Wine sommeliers often can’t tell the difference between a $20 bottle and a $2,000 bottle in a double blind test. The food at the $20/person restaurant and the food at the $200/person restaurant. The beer at the top rated brewery or the guy brewing in his basement.
In a double blind test – who has the better service?
It doesn’t matter. It’s never a double blind test. There are always so many more factors at play. Remember the following:
People aren’t just buying a service – they are buying a feeling.
Some people are willing to pay for status and often get more intrinsic value by paying more money for similar services.
There is a lot of perceived value that comes along with a higher price. Its a placebo effect that makes people FEEL like they are getting more for their dollar.
I’m not suggesting you price gauge people and try to rip them off around every bend. Just realize you can choose to compete in many many ways. Don’t make the choice to compete on price.
This week on the podcast
On Monday’s podcast episode I tell the story of graduation weekend in 2012 when I made $10k brokering rooms. On Wednesday I talk about craft beer in New England!