In a recent article for Entrepreneur, Pratik Dholakiya (@DholakiyaPratik) discusses the technique that customers use to shop. What really distinguishes one product from another? What makes the “I want this” alarm go off in their head?

Dholakiya answers these questions with a variety of reasons. First off, consumers will choose a brand if they already know they like the brand. Through physical and psychological evaluation, the consumer makes a decision about a brand based off of non-standard criteria. One influential factor is if they like the company that owns the brand, they would endorse any product. Any consumer, if more aware of the history and lineage of a brand they like, will be more willing to buy it. Because of this connection, they might be more likely to pay more for the company’s products.

Another benefit of knowing the brand’s company is to ensure getting value. Consumers tend to buy products from companies that they know hold high standards and deliver value. However, they could be sticking to the company because of the tendency to resist change. People happy with the current functionality of a product won’t see a need to change. Consumers also tend to go for simplicity. They will go for a product regardless of price if they are confident it will simplify their life.

Companies only have the power to justify a price premium if their customers view them to be exceptional and different from any alternative. If a company is not meaningful to the consumer, people will have no emotional connection with their purchase. After all, consumers are paying for the whole product experience.

Premium customers don’t have to be rich -- most people save their money to buy good products. A premium customer pays you the full price and expects top-notch quality and customer service in return. The challenge for these brands then is to sustain their uniqueness from others.

Moral:

If your product is promoted correctly and offers a meaningful and unique experience, don’t be afraid to sell it at its high price -- but make sure you believe in your product.