Breaking down customer value chains to stay competitive

  • Posted on June 15, 2020
  • Estimated reading time 3 minutes
breaking down customer value chains to stay competitive

This article was originally written by Avanade alumn Hugh DeWitte.

How do you compete when the old rules no longer hold? According to Harvard Business School Professor Thales Teixeira, the nature of competition has fundamentally changed. New business models and startups are stealing customers by breaking the links in how consumers discover, buy and use products and services. By decoupling the customer value chain, these startups, instead of taking on the big brands of the world head on, peel away a piece of the consumer purchasing process. 

The marketplace is littered with value-chain disruptors. Here are just a few:
  • Birchbox offers women a new way to sample a variety of beauty products from the convenience of their homes.
  • Turo doesn't compete with GM. Instead, it offers the benefit of driving without having to own a car - a big benefit now that we are driving less.
  • Acorn merged the robo-advisor model with automated savings, making it easier to build a nest egg with spare change.


Because of these seismic shifts in how competitors are chipping away at the customer value chain, marketers and sales executives must understand their customers’ behavior even more. You can win against the odds by connecting buying behavior to areas in the value chain that you can influence and own. If you start by gaining deeper insight into where your customers may get lost along their current buying path, you’re on the right track to flanking the competition.

Customers get lost on the journey due to:

  • Jarring inconsistencies: Different experiences within your different channels
  •  Poor data handoff across channels: Inability to get the answers they need
  • Impersonal and irrelevant content: Uncertainty as to whether you really know them or not
  • Lack of experience innovation: Disappointment from a clumsy or dated experience

To keep them, you must:

Finding the friction
When customers can smoothly find what they are looking for and have some fun along the way they begin to trust the experience. To gain this trust you must first find the places where frustration occurs. We call this "finding the friction." We ask, “Can they complete an online purchase easily?” (The technical side.) Do they believe you understand their needs? (The emotional side.) Making these determinations relates to their customer journey but also requires data to service that customer. Evaluating what you know about customers helps you make better decisions about how to serve them. It also helps you know what data you need to collect to enable better experiences. Then you can adopt new processes and practices that can alleviate the friction caused by unfulfilled customer expectations. 

Where to start – or begin again?
As investors, entrepreneurs, and startups respond to the dramatic changes precipitated by the coronavirus pandemic, it’s become even more clear that customer value chain disruption and adaptation will be the defining business trends of 2020. Companies need to answer the question” How can you make a lasting impression? It’s all about creativity, convenience, transparency and consistency, ensuring every aspect of your customers digital experience with you is easy, convenient and memorable. 

Demonstrating the ability to be resilient during these times requires understanding the customer and remaining steadfast to your pursuit of creative customer experiences. It’s about defending the customer value chain and fending off challengers even as the market tightens.

If you would like a thought partner with whom you can explore these issues further, please contact us directly. We welcome the chance to identify customer value chain advantages with you.  

Download the 5 rapid-response CX strategies to adapt to the ‘new normal’.


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