Buyers Perception of Value

(BPV)
A trade-off between the
perceived benefits (value) of
the service to be purchased
and the perceived sacrifice
(cost) in terms of cost to be
paid.
Perceived Value (total value)
Product Value
Service Value
Personnel Value
Image Value
Perceived Cost (total cost)
Monetary Cost
Time Cost
Energy Cost
Psychic Cost
Perceived Value
Product Value: The worth
assigned to the product by the
customer.
Service Value: The worth
assigned to the service by the
customer.
Personnel Value: The worth
assigned to the service
providing personnel by the
customer.
Image Value: The worth
assigned to the service or
service provider by the
customer.
Perceived Cost
Monetary Cost: The actual
dollar price paid by the
consumer for a product.
Time Cost: The time the
customer has to spend to
acquire the service.
Energy Cost: The physical
energy spent by the customer
to acquire the service.
Psychic Cost: The mental
energy spent by the customer
to acquire the service.
Special Considerations of
Service Pricing
Demand Considerations
Cost Considerations
Customer Considerations
Competitive Considerations
Profit Considerations
Product Considerations
Legal Considerations
Price Discrimination
The practice of charging
different customers for
different prices for similar
services.
Criteria for Effective Price
Segmentation
1.Different
groups
of
consumers must have different
responses to price. 2.Different
segments must be identifiable,
and a mechanism must exist to
price them differently. 3.No
opportunity
to
sell
or
exchange of tickets of one
group to another. 4.Large
enough segment to make the
exercise worthwhile. 5.The
cost of price segmentation
should not exceed the
revenues
obtained.6.The
consumers should not be
confused by the strategy.

Service Pricing Strategies

Satisfaction-based pricing:
Pricing strategies that are
designed to reduce the amount
of perceived risk associated
with a purchase.
Benefit-driven pricing: A
pricing strategy that charges
customers for services
actually used as opposed to
overall membership fees.
Flat-rate pricing: A pricing
strategy in which the
customers pay a fixed price.
Relationship pricing: Pricing
strategies that encourage the
customer to expand his or her
dealings with the service
provider.
Price bundling: The practice
of marketing two or more
products and/or services in a
single package at a single
price.

Chapter :7
Developing Service
Communication Mix
1.Nonpersonal and personal
sources.
2.Developing
communication strategies.
3.Communication
contents
and objectives in PLC stages.
4.Problems of the service
communications mix.
5.General
guidelines
for
developing
service
communications
Non personal Vs Personal
sources of Info
1.Nonpersonal sources of
information 2.Personal
sources of information
Developing communication
strategies
1.Selecting Target Markets
2.Developing Firms
Positioning Strategies
3.Developing the
Communication Budget
Problems of the service
communications mix
Mistargeted communications
Managing expectations
Advertising to employees
Selling/Operational conflicts
General guidelines for
developing service
communications
1.Develop a word-of-mouth
communications network
2.Promise what is possible
3.Tangibilize the intangible
4.Feature the working
relationship between customer
and provider
5.Reduce customer fears
about variations in
performance
6.Make the service more
easily understood
Communication Tips for
Professionals
1.Turning current clients into
company spokespersons
2.First impressions are
everything
3.Create visual pathways that
reflect the firms quality
4.Establish regular
communications with clients
5.Develop a firm brochure
6.An informed office staff is
vital