When is a higher price better? When it adds to the experience?

There was an article in the UK Sunday Times on 13 January 2007 with the headline "High price makes wine taste better". The article itself provided a lot of food for thought about the role of pricing and its impact on the perception of quality.

It underlines (of course) the importance of price not only in determining margin - but as a tool itself as part of your product experience.

The article was about a study by the California Institute of Technology. People were given identical glasses of wine and told they cost different amounts. The one with the higher price was rated by drinkers in the study as giving them more pleasure. A fact confirmed by brain scans - so it was real (as it were)!

The thing that also struck me was the comments by people in the wine industry (such as ripegrapes.co.uk) who said that this was a well-known fact - but also the same could be achieved when wine was served in better environments, better glasses and other environmental and experiential factors.

The point being that it is the totality of the consumer's experience of a product and brand that is important. All to often we marketers focus on the parts - rather than the sum of the parts - when thinking about our product. We need to look at every aspect of how the consumer interacts and consumes our products and brands. Too often we forget that! (I have written about this before when talking about why I stopped buying Dell computers).

What do you think? Leave a comment on the posting or drop me an email!