The power of customer journey mapping is well understood in the service design world. Ibbaka has introduced swimlanes for value and price into the customer journey. It is important to remember that the customer journey is not a given, it is designed. Value mapping is the key tool to design the customer journey experience.

Value-based pricing emerged from the need to price differentiated products and services in the B2B context. Price optimization models based on simplistic economic theories proved inadequate for complex solutions with multiple stakeholders in the decision making unit. But over the past two decades, applications have expanded, first to sales and marketing, then to product management and marketing and most recently to customer success.

Value-based pricing and the customer journey are coming together as a the new discipline of customer value management. How would you like to go about activating and embedding this capability in your organization?

Service-led growth (SLG) is a new approach to growing resilient, adaptive and sustainable companies. It is based on a growth flywheel that is kicked off with services, that lead to subscriptions, data is gathered to generate insights, that lead to new services. It is an alternative to product-led growth that is less dependent on external financing.

Customer value management (CVM) is the most important business discipline. It helps companies across the value cycle of create, communicate, deliver, document and capture value. The result is that companies can track V2C (Value to Customer) and make sure that V2C and LTV (Lifetime Value of a Customer) are aligned. This requires methods from value-based pricing.

Value-based pricing is much more than way to set prices, or even as a tool to justify prices in the sales conversation.

Usage-based pricing is one part of value-based pricing but it is not the whole story. Recent research from the Subscribed Institute finds that usage-based pricing has the biggest impact on revenue growth when combined with other pricing metrics. Why is this? We look at why usage-based pricing drives higher growth up to a point, and why an excessive reliance on usage-based pricing can slow growth.

The value ratio is a critical but frequently overlooked pricing metric. Tracing this metric is critical to your long-term health. Deciding what level to target is one of the most important Where to Play choices you make in pricing.

A lot of data is generated across the customer journey. Innovations platforms, product development applications, marketing automation, sales management (CRM), configure price quote (CPQ), project management, customer service platforms, customer success … Where is the data from all of these applications gathered and put in the context of value? This is the direction we are taking the Value Pricing Dashboard. It will be the integration point for all of the data about value to the customer (V2C).

Value based pricing requires a formal value model. If you do not have value models that quantify value drivers and connect them together you are just pretending to do value based pricing. Good value models are three dimensional they include economic, emotional and community value drivers. They become real when they are validated in conversations with customers.

Pricing and value communication is central to good price management. When and how price is introduced into the customer conversation has a big impact on price acceptance. The customer journey map provides a guide to how to plan these conversations. Layering pricing and value into the customer journey is a best practice.

In most companies value and pricing are disconnected. Even worse, value promises and value delivery are not well documented. The result is lower sales, more discounting and churn. The Ibbaka Value Pricing Dashboard connects pricing to value across the customer journey. It gathers the data you need to effectively evolve pricing.

Too many companies negotiate a price during the sales process and then forget about it. This is a recipe for failure. Pricing and value are closely connected. The pricing-value conversation continues across the customer journey. Keeping this conversation current is how to drive renewal, cross sales and upselling.