Discuss the concept of customer value and its importance to successful marketing. How are the concepts of customer value and relationship marketing linked?

For a business to be successful, the product they produce should be perceived as worthful to customers who buy the product for their benefit. Therefore, the paper will answer some questions such as the concept of customer value, the importance of customer value to successful marketing, and the link between customer value and relationship marketing.

Step-by-step explanation

Explanation

Discuss the concept of customer value

People define value differently. Customers may define value as the price of a product. Some define value as the benefit of something, and others define it as the worth of something. Customer value, therefore, means the perception of what a product or service is worth to a customer who is buying the product versus the possible alternatives available (Payne, 2017). Worth means whether the customer feels they got benefits from the product they paid for. The formula to get customer value is equal to benefits minus costs. Here, benefits include the advantages or quality of a product, service, brand, and image.

Importance of customer value to successful marketing

Customer value is essential to successful marketing because it increases loyalty. When customers perceive that a product bought is worthy to them, they will continuously buy that product because they feel that the product has certain benefits they like. The customers will stay loyal to the product, thus leading to successful marketing.

Customer value is vital to successful marketing because it reduces errors and increases efficiency. When customers perceive a product as worthless, it means that the product is not beneficial. Therefore, in their efforts, producers will be forced to correct any error the product has, thus leading to increased efficiency if the errors are corrected. When errors are corrected, and the product is efficient, the marketing will function successfully.

Customer value is important to successful marketing because it increases market share. When market shares are high, it means that the business is performing efficiently. Therefore, when market share is high, and efficiency is better, the business's profits will increase, leading to successful marketing.

How are the concepts of customer value and relationship marketing linked?

The approach by which the customer is regarded as an essential company asset represents a vital evolution in relationship marketing. Being the convergence point of organizational activity, the customer is perceived in a constantly growing measure, not only as of the bearer of demand the business seeks to satisfy but also as an essential asset, a measurable value needing a correct determination.