“Perceived value is the worth that a product or service has in the mind of the consumer. For the most part, consumers are unaware of the true cost of production for the products they buy; instead, they simply have an internal feeling for how much certain products are worth to them.” Quote by Investopedia
We recently sold a lawn mower. I posted it up on Craigslist for a price that I thought was a good deal. Took a few quick photos. Listed it and waited for the phone calls and text.
Problem was, I hardly got any response.
My mistake was in the presentation. It was simple and to the point. There was no sales pitch in the listing.
Since I showed such little effort in the presentation, I believe the perceived value was lower. I pulled the listing from the internet. Detail washed the mower, took professional looking photographs and laid out all of the accessories that were included in the sale.
Now what I did next surprises people.
I raised the price. By hundreds of dollars.
Next thing I know, countless calls and texts. I had now created an environment that gave the item more perceived value. While cleaning this mower I started to remember how good it really was. How productive I was on it. How remarkably different it was to anything that our local market was become accustomed to. Once I felt the value go up to me, I was able to convey that through my newest listing ads.
A guy drove an hour an half to come pick it up. He just had to have it. Paid my new higher price with no questions asked. No negotiations on cost.
I would bet the new owner takes better care of this machine than if a buyer would have bought from my lousy ad that I started with.
Plus I made more money.