The price is right…
Price is one of the many factors that determines whether a product is successful or not. This factor can have a huge psychological effect on consumers. Price seems to place a position in shoppers’ mind, making them think the product is higher quality than it really is in reality or vice versa. If an Louis Vuitton (LV) bag were to be on the shelves of Walmart, how would it affect your perspective of the bag? The brand image would decrease, because the bag is now at such an affordable price that anyone can own it. If anyone can afford it, it loses a sense of luxury.
If one of Walmart’s brand, Faded Glory, was introduced in a Macy’s department store instead of Walmart, it would give the consumers an impression that Faded Glory is a luxury high quality brand. Marketers are able to position their products in people’s mind in any direction they wanted. The next time you shop for a product, ask yourself this question, ” Am I paying for the brand or the quality of the material?”
Not long ago, I had a friend who was in the market for a laptop. He wasn’t very knowledge about computers and just needed a new one for school. He went down to Best Buy and saw a computer he really liked, it met all the specifications and requirements for school and thought it was the ‘perfect’ computer. The price of the computer was close to $1000 and he thought “this must be a good laptop given the expensive price”. He then went on and asked a Best Buy sales associate if he would personally buy this laptop. The sale associate replied saying “For a price as expensive as this, it HAS to be a good computer”. My friend ended up buying the computer but later exchanged it for a less influential brand.
When the price is right, the product positions itself into consumers’ mind. This is not rocket science nor does it take a psychologist to figure this out, all it takes is a Marketer with the right experience.
From episode “Big Pink Loser”