{"id":14577,"date":"2019-12-08T10:13:50","date_gmt":"2019-12-08T10:13:50","guid":{"rendered":"http:\/\/adaml53.sg-host.com\/?p=14577"},"modified":"2019-12-08T10:13:50","modified_gmt":"2019-12-08T10:13:50","slug":"customer-perception-of-value","status":"publish","type":"post","link":"https:\/\/mk.pnkdesign.co.uk\/verri\/2019\/12\/08\/customer-perception-of-value\/","title":{"rendered":"Customer perception of value"},"content":{"rendered":"\n

As a business owner, you will have to consider what price you put on your services or products. What is the customer perception of value?

This is an area that many struggle<\/g> with. They recognise what their clients or customers need, they do not have the experience to understand what they should charge.
Today we will examine some recent studies that take a psychological viewpoint of this aspect of marketing. Hopefully that you will be somewhat better placed in how to price your own merchandise after reading.<\/a><\/p>\n\n\n\n

Comparative pricing is not always ideal. <\/strong><\/h3>\n\n\n\n

One of the very first steps that many business owners take is to exactly\nliken prices with that of a competitor. From here they usually undercut the\ncompetition and release something that looks like \u201820% cheaper than XYZ brand\u2019.<\/p>\n\n\n\n

The issue with this is comparative pricing is not as dependable as people believe<\/strong>. Therefore, it can harm your brand and alter potential customers\u2019 opinion of the product in several ways.<\/p>\n\n\n\n

Let\u2019s consider this scenario.<\/p>\n\n\n\n

You walk into a pharmacy and there is a poster asking you to try their brand\nof paracetamol, instead of a well-known brand.<\/p>\n\n\n\n

Would you try the own brand?<\/strong>
\nAccording to studies you may not go for the cheapest, as it can be perceived as\na \u2018risky\u2019 choice.
\nWill it work as well? Will it work as quickly?<\/p>\n\n\n\n

Confusion could mean some will leave with nothing at all. Research has\nrevealed that asking\nconsumers to directly compare prices<\/a> may have unintentional negative\neffects.<\/p>\n\n\n\n

Offering a lower priced alternative in some markets can cause the consumer\nto question the quality of the item or service being offered. This causes them\nto by nothing due to a supposed increased risk.<\/h4>\n\n\n\n

To assess the consequences of comparative advertising a test was carried out\nrevolving around selling CD\u2019s on eBay.<\/p>\n\n\n\n

The researchers sold a few top selling albums and started the sale at $1.99.\nThis CD was then \u2018flanked\u2019 with two CD\u2019s that started at 99 cents.
\nThe second listing had flanked the CD with two copies starting at seven\ndollars.<\/p>\n\n\n\n

Time and time again the more expensive CDs ended up fetching a higher\nselling price than the 99 cents option although the item sold was completely\nidentical in every other way. <\/p>\n\n\n\n

It is clear the buyers felt that by paying less they were purchasing an\ninferior product.
\nSo next time you consider competing on price remember this study. You may well\nbenefit from explaining how your product is better rather than talking about\ncost.<\/p>\n\n\n\n

Now let\u2019s consider how consumers value time. According to new research \u201cselling time\u201d over money<\/a> could be the way forward.<\/p>\n\n\n\n

According to the General Atlantic Professor of Marketing at Stanford School of business, our experience with a product quickly promotes mindsets of personal nature<\/strong> in which we feel a connection, therefore refer<\/a>ring to time in our marketing quickly leads to positive stances and more purchases.<\/p>\n\n\n\n

So why would\nselling time do so much better than saving money?<\/h3>\n\n\n\n

In an experiment\naddressing this<\/a>,<\/strong> a lemonade stand was set up, with two small\nchildren in situ so it would look realistic. For the purposes of the experiment\nthe stand had three signs displaying the following messages:<\/p>\n\n\n\n

  1. \u201cSpend a little time and enjoy C&D\u2019s lemonade\u201d<\/li>
  2. \u201cSpend a little money and enjoy C&D\u2019s lemonade\u201d<\/li>
  3. \u201cEnjoy C&D\u2019s lemonade\u201d (neutral sign)<\/li><\/ol>\n\n\n\n

    The customer could\nchoose how much to pay for the lemonade, providing it was between $1 and $3.<\/p>\n\n\n\n

    Even using a\nsimple children\u2019s stand the results were clear. The sign that alluded to time\nattracted twice as many customers who were willing to pay twice as much for the\nproduct.<\/p>\n\n\n\n

    To ensure the\ntest was fair and was not biased because children were involved (i.e the cute\ncard was played) the test was repeated<\/strong> using students and iPods.<\/p>\n\n\n\n

    This time the\ntest was made up of two questions.<\/h4>\n\n\n\n
    1. \u201cHow much money have you spent on your iPod?\u201d<\/li>
    2. \u201cHow much time have you spent on your iPod?\u201d<\/li><\/ol>\n\n\n\n

      Considering\nthe results of the previous test it will be no surprise that students reacted\nmuch more favourably towards the time question.<\/p>\n\n\n\n

      Not content\nwith this a third study was carried out,<\/strong> this time using a concert. The\ngig itself was completely free, but the cost was time. If you wanted to go in\nyou had to wait in a queue.<\/p>\n\n\n\n

      The questions\nput forward in this situation were:<\/p>\n\n\n\n

      1. \u201cHow much time will you have spent to see the concert today?\u201d<\/li>
      2. \u201cHow much money will you have spent to see the concert today?\u201d<\/li><\/ol>\n\n\n\n

        Even when\nplaced in this setting, where time was the expense, asking about time increased\npositive attitudes about the show.<\/p>\n\n\n\n

        So does this\nmean our relationship with time is more important that that with money?<\/strong> I would say\nyes, after all, every second that passes is a moment lost, whereas we always\nhave the opportunity to earn money back. As people, how we spend time says so\nmuch more about us than how we spend our money.<\/p>\n\n\n\n

        The marketing profession as a whole <\/a>needs to come to realise that the meaning behind services and products are more important than the cost, in the most part.<\/p>\n\n\n\n

        There appears\nto be one exception to the rule<\/strong> – prestigious products. Consumers who buy\nexpensive luxury items such as sports cars and designer watches seem to value\nthe product and how they feel it reflects on them for owning it rather than the\ntime spent with the item itself.<\/p>\n\n\n\n

        So\nwhen you next sell a product, factor in time, it seems to make all the\ndifference!<\/p>\n\n\n\n

        So how about price points?<\/strong><\/h3>\n\n\n\n

        When pricing your products, you will find that the difference in price\nbetween products will significantly affect the value your customer feels they\nare receiving.<\/p>\n\n\n\n

        A study was carried out whereby it was noted that there appeared to be three\nvery strange price points:<\/p>\n\n\n\n

        Product One is a web-only subscription for $<\/p>\n\n\n\n

        Two is a print-only subscription for $125<\/p>\n\n\n\n

        Three is a web and print subscription for $125<\/p>\n\n\n\n

        Obviously, this is entirely nonsensical as no-one would buy product two when\nthey can get product three for the same price, surely?
        \nThis is an         interesting\nstudy<\/a> that assesses what would transpire should product two be removed.<\/p>\n\n\n\n

        The findings showed that product two, although outwardly of no use as it\noffered no worth was really valuable<\/strong>.
        \nWhy? It ensured that potential customers stopped looking for the cheapest\noption and instead looked for value.<\/p>\n\n\n\n

        Customers were looking at the prices and naturally comparing product two and\nthree which was making product three look like a fantastic deal.
        \nIf product two was removed the jump between the two prices was too large, so\ncustomers would look at the product and decide they didn\u2019t need to upgrade.\nEveryone started looking at going \u2018cheap\u2019 –  not the type of customers you\nare looking for. <\/p>\n\n\n\n

        However, with product two in place almost everyone feels like they are\ngetting real value for money which means many upgrade, even if they don\u2019t\nreally need it! They feel that the premium price is justified as they are\ngetting much more value.<\/p>\n\n\n\n

        With 2020 just around the corner you may well be doing what I have this\nweek\u2026 working out forecasts and budgets. With the average digital marketing budget\nset to increase by 4.3% next year, perhaps you need to get ahead of the game?<\/p>\n\n\n\n

        Keep reading to see our predictions for the New Year and how you should\ninvest:<\/h3>\n\n\n\n

        Content is (still) king.<\/strong>
        As Google proves itself time and time again when connecting search enquires, we still maintain that y        ou should be investing in content marketing.<\/a> By educating your target market now, you will reap the rewards in the future.<\/p>\n\n\n\n

        Let\u2019s get video.<\/strong>Video is going to get even bigger. Essentially everyone wants to make a\nvideo that will go viral, so expect even more high quality, interesting videos\ncoming to light.<\/p>\n\n\n\n

        Get Freudian.<\/strong>
        \nMarketing gurus with a background in psychology will be the only people that\nmatter\u2026 tell your father that!<\/p>\n\n\n\n

        A running topic through the prophecies above is the increase of the\nup-to-date tech-savvy customer. Should the above predictions come to fruition\nthe emphasis will lay on companies to take customers demands seriously and\nconfirm their business is set up to meet or exceed expectations.<\/p>\n\n\n\n

        Those that accomplish this this will profit from excellent brand\nawareness, better-quality customer conversions and augmented customer loyalty.<\/p>\n\n\n\n

        If you need a hand with your 2020 digital marketing plan, don’t panic, just get in touch today.<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

        As a business owner, you will have to consider what price you put on your services or products. What is the customer perception of value? This is an area that many struggle with. They recognise what their clients or customers need, they do not have…<\/p>\n","protected":false},"author":3,"featured_media":7835,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_et_pb_use_builder":"","_et_pb_old_content":"","_et_gb_content_width":"","content-type":"","footnotes":""},"categories":[113,145],"tags":[178,180,164,165],"class_list":["post-14577","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-blog","category-psychology","tag-b2b-content-marketing-agency","tag-content-marketing-agency","tag-psychology-and-marketing","tag-psychology-and-pr"],"_links":{"self":[{"href":"https:\/\/mk.pnkdesign.co.uk\/verri\/wp-json\/wp\/v2\/posts\/14577","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/mk.pnkdesign.co.uk\/verri\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/mk.pnkdesign.co.uk\/verri\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/mk.pnkdesign.co.uk\/verri\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/mk.pnkdesign.co.uk\/verri\/wp-json\/wp\/v2\/comments?post=14577"}],"version-history":[{"count":0,"href":"https:\/\/mk.pnkdesign.co.uk\/verri\/wp-json\/wp\/v2\/posts\/14577\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/mk.pnkdesign.co.uk\/verri\/wp-json\/"}],"wp:attachment":[{"href":"https:\/\/mk.pnkdesign.co.uk\/verri\/wp-json\/wp\/v2\/media?parent=14577"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/mk.pnkdesign.co.uk\/verri\/wp-json\/wp\/v2\/categories?post=14577"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/mk.pnkdesign.co.uk\/verri\/wp-json\/wp\/v2\/tags?post=14577"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}