The difference between PRICE and VALUE


Convincing people to buy is not easy. Most people are not quick to part with their hard earned cash and so many consumers choose to buy products based on price, rather than the value of the product.

This may be because they don’t yet know or understand the value of the product, but if you can show them what the value is, that is key to creating buyers.

So, what’s the difference between price and value?

Price is what you pay for a product or service. It’s the amount on the price sticker, how much cash you hand over at the register.

Price is determined by a range of different factors, including production costs, transport, and mark ups.

Value is what the product pays you. This isn’t necessarily measurable or in money.

A product or service may give you time, such as a washing machine does. You pay for a washing machine to have more time to spend with your family, or reading, or doing whatever it is you enjoy. Most people believe that the free time a washing machine allows them to have, along with clean clothes and hygiene, is well worth the price.

A product or service may give you money, in a variety of ways. It may allow you to spend time working on more productive activities, which bring in money. It could help you to provide your customers with a better service which leads to more customers, or a more efficient way to run your business. If any of these result in a bigger profit for you, the item or service you purchased has now substantially increased in value.

A product or service may give you inspiration and the tools to achieve your dream. Does your happiness have a price, or is the value limitless?

In order to create buyers, you need to know what value your product or service can add to your customers’ lives. Once you can show them the value, the price will be of little concern to them.

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