Customer Value Definition: What do we actually mean by that?
Customer value revolves around the benefits your customer experiences when using your product or service, weighed against the costs, effort, or risks involved. Therefore, customer value isn't a fixed concept, but something the customer experiences.. Since every target group is different, the customer value for the same product can vary considerably from one target group to another. Our definition:
“The added value your product or service offers, from the customer's perspective.”
Examples of customer value
Let's look at some examples of customer values your product or service can offer to business customers:
- Time savings: your product saves me a lot of time, giving me more time for other things. Consider ChatGPT for research.
- Expertise: Your service gives me access to knowledge I wouldn't otherwise have. Consider, for example, consulting firms specializing in specific regulations.
- Scalability: Your service makes it much easier for me to scale my business. Consider, for example, cloud computing services like AWS, which scale their infrastructure as your digital product grows.
- Corporate Social Responsibility: Your product helps me fulfill my social ambitions. Consider, for example, collaborations with social organizations like the Stichting Lezen en Schrijven (Reading and Writing Foundation) to address low literacy.
In our other blogs, we delve deeper into research conducted on customer values for B2C and B2B companies. Read the blog about B2B customer values and B2C customer values.
Why is customer value so important for growth?
Your customer, based on their perception of the world, weighs the added value your product offers against the costs. They also compare your solution with alternatives. Total customer value is the sum of the functional, emotional, and social benefits minus the functional, emotional, and social disadvantages your product or service offers. If that customer value is positive, and more positive than your competitors', then you're the one to choose.
Companies that understand their customers and the unique customer values they offer are more successful. They can make better choices about their offering, positioning, marketing, and sales. Customer value forms the building blocks of a successful proposition. And therefore, it's also the foundation of a scalable growth strategy.
So if you know:
- what problem you're solving,
- what need you're fulfilling,
- and what value that delivers for your customer,
…then you can build your product, marketing, and innovation much more effectively. Not based on gut feeling, but on customer insight.
Customer value as a compass for your proposition
Whether you're a startup or an established B2B company: customer value helps you make choices. It shows you where you differentiate yourself and where you can improve to stay relevant.
Want to grow, innovate, or refine your proposition? Then start with the customer you have in mind. Customer value is simple: it's what your customer perceives as valuable. That's the compass you'll use to build your market strategy.
