Customer Needs
Customer needs are the foundational basis for customer value. If you need something, it has value to you. For example, a customer who needs curtains that look bright and cheery but totally block out the sun in the morning.Customer Preferences
Customer preferences are likes and dislikes that influence customer choices and satisfaction. For example, a customer who prefers curtains made of organic cotton as opposed to synthetic materials. A customer may place a high value on a product that suits both their needs and preferences.Customer Perceptions
Value only exists as it is perceived by customers. As such, marketing efforts that build positive perceptions of brand image, reputation, quality and customer experience can increase customer value. For example, two curtains may fulfill the same need but one may be perceived as a luxury item and the other as cheap.Value vs Price
Value is the worth of a product or service to a customer based on their needs, preferences and perceptions. Price is the actual cost to obtain the product or service in a market. Generally speaking, customers will only buy if they believe that value is greater than or equal to price. A firm that offers far greater value than price can expect high sales volumes.Customer Expectations
Before purchase, a customer estimates value based on information such as marketing, product reviews and word of mouth. A customer who makes a purchase does so with a set of expectations. When value falls short of expectations, the customer will be dissatisfied and may share their negative experience with others.Customer Value Analysis
Customer value analysis is research designed to model and measure the value of your products and services. This may be benchmarked against the value offered by the competition.Customer Value Management
Customer value management is the repeated process of measuring your value to customers to identify strengths, weaknesses, opportunities and threats in your markets. This can be used to drive product development, branding, promotion, distribution and sales.Customer Value Proposition
A customer value proposition is a marketing message that pitches the value of a product or service to the customer. For consumer goods, this may highlight things such as usefulness, convenience, comfort, quality, performance, social status and customer experience. For business goods, a customer value proposition may pitch return on investment and competitive advantage.| Overview: Customer Value | ||
Type | ||
Definition (1) | The worth, importance and utility of a product, service or experience to the customer. | |
Definition (2) | The worth of a product or service to a customer based on their needs, preferences and perceptions. | |
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