What Is Price Perception?

Customer perceived value is the subjective evaluation of the effectiveness of a product or service after the customer perceives the benefit of the product or service and subtracts the cost it paid to obtain the product or service. It reflects the customer's specific perception of the value of the product or service, thereby distinguishing it from the objective value of the product or service in the general sense. Customer perceived value is considered to be the result of subjective perception of the customer's assigned value. ^[1]

Customer perceived value

Customer perceived value is the subjective evaluation of the effectiveness of a product or service after the customer perceives the benefit of the product or service and subtracts the cost it paid to obtain the product or service. It reflects the customer's specific perception of the value of the product or service, thereby distinguishing it from the objective value of the product or service in the general sense. Customer perceived value is considered to be the result of subjective perception of the customer's assigned value. ^[1]

Customer Perceived Value

People don't buy things but their expectations. Consumers hope to achieve a certain

The core of customer perceived value is the trade-off between perceived benefits (Perceived Benefits) and perceived pay (Perceived Sacrifices). This concept has two meanings: first, value is personalized, and varies from person to person; different customers perceive the same value for the same product or service; second, value represents a utility (benefit) The trade-off between cost and cost is that the customer will make a purchase decision based on the value they feel, rather than just a single factor.

The conclusions of the Semolton study

(1) The income component of value includes significant internal characteristics, external characteristics, perceived quality, and other related high-level abstract concepts. Although many customers regard product quality (internal characteristics) as the main part of value gains, the overall measurement of value gains still includes external features such as packaging, color, and the higher level of abstraction such as the reputation or convenience of the product or enterprise interest. Moreover, the internal attributes of the product itself may not be directly related to the value perceived by the customer. Instead, they are often reflected through the external characteristics of the product or even the abstract benefits perceived by the individual customer.

(2) The cost of perceived value includes monetary and non-monetary costs. Customers pay money and other resources (such as time, effort, effort) to obtain a product or service. For some customers with a high degree of price perception, monetary expenditure is a key factor. Reducing the expenditure on money is to increase the perceived value; for those customers who have a low degree of price perception, reduce time and energy expenditure. Increased perceived value.

(3) The external characteristic is a "value signal", which can to some extent replace the costly trade-offs between customers and revenue. In assessing the value of a product, the customer's

Since the 1970s, competition at the customer level has continued to evolve. From product-centricity and focus on product quality, to "customer-oriented", striving for customer satisfaction and loyalty, until the 1990s the concept of customer perceived value was proposed. Since the 1990s, research on customer perceived value has increasingly become the focus of attention of foreign scholars and entrepreneurs. This is the reasonable and inevitable result of enterprises' continuous pursuit of competitive advantage. In his book Competitive Advantage, Michael Porter points out that competitive advantage ultimately comes from the value that companies can create for customers. Woodruff (1997) also pointed out: "Customer perceived value is the next source of competitive advantage." The ability of a company to provide superior value to customers is considered one of the most successful competitive strategies of the 1990s. How to convert resources to customer perceived value to the greatest extent and effectively will be the basic point for enterprises to build core competitiveness. The customer-perceived value theory not only brings new progress to corporate marketing, but also provides new ideas and methods for the construction of core competitiveness. Therefore, providing customers with excellent customer perceived value is the root of the company's competitive advantage. Research on the cultivation of enterprise core competitiveness based on customer perceived value.

Operations on customer perceived value

1. Value exploration: Enterprises should cultivate a value-based corporate culture, and use the concept of relationship marketing to analyze, understand and understand the value that customers need.

2. Value structure: Enterprises should first establish the positioning of service brands, and use the results of customer questionnaires to evaluate what value is the theme before establishing and pricing the services or products provided by the enterprise.

3. Communication value: The service brand should communicate and educate customers, strategic partners, internal employees and the public for the values it has established.

4. Organization and training to deliver value: Enterprises can creatively design different roles for each employee, let them jointly build value, manage and market operations, and participate in the brand value chain, and companies can provide training to equip all participants To ensure they have the ability to deliver value to customers.

5. To improve the perceived value of customers by managing their efforts, customers will pay less effort and physical strength, and will be able to consume in a more comfortable manner, both psychologically and physically.

6. Enterprises should try their best to maintain the original customers, partners and employees to ensure that the transmission of value is more economical and productive.

Cultivating customer perceived value

Cultivating the core competitiveness of an enterprise based on customer value is to analyze and predict the expected value of the customer and the environment to integrate internal and external resources of the enterprise, provide customers with the expected value, and create an industrial organization and management form for the future market. To cultivate the core competitiveness of an enterprise based on customer value, the first step is to identify and understand the expected value of customers in the target market. By cultivating the company's industrial insight, beyond existing products and markets, find value areas that customers have always valued, and build superior skills in these areas. Therefore, the construction of the core competitiveness of an enterprise is a management process of review, analysis, discovery and innovation.

1.Analyze the situation of competitors

The core competitiveness of enterprises in the market essentially provides higher customer perceived value than competitors. Customer perceived value competition is the essence and basic platform of competition between enterprises. Because the significance of the existence of an enterprise lies in satisfying the needs of customers, or the enterprise can be regarded as a customer value creation system; the end result of enterprise output is the perceived value of the customers provided by the enterprise market; and customers choose based on the size of value perception Buy market offerings from the best suppliers. By studying competitors, understanding the characteristics of this industry, and understanding the possible customer subset of the company's existing products and services, accurate market positioning is achieved.

2. Research and identify the perceived value of target customers, find out the value areas that customers are most concerned about

According to empirical research by Wolfgang ULaga and others, the drivers of customer value can be divided into three categories: product-related characteristics, such as product consistency, product characteristics, product range, and ease of use; service-related characteristics, such as supply reliability Related to agility, technical support, quick response, product innovation, technical information; promotion-related characteristics, such as image, personal relationship, company reliability, public relations, upstream integration, etc. In the survey of customers, we found that among the driving factors of customer value, the active role of quality is far greater than the driving force of price. The former is 63.3% and the latter is 36.7% (that is, in the industrial product market, Customers value quality more, while price sensitivity is lower). Among the specific elements that make up product quality, product consistency has the strongest driving force at 19.8%, followed by the product's technical characteristics, ease of use, and range of finished products, which are 18.4%, 4.9%, and 3.0%; Among the service-related characteristics, the speed and reliability of delivery have the strongest driving effect, at 7.8%, followed by technical support and application, rapid service and response, product innovation and technical information provision, indicating its driving capability The importance of the company is 6.8%, 6.5%, 3.7%, and 2.3%. Among the promotion-related factors, the company's reliability-driven ability is the strongest, with an importance of 6.9%, followed by personal relationships and IS09001 certification, the importance is 4.1% and 2.9%. Therefore, product quality alone cannot create and deliver outstanding customer perceived value. It is necessary to continue to interact with customers through an in-depth understanding of customers and their preferences, and to identify key drivers of customer value and their dynamic changes, and clearly understand that customers are How to choose the product when considering the gains and losses. Find out what value areas are most important to customers, and look at what influences these value areas. If the company really studies the value of the target customers, it will help the company to cultivate its core competitiveness.

3. Focus resources on key value areas

It can be seen from the above analysis that companies can identify the key factors that need to be improved from two aspects: on the one hand, by understanding which are the key customer value drivers; on the other hand, by comparing the key value with competitors Relative position on the drive. The last thing an enterprise needs to do is to invest resources in the most competitive place, a key value area. The average input is on the product or service, and the final output will not be equal. In this way, companies can optimally allocate their strategic resources to maximize customer value. Therefore, for enterprises, it is important to focus resources on key areas to cultivate and improve core competitiveness.

4.Using the value chain to achieve alliance competitive advantage

As the division of labor becomes more and more detailed, the coordination and connection between industries will become more and more important. Intensified competition will make it difficult for companies to fight alone to reflect their competitive advantages. Therefore, companies must establish close value chain relationships with their supply and sales channels. So as to achieve the competitive advantage of the alliance. The enterprise value chain is not only interconnected within itself, but also closely related to the channel value chain of its suppliers and sellers. Therefore, the activities of the supply and sales channels affect the costs and benefits of the enterprise, and also affect the enterprise to maximize the perceived value of customers. Using the vertical links between value chains and strengthening their cooperation with suppliers and sellers, companies can increase overall customer value, reduce customer purchase costs, and maximize customer perceived value. Therefore, the differences between competitors' value chains are a key source of corporate core competitiveness. Using value chains to achieve network competitive advantage is an important part of establishing a customer's perceived value system.

5. Cultivate the ability to integrate resources

After identifying and understanding the expected value of the target customer, the enterprise must integrate the tangible and intangible resources of the enterprise, and the corporate and social resources to ensure the realization of customer value or the promotion of customer value. The integration of enterprise resources can be manpowered from the following aspects: the integration of human resources, enterprises should select and cultivate a staff with a keen market awareness and a strong customer awareness through the integration of human resources. Only companies that treat employees well can treat customers well; the integration of organizational resources, the transformation of the company's management organization system, and the introduction of a flat management approach to achieve the purpose of fewer levels, fast information transmission, large management scope, and relatively loose controls; corporate assets and The integration of social assets and the formation of complementary alliances between enterprises, giving play to their respective advantages, can better realize customer value.