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The following article
was written by Coleman Patterson and
appeared in the Business section of the Abilene Reporter-News.
the gap between luxury, necessity, February 9, 2007, 7C.
hungry, need food, and decide to go to a restaurant. Where
do you go? It is time to buy a new car. Which model do you
buy? You need a new shirt to wear to work. Where do you
shop and what brand do you buy?
three of those questions, you have choices. You might
choose healthy fast food, an economical and low-cost
automobile, and a shirt on sale at a nearby discount
retailer. However, you might also choose to dine at a
high-priced restaurant, purchase a luxury automobile, and
buy a fashionable and popular-brand shirt from an upper-end
clothing store. Regardless of whether you choose the
options from the first or second set of alternatives, you
end up with a full stomach, an automobile, and something new
to wear to work. There are important similarities and
differences between the two purchase decisions.
three of the items described could be considered “necessary”
things in our culture. Food, transportation, and clothing
are needed for people to survive and to provide for
themselves. The second list of alternatives yields
something more than the alternatives in the first list. All
three items on the second list will likely cost more than
the corresponding items on the first list. Consumers who
purchase the things on the second list pay for the benefits
of the “basic” items plus something more. In some cases,
the premium might be for higher quality. In other cases,
the premiums paid for higher-priced goods and services
provide consumers with satisfaction of personal needs.
Organizations that choose to cater to luxury (that is, above
and beyond the needed) markets need to justify and reinforce
to consumers the reasons that the extra expense for their
goods and services are worth the extra money. In the minds
of consumers, the gap between necessity and luxury offerings
need to be filled with value. Organizations convince
consumers that their offerings are worth the extra price
through brand development and marketing and by offering
features that cannot be found with other offerings.
Exceptional quality, workmanship, materials, and
warranties/guarantees might fill in the luxury gap for
manufactured goods. Outstanding customer service,
personalized assistance and attention, and service after the
sale can create additional perceptions of value for retail
and service organizations. Additional benefits, features,
and offerings can also create value in the minds of
consumers as well as a host of other organizational
characteristics and features—which can function as unique
Regardless of their chosen value-adding characteristics,
organizations must inform, emphasize, and continually
reinforce the characteristics in the minds of consumers.
Advertising messages, sales techniques and promotions, and
corporate culture must all give support to the value-adding
characteristics. Customers seek opportunities to satisfy
personal needs, sometimes consciously and sometimes
unconsciously. To encourage consumers to engage in
profitable exchanges, firms must create value in the minds
on consumers. They must make every exchange seem like a
deal that cannot be passed by—if not, consumers might pass
them by for their competitors.
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