04/04/2025
People don’t really pay for value; they pay for perceived value. Let me explain.
Take a look at this image...
The price of a whole watermelon and a glass of watermelon juice is the same. And if you aren’t savvy, you might assume both products share the same value. But that’s not actually the case. That’s the power of perceived value.
A glass of watermelon juice and a ball of watermelon, both sold at the same price, $4, don’t have the same value ideally. But when you leverage the power of perceived value, both are placed on the same pedestal in the customer’s mind.
Now, let me break it down for you.
When you (the customer) see a whole watermelon, what you really see is the product that contains what you want, the juice.
But in the back of your mind, you’re also seeing the pain, the stress: carrying that heavy ball home, washing it, slicing it, deseeding it, blending it, straining it, and then finally drinking it.
The time, energy, and stress of going through all that just to get the juice? It feels like too much effort. And that hidden ‘pain’ influences your buying decision.
Now, let’s flip it.
What happens when you see a glass of fresh watermelon juice?
When you come across a bottle or glass of watermelon juice, you don’t just see juice, you see convenience.
You see that someone else has taken away all that stress, time, and energy needed to get the content you need. All you have to do is pay and enjoy.
That’s why people will gladly pay $4 for a glass of watermelon juice rather than buy a whole watermelon for the same price.
And this is exactly how entrepreneurs think.
Entrepreneurs focus on reducing pain points in the customer’s journey to experiencing their product.
On the other hand, a regular businessperson is mostly about buying and selling, just moving products.
They don’t always consider the hidden struggles that influence a customer’s decision.
And that right there is what separates entrepreneurs from businesspeople.
An entrepreneur is always thinking about those hidden struggles customers go through and how to offer solutions.
They look beyond the product and focus on removing the friction that could stop someone from buying.
In this watermelon example, an entrepreneur understands that what the customer truly wants is the juice, not the mess of getting it.
So instead of just selling the watermelon, they create a system that eliminates the hassle, making it easier for customers to access exactly what they need.
And the best part?
While a traditional businessperson sells one watermelon for $4, an entrepreneur extracts more value, turning that same watermelon into multiple glasses of juice, easily making 4-5x that amount.
That’s the power of perceived value.
