Page 127 - HBR's 10 Must Reads on Strategic Marketing

CUSTOMER VALUE PROPOSITIONS IN BUSINESS MARKETS

operating hours per year, and significantly lowered energy
dollars per kilowatt-hour. and maintenance costs.

Document Value Delivered Make Customer Value Proposi-
tion a Central Business Skill
Create written accounts of cost
savings or added value that exist- Improve and reward managers’
ing customers have actually cap- ability to craft compelling cus-
tured by using your offerings. And tomer value propositions.
conduct on-site pilots at prospec- Example: Quaker Chemical
tive customer locations to gather
data on your products’ conducts a value-proposition
performance. training program annually for
chemical program managers.
Example: Chemical manufac- The managers review case
turer Akzo Nobel conducted a studies from industries Quaker
two-week pilot on a production serves and participate in simu-
reactor at a prospective cus- lated customer interviews to
tomer’s facility. AN’s goal? To gather information needed to
study the performance of its devise proposals. The team
high-purity metal organics with the best proposal earns
product relative to the next “bragging rights”—highly val-
best alternative in producing ued in Quaker’s competitive
compound semiconductor culture. Managers who develop
wafers. The study proved that proposals that their director
AN’s product was as good as or deems viable win gift
better than rivals’ and that it certificates.

maintaining sample integrity. Their prospects scoffed at this benefit
assertion, stating that they routinely tested soil and water samples,
for which maintaining sample integrity was not a concern. The sup-
plier was taken aback and forced to rethink its value proposition.
Another pitfall of the all benefits value proposition is that
many, even most, of the benefits may be points of parity with those
of the next best alternative, diluting the effect of the few genuine
points of difference. Managers need to clearly identify in their cus-
tomer value propositions which elements are points of parity and
which are points of difference. (See the sidebar “The Building Blocks
of a Successful Customer Value Proposition.”) For example, an

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