First thing first:
Actual Value =/= Perceived Value
Anyone disagree? Are Jordan 11s worth $240? Objectively, functionally, relative to their utility or quality of construction or aesthetic appeal or durability in regards to other shoes that cost much less, no. But, on the other hand, they are worth $240 because, if you want a pair, that's what you'll pay for them--and when a new color/trim comes out people will stand in line or pay even more on third party retailers.
You might be asking, @fastlife I thought we were talking about Game--what do shoes have to do with that?
Well, if people pay $240 for a pair of shoes, does it not open up the possibility that they might not be totally rational agents?
Looks, Money, Status are all quantifiable--or at least physically observable. They are objective; standards can be set and people can be judged and place in a rational hierarchy accordingly. But they are also context-dependent--their relative value is constantly in flux. The most physically attractive man in 500 sq miles of backwoods Missouri would be below average in a room full of Calvin Klein models. A high level computer programmer is high status at his job--he has the title to prove it. This status might even carry over into his dating life, if he's dating women who are seeking a provider at that particular moment. But put him in the hottest club in a college town and see how much people care about his job title.
But wait, money is money...right? Right? On a desert island, all the money in the world won't do you any good when all anyone wants is a mothafvckin coconut.
Frame matters.
The perception of any given value depends on frame. What is frame? The parameters of any given interaction; your way of seeing the world vs. other people's way of seeing the world. But, wait, wait, shouldn't objective reality be the strongest frame? People might be tricked temporarily but shouldn't they eventually make rational decisions based on actual value?
And I'm here to remind you about the $240 pair of Jordans. Nike's frame, as long as they can keep selling them for $240 is THE dominant frame. No amount of reason will convince anyone who bought a pair that they didn't just make a good purchase. Emotionally, they feel like that pair of Js was worth $240.
Nike understands Game. Nike understands that by appealing to people's emotions, by presenting value effectively, by controlling supply to create the illusion of scarcity, they can overpower the objective value of a pair of tennis shoes.
Let's pretend we're opening a car lot.
The LMS equivalent would be to make sure you stock the best car brands, and you polish them and keep them impeccably clean, but you can't advertise cause that'd be fake and try hard and none of that salesmanship trickery cause that'd be fake and people should see the value of these cars. And maybe if you have the perfect location, people will stumble in and buy a car from time to time--if they came to the lot specifically to buy a car. So whose frame is dominant? Yours, or the consumers?
But, let's say a competitor opens a lot across the street. They have one of those big azz wobbly inflatable men and a big azz red sign and, when you come in, they have a sleek lobby and give you a selection of semi-gourmet coffee, and the salesman seems like a nice young man and he graduated from the same high school as your daughter, and, well, you're only here to look, but you sure would look nice in that new SUV and it has room in the back for when you have to drop your daughter off for college and they're about to sell out of this particular model and aren't sure when they're going to get another shipment.
Who's going to sell more cars? And will their ability to sell more cars be based on the objective quality of the selection...or the fact that humans make emotional decisions and rationalize value afterwards
The richest, highest status men in the country figured out the answer to this question a longtime ago. So, yeah, go ahead and argue that actual value matters more than the effective presentation of that value.
Actual Value =/= Perceived Value
Anyone disagree? Are Jordan 11s worth $240? Objectively, functionally, relative to their utility or quality of construction or aesthetic appeal or durability in regards to other shoes that cost much less, no. But, on the other hand, they are worth $240 because, if you want a pair, that's what you'll pay for them--and when a new color/trim comes out people will stand in line or pay even more on third party retailers.
You might be asking, @fastlife I thought we were talking about Game--what do shoes have to do with that?
Well, if people pay $240 for a pair of shoes, does it not open up the possibility that they might not be totally rational agents?
Looks, Money, Status are all quantifiable--or at least physically observable. They are objective; standards can be set and people can be judged and place in a rational hierarchy accordingly. But they are also context-dependent--their relative value is constantly in flux. The most physically attractive man in 500 sq miles of backwoods Missouri would be below average in a room full of Calvin Klein models. A high level computer programmer is high status at his job--he has the title to prove it. This status might even carry over into his dating life, if he's dating women who are seeking a provider at that particular moment. But put him in the hottest club in a college town and see how much people care about his job title.
But wait, money is money...right? Right? On a desert island, all the money in the world won't do you any good when all anyone wants is a mothafvckin coconut.
Frame matters.
The perception of any given value depends on frame. What is frame? The parameters of any given interaction; your way of seeing the world vs. other people's way of seeing the world. But, wait, wait, shouldn't objective reality be the strongest frame? People might be tricked temporarily but shouldn't they eventually make rational decisions based on actual value?
And I'm here to remind you about the $240 pair of Jordans. Nike's frame, as long as they can keep selling them for $240 is THE dominant frame. No amount of reason will convince anyone who bought a pair that they didn't just make a good purchase. Emotionally, they feel like that pair of Js was worth $240.
Nike understands Game. Nike understands that by appealing to people's emotions, by presenting value effectively, by controlling supply to create the illusion of scarcity, they can overpower the objective value of a pair of tennis shoes.
Let's pretend we're opening a car lot.
The LMS equivalent would be to make sure you stock the best car brands, and you polish them and keep them impeccably clean, but you can't advertise cause that'd be fake and try hard and none of that salesmanship trickery cause that'd be fake and people should see the value of these cars. And maybe if you have the perfect location, people will stumble in and buy a car from time to time--if they came to the lot specifically to buy a car. So whose frame is dominant? Yours, or the consumers?
But, let's say a competitor opens a lot across the street. They have one of those big azz wobbly inflatable men and a big azz red sign and, when you come in, they have a sleek lobby and give you a selection of semi-gourmet coffee, and the salesman seems like a nice young man and he graduated from the same high school as your daughter, and, well, you're only here to look, but you sure would look nice in that new SUV and it has room in the back for when you have to drop your daughter off for college and they're about to sell out of this particular model and aren't sure when they're going to get another shipment.
Who's going to sell more cars? And will their ability to sell more cars be based on the objective quality of the selection...or the fact that humans make emotional decisions and rationalize value afterwards