‘X for $29.00’ is better value than ‘$29.00 for X”  In marketing, perception is reality. Consumers buy based on their perception – and that is the reality. The reaction of consumers to a price is rarely as rational as businesspeople think it is.  Research completed by Karmarkar, Shiv and Knutson involved giving participants $40 to spend and using […]

‘X for $29.00’ is better value than ‘$29.00 for X”  In marketing, perception is reality. Consumers buy based on their perception – and that is the reality. The reaction of consumers to a price is rarely as rational as businesspeople think it is.  Research completed by Karmarkar, Shiv and Knutson involved giving participants $40 to spend and using an MRI to monitor brain function during the purchase or decision-making process. Option 1               Showing the product and then highlighting the price Option 2               Highlighting the price and then showing the product The researchers found that when confronted with these options, the participants asked themselves different questions: Option 1               Do I like this product? Option 2               Is this product worth the price? Option one emphasized the product, while option two emphasized the price. As a result, participants asked very different questions. This is an important finding. Communicating value occurs much more readily when the…