Identifying competitive customer value propositions in retailing

Abstract

PurposeThe purpose of this paper is to develop a framework for identifying competitive customer value propositions in retailing.Design/methodology/approachThe paper draws on existing literature on customer value and competitive advantage in order to form an understanding of the key dimensions of customer value, developing a hierarchical model of value propositions and establishing a link between customer value and competitive advantage.FindingsThe work suggests a framework for identifying competitive customer value propositions (CVPs) where four hierarchical key dimensions of customer value – economic, functional, emotional, and symbolic – are first identified. In the second stage, a CVP is developed on the basis of these value dimensions. In the third stage, the CVP is evaluated for competitive advantage. It is proposed that economic and also functional CVPs are more likely to represent points of parity, whereas emotional and social CVPs represent points of difference for retail companies seeking differentiation from their competition and gaining of competitive advantage.Originality/valueIdentifying competitive CVPs, the paper combines a hierarchical perspective on customer value and the concept of competitive advantage in a manner that offers managers a strategic positioning tool that links the customer's value needs to company resources and capabilities.