Customer Perceived Value
Customer Perceived Value – A Literature Review
Introduction
The concept of value exists back from the days where people begun engaging in exchange activities, however, it was only recently when both academics and practitioners realised the importance of delivering superior value to customers in order to achieve competitive advantage (Ulaga and Chacour, 2001; Khalifa, 2004; Lindgreen and Wynstra, 2005; Hansen et al.,2008). In the following section, a literature review upon the issue of customer perceived value will be performed by looking at the key theories developed in an attempt to address this topic. Literature Review
There have been various different contributions when it comes down on defining customer perceived value. For example, some academics tend to look upon the issue of creating value from a functional point of view whereas some others prefer to focus mainly on the monetary value of the equation.
Nevertheless, despite the relative differences that exist within the various definitions one can identify common grounds between them such as the importance of competition, the multiple components of value and the subjectivity of value perceptions (Eggert and Ulaga, 2002).
Broadly speaking, customer perceived value is the difference between the total perceived benefits such as product, service, personnel and image values; and the total perceived costs such as monetary, time, energy and psychic costs (Lapierre, 2000; Kotler and Keller, 2006; McDougall and Levesque, 2000).
CPV=Total Benefits (product, service, personnel, image)Total Costs (monetary, time, energy, psychic)
The evolving literature on customer perceived value is concerned with theory and methods of
Introduction
The concept of value exists back from the days where people begun engaging in exchange activities, however, it was only recently when both academics and practitioners realised the importance of delivering superior value to customers in order to achieve competitive advantage (Ulaga and Chacour, 2001; Khalifa, 2004; Lindgreen and Wynstra, 2005; Hansen et al.,2008). In the following section, a literature review upon the issue of customer perceived value will be performed by looking at the key theories developed in an attempt to address this topic. Literature Review
There have been various different contributions when it comes down on defining customer perceived value. For example, some academics tend to look upon the issue of creating value from a functional point of view whereas some others prefer to focus mainly on the monetary value of the equation.
Nevertheless, despite the relative differences that exist within the various definitions one can identify common grounds between them such as the importance of competition, the multiple components of value and the subjectivity of value perceptions (Eggert and Ulaga, 2002).
Broadly speaking, customer perceived value is the difference between the total perceived benefits such as product, service, personnel and image values; and the total perceived costs such as monetary, time, energy and psychic costs (Lapierre, 2000; Kotler and Keller, 2006; McDougall and Levesque, 2000).
CPV=Total Benefits (product, service, personnel, image)Total Costs (monetary, time, energy, psychic)
The evolving literature on customer perceived value is concerned with theory and methods of
References: CIM, (2007), “Tomorrow’s word: Re-evaluating the role of marketing”, The Marketer Eggert, A Flint, D. J., Woodruff, R. B. and Gardial, S. F. (1997), “Customer Value Change in Industrial Marketing Relationships: A Call for New Strategies and Research”, Industrial Marketing Management, Vol. 26, pp. 163-175 Grönroos, C Groth, J. C. and Dye, R. T. (1999), “Service quality: perceived value, expectations, shortfalls and bonuses”, Managing Service Quality, Vol. 9, No. 4, pp. 274-285 Hansen, H., Samuelsen, B Heinonen, K. (2004), “Reconceptualizing customer perceived value: the value of time and place”, Managing Service Quality, Vol. 14, No. 2/3, pp. 205-215 Hollensen, S Jayawardhena, C. (2010), “The impact of service encounter quality in service evaluation: evidence from a business-to-business context”, Journal of Business & Industrial Marketing, Vol. .25, No. 5, pp. 338-348 Khalifa, A Kotler, P. and Keller, K. L. (2006), “Marketing Management”, 12th ed. New Jersey: Pearson Prentice Hall Lapierre, J Lindgreen, A. and Wynstra, F. (2005), “Value in business markets: What do we know? Where are we going?”, Industrial Marketing Management, Vol. 34, pp- 732-748 McDougall, G Ravald, A. and Grönroos, C. (1996), “The value concept and relationship marketing”, European Journal of Marketing, Vol. 30, No. 2, pp. 19-30 Ulaga, W Yu, H. and Fang, W. (2009), “Relative impacts from product quality, service quality, and experience quality on customer perceived value and intention to shop for the coffee shop market”, Total Quality Management, Vol. 20, No. 11, pp. 1273-1285