Branded Utilities are more than just extended value, they might represent a whole new mindset when it comes to business models. We are now met with an interesting opportunity: To design utilities in order to extend the customer experience or to create A NEW SUBSCRIBER EXPERIENCE.
Corporations’ need to increase the value of a customer is often met with an effort to expand the customer sideways from the first product or service to other “relevant” offerings within its range.
The challenge being that “relevant” for the company isn’t necessarily relevant to the customer. So there is a continuous investment in marketing new needs and new wants in order to generate more value.
As we are moving into branded utilities and digital extensions of our analogue products, we are given the opportunity to move away from this never ending cycle of “marketing from scratch” (where the existing relationship with the customer gives us the permissions to talk to them, but the marketing needs to start over with every new product). And instead start discovering, designing and adding extensions to the product they’ve already purchased.
Think of it this way: In a customer model a hardware manufacturer works his but of to convince customers that he has a worth while product. But, as they purchase the product their want/need cycle needs to start from the beginning again selling you the next product. With a subscriber model on the other hand the manufacturer sells customers a hardware product with a utilities universe attached to it. The first sale is the only sale. The manufacturer has just given the customer a reason to pay them in monthly increments, and the focus shifts from artificially creating new needs (customer model) to understanding and expanding the value “universe” of the product they’ve just sold (subscriber model).
The whole concept of “a customer” might be obsolete for some companies and some products… To find out we need to ask ourselves, are we better of with subscribers? And does our product(s) belong to (a) situation(s) where the subscriber model is sustainable?
UDATE 2: And Mark as well, adding it to the larger context of value creation in the interface between the company and the participant. link: Membership & Service.