2.1.4 Customer expectations
Customer expectations are a measure of the customer's anticipation of the quality of a company's products or services. Expectations represent both prior consumption experience, which includes some non-experiential information like advertising and word-of-mouth, and a forecast of the company's ability to deliver quality in the future.
2.1.5 Perceived value
It is essential to know what consumers value, before one can truly understand purchase intentions and choice.
- What do customers really want from their purchase experiences?
- What attributes are most important in their judgments of value?
- What drives them to use one supplier over another?
This research proposes that the purchase intentions depend on the expectations of value, i.e. a tradeoff between the perceived benefits and costs derived from using certain suppliers for purchasing. The concept of perceived value is chosen, as it represents a customer’s overall assessment of the utility based on perceptions of what is received and what is given (cf. Zeithaml 1988). Perceived value is expected to significantly influence purchase intentions, and by measuring its predictors, it can provide insights in how value is. There are many ways to describe value. Woo (1992) identified four general meanings of value for people;
- First, value is “what is of true worth to people in the broad context of the well-being and survival of individuals, and by extension, of the species as a whole”. Here value is reflected by the values consumers strive for in life, similar to the ‘human values’ of Rokeach (1973).
- Second, it means “what a society collectively sees as important…regardless of whether or not such highly valued objects of consumption really contribute to his or her well-being”. This is a more collective/objective interpretation of value.
- Third, value refers to “what the individual holds to be worthwhile to possess, to strive or exchange for”. In comparison with the second definition, this is more individual and subjective.
- Fourth, value refers to “the amount of utility that consumers see as residing in a particular object and they aim to maximize out of a particular act of buying or consuming.
This last definition refers to the value that is derived from the purchase, consumption and disposition of products and services. This study focuses on the fourth definition. The next section provides a background on four different types of value.