So I was thinking about perceived value recently. This idea that people attach value to something depending on how it’s presented. It’s why, while I keep this blog on the free & ill designed wordpress site, there will be an automatic reduction in the value attached to these words. And why someone will pay double or triple the price for the same product in different packaging.
Let’s compare two relatively similar products – the Casper Glow Lamp and an amazon comparable. The Casper product has brightness controls, a timed wake-up feature utilized through the Casper app, a charging stand and a 6 month warranty. The amazon competitor has brightness controls, is bigger and lighter. It does not have an app, nor is it clear what the warranty length is.
Casper’s product retails at $129 while the amazon product retails at $19.99. That’s a 6x price difference, without a 6x product quality or benefits difference. The explanation for Casper’s ability to sell at a premium = Perceived Value.
Due to Casper’s extensive, clever marketing campaigns, they have positioned themselves as providers of premium, high-quality products. They cement that image with a high quality website (which is very sleek) and use of buzzwords and marketing strategies like social proof. But ultimately they provide a product not dis-similar to others on the market.
This can be seen time and time again when you look across different industries. What it means for entrepreneurs and businesspeople, is a decision needs to be made about product positioning and pricing.
Unless your perceived value is greater than your cost, your product will be perceived as expensive.
20/20 Hindsight 