Customer Value Perception

group problem-solvers

Organizations should think strategically when creating value perceptions of their products or services.  In fact, they should seek to establish a formal tiered system where possible. Strategic leaders have a long view on value creation. 

Strategic thinking is defined as ‘the generation and application of business insights on a continual basis to achieve competitive advantage.’ In fact, strategic thinking focuses on value creation by enabling a provocative and creative dialogue among people who can affect a company’s direction. 

Marketing expert Ken Favaro maintains that putting value creation first gives businesses two advantages over their competition in driving for profitable and sustainable growth: the first is capital and the second is talent. In fact, he argued that successful value creators never suffer from capital shortage. 

Yet, this process shouldn’t be done in a vacuum. Customers and all members of the supply chain should provide input so that the expectations are clear. Businesses that pay more would get more benefits (i.e. certain perks, discounts, etc.). Therefore, the value proposition would be enhanced. 

However, being strategically conscious about these business relationships isn’t simple.  Value must be understood and sought out.  Value is viewed as the perceived experience and worth gained from a product or service.  

Organizations should make their product clear to customers; some businesses need to introduce a tiered system, based on value-added services.  For example, if I want cheap fast food, I go to McDonalds.

Therefore, my expectations are lower than going to a five star restaurant.  Customers are very understanding when the seller’s value proposition is clear.

Favaro further suggests that putting value creation consistently first requires leadership skills, discipline, and perseverance. He further challenged organizations to demand higher standards from managers who would jeopardize these business relationships.

Mark Johnston and Greg Marshall, authors of Relationship Selling, discuss that perceived value is in the eyes of the customer and varies.  They further argued that customers expect and deserve consistency in the way an organization’s value-added message is put forth.  Therefore, sales professionals’ biggest challenge is selling value. 

Discuss the concept of custom value perception from your own professional experience.


© 2013 by Daryl D. Green


6 thoughts on “Customer Value Perception

  1. Customers hold all the cards when it comes to value perception. Since people are different, one customer may realize the value in a certain brand while other customers may not. Companies really have to put forth an effort to make sure that their customers see the value in their products, services, and brands.

    According to Martin Zwilling, Contributor for, brands are people first and customers are people too, so customers tend to take their relationship with a brand personally. Businesses need to realize that brand perception is becoming more and more driven by their relationships with customers, as well as feedback from other customer brand relationships. Today’s business market exists in the renaissance of relationships. So perception is reality and businesses can no longer hide behind their brand (Zwilling, 2013).

    Source: Zwilling, M. (2013, November 8). Customer Relationships Now Drive Brand Perceptions. Retrieved from

  2. Most successful companies know their vale proposition. Which in turn, most unsuccessful companies are confused about what is their value proposition. A current example that I believe demonstrates a company that is struggling with their value proposition is Ruby Tuesday restaurants. They tried to move from moderate on the go dinning concept to a higher class dining concept. This change in brand repositioning has ultimately lead to the change in value proposition. This has been inconsistent for them and has resulted in large problems for them. “In the past month, several analysts and a bond-rating firm lowered ratings on Ruby Tuesday after it reported a net loss of $22.2 million during its Sept. 3-ended first fiscal quarter, driven by same-store sales declines of 11.4 percent at company-owned restaurants and an 8.4 percent drop-off at domestic franchised restaurants” (Ruggles, 2013)

    Ruggles, R. (2013, November 21). Ruby Tuesday cuts 50 corporate jobs. Nation’s Restaurant News, Retrieved from

  3. Customer value perception is key in making a sale. Customers assign value to goods or services produced by a Company. If a customer perceives that the goods or service offered is not in line with the price they won’t buy them. However as the seller you want to get the most out of you good or service so you don’t want to under value your product or service. Working in manufacturing has taught me that each sale is different and flexibility is key to always getting the correct customer perceived value so that a sale is made but also the most money is made. I have seen customers request reductions in quality or features in order to get a cheaper price. This an example of flexibility if you’re not flexible in your business it will be hard to expand past your current market share because your customer perceived value will not be to their liking.
    Lapierre, J. (2000). Customer-perceived value in industrial contexts. Informally published manuscript, École Polytechnique de Montréal, Québec, Canada. , Available from Emerald. Retrieved from

  4. Customer’s perceived value of a product is not always associated with advertising or what a firm wants someone to think of their product. It’s mostly about experience. For example, referring back to the McDonalds hamburger reference, McDonalds wanted their image to be the affordable burger so they would be able to sell hamburgers whether they really tasted that great or not. They wanted the customers experience to be that they went to a McDonalds and bought 5 burgers for 5 dollars, not that it was one of the best tasting burgers they had ever had. They used the customers perceived value of quick burgers for low cost, while competition tries to create better tasting burgers, so that there are more options for customers. Johnathan Garshick writes about value proposition in customer perceived value. [1] “The value proposition compares the benefits customers gain from a company’s product relative to the price they must pay for that product” (Garshwick, 2012). From my experience, it is important to create a perceived value through advertising but even more important to create it through customer experience.

    [1] Garshick, J. (2012, March 05). Customer perceived value. Retrieved from

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s