This Is Experience-Driven Value Creation
Creating Customer Value by Shaping Ideal Experiences
What sets two power drills apart isn’t the hole in the wall. It is the experience of drilling that hole. But not just that. It is also the experience of receiving the drill, reading the packaging, opening the box, learning how to use it, charging it, changing bits, childproofing it, accidentally dropping it on the floor and (maybe) having to repair it. Each of these moments has the potential to delight or frustrate, to win a fan or lose a customer. Experience-Driven Value Creation is about turning these moments into reasons why a brand becomes its customers‘ favourite.
The Premise
Today’s market reality is challenging: product and service quality is becoming increasingly similar across competitors, customers are better connected and informed than ever, and most industries face oversupply—making it hard to stay relevant without price-cutting.
Long-term success requires finding ways to go beyond the basic problems and desires that everyone else is solving, giving customers compelling reasons to consciously and repeatedly choose you over other providers.
Experience-Driven Value Creation can help you find those reasons.
The Idea
Experiences drive every purchase decision. First, an experience—whether encountering a problem or desire— sparks our initial motivation to seek a solution that transforms our current state into an improved one. Then, our preference for a convenient and rewarding experience influences our choice among available options. Finally, the actual experience of using the solution either reaffirms or alters our perception of its value.
So, experiences aren’t just a part of the customer journey; Experiences define a customer‘s journey from beginning to end.
The yardstick of every experience is our expectations. Our expectations serve as a baseline – a reference point against which we measure what actually happens.
This evaluation can have three outcomes:
- Frustration:
The experience falls short of expectations, making the solution appear less valuable than initially thought. - Adequacy:
The experience matches expectations, confirming the anticipated value of the solution. - Delight:
The experience exceeds expectations, causing the perceived value of the solution to increase significantly.
It is these judgements that determine whether customers perceive a problem as worth solving, whether they become customers, remain customers or look elsewhere.
With the goal of avoiding frustration, exceeding adequacy and achieving delight, Experience-Driven Value Creation is about identifying and optimising the individual value drivers of each moment of the customer journey – from encountering a problem, through searching for a solution and dealing with a provider, to using the solution – considering customer expectations.
The Key
The key to mastering EDVC is the value creation triad.
Generally, there are three distinct ways in which a company can provide value to its customers: by what it does, how it does it and why it matters.
- What a company does:
Refers to everything it produces – the products, services and touchpoints they create, along with their functional benefits – and what these things enable customers to do - How a company does it:
Refers to the specific way in which it executes its solutions and the benefits this brings to the customer - Why it matters:
Refers to the bigger meaning behind a company’s actions and existence and the emotional and tangible benefits this creates
Customers continually assess these three value drivers at every step of their journey from encountering a need, to searching for a solution, to using the product or service. Each step provides an individual mix of customer value, driving their experience.
To become and remain a customer‘s preferred choice, however, a company must find a way to leverage at least one of the three value drivers to its advantage:
By strategically adjusting these drivers through innovation (a new what), design (a better How) and branding (a meaningful Why) companies directly influence the experience customers have and the judgments they form – creating a foundation for relevance, loyalty and preference.
However, these three elements should never be considered in isolation. A company may have an innovative product (What), but poor design (How) or a weak brand (Why) can undermine the solution’s potential value. Conversely, a thoughtfully executed solution (How) that successfully expresses a meaningful ideology (Why) might still fail if the core benefit (What) is underwhelming.
To create solutions that are simultaneously useful, customer-centred and emotionally meaningful, companies must align the What, How and Why into a cohesive Value Creation Triad – maximising the potential value of their solutions.
The Aproach
EDVC is ultimately about adjusting and aligning the What, How and Why a company provides at critical moments throughout the customer journey, aiming to exceed customer expectations and deliver maximum relevant customer value.
The EDVC approach involves four steps:
- Identifying negative experiences (what doesn’t feel right?)
- Assessing expectations (what do customers expect?)
- Defining the ideal experience (what would be an outstanding experience?)
- Refining the value drivers (How do we adjust the What, How and Why to make the ideal experience a reality?)
The EDVC process applies these steps across the four key phases of the customer journey:
- Need phase – the circumstances where a problem or desire emerges.
- Orientation phase – where customers explore potential solutions.
- Customer phase – every direct interaction with a company.
- Usage phase – every interaction related to the product or service.
By running through these steps in each phase of the customer journey, companies can uncover new ways to deliver relevant customer value.
Need help?
If you would like to learn more about Experience-Driven Value Creation or need help implementing it, please contact us. We are here to help.
Stefan Hermann, founder Baselift
