Hi everyone!
In this lesson, we’re going to explore how customers’ perception of value can influence how a product is priced — especially when we talk about luxury or premium products.

Let’s start with a simple idea:
People don’t just buy a product — they buy what they believe the product is worth.
This is what we call Perceived Value.

It’s not always about how much the product actually costs to make, but how much the customer feels it is worth to them.

For example:

• A Rolex watch and a Casio watch both tell time, but people are willing to pay thousands for Rolex because of its brand image, craftsmanship, and social status.

• Similarly, a Starbucks coffee might cost RM15, while a regular kopitiam coffee is only RM3 — but customers pay more for Starbucks because they perceive higher value in the experience, brand, and quality presentation.

That’s the power of Perceived Value Pricing.
Businesses use this approach to set prices based on how customers perceive their product’s value, not just on cost.

Now, let’s look at Luxury Pricing.
This strategy is used when a company wants to position their product as exclusive, high-quality, and prestigious.
In luxury pricing, the high price itself becomes part of the brand’s image — it sends a message that the product is rare, premium, and desirable.

Examples of Luxury Pricing in Malaysia:

• Mercedes-Benz Malaysia uses luxury pricing — their cars are priced higher to reflect superior design and prestige.

• Swarovski or Habib Jewels use high prices to signal luxury and exclusivity.

• Even local brands like dUCk by Vivy Yusof use luxury pricing to position their scarves as lifestyle fashion items, not just plain hijabs.

So remember —
✅ Perceived Value Pricing focuses on what customers believe your product is worth.
✅ Luxury Pricing focuses on exclusivity and prestige — where high price adds to brand desirability.

In both cases, marketing and branding play a huge role in shaping how people see value.
If your brand story, quality, and experience are strong, customers will happily pay more because they believe your product is worth it.