Quebec Valley

December has been here for a few days now and here’s a little story which will help you understand the importantce on setting your product price to an appropriate level and how to judge if the price is set properly. This is totally unscientific but you’ll quickly realise what I mean.

Like most, if not all, car owners I had to buy a set of winter tires. Like most CFO’s would do, I did some price comparision only to find out how incredibly price fluctuates from a vendor to another. Not only price but price/quality. You see, I read a lot of tire reviews from all type of sources, read consumer reports and so on. I set my mind on a specific brand and looked around.  While I won’t say the names of the stores I visited, let’s say that the first one is a Canadian store and they sell tires. They didn’t have my brand but offered me “a comparable quality”. So I got my first quote, and my first shock. I then decided that there’s a better way to get quotes: let’s go back home and surf. 

Now buying tires online in Canada is not quite there yet. You’d think that with the law forcing Quebecois to buy tires that there would be a tires-r-us.qc.ca but there’s no such thing. Disappointed I was. I finally managed to find tires and rims for my car. Close to 1000 dollars for 4 pieces of metal and 4 blobs of soft rubber. Ouch! I took a closer look and estimated that the technology behind the rims is probably 75 years old (basic metal molding) and the tires, well that’s hard to tell as we can’t see inside the tire. Still, it’s pretty hard to tell that each tire is worth over 150$ a piece.

About the same time, I bought a new SLR camera. Unlike the snow tires, I’ve been wanting to get one for quite some time and managed to get a “good deal”. I also paid about 1000$ for the camera and I felt so much better buying a 1000$ camera than 1000$ worth of tires and rims. 

Why?

Because “I can see what I’m buying”. I can see the value and the technology behind the camera. I know that the camera maker invested millions in research and development, that they worked hard on optics, making the body as small as possible without compromising image quality and so on.

Did I get the same feeling with my tires? Hell no. In fact, I felt insulted that I had to pay 1000$ for basic, almost raw, material. Even though I opted for top quality tires, I feel that they look no better than cheaper tires from that Canadian store.

So with this in mind. When you try to sell a product, make sure you sell not only quality but a feeling of recomfort. Make sure your customers are getting the same value and feeling than when I bought my new camera.