Can prices be set too low for consumers? A recent study by Dr. Antonio Rangel of CalTech says yes. Dr. Rangel observed the brain activity of subjects and found they exhibited more pleasure drinking wines when they thought they cost more. For those of us that study the finer points of pricing, this is a very interesting result. We all know that there is a sense to “you get what you pay for” that acts as a negative factor when evaluating the lowest priced alternatives. What Dr. Rangel has established is that there is more than the fear of getting stuck with an inferior product at work; people actually get more enjoyment from certain products if they think they cost more. The data communicated by the price is working not just at a rational level, but at an emotional level as well. That is, from the brain’s standpoint, these products are objectively better in a post-purchase environment.
This is what I think are some of the best bits.
We all want to be new school and know that the latest top hit song (via iTunes) is a song called SOS by Jonas Brothers. I had to look that up. Because what I pay attention to the most are things I already love. While I’d like to be super hip, the songs that run through my head are more like “The Way We Were” if I’m feeling melancholy, “Sweet Home Alabama” if I feel good, or Madonna’s “Like a Virgin” if I feel, ya know, sassy.
What does this have to do with marketing, you ask?
For each era, there are new rules. In the web world today, marketing online has new rules. Marketing is no longer about awareness online, but about creating an experience for the consumer or customer.
I propose the new marketing goal with online marketing is about engagement. Personal engagement. Connection from user to company. Customers like what you help them do. Your offerings are appealing and designed around and with them. Customers are delighted because they can exchange usages with one another and therefore find more ways to use your gadget. Joy of engagement brings them back again and again.
Segmentation has always been a key part of marketing. Sorting customers into appropriate segments allows business and marketing types to filter ideas, glean intelligence, set prices, and decide what to offer and what to toss.
Segmentation also allows successful companies to produce just the right thing to address the needs of different slices of the market.
I’m at the O’Reilly conference of Emerging Technology and it’s giving me just the right setting (and time away from the day job of leading Rubicon) to capture an idea I’ve been brewing for some time. Because the work I do is about helping companies to win markets, I pay a lot of attention to More
A colleague who works within one of my company’s clients writes this email to me about a month ago: “I still find myself scratching my head at how to apply this line of advice (referring to a white paper I sent on permeable markets) to a large highly profitable business. In the last session [Spark More