How Understanding Customer Value Can Change Your Business
Most businesses are very good at explaining what they do.
Ask an accountant, designer, consultant, videographer or lawyer what they sell, and you’ll usually get a clear description of their services.
But ask them what their customer is actually buying, and the answer becomes much harder.
That distinction matters.
Because if you define your business by the services you provide, you’ll naturally focus on improving those services. But if you understand the outcome your customer is really paying for, you can start asking much more interesting questions about your business model, customer experience, and where you create value.
It starts with one deceptively simple question:
What business are you actually in?
Your services are not necessarily your value
I was reminded of this recently while delivering a workshop.
I asked everyone in the room to turn to the person beside them and give their one-minute elevator pitch: who they were, what their business did, and what they sold.
As I walked around listening, I heard plenty of clear descriptions of services.
What I didn’t hear much of were outcomes.
That’s understandable. Services are tangible. They’re easy to describe.
But services describe what you deliver. They don’t necessarily explain why somebody pays you for it.
That’s the difference between outputs and outcomes.
Understanding that difference can change the way you think about your entire business.
What is the difference between an output and an outcome?
An output is the product or service you deliver.
An outcome is the change your customer expereinces as a result of buying it.
A customer might pay for a website, a financial plan, a strategy document, a video, or a consulting engagement. Those are outputs.
The more important question is:
What do they want to be different afterwards?
That’s where the real value usually sits.
And once you understand it, you have a much better lens through which to make decisions about your services, processes, customer experience and communications.
The Savannah Bananas: what are baseball fans actually buying?
I used the Savannah Bananas as an example during the workshop because they’ve taken this thinking to an extraordinary level.
The Bananas began as a local baseball team in Savannah, Georgia.
Rather than simply asking how they could create a better baseball team, they started with a more fundamental question:
What do people actually want when they attend a baseball game?
The obvious answer is baseball. But people weren’t simply buying baseball.
They were buying fun, entertainment, connection, participation, energy, value for their time, and an experience worth remembering and sharing. Baseball was the visible product — the output. The experience was the outcome.
That insight opened up a completely different set of possibilities.
Instead of asking how to improve the existing product, they could challenge the assumptions underpinning it.
Why should baseball games take so long?
Why should audiences remain passive?
Why should players be separated from fans?
Why should entertainment stop when play begins?
Which traditions genuinely improve the customer experience, and which have simply been preserved through habit?
Over time, those questions helped the Bananas create something fundamentally different: Banana Ball.
Customer value gives you a better decision-making lens
The important lesson from the Savannah Bananas isn’t that every business should try to become a disruptor.
It’s that understanding what your customer is actually buying changes the questions you can ask yourself.
Once the Bananas understood that the desired outcome was an entertaining, participatory and memorable experience, they had a simple lens for decision-making:
Does the decision we’re about to make improve the fan experience?
And we can all ask ourselves that same question, because that same principle can be applied to almost any business.
If you understand the outcome your customer wants, you can start asking:
Does our current process help create that outcome?
What gets in the customer’s way?
Which parts of our industry’s accepted model still serve them?
What could we add, remove or redesign to create more value?
Are we communicating the value we create, or simply promoting the services we sell?
Those questions move the conversation away from what do we make? and towards what are we trying to make happen?
Customer experience isn’t separate from the product
Another important lesson is that customer value isn’t created only through the core service.
The Savannah Bananas deliberately design the entire experience: before, during and after a game.
That means thinking about ticketing, arrival, interaction with players, entertainment, audience participation, the conclusion of the event, and even the stories people take away afterwards.
It points to a broader principle:
The experience isn’t what surrounds the product. The experience is the product.
For businesses, that means customer experience shouldn’t be treated as something that happens around the edges of delivery.
Instead, every interaction contributes to the outcome your customer experiences.
Innovation can also mean removing friction
We often think about innovation as adding something new: a new service, new technology, new features, new capabilities.
But sometimes the bigger opportunity is subtraction.
The Bananas asked what fans should no longer have to tolerate. They looked at long games, dead time, passive participation, inaccessible conventions, and distance between players and fans.
Then they removed or redesigned the things that worked against the experience they were trying to create.
That creates another useful question for business owners and leaders:
What does your industry make customers tolerate simply because that’s how it has always been done?
There may be more value in removing that friction than adding another feature.
Optimise, augment, or disrupt?
This thinking doesn’t automatically mean you need to reinvent your business.
I think there are three useful ways to think about change:
Optimise: Perform the accepted business model better.
Augment: Add, remove, or redesign something to create greater customer value.
Disrupt: Challenge the accepted model and create a fundamentally different way of delivering value.
Importantly, this isn’t a hierarchy of good, better and best. Disruption isn’t inherently more valuable than optimisation. The better question is:
What degree of change would create the greatest meaningful value for your customer — and can your business realistically and sustainably deliver it?
How we applied this thinking at The Content Engine
We’ve recently gone through this process ourselves.
For years, I would have described The Content Engine as a content production business. We created videos, podcasts, photography, animation and written content.
We still do.
But when we examined what clients were actually buying from us, we realised the content itself was rarely the starting point.
Usually, something valuable wasn’t being understood.
Our clients needed to take something complex and make it clear. They needed to understand where communication was breaking down, and what needed to happen as a result.
The content was the mechanism – the output.
Clarity was the immediate value – the outcome.
That changed our process.
Rather than assuming production should begin with whatever format has been requested, we start by diagnosing the communication gap and determining what actually needs to be solved.
We haven’t disrupted the communications industry.
We’ve augmented our existing model by getting clearer about the value our clients are really buying.
Five questions to ask about your own business
You don’t need to invent the next Banana Ball to apply the same thinking in your business.
Start with five questions:
Who is your actual buyer?
What outcome are they really buying from you?
Which assumptions in your industry are worth challenging?
What does your customer currently tolerate that creates unnecessary friction?
Should you optimise, augment, or fundamentally challenge your industry’s existing model?
The answer might lead to a completely new business model. It might lead to one meaningful change in your customer experience. Or it might confirm that the model you already have is fundamentally the right one.
All three are useful outcomes. Because the objective isn’t disruption for disruption’s sake.
It’s clarity.
Before you decide how to take your business to the next level, make sure you understand what business you’re actually in.