Four Ways to Increase Customer Value
Most business value is created through customer behavior; therefore it's important to clearly define which specific customer behaviors you want to drive so that you can focus on how to motivate and measure those behaviors.
Now the customer behaviors that are valuable to say, a bakery, might be somewhat different than those valuable to a hospital, or an accounting firm. Nevertheless, there are four core categories of customer behavior that encapsulate the vast majority of opportunities to create customer value across a wide range of different types of businesses.
It’s valuable to periodically review and make sure you are clear on all of the "value creating behaviors" that your customers could potentially engage in so you can come up with fresh ideas on how to motivate even more of those behaviors. It may be that you are focused on certain more obvious value-creating behaviors (such as buying your product) but not on other more subtle behaviors which, if focused on, could increase total customer value to your enterprise.
Here are the four major categories and common sub-categories of customer behaviors. Many of these probably apply in your industry, a few might not, and you may need to brainstorm some additional ones that are specific to your business. The list below can provide a useful starting framework to tackling your customers’ behaviors
Marketing Related Behaviors
We often think that value starts when the customer gives us his credit card, but the opportunity begins before that. There are behaviors that customers can engage in to make it easier for us to market to them. These include:
When customers engage in these behaviors they lower our marketing costs (we can reach our FaceBook subscribers for free where we have to pay FaceBook to reach others, for example), and of course they move themselves one step closer to buying, which creates a different type of value.
These are the behaviors we tend to think of first when it comes to creating value; however there are several distinct sub-categories which are important to consider as you may need to motivate these behaviors differently from the basic buying behavior. Here are six sub-categories of purchase behaviors:
The most powerful form of marketing is word-of-mouth. There are multiple ways your customers can create value by helping promote your brand and products. Here are three examples:
Finally, customers can create value for your enterprise in the ordinary course of using your product. Again these will vary by industry but here are a few common sub-categories:
I suggest you gather some colleagues together and brainstorm the matrix of value-creating customer behaviors in your business. You can use this list as a starting point. Remove those that don't apply and add specialized ones. Then consider the value opportunity of each; some are larger than others. Finally, consider which you are currently focused on and which might be getting overlooked. This might lead you to some fresh ideas for how to move the needle on your business. Call FROM if we can help!