Mini Marvels In My Town
I’m a price-sensitive consumer, a trait that seems ingrained in our culture. It’s common for me to find myself in debates with my dad over the cost of things. My instinct has always been to cut costs to attract more customers. After all, isn’t it better to sell more at a lower price? But watching my dad run a premium business, I’ve learned a valuable lesson: perception often outweighs reality.
Take coffee, that I am perfectly capable of making at home for a fraction of the cost. Yet, we are willing to spend 500Rs. or more on a coffee at a cafe. Why? Because the experience often outweighs the actual cost. This is a fundamental principle: effective branding allows companies to command higher prices and boost profits.
Now I don’t care what brand of paper I buy. If I’m in the market to buy paper, I’m simply looking for the best deal. If you make paper and want me to buy from you, you need to communicate your value. You need to show me how your paper is ‘better’ than the ones I’d otherwise buy. If you can’t, then you need to price them cheaper if you want to get my business. With price as your biggest and only differentiator, you’re in a race to the bottom. There's always someone, somewhere, willing to sell it cheaper. This is the challenge of selling a commodity.
Supermarkets often use the loss-leader principle, selling staple items like bread and milk at a loss to attract customers who might then purchase other items at full price. While this can be effective for certain products, it's risky for premium brands. Selling a premium product at a discount can erode its perceived value and attract customers who are interested in a bargain.
Branding is not just about the product but the experience and narrative that surrounds it. A strong brand can make a premium price seem reasonable by creating a compelling story, a ambiance, or an exceptional service. McKinsey's research shows that a 5% increase in price can lead to up to a 50% increase in profits in some industries. This is because higher prices significantly improve profit margins more than cost reductions ever can.
There’s no future in selling something perceived by customers as a commodity. That space has been monopolized by giant brands. You’re unlikely to win going up against Coca-Cola or Pepsi with your own cola drink. In order to prevent your business value from being commoditized, it’s essential to position your product in a way that creates value so that they’ll pay good money even if they can buy something similar from somewhere else.
Perhaps your drink is manufactured locally, your plant is powered by solar energy, or 10% of your profits go to a social cause. Creating perceived value in a product, company, or service is about creating something bigger than whatever it is you’re selling. In the end, perception is everything. It's the reason why some people "know the price of everything but the value of nothing." It’s not about “25% extra free.”
80% of successful marketing copy is rooted in one thing: Research. You can’t speak to your customer if you don’t know who they are.
Dive into reviews, surveys, and even Reddit threads to understand the language they use and the pain points they feel. It’s not just about selling a product—it’s about holding up a mirror to your customer and showing them what they need.
That’s the foundation of effective copy. Recently, I came across this research from the University of New York that found "Those who speak the most in a group often end up as leaders."
This is known as the "Babble Hypothesis" in leadership. Interestingly people tend to hold back unless we have something valuable to add. Meanwhile, I've noticed that many men are more likely to speak up, sometimes even without a clear point, but with confidence.
It’s time we start speaking up more. Who knows, maybe next time, we’ll be the ones getting that promotion. Check out our new website created just to bring smile on faces of kids. Website
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