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what i’ve learned from a little polka-dot dress

My mailbox is out of control. Every time I open it, there are piles and piles of promotional fliers from all kinds of retailers. Different retailers, but exactly the same message: best value! You can just switch the names on the fliers and nobody would notice the difference. There are not many differences in methods they use to deliver the value message: 50% off the original price, cash back, buy one get one free, free shipping, one day only special discount, etc. As a result of such promotional practices, consumers are trained to think that the lowest price equals the best value. I think this is the main reason why discount retailers like T.J. Maxx and Marshalls that offer rock-bottom prices are thriving in this economy.

But the truth is that low prices are not always the best indicator of value. Let me tell you a little story:

Ever since I was a little girl, my mom used to say to me, “Buy nice, not twice.” That’s why eight years ago, when I landed my first U.S. job interview, I splurged on a beautiful 100% silk polka-dot dress from Dillard’s. I got the job and the polka-dot dress became my favorite dress. Any time I need to look nice and professional, this dress is my “guaranteed good looks insurance policy.” I think every woman has a piece of clothing like that.

The best part is that, after eight years, this dress still looks and feels like new.

What does this story have to do with value? Well, let’s do a little math exercise:

I paid $140 for the dress eight years ago. And dividing $140 by 8 equals $17.50. That’s how much this dress has cost me per year. I know for a fact that there is no way I can buy or rent anything of similar quality today for $17.50.

Besides, don’t forget about the emotional equity – something that cannot be measured by money. Because emotional equity is the amount of happiness and satisfaction we get from something. In the case of my little polka-dot dress, I can’t put a price on the wonderful feel of its silky smooth fabric against my skin or how it makes me feel when I wear it.

So what’s the point?

While there is absolutely nothing wrong with using low prices as the core of a retailer’s marketing strategy, it does not work equally well for everybody. What looks good on a blonde may not be the best look for a red head; what works well for Marshalls is not necessarily the best solution for Ann Taylor. Why? Because true value is not the lowest price, but what you actually get for your money. Instead of lowering prices, justify them. Make customers feel good about paying full price because it’s worth it. Tell them why it’s worth it. Make them believe it.

True, the economy will get better one day. But the best time to differentiate your brand is now, when the majority of retailers are panicking and copying each other.  Make your footprint unique and memorable so that it will be easier for consumers to follow your path and embrace your value in the future.

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