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How do people judge the value of products and services? What are the key factors that underpin customers’ buying motivations?
People judge the value of products/services in the context of their life’s circumstances. If they’re not happy with their situations, they will be most receptive to solutions that claim to alleviate their problems. If, on the other hand, they are happy, they won’t deem those solutions valuable.
Keep reading to learn about the key factors that influence customers’ purchasing decisions.
How People Judge the Value of Products and Services
Kaufman argues that people’s buying motivations change according to their circumstances—they’re receptive to different offers at different times depending on how relevant these offers are to their situation. For example, someone who’s happily married is less likely to see the value in services that facilitate romantic connections and won’t be as receptive to these services as someone who’s just been through a divorce.
Further, Kaufman argues that even if people would like to improve or change their circumstances, they’ll only be receptive to offers that claim to help them if they’re uncomfortable with their current situation. This is because people are more motivated to move away from discomfort than they are to move toward comfort. So, if they’re comfortable with their situation, they won’t feel compelled to introduce changes into their lives. However, if they’re uncomfortable, they’ll be motivated to seek solutions to find some relief.
For example, if the recent divorcee would like to date but is currently comfortable being single, she won’t be motivated to seek out a partner. As a result, she’ll be less receptive to dating services than someone who hates being single.
Even when people are receptive to your offer, they won’t consider purchasing it until they’ve assessed how valuable it is to them. According to Kaufman, people judge the value of products and services in two ways:
- Objectively: Does it meet all requirements? Is it reliable? Is it cost-effective?
- Subjectively: How does it make me feel? How does it impact how others feel about me?
Various Factors Influence Receptivity and Perception of Value
While Kaufman’s ideas about motivation, receptivity, and value are valid, they offer only a partial, surface-level view of what influences people’s buying decisions. Marketing experts expand on his thoughts with a more in-depth explanation of what influences consumer decisions. They identify four influential factors to help you better understand how different people judge the value of different offers.
Individual factors: This includes a person’s occupation, age, economic status, lifestyle, personality, and preferences. For example, the recent divorcee wants to find love but isn’t receptive to dating services because she’s worried about how much it will cost, believes that she’s too old, or would prefer to meet someone without using an intermediary.
Psychological factors: This includes their drive to meet a certain emotional need, such as comfort, how susceptible they are to external influence, how skilled and knowledgeable they are, their attitudes and beliefs, and their prior experience with similar products and services. For example, the recent divorcee might devalue and automatically ignore dating services because she doesn’t know anyone who’s successfully found love through them.
Social factors: This includes what their culture, social class, religion, family, or the type of people they want to associate with think about the products and services in question. For example, the recent divorcee might want to sign up for a dating service but fears how her family will judge her.
Cognitive factors: This includes how willing they are to expose themselves to new and relevant information so that they can think objectively. For example, the recent divorcee might assume that she’s right about how useless dating services are and choose not to proceed. Or, she might engage in research so that she can make a more informed decision.
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