Creating and Delivering Value
Man is guided by the idea of utility in his purchase decisions. He will select a product that offers him the maximum utility for the money he parts with. More often the buyer seeks much more to utility. He seeks VALUE * All buyers seek Value in all their purchases and they look for it in the form of benefits. * Customer compares the Total Cost & Value of all competitors’ offers before he takes a decision. * Marketing is out & out a value game. * Customer Value is the composite of tangible values as well as intangible values. * The two categories not mutually exclusive; they overlap and blend * Intangible values are equally vital as tangible ones

Tangible Values * Functional value * Economic value * Convenience value * Sensory/aesthetic value- Scenic Beauty * Service (people) value
Intangible Values * Social value * Prestige/status value * Sentiment value * Belief value
Activity: Give examples of brands which position themselves based on the above value types
Value creation can be through two types: 1. Co-creation – Creating value by taking inputs from the consumer and incorporating it in the product/service

Examples discussed in class: * Mia from Tanishq – ‘My expressions’ * BMW launched co-creation lab * Fiat Punto * ‘Courtyard’ from Marriott Travel brilliantly.com * Spencer – retail chain * Inkfruit – Crowd sourcing * Amazon * Lays

2. Customer Driving - In some product categories you need to be Customer Driving rather than Customer Driven e.g. Technology Products.
Henry Ford said, if he had to listen to people he would have come out with a faster Horse instead of a car.
Google – no one thought it would be so handy and part of our life. Cell Phones – Initially were not accepted so well.

Value Creation and Delivery