This document discusses key concepts related to customer value in marketing. It defines customer value as the benefits customers receive from a product or service relative to the costs they must pay. It also discusses how companies like Air Deccan and Virgin Atlantic create and deliver value to different customer segments. Overall, the document emphasizes that understanding customer value and developing customer loyalty are important aspects of effective marketing strategy.

2. Submitted to :
Ms Meenu kundra
( Department of commerce And management )
Submitted by :
karanjot kaur

3. Meaning of value in marketing :
customer with hard earned money are
the value – Maximiser with in the
framework of search cost and limited
knowledge ,mobility and income. They
want to get limited value for their
money. That is ,that is they form an
expectation of value and act up on it.
whether or not the offer lives up to the
value expected influences both
satisfaction and repurchase probability.

4. Customer gets benefits and ,there for assumes
costs. The costs comprise of money, time ,
energy and psychic cost
value = Benefits/ costs
= functional benefits / = Emotional benefits/
Monetary cost + Energy costs +
time cost psychic cost

5.  Difference between total customer value and total
customer cost.
TCV TCC
Is the bundle of is the bundle of that
Benefits that customer customer expect to
Expect from given product. incur in evaluating ,
and disposing off
of that product

7. AIR DECCAN VIRGIN ATLANTIC
 The air travel industry
pioneered low cost
travel and popularized
air travel among the
middle class.
 1. Price 20-25 % lower
than that of Indian
airlines.
 2. supported by a
variety of attractive
options/incentives
 ‘ virgin Atlantic
picks me from home
 1. Handover
boarding pass at my
car window.
 2. I go straight to
virgin Atlantic
lounge
 3. In flight , I can
get my hair cut ,
shoes polished

8. 3. Have a shuttle service
that covered south India .
4. Multiple routes and
multiple time options.
“ AIR DECCAN’S
proposition was –
‘simply fly’ yes it was
now affordable and
available.
 4. I’ m asked how I
want my meal , and
when I want it. It
served accordingly.
 5. when I get off, I
am picked up I don’t
have
to queue for a taxi
in a strange place.
 VA had plotted the
customer frustration
points that most
travelers faced at
airport and flight.
 Appropriate new
service that would
make the customer
comfortable.
 Price is carrier of value
here.
 Airline providing simple
economic value to
target customer.

9.  AIR DECCAN IN VALUE DLIVERY
 Offer product at lower
prices. Making them cheap
and hence affordable .
 Attracted hitherto non fliers
for whom high price was the
real barrier.
 The whole package
meant a substantial
value addition to the
customer.
 unlike air Deccan V/A
customer segment did
not base their decision
on price alone. They
want comfortable
travel with several
small and on s . So
that they reach the
destination fresh and
ready for work.

10.  ANS : Give him what he
needs and charge the
price that he is ready to
pay.

11.  1. The seller must assess the total customer
value and total customer cost associated with
each of his competitor offer to know whether
his own offer rates the buyer’s mind.
 2. seller who is at a delivered value
disadvantage has two alternative .
Seller try to increase total customer value
or
Decrease total customer cost

12.  FIRST ALTERNATIVE : Calls for strengthening
the offers‘ product , service , personnel and
image benefit.
 SECOND ALTERNATIVE : Calls for reducing
cost y reducing the buyer risk by offering
warranty.

13.  1. Complaint and suggestion system.
 2. customer satisfaction survey .
 3. Ghost shopping or hiring mystery shopper.
 4. lost customer analysis.

14.  Manager who believes the customer is the
company’s Only true “ profit center”
consider the traditional organization .
Top
management
Middle management
Front-line people
customer

15.  MODERN CUSTOMER – ORIENTED ORGANIZATION
CHART :
CUSTOMER
FRONT LINE PEOPLE
MIDDLE
MANAGEMENT
TOP
MANAGEMENT

16.  At the top are customers ;
 Next in importance are front line people who
meet, serve and satisfy customers;
 Under them are middle manager (whose job is
to support the front line people so they can
serve customers well;
 And at base is top management ; whose job is
to hire and support good middle managers.
 We have added customers along the sides to
indicate that managers at every level must be
personally involved in knowing , meeting, and
serving customers.

17.  CONCEIVED A MODEL OF CHARACTERSTIC A
HIGH PERFORMANCE BUSINESS.

18.  STAKE HOLDERS
 PROCESES
 RESOURCES
 ORGANISATION
 IT WILL NOT BE OUT OF PLACE IF A BRIEF
REFERENCE IS MADE TO EACH CHARACTER
STIC.

19.  CUSTOMER, EMPLOYESS,SUPPLIERS,
DISTRIBUTERS , ADDITION TO SHAREHOLDERS.
1. Each business must work hard to satisfy
minimum expectation of each stakeholder
group.
2. Company might aim at
 Delighting its customer ,
 Perform well for its employees
 And given threshold well of satisfaction to
the suppliers.

20.  IN setting these level, the company must be
careful not to violate the various stakeholder
groups sense of fairness about the relative
treatment that they are getting.
dynamic relationshipconnecting the stakeholder groups .
Hardworking and smart company creates
a high level of employees satisfaction
which leads to higher satisfaction,
which leads to more repeat business
leading, in turn , to higher growth and
profit further , leading to high stake-
holders satisfaction.
IT DOES NOT STOP AT THAT IT LEADS TO MORE
INVESTMENT SOON.

21.  High performance companies, instead of carrying
on the work by departmentalization , they
increasingly focusing on the need to manage
core business processer such as:
 1. New product development,
 2. customer attraction and retention.
EXAMPLE : X company a customer operation
group link sale , shipping , installation , service
and billing so that these activities flow
frictionlessly in to one another so therefore,
willing companies will be those that achieve
excellent capability in managing the core
business process through cross functioning
team.

22.  It is experienced that companies are finding that
some resources under their control are not
performing as well as those that they could obtain
from outside the company . So companies have
outsourced less critical resources . Its comprise of
auto fleet management.
 FOR EXAMPLE : Nike company does not manufacture its
shoes because , there are certain Asian manufacturers who
are more competent in this task, even in case of India , Bata
company encourages other to produce specifying the
standards and sell those under various brands of Bata . Its
Nike , Adidas ,puma where the name matters. These
companies nurture their superiority in shoe – designing and
shoe merchandising the two core competencies.

23.  Company organization made up of its
structure policies and corporate culture.
Which is badly affected in a rapidly
changing business Environment . So
companies policies and structure can be
changed with certain amount of
apposition and difficulty. It is very
difficult to change organization structure
. Its hard task to implement new
strategies with great success.

24.  We enter any company the first thing that
strikes to our mind is of corporate culture-
 The way people are dressed.
 How they talk to one another ,
 The way they greet the people checking in
and checking out.
CORPORATE CULTURE DEVELOPS
ORGANICALLY AND ITS TRANSMITED
DIRECTLY FROM CEO’S PERSONALITY
AND HABITS TO THE LAST EMPLOYEE AT
FLOOR LEVEL .

25. EXAMPLE : Not be better example
than that of Billionaire bill gates,
founder of Microsoft company
today a 14 billion us dollar
company has not lost its hard
driving culture perpetuated by him
– start with – as a small
entrepreneur Microsoft's ultra
competitive culture is the biggest
key to its thundering success and
to its much criticized dominance in
the computer industry .

26. Visionary comparison
 Are more admired industry
leaders ,
 they set their ambitious
goals,
 communicate them to
employees
 and embrace a high
purpose beyond making
money.
SUCH COMPANIES ARE:
 GENERAL ELECTRIC
 HEWLETT PACKARD
 They have nothing
unique to say .
 They does not have
values.
 Keep looking at the
competitor and does
what other do.

27.  Holds distinctive set of values from which
they do not deviate
 Express its purpose in enlightened term .
 Developed a vision of its own future and
acts to implement it.

29.  Definition : “ The challenge is not to produce satisfied customers
, several competitors can do it . The challenge is to produce loyal
customers” MR . JEFFREY GITOMER
 Good companies not stopping at the value chain analysis, they
are keen on developing stronger bonds of relationship and
loyalty with their final customers.
 In past manufactures and marketers took customer for granted
reasons . The customers might not have had many alternative
source of supply. Now things have changed customers have more
alternatives suppliers
 They are smarter ,
 More price conscious,
 More demanding less forgiving
 Approaching by more competitors
Its really hard to please them .

30.  To generate leads .
 1. companies develop advertisement and place them on
suitable and viable media that will reach new prospect .
 2. They Might send direct mail and have phone calls to
the possible new prospects, their sales- persons
participate in trade shows where they might find a few
leads.
 3. Next task is to qualify which of the suspects are really
good prospects. Which can be done by interviewing
them . Checking their financial standing.
 4. these prospects may be graded as hot, warm and cool
 5. sales people contact first the hot prospects and work
on account conversion that involve making
presentations , advertising objections and negotiating
final terms.

31.  The point lies in not getting only new
customers but to keep the turnover of
customers at lower point.
Most of the companies gain new
customers to lose old customers( Its called
high customer churn)
(ITS IS AN OBORITIVE ATTEMPT OF FILLING
LEAKING TANK WITH WATER CONTINOUSLY )

32.  Defining and measuring its retention rate
 Distinguishing the cause of customer
defection and indentify those that can be
managed better.
 Estimating the loss of profit caused by loss of
customer.
 Estimating how its costs to retain customer .

33.  Stay loyal longer
 Buy more as company introduce new product
and upgrade existing product.
 Talk favorably about company and its
product.
 Pay less attention to competing brands and
ads is less sensitive to price.
 Offer product or service ideas to the
company as an experienced expert.
 Costs less to serve than new customers
because transactions are routinised.

34.  CONCLUSION : Creating customer
value through marketing is absolutely
critical. Any organization that fails to address
the creation of value for their customers will
not succeed in business. Value can be
created by the firm internally by focusing on
the way the product is produced and
presented.