Managing expectations

In the late 1960s, with his acting career adrift, Bruce Lee opened a martial arts training facility in Hollywood. He started by charging $30/lesson. Hardly anyone signed up.  

That was a lot of money in those days, but a Hollywood friend suggested that his problem was that he wasn’t charging enough.

Hollywood was filled with middle-aged guys with disposable income who wanted to pay more so they could boast they were paying huge amounts of money to train with the great Bruce Lee.  And they may have wondered why the great Bruce Lee was charging so little. So, he raised his rates to around $100/hour, and soon he found himself very busy.  Then he raised it to $200 and had more business than he could handle. 

This is tied to the psychology of expectations, which is discussed in an article that was posted in the OZ Twitter feed this week.

Paying $100/hr to train with Bruce Lee suggests a better experience than paying $30/hr to train with him.  We perceive the same smell differently depending on whether we’re told it’s high-end cheese or dirty socks. The color of a food affects whether we perceive the flavor as more intense or more mild. 

That pink savory mousse tastes great if you’re told in advance to expect a smoked salmon flavor, but it’s rated horribly if you are expecting it to taste like strawberries.

This article discusses how a key part of a marketer’s job is to accurately set expectations, whether that is through pricing, placement, packaging, or communications. If the experience is not aligned with expectations, then perceptions of the product may suffer.