Customer Value

Customer Value and the Value Hierarchy

The value hierarchy is a multilevel representation of how customers deal with products and services in more depth and at greater levels of abstraction. Three levels of the hierarchy exist: attributes, consequences, and values or desired end states. These are interconnected such that the lower levels are the means by which the ends or the higher levels are achieved. At the base of the hierarchy are those attributes or features that the customer immediately perceives on thinking of a product or service. These are the elements that are most objectively defined, what is at the “top of the mind.” In an outpatient clinic, for example, patients who are customers of the clinic might indicate that they are seeking friendly staff, short waiting room time, efficient appointment scheduling, and knowledgeable physicians and support personnel—all concrete features, components, or characteristics that are being sought. No matter what the customer constituency, the first value dimension that occurs to a customer is usually at the attribute level.

Beyond attributes, however, are higher levels of value dimension, which give a more in-depth perspective on how products or services relate to customers but which also tend to be more abstract in nature. Above the basic attributes in the value hierarchy is the consequence level, which characterizes the product or service interaction with the customer. Consequences are, in fact, logical extensions of attributes and are thus higher-order value dimensions. They represent the customer's subjective opinion of what the product or service does for them in terms of both benefits and costs. Patients who indicate that a knowledgeable physician is an attribute/feature that they want in an outpatient clinic might have as higher-level value dimensions the consequences that they want to have confidence that the treatment recommended will be beneficial, that it will ameliorate their medical conditions, and that it will be covered by their medical insurance.

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