Download 0324379749_134523

Chapter 2: Value and the
Consumer Behavior Value
Framework
Babin/Harris
© 2009 South-Western, a division of Cengage Learning.
Learning Outcomes
1.
2.
3.
4.
5.
6.
Describe the consumer value framework, including its basic
components.
Define consumer value and compare and contrast two key
types of value.
Apply the concepts of marketing strategy and marketing
tactics to describe the way firms go about creating value for
consumers.
Explain the way market characteristics like market
segmentation and product differentiation affect marketing
strategy.
Analyze consumer markets using elementary perceptual
maps.
Justify adopting the concept of consumers’ lifetime value as
an effective long-term orientation for many firms.
© 2009 South-Western, a division of Cengage Learning.
2-2
The Consumer Value
Framework (CVF)

LO1
Represents consumer behavior theory
illustrating factors that shape
consumption related behaviors and
ultimately determine the value
associated with consumption.
© 2009 South-Western, a division of Cengage Learning.
2-3
Value and the CVF
Components


Value is at the heart of experiencing
and understanding consumer
behavior.
Components of the CVF:




LO1
Relationship quality
Consumption process
Internal influences
External influences
© 2009 South-Western, a division of Cengage Learning.
2-4
Relationship Quality


LO1
Reflects the connectedness between a
consumer and a retailer, brand or
service provider.
High perceived value improves
relationship quality.
© 2009 South-Western, a division of Cengage Learning.
2-5
Consumption Process





LO1
Needs
Wants
Exchange
Costs and benefits
Reactions
© 2009 South-Western, a division of Cengage Learning.
2-6
Internal Influences

Things that go on inside the consumer
or that can be thought of as part of the
consumer.


LO1
The psychology of the consumer.
The personality of the consumer.
© 2009 South-Western, a division of Cengage Learning.
2-7
Psychology of the Consumer


LO1
Cognition – the thinking or mental
processes that go on as we process
and store things that can become
knowledge.
Affect – refers to the feelings
experienced during consumption
activities or associated with specific
objects.
© 2009 South-Western, a division of Cengage Learning.
2-8
Personality of the Consumer


LO1
Every consumer has certain
characteristics and traits that help
define them as an individual.
Individual differences – include
things like personality and lifestyle.
© 2009 South-Western, a division of Cengage Learning.
2-9
External Influences:
Interpersonal Influences

External influences include the social and
cultural aspects of life as a consumer.


LO1
Social environment includes the people and
groups who help shape a consumer’s everyday
experiences.
Situational influences are things unique to a
time or place that can affect consumer decision
making and the value received from
consumption.
© 2009 South-Western, a division of Cengage Learning.
2-10
Value




LO2
A personal assessment of the net worth
obtained from an activity.
Value = What you get – What you give
Utilitarian value – how the consumer
solves jobs that come along with being a
consumer.
Hedonic value – the immediate gratification
that comes from experiencing some activity.
© 2009 South-Western, a division of Cengage Learning.
2-11
Marketing Strategy


The way a company goes about creating
value for customers.
Strategy exists at several levels:



LO3
Corporate strategy – deals with how the firm
will be defined and setting general goals.
Marketing strategy follows.
Marketing tactics – ways marketing
management is implemented (price, promotion,
product, and distribution).
© 2009 South-Western, a division of Cengage Learning.
2-12
Total Value Concept


LO3
The understanding that products
provide value in multiple ways.
Every product’s value is made up of
the basic benefits, plus the augmented
product, plus the “feel” benefits.
© 2009 South-Western, a division of Cengage Learning.
2-13
Market Segmentation

LO4
The separation of a market into groups
based on the different demand curves
associated with each group.
© 2009 South-Western, a division of Cengage Learning.
2-14
Product Differentiation

LO4
A marketplace condition in which
consumers do not view all competing
products as identical to one another.
© 2009 South-Western, a division of Cengage Learning.
2-15
Product Positioning


LO5
The way a product is perceived by a
consumer.
Perceptual map – used to depict the
positioning of competing products
graphically.
© 2009 South-Western, a division of Cengage Learning.
2-16
Customer Lifetime Value
(CLV)



LO6
Represents the approximate worth of a
customer to a company in economic
terms.
The overall, long-term profitability of an
individual customer.
CLV=npv(sales – costs) + npv(equity)
© 2009 South-Western, a division of Cengage Learning.
2-17