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Gaining a Sustainable Advantage - Customer Perception of Value PCV19

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Alan Albert led a session at ProductCamp Vancouver 2019 called "Gaining a Sustainable Advantage." Focusing on Customer Perception of Value, the session includes tips on conducting your own value discovery interviews, and how this insight can be used to guide more effective innovation, marketing, and pricing.

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Gaining a Sustainable Advantage - Customer Perception of Value PCV19

  1. 1. Gaining a Sustainable Advantage: marketfit.com alan@marketfit.com @A_Albert Alan Albert Strategic Services for
 Measurable Growth Presentation copyright © 2019 Alan Albert All rights reserved
  2. 2. Cute Friendly Soft Fur Fetch Potty Trained
  3. 3. $10
  4. 4. Minimum Viable Puppy v0.9 Feedback?
  5. 5. Asking customers if they like your product 
 is like asking “is my puppy cute?”
  6. 6. __% Fail?
  7. 7. >80% Fail $29.5 billion spent creating features that aren’t used
  8. 8. If our current best practices are so good, 
 why is our failure rate so high? 
  9. 9. IDEAS BUILD PRODUCT MEASURE DATA LEARN This is the expensive partThis is the important part Why do we save learning for last?
  10. 10. Why build before you measure?
  11. 11. Why sprint before you know the right direction?
  12. 12. Why fail fast? 
 Why not focus on succeeding sooner?
  13. 13. B2B Products & Services B2C Products & Services Startups Bootstrapped Venture-funded SMB Fortune 500 Cognitive Psychology Computer Science $1B X A bit about me…
  14. 14. Agenda The Need for a Better Approach Customer Perception of Value Case Study How To
  15. 15. >80% More $ NO Optical Drive NO Ethernet Port NO Media Card Slot NO replaceable battery ONLY 1 USB slot SLOWEST processor
  16. 16. Introducing 
 Customer Perception of Value
  17. 17. Customer Values = motivations goals concerns emotions what people care about the “why” that makes them buy
  18. 18. Minimizing costs Increasing revenue Reducing risks Social interaction Gaining confidence Making friends EXAMPLES OF CUSTOMER VALUES Environmentally friendly Socially conscious Rapid deployment Minimizing disruption Global presence Local office Convenience Wide selection Low price
  19. 19. PRODUCT VALUES FEATURES BENEFITS
  20. 20. PRODUCT VALUES FEATURES BENEFITS
  21. 21. PRODUCT VALUES FEATURES BENEFITS START HERE
  22. 22. PRODUCT VALUES FEATURES BENEFITS PRODUCT VALUES FEATURES BENEFITS People with different values 
 choose different products
  23. 23. People with different values 
 react differently to the same product
  24. 24. New definition of Market Segment: 
 People who share 
 the same perception of what’s most valuable.
  25. 25. You can segment your market by 
 Customer Perception of Value. Segmentation ➝ Differentiation ➝ Pricing Power
  26. 26. Values Drive Our Behavior Buying Usage Retention Recommendation Values Drive All Behavior
  27. 27. Customer Perception of Value hard to change sparks emotion discoverable measurable You can easily change ideas products or services markets or segments positioning and messaging
  28. 28. What Your
 Customer 
 Cares About Your Idea 
 or 
 Solution What your customer will talk about What you won’t learn
  29. 29. The next time you talk to a customer, try not mentioning your idea, product or feature at all.
  30. 30. Changing the Product to Find a Fit CUSTOMERS x ? PRODUCT x
  31. 31. Understanding Customer Perception of Value helps us make better use of product analytics.
  32. 32. Designing for Customers’ Values CUSTOMER
 PERCEPTION OF
 VALUE UNDERSTANDING OF VALUE
  33. 33. Designing for Customers’ Values CUSTOMER
 PERCEPTION OF
 VALUE UNDERSTANDING OF VALUE PRICING MARKETING INNOVATION helps build a sustainable competitive advantage
  34. 34. Designing for Everyones’ Values CUSTOMER
 PERCEPTION OF
 VALUE UNDERSTANDING OF VALUE Features not valued reduce CPV
  35. 35. CUSTOMER
 VALUES PRODUCT
 VALUES MARKETING “PROMISE OF VALUE” PRODUCT -MARKET FIT Designing for Product-Market Fit
  36. 36. Understanding Customers’ Perception of Value 
 provides long-term guidance for sustainably innovating in directions they’ll care about marketing in ways that motivate action pricing for things worth paying for
  37. 37. Agenda The Need for a Better Approach Customer Perception of Value Case Study How To
  38. 38. Case Study - Infobip Global Messaging Infrastructure
  39. 39. Case Study - Infobip Research & insight into Customer Perception of Value Challenge: Sucessful global market leader,
 dissatisfied with growth in N.A. Used surprising CPV insights to revise their value proposition First Step: Next Step:
  40. 40. Case Study - Infobip
  41. 41. Case Study - Infobip Recommended new Pricing Model
 based on discovered customer values $ / Transaction ➔ SaaS subscription New Pricing Tiers, Bundles & Add-ons Free Service & Support ➔ Paid
  42. 42. Case Study - Infobip Subscription revenue target for entire year reached in month 2 Support Dept. on path from cost center to profit center by month 6 Gross profit for SMB segment 
 increased by 3x - 5x Product Managers happier, too! Results:
  43. 43. Case Study - Infobip “I think the single biggest problem in Product today is that folks who build products don’t know enough about their customers — yet they assume that they do.”
  44. 44. Customer values are discoverable, measurable 
 and quantifiable. Why skip this step?
  45. 45. Agenda The Need for a Better Approach Customer Perception of Value Case Study How To
  46. 46. Discover ➔ Measure ➔ Validate
  47. 47. http://nyti.ms/22y5HEK N.Y. / REGION After Funeral and Cremation, a Shock: The Woman in the Coffin Wasn’t Mom By MICHAEL WILSON MARCH 21, 2016 After a long battle with cancer, Val-Jean McDonald, mother of eight sons, with more than 20 grandchildren, almost as many great-grandchildren and three great-great- grandchildren, died on Dec. 18 at the age of 81. Her funeral, 11 days later, attracted scores of mourners to Union Baptist Church in Harlem: her sons, from Manhattan, New Jersey, Georgia, Texas and Australia; other relatives and friends; and people who had never met her but knew her children. They all filed past the open coffin, seeing familiar remnants of Ms. McDonald’s life: a favorite pink blouse and white suit, and her finest jewelry. “Why did they cut off all her hair?” a son, Errol McDonald, 57, remembers thinking. “Maybe it’s the cancer.” He bent and kissed her. But sometimes children see what adults cannot. Adults rationalize. Children call it like it is. “My 10-year-old son said, ‘Daddy, that’s not Grandma,’” recalled Mr. McDonald, a school maintenance worker in Manhattan. “I said, ‘Yes, that’s what happens,’” he told the boy, explaining that people can look different in death. The next day, the family attended Ms. McDonald’s cremation at Woodlawn
  48. 48. Why not just ask “what are your values?”
  49. 49. Explore the past reality, not the unpredictable future
  50. 50. Each Audience Perceives Value Differently Buyers / Purchasers ApproversDecision Makers Scouts / Influencers Users Evaluators Focus on one audience at a time
  51. 51. Awareness Consideration Purchase Usage Advocacy Customer Journey Different Perceptions of Value Along Customer Journey Focus on one context at a time
  52. 52. • Never pay for subjects Talk only to people who care • Gain insight with live interviews Use surveys for screening audiences • Avoid yes/no, a/b or forced choices Let them use their own words • Don’t mention your product or features Learn what they care about • Quantify the intensity of their values Learn which values matter most • Don’t disagree, prove or sell Learn what they think Customer Perception of Value Research Tips
  53. 53. Ask them to describe their behavior in your chosen context What did they actually do in that context? Ask only about the past — not the present or future Then ask about their thinking at that time What led them to do the things that they did? How did they go about making their decision? Don’t ask about features. Focus on how they decided. Interviewing for Customer Perception of Value
  54. 54. Ask your neighbor to name a purchase they made recently. Focus only on their buying decision in their customer journey Ask them to describe their behavior What did they actually do in that context? Ask only about the past — not the present or future Then ask about their thinking at that time What led them to do the things that they did? How did they go about making their final decision? Customer Perception of Value Mini-Workshop
  55. 55. Insights into Customers’ Perception of Value
  56. 56. Innovation that matters Marketing that motivates Pricing that outperforms Use Your CPV Insights to Drive
  57. 57. Customers Perception of Value as North Star
  58. 58. The ROI of Understanding Values Faster sales cycle More customers More revenue per sale More customer retention More referrals Lower risk of failure Lower cost of development Lower cost of acquisition Cost Savings Revenue
 Profit
 Market Share
  59. 59. to you The Value of Understanding Values
  60. 60. marketfit.com alan@marketfit.com @A_Albert Alan Albert Gaining a Sustainable Advantage: Strategic Services for
 Measurable Growth Presentation copyright © 2019 Alan Albert All rights reserved

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