CUSTOMER PERCEIVED VALUE

Customer Perceived Value is also known as Customer Value It can be defined as “The difference between the prospective customer's evaluation of all the benefits and all the costs of an offering and the perceived alternatives."
                   -  Philip Kotler

Customer Perceived value is classified into Total Customer Benefit and Total Customer Cost.

Total Customer Benefit is defined as the perceived monetary value of the bundle of economic, functional and psychological benefits customer expect from a market offering because of the product, service, people and image.

Total Customer Cost is the perceived bundle of costs customers expect to incur in evaluating, obtaining, using and disposing of the given market offering, including monetary, time, energy and psychological costs.

                                              

Total customer benefit is a summation of :

·     

            Product Benefit- Product benefit relates to  the advantages a customer may derive on consumption of the product. These arise out of the generic product qualities. 
In the case of Frooti is a non aerated fruit drink perceived to be healthier than the soft drinks consumed to refresh one self and satisfy the basic need of thirst.

·         Services Benefit: Services offered with the product is the service benefit for that product.
For Frooti the contact details of the company, the expiry date, manufacturing date, ingredients used etc could represent the service benefit.

·         Personnel Benefit: It includes the customer's perception of the utility value of the personnel in the system of the product to him/her. Better, knowledgeable and well trained personnel assisting a customer would be great.
For Frooti there is no direct personnel benefit as such.  The product is available on the shelves of kirana outlets and retail stores. A good distribution channel ensuring easy availability of the product would probably be the personnel benefit.

·         Image Benefit : The reputation of the brand in the market plays a crucial role in decision making. What the customer thinks of the product and what others think of him consuming the product is very vital.
Frooti has always been associated to youth. It comes across as a trendy and cool drink. The ‘ Fresh n Juicy ‘ positioning did wonders for the product.

Similarly Total Customer Cost is the summation of the monetary cost, time cost, energy cost, psychological cost of the product.

• Monetary Cost- This includes all kind of the cost paid by the customer to obtain the product. It includes the price of the product, travelling expenses paid by the customer etc.
• Time Cost-  Total amount of time invested by customer during the buying process. It also would include the time for which the customer can be influenced by the other product. Time can be in seconds, minutes or hours.
• Energy Cost- Total energy spent by the customer in the buying process. It is not clear that for what purpose the term "Energy" is used.
• Psychological Cost- It is the mental effort made during buying, using and maintaining the product.