Know-How Exchange : Student Questions

How the customer perceives the product matters more than what the product really is. If their perception is that the product is garbage (even if you have all sorts of tests showing that the product is the best out there), it won't sell.

Value is what the customer THINKS that the product will do for them. This is made up of their benefit from the product minus the costs (purchase price, install price, etc.).

Putting these together is the perceived value, which is probably one of the most important things. This says what the customer thinks the product is worth to them. If you have the best perceived value, your product should be the one which is bought.

Let me ask you something:

Which do you think is better:


Heinz or Hunts

Kobe or Shaq

Bud or Coors

Evian or Aquafina

The Gap or Old Navy

Why?