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Business-to-business companies can use the elements of value as a compass when deciding where to add value to their propositions. Eric Almquist, a partner with Bain's Customer Strategy & Marketing practice, outlines Bain research on the 40 elements of value that are in play in the world of B2B decision-making.
Read the article: The B2B Elements of Value (HBR.org)
Related video: Lori Sherer on How Data and Analytics Can Enhance Value for B2B Customers
Read the transcript below.
ERIC ALMQUIST: We often think of the world of B2B decision making as being very rational. It's all about price, service levels, warranties, etcetera. Our research shows that that's not true, that there's a lot of emotion involved in B2B decision making. So for example, there's a lot of anxiety involved in big decisions that cost a lot of money, and can have a big impact on an organization, or even on one's career. We've done a lot of research with B2B customers. And we've identified 40 elements of value that are in play in the world today.
Some of these are table stakes, things that have to be done. Otherwise you don't have a business. You have to be ethical, for example. We've also found functional elements of value that have to do with the economic benefits to companies. We've also found that there are lots of types of value that have to do with ease of doing business. How responsive the vendor is, for example, can be very, very important.
Then there are individual types of value that have to do with, let's say, the careers of decision makers. Also their desire for learning, for example. And then there are aspirational types of value that really have to do with the buyer's desire to make the world or their company a better place.
At Bain, we understand how important B2B decision making is and how complex it is. So we actually surveyed over 2,000 decision makers in two industries, IT infrastructure as well as commercial insurance. And in analyzing this data, we uncovered the fact that, like in the B2C world, the more elements of value one delivers on, the better in predicting future revenue and Net Promoter Score.
Companies that want to use the elements of value should start by benchmarking how they're doing vs. their near-in competitors. Where are they doing well? Where are they doing poorly?
Next, they should begin to think about how to close those gaps where they're not doing well. And finally, they should think about what new elements of value should they add to their proposition going forward. There are lots of things that one can do. But the elements of value will help make sure that whatever you do, it's consistent with what your customers value.
The B2B Elements of Value
With 40 distinct kinds of value, B2B managers can identify what matters most to each set of important stakeholders.
Lori Sherer: How Data and Analytics Can Enhance Value for B2B Customers
How two companies enhanced the value of their services.
Elements of Value® Insights
What do customers want? Bain's Elements of Value® represent the deeper aspirations behind the purchasing decisions of B2B and B2C customers. Our insights explore the ways companies can go beyond price to offer more value.
First published in 2月 2018