Creating Value by Reducing and Removing
JUST ABOUT EVERY ORGANIZATION professes to be customer-focused. The question is, would their customers agree?
While most have developed clear strategies related to marketing, product development and other business functions, very few have taken the time to create a well-formulated customer strategy to address the development of deep connections with customers. In today’s omni-channel environment, such a strategy is increasingly essential to an enterprise’s long-term success.
The challenge for every organization is to understand how to create value in the mind of the customer — how to make your offering ‘worth it’, not just in terms of price, but also with respect to time, effort and other intangibles. Furthermore, customers seek value in what a product enables them to achieve — often realizing value two or three steps removed from the purchase, well outside the line of sight of the seller. Firms often fail to realize that the value experience is something to which they can contribute beyond the point of sale.
Like beauty, value exists in the mind of the beholder. It is also highly contextual, depending on the day and situation. With virtually every purchase decision, customers make a judgment call as to whether what they are getting is ‘worth it’, weighing what they will receive against what they must commit to give.
Given that customers’ perception of value involves an implicit weighing of ‘give vs. get’, it what is obtained or by what must be given. However, our research shows that value creation can also involve reducing or removing elements from interactions between the customer and the firm. Furthermore, these efforts can resonate at an emotional level with customers, beyond design and process-based elements of value.
