The Value Proposition Concept in Marketing: How Customers Perceive the Value Delivered by Firms

Hassan, A. (2012)

International Journal of Marketing Studies, Vol. 4, No. 3. pp69-87
DOI: 10.5539/ijms.v4n3p68
Loyal customers are the key factor of success in all organizations. They spend money, they recommend to others and they repeat buy from the same organization, as long as it delivers consistent value. Creating and delivering value where it is needed is not an easy job for a marketing planner. This study seeks to provide strong understanding of the concept of the value proposition from the academic perspective, as regards the actual understanding of what customers perceive about the organizations. This study took place in Southampton in the United Kingdom, on customers of four main supermarkets to identify the way they shop, the value they seek and the value they actually obtain from each supermarket. The method used for this study was qualitative with a use of mini-depth interviews as the approach of collecting and analyzing the data. The results indicated that the value proposition is a widely used concept, but there is no specific definition of it. Value can be created through more than one element, such as price, quality and location. Companies therefore are responsible for setting the value they seek to deliver based on their strategies and their shareholders' values. They are responsible for communicating them and managing the change occurring in the market. Marketing provides marketing strategies and tactics that are aligned with the overall strategies of the organization, to help deliver the best value to customers. Interview results showed that customers perceive different type of values mainly depends on their age, marital status, home location, and shop prices. Some supermarkets communicate their values clearly and some do not. Some of them provide more than one element of value and others tend to focus on just one, such as Waitrose focusing on quality. The findings provided some strategic recommendations on both sides to help improve the value proposition to end customers. This includes corporate and marketing strategic considerations and the need to identify and fulfill customers' expectations. Creating competitive advantage will finally lead to customers' loyalty and generate profits.

Defines value proposition.


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