Marketing, Customer Value, and the Link

The next P of marketing the paper shall address is price. Successful marketing includes marketing the right product to the right audience at the right price. If the marketing professional knows the target consumer very well, then he/she will be in a strong position to predict and assign a price to such a product. Knowing the target demographic for a new product must include financial and class information as people of different classes have different tastes, different needs, different aesthetic preferences, and different kinds of access to products. (Vargo & Lusch, 2004)

1. As a marketing consultant for a chain of hair salons, you have been asked to evaluate the kids’ market as a potential segment for the chain to target. Evaluate the kids’ segment against the four criteria for successful market segmentation.

Customer Value is ‘the performance characteristics, features and attributes, and any other aspects of goods and which customers are willing to give up resources’ (Robbins, Bergman, Stagg and Coulter, 2012). This broad definition highlights the fact that there are multiple aspects that contribute to create a sense of value within the customer.

Pricing is important when marketing a product. The determining factor for the pricing is the material, time to make, amount spent on marketing and promotion of the product. The goal in providing such a product that is moderately

An analysis is done on how the customer perceives the company’s products in comparison to the competitors’ products. Based on this understanding and the competitors’ prices the pricing is done.

Customer value can be defined as what the customer obtains or benefits from the purchase and use of a product versus what they pay for or sacrifice (Gale 1994; Heard 1993-94; Zeithaml 1988). There are four types of customer values, for instance the functional or instrumental value, experiential or hedonic value, symbolic or expressive value and cost or sacrifice value (Smith & Colgate, 2007).

It is how the product is introduced and represented to the potential customer which makes the product desirable.

The extent to which a product's perceived performance matches a buyer's expectations. Customer might be

Custom research pricing methods fall into two main approaches: (1) pricing the total product (pricing for a complete concept /product) and (2) pricing elements of a variable concept /product offering such as branding or features. This discussion will focus on pricing the total product. We are focusing on this because pricing elements (which is largely accomplished through conjoint trade-off models) tends to focus more on the features as either equal or superior to price and often needs to be used in conjunction with another method to fully understand the impact of price on brand success. Specific techniques that price the total product and which are covered in this paper are Gabor-Granger, price sensitivity measurement, monadic concept, brand-price trade-off, and simple discrete choice. Fuller profile discrete choice will be discussed briefly along with the simple discrete choice approach.

In fact, Price and promotion are two factors of the “4 P’s” discussed in marketing communication, which have severe effects on a customer’s outlook towards a retail environment with regards to their brand image (Kotler, 2010). Concerning price, there is the cost for the seller and for the customer (Profit +), and as for Promotion, the products benefit mainly to the customer (Eugene McCarthy). For example, you are only taking into consideration the

From this analysis, it is evident that price, while important, is not critical. While important, it is not consistent with the requirements of the customer. More importantly, we must consider

The automobile may cost $100,000, and if some customers perceive the particular price to be reasonable price for the automobile, they will purchase it based on their perception and not because of the fact that marketers set the price of the automobile as $100,000. Same customer may feel that $30,000 for different automobile is too expensive even though he or she felt that $100,000 for the automobile was reasonable for them because they perceive each products differently. Kotler and Keller (2012) also mentioned that customer are less sensitive to price of the product when they believe that 1) there are not too many similar products in the market that can replace the quality of the given product; 2) the high price of the product can be justified; 3) stated price of the product is just a small cost of obtaining unique product for the life time.

In the past, the concept of consumer perception on value has been utilized to analyze the decision making of consumers in many phases. The consumers will significance the product from many internal and external factors comparing with what he has to sacrifice. If the perceived value of the product exceeds what he has to give up, then he will choose to buy the product.

It is so important for a company to decide what type of approach they want to take when they are marketing their product/services. It is first important to understand the different approaches that make up the 4-P approach to marketing versus the value approach. When using the 4-P style the company will most likely be concerned with the price, product, promotion, and place. The price will be a major focus point because it is important that you can compete with any competition that may be selling the same type of product you are offering. Likewise, it is important to know whether if in the future a price hike may be needed, will your product survive the inflation, or will customers choose a different brand. When thinking of promoting your product, where is the best venue is going to be the key question. Is the product geared towards teens/young adult or middle aged individuals are common questions? If it is for teens and younger adults where do they like to spend their time? Areas such as skate parks, movie theaters, or advertising on television during programs geared towards this age range would be appropriate venues. Alternately advertising for the middle aged demographic could be during sporting events such as hockey or football, or places like popular restaurants. The product aspect of the 4-P approach deals with the physical product or service you are providing. This is a similar aspect for both companies that use 4-P style and also with companies that take the

Quite often, consumers purchase goods and services based on their perceived need. Upon making the decision that a need is present and a solution is available consumers are more equipped to react to that need. Although previously perceived that consumers will normally accept prices as presented by suppliers that remains to not be the case. Consumers assess and process prices based on past purchases and other psychological process they went through previously such as persuasive marketing strategies, accessibility of the goods or services and possibly information gathered from prior purchasers of a product. There are countless options that are available to consumers. Consumers are then faced with the choice of choosing the product that best fulfills their need at that given point. Consumers who are knowledgeable regarding prices will be aware of the approximated price for products (Zhao, Zhao & Deng, 2015).