The purpose of the Value Exchange is to articulate how a brand will deliver value to a customer that is commensurate with their level of commitment. The concept is most relevant to platforms and programs that are designed to engage customers over time; examples include loyalty programs, newsletter subscriptions, and customer self-service capabilities delivered via digital channels. Establishing an effective value exchange can be challenging, as it must be attractive to the customer (or they won’t join), simple for the customer (or they can’t join), and achievable for the company (or they can’t afford it). This framework helps teams explore different dimensions of value in a reciprocal way.
Why would a customer join and remain engaged with our program?
- Clearly define the scope of your program to provide focus and useful constraints. Then identify potential ways that the business and customer can provide value, considering a broad set of value dimensions.
- Starting with your business and fully explore different ways to provide value using the dimensions as a guide. Make sure to not only focus on traditional promotional incentives, and explore more extrinsic benefits.
- Shift your attention to how customers can provide value to your business. Make sure that you do not focus purely on customer transactions, but consider the value of assets like first-party customer data.
- Prioritize the potential benefits on both sides of the value exchange. For each benefit, analyze its perceived value and the feasibility to provide. Include those that are most attractive and easy to execute.
- The final step is to establish balance, pairing the right set of benefits provided by the business to the related contributions required by the customer. The relationship must be clear and the value must be mutual.
- Make sure to consider all of the ways that you can unlock value for your most valuable customers.
- Resist the urge to ask for unnecessary customer data during the enrollment or onboarding process.
- Remember that program experiences can be tailored over time to the preferences and value of customers.
Peppers, D., Rogers, M. “Managing Customer Experience and Relationships”, Wiley, 2017