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Understanding and Managing Customer Perception

Customer loyalty and customer perception

❶Self perception theory attempts to explain how individuals develop an understanding of the motivations behind their own behavior. We will store data to show you our adverstisement only Ours on other website relevant to vour interest.

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Definition: Customer Perception
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While mass merchandisers such as Wal-Mart emphasize low prices as an inherent virtue, upscale merchants attempt to emphasize quality and value for money to appeal to potential customers. Researchers at the School of Business Administration at LaSalle University and LeBow College of Business at Drexel University considered several factors, including price perception -- whether consumers believed they were being charged fair prices -- in determining whether online shoppers would make repeat purchases through the same website.

The researchers concluded that price perception strongly influenced whether customers were satisfied with their purchases and whether they would make future purchases. Two factors that shaped price perception were the perceived quality of the merchandise or service in question and price comparisons with merchants offering similar merchandise or services. Researchers from Marquette University, Louisiana State University and the University of Arkansas surveyed customers to determine how nutrition claims associated with food affected their perception of that food's nutritional value.

The researchers found that consumers tend to reject general, unsupported claims of enhanced nutrition, especially concerning high nutritional value for foods that are traditionally viewed as unhealthy. The researchers also theorized that consumers would demonstrate a trend toward applying more scrutiny to nutrition claims and would demand more specific information about the foods they purchase.

Chris Blank is an independent writer and research consultant with more than 20 years' experience. Blank specializes in social policy analysis, current events, popular culture and travel. His work has appeared both online and in print publications. He holds a Master of Arts in sociology and a Juris Doctor. Skip to main content. Definition Consumer perception applies the concept of sensory perception to marketing and advertising. Self Perception Self perception theory attempts to explain how individuals develop an understanding of the motivations behind their own behavior.

Price Perception While mass merchandisers such as Wal-Mart emphasize low prices as an inherent virtue, upscale merchants attempt to emphasize quality and value for money to appeal to potential customers. Benefit Perception "It's good, and it's good for you. References 5 Business Dictionary: Customer Perception Marketing Science Institute: Customer Intention to Return Online: Association for Consumer Research: Self-Perception Processes in Consumer Behavior: This relationship is not longer based on features like price and quality alone.

Today it is more the perceived experience a customer makes in his various interactions with a company e. Problems during a single transaction can damage a so far favourable customer perception. The consequence for companies is that they have to adapt their ways of competing for customers. Traditionally, companies have focused their efforts of customer relationship management on issues like customer satisfaction and targeted marketing activities like event marketing, direct marketing or advertising.

Although doubtless necessary and beneficial, these activities are not longer enough. They narrow the relationship between company and customer down to a particular set of contacts in which the company invests its efforts. Most likely this will produce not more than a satisfied customer who is well aware of the companies offerings and has a positive attitude towards them.

However, a satisfied customer is not necessarily a loyal one. If a customer is satisfied that means that a product of service has met his expectations and that he was not dissatisfied by it. Customer satisfaction is doubtlessly very important. It is the precondition for repeat purchases and it prevents the customer from telling others about his disappointing experiences.

A loyal customer, however, is more than a customer who frequently purchases from a company. The difference is the emotional bond which links the customer so closely to the company that he develops a clear preference for these products or brands and is even willing to recommend them to others. Loyal customers truly prefer a product, brand or company over competitive offerings.

Thus loyalty goes beyond a rational decision for known quality or superior price-performance-ratio. When the customer makes his buying decision, he evaluates the benefits he perceives from a particular product and compares them with the costs. The value a customer perceives when buying and using a product or service go beyond usability. There is a set of emotional values as well, such as social status, exclusivity, friendliness and responsiveness or the degree to which personal expectations and preferences are met.

Similarly, the costs perceived by the customer, normally comprise more than the actual price. They also include costs of usage, the lost opportunity to use an other offering, potential switching costs etc. Hence, the customer establishes an equation between perceived benefits and perceived costs of one product and compares this to similar equations of other products.

Based on this, customer loyalty can be understood as to how customers feel about a product, service or brand and whether their perceived total investments with a it live up to their expectations. The important point here is the involvement of feelings, emotions and perceptions. Customer perception is influenced by a variety of factors. Besides the actual outcome — i. Customer perception is dynamic. First of all, with the developing relationship between customer and company, his perceptions of the company and its products or services will change.

The more experience the customer accumulates, the more his perceptions will shift from fact-based judgements to a more general meaning the whole relationship gains for him.

Over time, he puts a stronger focus on the consequence of the product or service consumption. In the external environment, the offerings of competitors, with which a customer compares a product or service will change, thus altering his perception of the best offer around.

Another point is that the public opinion towards certain issues can change. This effect can reach from fashion trends to the public expectation of good corporate citizenship. Shells intention to dump its Brent Spar platform into the ocean significantly altered many customers perception of which company was worth buying fuel from.

Research has been done on the impact of market share on the perceived quality of a product. The concept of customer perception does not only relate to individual customers in consumer markets. It is also valid in business to business situations.

For example, a competitor benchmarking survey of a large industrial supplier revealed that the market leader, although recognised for excellent quality and service and known to be highly innovative, was perceived as arrogant in some regions. If we take into consideration that there are about four other large players with a similar level of quality and innovative ideas, this perceived arrogance could develop into a serious problem.

Customers here are well aware the main characteristics of all the offerings available at the market are largely comparable.

So they might use the development of a new product generation of their own to switch to a supplier that can serve them not better or worse, but with more responsiveness and understanding. Companies have done a lot to improve customer satisfaction and customer relationships in the past.

As discussed above, this will not be enough any more.

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This perception may vary based on the customer or a certain demographic of customer. Customer perception can be developed from a variety of factors, such as their own personal experience or how they have heard other people experienced the product.

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Customer perception definition. The formal definition of customer perception is, “A marketing concept that encompasses a customer’s impression, awareness and/or consciousness about a company or its offerings.” To put it simply, customer perception is what your customers and potential customers think of your organization.

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Customer perception is influenced by a variety of factors. Besides the actual outcome – i.e. did the product or service deliver the expected function and did it fulfil the customers need – the whole process of consumption and all . The perception of the same product or service by different consumers would vary. This is exactly what consumer perception theory analyses by finding out what exactly motivates or influences a consumer behavior in purchasing or not purchasing a specific product.

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Self perception by customers relates to values and motivations that drive buying behavior -- which is also an important aspect of consumer perception theory. For instance, a study by researchers at the University of Massachusetts at Amherst addressed how self perception shaped consumers' buying behavior. Customer satisfaction comes down to the customer’s perception of their experience with your company. If they had an enjoyable shopping experience, if their item was delivered on time, and if their product works and looks as described, they’ll typically perceive the experience as enjoyable.