There are great products and services every day that fall by the wayside. They never see their full potential. People do not notice them. Why? There are many reasons, but one that I notice is devaluing a product.

Free is not worth anything

I see this one a lot – A company comes up with a new great product or service. Their marketing plan is to give it away for free, or price it way below market price. They think this will create a buzz, get lots of people to try it, and it will snowball into profits and accolades.

However, too often the exact opposite occurs. People see no value in the product. It’s seen as cheap, or too good to be true. It’s no better than an infomercial. That great idea has now turned into a bauble in the customer’s eye.

Don’t become junk food

Do people value a 99 cent burger from McDonalds? Not likely. They probably see it as fast food, or the more appropriate term, “junk food”. If you price your product or service incorrectly (on the low side), people may perceive it in the same category of fast food. And I don’t know too many merchants that want their offerings seen in the same light as something with the name “junk” in it.

Stick to your guns

Once you’ve done your market research, and have determined a price point that allows you to continue a high level of service or workmanship, stick to your guns. This doesn’t mean gouge your customers, or set unrealistic prices. It means setting your prices in such a way that people perceive your offering to be valuable.

Perception becomes reality.

Let me type that again – Perception becomes reality.

If people believe something has value to them, then in their eyes, it is valuable. And they’ll pay more for it. Of course you have to make true on your promises. Your offer must have actual “perceived” value. This is where effective marketing enters the picture…

Solid marketing is needed

A consistent and effective message must be presented to potential customers. Marketing techniques that make people feel like they must have your new widget are key to a valuable offer. Price point is one way to increase value. Tie that together with an “on-target” marketing message, and you’ll be on your way to selling value.

Jim Connolly’s recent blog post about having something worthwhile to offer sums this up nicely.

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What do you think? Can pricing a product correctly and using effective marketing create value?

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