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Economics is the study of incentives how individuals & systems respond. A common belief is value drives decision-making. When working with executives to discern why the sales component of the organization under-preforms or consistently misses targets, I start with a simple premise: people will by an inferior product for more money because they are comfortable with the people they do business with. This dynamic flies in the face of incentives. Try explaining it to organizational leadership wondering why the new widget they invested development, manufacturing & promotional monies to commercialize.
People are creatures of habit. No habit is more entrenched than one that provides comfort. The idea that anyone would pay more money and receive less value than could otherwise be had is confounding...on paper. In reality the unseen value is the relationship embedded within the transaction. It often provides, you guessed it, comfort to the purchaser. I usually point to the company's current sales to reinforce how this dynamic works in their favor. As you might imagine I'm not always the most welcome voice in a room! Suffice to say when an organization understands the embedded value of relationships - how they are built, managed and acknowledged - within their P & L, this serves as a gateway to innovation. Once that process is consistently engaged the sale not made becomes an opportunity to create the value that is incredibly hard to dislodge, no matter what they are selling. 3/9/2017 12:02:54 am
I agree with what this article has said. People will buy an inferior product for more money. It is because they are comfortable with the people they do business with. The idea that anyone would pay money is something a business man always considers because as everyone can see, not all people receives a rightful product and service. Sometimes, it is with the relationship of two people in the business.Satisfaction is not only seen with the product and service but also it is with what will happen after the transaction. We should give more value to people than with the money we'll receive in doing business. It will just reflect with the customers' feedback, so respond to them in a more polite way. 4/9/2017 04:53:33 am
People would buy a brand name. A good brand means a quality product. 5/8/2017 01:19:01 am
Economics is part of our everyday life. Well the thinking of the people is really weird, imagine they are willing to spend money on the product they are going to receive. They are not worrying about how much they are going to spend as long as that product or services is going to be worth it. That is the misunderstanding that everyone is doing because we shouldn't do that. Some product or services is not worth it to spend a large sum of money. We still have to evaluate the money because money nowadays was really hard to get. I mean we actually have to work hard before we acquire a large amount of money, then we are just going to spend it crazily. 8/9/2017 05:21:56 am
You make such a large number of extraordinary focuses here that I read your article two or three times. Your perspectives are as per my own generally. This is extraordinary substance for your users. 12/21/2017 09:03:02 am
There are lots of factors to consider why people buy a certain product. If the customer stayed on your product then maybe it is either he is a loyal long time user or either he really loves the product. People nowadays are wise enough to handle financial credibility. Some people does not focuses on the needs and wants of people but do the generalize business instead. It is really hard nowadays to gain money that is why we are wise now on how to budget and handle them well. Comments are closed.
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Author(s)Blair & Fell expounding, thinking, sharing, hoping, wondering. Archives
April 2022
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