Value creation goes hand in hand with value capture in understanding the economics of new product development and pricing models. While value capture measures the perceived benefits less price paid from the consumer’s viewpoint, value creation includes the profit a firm incurs by adding value to raw materials to sell a product at a higher price.
Each firm in the value chain will see a different balance of value capture and creation depending on its influence as buyer / seller and other conditions.
For more new product development and project management definitions, please see the NPD Glossary.
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