What Affects Customers Perception of Price?

People know an expensive brand when they see one. They also can spot a discount retailer at fifteen paces. So, why do they get it wrong so often? They get it wrong because of a concept called Price Image. Price Image is a concept that describes how people form impressions about whether your brand is high- or low-priced based on many non-price indicators. These ideas have a lot of influence on customer behavior. However, the Price Image is different from actual prices. Instead, Price Image is more like your reputation for prices; it would be how your customers describe your prices when you are not around. Another way to look at it is Price Image is where your price and brand intersect. To demonstrate what we mean consider the following: Will an Apple product be the most affordable version on the market? Do you think the airline ticket will be the most expensive one if you buy it from Southwest Airlines? Is Wal-Mart a high-end boutique? As you can see, each brand has a reputation, and none of these questions agrees with it. It is their Price Image, which these brands have carefully cultivated through their Customer Experience choices. However, you don't have to be careful about it. The Price Image is a product of the details included in your Customer Experience, and they tell customers everything about your prices long before they ever see a price tag. In other words, every brand has a Price Image, whether you were deliberate about what it is or not. So, how is it that people form these impressions? Price Image is the result of two things, the prices themselves and lots of what we call "non-price" information. If you focus on your pricing, you can manage at least part of your Price Image. However, the significant influence is non-price influences. Appearance, atmosphere, employee type, and other environmental factors create these customer perceptions. Unfortunately, a brand's Price Image is not always correct. Also, it can be challenging to change an established Price Image and tricky to navigate when you try to make the transition. This episode of The Intuitive Customer takes a deep dive into the idea of Price Image and how customers form them about your brand. We discuss what signals you send through your Customer Experience that affect your customers' perception of price and what you should consider if you want to change that impression one way or the other.   The Intuitive Customer podcasts help you take your Customer Experience to the next level by unlocking the "hidden" aspects of your experience and determining what really drives value for your customers. To find out more about how your organization's marketing can improve customer loyalty and retention, contact us at www.beyondphilosophy.com. To subscribe to The Intuitive Customer and never miss a podcast, please click here.