I am curious as to the reality of ‘prestige pricing’, and the amount of sales that can be attributed to this kind of sales model, in this present business climate.
As an example let’s take the wonderful world of Dyson and their range of products; which incidentally now includes and hand dryer/tap combo (Dyson Launches all-in-one hand drying Airblade water tap).
They seem to have an innovative ethos and every few years release a product that seems to be based on the ‘Build a better mousetrap’ mentality. These all have ‘iconic design’ (apparently!) and include vacuum cleaners, fans, hand dryers and heaters all priced at stupid levels (in my opinion).
For example, lets take the Dyson bladeless fan heater and a standard fan heater. I found a standard 2Kw fan heater on Amazon for £9.85, the Dyson is on for £288.49. That’s a staggering 29 times the price of the cheaper heater! 😯
What amazes me is the fact that these products sell at these levels.
I’ll tell you a little story of the time I was living and working in London. As a little background, I was working in the ‘square mile’ for Compaq at the time, and there were some very ‘well-to-do’ people working there…
Whilst out on a Saturday morning shopping trip, we discovered in a little housewares shop, some chrome plated serving spoons – priced at around the £2 each mark – so we decided to buy a couple.
Sometime in the subsequent week I was talking to one the girls in the office about the weekend and she said that she and her significant other were shopping in the city centre and popped in to Selfridge, where they had purchased some chrome plated serving spoons – priced at the £40 mark for 3.
When I told her about the self-same things I had bought for just £2 each, she said that hers must be much better “because they were so much more expensive”.
… And I think that just about sums up the psychology of the prestige pricing model.
For me, I look to the features and benefits of the product, before I look to the design. Only when I’m satisfied that it will perform do I start to look to the aesthetics of whatever it is.
For others it would seem that the design, and the perceived ‘quality’ of the product is reflected in the price, and that the design is a huge part of the buying decision.