Essay about Creating customer value - Case study: Thorntons

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ASSIGNMENT:
HOW THORNTONS IS CREATING CONSUMER VALUE CONSIDERING THE PERCEIVED BENEFIT VERSUS THE PERCEIVED SACRIFICE

This report aims to analyse Thorntons, a large multi-channel chocolate maker/confectionary retailer, and how it provides customer value. Jobber (2013) suggests that the value placed on a product by a consumer solely depends on the perceived benefits of buying the product and the perceived sacrifice that is allied with the product’s purchase.
Perceived benefits
Prior to purchasing a product, consumers weigh the benefit of owning the product. The several sources of benefit a customer can get from purchasing a product are product benefit, service benefit, relational benefit and image benefits.
Product benefits
Thorntons has a range of products to suit different consumer needs. Thorntons ensures that their product range includes different luxurious flavours, tastes and textures: From milk to white to dark chocolates, pralines, truffles, fudge and even customise chocolate gift boxes (Thorntons, 2013a). Therefore, consumers buying from Thorntons would benefit from the various range/selection of products that may meet their needs.

In addition, according to Mintel (2010a), due to the economic downturn, over half of all consumers prefer and consider confectionary boxes and gift sets as a cost effective gift to the traditional gifts ideas. Thorntons engages in providing consumers with ready gift packs to meet gender and occasion/holiday needs. They also offer consumers the choice of personalised gift set.
Service benefit Anderson and Fornell (1994) claims that when a company provides top quality services to its customers it enhances the consumers’ willingness to buy again, to buy more and to buy other services without considering the monetary cost. Thorntons ensures that they continuously train the employees to give high standard services. Thorntons also believes in giving back to their employees through incentives, benefits and bonuses (Thorntons, 2013b), which in turn will motivate their employees to perform at high standards.
Relational benefit
Adding to the point made above, the relationship a company shares with its consumers can impact on customer retention. Thorntons has invested in their pre purchase as well as post purchase customer service/relationship. Through the use of customer surveys, and their ‘Customers Contact Centre’ they are able to keep in contact with their customers after product purchase. This gives customers the notion of consumer value.
Image benefit
Mintel’s (2013a) market research illustrates that consumers have high regards for companies who ethically source their products (raw materials); hence consumers are willing to pay more for them. Thorntons may not use fair trade as a way to source out their cocoa unlike their competitors; however they do engaged in looking after their community through their packaging and recycling programme and their energy saving programme; this has allowed Thorntons to save over 1.8million kWh and all most 1,000 tonnes of CO2, and many more (Thorntons, 2013b). This ensures their customers that Thorntons’ Corporate Social Responsibilities are just as important as its company’s profits.

In addition, chocolate confectionary consumers see Thorntons as a luxurious, special and upmarket brand (Mintel, 2013b). Mintel (2010b) primary research illustrates that consumers will pay extra for Thorntons products as “they are so worth it”. Therefore, consumers may be willing to pay more for Thorntons products due to the positive reinforcement received by others.

Perceived Sacrifice
This looks at the perceived price /sacrifice of acquiring a product.
Monetary cost
Although Thorntons products, which ranges from £5- 0ver £30; are more expensive than the less luxurious brands such as Kit Kat, Sneakers, Milky bar, with products prices ranging from £1-£2; however, market research suggests that consumers will pay that little extra for
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