In a conversation with a colleague today, we came to discuss ‘client value’. Apparently he’s heading to a mgmt training session to learn all about what constitutes ‘client value.
What exactly constitutes ‘excellent client value’…?
As professionals, we nowadays, after we’ve all become ‘Agile’, and when the customer has finally become the one and only boss – we can today, in most of our business interactions, vote with our feet, since there in most cases are many competing offerings to chose from – often refer to ‘business value’ or ‘client value’, but it appears to be an evasive and fluffy concept, because few people, neither the customers themselves, nor the supplier sales guys, seem to be able to define what exactly consitutes excellent client value, over and above at a buzz word level, such as ‘great price/performance’, or ‘excellent service’ or ‘reliable and financially stable supplier’.
Let’s try to define a few categories or qualities that likely impact our perception or experience of client value:
- Price. Of course, as clients or customers, we are always looking for a bargain, to get the most value for our buck. However, as the old saying indicates, ‘you will get what you pay for’, price alone can hardly be the only determinant for your value experience.
- Functionality: For many purchases – but not all! – functionality plays a huge role for our perception of value. Examples include various app’s and other software packages, functional clothing, e.g. for skiing or sail racing etc.
- Quality (including performance). Obviously, we value quality stuff (whatever quality means in the specific context) over poor quality stuff, and often – but far from always! – there is a clear correlation between price and quality – ‘you get what you pay for’.
- Brand image. Some of us perceive value in a famous brand, e.g. BMW cars and motorcycles, Louis Vutton bags & accessories, Saville Row suits, Krug Champagne, Absolut Vodka, Rolex watches etc. However, it’s far from always the case that a famous brand product scores higher than some other less well known brand in any of the other value categories. The only thing you can be certain of when buying a ‘fashion brand’, is that you will pay more than you would for a less ‘cool’ brand. As an example, a number of years ago, when our respective kids were small, the aforementioned colleague and I decided to go camping for a few days, and we both needed to buy tents. My colleague, always looking ‘for the best and the best brand’, went with a premium brand Haglöfs Tent from the premium sports store, while I bought my tent from the local supermarket. There was about 10x price difference between the tents. Guess which of the tents had a leak during the unexpected rain…? 🙂
- Service. Service is an obvious ‘client value provider’ and key competitive edge in many businesses, such as luxury hotels and luxury restaurants, more generally, in any business labelled ‘service business’. But what many businesses in non-service domains (and unfortunately, quite a few also in service-domains!) fail to understand, is that service can be a key competitive advantage. For example: I recently had to buy a new cell phone to my daughter. We strolled around the various electronic gizmo providers in a large shopping mall, looking for a phone. After having been into maybe 2 or 3 different such stores, we decided to visit the Apple Store on the top floor. Even though the product was the same (the iPhone) in all stores visited, the ‘customer experience’ of the visit to Apple Store was totally different: in the other stores, more or less uninterested sales persons gave us their best sales pitch, without showing any interest in understanding our specific needs and preferences. Furthermore, both their body language and their way to communicate clearly demonstrated that these sales persons were only there because they needed a job – they had no detectable interest in neither the customers, their own jobs nor their products. On the other hand, in Apple Store, once entering the store, you get a polite, interested and friendly greeting from the staff, they immediately direct you to a ‘personal shopper’ who not only will try to sell you stuff, but really is interested in helping you finding the best possible solution to your problem, including a free migration of data from your old device to the new one. After this experience, my first place to shop any consumer electronics in the future will be Apple Store, even if I have to pay a bit more.
Are there any other ‘categories’ you can think of that impact your perception of client value ?
In our ever more competitive world, I see the ‘service’ category becoming more and more essential – critical – for each day, regardless of business domain. The notion of ‘service’ can imply many different things, depending on domain, but some key ingredients are the same, regardless which business or situation you find yourself in:
- Friendly, polite, respectful, competent and interested staff. Every client interaction should result in an increase in the client’s perception of your products, services or brand. It’s amazing what a difference an interested person can make, one who not immediately attacks you in the store with his/her sales pitch, but one who really attempts to understand your real needs, It provides an immediate sense of quality and service when staff really show interest, and furthermore are able to ‘read’ the customer – not all customers come alike, some prefer instant attention by staff, others want to browse on their own etc. Good service means (among other things) that staff must be able to ‘read’ the customer, and to create rapport, in order to figure out exactly what constitutes real value for this particular customer. This takes people skills, emphathy, interest and some training, but try that the next time you deal with a client, and you will notice an enourmous difference. Also, staff being ‘friendly’, with a positive and open facial expression and body language, should go without saying, but in many situations, that’s not the case (ever met a friendly taxi driver…? 🙂 By ‘friendly’ I’m not referring to the plastic smiles of some non-European airline cabin staff, nor the way-too-immediately-intimate-with-the-customer waitresses of US – friendliness (as with interest) must be natural expression of your own personality, it must come from your heart, not your brain – beware of the plastic smiles and robotic ‘have-a-nice-day’ so common in the US culture.
In summary: the silver bullet for excellent client value is a combo of good enough products, combined with excellent service by staff who really care about their customers.