Value Perceptions Among Customers

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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.

Please discuss value perception of customers from your professional experience.

© 2014 by Daryl D. Green

 

Customer Value Differences

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Companies must focus on value for customers. However, all customers are not the same. Globalization has created all types of problems for businesses.  One of the issues is how to stay ahead of the competition by exploring new markets while keeping the same customer base.  This action is not easy.

Mark Johnston and Greg Marshall, authors of Relationship Selling, maintain that customers expect and deserve consistency in the way an organization’s value-added message is put forth. [1]

Being strategic conscious about these business relationships is not simple.  Marketing expert Ken 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.

These marketing problems are worthy of the most decorated scientists. In fact, the right value proposition is critical because all customers are not created the same. When organizations place value creation as a high priority, organizations will beat their competition because they will deploy capital better and develop internal talent better.[2]

Customer expectations and customer needs are often different. Management expert Ray Miller further suggests a “strategic trap” for businesses seeking to meet customer expectations. Delivering below expectations is obviously bad.  However, simply satisfying customers will not guarantee customer loyalty either because they are getting nothing more or less than they expect.

 https://www.youtube.com/watch?v=d7vwhHLmdWI

Furthermore, some businesses get caught up being efficient in developing cookie cutter solutions for the masses. Yet, they overlook that value seeking customers are looking for products and services that solve their specific needs.

Consequently, employees should be motivated to provide value for customers if the businesses want to be successful.  In fact, this reality involves being compensated fairly, being treated with respect, and being given meaningful work. Finally, companies must understand that customer value expectations are often different. Therefore, businesses that  manage customer expectations effectively will possess a distinctive advantage in the market.

Please discuss your professional experience with customer value differences.

© 2013 by Daryl D. Green

 


[1] Relationship Selling by Mark Johnston and Greg Marshall

[2] Put Value First by Kevin Favaro