The assessment of customer value

In the model of the Ecocosts / Value Ratio (EVR), the value is the market value, i.e. the price of the product.
But what is the expected price of a product which is still in the design and development stage? In which niche market?

Different types of assessment
Since the value is determined by the customer, the only way of assessment of future products is to ask the future (potential) customer. There are basically 4 methods, often applied as subsequent steps during the design and development process:
1. Just ask the fair price
  (the fair price is the price at which the customer would consider to buy the product)
This can be done at any place where interested consumers are expected, e.g. exhibitions, fairs, seminars, etc.
2. Ask the preference of a row of products with the same function (including the new product)
  Provide the price of the products and ask the fair price of the new product.
Discuss the results with a consumer panel.
3. Ask a score (1 thru 5) of each quality aspect and ask also the score of its importance (1 tru 5)
  Use the quality dimensions of Garvin as a guideline.
Discuss the results with a consumer panel.
4 Do point 3 also for the product of the competitor and make the analysis of Gale

Market niches and Consumer Market Segmentation
There are many types of consumers:
- poor or rich
- conservative or innovative
- single or married (with or without children)
- age
-etcetera
So it is important to determine the Consumer Market Segment of the product (and/or service) before the vale assessment is done.

The selection of the right Consumer Market Segment is beyond the scope of this website. There is a wide variety of theories about it, but it is good to realise that Consumer Market Segmentation in practice is often done by instinct (entrepreneurship).
A good example of Consumer Market Segmentation is provided in the example for the USA.

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