FAQ: How can I get my customers to pay more for my products?
Answer: This is about getting customers to think about price as only one aspect of what they are buying. In mature markets or when competition becomes fierce, particularly as the economy is turning down, companies find it difficult to focus on anything other than price. These are the signs that we are well into the mature stages of the product life cycle.
But there is a way out of this. Research has shown that the 'core product' or service accounts for 80% of its costs but its impact is only 20% of the customer's whole perception of the product. There are not many things you can do with core product to make it different. However, the 'soft issues' in the outer ring of the diagram below, which focus more on 'softer' service issues, may only account for 20% of costs, but the impact of these can be 80% of customers' perception of the organisation or its product/ service.