Identifying, quantifying, communicating and selling customer value in industrial context - Case: Supplier Alpha

Abstract

Customer value has become one of the most essential concepts of the past few decades, especially in the industrial B2B -environments. Companies are moving away from price-based competitive approaches and bulk offerings, looking for new ways to attract and win over customers. Truly knowing the needs of one's customers is a competitive edge hard to replicate, and companies around the world have also realized that value-based selling often works very well. However, despite the obvious benefits, only a few firms have the knowhow or tools to really take advantage of the knowing their customers.

The objective of the study was to investigate customer value in B2B markets, putting specific emphasis on identifying, quantifying and communicating value. Existing literature provides insights for the academic research, even though the fragmented research needs unification and more hands-on approaches. The case study provides insights into the industrial realm and aims to map out how customer value is currently identified, quantified and communicated at Supplier Alpha and it's customer organizations. Eventually, the study aims to help Supplier Alpha and other similar companies to understand how mastering customer value can impact overall performance. The study also aims to offer tangible suggestions and encourage companies to act on these essential issues.

The study was realized by combining academic literature with a single case study during which over twenty individuals were interviewed. The qualitative interviews were conducted with both Supplier Alphas as well as their customers' employees.

The findings of the study present a novel framework for total customer value in B2B - environments, methods for quantifying and communicating value and managerial recommendations regarding customer value in industrial contexts. In brief, companies need to understand and know their customer better to be able to offer them what they truly need. Quantification of customer value proved to be very difficult and still much research is needed on that front. Communicating and selling value successfully requires established personal relationships and also a significant amount of trust between the parties. Skilled employees and their wellbeing play a vital role in the process.