Do You Really Get What You Pay For, or is Perception Reality?

I went to a networking event a few weeks ago and ran into an old colleague from a previous company. This guy was impeccably dressed, like he could have been one of Vic the tailor’s regulars. I couldn’t help noticing he didn’t order any of the drink or food specials. I only noticed because we used to hang out quite a bit and I know his beer of choice was one of the beers on special. Curious, I asked him why he wasn’t ordering his favorite beer when it was on special. And he said “You get what you pay for. There’s gotta be a reason that stuff is on ‘special’.  The full priced stuff tastes better.” Baffled, I told him, “This stuff won’t be on special tomorrow and I’m pretty sure it will taste the same.”

“People spend $7 for a Starbucks coffee when blind taste tests have proved that it doesn’t taste any better than the stuff they sell at Walmart. The moment you put that coffee in that white paper cup with the green mermaid and pay the barista for it, it tastes better and is ‘more caffeinated’ to get you through your morning.”

It got me thinking. Are the lines between “perception is reality” and “you get what you pay for” becoming blurred?  I think we all are plagued by some level of brand bigotry.  Brand loyalty is the goal of a marketer and getting consumers to pay a premium for a brand is the Holy Grail. So, if the quality of a cup of Starbucks coffee is the same as the one I brewed at home from a can I bought at Walmart (at a fraction of the price), am I getting what I paid for? Or does the perceived quality make it taste better?  I found several studies that showed beer was rated “better tasting” if it had a label on it, as opposed to having no label.  There are even studies that show consumers rated over-the-counter pain medication was more effective if they paid full price for it, as compared to buying it on sale.

We run into this baffling issue every day at Cirrascale. People tend to show preference towards larger, more established brands of computer systems, over our customer-tailored, engineering solutions.  We don’t do exactly what they do, as I mentioned on my previous blog posts.

Still, people and corporations have their pre-conceived ideas of what’s better… which can be hard to overcome.  There was a senior manager from a large corporation who really wanted to buy our products because we designed and engineered a tailored solution that met all their business needs, but he couldn’t get buy-in from a few others. They decided to go with another company, and six months later, that same manager came back to us. He asked if we were willing to go through the same exercise, for an even larger opportunity.  It turns out that doing business with one of the big brands was a lot more painful than they expected. Their every need wasn’t met.  Needless to say, we won that second deal and they are happy with their purchase.  We have cultivated a strong partnership with them and are now even co-developing products with them to meet their application needs.

In my personal life, I try to not to let my own brand bigotry get in the way of selecting most things. Yet there are times, I find myself avoiding certain stores or brands for preference of another. It’s a natural psychological phenomenon, I suppose, and still I try to make a conscious effort to make rational decisions on purchases.  In the meantime, I’ll enjoy the food and drink specials and my occasional Venti White Chocolate Mocha– with no whip.

Tell me what you think in the comments below. Do you really get what you pay for, or is perception reality?

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