Tangible or Intangible Value?

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In this essay we will discuss the statement: “In a prosperous society, value is predominantly of an intangible nature”. Value is “the sum of the tangible and intangible benefits and costs to customers” (Kotler & Keller, 2012). The question is however if the tangible or intangible benefits and costs are influencing the value of a product the most. This essay will evince that value is mainly of tangible nature. According to the customer value triad theory by Earl Naumann, “value is a combination of quality, service and price” (Naumann, 1995). In this case quality could be defined as performance quality, the objective quality of a product (Kotler & Keller, 2012). A product with high performance quality, increases the value of a product. The value of a product is furthermore positively influenced by the service that is delivered (Kotler & Keller, 2012). The price however, can both positively and negatively influence the value of a product. A high price will in most cases decrease the value, but for some exclusive and luxury goods, a high price increases the value. The exclusivity, which is of intangible nature, is than one of the most important determinants of the value of the product. For most normal goods however, the objective quality is the prime determinant of the value. Although intangible benefits can be important in determining the value of a product, in most cases it is still the tangible benefits and costs, the objective quality and the price. Research on the consumer behavior of women in Taiwan, while purchasing cosmetics, has shown that the main value drivers differ per type of consumer and per lifestyle (Chiang & Yu, 2010). Whether it is the tangible or the intangible part of a product that predominantly determines the ... ... middle of paper ... ...rted by the research that was done in the Hsinchu area in Taiwan (Chiang & Yu, 2010). Intangible items influence the value, but tangible items determine it. Consequently, we reject the statement that in a prosperous society, value is predominantly of intangible nature. It is important, but not the main determinant of value. Works Cited Chiang, C.-T., & Yu, W.-C. (2010). Research of Female Consumer Behavior in Cosmetics Market Case Study of Female Consumers in Hsinchu Area Taiwan. iBusiness, 2, 348-353. Kotler, J., & Keller, K. (2012). A framework for marketing management. Essex: Pearson Education Ltd. Naumann, E. (1995). Creating Customer value: The Path to Sustainable Competitive Advantage. Cincinatti: Thomson Executive Press. Richards, K., & Jones, E. (2008). Customer relationship management: finding value drivers. Industrial Marketing Management, 37, 120-130.

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