Introduction: Quantifying and documenting value in business markets

Customer value is the sum of (a) the price of the customer’s best available alternative and (b) the subjective value of all the dierentiating features that distinguish the supplier’s own oering from the customer’s best available alternative (Nagle and Holden 2002). Customer value is thus the quantied sum of the customer-specic benets accruing to purchasers as a result of purchasing the oering. This sum is the maximum price that rational buyers will be prepared to pay. The price dierence between the supplier’s own oering and the customer’s best available alternative is then related to the dierence in value between the two oerings (see Figure 1.1).