value concept

The Value Concept : 

The Value Concept 1

The Agenda : 

The Agenda The concept of needs, wants and demands Understanding the difference between public, customer and consumer The concept of value and value equation The different types of environment and its effect on value The value cycle and its different phases 2

The concept of Needs, Wants and Demand : 

The concept of Needs, Wants and Demand Needs: needs are the basic human requirements. Wants: when needs are directed to specific objects then they are called wants Demand: when wants for specific products are backed by ability to pay then they are called demands 3

Different types of needs : 

Different types of needs Stated needs Real needs Unstated needs Delight needs Secret needs 4

The Public, Customers and Consumers : 

The Public, Customers and Consumers The public is the general body of people that requires certain products to fulfill their needs, wants and demands. Customer is the one who is looking out for some specific product to fulfill his specific want. Consumer is the one who uses or consumes the product and is the one who creates demand for specific products. Note: consumer is always a customer but it is not necessary that customer is a consumer. 5

The concept of value in marketing : 

The concept of value in marketing Value concept is defined as ratio between what customer gets and what he sacrifices to get Value = benefits /cost Benefits include both the functional benefits as well as the emotional benefits. Costs include monetary cost, time cost, energy cost, psychic costs The buyer chooses between different on the basis of which is perceived to deliver the most value. 6

The Different combination of benefits and cost : 

The Different combination of benefits and cost Raise benefits Reduce costs Raise benefits and reduce cost Raise benefits by more than the raise in cost Lower benefits by less than the reduction in cost. 7

Types of macro environment and its effect on value process : 

Types of macro environment and its effect on value process Demographic environment Economic environment Socio-cultural environment Natural environment 8

Value process : 

Value process The process marketing itself starts with value creation and value delivery The customers search for all the possible options and then finally chooses the best option among the available options. When the actual satisfaction is same as to expected satisfaction then the marketer is said to be successful in balancing cost and value simultaneously. Value creating and value delivery ultimately leads to satisfaction to the customers 9

Developing “value” for customers : 

Developing “value” for customers Any organization requires to develop a long lasting value process while ensuring the profit making objective of the organization. The four steps involved in the process are: Value selection Value creation/ value delivery Value offer communication Value enhancement 10

Value selection : 

Value selection Because value flows within and across markets that are themselves dynamic and competitive. The company requires to consider three aspects while selecting a particular value. Cognitive space of the customer Competency space of the organization Collaborator’s resource space 11

Value creation/Value delivery : 

Value creation/Value delivery To exploit a value opportunity the company needs value creation skills. Marketers needs to Identify the possible benefits that can be actually offered to the customers Create new values or offerings so that the associated needs of the customers are fulfilled In the creation and the delivery process the complete organization is involved While delivering the values it is most important that the promised value should be the actual value because any failure will result in customer loss and the customer will be gone forever. 12

Value offer communication : 

Value offer communication The offered value needs to be communicated to the customer so that they enjoy the maximum benefits. It needs to checked whether the expected value offering should match the customers’ requirements and how it works out to be the best among all competing offers 13

Value enhancement : 

Value enhancement Value providing process is an ongoing process and the company needs to check from time to time the value that was offered is still in demand or the customer needs have changed Customer likes and preferences keep on changing and the company has to look into narrowing the product-benefit gap, while keep making new and better offers to stay ahead in competition in value rankings. 14