I haven't seen perceived value and cost, and their connection to sales, talked about much (recently anyway), despite being really basic, yet crucial stuff. I touched on value and overcoming objections a number of times in my Landing Page Checklist, but I never really get down to the meat and potatoes of it all.
Why It's Important
Understanding the basic motivations behind actions is crucial for your success in this business. Whether that be affiliate marketing, product creation, providing services, or anything else that requires you to have buyers to stay in business. Hint: Everything.
The wealth of knowledge on buyer psychology is massive, with new things being discovered and debunked all the time, so I'm only going to cover the most basic, but largely universal points.
The concept is simple:
When people buy something, they're doing so because they believe it will be adding value to their lives. In other words, the perceived value must outweigh the potential costs. As a marketer or salesman, it's your job to tip the scales in favor of value, and the more the perceived value outweighs the costs, the more likely you are to make the sale.
More Than Just Money
The costs to the buyer are about a lot more than just money. In fact, the actual price tag of your product is the least of your problems, and many times, as with affiliate marketing, you have no control over the price anyway.
I'll come back to pricing later, but let's talk about other costs to the buyer first:
Time – Time is probably the most universal because time is our most limited resource, and ties into many of the other forms of cost I'm going to touch on. This is why words like “instantly”, “quickly” or some other variation are used over and over, all throughout landing pages. Not only is there the time it takes to make a purchase, but the time investment required to reap all the benefits of your product, after the purchase.
Effort – The buyer has already handed over their hard-earned cash for your product, and they don't want to have to work for it again. This applies before and after the purchase. Makes it easy to buy, and make it clear just how easy it will be for them to start adding value to their lives. If the buyer is lead to believe that there will be a lot of work involved, they may just go looking for a simpler solution.
This is one of many reasons so much attention is paid to streamlining and simplifying the checkout process. It doesn't take much to turn off the buyer and even the slightest bit of resistance in the checkout process is enough to completely ice a ready-to-buy prospect.
There is something called “The Ikea Effect” that, although counterintuitive, is worth considering.
Mental Stress – Pushing buyers to confront problems is an indispensable sales tactic, but push it too far, and you'll scare them away. The key is to make them uncomfortable, not to overwhelm them, followed up by an irresistible solution.
There are a lot of other factors that fall under this form of cost. Trust, for example, plays a crucial role. If you haven't established trust with the buyer, they'll get nervous, and back out.
Reduce the costs associated with your product, and the work you have to put into upping your perceived value will be reduced dramatically.
Increasing Your Product's Perceived Value
The value of your product not only has to outweigh the associated costs, but it must outweigh the perceived value of your competitors as well. Of course, having a product that's actually valuable will give you a huge head start.
Below are a few ways you can boost the perceived value of your product. I've only included a few key points, because I'm more strapped for time than I expected, and a lot of this stuff was covered in the Landing Page Checklist already.
Solutions – If a buyer comes to you, chances are they're looking for a solution to a specific problem that is currently a priority for them. Fail to address it, and you'll fail to get the sale. Unfortunately, everyone's problems are different, and you're going to need to address all of them, and offer solutions too. This is what value is all about.
Social Proof – I don't know about you, but customer reviews are the first thing I look at when I'm shopping on Amazon. If other people are benefiting from a product, I figure that I too will be able to benefit from it. The same thing goes for expert testimonials and endorsements. If someone's going to put their name and reputation on the line for a product, it's gotta be good right? Although some names and reputations are certainly more valuable than others.
Scarcity – Things that are rare, must be valuable, right? Not always, but this is how people think. Limit perceived access to your product and the demand will skyrocket. Not only does the buyer gain the value of having a rare item, but they also get to enjoy the benefits of being in the in-crowd.
Pricing – Most people would think of the monetary cost of an item being a negative, but only noobs (or market leaders lol) compete on price. Use the price tag to your advantage, to increase the perceived value of your product. The $100 product has to be better than the $25 competitor's product right? Again, not always, but it can always be the case if you word it right.
Like I mentioned, I don't have much time, so I'll stop here. If anyone has any questions or criticisms, please share, and I'll address them when I return.
Why It's Important
Understanding the basic motivations behind actions is crucial for your success in this business. Whether that be affiliate marketing, product creation, providing services, or anything else that requires you to have buyers to stay in business. Hint: Everything.
The wealth of knowledge on buyer psychology is massive, with new things being discovered and debunked all the time, so I'm only going to cover the most basic, but largely universal points.
The concept is simple:
When people buy something, they're doing so because they believe it will be adding value to their lives. In other words, the perceived value must outweigh the potential costs. As a marketer or salesman, it's your job to tip the scales in favor of value, and the more the perceived value outweighs the costs, the more likely you are to make the sale.
More Than Just Money
The costs to the buyer are about a lot more than just money. In fact, the actual price tag of your product is the least of your problems, and many times, as with affiliate marketing, you have no control over the price anyway.
I'll come back to pricing later, but let's talk about other costs to the buyer first:
Time – Time is probably the most universal because time is our most limited resource, and ties into many of the other forms of cost I'm going to touch on. This is why words like “instantly”, “quickly” or some other variation are used over and over, all throughout landing pages. Not only is there the time it takes to make a purchase, but the time investment required to reap all the benefits of your product, after the purchase.
Effort – The buyer has already handed over their hard-earned cash for your product, and they don't want to have to work for it again. This applies before and after the purchase. Makes it easy to buy, and make it clear just how easy it will be for them to start adding value to their lives. If the buyer is lead to believe that there will be a lot of work involved, they may just go looking for a simpler solution.
This is one of many reasons so much attention is paid to streamlining and simplifying the checkout process. It doesn't take much to turn off the buyer and even the slightest bit of resistance in the checkout process is enough to completely ice a ready-to-buy prospect.
There is something called “The Ikea Effect” that, although counterintuitive, is worth considering.
Mental Stress – Pushing buyers to confront problems is an indispensable sales tactic, but push it too far, and you'll scare them away. The key is to make them uncomfortable, not to overwhelm them, followed up by an irresistible solution.
There are a lot of other factors that fall under this form of cost. Trust, for example, plays a crucial role. If you haven't established trust with the buyer, they'll get nervous, and back out.
Reduce the costs associated with your product, and the work you have to put into upping your perceived value will be reduced dramatically.
Increasing Your Product's Perceived Value
The value of your product not only has to outweigh the associated costs, but it must outweigh the perceived value of your competitors as well. Of course, having a product that's actually valuable will give you a huge head start.
Below are a few ways you can boost the perceived value of your product. I've only included a few key points, because I'm more strapped for time than I expected, and a lot of this stuff was covered in the Landing Page Checklist already.
Solutions – If a buyer comes to you, chances are they're looking for a solution to a specific problem that is currently a priority for them. Fail to address it, and you'll fail to get the sale. Unfortunately, everyone's problems are different, and you're going to need to address all of them, and offer solutions too. This is what value is all about.
Social Proof – I don't know about you, but customer reviews are the first thing I look at when I'm shopping on Amazon. If other people are benefiting from a product, I figure that I too will be able to benefit from it. The same thing goes for expert testimonials and endorsements. If someone's going to put their name and reputation on the line for a product, it's gotta be good right? Although some names and reputations are certainly more valuable than others.
Scarcity – Things that are rare, must be valuable, right? Not always, but this is how people think. Limit perceived access to your product and the demand will skyrocket. Not only does the buyer gain the value of having a rare item, but they also get to enjoy the benefits of being in the in-crowd.
Pricing – Most people would think of the monetary cost of an item being a negative, but only noobs (or market leaders lol) compete on price. Use the price tag to your advantage, to increase the perceived value of your product. The $100 product has to be better than the $25 competitor's product right? Again, not always, but it can always be the case if you word it right.
Like I mentioned, I don't have much time, so I'll stop here. If anyone has any questions or criticisms, please share, and I'll address them when I return.
