How to Increase Perceived Value (and Charge More)
Perception isn’t always the same thing as reality, even when it comes to something as supposedly objective as your product’s value. In fact, the perceived value of your product is fairly malleable. There are countless studies as well as anecdotes that support the notion that you can tweak small things to increase your product’s value perception.
First, what is perceived value? According to BusinessDictionary.com:
“A customer’s opinion of a product’s value to him or her. It may have little or nothing to do with the product’s market price and depends on the product’s ability to satisfy his or her needs or requirements.”
Perceived value also has some interesting interactions with perceived risks, price plasticity, long term satisfaction and loyalty.
The same product can mean different things to different people, and there is no such thing as objective product value, at least when it comes to actually selling products (there are objective costs associated with making the product, of course).
Therefore, we have this huge opportunity to influence how people feel – how they perceive our product’s value – as well as the opportunity to optimise the customer experience in such a way that the customer is delighted, and we maximise our revenue.
One common problem is the relatively ambiguous terms. What’s the difference between price, quality, and value?
Let’s say that perceived value is the consumer’s overall assessment of the utility of a product based on what is received and what is given. This embodies more than just quality, which tends to be more product focuses. Perceived value includes concrete product attributes as well as other high-level abstractions like convenience, perceptions of security, service, and more.
You can increase your product’s perceived value without actually increasing its objective value (costs included in making it)!
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