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.