Customer value as a strategic approach to do a business is important.

Professor Art Weinstein explained in his book about customer value theory which is a valid conceptual framework for positioning a company through market orientation to design and deliver superior customer value for competitive advantage.

He told us that consumers are not just buyers, but must be seen as a strategic business partner. Therefore, we can treat consumers as co-creators of value.

Why customer value?

The business is very tight. The practices and strategies must respond and react to both controllable and uncontrollable changes.

The environment has changed dramatically, company must respond and dealing with this change.

The important factor to have a competitive advantage is how a company delivers on their value propositions.


This condition triggers a company develop and deliver customer values.

SQIP Approach

The ultimate value driver is meeting customer needs/wants.

The company can ask these questions:

- What do consumers really want?

- How do we meet their want/need?

- What do consumers really value?


Professor Art Weinstein, in his theory (superior customer value) explained  that consumers want more than just simple value. They want a company to surprise them delivering extra ordinary value to fulfill their needs and wants.

What is customer value?

Customer value is the ability of a company to develop and add value to its product or service (service a company offers to consumers and service aspects of its business).

Customer value is defined from consumers' perspective as trade-offs between benefits received from offers vs the sacrifices such as money, time to obtain the product, stress, and so on.

What is the four component of customer value (the essence of customer value)?

1. Service: intangible value

2. Quality: customers' perception of how well the company and its product/service

3. Image: customers' perception of the company they interact with

4. Price: the price you define for your product and that your customers are willing to pay

Each of above components contributes to consumers' perception of value. It also affects their level of satisfaction or dissatisfaction with product/service or business.

The value that consumers obtained comprises total experience of the customer regarding the company (its product/service), pre-purchase, purchase, and post-purchase, interaction between consumers and product, etc.

Superior customer value

A company now must deliver the value more than ever before to distinguish it from competitors.

There is no companies that survive without developing value for customers. Companies are driven by customer demands/needs/wants.

The superior customer value must be developed comprehensively and resulted from combination of service, quality, image, and price.

Weinstein (2012) said that the key to retention is high customer satisfaction  that come from delivering superior customer value.

High customers satisfaction make them stay loyal or become a loyal customer

Loyal customers usually talk favorably about the product (or company/business) or known as word of mouth marketing, less price sensitive, cost less to serve than obtain new customers. 

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This article is my summary and personal notes from marketing journal.
Source:

Atlantic Marketing Journal
Volume 2 No.1 Article 5
Title: The Strategic Importance of Customer Value
By: Donovan A. McFarlane, DeVry University
Year: 2013

You can download the complete information at:
http://digitalcommons.kennesaw.edu/amj/vol2/iss1/5