What Happens When Something Is Just Too Cheap?

by Glenn Fisher

You’re reading a promotion for a product or service...

The idea sounds good and you’re thinking it’s something you’d like to try out.

You start to skim through to find out how much it is and you get to the section of the promotion that refers to the price.

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If it’s a good promotion, prior to mentioning the price, whoever wrote it should mention the potential value of the product or service to you.

That way you can make a comparative assessment of the cost...

You can figure out if you’re willing to spend X to make Y.

Naturally, you’d expect the potential value to be higher than the cost - otherwise, what would be the point.

But here’s where I’ve noticed a lot of people mess up...

Including some ‘so called’ experts!

You see, as much as the potential value needs to be higher than the cost, if it is higher by too big a margin then that could actually have a negative effect.

When I was a kid, each week I’d go down to the Sunday market in Cleethorpes to buy a new computer game.

(This was the days when a computer game was on a cassette and the cost closer to four quid rather than forty, so pocket money would cover it.)

On the market was one particular stall that was set up almost like a show.

There was this big burly guy on stage and behind him he had a vast range of products.

With his booming voice he’d shout out a deal. He’d start off with something relatively small at a relatively decent price and from there he’d start adding bonuses...

Finally, after bundling together an enormous selection of goods he’d start chopping the price.

But the reason I remember him is because I remember how ridiculous the prices became...

There he is offering a huge selection of products worth, in theory, say £1,000, but he’s charging £2 for the lot.

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What? Sure the potential value is greater than the cost, but it is by such a degree that you have to start questioning if the potential value is accurate.

I mean, how could he really afford to sell £1,000 worth of stuff for just £2?

It just doesn’t sit right.
For a start, we’re not used to such discounts. We’re naturally suspicious - and should be. So, as soon as we see an unusually large discount like this, we’re put off by it.

If the guy was offering the stuff for £500 you’d probably be more open to the idea, right? It’s more reasonable that someone would offer you a 50% discount. You see 50% discounts all the time.

But a potential value of £1,000 and a cost of £2...? Something’s wrong.

Sadly, this mistake isn’t isolated to the burly man down at Cleethorpes Sunday Market - increasingly I see it in a vast range of promotions...

In the same paragraph I’ve seen people suggest products to their readers that could make £100,000 but the cost is just £40...

I’ve even seen someone suggest you could potentially make millions for a pound.

Come off it.

When I read this, I just know that the promise is not going to be delivered - no way near. And like I used to think about the burly Sunday market guy’s products, I think the same of the modern marketer who does this... something’s wrong.

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So, if you’re selling a product or service yourself and you’re offering a discount - bear this in mind.

Discounts are an effective marketing tool, but if you go too far and the relationship between the value and the cost is too far removed, rethink your discount.

On the other side of the coin - if you’re reading a promotion for a product or service - be sure to tread carefully where the cost is just too small compared to the value.

Hey, in some cases you really might have struck on a shocking bargain. But nine times out of ten, it’s likely you’ll end up disappointed.