

• Functional needs are practical and utilitarian aspects of a product or service. Customers seek to accomplish specific tasks, solve problems, or achieve functional objectives. We can meet these needs by helping customers accomplish tasks more efficiently, saving time, reducing effort, or solving problems effectively. 
• Emotional needs are tied to how customers want to feel when using a product or service. These needs are often subjective and relate to emotions, sentiments, and psychological well-being. By meeting them we can evoke positive emotions, enhance overall well-being, and create memorable experiences that resonate on a personal level.
• Social needs are related to how products or services facilitate social interactions, connections, and relationships. Customers seek to fit in, connect with others, or fulfill social aspirations. Meeting social needs creates value by enhancing a customer's social status, providing a sense of belonging, and enabling connections with others, both personally and professionally.

Creating value within companies

Value creation revolves around the idea of providing customers with something of worth that meets or even exceeds their expectations. In essence, value creation is about going beyond mere transactions. It's about building relationships, fostering loyalty, ensuring long-term customer satisfaction, and securing future cash flow.

The process of value creation does not start and end with a product or service but encompasses the entire customer experience, from initial awareness to post-purchase support.

Creating value through Marketing

The role of Marketing in creating value is to connect businesses with their target customers, understand customer needs and preferences, and communicate how a product or service can fulfill those needs.

Marketing conducts market research to gather valuable data on customer preferences, behaviors, and needs, thus shedding light on what customers truly value the most.

Furthermore, marketing segments the market, creating distinct customer personas based on shared characteristics and needs, allowing for tailored offerings. 

Collaborating closely with product and brand teams, marketing shapes a compelling value proposition that effectively communicates how a product or service addresses customer needs and resolves their challenges. Through promotion across various channels, marketing not only educates customers about the benefits and value of the offerings but also fosters engagement and relationships through social media, content marketing, and customer support.

In the end, marketing actively contributes to product enhancement by collecting and leveraging customer feedback, ensuring that products and services align optimally with customer needs.

Creating value through Sales

Unlike B2C companies, where the focus is primarily on individual consumers and marketing rules, B2B sales teams work closely with key people in businesses to understand specific needs and create tailored solutions.

Salespeople conduct in-depth discussions with potential clients about their unique challenges, objectives, and pain points. This assessment allows for pinpointing opportunities where the company's products or services can create tangible value. 

Salespeople are presenting company offerings, accentuating the relevance and benefits within the client's business landscape. This involves the art of showcasing how the solutions can provide enhanced efficiency, cost reductions, or revenue growth. 

Beyond deal closure, salespeople nurture ongoing relationships with clients. This puts them in a position to gather feedback from clients, relaying their input, requests, and suggestions to internal teams, such as those engaged in product development and customer support. 

In the B2B landscape, clients often need training and guidance for the effective use of the company's products or services. Salespeople can claim this task and provide or facilitate training sessions and ensure that clients extract maximum value from their investments.

Creating value through Product

In essence, the product team plays a significant role in creating value by focusing on user needs, effective product strategy, user-friendly design, reliable development, continuous improvement, data-driven optimization, and overall user satisfaction. A well-executed product strategy ensures that the product meets user expectations, solves problems, and evolves to deliver enduring value.

The product team starts by thoroughly understanding user needs, behaviors, and pain points. They conduct their own user research, surveys, and usability testing or gather insights from other teams to inform product development.

The product team is responsible for defining the product concept, objectives, and overall strategy. A well-defined strategy ensures that the digital product aligns with market demand and provides a straightforward solution to a problem or need, which is essential for creating value.

Designers and UX experts within the product team focus on creating intuitive, visually appealing, and user-friendly interfaces. This contributes to the product's value by making it easy and enjoyable for users to achieve their goals and complete tasks.

Engineers on the product team are responsible for building the product, and ensuring that it functions reliably and efficiently. This provides value by delivering on the company’s promises, meeting user expectations, and offering a great user experience.

QA members within the product team rigorously test the products to identify and sort out any issues or bugs before release which in turn enhances user satisfaction, preventing frustration and disruptions that can erode value.

Data analysts within the product team analyze user behavior and engagement metrics to gain insights into how users interact with the digital product. Data-driven insights inform optimization efforts, helping the team make informed decisions about feature enhancements, user flows, and user engagement strategies to continually enhance the product's value.

Creating value through Customer Support

Customer Support is the frontline of customer interaction, responsible for addressing inquiries, resolving issues, helping customers maximize the value they get from the product, and ensuring customer satisfaction in the end.

Customer support teams are tasked with addressing and resolving customer issues and inquiries promptly. This can include troubleshooting technical problems, assisting with product usage, or addressing billing concerns.

Customer support provides product education and guidance to customers. They offer assistance in understanding product features, functionality, and best practices. Educated customers are likelier to use the product to its full potential, extracting maximum value and benefit.

Customer support often plays a role in user onboarding, guiding new customers through the setup and initial use of a product or service. Effective onboarding ensures that users can quickly start using the product with confidence, reducing the time it takes to realize its value.

Customer support teams are a valuable source of feedback collection. They gather customer input, suggestions, and complaints, relaying this information to product development and improvement teams.

Retaining existing customers is often more cost-effective than acquiring new ones. Customer support can play a role in retaining customers by ensuring they continue to receive value from the product or service. Additionally, support teams can identify opportunities for upselling or cross-selling.

Conclusion

When creating value for customers, four key performers take center stage: Marketing, Sales, Product, and Support teams. These interconnected roles collaborate to deliver exceptional customer experiences and ensure sustained value delivery.

Customer value, at the heart of this process, is the perceived benefit customers derive from a product or service in comparison to its cost. Whether it's meeting functional needs, kindling emotional connections, or satisfying social aspirations, customer value is a nuanced blend of tangible and intangible elements.

The process of creating value extends far beyond the product or service itself. Marketing crafts compelling narratives, Sales forges meaningful relationships, Product teams make innovative solutions, and Support teams ensure providing information on value creation. satisfaction. Together, they orchestrate a symphony of customer delight, continually creating value and enriching the customer experience. In this interplay, value is not a destination but a dynamic, ever-evolving journey—deeply embedded in the DNA of every successful organizations.