5 Easy New Year’s Resolutions that Improve Value

by | Jan 12, 2015 | Quantify Customer Value

New Year’s resolutions are commitments to do more of the good things that benefit our long-term goals. Be it living healthier or expanding our minds, we know it all comes down to simply making a conscious effort to make more time for exercising or reading, and less time for doing other things.

Likewise for us tasked with increasing profits, we know that success comes from delivering real value to our customers. So whether you are in marketing, sales, product management, operations or finance, here are 5 easy tasks that you can start today which will move you in the right direction.

1. Make a List

Pick a favorite customer or market segment and make a list of all the specific ways your product/service offer touches them and how and why it improves their business. Brainstorm. The list can include specific product features or service lines or any customer-facing process in your company. When assessing business improvement, ask how the touch points either reduce the customer’s cost of operations or grow their revenue. Don’t worry about quantifying yet; that comes later.

2. Share it with collaborators

Show your list to colleagues who also work with that customer and ask them to add, revise, or delete. However, the rule is that any changes to this list must come with a reasonable argument around customer business improvement. You get extra bonus points if these colleagues come from departments outside your own. Do this right and you will end up with a different list than what you started with.

3. Make quick estimates of your value

Write down your best estimate of how much money you save (or grow revenue) for your customer. Shed that burden of needing to obtain precise, verifiable numbers, otherwise your efforts will soon grind to a halt. Instead, use whatever data is at hand, and if none is available, make your best educated guess. Then run your numbers by your collaborators to fill in the biggest gaps and give everything a reality check.

4. Take it outside for a test drive

Here we need to exercise caution because customer time, not to mention relationships, is extremely valuable. The task here is to get voice of the customer reaction to the major value-generating hypotheses. Take care in choosing who to talk to and how the questions are asked. Listen, but don’t defend. Test your estimates. Here you call them “estimates,” because experience has shown that customers are more willing to respond to numbers, e.g., “we estimate that companies like yours spend $5,000 a year on energy, is this accurate?” than asking them direct “how much does your company spend on energy per year?”

5. Iterate

A few good customer tests will do wonders in uncovering the strengths, weaknesses, opportunities and threats to your product/service offering’s competitive positioning. Use that feedback to tighten the market messaging as well as provide critical field intelligence to inform future strategic decisions about offer definition, pricing strategy and market segmentation.

Let’s make 2015 a great year for delivering and capturing more value in our business!

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