The financial value of the framing effect of brands

Brand & Marketing

This framing effect of brands is not marketing hype; it increases the perceived value and the willingness to pay a premium price - even for objectively identical products. The VW Sharan and the Ford Galaxy are identical cars - both produced in the same factories - but consumers have been willing to spend a premium of EUR2,000 for the frame that the VW brand added. In the UK, Virgin Mobile has higher perceived network quality and satisfaction scores than T-Mobile despite the fact that it uses the exact same network.

Behavioural principles

Behavioural ideas at play in this post

Short, plain-English explanations of the principles behind this post, with links to related books and examples in the archive.

Framing effect

Equivalent facts can lead to different choices depending on how they are framed.

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Curse of knowledge

Once we know something, it becomes hard to imagine what it feels like not to know it.

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Price-quality heuristic

When quality is hard to judge, price becomes a shortcut.

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The financial value of the framing effect of brands

Behavioural ideas at play in this post

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