Perceived value is an important factor for all businesses selling and marketing their products in the market. Perceived value is the uniqueness and appealing force of the product, which drives customers to buy the product to fulfil their needs and desires.
A product needs to be usable and satisfying in the eyes of the customers rather than the developers or designers of the product. It is something in the product that encourages them to buy the product. In this blog, we will learn more about Perceived Value and its importance.
What is Perceived Value?
Perceived value is a metric that is an assessment carried out by customers to decide the worth of the product or service based on its ability to fulfil their needs and expectations. Customers might be looking for a large variety of things with different perspectives, such as health benefits, savings, social status, and more.
Businesses also use different tactics to attract customers and convince them that their product is the best in the market and can solve their problem in the best way possible. There is a large variety of products in the market, almost similar to what a business is offering. Hence, to get a higher customer perceived value of a product, its usability, features, and problem-solving must stand out from the rest of the competitors in the same field.
Read More: What is Product Market Fit? | Definition and Examples
What Is the Importance of Perceived Value?
A perceived value is the ability of a product to lure customers into buying the particular product or service. When you go to a store and compare different items in a similar category, select only one that suits you the best in the end.
Here, the perceived value of the product makes you buy the product, which might be due to different factors, either the trust in the product, market value, safety, quality, and more.
- Marketing professionals work to enhance the perceived value of a product or service of their brand.
- Pricing of the product is one of the most important factors affecting the perceived value of the product.
- It is measured by the price customers are willing to pay for a good or service.
- The perceived value of a product or service can be greatly influenced by marketing of the product, which includes design, accessibility, usability, convenience, unique features, and more.
Read More: What Is a Product Specialist? Types, Roles, Skills
Types of Customer Perceived Value
Check some of the major facts about the Customer perceived value below.
1. Functional Perceived Value
This is one of the most important types of customer perceived value which refers to how well a product or service performs the functions it is intended to. Suppose a smartphone with long battery life and fast processing speed can be prioritised by people who prefer performance over other qualities of the product.
- Does the product meet your needs?
- Does it accomplish a defined task?
- Does it solve your problem?
2. Emotional Value
Emotional value is related to the overall feeling that a brand evokes in the customer with its products or services. It is directly related to the value offered by the product or service to the customers. It can include happiness, pride, confidence, and security. For example, a BMW car luxury brand car, also offers emotional value through status, happiness, and more.
3. Social Value
This type of perceived value is something that is concerned with how a brand enhances the social status or image of a product or service, helping them to fit in the group. Customers often prefer products that help them fit in with their people or gain acceptance from the society circles, which can be their family, relatives, friends, and more. For instance, people often follow trends in clothing to get social value or acceptance in their peer groups.
4. Economic Value
Also known as Monetary value, is something that customers compare the cost value or benefits that a product or service offers when compared to similar products of different brands. It assesses whether a product at the price is fair and provides better benefits. When customers find value in the product, justifying the amount they invest in the product, they give high perceived value to that particular product.
5. Experimental Value
This is something which happens when customers interact with brands over time, which takes into consideration their shopping experience, customer service, and more. When a brand provides fast delivery, friendly support, and more, they gain more perspective value from the customers.
How to Increase Customer Perceived Value?
There are several steps that a brand might take in order to increase the customer-perceived value of a product.
1. Enhance Product Quality
The best you can do to increase the perceived value of your product and service is to increase its quality and functional value. Customers often prefer or pay extra for products that are reliable, efficient, durable, and meet their expectations.
When companies prefer better materials, integrate new technologies, prefer safety, and ensure consistent performance, they improve their perceived value in the market. A high-quality product not only satisfies customers but also helps to build trust and positive word-of-mouth.
Read More: Product Delivery: The Ultimate Guide
2. Improve Customer Experience
Customer experience plays a major role in building the brand value of a product. When a brand provides faster delivery, better customer service, after-sales support, a smooth delivery process, and other features for their customers, they enhance the customer experience as customers feel cared for and respected, which increases the value of the brand in their eyes. This might also get them into paying more
3. Offer Emotional Benefits
Customers also prefer products or services with social and emotional value. Such as you as a customer would dream of buying a Porsche car due to the emotional value, performance, and the social status it provides. Emotional values can be increased or enhanced by aligning products to customer values, identity, and their aspirations.
When a product offers social status, and emotional value significantly increases perceived value. Brands like Nike or Apple achieve this by promoting lifestyles and communities around their products, making users feel empowered and socially recognized.
4. Economical Value
When brands provide the same benefits for a lower price compared to their competitors for a similar product, they can tap into the economic value in the minds of customers. However, it is not all, brands also have to justify that the value they provide at such a low price is justified and in the interest of the people.
Customers get more than satisfied when they get more in what they paid for. When brands offer transparent and fair pricing with added extras and offers are more preferred by customers.
5. Communicate Clearly and Effectively
Customers need to interpret everything that makes your product or service more valuable when compared to thousands of similar products in the market. You can use an official website, provide decent packaging, run ads, and offer sales conversations to communicate all major benefits and features offered by your brand.
You can use testimonials, product reviews, and visuals to showcase customer satisfaction and the benefits of using your brand’s product. If people don’t know what they’re getting, they can’t perceive the full value.
6. Build Trust and Credibility
Trust is one of the most important pillars of a product or service. When customers believe that the brand is reliable, honest, good quality, has positive online reviews, offers secure transactions, provides strong customer support, safer transactions, active customer support, and more, they are willing to pay for your product or service, stay connected with the brand, support new products, features, and more.
Also Read:
- Product Placement: When Advertising Feels Natural!
- What Is an AI Product Manager? Venn Diagram, Roles, & Manifestos
- Product Line : Meaning, Types, Advantages, Disadvantages and Working
- Product Analytics 101: Definition, Metrics & Tools
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Perceived Value of Product FAQs
Q1. What is the perceived value of a product?
Ans: Perceived value is a metric that is an assessment carried out by customers to decide the worth of the product or service based on its ability to fulfil their needs and expectations.
Q2. Why is perceived value important?
Ans: A perceived value is something that defines the ability of a product to lure customers into buying the particular product or service. When you go to a store and compare different items in a similar category, only select one that suits you the best in the end.
Q3. What are the types of perceived value?
Ans: Functional value, social value, emotional value, economic value, and experiment value are some of the types of perceived value of a product or service.
Q4. What is an example of perceived value?
Ans: An Apple smartphone is a costlier option compared to other options in the market. Also, maintenance costs and other integrations are different from others, but it provides prestige, quality, status, and unique features that lure customers into buying it.
