CUSTOMER PERCEIVED VALUE OF SERVICES

Customer Perceived Value of Services



Customer Perceived Value of Services

Introduction

Customer perceived value is the term used to define the difference between the potential customer's evaluation of the benefits as well as the cost that may be incurred as well as any perceived alternatives. It is a term that is purely related to management and business administration. Total customer value is a related concept as well, and defines the prospective customer's evaluation of the profits and the costs incurred through the offering and the alternatives as well. As opposed to this, customer cost is the monetary value perceived by potential customers which is why an evaluation takes place before obtaining and utilizing the product. In this paper, I will be analyzing the concept of customer perceived value as well as related concepts that are made use of in the management of businesses.

Discussion

Customer perceived value can be understood if one breaks down the whole concept. A customer is the one who receives the products of a brand name or an organization. There are internal customers, which are individuals within an organization receiving a product from another individual of the same organization. Meanwhile external customers are individuals as well as organizations that receive goods or services in exchange for money or of any offering of equal value. Customer needs are the focal point in an organization, meeting them is the number one goal. The product bundle is the goods and services that a customer is expecting to acquire. Needs are non negotiable, however may be non obligatory or of changeable significance to the customer. Customers often seek to acquire value for their money, thus go through a range of alternatives before they finally make decisions about final product. The expectations of customers are evaluated on the perceived values of aforementioned product bundles, and specific needs or desires. These expectations are based on or influenced by surrounding environment or cultural value, as well as advertising and marketing strategies. Other communications are also considered as part of the focus of expectations, such as specific promotional strategies or indirect marketing. The supplier and the source can also have a part. Unless customer needs, their expectations are subject to variation and are negotiable and modifiable, provided the right campaigns are prepared to influence outside factors. Thus, customer perceived value becomes the value of a package, a product bundle's worth in customers eyes. It may be measured in money, can be an evaluation based opinion or influence. Valuations are also made on the product by the customer, pertaining to the price of the product, which is usually how customers compare it to alternatives in a competitive and open market. These definitions may not provide a clear enough idea of a customer perceived value concept, but it may be analyzed why one product holds more worth in the eyes of the customer over another through measuring the worth of “value”, and how it is considered by ...