The Greek philosopher Aristotle divided the means of persuasion, appeals, into three categories–Ethos, Pathos, Logos. Today, we’ll talk about ethos.
When you’re trying to persuade a customer that your product is worth more than another person’s product, you will invoke one of the three. Substantial investment will be made mostly on the logos and ethos front. In modern day-terms, logos will be data, reports, forecasts and etc, whereas ethos will simply be reputation.
I believe perception and reputation is a good form of investment, because if you want to convince your customers that your product is worth more, you’ll have to employ one of those 3 methods. You can logically convince a customer, and they’ll provide you with logical prices.
The key is to focus on the illogical. Beauty is in the eye of the beholder, and your evaluation will be based on what they perceive. Sometimes, it can be lower, sometimes it can be accurate, and sometimes it can be higher. The fact that it can be higher gives you a great opportunity to capitalize on the differential.
You can sell logic, or you can sell reputation, and even empathy. If you had to choose one, I’d think reputation would have the most potential for irrational profits.