Smith

Functional/Instrumental Value

• Aspect: Reference Correct/accurate attributes: Woodruff (1997)

• Appropriate performances: Woodruff (1997)

• Appropriate outcomes: Woodruff (1997)

Related Concepts:

• Functional value: Sheth, Newman, and Gross (1991)

• Use value: Woodall (2003)

• Utilitarian value: Woodall (2003)

• Practical value: De Ruyter and Bloemer (1999)

• Material value: Richins (1994)

Sources of Value:

• Information: Correct/accurate attributes

• Supplier know-how: Ulaga (2003)

• Products:

  • Excellence: Holbrook (1999; 2005)

  • Product quality: Ulaga (2003)

  • Quality: Woodall (2003)

  • Customization: Woodall (2003)

  • Product characteristics: Woodall (2003)

  • Aesthetics: Holbrook (2005), Walters and Lancaster (1999)

  • Flexibility: Lapierre (2000)

• Appropriate performances:

  • Efficiency: Holbrook (1999; 2005), Möller and Törrönen (2003)

  • Performance quality: Woodall (2003)

  • Reliability: Lapierre (2000)

  • Value of core service: Liu, Leach, and Bernhardt (2005)

• Appropriate outcomes:

  • Effectiveness: Möller and Törrönen (2003)

  • Volume: Walter et al. (2003)

  • Safeguards, security: Walter et al. (2003), Woodall (2003)

  • Operational benefits: Woodall (2003)

  • Financial benefits: Woodall (2003)

Experiential/Hedonic Value

• Literature Value Aspect:

  • Sensory value

  • Emotional value: Sheth, Newman, and Gross (1991)

  • Social/relational value: Sheth, Newman, and Gross (1991)

  • Epistemic value: Sheth, Newman, and Gross (1991)

Sources of Value:

• Information: sensory, emotional, social/relational, epistemic value

• Products:

  • Aesthetics: Holbrook (1999; 2005)

  • Emotional value: Play and enjoyment: Woodall (2003)

  • Affective arousal and humor: Woodall (2003)

• Interactions: Trust and solidarity: Lapierre (2000)

• Environment: All mentioned values apply to interaction environments.

Cost/Sacrifice Value

• Literature Value Aspect:

  • Economic costs: Walter et al. (2003)

  • Psychological costs: Woodall (2003)

  • Personal investment

  • Risk: Grönroos (1997), Sweeny, Soutar, and Johnson (1999)

Sources of Value:

• Information: Economic, psychological costs, learning costs

• Products:

  • Economic costs (price, operating, delivery, training)

  • Psychological costs related to convenience and cognitive stress

• Environment: All costs are relevant in this context.

Symbolic/Expressive Value

• Products can serve as symbols of personal identity or social status, often linked to luxury brands or culturally significant items. This value aspect emphasizes how products reflect consumer identity and can enhance self-esteem through association with status or cultural values. Brands that successfully embed these values tend to have strong emotional bonds with their consumers, reinforcing brand loyalty and consumer engagement.

Sources of Value

• Cultural Context: Understanding how certain products symbolize status in different cultures can enhance marketing strategies.

• Identity Projection: Products can allow consumers to project their identities and personal values, making choices that resonate personally, emotionally, and socially with their surroundings.

Framework Application

• Describes marketing strategy: Enhances product specifications, identifies value opportunities, and develops customer value measures across functional, experiential, symbolic, and economic domains.

• Marketing Strategy: Different organizations adopt various strategies based on the type of value they create:

  • Product Leadership: Focus on functional/instrumental value (e.g., 3M, Volvo).

  • Customer Responsiveness: Focus on experiential value (e.g., Club Med, Disney).

  • Brand Image: Focus on symbolic/expressive value (e.g., The Body Shop, Lexus).

  • Operational Excellence: Focus on cost/sacrifice value (e.g., Wal-Mart, Amazon).

• Positioning and Product Concepts: Illustrates how to document and assess product strategies and organizational breadth of value creation (e.g., Starbucks strategy covering all value types).