MCEV Lecture 1 Summary – Customer
Experience and Customer Value
The Evolution of Marketing (Marketing Concepts Over
Time)
Concept Focus Timeline
Efficient production
Production concept < 1930
(higher demand then availability)
Product concept Product improvements 1930–1950
Selling concept Pushing to increase sales 1950–1990
Marketing concept Meeting needs of groups >1990
Customer concept
Meeting needs of individuals Present
(= focus of MCEV)
From inside-out to outside-in perspective
Strategic marketing is shifting from an inside-out perspective (product-
driven) to an outside-in perspective (customer-driven). “How can I make
the most out of the customer, not the product?”
Why This Shift Happened: Changing Market Landscape
More diverse & fragmented markets
Shorter product lifecycles
Increased competition and customer expectations
Lower loyalty
Social media gives customers more power
Easy access to information
Rise in customer-firm & customer-customer interactions
Your notes: Social media makes interaction fast. Firms must build
relationships, not just “send and hope.”
Evolution of Customer-Firm Interaction
Period Interaction Example Explanation
Company sends,
One-way (firm → TV ads, flyers (=
<1990 consumer chooses to
customer) traditional marketing)
respond, or not
Email, direct marketing Start building a
1990–2005 Two-way (= Customer relationship relationship beyond send
mgmt.) and respond
Social media, Can be much quicker
Multi-directional (firm ↔
>2005 communities (= than before (social
customer ↔ customer)
engagement) media
“Beyond respond and send” → now firms and customers build ongoing
relationships.
1
, Focus of This Course: Customer-Centric Marketing
Not about selling products, but creating dual value:
o For the customer (V2C)
o For the firm (V2F)
Based on Shah et al. (2006): creating value for customers creates
value for the firm.
Works best when both sides benefit.
“Value creation must go both ways Dual value creation”
Market orientation = serve to whoever will buy
Customer orientation = create value for the customer
Core Concepts: V2C & V2F
V2C= The Value that the firm delivers to the Customer = relationship with
the firm and the brand. Measure with customer satisfaction or the Net
Promotor Score.
V2F= The Value that the customer delivers to the Firm. Measure with
Lifetime value (revenue/retention) or Customer equity)
Best if they align
Type Meaning Metrics
V2C (Value to
What the customer perceives they get Satisfaction, NPS
Customer)
V2F (Value to What the firm gains from the CLV, Customer
Firm) customer Equity
“What do you offer the customer?” vs. “What does this customer bring
us?”
V2C – Value to the Customer
Customers assess:
o Product/service value
o Relationship value
o Brand value
Defined by perceived benefits minus perceived costs
o Costs = money + time + stress + effort
Competing offers impact this perception
Perceived value is subjective and includes emotional/stress costs.
V2F – Value to the Firm
Financial value:
o Customer Lifetime Value (CLV) → Lecture 3
o Customer Equity
Engagement value:
o Recommendations, social media influence → Lecture 4
Varies per individual:
o Some customers bring a lot of value…
o …others are costly (e.g., constant complaints)
2
Experience and Customer Value
The Evolution of Marketing (Marketing Concepts Over
Time)
Concept Focus Timeline
Efficient production
Production concept < 1930
(higher demand then availability)
Product concept Product improvements 1930–1950
Selling concept Pushing to increase sales 1950–1990
Marketing concept Meeting needs of groups >1990
Customer concept
Meeting needs of individuals Present
(= focus of MCEV)
From inside-out to outside-in perspective
Strategic marketing is shifting from an inside-out perspective (product-
driven) to an outside-in perspective (customer-driven). “How can I make
the most out of the customer, not the product?”
Why This Shift Happened: Changing Market Landscape
More diverse & fragmented markets
Shorter product lifecycles
Increased competition and customer expectations
Lower loyalty
Social media gives customers more power
Easy access to information
Rise in customer-firm & customer-customer interactions
Your notes: Social media makes interaction fast. Firms must build
relationships, not just “send and hope.”
Evolution of Customer-Firm Interaction
Period Interaction Example Explanation
Company sends,
One-way (firm → TV ads, flyers (=
<1990 consumer chooses to
customer) traditional marketing)
respond, or not
Email, direct marketing Start building a
1990–2005 Two-way (= Customer relationship relationship beyond send
mgmt.) and respond
Social media, Can be much quicker
Multi-directional (firm ↔
>2005 communities (= than before (social
customer ↔ customer)
engagement) media
“Beyond respond and send” → now firms and customers build ongoing
relationships.
1
, Focus of This Course: Customer-Centric Marketing
Not about selling products, but creating dual value:
o For the customer (V2C)
o For the firm (V2F)
Based on Shah et al. (2006): creating value for customers creates
value for the firm.
Works best when both sides benefit.
“Value creation must go both ways Dual value creation”
Market orientation = serve to whoever will buy
Customer orientation = create value for the customer
Core Concepts: V2C & V2F
V2C= The Value that the firm delivers to the Customer = relationship with
the firm and the brand. Measure with customer satisfaction or the Net
Promotor Score.
V2F= The Value that the customer delivers to the Firm. Measure with
Lifetime value (revenue/retention) or Customer equity)
Best if they align
Type Meaning Metrics
V2C (Value to
What the customer perceives they get Satisfaction, NPS
Customer)
V2F (Value to What the firm gains from the CLV, Customer
Firm) customer Equity
“What do you offer the customer?” vs. “What does this customer bring
us?”
V2C – Value to the Customer
Customers assess:
o Product/service value
o Relationship value
o Brand value
Defined by perceived benefits minus perceived costs
o Costs = money + time + stress + effort
Competing offers impact this perception
Perceived value is subjective and includes emotional/stress costs.
V2F – Value to the Firm
Financial value:
o Customer Lifetime Value (CLV) → Lecture 3
o Customer Equity
Engagement value:
o Recommendations, social media influence → Lecture 4
Varies per individual:
o Some customers bring a lot of value…
o …others are costly (e.g., constant complaints)
2
