Exploring customer willingness to pay and build value proposition

Georgina Mburu & Jennifer Adhiambo

SECTOR

Inclusive Finance

PROJECT TYPE

Lab experiments

DOI

Location

Kenya

BEHAVIORAL THEME

Mental Accounting

OVERVIEW

This project focuses on understanding customer willingness to pay (WTP) as a means to enhance value propositions for a service provider. The project, conducted in collaboration with Lynk, a digital service platform, aims to shift consumers’ focus from price to perceived benefits. By investigating WTP, the study explores customer valuation and identifies key features that influence consumer preferences.

Lynk’s initiative seeks to create value within their products by deciphering customer WTP. A diverse group of participants from Nairobi were surveyed, using a questionnaire to assess WTP for specific services and Lynk’s value features.

THEMATIC AREAS

The study highlights that quality of materials is the most valued feature across both services, while redo guarantee holds the least importance. For hair braiding, convenience and timeliness are significant, reflecting a preference for home services. For water heater repair, timeliness takes precedence due to scheduling flexibility. The findings underscore the significance of understanding consumer WTP to tailor value propositions effectively.

This exploration into customer WTP unveils the centrality of perceived benefits in product valuation. The study emphasizes the importance of aligning features with customer preferences and provides insights for optimizing value propositions.