At SCG, we say there is always one surprise in any research project. This holds true when reviewing past projects, long since completed and filed away.

While looking through the Importance/Performance Queries (IPQ surveys) our agency conducted over several years across many industries, I was surprised to see such a consistent result regarding price: price is never most important unless there is nothing else to consider.

Nothing Else to Consider
The first question in our surveys is “what is the single most important factor to you when purchasing this product or service.” When unprompted, price is consistently mentioned most often — by up to half of those surveyed. Responses from the rest are scattered over a range of attributes. If you stop at this point, like many companies do, you falsely conclude that cost is king and price rules supreme. Proven by research, right? But look what happens when price has a little competition.

When Price is Put in its Place
Next, respondents are asked to evaluate the importance of a series of product or service attributes such as speed, selection, ease of use and price. In this section, price no longer leads the pack. Finally, in a third wave, respondents are asked “of the previously mentioned attributes, what is the single most important factor?”  Surprise! Price NEVER scores as high as it did with the first question. People who just minutes before confidently stated that price is the most important factor, now select other attributes. Why have they changed their mind?

Don’t Become a Commodity
While price obviously plays a role in any purchase decision, its relative importance is determined by what other factors are top of mind. If there aren’t any, price dominates. But when price is considered alongside other factors, it becomes much less influential. For a marketer, this leaves a crystal clear path. Communicate the distinguishing strengths of your product or service so you need not rely on price to compete effectively.

-Pat Henning

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