The concept of customer value is very relevant to companies for a number of reasons. First of all, management in food and beverage companies can be considered as providing value to customers. That basically means analyzing what kind of value customers want, creating this value, and delivering this value to consumers. Basically the point is from customer value one fundamental concept for companies that can be derived is value proposition. What is a value proposition? Actually, every company sells a value proposition into a market. That is a specific combination of benefits and sacrifices that the company wants to give to its customers. Every product is a potential combination of benefits and by definition every product category is able to provide consumers with all kinds of benefits: functional, symbolical, experiential, social, and psychological. But my specific company can decide to provide a specific value proposition, a specific combination of some benefits which are related to some sacrifices. This value proposition should be different from my competitors’ one in order to get a competitive advantage. So basically what is important to understand for companies is that companies do not compete in markets with products and services, they compete with value propositions. A value proposition is a combination of specific benefits and specific sacrifices. The point is, what is the role played by the product within the value proposition? The product is one component of the value proposition because the product is able to provide some benefits, but not all benefits are provided by the product. If we think, for example, that a typical function benefit is the availability of the product this has to very much to do with the distribution of the product not with the product features itself. If we think of the convenience, again, we go to the distribution, so the fact that it is very easy for consumers to find the product and buy it. For example, if we think of the image of the value proposition it could be related to the price, a high price gives the product image. As you see, the value proposition is made by different components, and all these components together make the value for the customer. The point is not to focus too much attention on the product, but to move the attention to the overall value proposition. Companies compete in markets with value propositions. If we go back for a while to the concept of customer value we can consider other reasons why this concept is relevant. One of the most important ones is that we consumers have two different concepts of customer value. One is expected value and the second one is perceived value. Expected value and perceived value are very different concepts. They are different because the determinants of these two constructs for consumers are very different. Expected value is expectations, so consumers expect something, then we buy, we consume, and then we get something from the product and service, so we perceive some value. The point is that a company should consider the two together. I mean a company should have knowledge of the expectations of consumers and what are the perceptions that consumers have after having bought and consumed the product. The point is what are the determinants of expected value? What influences us consumers before we buy a product or service? Basically we consumers are influenced by two different things: why we buy and what we know. Basically what we want to get out of a product or service and what is our knowledge when we go and buy it. These are motivations and knowledge (respectively). From my experience, companies give an extremely focused importance on motivations, to try to understand why consumers consume basically, and they tend to give less emphasis to knowledge. But actually we must be very aware of the fact that different consumers have different expectations because they have different knowledge. There is this tendency in food and beverage businesses to overestimate consumer knowledge. When I talk to managers and entrepreneurs they tend to think that consumers have a lot of knowledge. They are experts and connoisseurs; but this is not the case. The majority of consumers have a very limited knowledge of products and services. The point is, how can I leverage on this knowledge? Well if I'm able, as a company, to know and understand what are the expectations, the motivations, the “why” consumers buy, and what is the knowledge consumers have, I can define and define and design a value proposition which is better able to meet consumers' expectations. What about perceived value? We said perceived value is the value consumers get out of the consumption of the product or service. The determinants of this perceived value are different from the determinants of the expected value. Basically, there are two big classes of determinants. The first one is the experience. I try to understand if I got some value linked to the experience I've had. The experience of the consumer with the product and/or service is one of the main determinants of the perceived value. Then again, there is knowledge: knowledge linked to the purchase process, knowledge linked to the consumption process. Again, if some consumers have limited knowledge of how to consume a product the effect will be a likely decrease of perceived value. It’s not because the product itself has something wrong but because consumers do not have the appropriate knowledge to consume the product or the service properly. In the end, these two main concepts are fundamental for the consumer for one simple reason: Expected values and perceived values combine together to give customer satisfaction. Customer satisfaction is basically the result or outcome of a comparison of the perceived value with the expected value. Obviously this comparison is very frequently subconscious. Consumers do it without thinking about it but the real point is we consumers are satisfied when what we perceive at the end of the consumption process, basically the benefits that we perceive to get combined with the sacrifices that we’ve made, are higher than the expectations or are aligned with the expectations. If us consumers perceive to have got a value which is less than that of what we expected we are dissatisfied. The fundamental concept of customer satisfaction derives from expected value and perceived value. That's why companies need to know very well, what are the expectations, what are the perceptions, what are the determinants of these protections, what are determinants of the perceptions because this is the only way to anticipate if consumers could be satisfied or dissatisfied, and afterwards to manage consumer satisfaction or consumer dissatisfaction.