By Fidel
Value is a term that’s overused but often under-appreciated.
It’s not enough to claim you’re providing goods or services at a fair market price with an extra feature versus a competitor’s product. This tactic could work in the short run, but it won’t hold up over time as competitors replicate your success.
The real question is: How do you explore what your products and services are actually worth to your customers?
Let’s look at what drives long-term customer value.
Start with the Problem You’re Solving
Begin by considering what’s important for your target market and how your goods or services benefit them.
What problem are you helping them solve?
It’s not about having extra buttons on your widget if your customers aren’t somehow gaining year-over-year advantage. Features without value are just complexity.
Four Ways to Understand Customer Value
1. Map the Value Stream
Create a Value Stream or SIPOC process map to summarize the inputs and outputs between:
- Your organization
- Your customer
- Your customer’s customers
Understanding this chain helps you see where value is created—and where it might be lost.
2. Ask Directly (Voice of Customer)
Consider a direct approach. Soliciting feedback through a short phone call or survey on a regular basis ensures you’re pulsing your customers’ needs and concerns.
Good salespeople know this well and should actively participate in gathering this intelligence. Don’t wait for complaints—proactively seek feedback.
3. Align with Your Strategy
Keep your company’s strategy close at hand. Dust off—or create—the organization’s SWOT analysis, a planning technique used to identify:
- Strengths: What do you do better than competitors?
- Weaknesses: Where do you fall short?
- Opportunities: What market needs are underserved?
- Threats: What could disrupt your value proposition?
SWOT helps identify internal and external factors that are favorable and unfavorable to your industry—and ensures your definition of value aligns with strategic reality.
4. Identify Critical to Quality (CTQ) Characteristics
What matters most to each customer? These CTQ characteristics vary by customer and situation:
- For some, it’s price
- For others, it’s speed
- For many, it’s reliability or service
Understanding each customer’s CTQs allows you to deliver value where it matters most—not where you assume it matters.
Create Memorable Customer Experiences
Finally, take every opportunity to create a memorable customer experience.
I recall when an electrical contractor called with an urgent order for an outdated air circuit breaker that had an 8-week lead time. My factory expedited that special order unit in 10 days (at a premium price, of course).
This required me to fly from San Juan to Miami and back the same day to pick up a set of critical components for the breaker.
That customer was grateful for the “above and beyond” service attention. Their CTQ? Maintaining a hospital fully equipped with auxiliary power. For them, speed wasn’t a nice-to-have—it was critical.
Forming this excellent customer experience allowed us to develop a strong relationship that went beyond the initial sale for many years. The premium we charged for expediting was nothing compared to the lifetime value of that relationship.
Key Takeaways
| Approach | Purpose |
|---|---|
| SIPOC / Value Stream Map | Understand the chain of value from suppliers through customers |
| Voice of Customer | Directly solicit feedback on needs and concerns |
| SWOT Analysis | Align value proposition with strategic position |
| CTQ Identification | Pinpoint what matters most to each customer |
| Memorable Experiences | Go above and beyond to build lasting relationships |
Ready to Better Understand Your Customers?
If you’re not sure what your customers truly value—or suspect there’s a gap between what you deliver and what they need—we can help.
Our Process Assessment & Capability Analysis includes Voice of Customer techniques to identify what matters most to your market.
Contact us to start the conversation.