Unlocking Customer Value in Wealth Management

Episode 244: What defines a differentiated customer experience? It starts with a clear framework for measuring intangible value and making calculated trade-offs.

In this special tribute show, we revisit our 2016 conversation with Eric Almquist, a former partner at Bain & Company, on the Elements of Value. This framework transforms how businesses understand loyalty, brand equity, and growth. Inspired by Maslow's hierarchy of needs, Eric made value practical, categorizing 30 elements into functional, emotional, life-changing, and social impact levels.

His research connected the dots between delivering on multiple elements and revenue growth. Learn how successful industry leaders deliberately layer value over time and how even in B2B, solutions that ease complexity can offer emotional benefits, such as hope.

Eric was a pioneer in customer analytics and segmentation, his mantra being: What do customers truly value? His valuable insights continue to shape business thinking. Today we celebrate his legacy in customer experience and brand strategy.

Guest: Eric Almquist, former partner, Strategy & Marketing practice, Bain & Company

Host: Rob Markey, Partner, Bain & Company

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Want to get in touch? Send a note to host Rob Markey: https://www.robmarkey.com/contact-rob

Topics Covered:

• [00:01:00] Eric Almquist discusses the Elements of Value and why they were created to help managers better understand demand
• [00:02:00] Eric's contributions to customer analytics, segmentation, and experimental design
• [00:03:00] How the Elements of Value were first developed, inspired by questions about what customers truly value
• [00:04:00] The connection between the Elements of Value and Maslow's hierarchy of needs and why Maslow's model is hard to apply in business
• [00:05:00] The four levels of the Elements of Value: functional, emotional, life-changing, and social impact
• [00:06:00] The impact of delivering multiple elements of value on revenue growth and customer advocacy
• [00:07:00] The 2016 Harvard Business Review article and how the framework connects to Net Promoter Score℠
• [00:08:00] Unexpected insights from the research, including how B2B solutions can provide emotional value, such as hope
• [00:09:00] The evolution of the framework, from 16 to 36 elements over time
• [00:10:00] How value can persist across generations, such as in heirlooms and wealth preservation
• [00:11:00] The role of brand strategy and the caution against over-promising value in marketing
• [00:12:00] Closing remarks from Rob Markey, reflecting on Eric Almquist's impact and legacy

Time-stamped Notable Quotes:

• [00:01:00] "There's a fundamental asymmetry within management that it's easier to manage the cost side than it is the demand side, because the cost, you can see, you can quantify. It's much harder to know how to increase demand, and how to increase revenue. That asymmetry is what's motivated me to develop the elements of value."
• [00:04:00] "Maslow's hierarchy of needs was developed in the mid-20th century. So as we're drawing on something very old, when I talk to audiences, I'll ask them if they know Maslow's hierarchy of needs and all the hands go up, and then I ask them how many of you have used it to, say, improve a product or think of a new product, and the hands tend to go down. The reason is that it's pretty academic."
• [00:05:00] "We began to think about functional elements of value, emotional elements of value that could be life-changing. Following Maslow's hierarchy, the top of the pyramid, the highest level of motivation, was around altruism or charitable giving. We call that social impact."
• [00:07:00] "If you are delivering on zero elements of value by our threshold definition, revenue growth tends to be around negative 2%. If you're delivering on four or more elements of value, the average is 13%. Eight of the original 47 companies that we looked at were delivering on zero elements of value at our threshold. The truth is if you're delivering on zero elements of value for very long, you're probably going to be crushed by a competitor or be acquired, would be my guess."
• [00:09:00] "[The elements of value] really began as a thought experiment. I began thinking about all the work that I had done over all the decades, thinking about what I've heard in focus groups and interviews and observations and surveys. I began to realize value is not infinitely complex nor mysterious. There are actually things that you can point to that are appealing or not appealing."

Additional information on what was discussed in today's episode:

• HBR article, The Elements of Value, by Eric Almquist, John Senior, and Nicolas Bloch: https://hbr.org/2016/09/the-elements-of-value
• Eric's perspective on the elements of value: https://www.bain.com/insights/eric-almquist-managing-the-elements-of-value-video/
• Episode 117 of Customer Confidential with Eric, What Do B2B Customers Want?: https://baincompany.libsyn.com/ep-117-eric-almquist-what-do-b2b-customers-want
• Explore the B2C elements of value in more detail here: https://www.bain.com/insights/elements-of-value-interactive