Blipfish - behind the coffee cup. The business of my business.

The rise and fall of the moving parade.

I got into a conversation with a client a few days ago about this, then again yesterday, and yet again today I stumbled across a discussion related to setting pricepoints for products. So, since my coffee is still hot and I’m trying to find ways of avoiding other work - I decided to do a drive-by post on the subject of one theory behind determining pricing.

Perceived Value.

Essentially, the gist of it is that the “value” (not price) of something is determined not by breaking down the cost to produce and bring to market and then charging a penny more for profit… it’s about creating a situation where you manipulate (for lack of a better word) the perception of what something is worth and run it up against what the market will bear.

Huh?

…Price something for as much as you can and make it seem worth every penny.

Here’s the inevitable punchline - my quick and dirty list for creating higher perceived value for a product:

1. Price it high. Price it beyond what the bean counters say you need to make a profit. It’s not about following a tired, old standard of cost + 20%. It’s about pricing it high enough that the cost alone, from the view of the customer, might appear to be special. Afterall, a dime store price suggests dime store quality. Boutique pricing suggests something a cut above the rest.

2. Have an awesomely generous return policy and awesomely worded guarantee. Not only does this fit another category (that of risk reversal - taking the purchasing risk off the shoulders of the customer and putting it on you) but it suggests that the merits of the product are so good you’re confident that nobody would want to return it - but if they did you’ll give them their money back with a smile and zero hassle. Important: Spell it out! For example “100% satisfaction guaranteed” is terrible. Yes, it is. It sounds great at first, but says nothing… what is it? How is that defined? 100% of satisfaction means how much money back? No, spell out your guarantee so it lets people know that if they decide conditions aren’t right you’ll give them back the money they spent, the mechanism they need to ask for a return (eg. calling a toll free phone number), how much and how fast you’ll return, and any benefit that takes greater risk off (return postage paid by you not the customer).

If you’ve got a great return policy it means you’ve got confidence in your product at the price it’s offered. Only scaredy-cats fear returns and have adversarial or complicated return policies with fine print. You? …nope, your prices are right and your products are worth every penny and your return policy backs that up.

3. Testimonials. They aren’t the end-all be-all they used to be because of abuse - too many schlocky companies pushing schlocky products hiring too many schnook actors to say goofy things that weren’t true. Yes, I’m a little jaded but testimonials, done right, can have a great effect on bolstering the perceived value of a product. I recommend you don’t fudge on testimonials - don’t fake it. Use real testimonials, from real people, expressing themselves in a genuine, but positive way. Even a great testimonial, if it sounds like an over-hyped schmooz-fest, might be best left unused. Sincere praise from individuals who give honest feedback in plain English are often the best ways to create higher customer confidence. Higher customer confidence feeds directly into higher perceived value when you’re representing your product. Be sure to collect and file testimonials in a proper and legal way, though - there are laws governing the use of customer feedback.

[Strange trivia #3 for the day: WordPress' spell checker highlights the word "WordPress" but doesn't ding me for the word "schlocky." Huh. Go figure.]

4. Benefits versus Features. Benefits are “you’ll be happy and look great.” Features are “Pentium 3.2 processor, 250 gigabyte hard drive, 4 gigs of RAM, 21″ LCD monitor.” List both. Have ad copy, product description, testimonials, or any other content you can muster that lists benefits and features for your customer. If you can convince them that it comes with bells and whistles, but also what wonderful things it’ll do for them personally… you’ll appeal to their senses of need and desire - again, creating a higher perceived value.

5. Bonuses. If you are in a position to give added value - a bonus - do so. You can offer such bonuses upfront (which has an elevating effect during the purchasing process) or you can combat buyer-remorse by giving a bonus that comes as a pleasant surprise after they purchase or receive their product. A phone that’s disguised as a sneaker is one way to give a bonus but so is a coupon for future purchases. It depends on your abilities and avenues available but try something that adds to the sale or reduces buyer-remorse (second thoughts after getting the product). Lock in that sale with a little something extra.

6. Endorsements. If Brad Pitt or Angelina Jolie aren’t available to tell people how great your product is - consider riding the testimonial train again, except this time by putting a face to the testimonial. The more you can get a famous person or respected individual in a related field to tout your product - go for it. If you can get the lady down the street to do the same and she looks like she has a trustworthy face - see what you can do. Special note: celebrity endorsements, in particular, carry a heavy risk. If they ever do something negative or fall from grace the last thing in the world you might want is to be associated with them. We’ve watched major sodas or fast-food chains drop celebrities like a bad habit when something negative comes out in the press regarding them… fact or fiction. so, beware of who you use to endorse your products and again… make it legal.

7. Brand it! Give that sucker a name, a title, a reason-to-be, and do what you can to make that mousetrap, sport car, tshirt, toilet brush, or whatever “the” item in its class. Branding is a process and involves a lot more than what I’m typing here (I’ll write more on that later - when I’m dodging other work and have more coffee) but if you are working your way toward creating an identifiable brand you can often command higher prices for that alone. You really don’t think those baby GAP jeans are honestly made of some special material worth that much money, do you? No, it’s the name.

In the end, there are several ways, but these are my favorite highlights for creating an environment in which your product can not only stand above the rest but also withstand higher pricing by creating a greater perceived value. Let people see that the dollar amount you’re setting (not asking for - but setting) has a lot more behind it than just the sum of that product’s parts. It’s got value that you walk people through (consciously and maybe even a bit subconsciously) that makes it clear it’s worth the money and maybe more.

What are we up to now? Millions upon millions of toys recalled due to being made in China and suffering from low-quality/no-quality standards? Just one toy (eg. Thomas & Friends Wooden Railway Friends train set) can amount to a million and a half units recalled - that’s just one toy line.

Our family protested by not buying many of the things we would have bought our children for Christmas and birthdays - but the list keeps growing it’s hard to know what is next and since estimates are that 80% of children’s toys are made in China… it’s hard to find alternatives - not that it’s not worth trying to.

Here’s another one of my twisted ways of protesting the situation:

Nostromo n52

Originally uploaded by blipfish.

The Nostromo n52
(There’s a newer version out now)

www.Belkin.com

It’s generally marketed as a controller for PC games. Competitive players like the fact it has multi-function keys and controls but also the fact the software allows for macros (performing difficult moves that require many precise, coordinated key presses) with only a single button push.

For me, it’s all well and good - Battlefield 2, Call of Duty, and all that.

However, this little gizmo really shines when used in Photoshop.

I already have repetitive stress and that’s not unusual for a graphic artist, especially one that works on the computer. I use a multi-button mouse, keyboard, one of two graphic tablets, and believe me the stress and strains on one’s hands, wrists, and forearms can be a lot after a long workday.

The Nostromo n52 controller allows me to work in Photoshop CS2 and complete many of the macro commands I use regularly with perhaps half (or less) the button presses.

I’ve managed to reduce my hand/wrist stress a LOT by using this. I often place it on my left leg (as I use it with my left hand) and it’s very comfortable. It allows me to perform multi-key tasks with only a button push or two and that is definitely worthwhile.

So, if you’re getting tired of having sore hands and hitting CTRL-SHIFT-Z or whatever in your software applications - try hooking up with one of these and get used to just pushing a single key.

I got it!

Originally uploaded by blipfish.

I got it!

I got my first, officially licensed Major League Baseball Chicago Cubs Practice Jersey (by Nike). Yes… ooh, ah. Behold. Behold.

Hey, you gotta be a Cubs fan when in Iowa because we have the Minor League Cubs (to the Chicago Cubs) here. I think it’s a State law?

WIP

Originally uploaded by blipfish.

(Work in Progress)

Just reflecting back a year ago.

2006-2007 Holiday Season:

I’m working with some extremely talented web designers over at Peon Productions to get a new online storefront built. There are a lot of loose-ends to tidy up, but essentially we’re into the “sea trials” where we bang on the site and see what holds together and what needs work.

It’s all part of my “day job” - I run several online apparel companies of different kinds with different suppliers. This particular one has been a theme I’ve been looking forward to carrying forward but haven’t had the time. It takes a lot for a graphic designer to hire a team of web designers… shows how busy I am. However, I’m thinking the results are going to be wonderful. I can’t wait for the roll out.

Very happy to say it rolled out nicely and looks great to this day.

Thanks Audrie!

I suppose webcams take photos, yes?

Originally uploaded by blipfish.

Running the blipfish corporate empire requires work, work, and coffee.

Well, it requires a few other things but few are more important than the above three things (or would that be two?).

Working for one’s self from a home office has many challenges, perks, and oddities. This picture (well, webcam shot) shows one of the oddities - my graphic desk in all its cluttered, cabled, and blinking light glory… or as much as this shot shows those things.

Three mice? Well, the G7 is partially for gaming and times when I need the high-resolution precision but the greatest benefit is to relief of my repetitive stress syndrome! It has saved me from pain so much. The black/grey model came with the wireless keyboard. It doesn’t “fit” my hand well and hurts to use too much. The grey one is wirelss that goes with my smaller Wacom tablet (the cord underneath goes to the tablet). I actually have a 12×18 tablet and the mouse for that is much more comfortable than this one.

Silver disc… 4 port USB hub / Coffee warmer! ha ha! Seriously! A gift from my “boss” at Cafepress.com - lovely folks.

Baseball - Rawlings Official League RPBX 9 inch, 5 oz. practice ball. Sand-fllled hackey-sack underneath it.

Glove hand - Old habit with a purpose. “Back in the day” when I’d draw with pencil/ink a glove was useful for not smudging the paper. Now, even though using Wacom tablets have no such issue it helps keep my hand movement across the plastic surface smooth and quick. Enough hours of using the tablet and your hand gets a bit warm… sorta’ squeaking across the surface. The glove helps avoid that.

The KCCI tower cam - I’m not positive, I think that’s the new Wells Fargo Arena? Someone can hopefully correct me. Check out their very cool webcams at KCCI.com - let them know how much you enjoy what they offer. I love their tower cams.

Aquarium Cam - Serene Screen’s ever-so-wonderful saltwater virtual aquarium. I’m partial to the lionfish, personally.

I’ll bet I’m not the only SOHO that has a desk that looks like something out of a mad scientist’s lab?

Tornado Republic

Originally uploaded by blipfish.

Just testing the quality of the new, vinyl signs. This isn’t for sale - just needed something to get in my hands and gauge the print quality and color fastness. It’s a quickie conversion of a tshirt design from one of the stores.

Quite nice - it’s a heavy vinyl, very solid printing, good saturation, crisp lines, and overall a good product.

Blipfish is pleased.

Original image on actual, for sale product:

Believe it or not but there’s a lot that goes into writing this column. There’s less to do when publishing it to this blipfish blog, but there’s stuff going on behind the scenes, let me tell you.

Not everyone is up to the challenge.

I have to open up deep, dark, secret parts of my psyche and drop them down in front of you. Did you hear that thud? That was one right there. Damn, that sounded deep and dark, didn’t it?

Fortunately I have coping mechanisms that help get me through each day. You have to when you work for yourself.

My day begins with my first cup of coffee. My wife says it’s more like a science experiment. I think she’s referring to the fact that I have a precise formula I follow to make it “just right” each time. Fresh ground coffee (whole bean, extra bold), two spoons of sugar, splash of creamer (the good kind, of course), one and a half spoons of chocolate syrup (again, the good kind), and then I fill up the stainless steel travel mug within one and a half inches from the top. This leaves just enough room for a little milk to top it off. (I think I’m starting to see her point).

It’s important to start the day right when you have the responsibility of creating this brilliant column, selling tshirts, creating masterpieces of art, consulting for businesses, marketing affiliates, and playing Tiger Woods golf with Mike or Ajay. As a matter of fact I insist on only using that stainless steel mug for my coffee. The first reason is that it holds more than a normal coffee cup. The second reason… it looks like some high-tech container that alien embryos might be stored cryogenically inside of. (Now you’re starting to see why I need coffee). But, this is all due to the fact that I have have such vast responsibilities and frankly, because you people stress me out. It reminds me of when I was milk-monitor in grade school. My powers were absolute. There was a lot on my shoulders then, too.

With coffee number one in hand I head to the office. My think box. The Crow’s Nest. I log on to the computer and check mail.

I must be getting old. I remember when “checking the mail” had only one meaning… going to the front door, opening it, sticking your hand inside the metal box and pulling out paper envelopes and letters from Ed McMahon. Now, it means something different to many people. It’s a shame too because sometimes you get lucky and get a really attractive mail-carrier-lady-person like mine who has nice legs. (“mine” - like I hold the pink-slip on her).

Anyway, I digress…

I check the “mail” in roughly this order: email from friends first, mail from friends second, email lists or groups I subscribe to third, physical magazines I subscribe to fourth, and then any mail marked “urgent” gets looked at last.

I like getting mail. I like email especially. The Internet allows me a great way to reclusively socialize from the comfort of my office chair, drinking my coffee, sitting in my underwe…

I’ve said too much.

I also like writing these columns for you every month. I like saying that I write them every month when they don’t really get done that consistently. It’s a great way to communicate without having to get dressed up (or dressed) or having to set my cryogenic container down (coffee mug).

It makes me feel important. It even makes me seem… mysterious.

“So, what do you do Dan?”

“I… write… I do other things too.”

“Wow, that’s very important, even a little mysterious.”

See? I like that.

On to the other things…

I have a friend, we’ll call him “Hector” (that’s not his real name). Hector likes to give me ideas about what to write, products to add to the stores, pictures and paintings to create. Now, it’s easy to come up with the greatest poster design since Andy’s Campbell Soup Cans (at least “think in your own mind that you’ve come up with a great design”). It’s an entirely different matter to be the one who has to create such things.

You see, when Hector (not his real name, remember?) says things like: “Hey! You could do this really great ball of fire that jumps off the page, and has this 3-D effect that when people look at it they can’t believe it’s not real!” I tend to turn a deaf ear to him because you just know that that can’t possibly work in spite of how grand it sounds. I mean, it’s weirder than those paintings of Jesus or Elvis where the eyes seem to follow you around.

But, I humor him and smile. He probably thinks he’s the driving force behind my artistic visions. I also think he likes to tell people that he would be my “phone a friend” guy if I ever made it on that television game show that used to be hosted by Regis.

He isn’t and he wouldn’t.

(I wonder what the liability issues would be for a poster that actually burned the tops of people’s heads as they walked by?) Hmmmm…

(Have you noticed that I write parenthetically a lot?)

I admit it. I do (write parenthetically way too much). It’s like typing what I think. I like writing this way. I like having a friend whose name I won’t tell you. In fact, there’s no reason on Sting’s green Earth for me not to tell you. Yet, it all makes me seem like I have stuff going on that’s just too important or mysterious to tell you about. Like those guys that write to Penthouse Magazine, or so I hear. Yah, they have mysterious and action-packed lives, let me tell you! I mean, that’s what I hear.

Having a friend that is named “Hector” is no big deal. There’s lots of Hectors out there and they must be friends of somebody, right? But, telling you upfront that it’s not his real name makes me seem like I have “people” that you shouldn’t know about. Hey, I can have people. I can… like Hector (as you recall—that’s not his real name).

Nope, I wouldn’t tell you his name. Not even if you begged me or large sums of money were involved. You could even bribe me with a visit from Gillian Anderson wearing nothing but a bikini and tinfoil hat and I still wouldn’t tell you. It would ruin the image you have of me - coffee, parentheses, mystery and all.

I like my coffee. I like writing parenthetically. I like them almost as much as referring to Ajay as “Hector.”