Customer-perceived value
A popular theory used in branding and marketing is known as customer-perceived value. This theory points out the successes of a product and is largely founded on whether or not customers believe it can satisfy their requirements. This process also emphasizes that when a company develops its brand and markets its products, it’s the customers who ultimately decide how they will understand and react to marketing messages. Companies spend a significant amount of time researching the market to get an overall picture of how consumers think and feel. A product is purchased by a customer if he believes that he will get more value from the product than what he pays and that other products will not have more value. The customer’s
The benefits from a product offering is the monetary value of the economic, functional, psychological, and social benefits a customer expects from the product. (Kotler & Keller, 2007) The total cost is the monetary worth a consumer may incur when evaluating, owning, using, and during product disposal. In other words, the total cost acquired during the life cycle of the product from evaluating to product disposal is the supposed cost of the product. Thus, the customer perceived value is the difference between the cost he will incur and the benefits the customer would gain from owning the product. The marketer’s objective is to take full advantage of the customer perceived value by increasing social, functional, psychological, and economic value and in turn decreasing the costs. One main challenge in introducing a value perception with consumers exists when a brand or product does not stand out in comparison to its competition. Distinction from other brands is a significant marketing emphasis. Additionally, if a company does not use market research, or if they obtain incorrect market research, they run the risk of making false expectations regarding what communications will affect
They relate to the brand attributes and find an emotional connection with that brand. The marketers want to create a loyal brand community among existing as well as prospective customers. The creation of loyal brand community allows the marketers to strengthen the sense of loyalty in a cost effective manner, and communicate the message to the existing and potential customers more effectively. (Kotler & Keller, 2007) A brand backed by a loyal brand community can compete with other very strong brands and still survive. For example, the open source programs are able to compete with products from large businesses because the open source programs are able to create loyal brand community. Mozilla, an open source browser, has very large loyal brand community. There are approximately 10,000 programmers who contribute to its open source code. Because of its large loyal brand community, Mozilla is able to compete with Microsoft’s Internet Explorer and Google’s Chrome browsers. The loyal brand community members show a very high level of brand loyalty which allows a large loyal brand community to make even a small brand very
Companies realize what people need and they take it as sources to produce commodities. However, companies which have famous brands try to get people’s attention by developing their products. Because there are several options available of commodities, people might be in a dilemma to choose what product they looking for. In fact, that dilemma is not real, it is just what people want. That is what Steve McKevitt claims in his article “Everything Now”. When people go shopping there are limitless choices of one product made by different companies, all choices of this product basically do the same thing, but what makes them different is the brand’s name. Companies with brands are trying to get their consumers by presenting their commodities in ways which let people feel impressed, and that are some things they need to buy. This is what Anne Norton discussed in her article “The Signs of Shopping”. People are often deceived by some famous brands, which they will buy as useless commodities to feel they are distinctive.
We live in a new generation of buyers. Consumers used to be taught how products can help them fulfill their needs or reach goals and the benefits of the products were described to provide reasons for buying. Now consumers only buy if they identify therefore positive attitudes towards a brand of product should be taken in consideration to express a brands values as social groups influence consumers by sharing their own experiences and connections in their community. The value of a great shopping experience is rather found in the moment of consumption, rather that in the purchase of a product. Brands should understand that people do not buy only the products, they buy the services that the products provide too.
Customer Value is a very important factor to all businesses let along business that supply products or services to the public. Value is relative to each individual customer but many researchers have found a simple way of defining customer value. Customer value equal the result produced for the customer plus process quality divided by the price to the customer plus the costs of acquiring the product (McMurrian & Matulich, 2016). The customer must purchase the product or service and experience it for the company to be able to benefit from the feedback. The four mechanisms within customer value, the results, process quality, price and customer access cost, are all very important for a company to understand in order to fully understand customer value.
This argument is supported by Solomon (1992) with him discovering that purchase decision that is based on loyalty might become a habit which leads to brand equity. On the other hand, Aaker (1991) described brand loyalty as consumer’s mentality toward a brand that drives them to consistently purchase the same brand. As per Yoo (2000), brand loyalty has the ability to affect consumer choice to buy a same product or brand and cease to switch to other brands. Subsequently, Yoo (2000) reasoned out that brand loyalty is the root for brand’s value. Aaker (1991) additionally contended that brand loyalty is a fundamental component used to assess brand’s value due to the fact that brand loyalty can increase profitability. The consumers who are loyal to a brand will not assess the brand, instead they simply purchase it unquestionably based on their experiences with the brand (Sidek, Yee, and yahyah, 2008). The loyal customers bring advantages to a firm by cutting down costs, encouraging easier strategies implementation, providing time for responding to competitions, creating a barrier to entry, increasing sales volume, protecting firm against detrimental pricing and to retain rather than seek for customers (Aaker 1991; Rundle and Bennet, 2001). Loyal customers are also less incline to change to another brand simply because of pricing factor and they purchase more frequently compared to their non-loyal counterparts (Bowen and Shoemaker,
...chase the product again, and are also inclined to say good things about the brand to others; the opposite applies to customers who are dissatisfied with the products. Value also affects post purchase behaviour, as research shows that 56 percent of Irish consumers agree, that if they purchase something that was not on sale, they feel like they have overpaid (Board Bia, 2012).
[a] company may have a unique vision, a superior product, strong management and an efficient distribution system – yet if it is not able to convey the core benefits of the brand to its target audience it will ultimately fail. [5]
The customer value proposition is arguably the most important tool in the product marketer’s toolset. It is the foundation for understanding how the product will realistically be valued by the target user. Unlike a benefits statement, a customer value proposition is more balanced. It certainly includes the advantages a target user would experience. But to these benefits it adds the tension of disadvantages and parity experiences. The sum of all of these experiences provides a much more accurate assessment of the product in its marketplace. In the absence of customer value propositions, companies are walking blindly in the marketplace. Businesses underplay the fact that their target users have other options. They ignore that fact that their product has deficiencies some of which may significantly hamper their efforts in the marketplace. The customer value proposition is the keystone for effective product marketing activities. It brings together customer intelligence, competitive insight, and product valuation. It delivers a concise, supportable statement of the product’s value. It quantifies how that value is realized based on all of the target user’s likely product experiences. The customer value proposition provides a focused approach to understanding the target user in the context of your
Companies use a collection of brand equities to represent their products in the market (Voolnes, 2012). Brand equity refers to the commercial value that is derived from the perception of consumers on any given brand name of particular products in the market as opposed to the product itself. Ataman (2003) notes that the effect to the consumer is in the brand name and not the product itself. Companies use logos, trademarks and a collection of other symbols to present this information to the customers. The use of these symbols is meant to try and capture the customer mindset so that they can be thinking about the company products at all times through the items they possess at home (Estes, Gibbert, Guest, & Mazursk, 2012). This can well be explained by use of the customer-based brand equity model that brings together the requirements for a publicly renowned brand in the market.
Marketers assert to develop branding and packaging strategies that signify the brand’s products in a way that establishes lasting impressions in consumers’ thoughts. Because brands distinguish the many product offerings in the marketplace, brands help consumers choose between product offerings. When branding and packaging strategies clearly illustrate worthy product expectations, and products remain true to branding messages, positive consumer perceptions ensue, and brand value is strengthened.
Marketing and branding, two of the most common used words in the contemporary world, is closely linked to each other without doubts, but the importance of branding to successful marketing is enquired to measure in term of the question. In fact, various people have different ideas on marketing and branding. For most of people, or customers, the two are normally combined in their minds or even equal to each other. For example, people could raise Apple as the answer for both questions of "what is good branding" and "what is successful marketing". In fact, they are two separate topics on academic, and branding is just one of the numerous marketing activities apparently. However, the perception of consumers might be a good guide to answer the question.
A brand identifies a seller’s product from a competitor’s product. There are three main purposes for branding product identification, which is the most important purpose, repeat sales, and new-product sales. Branding has a lot of terms that marketers use there is brand equity, global brand, and brand loyalty. Marketers also have different brand strategies that they use for different products or customers. It all depends on the consumer for them to decide which strategy they will use. The different strategies are generic products, manufacturer’s brands, private brands, individual brands, family brands, and co-branding. The branding purposes and the branding strategy make up the importance of branding.
Marketing professionals create, manage and/or enhance brands in order to create or bolster demand for the product. A successful marketing plan will help assure that consumers look beyond just the price or function of a product when making a purchasing decision, in part, a well planned marketing effort will create a “feel good” association about the product the consumer is about to purchase (Petty) A key part of a career in marketing is to understand the needs, preferences, and constraints that define the target group of consumers or the market niche corresponding to the brand. This is done by market research. This is accomplished through market research, essentially using survey techniques, statistics, psychology and social understanding to help gather information on what consumers want and/or need, and then designing products, or services, to hopefully meet ...
Most consumers save up to buy good products. A brand can only rationalize a price premium if it is view by its consumers to be profoundly different from the related products. Lack of value is what makes a market full of goods where people have no emotional connect with their buying. It is significant for the brand to recognize its consumers and their anticipations before it can provide the price premium and foster brand loyalty. A premium customer is the one who paid for higher price and then is justified in expecting top-notch product quality. To sustain that feeling of being meaningfully different from others is the challenge for premium
Value can mean different things to different people; it is measured by a product’s performance and by the elements it is made up of which customers are prepared to pay for. (Hanson et al, 2008)
Perception in marketing is critical, for what consumers believe about a product is in equal importance to what the product really carries in relation to performance. And so marketers’ most important job is to control their products’ perception in order to produce a positive image in the thoughts of consumers. In addition, when they consider perception, companies must look for ways to get consumers to trust their products. And when marketers form the perception in people’s thoughts that they truly want to own this product, they can easily get people to come to their stores and buy what they