The aim of several growing enterprises today is to satisfy their customer’s needs. Traditionally firms achieved value creation by offering differentiated product and services. With increasing competition and emerging technologies, organizations are compelled to offer something more than they could actually do (Barney J B, 2007; Manning 2004).
Customer value creation
Customer value creation in dynamic environment can be achieved by making each function or feature of a product or service unique rather than differentiating a product or service as a whole. Today, measurement of customer’s satisfaction has become an important job to be accomplished. For instance, manufacturing a new detergent powder was customer value creation in the past. However, manufacturing a washing-machine friendly detergent powder is customer value creation in today’s market scenario.
Importance of customer value creation
Importance of customer value creation can be explained best with the example of Vim dish washing liquid. Recently, Vim dish wash solution, a product of Hindustan Unilever limited (HUL) has recently proven its customer value by breaking the history and getting itself registered in the Guinness record. HUL demonstrated the power of Vim by washing exactly fifteen thousand three hundred dirty plates with just half a liter of Vim solution. The Guinness record has identified Vim to offer the greatest value for money when compared with all its competitors. Customer value creation can be achieved in an organization by keeping its eye on customers’ changing attitudes and behavior over a long run (Woodside A G, 2006).
The taste, preference and perception of customers keep on changing with their attitudes and external factors that influence them. In order to keep the businesses going and growing, enterprises must keep their customers satisfied. Satisfying customers can bring in several positive aspects to a company and can contribute a successful business. In an organization, everyone must be involved in customer value creation process and top managements must communicate exactly to each personnel how he or she would be expected to contribute to the success of the process (Kodama M, 2007).
Impact of technology on customer value creation
With the advancement in technology, customer value creation can now be achieved easily through tools such as mobile phones, social network websites, online communities, etc. It is essential that organizations make use of these tools in order to keep track of changing customer attitudes in order to make their brand name remembered and preferred by the customers (Hill N and Alexander J, 2006). With the changing lifestyle and increasing economic status of people, customer definition for value is also dynamically changing. For example, China mobile, a Chinese telecom company, which has the largest subscriber base in the world, is now prone to competition by a new entrant, “Little smart” (Wei C and Ling X, 2004). Little smart supersedes China Mobile by offering mobile services at cheaper rates. China mobile is subject to this new threat since it failed to study the changing attitudes and needs of its customers.
Therefore, in order to, portray products & services and last long in the market, organizations must think of innovative ideas to emphasize on customer value creation. They should implement it irrespective of their current market position, size or core technology.
- Wei C and Ling X (2004), ‘Market competition behaviors of mobile communication industry in China’. Journal of Harbin Engineering University, Vol.25, pp 124-126, UK.
- Barney J B (2007), Gaining and sustaining competitive advantage, Prentice Hall, New York
- Wei C and Ling X (2004), ‘Market competition behaviors of mobile communication industry in China’. Journal of Harbin Engineering University, Vol.25, pp 124-126, UK
- Hill N and Alexander J(2006),The handbook of customer satisfaction and loyalty measurement , Ashgate publishing company, USA