Thursday, November 14, 2013

Value is in the Eyes of the Customer

The Subjective Theory of Value states that value of a product or service is based on the subjective importance of it to an individual. You can read more about the details and economic theory behind this on the link here.

Lets look at this theory in the light of customer relationships. There is evidence all around us that the value of certain relationships is different from customer to customer. Where one will value a social network presence of an organization more than visiting their physical office, others will have a different opinion.



So by implication, when dealing with customers, we (as an organization) are dealing with the subjective importance they have given to us at that time. It is important to mention time here as well. At this point of time while on my laptop, I assign higher value to self-service online tools as opposed to when I am near my bank for example. How often have you gone to an ATM and thought I am going to use my mobile app to check my balance? (If you said anything but "never" here, I want to hear from you!!!)

This all makes sense... but how can an organization control the perception? What can an organization do to remain high in importance for the customer?

We have been taught that you need to segment your customer base and address each customer demographic's need, whether it is by providing better service, individualization, or other techniques. It has been ingrained in us that the way to delight the customer is to go above and beyond what they expect from us.

Well, that has some truth to it. But what is the "above and beyond"? Who sets the bar?

Guess what... "The customer".

The value of any engagement is a subjective matter which as an organization you have no influence on. As an organization what you can do is facilitate the engagement, make it easier, make it memorable. But it that was enough is something that you have to leave to the customer to decide.

So the beauty of your organization lies in the eyes of your customer. What will you do to attract them? Marketing you say? Does marketing have a big influence on the "beauty" of your customer engagements?

Think about it....


2 comments:

  1. An interesting idea, it will be useful for some areas of business, but not for everyone. Often, small businesses use low-cost, and sometimes even free, versions of CRM systems. I once tried it best crm for small companies and still continue to use it, as it satisfies me completely and customers are happy.

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  2. Crm is customer relationship management that is an advance concept in modern era. To know your business properly just focus on the customer relationship management. Small Business All-in-one marketing automation

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