Perceived Value is Real
DEFINITION of ‘Perceived Value‘ The worth that a product or service has in the mind of the consumer. The consumer’s perceived value of a good or service affects the price that he or she is willing to pay for it.
I don’t know how long ago I realized this or exactly when I started putting into practice in my eBay business, but I feel like I have had to really convince people it is a real thing.
In my circle of eBay friends, my Meet-Up Group and the Facebook group The Thrifting Board I help run and admin, I teach about it all the time. When someone reaches out and asks for help with their listings one of the first things I usually have them do is increase their prices. In one recent case I suggested the seller increase their prices by 90%! The prices in this store were so low that I had to do the math and explain the time and effort this seller was putting into each listing was yielding him less than $2 to put in his pocket. Thrifters are so used to finding items for under $10 that I believe they don’t think others would pay $99.99 for a pair of jeans they picked up for $7.99. It is my observation that stay-at-home moms often under price their items as well since it’s hard for them to put a dollar amount on their time.
If you’re going to sell online you need to understand your costs and value your time. Listing on eBay does take time if you do it right. You also need to be patient and wait for the right buyer to come along. Listing something for a week, relisting it once and then lowering the price is not the most effective way to be a good seller (in my humble opinion). I just tested out the reduced price theory by putting EVERY item in my store that was priced over $20 on sale for 10% off. I did this for four days to see if I could drum up some business. Of the nearly 2600 items I had on sale, I sold two. Just two items. This is often the case when I run a sale. If your business model is to list an item for a week or two then put it on sale, you believe that the only reason someone is buying your item is because of price. I’m here to tell you there are so many other factors….and believe it or not, some buyers may look at your reduced item and assume there is something wrong with it. These are the buyers I love!
I don’t have any scientific information or hard core data to back this, I just know it works for me and when I teach it to others it works for them too.
Here’s an example of one way I use perceived value to my benefit. I listed this coat on November 14th at $74.99. I don’t usually spend a ton of time researching but I did on this one. It’s pretty heavy and I wanted to see if I could learn anything about why it was so heavy. Was it a special type of hunting coat? Was it made for really cold climates? I didn’t know and I couldn’t find another one like it on eBay, Google, Cabela’s, etc. When I moved it to inventory storage I thought to myself, this is REALLY heavy. The next time I looked at my listing I saw it had one watcher and I thought, I need to increase the price, so I increased it to $99.99. Then I got two watchers and the next day or two I decided to go and review the prices of all my winter coats. I increased most of them….some by $10, several by $30. I pushed this one to $114.99 and it sold on November 20th, just one week after it was listed. It’s going to VA which makes me glad I didn’t sell it at my original $75 due to the extra shipping costs. Don’t be afraid to price your items for what they’re worth and if you’re not sure, price it higher than you think and let it stay for 30-90 days before thinking about reducing the price.