Value - The Foundation for Customer Engagement
Karen Chiang is a Managing Partner at Ibbaka. Connect with her on LinkedIn.
Value should be at the core of every interaction. Last week, we had the pleasure of conducting a master class with venture capital firm PeakSpan. This post is a quick summary of the topics we covered. Please check out the recording of our webinar here.
If you do not communicate and deliver the value that your prospects and customers are seeking, you will not be able to win the deal or retain your customers. Also, you need to identify who you sell to both from a segmentation perspective as well as by personas. Often, you will be dealing with multiple stakeholders, and depending on their role, they will have different perspectives on the value they are looking for. This becomes an important consideration as you think about how to best emphasize your value propositions as you articulate your value story. All these factors will influence your ability to capture value.
Using the Value Cycle Framework to Promote a Value Mindset
We have developed the value cycle framework as a way to help companies establish a value mindset.
There are five elements of the value cycle: value creation, value communication, value delivery, value documentation, and value capture. Each of these is described below.
Value Creation - Value should always be based on our customers’ perspective. People and businesses receive value in different ways. In business, we often point to economic benefits. It can be argued that emotion drives action. In certain cases, firms are governed by the interests of the community. See a simple overview of value drivers.
Value Communication - This is how businesses communicate and articulate value. Your value proposition is an example of this. Different stakeholders will value different things. Communication should be catered to specific buyer types and value segments.
Value Delivery - This is how the value is delivered and how your customer recognizes and receives that value.
Value Documentation - This is how value is measured and documented. Having value recorded serves as a reference to make a case for your customers' continued investment.
Value Capture - When we do the above well, we have a greater chance of capturing value. And, when we apply the value cycle to our customer journeys we have an approach to ensure the health and integrity of the relationship to secure lifetime customer value.
The Value Cycle establishes a strong practice around customer value management and is the core of having a thriving business.
KPIs: Scoring your Value Cycle
Recently, Ibbaka has worked with a number of customers who were looking to introduce value based methodologies and to find a way to track how they could improve over time. A quick way to do this is to create a scorecard of how well you feel you are doing on each of the value cycle elements. A simple traffic light grading can be used as illustrated below:
More mature organizations can get more granular to apply this to their customer journey. We plan to discuss this in part 2 of our master class and hope you will be able to join us then.
Key Takeaways
Here are some of the topics we touched on:
Value is CRUCIAL for effective packaging and pricing
Customer acceptance leads to pricing power
Create a clear narrative that supports your value claims
Ensure YOUR value propositions resonate with YOUR customers
Position value propositions for the right segments to enhance the impact
User count may not reflect the true value customers receive over time
Use the Value Cycle Framework to identify and fix communication and value delivery issues
Maintain consistent messaging and value across all interactions to build trust
Classify value into economic, emotional, and community drivers
Leverage AI to enhance value communication and gain insights
Our upcoming webinar with Zuora & Cegid on Monetizing GenAI
