{"id":2368,"date":"2022-03-08T13:10:16","date_gmt":"2022-03-08T13:10:16","guid":{"rendered":"https:\/\/coupontoaster.com\/blog\/?p=2368"},"modified":"2026-03-28T16:25:43","modified_gmt":"2026-03-28T16:25:43","slug":"price-is-what-you-pay-value-is-what-you-get","status":"publish","type":"post","link":"https:\/\/coupontoaster.com\/blog\/lifestyle\/price-is-what-you-pay-value-is-what-you-get\/","title":{"rendered":"Price is What You Pay, Value is What You Get"},"content":{"rendered":"\n<p>This is the famous quote from American investor Warren Buffett from 2008.\u00a0 It\u2019s a principle that guides his investment choices, which has led to good levels of profitability.\u00a0However, it can be applied not just to investments but to any business providing a product or service.\u00a0\u00a0<\/p>\n\n\n\n<p>Knowing the difference between price, cost and value can increase profitability. Many see them as the same thing, however:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>the\u00a0<strong>cost<\/strong>\u00a0of a product or service is the amount you spend to make it<\/li>\n\n\n\n<li>the\u00a0<strong>price<\/strong>\u00a0is the amount you receive for providing the product or service<\/li>\n\n\n\n<li>the\u00a0<strong>value<\/strong>\u00a0is what your customer believes the product or service is worth to them.<\/li>\n<\/ul>\n\n\n\n<p>For example, the cost for a plumber to fix a burst pipe at a customer&#8217;s home may be \u00a35 for travel, materials costing \u00a33 and an hour&#8217;s labor at \u00a315. However, the value of the service to the customer\u00a0is far greater than the \u00a323 cost. The service may have prevented damage caused by a leak. The plumber may choose to base his price on value instead of cost and charge the customer \u00a350.<\/p>\n\n\n\n<p>The cost and the price of a product will be set by a business, however the value is arbitrary and depends on market forces.&nbsp;A number of factors will influence the value of a product or service.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Characteristics of Value<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li><em><strong>Value varies from person to person.<\/strong><\/em><\/li>\n<\/ul>\n\n\n\n<p><strong>For example:<\/strong> For a person suffering from poor eyesight, glasses are invaluable, but if a person\u2019s eyesight is perfect, the value of glasses to him would be zero. So value is dependent on the need and usefulness to the person, at a certain point in time.<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><em>Value varies from time to time.<\/em><\/li>\n<\/ul>\n\n\n\n<p><strong>For example: <\/strong>The value of a book for a student before the exams is greater in comparison to the value of the same book, after passing the exam.<\/p>\n\n\n\n<ul class=\"wp-block-list\" start=\"2\">\n<li><em>Value is dependent on supply and demand.<\/em><\/li>\n<\/ul>\n\n\n\n<p><strong>For example:<\/strong> Suppose there is a house for sale in a desirable area. It has a lot of interest, which reflects its demand. As the supply is less, and demand is more, the value would be high.<\/p>\n\n\n\n<ul class=\"wp-block-list\" start=\"3\">\n<li><em>Differs from one place to another<\/em><\/li>\n<\/ul>\n\n\n\n<p><strong>For example:<\/strong> The value of warm clothes will be higher in cold areas, as compared to a tropical area.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>How Businesses Can Provide Value<\/strong><\/h2>\n\n\n\n<p><em><strong>There are several steps you can take to provide perceived value to customers:<\/strong><\/em><\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Transparency <\/strong>\u2013 show exactly how your products are made so that customers know they are getting good quality.<\/li>\n\n\n\n<li><strong>Outstanding customer service<\/strong> \u2013 listen to your customers and ask for feedback.\u00a0 If they feel valued, they will perceive your products or services as having a higher value. <a href=\"https:\/\/www.salesforce.com\/blog\/customer-service-stats\/\" rel=\"nofollow\">80%<\/a>\u00a0of customers state that a positive customer experience is just as important as a company\u2019s products or services.<\/li>\n\n\n\n<li><strong>Assess the competition<\/strong> \u2013 what are they providing and how can you do it better? Nowadays, almost all customers do\u00a0some<em>\u00a0<\/em>kind of comparison research before making a purchase. So, if you can offer any benefits that your competitors don\u2019t, it makes it much easier to demonstrate value because you know what customers need and what others are offering.<\/li>\n\n\n\n<li><strong>Display customer testimonials<\/strong> \u2013 people give the word of others a much greater weight than just going by what you say.<\/li>\n\n\n\n<li><strong>Create an online community<\/strong> \u2013 where customers can interact with you and other customers.\u00a0This will show you value them as customers and will, therefore, make them perceive value in their VIP status.<\/li>\n\n\n\n<li><strong>Become an authority in your field<\/strong> \u2013 if you create and share content that customers find useful they will begin to see you as an expert to be trusted.\u00a0 This will add value to your products or services.<\/li>\n<\/ul>\n\n\n\n<p>Value doesn\u2019t necessarily mean cheap, although the terms are often used to mean the same thing. Often something is perceived to have greater value the more it costs.\u00a0And there is often some truth in this.\u00a0 We like to feel that we are getting good value for money when we make a purchase.\u00a0But buying low-cost items doesn\u2019t necessarily mean good value if they break or wear out within a year and need to be replaced.\u00a0It\u2019s actually better value to spend a bit more on something that will last longer.\u00a0\u00a0<\/p>\n\n\n\n<p>An example of this is <a href=\"https:\/\/www.quadrant2design.com\/\">Quadrant2Design<\/a>.\u00a0Their exhibition stands are not the cheapest on the market.\u00a0But by paying a bit more, you can be sure you\u2019ll get a product that will last much longer than a cheaper alternative. In addition to that, the company offers greater value in its customer service, being there for the customer at every stage of the exhibiting process.\u00a0So they provide more value than a company offering cheap, flimsy stands that they source elsewhere and providing no customer service.\u00a0 Quadrant2Design handles everything in-house, so you can be sure that you\u2019re getting a quality product.\u00a0\u00a0<\/p>\n\n\n\n<p><strong>Consider reading:<\/strong> <a href=\"https:\/\/coupontoaster.com\/blog\/visualizing-financial-concepts-in-the-complex-plane\/\">Visualizing Financial Concepts in the Complex Plane<\/a><\/p>\n\n\n\n<p>But a higher price doesn\u2019t always equate to better quality and, therefore, better value.\u00a0Some expensive clothing labels sell clothes that last no longer than their cheaper alternatives. You are paying for the label, which doesn\u2019t necessarily mean better value.\u00a0That\u2019s why it is a good idea to research a company thoroughly to establish if what they are supplying is of a quality that matches its price.<\/p>\n\n\n\n<p>Cost, price and value are often perceived as the same thing, but differentiating them can bring you better profitability.\u00a0Providing value to your customers will bring greater satisfaction and loyalty and ultimately lead to more customers through word-of-mouth.\u00a0<\/p>\n","protected":false},"excerpt":{"rendered":"<p>This is the famous quote from American investor Warren Buffett from 2008.\u00a0 It\u2019s a principle that guides his investment choices, which has led to good levels of profitability.\u00a0However, it can be applied not just to&#8230;<\/p>\n","protected":false},"author":1,"featured_media":2370,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[80,20],"tags":[],"class_list":{"0":"post-2368","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-finance","8":"category-lifestyle"},"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v23.7 (Yoast SEO v27.2) - 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