Perceived value is the value that a product or service has in a consumer’s mind. They’re usually unaware of what goes into the products they buy, in terms of production costs. And instead, they place a value on how much specific products are worth to them, from an internal feeling.
Marketers need to truly know the buyer persona
Consumers have different ways of defining value and because it’s subjective, it can be a tricky concept for marketers. So, when approaching perceived value, marketers need to know the buyer persona they’re targeting with their campaigns, inside and out. It’s important they dig deeper to gain a better understanding.
Absolut Advertising: The start of premium vodka
In 1981, Absolut Vodka created a new market. Before them, there was little advertising for vodka and a premium vodka industry didn’t exist.
Launching a campaign made up of simple ads featuring images of their characteristic vodka bottle and copy playing on the word “absolute”, it ran for nearly three decades.
Before that, vodka had seldom been advertised and there was no premium vodka industry. Absolut changed the game, showing how the pure visual aesthetic of the brand and bottle turned a commodity into a product you buy for the brand.
With an almost identical product to its competitors in terms of taste, Absolut managed to separate itself with a clever, visual campaign. And nowadays, premium vodka is a huge business, with brands owing a lot to Absolut’s revolutionary ads.
The same water, but different
Bottled water is desirable because of its convenience, health benefits and affordability. So, what makes Evian differ in price from its competitors?
With its live young campaign, the brand successfully created the perceived value that its bottled water is more wholesome, better for your skin and healthier than its competitors’. And they did so with a more luxurious bottle, French name and by leveraging its source – the French Alps. So surely, it must be worth more? Whereas in reality, it’s just the same as the next. Your body doesn’t differentiate between sources of water but your mind does.
What is Behavioural Economics?
Behavioural Economics has been around since the 60s. It blends elements of psychology and economics to identify the mental triggers, or bias, nudges and heuristics, that affect the decisions people make.
This blog series is your go-to guide for a snapshot into what these triggers are, and how they can be used in marketing to influence consumer behaviour.
A bit about us
As an agency, influencing behaviours is core to what we do and applying Behavioural Economics to marketing communications is a natural progression. If you are interested in understanding more about how we do this get in touch now.
Find out more about the connection between consumers and behavioural economics in our latest report on the top trends driving consumer behaviour. Download it here.
By Phil Monks
Deputy Creative Director