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- WTH is Perceived Value | Say 'costs $X more' for premium | PV GPT prompt🔥
WTH is Perceived Value | Say 'costs $X more' for premium | PV GPT prompt🔥
Deep Kakkad
July 16, 2024
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Table of Contents
Curated Careers
Trends and Tidbits:
WTH is Customer Perceived Value? 5 Tips to improve 🚀
Say ‘costs $x more’ for premium products
AI Arena:
Perceived Value Optimizer ChatGPT
Interesting reads for the week
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💎 Trendy Tidbits 💎
➡️ WTH is Customer Perceived Value?
Imagine your mom told you,
👵“Get some olive oil while coming back…”
You visit Walmart and look at two different bottles of olive oil.
One has a plain label with the basic details.
The other has a sleek design, mentions awards, and has a story about the grandma who started it in 1905 and the family who’s been making it for generations.🫒
But, here’s a twist: the left one is priced at $10 while the right one is $12.99.
Which one do you grab?
Still deciding?
Decided?
Probably the fancy one, right? Me too — welcome to the gang! 🙋♂️
That’s Customer Perceived Value at Work.
It’s not just me telling you a random olive oil story,
that’s what research concludes.
There was an experiment conducted for wine tasters a little while ago. A bunch of volunteers tasted two bottles of wine and were told to describe the taste of each one.
Bottle A came with a price tag of $5, while B had a price tag of $45.
Most volunteers claimed the costly wine tasted better than the cheap bottle.
But, here’s a twist: Both the bottles had the exact same wine in them 😆
Giphy
Enough of people making fools of themselves… to today’s topic.
What is Customer Perceived Value (CPV)? I’ll make it simple.
It’s all about how customers see the worth of your product or service.
If you drew a conclusion already — “Huh! It is a cheap pricing trick!”
… it's not just about the price tag. It is about the entire experience: from the product’s features to the way it’s marketed and even how it's packaged.
Think of perceived value as the overall impression your brand leaves. If customers feel they’re getting a lot of value for what they pay, that’s high CPV. And that often means they’re more likely to choose your product over others.
I will repeat what I said: “If customers feel they’re getting a lot of value…”
The feel is underlined and bolded to reiterate the fact that they may or may not be actually getting more value. It just needs to feel like it :)
➡️ How to measure Customer Perception?
As you could guess, it’s not a quantitative metric.
It’s qualitative. It is backed by the psychological behaviour of people.
But, measuring (or rather deriving) CPV (through indirect means of quantitive metrics) is possible. Here’s how:
1) Customer Surveys: Direct feedback is gold. Ask your customers what they like and what could be better. Tools like SurveyMonkey make this simple.
2) Net Promoter Score (NPS): This measures loyalty. Just ask: "On a scale of 0-10, how likely are you to recommend us to a friend?"
3) Social Media Monitoring: See what people are saying about your brand on social media. It gives you a real-time pulse on customer sentiment.
4) Retention rate: Look at repeat purchases and customer retention rates. If people keep coming back, your CPV is probably high.
But, I don’t think JUST keeping track of customer’s perceptions is enough.
All these learnings only good if you learn how to influence it.
So, how?😢
Well, we did half the work for you! 🫡
We turned pages of the best 15+ marketing resources and found these ideas:
➡️ 5 Tips to favor high CPV
1) Trigger emotions → Humans are emotional creatures.
They might show all the logicality on the surface, but deep down they make decisions driven by triggered emotions.
And how do you find emotion in your product?🤔 Stories!
People listen to stories, not to your commercials. So, tell your story! Try to explain why it matters, and how it brings a change. Stop promoting your product, rather offer a whole new way of living, a feeling or an experience.
2) Let people experience before they buy →
This is one idea I found interesting.
3) Create a mission → show a social responsibility, and have a genuine approach to accomplish the mission.
If they observe that it’s for a good cause, they won’t mind paying that extra dollar! Learn from the likes of Ten Tree and Mama Earth.
4) Value-based pricing → As you saw in the wine experiment, price matters.
Do you remember when Apple started selling polishing clothes for $19.99?
Well, don’t even go that extreme. But, think about the perceived value you want to create in your customer’s brain and price accordingly. Rarely does a cheap item create an image of a high-quality item.
Initially test and shuffle your prices to ultimately figure out the right spot.
5) More miscellaneous tips →
The last tip is a sum of many, mostly used for e-commerce product pages.
→ Use high-quality visuals 📷 (because they cannot touch & feel online!)
→ Offer flawless after-sales customer service.
Don’t be that one brand that doesn’t care after the sale is clear!
People hate them, but the ones who serve the customers with quick responses (with all the FAQ sections and chatbots) seem to have high repeat orders as per this HubSpot report.
→ Use charm-pricing (price it at $8.99 and not $9)
→ Try the decoy effect. If you don’t know what that is - I have explained it here.
And that’s a wrap on Customer Perception for now ✅
Congrats on becoming a CPV specialist 🙌 Feel free to share with your friends.
In other thoughts…
Say “costs $x more” for premium options — Source Ariyh
In a series of experiments, when the price for a premium product was mentioned as “for $ more” people:
Were 38% more likely to say they would buy a 27-inch computer monitor ($60 more vs $259.99) rather than a 23-inch monitor ($199.99)
Doubled their choice of a larger subscription plan for the New York Times ($16.99 + $ 7 more)
Were 40% more likely to buy a premium bicycle ($150 + $60 more).
The effect holds for quick and effortless decisions. When people take their time to look at and calculate prices, the effect disappears.
FREE AI & ChatGPT Masterclass to automate 50% of your workflow
More than 300 Million people use AI across the globe, but just the top 1% know the right ones for the right use-cases.
Join this free masterclass on AI tools that will teach you the 25 most useful AI tools on the internet – that too for $0 (they have 100 free seats only!)
This masterclass will teach you how to:
Build business strategies & solve problems like a pro
Write content for emails, socials & more in minutes
Build AI assistants & custom bots in minutes
Research 10x faster, do more in less time & make your life easier
You’ll wish you knew about this FREE AI masterclass sooner 😉
🤖 AI Arena 🤖
CPV Optimizer GPT
Copy and paste the following prompt into your chatGPT to start off with your CPV optimization. It takes information about your business, and USP, analyzes the KPIs, and gives suggestions.
Act like a marketing professional with over 10 years of experience in customer perception optimization. Your goal is to optimize the customer perceived value (CPV) of a product by learning about the user's business and product.First, ask the user for the necessary information about their business and product to create the perfect optimization plan for CPV.
Step 1: Understand the Business
Ask for a detailed description of their business.
Inquire about the history and mission of the business.
Request information about the target market and customer demographics.
Find out the unique selling propositions (USPs) of their business.
Step 2: Understand the Product
Ask for a comprehensive description of the product they want to optimize.
Inquire about the product's features, benefits, and value propositions.
Find out the current pricing strategy and positioning in the market.
Ask for details on customer feedback and reviews received so far.
Step 3: Competitor Analysis
Request a list of main competitors and their products.
Inquire about competitors’ pricing strategies, marketing tactics, and market positioning.
Ask for a SWOT analysis (Strengths, Weaknesses, Opportunities, Threats) if available.
Step 4: Market Research
Ask if they have any market research data or customer insights.
Inquire about industry trends, customer preferences, and emerging market needs.
Find out about the current market share and potential growth areas.
Step 5: Customer Perception
Ask for customer testimonials or case studies that highlight the product’s strengths.
Inquire about common customer pain points and how the product addresses them.
Request information on the customer journey and touchpoints with the product.
Step 6: Objectives and Goals
Ask about the specific goals they want to achieve through CPV optimization.
Inquire about any upcoming product launches, promotions, or campaigns.
Find out the key performance indicators (KPIs) they use to measure success.
Step 7: Budget and Resources
Ask about the budget allocated for CPV optimization.
Inquire about the available resources and team capabilities.
Find out if there are any constraints or limitations that need to be considered.
Provide personalized suggestions based on thorough market research and competitor analysis. Include strategies for enhancing the perceived value of the product through improved messaging, better alignment with customer needs, and differentiated positioning.
Take a deep breath and work on this problem step-by-step.
🧠Interesting reads🧠
🔗The Future of AI in Sales → Link
🔗 5 interesting stats to start your week → Link
🔗 The value of transparent marketing → Link
Thanks,
Deep Kakkad, your marketer friend.
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