"The difference between WTP and price is value for the customer....In value-based thinking, price is not a determining factor of WTP. We often use WTP and price interchangeably. But it is useful to keep them separate....If we want to understand why some companies are much more profitable than others, a useful starting point is to identify the reasons why the middle section of the value stick—the firm’s margins—is slim for some companies and fat for others....Value sticks illustrate that there are only two avenues for companies to create value: increase WTP or decrease WTS. Every strategic initiative needs to be evaluated against these two metrics. Unless an activity increases WTP or decreases WTS, it will not contribute to the firm’s competitive standing....Unless an initiative promises to increase WTP or decrease WTS, it is not worth pursuing....Companies compete for customers by creating superior customer delight. Many companies strive to be best in class. But having better quality and higher WTP is no guarantee for success. What matters is the difference between WTP and price—in other words, customer delight....In competition, more generous margins (and greater profitability) reflect an ability to create superior customer delight, greater employee satisfaction, and more generous supplier surplus....Strategists think in differences. Exceptional product quality and outstanding working conditions do not confer a lasting advantage if they can be matched easily by rival firms."
Trechos retirados de "Better, Simpler Strategy: A Value-Based Guide to Exceptional Performance"
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