Do you understand your Value Gaps?

In our last two posts we shared how to use personas and creating an evolving customer journey. Now that you have a baseline understanding of who your customer is - it's time to begin identifying the gaps between their expectations and what you provide.

Few marketers would dispute that value is created through consistently meeting your customer’s needs and expectations. In fact, it is the sum of their experiences that leads to their loyalty or starts them on a path of looking for alternative solutions. When a customer’s expectations are met, value is created for them and in turn for you. When there is a discrepancy in what customers expect versus what they experience, or in what they need versus what you deliver, there is a “value gap”. These gaps lead to customer dissatisfaction, switching, sales losses, and ultimately destroy value for your organization, so understanding them should be a top priority for your company.??

What is a Value Gap Map???

A value gap map is a visual representation of the amount of value a customer expects across their journey vs. the amount of value they currently receive. A good map spans the entire customer lifecycle and highlights the discrepancies between the perceived and actual value of a product or service AND your marketing, sales, and service efforts. A value gap is when users expect or need one thing and experience another. ?

It isn’t always enough to just meet your customer’s expectations; you’ll also want to understand if your competitors are doing a better job than you and exceeding them. Looking at each touchpoint and understanding the value you are delivering versus the value your competitors are delivering will help you understand where you are likely losing customers in the journey and help you prioritize which gaps to close.?

Why are Value Gap Maps Important???All companies have value gaps – If you pick any product or service that you love, I’m sure you can still find something that doesn’t quite meet your expectations. Sometimes you stay with that company because the rest of the experience is so great that you simply overlook some of the frustration, but often the pain points are greater than the value being derived and you will begin to seek out alternative solutions.??

A Value Gap Map uncovers stages in the journey where customer expectations are not being met by current efforts, information and offerings, or where your competitors are simply doing a better job. These are the touchpoints that might result in your prospects abandoning the buying journey, or your customers switching to a different solution.??

A Value Gap Map should be built to:?

• Prioritize gaps in the journey to focus on improving?thru experiments
• Identify root causes of the value gaps and hypotheses on how to close them?
• Inform development of your plan - how will you create value going forward

Value Gap Maps are based off a single persona and their customer journey. This is critical because the needs of your personas will vary as will the steps they take throughout their journey. Value must be looked at through the eyes of a specific persona.???

How to build a Value Gap Map?

Building a Value Gap Map requires your organization to think about each stage in the customer journey along three dimensions:?

1. ?What does the customer need/ value? What the customer is trying to accomplish in each stage/ touchpoint? How important is achieving this goal to the customer relative to their other needs???
2. ?How well do you deliver on those needs? How well does your competition deliver on those needs? How easy do you make it for them to accomplish their goals at each stage? What are the proof points that support how well you meet their needs (e.g. high engagement rates, or high renewal indicates needs are being met)? Are their needs being better met elsewhere? How? How easy does the competition make it for customers to accomplish their goals???
3. ?Where are the value gaps and how big are they? Do we meet the needs of the customer as well or better than the competition???

The goal is to marry your internal view with the external view so that you can complete a picture of where you are delighting customers and creating value, and where you are losing value. When you combine your customer journey touchpoints, data on performance for those touchpoints, customer insight, and your competitive understanding, you can identify the value gaps, and even the size of the gaps, that provide you with a starting point for determining how to create more value for your customers.??

Value Gap Maps require cross-functional insight. There isn’t a single function that knows your customers or competitors inside and out. To build a value gap map, you need a cross-functional team that can help look across product, sales and marketing – taking the customer journey map (presumably they built together) and understanding its points of value creation and value deficiency. Consider the critical parts of the journey and make sure those team members are represented. Depending on how you are structured and your team’s skills and capabilities, adding an analytics team member can be extremely helpful.?

If you can’t get the support of other functions, get started with what you can, go as deep as you can in the other functions – and share what you have put together as it may spark new interest or insight. Ask to listen in on sales calls, customer service calls to get a sense of the issues and questions being raised that will help you provide some of that information upfront.???

Data should be the backbone of your value gap map.?Come to the table with the data you have internally that can be used as a starting point. Most companies have customer research across the journey to help them understand win/loss, product satisfaction, loyalty drivers, etc. Understanding where in the customer journey you are losing your customers and at what rate is a good starting point for identifying your value gaps. You don’t need to have a complete picture, but the exercise of aggregating what you know about the customer and laying it out to see where the problem areas are leads to good discussion and possible solutions to the value gaps. It is rare for companies to lay all that they know about their customer out to look for symptoms of value loss across the journey, but laying out what you know, what you think, and what you don’t know is as important as identifying the gaps. All too often, team members are not operating with the same understanding. By working together to review the customer, their journey, what they value and the proof points of how well you deliver against it helps everyone have greater depth of knowledge to be more effective in their jobs.??

Competitive understanding doesn’t have to mean lengthy research. Your internal data will set the stage for how you deliver value to your customer, but it is equally important to spend the time to research what your competitors are doing to deliver on those needs. Put yourself in the customers shoes, literally. Start from the beginning and try and find a solution to your problem, look to see how easy it is to find your competitors. Can you answer the customer’s questions just by visiting their website? How easy is it? You can just spend some time experiencing your competitors process and comparing it to yours to identify stages where gaps exist. In today’s marketing environment, speed is the essence. Find quick solutions to gather market insight to inform areas of investment.???

In the financial services industry, companies are working to transform into Fintech organizations and revolutionizing an antiquated industry. A more established financial services player discovered a shift in their acquisition rate. They knew that being able to demo their solution and gather pricing was an important step in the journey for their customers, and they provided this information to their customers through their sales force. However, in going through a value gap map exercise and doing some online competitive reconnaissance, they realized some of their Fintech competitors were providing real-time online demonstrations of their solution as well as pricing estimates. This greatly reduced the effort a prospect must go through to get to relevant information to make a decision that enabled customers to broaden their consideration set more easily. It greatly matters how easy you make the customer journey if ease of doing business is of value to your persona - and that starts with mapping the journey and measuring the points of satisfaction and frustration.??

Understanding the Value Gap Requires Measuring it. While judgement can give you a good indication of how well you are delivering against the needs of your customers along you journey, measuring it will give you the data-backed proof to support investing in closing the gap. Common measurements used along the customer journey are Net Promoter Score (NPS) or Customer Satisfaction surveys (CSAT) – both of which can provide insight across the journey to include in your value gap map to highlight points of satisfaction and frustration. The Customer Effort Score (CES) is being used by customer service more and more but has application across the journey – how much effort is required by the customer to achieve their goal or accomplish their task? Each stage should have a baseline metric that gives you some indication of how delighted or frustrated your customer is with respect to being able to accomplish their goals.???

Taking Action: What to do about the gaps?

Gaps come in many forms – information you need that will help you market better, areas your competitors are outperforming, needs your customers have that are simply unfulfilled. An important first step is to prioritize the value gaps – which gaps/ stages of the journey are most important to focus on improving and why. If you have a churn issue, it is likely you will want to prioritize very different aspects of the journey than if you have an acquisition issue. Once you have honed-in on which stage of the journey needs addressing first, you will also want to understand the relative value of the different needs of your customer so you are aligning your resources against closing the right gaps. These gaps are opportunities for your organization to create value, and developing hypotheses for how you can close the gaps will help you develop a longer-term strategy for creating value for your customers.?

Value gaps and your hypotheses for how to close them should be turned into a learning agenda. A learning agenda defines what you are seeking to better understand about your customer to be able to effectively close the value gaps. It is a prioritized list of hypotheses you have about how value can be created and information you need to make more informed decisions. This tool puts learning front and center for your marketing team – enabling a structured approach to learning that is missing in many marketing departments today.??

Tools for activating value gap maps: 

1. Learning Agenda - defines what you are seeking to better understand about your customer to increase your value delivery

2. Experiment and Testing Plan - enables structure around testing hypotheses to achieve learning objectives

3. Marketing Measurement - tracking results to determine the effectiveness and efficiency of your marketing efforts