It’s the Risk, Stupid!

In my last post I wrote about price being the issue – or rather, not being the issue.

It seems this is a subtle point that is easily and readily passed up by most.

I’ve just been watching the BBC tech show ‘Click’ (10 Sep 2011 edition). There was a review of the recent IFA tech exhibition in Berlin, Germany – the one where Samsung hastily withdrew their 7.7 inch new tablet following an injunction granted to Apple by a German court.

Lee Westaway, from CNET, stated that the price of most non iPad tablets was at least the same as the iPad, and that when faced with this choice, many buyers are going with the iPad because it’s established, it works, it’s proven, they know others who have one etc, and the new Android tablets are still a little bit “geeky” and unproven. He stated that if the price “was a lot cheaper, there’d be more reason to by one” (Android tablet, that is).

He’s wrong! And here’s why I think so – and it’s critical.

If the price were much lower, there’s be less reasons to NOT buy one – this is NOT the same as there being more reasons to buy one.

What do I mean?

Well, as I said before in my 29 Aug post, it’s really about risk. Or lack of it.

A lower-priced Android tablet means there’s less risk for me personally. If it was free, the electrical/technical/mechanical risks would be the same – it’s the same piece of equipment. And this would also be true if the price was $1 million. This is why the main risk variable is personal.

If I pay $99 for an Android or other type of tablet, it doesn’t matter too much if it sucks – I can say that for $99 you can’t go wrong with a device that’s clearly not an iPad and people shouldn’t expect an iPad experience. I can claim to be testing out the waters before deciding on whether I need a tablet at all, and if so, what capabilities I need.

This is the logical argument that hides the fact that the decision I make in buying it (or going with the iPad or none at all), like every other decision every human makes, is 100% emotional (see “Brain Rules!” by John Medina at www.brainrules.net and also “Buy-Ology” on Wikipedia…)

So the recent fire sale of the HP TouchPad device – at $329 these things weren’t moving – but HP says it’s bailing out of the retail PC/tablet business, lowers the price to $99 and these things sell out globally in a matter of hours – a ton of people around the world paid $99 for a device that’s got no future, no future support, no future accessories – nothing…

At $99 there were simply less reasons to NOT buy one – no body is going to call you a fool for buying something that was originally $500 or $600 for under $100 and that gets you ‘in’ to the tablet world… but for $300+, people imagined feeling silly buying the HP device, or the others when a little bit more gets you the ‘real deal’…

Next time you feel like you may be losing the sale and the customer is telling you it’s too expensive, remember this post – and call him or her out on it – explore the real reasons they have for not buying from you (and yes, it COULD be price alone, but ONLY if you’ve let them perceive the required solution as being a commodity – people do pay $50 for a bottle of water you know!!!)

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