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Blake Beattie
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Real Value v Perceived Value  18.06.2008

 Real Value v Perceived Value

 

Let's say I was in the market for a vacuum cleaner. There are many different brands, styles and prices to choose from. What would make me spend three times the average amount to buy a Dyson vacuum cleaner?

 

The answer of course lies in perceived value – not real value. Let me explain: the real value of something is obviously important, but what is more important from a selling perspective is the communication of that value to the potential buyer (the perceived value). There are numerous products on the market right now that are far better in terms of value, quality and price but are outsold by an inferior competitor. Why? The answer lies in perceived value.

 

If I looked at a catalogue and I noticed the Dyson vacuum cleaner, why would I spend $799 for a Dyson when I can spend $89.95 on a 2400W Bagless Cyclonis Vacuum Cleaner with a bonus filter set and turbo head from a no-name brand? I could buy almost 9 of these no-name brands for the price of one Dyson.


I know of 3 people with a Dyson vacuum cleaner. I also know that the Dysons DC01 was once the best-selling vacuum cleaner in the UK. This unit was selling 32,000 unit a month – 5 times more than the next best selling vacuum cleaner. Why are they so popular?

 

  • It is perceived by many to be the best vacuum cleaner
  • It removes more dust without clogging up or losing suction
  • Dyson machines look funky – they have won several design and innovation awards
  • It is the only vacuum cleaner approved by the National Asthma Council and the British Allergy Foundation
  • It is fitted with Dyson life-time filters
  • Kills minute bacteria, germs and funghi & prevent them from being circulated into the air

 

No, I don’t have shares in Dyson – nor do I currently have a Dyson vacuum cleaner myself (although my parents do). But my point is: how is your product or service perceived in the marketplace? And do people associate your brand with a value proposition that is greater than your competitors?

 

In the book ‘Flip’ by Peter Sheahan (a book that I thoroughly recommend), he says that businesses today need to be doing things faster, better, cheaper with an ‘x’ factor that separates its value proposition from that of competitors. I would add to this that businesses must ensure that they are communicating this in the right way at the right time to its customers and clients (as well as delivering results that are consistent with the value offering).

A couple of great questions to ask are:

 

  • What is my current product or service offering?
  • How can the current product or service offering be improved?
  • How can we better communicate this value to our customers and clients?

 

Create unbeatable value, offer more than customers expect, and communicate that value to buyers and your business sales are likely to remain strong.


Enjoy the journey,

 

Blake Beattie

 

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