All
forms of value are not created equal.
Perceived Value determines
how much your customers will be willing to pay for what you’re offering.
 |
| David Brett-Williams: Perceived Value |
The
higher the perceived value of your offering, the more you’ll be able to charge
for it, which significantly improves your chances of succeeding.
As a rule of thumb, the less attractive the End Result and the more end-user involvement it takes to get the benefit, the lower the value your customers will place on the offer. Here’s an example: A car owner may be willing to pay a maximum one-time fee of £80 for a car cleaning kit, but they’d be willing to pay £1040 a year (£20 a week) to have someone clean their car every week for them.
The car gets cleaned either way, but the weekly cleaning service has a higher perceived value because the car owner doesn’t have to spend any time or effort to get the same desired result. Charging £300 a month for your car cleaning service, however, won’t work — car owners don’t care about having a clean car that much.
Focus on creating Forms of Value that require the least consumer effort to get the best possible End Result — they will have the highest perceived value.
As a rule of thumb, the less attractive the End Result and the more end-user involvement it takes to get the benefit, the lower the value your customers will place on the offer. Here’s an example: A car owner may be willing to pay a maximum one-time fee of £80 for a car cleaning kit, but they’d be willing to pay £1040 a year (£20 a week) to have someone clean their car every week for them.
The car gets cleaned either way, but the weekly cleaning service has a higher perceived value because the car owner doesn’t have to spend any time or effort to get the same desired result. Charging £300 a month for your car cleaning service, however, won’t work — car owners don’t care about having a clean car that much.
Focus on creating Forms of Value that require the least consumer effort to get the best possible End Result — they will have the highest perceived value.
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