Cheap vs. Economical

Cheap and economical are two words with very distinct meanings which are sometimes used (incorrectly) interchangeably. The meaning of the two words are evidently more different when it comes to selling a product. Take automobiles for example. Not many people will want to drive the cheapest car in the world but many of them will opt for a car which is the most economical in its class.

When you say that the product you are trying to sell is cheap, it loses its value. An economical product on the other hand is something that is the best value in its category. The key thing to define here is value. Value is a very intangible thing. Some products are sold at a premium because the perceived value of the products is higher than normal. Others are discounted to map to their perceived value. Any product that best justifies its value to the consumers in a category is theoretically economical.

Something that is sold cheaper than its perceived value eventually starts getting perceived as a product of lower value.  Develop a great product, create campaigns and build service infrastructure to in-turn increase the value of your product for your consumers. At the end of the day, price is always mapped to the value of the product. So the right strategy is to make your product economically appealing. Don’t sell it cheap.

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