Perceived Value: Is It Really All About Price?

Customers’ perceptions of value have improved enormously over the years, more so than for any of the other drivers of customer satisfaction. Given this fact, we focus on the feasibility—for both individual companies and the economy—of a continued focus on the value proposition as the primary driver of customer satisfaction. We discuss the pros and cons of continuing to drive aggregate customer satisfaction and economic growth via a price-based value proposition rather than quality and suggest that this may not be possible over the long term. While value is up at the national level, over both the past 10 and 25 years, not all industries have strong and improving value, and some are offering a significantly worse value proposition to customers.