Yep, you heard me right… When was the last time you savoured that feeling the bum on the side of the road gave you when he indulged you with his smile? If you’re like most people, then it probably didn’t affect you, did it? Well, that’s what I’m talking about. Do you think he has much in the way of value? Do you think he is able to give you what you want? Nope, and you know what? They can’t be truly generous to most people because they’re often financially and emotionally poor. Believe it or not this is a concept which many small businesses don’t realize and due to this, it could be losing them thousands of dollars in profits…
Have you ever heard someone say to you, “I want to make a business which sells the most valuable goods at the cheapest prices – That will make EVERYONE buy from me!†Now, in theory this should work but in practice, competing on price will literally kill your profits and your brand value. Allow me to give you an example:
Make em’ work for it
At the beginning of the year a friend of mine, knowing that I love marketing, lent me some books. Actually, “some books†would probably be an understatement, therefore because I had so many of these books which were lent to me for free I didn’t value them enough to invest my time into reading them. Yeah, I could have knuckled down and churned through the lot of them – but they had no value to me because they were so easy to obtain and they were aplenty.
On the other hand, a few weeks ago I bought a CD off the Internet (more marketing stuff 
) and because I spent a lot of money on it, I really dug into it – I really HAD to get my “Value for moneyâ€. Now for that, I’m thankful. Not for the fact that I’m 200 dollars out of pocket but for the fact that due to the price I paid to obtain the product I valued it so much more then the 200 dollars I spent. So what’s at work in the customer’s mind here?
Consumer Conundrums
Often when consumers make a complex decision to buy something, they have to look beyond the product to make assumptions about the quality of the product and the value it will offer them. So there they are, making judgments on the packaging, whether other people recommended it, if it’s produced by a leading brand, if it’s priced according to the value it promises and so on and so forth. In fact there are so many variables to consider, consumers make a good deal of their judgments based on their emotions – especially for complex, low involvement purchases like clothes, food, phones and books.
It doesn’t hurt to be a little greedy or cocky…
Now, the moral to this story is that if you have a good product – Tell people about it. Price it as you preach it. Or at the very least, make it as if they’ve earned it. Ultimately, by offering customers a higher price (or perceived price), they will believe your brand to be of higher quality than the rest of your competitors. Not only this, but they will secretly thank you for providing them with more value. I think Carlton Draught sums this up in an ad I saw the other day:
“What is Gallantry? Is it standing for a lady or is it standing for Prime Minister and making her First Lady?” – Carlton Draught.
So SBB’er, go and have some fun, you’ve earned it 
.
Best of Luck Branding,
Robert Kingston.
