Today, companies face their toughest competition ever. Moving from a product and sales philosophy to a holistic marketing philosophy, however gives them a better chance of outperforming the competition, and the cornerstone of a well conceived marketing orientation is stronger customer relationship. Consumers are more educated and informed than ever and they have the tools to verify company claims and seek out superior alternatives (Glen, 2004). How then do they ultimately make choices? Consumers tend to be value maximers, within the bound of search costs and limited knowledge, mobility and income. They estimate which offer will deliver the most perceived value and act on it. Whether the offer lives up to expectation or not affects consumer satisfaction and the probability that the customer will purchase the product again. Consumer value is a marketing and business concept that attempts to analyze the likelihood that the consumer will become a repeat consumer providing on going business for the firm. Businesses analyze consumer value in an attempt to solidify a consumer base, study product performance and to market the product more effectively.
PURPOSE OF CONSUMER VALUE
Using information about consumer value and the way consumers perceive a business and its product marketers can try to increase sales and encourage repeat business. Further, consumer value may be of use to business managers in determining the market structure. With more detailed knowledge of the characteristics of the market, businesses can work to expand product- marker boundaries or manipulate prices to increase profit. BUILDING CONSUMER VALUE AND SATISFACTION
Customer perceived value.
Customer perceived value (CPU) is the difference between the prospective customer’s evaluation of all the benefits and all the costs of an offering and the perceived alternatives. Total consumer value is the perceived momentary value of the bundle of economic, functional and psychological benefits consumers expect from a given market offering because of the products, services, personnel and image involved. Total consumer cost is the perceived bundle of cost that customers expect to incur in evaluating, obtaining, using and disposing of a given product, including monetary, time, energy and psychic costs. Customer perceived value is a useful framework that applies to many situations and yields rich insights. Here are its implications; * First, the marketer must asses the total consumer benefit and total consumer cost associated with each competitors offer connecting with consumers to know how his or her offer rates in the buyers mind (David and Charles, 2001). Consumers around the world continue their broad efforts to save money at the checkout counter but while low prices are important to shoppers, getting a good value for their money take priority. According to Nielson’s (2011) global online survey of more than 25,000 internet respondents across 51 countries, a good percentage of global online customers rated “good value” as the most influential reason to shop at a particular retailer over “low price” (58%). CUSTOMER VALUE PROPOSITION
A well defined and persuasive marketing statement related to a specific product or service that details the reason why a consumer would benefit from purchasing it is called a consumer value proposition. A business will typically use a consumer value proposition as part of its marketing strategy to consumers, rather than using it internally among staff, suppliers or distributors (web finance, 2013). A very useful tool for expressing your product is a consumer value proposition (CVP). A value proposition is a statement that addresses the key question; what does the product do? Who is it for? and most importantly, how it adds value for a consumer. Note that the CVP is more than just a simple list of features. The best CVPs are not only factual but emotional as well. The consumer value proposition is a very useful tool and...
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