Thoughts:

There was a time which required you to change, if you want to succeed in life. but today, it is not enough to change, but the rate of change will determine your level of success in life Prof. Bharat
Macmillan Publishers India Ltd. Chapter 4 / Slide 1

CHAPTER 4

Value The Basics

Macmillan Publishers India Ltd.

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Chapter 4: Value The Basics

At the end of this chapter, you should be able to:

State the meaning of Value in Marketing Understand the Concept of Customer Value Comprehend Initially Perceived Value & Finally Delivered Value State the Components of Customer Value State the Components of Customer Cost Understand that the Customer Decides What Value is Recognise that today Indian Consumers are increasingly voting for Value Understand that Value Delivery is no easy task it requires creativity, innovating ability and customer insights

Macmillan Publishers India Ltd.

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Chapter 4: Value The Basics

The Meaning of Value in Marketing

Benefits Translate into Value All buyers seek Value in all their purchases and they look for it in the form of benefits.

The Concept of Customer Value

Customer Value is the composite of tangible values as well as intangible values.

Customer Value, Customer Cost, and Customer Satisfaction

Initially Perceived Value and Finally Delivered Value

Initially Perceived Value Initially perceived value, the outcome of mental evaluations

Blend of qualitative and quantitative yardsticks.

Macmillan Publishers India Ltd. Chapter 4 / Slide 4

Customer Value (contd)

Chapter 4: Value The Basics

Finally Delivered Value Is the difference between the total value from owning & using the product and the total costs incurred in obtaining it. Challenge is to Fulfil Customers Initially Perceived Value Am I Getting My Moneys Worth?

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Chapter 4: Value The Basics

Components of Customer Value

Tangible Values Functional value

Intangible Values Social value

Economic value Convenience value Sensory/aesthetic value Service (people) value

Prestige/status value Sentiment value Belief value

The two categories not mutually exclusive; they overlap and blend Intangible values are equally vital as tangible ones A Consumers Profile Determines How He Perceives Value
Macmillan Publishers India Ltd. Chapter 4 / Slide 6

Chapter 4: Value The Basics

Components of Customer Cost

Customer cost also consists of tangible and intangible components Total of monetary cost plus psychic costs like time, energy, and other botherations. Value Delivery : Examples

Macmillan Publishers India Ltd.

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Chapter 4: Value The Basics

The Customer Decides What Value is; the Firms Job is to Deliver it

Design and create products/services that embody attributes which customers consider as value Customer analysis and Customer dialogue, the tools In some cases, the firm can be customer-driving

Macmillan Publishers India Ltd.

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Chapter 4: Value The Basics

Indian Consumers Now Increasingly Vote for Value

Paisa Vasool Approach Value Takes Precedence Even Over Brand Name

Nike, Reebok, and Adidas could not succeed in India on brand name alone

In Durables too, Value Becomes Vital for Indian Consumers

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Chapter 4: Value The Basics

Value Delivery is No Easy Task; It Requires Creativity, Innovating Ability and Customer Insights

Requires Creativity Innovation, Equally Essential Consumer Insights A Demanding Task

(Example: Nestle and Frito-Lay)

Value Delivery is the Essence in CRM Too

Customer Relationship has more to do with Value than with Relationship.

Martin Christopher, Adrian Payne and David Ballantyne, Relationship Marketing: Creating Stakeholder Value
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