Provide an example where you compared a good or service by its value and perceived benefits and price. How did your assessment of value lead to a purchase (or non-purchase) decision?

 

Heres an example that I've experienced. Kind of silly, but actually reveals a lot about consumer behavior.

In a grocery store I went to the dairy aisle to get cream cheese. I had the options to get great value (walmart brand) or Philladephia (name brand). The great value brand was a whole dollar cheaper AND included 2 ounces more than the name brand. However, I still went with the name brand. So let's consider why? After all I'm a PhD student without a lot of income :) wouldn't it make sense to take the cheaper version?

What value factors went into my decision?

• Brand recognition (Philadelphia cream cheese is well known for its quality, it is the most recognized brand for cream cheese. Therefore I trust it and am willing to pay extra.)
• Packaging (the store brand was bland packaging square like, and no graphic design, yet the name brand had convex design to it, with pretty lettering sticker design. This appeals to the eye, the name brand can spend extra on packaging to compete, since it cost more)
• Taste (I know the ingredients are better in the name brand, I find greater marginal value in taste over the value I find in cost (saving the one dollar).

Overall, I know the name brand, I trust the name brand and thus I choose the name brand.