You will often see an inferior product sell for a higher price than a superior product. People haven't bought on the basis of true value they have bought because the product looked better, or was marketed better, or is more fashionable, or for some other reason.
People rarely buy on true value they buy on perceived value. There are many things that enter into establishing that perception. Let's have a look at a few.
#1. Fashion.
Shoes were invented as functional aids to make walking more comfortable. It only takes a brief observation of the shoes that women buy to realize that comfort has little input in calculating perceived value in this market place.
Fashion is all about what you believe other people will think of you. A brand that is highly fashionable today and ensures high status for the purchaser could well become an unfashionable brand tomorrow and a source of embarrassment.
All that being said, whether you think it crazy or magnificent, fashion is a strong influencer of perceived value.
#2. Marketing.
Marketing does not necessarily provide an accurate picture of the value of the product. If you watch television advertising for men's deodorant you will discover that any man applying a particular brand of deodorant will have women falling at his feet and falling madly in lust with him. As this rarely happens to me I must conclude that it isn't true or that I am buying the wrong brand.
One thing that I know for sure is that well established companies like Coca Cola don't continually spend huge amounts of money on marketing unless they have excellent evidence that marketing is a big factor in influencing their clients' perceived value when it comes to beverage selection.
In reality all sugar based drinks are unnecessary and fattening. We don't need to drink anything other than water. But be that as it may the total world sales of sugar based drinks is enormous and it's all based on perceived value, mostly created via marketing.
#3. Salesmanship
Your perceived value can be greatly influenced by the person who is selling you the item. In reality, unless you have actually used all the competing products, you don't really know for sure which product is the best. Because of this lack of certainty your perceived value is always open to influence.
A good salesperson believes that their job is to make the decision for you rather than to help you make an independent decision. They will generally make the decision based on what is best for them rather than on what is best for you, but if they are skilled at their profession you will walk away happy that you have received great value for money.
Concluding Remarks.
The business that prospers in this world is the business that is best at influencing their potential clients' perceived value. They may truly sell the best value product in the market or they may not, but even if their product is the best they realize that having the best valued product isn't enough to ensure sales.
Before you set your exact price you must decide upon a Suitable pricing model there are two basic models in Existence today Ebook purchasing is Still in its infancy Many online marketing gurus? advocate testing your product Price by selling at a high price initially and eventually Lowering it until the floods of sales start coming in This has a potentially negative impact on your customers. If You had bought a book at $50 to find a week later that it Was selling for $29.95 you would not be too happy would you! All of these methods are hit and miss and less than Scientific in their approach There is an amazing amount of information on the Web about All forms of online marketing. The one subject they do not Cover is pricing.
1. Price to Penetrate. Here your goal is to penetrate the Market by selling your ebook in volume this means you Should price your product low compared to the competition. The balance here is to find a price that maximizes profits AND number of ebook sold. Use this strategy to acquire as many customers as possible. Some authors even price their ebook at a loss to get a high Number of customers Why? Because they understand the lifetime value of a Customer An existing customer is more likely to buy from You again In fact, it is not uncommon for more than 80% of First time customers to buy a second product from the same Source as the first this is especially true if the first Product they bought was deemed by them to be of exceptional Value If you want to establish market dominance with your ebook Then pricing to penetrate is a good strategy although your Profit level will be low at the expense of acquiring a large Number of customers 2. Premium pricing - price to skim. With this strategy you Price your ebook high and every sale brings a much larger Profit at the expense of fewer customers, and therefore a Smaller market share. If you are pricing high on the net your ebook had better be Unique and covering a subject that everyone wants to know Something about Even then you are begging for someone to Come along and undercut you on price. The most valid reason for using this strategy is that your Ebook covers something new, maybe a new technique for doing Something, which is not yet common knowledge Don't stick with this skimming strategy forever as your Ebook sales will eventually peter out to nothing. It is Important you determine in advance how long you will use This strategy before you switch to a different pricing Model
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James Delrojo has sinced written about articles on various topics from Outsourcing, Self Improvement and Motivation and Health. James Delrojo would like to help you by giving you his ebook "Unleash the Success Power of Your Mind" (valued at $27) completely FREE. Go to