Tangible Or Intangible Value? Essay

723 words - 3 pages

In this essay we will discuss the statement: “In a prosperous society, value is predominantly of an intangible nature”. Value is “the sum of the tangible and intangible benefits and costs to customers” (Kotler & Keller, 2012). The question is however if the tangible or intangible benefits and costs are influencing the value of a product the most. This essay will evince that value is mainly of tangible nature.

According to the customer value triad theory by Earl Naumann, “value is a combination of quality, service and price” (Naumann, 1995). In this case quality could be defined as performance quality, the objective quality of a product (Kotler & Keller, 2012). A product with high ...view middle of the document...

For the enthusiastic, practical and cautious consumers, however, were the intangible benefits and costs predominantly the driver of the product’s value. In addition to this, apart from the enthusiastic consumer, all other types of consumers valued functionality more important than the psycho-social nature of the product (Chiang & Yu, 2010). So the quality, which is tangible, is significantly more important than the intangible benefits of the product. From this research we can conclude that the tangible benefits and costs primarily determine the value of the product.

However, according to a study by K.A. Richards and E. Jones, customer relationship management is also an important value driver (Richards & Jones, 2008). This includes customer service, the bond between supplier and customer, and trust. Apparently, intangible benefits are also an important value driver. The question arises then, is the customer relationship management purely tangible? No, because customer relationship management also includes pricing, sales efficiency, and product customization (Richards & Jones, 2008). These value drivers are tangible, which is in conformance our point of view that tangible benefits predominantly determine the value of a product. However, intangible benefits are part of the value too, but they...

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