Here is a very unique scenario. You are in the middle of building your value model for a new product or service and you realize you have a dozen potential drivers of positive differentiation you can choose from. This is great problem to have but it can create some issue with how to select the most appropriate value drivers for your value model.
It is typically recommended to use a maximum of three to five drivers for a specific value model. So how to pick three or five from a list of twelve val
How do you quantify the economic value that you provide to customers? Leading B2B companies adopt a value-based pricing strategy, grounded in understanding how you create more value for customers with differentiated products and services. And quantifying tangible value drivers such as reduced inventory costs, or increased revenue through faster time to market can be simple enough, but what about the value drivers that are not as easy to measure? How can you quantify (and justify) the value of r
Leading B2B companies know and understand how to effectively sell the value of their products to customers. Yet selling multiple products or modules together to create complete solutions for the customer presents its own unique set of challenges. In return for giving you, the supplier, all of their business, customers expect a volume discount. But in fact, for many vendors, the ability to offer complete solutions to customers can be an important competitive differentiator. And instead of capturi
Value modeling requires teamwork. Best practices show that this exercise demands the involvement of several functions in the organization: marketing, pricing, sales, finance, innovation, R&D, operations and others when needed. By working together, teams converge to reach consensus on value driver measurement models, the level of driver economic value and the value messages for every stakeholder. Convergence is critical for collaboration between functions and managing the complexity of value
Last week Harry Macdivitt of Axia Value Solutions joined us to discuss how to capture the value of your products and services. In part one of the interactive Q&A he shares his thoughts on avoiding discounting and training salespeople how to sell value. Below he answers the audience's questions on using data to quantify value, how to quantify buyer emotions, and selling to government.
Q: What advice do you have about using data to quantify customer impact? Do you need to have the precisely ac
In last week’s webinar “Incorporating Value in Your Stage Gate Process”, Dr. John Hogan of Value Management Advisors discussed his value-based framework for improving product development processes. Of course, no process can guarantee success, but the problem is stark: as seen in the chart below, based on evidence from PDMA’s new benchmark study, 76% of all new product launches fail to meet their revenue targets.
In our February 2013 webinar, "Incorporating Value in Your Stage Gate Process," Dr. John Hogan joined us to identify common value leaks, and using real customer examples, showed how to seal them by incorporating "value gates" into your development process. Click here watch the recording.
Q: Why are folks now more interested in thinking about value earlier in the product development process than before?
A: There are two fundamental changes in the marketplace going on. At the macro-level, coming
Nothing in business is static. Things change quickly, suddenly, and frequently. The same goes for value models. A value model will quickly be outdated, irrelevant, and obsolete. This is due to the dynamic nature of the critical elements used to model value. Value models need refreshing, need reworking, and need to reflect the dynamic change happening in the market place. I therefore conjecture that organizations using value-based pricing and building value models should do these activities dynam
In Part 2 of a two-part post, we address more questions from the webinar attendees based on the challenges they face during the New Product Development (NPD) process. Click here for Part 1.
Q: We are launching a new product in two years. The current next best alternatives have had difficulty getting traction after launch and have lowered prices significantly. Are there good ways to forecast future NBA prices when the market is dynamic?
A: Excellent question. Obviously depending on industry dyna
In this week's webinar "Quantifying Value: Working Through the Math", Ed Arnold and Roberto Rivera shared their hands-on customer experience in dealing with common value quantification issues. Two issues they focused on this time were: 1) how to quantify so-called "intangibles" like brand-image; and 2) how to quantify the "value-add" of a bundled offer (versus giving a discount). We plan to address more of these value quantification challenges in future webinars because of the high turnout and g