Customer value is the perceived value of your product or service to the customer. Products and services deliver fundamental elements of value that address four kinds of needs: functional, emotional, life changing and social impact.
Understanding this concept enables you to always craft value-adding and life enriching products and services for your customers and also achieve good commercial results.
A way to understand customer value could be to look at the basic attributes of a product or service that address four kinds of needs: function, emotion, life changes, and social impact.
Functional elements, for example, include saving time, reducing risk, and organizing. The pyramid below shows how value elements fit into the four categories.
Products and services deliver fundamental elements of value that address four kinds of needs: functional, emotional, life changing and social impact. In general, the more elements provided, the greater customers’ loyalty and the higher the company’s sustained revenue growth. Companies that deliver well on multiple elements of value tend to have stronger customer loyalty and higher revenue growth rates, as Bain & Company’s analysis shows. The research documents 50 companies that deliberately added elements over time to improve their propositions, either to turn around a flagging business or to accelerate growth.