Customer value proposition

In the late 90s Kim and Mauborgne of INSEAD University introduced value innovation, again fuelling the strategy debate with a new approach contrary to Porter's positioning approach.

Treacy & Wiersema introduced the concept of a company not being able to be all things to all customers after the value innovation research of Kim and Mauborgne of INSEAD University in the late 90's.   It is sufficient to excel at one set of customer value attributes, and to maintain at least benchmark standards on the others when selecting a customer value proposition of either operational excellence, customer intimacy, or product / service excellence.

This section on the customer value proposition is being developed, and will be expanded.

 

Customer value proposition options

 

Value dimension

Operational excellence /lowest total cost of ownership

Customer intimacy / Complete customer solutions

Product leadership / Superior products and services

Product / service attributes

Price

Differentiator General requirement General requirement

Quality

Differentiator General requirement General requirement

Time

Differentiator General requirement Differentiator

Selection

Differentiator General requirement General requirement

Functionality

    Differentiator

Relationship

Service

General requirement Differentiator General requirement

Partnership

General requirement Differentiator General requirement

Image

Brand Smart shopper (price) Trusted brand (relationship) Best in class (innovation)

Example

Get take-aways from McDonalds
Eat at your favourite restaurant in Melville
Eat at Villamoura.

It will still your hunger fast and efficiently, meet government health regulations, and not cost an arm and a leg.

But don't demand something extraordinary for the price you pay.

You will be greeted by name at the front desk, pampered with personal attention, and the manager will come over to ensure you get whatever you want.

But it comes with a hefty built-in service charge.

You will get the best food and service available.

But then again you have a thick wallet.


 

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