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What is Perceived Value in Marketing Terms?

Value

by Kenneth Rudich

In numerous submissions to this blog, we have repeatedly emphasized the importance of perceived value when marketing a product or service.  Perceived value is the benefits relative to the price or cost; as in Benefits/Costs = Perceived Value.

Effective marketing attempts to isolate the benefits a product or service can offer, for whom (including whether there’ll be enough critical mass of customers to make it viable), and to what degree.

The attention we’ve given to the concept of creating value over the course of creating this blog makes it the most dominant theme strung throughout it.  Accordingly, we now wish to present yet another insightful perspective.

Perceived Value

A few years back we came across a quote in a 2001 Computer World article in which former MIT Professor Michael L. Dertouzos elaborated on the idea of perceived value in a manner that struck us as brilliantly illustrative.  So much so that we copied it and kept it on file. 

With that said, here is his take on the role human psychology can play in shaping an individual’s outlook on the value of technology:

“You can divide people into their principal components.  I like to think of the individual as a four-cylinder car.  The four cylinders are our physical, rational, emotional or artistic and spiritual dimensions.  Most technologists run on only one or two cylinders, generally the rational and physical.  Humanists run on just about the same number of cylinders: the physical and artistic.  So if you’re a technologist or a business person focused on getting things done, you’ll be incredibly better off with computers.  If you’re an artist, you’ll only be marginally better off.  You’ll have tools to do your creative work, but you won’t be able to write or paint better.  And if you’re a monk, forget it.  You won’t be better off, because spiritual activity is primarily internal to people.”

After reading this explanation, can you see how the notion of perceived value influences the way you might market or promote a product?  Or how it affects the appeal of a product?  Or how you might target your marketing based on having this kind of insight?

Do you regularly gather information about your customer’s motives and perceptions?  And do you use it to better tailor your marketing initiative?

If so, tell us about it.  How do you gather the information, and how has it influenced your marketing?       

3 Comments

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