Prof. Deva Rangarajan: Customer Value Proposition

Once an organization has decided to become more customer focused the first thing an organization has to do is to start segmenting its customers once you identify the segments the next thing you do is to go about trying to identify the pain points now what remains is for the organization now to communicate to the targeted customer segments what is unique about their offering that the competition cannot offer now a tool that is used here is the customer value proposition our customer value proposition identifies all the benefits both tangible and intangible that a customer can get from the solution provider it is usually different from that of a mission and a vision statement and a USB a mission and a vision statement is usually made by top management and focuses on all the potential customer segments it also focuses on the employees of the organization it focuses on the shareholders suppliers or other regulatory bodies in which the solution provider works in where a unique selling proposition is actually specifically for every individual customer within a segment of customers and is usually made by your frontline salespeople or your key account executors the next step once you do this is to actually develop the value proposition which is mostly targeted towards individual customer segments and the people responsible for making a value proposition include product managers marketing managers business unit managers and sales managers now remember when you’re looking at a value composition you basically ask yourself what are the different kinds of benefits we’re going to provide and the different benefits could be a product benefit or it could be the extra value-added service benefits you provide or in many cases it could be the benefits that the customer wants to gain by being associated with your brand once you identify these benefits the next thing you ask yourself is how will the customer irate us with respect to the competition so a good value proposition should have in mind what are the needs of the customers and then the next thing you have to do is to benchmark yourself or the competition keeping in mind always that it is done for every segment of customers once you’ve done the value proposition it is still the challenge of the organization now to deliver on their promises

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