In the video below, Scott Keffer explains Perceived Value at the Double Your Affluent Clients Bootcamp event.
Perceived Value is in the Eye of the Beholder
(Below is the transcript from the video.)
Let’s talk about value. What is value?
Real or perceived, which matters?
Really? So, I’m wearing a Seiko Quartz watch. It tells time regularly until the battery goes bad or the band breaks, but it tells time. Which I love it, it’s kind of thin, and it tells time. Which I always thought that’s what a watch is for. I think it was $200.00.
Seemed reasonable. There is a Rolex Cellini. Kind of looks like my Seiko. Now I heard it tells time too. It’s $4,000.00. That’s interesting. It’s 2000% more. I like my Seiko, but people paid 2000% time more for the Rolex Cellini. There’s a BMW 750LI, beautiful car. Amazing car. It’s $100,000.00. It sits on the same frame as the Rolls Royce Ghost Series II. The Rolls Royce Ghost Series II is $300,000.00. Now I think they’re both cars.
They both take you to the mall, the airport, or the grocery store. But, people pay $300,000.00 for the Rolls Royce Ghost Series. I thought, “That’s kind of interesting.” 300% more for a car. Now maybe that car does something that other cars aren’t willing to do.
Oh, but here’s the Rolex Oyster Perpetual GMT-Master II Ice Watch, which is more than the Rolls Royce car. I’m still thinking, “Now, that does have a date.” So now I’m paying 150% more for the Rolls. Does any of this make sense? No. Okay. Does it need to make sense to you? No. What you need to understand is, this is the world in which you operate. You can say, “Well, it’s just a watch, it just tells time, who cares?” But understand there’s a reason people pay 150% more than a Rolls for a watch. What is it?
It isn’t for time, and it isn’t for date. Because perceived value is in the eye of the beholder, right? There’s a huge lesson here. If you miss it, you miss the understanding about all the core marketing. How many have a diamond ring here? Raise your hand if you have a diamond ring. How many think that what was paid for that diamond ring is worth more today, how did a stone become that? Because De Beers crafted a story in the 1930’s about a diamond being forever. I’m guessing that diamonds are not forever, only God is forever, but diamonds are forever, so people pay a lot for them.
They crafted a story. Everybody get it? They created perceived value. Now you can like it or not, you can think it’s goofy or not, but understand that is how the marketplace works.