The prices, well… It’s Le Parker Meridien. Will put it this way – A standard omelette will run you about the price of a chicken dinner entree at a 4-star restaurant.
I had the blueberry pancakes (pictured above) – they were priced comparably, and they were amazing! And there was ‘unlimited’ orange juice – albeit freshly squeezed orange juice… for $9 bucks a pop. But the orange juice- was amazing!
Were those pancakes and juice REALLY worth $40?
Does part of our brain tell us – if I’m going to pay almost $10 for orange juice, my tongue is going to detect every slight nuance of velvety citric-sweet goodness? Most people don’t yearn to say – ‘I wasted $9 on orange juice and it sucked’.
Price can actually have a direct impact on our enjoyment of a product – despite how it may look or taste. Wine is a product whose price can range from one to six digits for a single bottle. There are certainly nuances across each varietal and vintage, but those aside, there happens to be a study that has directly linked a consumer’s enjoyment of a bottle of wine to his or her perception of how expensive the wine is.
I’ve got to give credit to Norma’s – clearly there is power in the assertion of pricing. You could probably go three doors down to a hole in the wall takeout cafe on 56th St. and get an order of blueberry pancakes and a carton of orange juice for the same price as that ‘bottomless’ glass.
But… it’s Norma’s. They have a $1,000 caviar-covered omelette called the Zillion Dollar Frittata . If you are visiting NYC from, say, Dubai, have a little bit of money and a lot more ego, maybe you’re going to say – heck yeah, I’m going to spend $1,000 on an omelette at the storied New York institution Norma’s just to tell people I can!!!
Marketers in the luxury business, whether hospitality or durable goods, are masterful in creating intangible value that makes every penny spent on $10 OJ or a $10,000 bag justifiable. It could be helping customers relish in the experience of sipping orange juice in a legendary New York institution, or giving them the comfort of knowing they’re purchasing a bag made of the butter-soft leather of baby sheep who have been smothered in La Mer moisturizer from birth (that’s hyperbole… I hope).
Simply having the gumption to throw out an astronomical price paired with an intriguing product story, is part of the secret sauce that makes some willing to pay a premium for one brand versus another.
Pricing is an art and a science… and, admittedly, a struggle for some. As I’ve spoken to more people who are in the consulting business, their biggest challenge is pricing – and making sure they’re communicating and being paid their worth.
What do you think? Do you instinctively feel that something is ‘better’ just because it’s more expensive?