Oftentimes to compete with the big box stores, small businesses take to lowering their prices to bring in those customers. After all a lower price is linked with a higher value.
While this is true, there is a link, it is not the end all to competing on value.
There is a missing element to this equation that can mean a whole different ballgame completely.
Perceived quality-the forgotten child
Price and value skip merrily along and what’s left forgotten is the quality. What customers perceive they are getting for their money, the bargain.
Businesses should shift their thinking from focusing on price to focusing on value and not just that but PERCEIVED value. This is the “bargain”.
Is this worth my money?
The perceived quality, is how customers rate your product, it’s not enough to think build it and they will come. Communicate what you build clearly. Paint a clear and vivid picture, “Yes this is worth what you pay for and more!”
Bring back old customers by responding directly to complaints and saying, you know what, we have improved!
Increasing this side of the value equation can have a phenomenal effect on how much customers think they should pay, it is why those “Compare at” tags are so popular, because even if you were going to sell the product at that price anyways people will perceive the goods to be more valuable if they can tell they are paying more than their worth.
Take away: Don’t change the price, change the worth.