Consumer Value Theory

The theory is based on a notion that value is a personal assessment what consumers received
from purchasing a product. Individuals are making purchases by deciding whether they are
giving up what a consumer is giving up in trade. The stronger the perceived value the more
likelihood of purchasing again in future when need arises. In other word CVT defines why
consumers decides to purchase or not and prefer one product over another based on their
consumption values. If brands do not measure up the likelihood of repurchasing diminishes and
reaches to zero. According to theory, the actual price paid for the product is only the part of the
value equations a consumer cannot obtain a value even when spending ten thousand of dollars.
This theory states that value is difference between the benefits one gains minus the overall cost
one incurs in the decisions we make are made mostly based on the choices of how well our
choices are deliver the highest level of value. The proposed theory is based on three main
assumptions related to consumers choice including multiple consumption value, Independency of
consumption value, and Differential contribution in any circumstances.
This theory is purely developed in consumer behavior context. Marketing practitioners must
understand what drives consumer value and this framework good representation of consumer
behavior theory is because it illustrates values that shapes people consumption behavior. Some of
the major consumption values that aids in decision making including function value, conditional
value, social value, epistemic value, and emotional value.
According to CVT, consumers differ based on what they value for instance consumers buy
groceries from Walmart instead of their competitors because the total benefits people are getting
more than the price they are paying for the groceries. However, retail food stores there are
various shopping channels that consumers use for purchasing grocery such as supermarkets
(Publix), groceries i.e., Whole Food, a super seller i.e. (Walmart), club stores i.e., Costco or
convenience stores i.e., Parkers. All these choices what determines from which store a
consumer’s shops. Location, store aesthetic, price selection and quality are key factors in one’s
decision. For some consumers fresh organic food matters more so these consumers will prefer to
buy from groceries. If this location is less convenient and prices are higher than competing retails
for this consumer’s segment product quality far outweigh product cost, they will prefer to buy
from supermarkets such as Walmart to buy at affordable prices.
References
Sheth, Jagdish & Newman, B. & Gross, Barbara. (1991). Consumption Values and Market
Choices: Theory and Applications.
Tanrikulu, C. Theory of consumption values in consumer behaviour research: A review and
future research agenda. Int J Consum Stud. 2021; 00: 1– 22. https://doi.org/10.1111/ijcs.12687