1. Describe the Consumer Value Framework (CVF), including its basic components.

The Consumer Value Framework mainly depict consumer behavior theory illustrating factors that
shape behaviors that are related to consumption and ultimately determine the value associated
with consumption. Value results from the consumption process, which represents the decision-
making process of consumers seeking value. It’s basic components are (1) Internal influences
like consumer psychology: learning, perception and memory, as well as personality of consumer:
motivation, lifestyle and personal values. (2) External influences which include social
environment: social class, family influence and reference groups, as well as situational
influences: atmospherics, time and conditions. Lastly, (3) Consumption process such as needs,
wants, exchange, cost and benefits and reactions.

2. Define consumer value, and compare and contrast utilitarian value and hedonic
value. Describe two situations--one in which you received utilitarian value and the
other in which you experienced hedonic value. Which made you more satisfied?
Explain why.

Consumer value is the satisfaction a customer feels after making a purchase for goods or
services relative to what she must give up to receive them. It is the perception of what a
product or service is worth to a consumer versus the possible alternatives.

Utilitarian Value is gained from a product or service that helps the consumer solve problems
and accomplish tasks. When utilitarian value is the primary motive, consumers usually offer a
rational explanation of why something is purchased. It may be most relevant in explaining
shopping trips described by consumers as an errand or work.

Hedonic Value is the immediate gratification that comes from experiencing some activity. It is
more subjective and personal. It reflects shopping’s potential entertainment and emotional
worth. With hedonic value, the value received is provided entirely from the actual experience
and emotions associated with consumption, not because some other end is or will be
accomplished.

As a consumer, when I received a utilitarian value such as foods and drinks, basic necessities
for sanitation, healthcare and the like. I honestly felt more satisfied and secured rather than the
time I received a hedonic value such as iPhones and jewelries. It is because with or without
these hedonic values that I have, I know I got what truly matters most in a practical life.

3. Define market segmentation and explain how it is a marketplace condition. Describe

different market segments of McDonald’s customers.

Segmentation helps marketers to be more efficient in terms of time, money and other
resources. Market segmentation allows companies to learn about their customers. They gain a
better understanding of customer's needs and wants and therefore can tailor campaigns to
customer segments most likely to purchase products Market segmentation is a marketplace
condition; numerous segments exist in some markets, but very few segments may exist in others.

Type of Segmentation McDonald’s target segment

segmentation criteria
Region Domestic/international
Geographic Density Urban/rural
Age 8 – 45
Demographic Gender Males & Females
Life-cycle stage Bachelor Stage: young, single people not living at home
Newly Married Couples: young, no children
Full Nest II: youngest child six or over
Income Low and middle
Occupation Students, employees, professionals
Behavioral Degree of loyalty ‘Hard core loyals’ and ‘Switchers’
Benefits sought Cost benefits, time efficiency
Personality Easygoing & careless
User status Potential and regular fast food eaters
Psychographic Social class Lower, working and middle classes
Lifestyle McDonald’s targets Resigned, Struggler and Mainstreamer
individuals according to Cross Cultural Consumer Characterization
developed by Young & Rubican

Source of Mcdonald’s Market Segment: https://research-methodology.net/mcdonalds-

segmentation-targeting-and-positioning/