Unlock Revenue By Driving Customer Value

For tech companies that have evolved from product-selling to value-selling, building a framework for managing customer value is essential in driving Customer Lifetime Value (CLV) and revenue growth.

Dissecting What Drives Customer Value

Based on different business models, there have been numerous theories and methodologies in maximizing customer value. As a Customer Success Manager (CSM) who has nurtured 300+ LinkedIn Ad clients from small to big, I have developed a framework for managing customer value: the Triangle.

Let's look at the factors of the Triangle:

• Demand: Customers perceive value from products and services only when their demands are met. Instead of asking "what do you want", conduct ample market research and competitor analysis to discover whitespace, and share growth opportunities with clients that a CSM believes are missing.
• Solution: In today's highly competitive landscape, tech companies increasingly weigh more emphasis on CSMs to deliver professional services as Unique Selling Point (USP). Value-adding services not only support operations, but also lead the customer value growth with strategic consultation.
• Insight: Needless to explain the importance of data. It is worth noting though, that data is not transferred into customer value, if not interpreted correctly into insightful and measurable actions by CSMs.

Client Success Story

How does the Triangle of Customer Value help CSMs retain and upsell clients? Here's one of my client success stories:

Demand: A customer in healthcare industry planned to activate LinkedIn advertising in want of growing followers (needs from client side). As the CSM, in addition to delivering the short-term campaign result with targeting and content optimization, I have discovered deeper needs in building brand trust in new markets when engaging with senior management (market whitespace).

Solution: How to measure branding performance, besides follower number? I have developed a new strategy to help the customer leverage more LinkedIn value to their benefits (strategic consultation as service).

To visualize branding measurement, I have introduced the metric of Topic Ownership, which takes into account both the quantity and quality of brand engagement, with comparison against competitors (product).

Insight: In one metric, the customer was able to see clearly where the brand stands in competition against other companies in target countries (data analytics). Also, by breaking down Topic Ownership in specific keywords, the customer could strategize content calendar, instead of posting randomly (action).

As a result, analytics-based consultation has increased the customer value, leading to a 400% advertising budget add-on. The customer's senior management in marketing has gained internal recognition in increasing brand awareness in foreign markets.

Drive Customer Value at Highway Speed

Consider the Triangle of Customer Value as similar to a car. It is a dynamic system in which demand acts as the engine, product the car parts, service the human driver, and insight the fuel. Customer value growth is the speed of the car, and the distance the car covers demonstrates the customer lifetime value.

What impacts the customer value if driving at city speed of 50km/h, or 120km/h on the highway? The answer is, the different weight on the factors of the Triangle.

In the age of product-selling, customer value was delivered through client (relationship building), operation (customer service), and product (tech & price). It is a sales-driven approach that delivers mostly short-term results (like city speed at 50km/h).

Value-selling was introduced as tech companies aim for long-term partnership and higher profit (like highway speed at 120km/h). Emphasis on managing customer value has shifted to market (identifying whitespace), insight (data-driven), and strategy (business development consultation), which construct much stronger client trust than product-selling approach.

Conclusion

Adopting the Triangle of Customer Value makes value-selling simple, manageable, and effective. It is designed for tech companies that believe in generating revenue through human intelligence and creativity, over price war.

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