The customer value proposition is more than the product or service. It is more than how you price it or promote it or through which channels you sell it. The totality of the customers experience is what matters.
This article authored by me is published in both the online and print versions of the SME Advisor Middle East magazine in the January 2011 issue. http://www.smeadvisor.com
Entrepreneurs, marketers and businesses often talk about the customer value proposition. It is often meant to describe how the core product or service is designed to be used by the customer. This is a fallacy and it ignores the need for a totality of experience approach that is required by any business offering any proposition in a competitive environment. A customer value proposition has to be viewed in the totality of the experience that the customer experiences. It is not just about how great the product is, nor how much of value for money that a product offers, or how it is promoted or through which channels it will be sold.
A fantastic personal experience!
I recently went to purchase an Apple product and encountered what I call a totality of experience of the proposition. Anyone who owns an Apple product knows the superiority of its usability or the product proposition. Have you ever wondered about the totality of the proposition experience?
At the end of December, 2010, I made my customary trip to Northern California to spend the Christmas holidays with my family. As it often happens, I was once again requested by a colleague of mine to pick up a “MacBook Pro” laptop for her son. I decided to make the purchase on a weekday after the holidays, as I wanted to avoid the mad shopping rush during the holiday period.
I went into an Apple store in Walnut Creek in Northern California. I was greeted very pleasantly by all the sales associates who made eye contact with me. Mind you, this is not the first time that I have walked into an Apple store. I have been there many times to get the iPads, iPods, the Macs and all that expensive stuff that has the potential to drastically diminish one’s disposable income quite significantly J
My focus normally would have been to get the best deal or the best value for money. The difference between this particular trip to the store and the previous ones was that I was not worried about the amount of money that I was going to spend. I was specifically requested to get a particular model for which I expected to be fully reimbursed by my colleague who had requested me to pick up the MacBook Pro.
So with no money worries, I focused my full attention and keenly observed on the store, its people, surroundings, service and types of customers.
Under promised and over delivered
For starters, I felt the shop was conspicuously located in downtown Walnut Creek. It seemed to be a universal trait for Apple stores to be so strategically located. I have been to their stores in Tokyo, London, San Francisco, San Jose and others. For example, the store in Tokyo is located in the Ginza shopping district, considered one of the most expensive real estate in the world!
My other observations were that the store was enticing and welcoming. Even if you had not planned to buy anything from Apple, I bet you that passing through the street where the store was located would have drawn you in. The store was brightly lit and all the electronic gadgets were well placed with enough space for someone to walk around. The prices and the model numbers and specifications were clearly displayed. Although that particular store in Walnut Creek appeared to be busy, I got the sense that I would get immediate attention and service as the number of sales associates on hand seemed more than adequate. In other words I sensed that I would not be hassled nor would I be confused nor would I have had to wait long for someone to assist me.
I was approached by a young lady who introduced herself as Raven. She had a very bright and pleasant personality about her. She was courteous, professional and extremely knowledgeable. Since I knew exactly what I wanted, she did not hassle me with a lot of up-selling and cross selling tactics that you would experience in other stores. She had what seemed to be a mobile gadget (an iPod touch) through which she placed my order and transacted the payment. She inquired if I wanted a receipt and that she could offer it by email as well as hand me a hard copy version. She showed my email address which was already stored in the system (based on my previous purchases) and rechecked with me to confirm if she had the correct email address.
After about 2 minutes or so after the order was placed, she logged on to a desktop system (which of course was a Mac) near her and confidently announced that the box would be delivered to me in about another 3 minutes. She explained that the stock was coming from upstairs hence the delay. I assured her that 3 minutes was not a delay at all. Imagine my surprise when I was handed the box roughly 2 minutes ahead of the promised 3 minutes. What an amazing experience – A classic case of under promising and over delivering.
Just imagine that! My colleague’s son was fully aware of the product and the model, my colleague and her son thought that it offered the best value for money. I walked into one of its store and picked up the merchandise and had one of the best shopping experiences that I ever had (and I hate shopping)! Just imagine the totality of experience that Apple has designed for its customers. It is not just the technological superiority of its cool gadgets, but rather a perfect end to end experience.
So what is the customer value proposition?
The customer value proposition is the totality of the end to end experience of the offer. This is a framework that entrepreneurs should seriously consider when designing the proposition. They have to think of the proposition experience in terms of the customer lifecycle. The key experience design elements of the customer lifecycle should include the different phases from the time the customers gets to know of your product or service to the time the customer leaves you.
Getting to know
- How do you make the proposition known to your potential customers?
- How do your messages and advertisements look like to the customer?
- What is the visual experience that the target customers will experience?
- Are your messages friendly, easy to understand and differentiating from your competitors?
- How do you make sure that the customer will only receive a call if the proposition or service is appropriate for your customers?
- How will you make sure that you make the call to your customers only during appropriate times?
- How do you make sure that your agents can explain the benefits of your proposition, the relevant specifications and options available and if it is suitable for your customers?
Buying or purchasing
- What is the buying experience in the store, through a website or a call center?
- Are the processes simple, clear, non bureaucratic and easy to understand?
- What is the delivery time period? Is it complicated? Is there a long wait for delivery of the proposition?
- Are the prices confusing? Are the prices transparent, predictable and honest?
- Is your front line staff fully trained to explain and make the buying process easy?
- Do your customers have easy access to a sales channel to purchase the proposition?
- How do you make sure that the order capture process takes less than x number of minutes using a single form which can capture all options and scenarios?
- How do you get your customers to sign a single contract with a single set of terms and Conditions for the whole set of services?
- How do you make sure that once the customer has completed the purchase, that your sales agent goes through a checklist of information to set your customer’s expectations on the next steps?
- How do you make sure that your customer knows where he or she can go to get information about the status of their order once it is placed?
Activating or enabling the service
- How can the customer start to use the service?
- Is the signing on processes easy and simple?
- How will I make sure to inform the customer if there is any change to the customer’s appointment date?
- Is the proposition easy to use?
- Is it complicated and cumbersome?
- Is it confusing?
- Is it easy upon your sales and service staff to explain?
- How will you make sure that the activation process will feel like your customer is receiving a single product, rather than a group of separate products stitched together
- How will you welcome the customer once the service is activated and or enabled?
Invoicing and or billing experience
- Are the invoices easy to understand? Is it confusing? Are the bills delivered promptly?
- How will you make sure that you give the customer a choice of billing options?
- How would you make sure that your customers have a choice of payment channels local to your customers?
- How will you give confirmation to your customers when their payment is received and when it is allocated to their account?
- How will you make sure that your customers are able to reach you?
- How could a customer leave your service and get refunds and final bills?
Seize the opportunity and laugh your way to the bank!
I am sure that most of you would agree that the service levels for most industries and businesses in this region could be better when compared to similar businesses in developed markets.
As an entrepreneur or small business person, this might be a tremendous opportunity for you to differentiate in your space as most small (and some large) businesses try to limit allocation of resources to this important aspect of the business. Planning and thinking seriously through the end to end experience of your customers might be the winning formula required for you to win in your market space and delight your customers. In the end this will pay off handsomely and will not only be delighting your customers but you will be laughing you way to the bank!
John Lincoln – All rights reserved email@example.com Twitter @lincolnjc