A bird does not sing because it has an answer.  It sings because it has a song.

19 June 2009

Judging Books By Their Covers

Here's some news from Harvard Business Review that probably won't surprise you: consumer expectations about products have a greater impact on their buying habits than the products themselves. In other words, if a marketing campaign or a salesperson creates an expectation -- that a product will taste great, be less filling, outperform the "leading brand," or deliver great value -- odds are the consumer will make their purchase decision based on that information.

Now, what may surprise you is this: curiously, they may do this even when their experience doesn't really support that expectation. And even stranger, they may have the experience they expect of their purchase, even when the facts of the experience don't match the expectation.

Since that is a bit of a convoluted statement, here's an illustration, quoted from the article in HBR:

"Recent brain-imaging studies show that when people believe they’re drinking expensive wine, their reward circuitry is more active than when they think they’re drinking cheap wine—even when the wines are identical."

What does this mean to you? It doesn't mean you should sell cheap stuff and charge more for it, but it does mean you should not be shy about setting high expectations for your clients when you have a strong offering. And you should charge appropriately. Don't charge what you're really worth -- nobody can afford that, because you are worth more than you can possibly imagine. But do create an expectation that you provide an experience of superior quality and value, and set a commitment point consistent with that expectation.

Thomas Paine said, "What we obtain too cheap, we esteem too lightly." This HBR research confirms that great truth in empirical terms, in case you ever doubted it. By charging a fairly high (meaning high, but fair) price for quality service, you reinforce the client's expectation that they are getting something of value. As an added bonus, the client is more likely to experience the results you have promised, if for no other reason than that you promised them. In my experience, clients take a more active and cooperative role in the work I do with them if they have paid a premium for the service. The project is almost always a win-win, because both the client and I have made a commitment to their success.

Check out this article in the Harvard Business Review for the full scoop.

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