Saturday, March 24, 2012

The Business Chat - Perceived Value

In January 2007 world famous violinist Joshua Bell, posing as a street musician, gave an incognito performance to morning commuters at a metro station in Washington DC. The world famous violinist performed beautiful and complex music on an instrument worth $3.5 million, but nevertheless received only cursory attention, or none at all, from the majority of commuters who passed him by. Only days earlier Bell had played at a Boston theater where tickets sold out at an average price $100 each. In his subway performance he only made a paltry $32.
This was an experiment arranged by the Washington Post. Journalist Gene Weingarten was awarded a Pulitzer Prize for Feature Writing for his outstanding and thought provoking analysis of the experiment. Weingarten examined the role that context plays in our artistic perceptions and to what degree our perception of beauty is influenced by our mindset at the time we perceive it.
These are interesting philosophical arguments and while fascinating I would like to add another, more practical, interpretation.
If someone pays $100 for a ticket they expect a quality performance. They expect excellence. They expect the best instruments, the best acoustics, the best of everything. Is it the best? Maybe, maybe not. Is the listener even able to judge the quality of the performance? Maybe, maybe not. But even if they are tone deaf and sleep through the whole performance they will feel like they have received value. Because they paid $100.
If someone sees a musician performing on the street for free, they see what they are paying for. It’s free, how can the musician be any good? They have pre-judged the quality before listening and may not even bother to listen. Many who attend both events really aren’t qualified to tell if music is good or bad and they judge by the ticket price.

This is why you cannot afford to underprice your creative work. By underpricing your work you are telling the public that it is not of good quality or value. While many of your customers may truly appreciate the real value in your work, a percentage of the buying public really has no idea of what goes into creating a work of art. They see the price. And if the price is ridiculously low, then they see it of no value. You devalue your brand.
Of course there are some who stop and listen and can truly appreciate the work for what it is. However if you are counting of finding an audience filled with the true believers to buy your work and pay your rent then start looking for space on a subway platform.

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