Introduction – Value Marketing
In this article let’s see What is Value Marketing, its Advantages & different Strategies used.
What is Value in Marketing
Value in marketing, also known as customer-perceived value, is the difference between a prospective customer’s evaluation of the benefits and costs of one product when compared with others. Value may also be expressed as a straightforward relationship between perceived benefits and perceived costs:
Value = Benefits – Cost.
What is Value Marketing
Value marketing aims to build a relationship between consumers and the company and its brand. Today, many companies are shifting from cost-based pricing to customer-perceived value analysis and value-based pricing.
What is Value Marketing Benefits
The benefits of this shift include developing a better understanding of:
- What factors differentiate your product from the competition
- How much those differences are really worth to the customer
- How much of a price premium (if any) you should be able sustain over the competitors
- What improvements to your product would add the most value from the customers perspective
- How you should position and promote your product to stress your comparative advantages
- Value-Based Marketing and Pricing describes the tools that Customer Value, Inc. uses to help companies achieve a comprehensive, consistent approach for appraising their customer perceived value versus rival brands and executing value-based pricing
What is Value Marketing Strategy
Value Based Marketing Strategy
The objective of this strategy is to sell the right products to the right customer segments at the right price to maximize profits and growth. The underlying philosophy is that if we understand customer needs and satisfy them better than the competitors do, our business will be successful.
What is Value Marketing Advantages
This type of Marketing can help you:
- Understand your competitive strengths and weaknesses
- Identify opportunities to improve your product and service, and set priorities for
- improvement based on your customer needs
- Set prices that are consistent with your strengths and weaknesses
- Sharpen your marketing message to highlight your strengths and correct customers misperceptions
- Test new product concepts
What is Value Marketing System
For companies that serve many markets (e.g. product lines of related products, different geographical markets for core products, different key account customers for a product), the system should help you:
- Evaluate your product line coverage
- Avoid cannibalizing a high-margin product with a low-margin one
- Coordinate product and pricing across different geographical regions.
- Develop benchmarks for evaluating product success in one market or key account customer based on results in other markets or key accounts
- Maintain pricing consistency across different regions
- Identify cross-market management issues, systemic strengths or weaknesses, that merit centralized attention
What is Value Marketing Tools
Analyzing a Product-Market Segment
- Market Profile – a compact data set that compares your product to the competition from
- the customer perspective
- Value Map – a visual display that looks at competitors in a price-performance space,
- allowing you to see if you are competitively positioned
- Product Appraisal – a collection of tools for helping you set prices based on what your
- product is really worth
- Value-Pricing Chart – a graph that shows how much more, or less, your product is worth
- than a reference product and how setting your price splits the difference between your
- product’s worth and cost into profit margin for you and customer surplus for buyers
- Value-Selling Tools — to help you identify how to extract the full value of your
- performance advantages
- Improvement Priorities Tools -helping you to identify who must do what by when to improve your competitive position.
Value Marketing FAQ
What is value in marketing with example?
Value in marketing, also known as customer-perceived value, is the difference between a prospective customer’s evaluation of the benefits and costs of one product when compared with others.
What are 4 types of values?
- Functional Value
- Monetary Value
- Social Value and
- Psychological Value
Why is value important in marketing?
Value-Based Marketing and Pricing describes the tools that Customer Value, Inc. uses to help companies achieve a comprehensive, consistent approach for appraising their customer perceived value versus rival brands and executing value-based pricing
What is meant by value in marketing?
Value may also be expressed as a straightforward relationship between perceived benefits and perceived costs. In simple term Value is Utility per cost. Value = Benefits – Cost
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