Final answer:
Customer perceived value is the values mentally assigned by customers to a service provider and their organization based on factors like initial impressions and the quality of service. It is important for businesses as it affects customer satisfaction, loyalty, and profitability.
Step-by-step explanation:
Values mentally assigned by customers to a service provider and his or organization are known as customer perceived value. Customer perceived value is based on a number of factors such as initial impressions and the quality and level of service provided. It involves the customer's subjective evaluation of the benefits and costs associated with a particular product or service.
For example, when a customer visits a restaurant, their perceived value will be influenced by factors such as the ambiance, the quality of the food, the price, and the level of customer service. If the customer has a positive experience and feels that the benefits outweigh the costs, they are likely to assign a higher perceived value to the restaurant and become a loyal customer.
Customer perceived value is important for businesses as it has a direct impact on customer satisfaction, loyalty, and ultimately, profitability. By providing excellent service and meeting or exceeding customer expectations, a business can enhance its perceived value and attract more customers.