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CSR 631 Research Stream. Consumer value. Jooyeon Ha. Contents. Foundation : Value theory 1970s 1980s 1990s 2000s. Value Theory.

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  • Foundation : Value theory
  • 1970s
  • 1980s
  • 1990s
  • 2000s
value theory
Value Theory
  • Value theory encompasses a range of approaches to understanding how, why, and to what degree humans should or do value things, whether the thing is a person, idea, object, or anything else.
  • This investigation began in ancient philosophy, where it is called axiology or ethics. Early philosophical investigations sought to understand the concept of "the good". Today much of value theory is scientifically empirical, recording what people do value and attempting to understand why they value it in the context of psychology, sociology, and economics.


  • Hunt, S. D. (1976): Value in marketing

The basic subject matter of marketing includes all transaction that involve any form of exchange of values between parties.

  • Monroe, K. B. (1979): Price as an index of Value

Value: The number of units of quality per dollar expenditure

Value = quality/price

= perceived quality as a function of price/price


Holbrook, M. B. (1984)

Typology of consumer value


Thaler. R. (1985)

: Development of a model of consumer choice blending economic reasoning with principles of cognitive psychology.

1. The value function is defined over perceived gains and losses relative to a reference point.

2. The value function is explained by gains and losses in consumer’s consumption situations.

3. The loss function is steeper than the gain function. People are more sensitive to the prospect of a loss than to the prospect of a gain.

  • Buyers evaluate a purchase opportunity by first judging the value of the offer and then deciding whether to make the purchase.
  • Price plays a role in the evaluation process.

Perceived Quality



  • Dodds, W. B., & Monroe, K. B (1985)



Perceived Value

Willingness to Buy




  • Buyers use price as an index of perceived product quality as well as an index of the perceived sacrifice that is made when purchasing a product.
  • Perceived value represents a trade-off between buyers’ perceptions of quality and sacrifice and is positive when perceptions of quality are greater than the perceptions of sacrifice.

Monore, K. B., & Champman, J. D. (1987)

Acquisition Value vs. Transaction Value

  • Acquisition Value: The perceived benefits inherent in the product compared to the sacrifices and is defined as (maximum acceptable price – actual price).
  • Transaction Value: The perceived merits of the offer and is defined as (reference price – actual price).

PV = acquisition value + transaction value


Zeithaml, V. A. (1988)

  • Four dimensions of value

1. Value is low price: Consumers equate value with low price, indicating that what they had to give up was most salient in their perceptions of value.

2. Value is whatever I want in a product: Consumers emphasize the benefits they receive from the product as the most important components of value.

3. Value is the quality I get for the price I pay: Consumers conceptualize value as a tradeoff between one “give”, price, and one “get” component, quality.

4. Value is what I get for what I give: Consumers consider all relevant “get” components as well as all relevant “give” components.


Sheth, J. N., Newman, B. I., & Gross, B. L. (1991)

Five dimensions of consumer value influencing consumer choice







Consumer Choice Behavior






Five dimensions of value

1. Functional Value: The perceive utility acquired from an alternative’s capacity for functional, utilitarian, or physical performance.

2. Social Value: The perceived utility acquired from an alternative’s association with one or more specific social groups.

3. Emotional Value: The perceive utility acquired from an alternative’s capacity to arouse feelings or affective states.

4. Epistemic Value: The perceive utility acquired from an alternative’s capacity to arouse curiosity, provide novelty, or satisfy a desire for knowledge.

5. Conditional Value: The perceived utility acquired by an alternative as the result of the specific situation or set of circumstances facing the choice maker.


Babin, B. J., Darden, W. R., & Griffin, M. (1994)

Two dimensions of value: Utilitarian & Hedonic value

1. Utilitarian value: Utilitarian value incorporates cognitive aspects of attitude, such as economic value for the money and judgments of convenience and time savings (Zeithaml, 1988)

2. Hedonic value: The hedonic dimension is derived from a product’s (or service’s) uniqueness, symbolic meaning, or the emotional arousal it evokes (Holbrook, & Hirchman, 1982).


Butz, H. E., & Goodstein, L. D. (1996)

  • Customer Value: The emotional bond established between a customer and a producer after the customer has used a product or service.
  • Three levels of Customer Value

1. Expected Value: The expected or basic level is the level that is normal to that business or industry. The company provides those goods and services that customers have come to expect.

2. Desired Value: These are features that add value for the customer but simply are not expected because of company or industry standards.

3. Unanticipated Value: The organization finds ways to add value that is beyond the customer’s expectations or even desires, at least on a conscious level.


Oliver, R. L. (1996)

  • Perceived quality- Consumer value – Satisfaction

Quality is precursor to both value and satisfaction.

Value provides additional satisfaction; Satisfaction is derived from both quality and value.






Woodruff, R. B. (1996, 1997)

  • The customer value hierarchy

“Customer value is a customer’s perceived preference for and evaluation of those product attributes, attribute performances, and consequences arising from use that facilitate achieving the customer’s goals and purpose in use situations.”


Customer satisfaction with Received Value

Desired Customer Value

  • Customer Value Hierarchy Model

Customers’ goals and purposes

Goal-based satisfaction

Consequence-based satisfaction

Desired consequences in use situations

Attribute-based satisfaction

Desired product attributes and attribute performances


Sweeney, J. C., & Soutar, G. N. (2001)

The development of multiple item scale to measure perceived value

  • Four dimensions of value

Woodall, T. (2003): Value for the Customer (VC)

  • Five primary VC forms

Balance of benefits and sacrifices

Net VC

Perceived product attributes

Use/experience outcomes





Value for the Customer (VC)

Option determined primarily on price

Monetary difference from objective reference point






Relational interpretation of VC




Net VC

Marketing VC

Rational VC

Derived VC

Aggregated VC

Value for the Customer