Perception is Reality: How Expectations Shape Our Experience of Products

Perception is Reality: How Expectations Shape Our Experience of Products

Kyle Hoffman, Director of Growth Strategy | June 15 2023

When it comes to our perception of product quality, expectations play a pivotal role. The way we anticipate and imagine a product can significantly influence how we experience it, and in some cases, even alter our senses, making things taste better or appear more luxurious.

While it may seem like consumers are passive recipients of marketing messages, in actuality, we are active participants in creating our own reality. The old saying is true: perception is reality.

Ecommerce brands fight fiercely for consumers’ attention and loyalty, and setting the right expectations becomes paramount to winning over buyers. From premium pricing to thoughtful design, from the allure of origin to the cultivation of positive sentiment, each element comes together to create a story that captivates and convinces consumers.

The power of perception can be a strategic tool for marketers. In this article, we explore how ecommerce brands can leverage pricing, origin, design, and more to establish positive expectations with buyers and enhance consumer satisfaction.


Impact of Price on Perceived Quality


Price is a factor that significantly impacts our perception of product quality. When we expect something to be amazing, it tends to be better. It’s part of why luxury goods give us a high and why expensive dinners taste better. This self-fulfilling prophecy highlights the power of our expectations.

One effective way to shape consumer expectations is by pricing products at a premium. We often assume that a product must be of high quality if it is expensive. The relationship between price and quality influences our perception and predisposes us to perceive the product as superior.

This theory was proven true by researchers at Standford GSB and the California Institute of Technology. During a study to show the impact of pricing on perceived quality, participants were informed they were tasting two different wines – one priced at $5 and the other at $45. However, they were unknowingly consuming the same wine in both instances. Researchers found that the brain’s pleasure center showed heightened activity when participants believed they enjoyed the more expensive vintage.

Higher prices are often associated with exclusivity and quality, and in most cases, lead to higher customer satisfaction. We see this in the luxury goods industry. Luxury brands like Rolex, Cartier, and Louis Vuitton use price to influence consumers’ perception of quality. These brands effectively position themselves as the top of the product, cultivating an image of luxury and craftsmanship, and creating a perception that their products are of superior quality and style.

While many luxury brands utilize premium pricing to shape consumer expectations, there are other more affordable brands that have successfully employed premium pricing strategies to elevate their status.

For example, Aesop, a skincare and beauty brand, has leveraged a premium pricing strategy and gained a reputation for its high-quality, premium products. Their products are intentionally set at a higher range than mainstream skincare brands to position the brand as luxurious and of the highest quality. To some, $41 for soap may seem outrageous when you can get a similar product for less than half. However, Aesop understands their target customer seeks out an indulgent self-care routine. By positioning itself as a brand that provides moments of daily luxury and comfort, Aesop effectively shapes consumers’ expectations and establishes itself as a symbol of personal luxury.

Starbucks has taken a similar approach to stand out in the coffee industry. The brand is known for charging higher prices compared to many other coffee chains. As a result, Starbucks has positioned itself as a purveyor of high quality. Like the Aesop example, Starbucks targets consumers looking for an attainable daily luxury.

Key takeaway: Price can influence consumer expectations and shape the perception of product quality. By employing a premium pricing strategy, brands can establish a sense of exclusivity, desirability, and enhanced value.


The Impact of Provenance on Reputation and Perceived Quality


Whether it is Swiss watches, Italian leather goods, French perfumes, or California wines, the impact of provenance, or origin, on perceived product quality is undeniable.

Consumers often associate products from certain countries or regions with a sense of sophistication, craftsmanship, reliability, and authenticity.

For example, during a study by two Cornell professors, a group of diners in an Illinois restaurant were served a complimentary glass of Cabernet Sauvignon with the same fixed-price French dinner. All were told the wine came from Noah’s Winery, a non-existent brand. However, half were told the origin was California, while the other half was from North Dakota. All of the wine was a very inexpensive Charles Shaw.

Which wine do you think diners preferred? Of course, participants chose the wine from the highly regarded California wine region. However, even more interesting, the diners who received the California wine rated the food higher, ate 11% more food, and were more likely to make a return reservation.

Why does origin have such a powerful impact on consumer perceptions?

Consumers are more likely to believe that products from renowned origins possess superior characteristics and adhere to strict standards. For example, we tend to associate quality with the Japanese, and brands like Sony and Panasonic have capitalized on Japan’s reputation for technological innovation, reliability, and attention to detail. Similarly, watch brands like Rolex and TAG Heuer have leveraged their association with Switzerland to create a perception of exceptional quality, precision, and luxury.

Key takeaway: The impact of origin on perceived quality can be a powerful marketing tool. By aligning themselves with a specific region or origin renowned for certain expertise, brands can elevate the brand’s reputation, tap into consumers’ preferences, and influence customer satisfaction.


The Influence of Product Packaging and Design Aesthetics


Consumers are notorious for judging a book by its cover, often making judgments and decisions about a product based on its aesthetics or packaging. Even children as young as preschool form judgments based on a product’s packaging, perceiving brand-name items to taste better than generic alternatives.

High-quality packaging communicates a sense of value and craftsmanship, and consumers tend to associate a product with higher quality, attention to detail, and premium positioning when the product is presented in a visually appealing and well-designed package.

This isn’t just logic – it's backed by scientific research. In a notable study on aesthetic package design, researchers found through a series of experiments that consumers prefer attractive packaging. Moreover, consumers showed preference for products in attractive packaging over standardized packaging even when it cost more, or it was an unfamiliar brand.

Using brain scanning technology, the researchers discovered that attractive packaging lights up areas of the brain associated with the reward system. Like attractive objects, attractive packaging stimulates the reward system, prompting consumers to make decisions based on emotional, not rationale.

This is why it’s so imperative for brands to create a great first impression with aesthetically pleasing packaging that captures attention and lures people in.

Several brands emphasize aesthetically pleasing packaging as part of their brand identity to attract consumers and enhance customer satisfaction.

For example, Tiffany & Co. has arguably one of the most iconic packaging designs with their signature blue boxes that have been around since the mid-1800s. They even trademarked the color as Tiffany Blue. The company’s packaging design, like its brand, has become synonymous with beauty and opulence, and has solidified the brand as one of the most coveted jewelry brands in the world.

Aesthetically pleasing packaging plays a pivotal role in the cosmetics industry, where brands are in fierce competition to win over consumers at the beauty counter. Consumers not only want a great product when it comes to their cosmetics, but they want a great experience every time they go to use the product. That’s why brands like Dior, YSL, Chanel, Fenty Beauty, and Charlotte Tilbury go out of their way to invest heavily in a product’s design and packaging. Packaging lures the consumer in, and the product keeps us coming back for more.

Perfume brands lure in consumers with their aesthetically pleasing designs, too. Jo Malone, a British fragrance brand, is renowned for its visually appealing designs with their signature cream and black color scheme exuding elegance and sophistication. From their product packaging to their beautiful fragrance bottles, Jo Malone’s sleek designs create an elevated experience for their customers.

Smeg has carved a niche for itself in the home appliance industry by creating appliances that are not only high-performing but visually appealing, too. The retro-inspired designs make their iconic ovens, toasters, kettles, and more stand out in any kitchen, appealing to the discerning customer looking to add a touch of vintage charm to their home. The brand has successfully leveraged aesthetically pleasing designs as part of their product design.

Key takeaway: From typography, color, form, and function, product packaging and aesthetically pleasing designs not only attract customers but enhance their overall experience, making them a key element in any branding strategy.


Brands that are Leveraging These Psychological Tactics Well


Several brands have effectively harnessed all three behavioral science tactics -- premium pricing, provenance, and luxurious packaging -- to establish themselves as premium brands in the marketplace.

Notably, Grey Goose Vodka created a premium brand by setting a higher price point than its competitors, influencing consumers’ high-quality expectations. Furthermore, the company leveraged its French heritage to shape consumers’ expectations and add to the brand’s perceived quality. By combining several psychological tactics such as price, provenance, and luxurious packaging design, Grey Goose successfully positioned itself as a premium brand, differentiating itself from competitors in the vodka market.

Like Grey Goose Vodka, Dom Perignon has successfully employed these tactics to solidify its premium positioning in the alcohol beverage industry. The champagne’s high price point, elegant packaging, and connection to the region of Champagne in France contribute to its reputation as a premium brand, further enhancing its perceived value. Today, Dom Perignon is a brand that represents luxury and celebration.

Diptyque, a luxury fragrance and home goods brand, places great emphasis on aesthetic appeal, and has successfully leveraged pricing, provenance, and other psychological tactics to position itself as a premium brand. Its product packaging features elegant, minimalist designs with intricate patterns and delicate typography. The luxury brand leveraged a premium pricing strategy ($74 a candle) and successfully leveraged its county of origin in France. The combination of visually captivating designs, premium pricing, and promotion of provenance differentiates Diptyque, making their offerings stand out and perceived as high-quality and valuable.

YETI is another example. Known for its high-performance coolers, drinkware, and outdoor gear, YETI’s combination of a premium price point and innovative and striking designs have positioned YETI well in the marketplace. Furthermore, the company emphasizes its Texas roots and the rugged outdoor lifestyle associated with the region, appealing to its core audience of outdoor enthusiasts, travelers, and adventure-goers.


The Power of Perception in Shaping Consumer Experiences


Marketing tactics like premium pricing, leveraging provenance, and attractive design play an essential role in shaping consumer expectations because it works on a subconscious level, influencing consumer decision making and the perception of product quality. Premium brands like Grey Goose Vodka, Diptyque, Dom Perignon, and Yeti have successfully employed these tactics to position themselves as leaders in their respective industries.

Direct to consumer brands can successfully employ these strategies to tap into consumers’ minds and enhance the perceived value, desirability, and overall satisfaction associated with their product offerings.

Want to learn more and apply these tactics to your brand? Function Growth is a team of direct-to-consumer experts and marketers who snap into brand-side teams to accelerate growth. With a proven track record of using behavioral science with some of the fastest-growing brands in the country, we can help take your brand to the next level. Get in touch with us today.

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