Using Case ROI™ to Determine Customer and Segment Value in the Business-to-Business Environment

As pricing has evolved as a specialty over the past 20 years, there has been increased focus on the concept of value – what it is, how to measure it, and why it is important. Value is important not only for setting prices but for establishing product and negotiating strategies and tactics. This chapter first discusses the importance of value in the price-setting process. Second, it frames how to define and measure value. Last, it explains how value tools can help salespeople in their negotiations process. It will review the application of these value measures in a business-to-business (B2B) environment and report on a technique of value measurement called Case ROI™. This measurement is particularly useful because it calculates the value of new products, technologies, and services at both the segment and the individual customer levels with a higher level of precision and relevance than other methods. It is based on a field-value-in-use technique that will be discussed in detail.