Quality sells, or at least perceived quality!
Let’s talk about biscuits. A topic that I have to admit I consider myself a specialist in, along with social media and football. Specifically, I want to compare two very popular biscuits in the UK, and show you how quality can cost less but make more money.
Jaffa Cakes vs Foxes White Chocolate
At time of writing, the cost of a pack of Foxes White Chocolate luxury biscuits is £1.50, with you getting 8 biscuits in total. A box of Jaffa Cakes with 20 biscuits (or cakes, depending on what you believe) is £1.70. That’s 18p per biscuit for Foxes, 8p per Jaffa Cake.
For almost the same price, you get less than half the product, in essentially the same category. Definitely the same supermarket aisle.
And the beauty? The production cost on fewer biscuits is likely to be less while the perceived value on those is more, and the only real difference is marketing.
Marketing is what makes people pay the price they are happy with.
If you are trying to beat your competition on price, it is a race to the bottom, because I guarantee you they are trying to beat your prices too. So ignore the price. Focus on what you offer and adjust the price accordingly.
Remember, if you double your prices and lose half of your customers, you are earning the same amount of money with half the amount of work. That is one hell of an exchange.
People pay for quality even if the actual quantity is less. Think about high-end restaurants, and how we all joke about the portion sizes from those restaurants but they succeed because the quality of the plate is higher than a full plate of average food.
Have you ever tried Wagyu steak?
I am lucky and have had that steak before, and know 20oz cost nearly £500 in a restaurant. A 20oz fillet steak of normal beef, which is often regarded as a restaurant’s best cut, is usually around £60-70. People pay for quality.
You’ve never seen an advert on TV for a Rolls Royce, and that is by design. Their brand quality is so high that you don’t need to see adverts. Every other advert on TV is either a Ford, Renault or Peugeot.
So, what would you and your business rather be, a Ford or a Rolls Royce?