By Jeff Shore
A new pair of Salvatore Ferragamo burnished leather loafers will cost you $960. A new TAG Heuer watch will set you back a grand (starter watch). A Ferrari 458 comes in at $250,000 (that’s for a used version, of course).
But wait. Ferragamo? They’re just shoes. I’m wearing a perfectly acceptable pair of dress shoes right now that cost me less than $200.
TAG Heuer? My Skagen watch gets compliments all the time…at just $150. (I can’t spend a lot of money on watches; I’ve left a half dozen sitting on speaker lecterns over the years!)
And what’s wrong with my Infiniti, by the way? Four wheels, engine, brakes, steering wheel – just like the Ferrari.
How can some items be so much more expensive and yet find their niche in the marketplace?
There are two types of value that make up the price of an item: the intrinsic value and the psychological value. (Actually, these two things reside on a value scale, but I’m keeping this simple to make the point.)
Intrinsic value speaks to function, utility, components, manufacturing, etc. I need a watch that tells the time, that looks stylish, and that does not cost a fortune to manufacture.
Psychological value speaks to emotion, joy, pride, status, ego, etc. All these things are exceedingly difficult to quantify, but that does not make their value any less real.
The fact is that there is a psychological value attached to any product or service. How that value translates into dollars is difficult to measure, because the subjective nature of a customer’s “want it” factor is all over the map.
Enter the top performing salesperson.
Why Superstar Sales Pro’s Are So Totally Worth It
What a customer is willing to pay is a direct reflection of their emotional altitude. Great salespeople have a way of maximizing that emotion.
Every one of us has, at some time or another, surprised ourselves by paying more than we thought we would for a product, service or experience. This purchase event probably had an internal dialogue that sounded something like, “You know what – I’m worth it. I know it’s a lot, but I owe it to myself. And I know I never said I would spend this much, but dang it – I’m doing this for me!”
Do you hear the emotion?
Next question: did a salesperson assist you in that emotional journey? Because, that is what great salespeople do. They help their customers to realize the emotional value in a product, service, or experience.
Higher Price = Higher Emotion
Psychologist Peter Noel Murray has deeply researched the emotional elements of a purchase decision and discovered a very specific connection between the price of an item and the level of emotion that is present. If you are selling a high-end item, you must engage the emotion. Period.
That is what great salespeople do. They help their customer to become fully engaged emotionally. They give permission for their clients to be emotionally engaged. They understand their customers well enough to know the emotional hot buttons.
How much are you invoking that emotional element? You’ll need to if you want to change their world.