One of my favorite insights about how we think as consumers comes from John Lawhon. In his book “Selling Retail,” he opens up the difference between the price and cost of something.
At first you might think he’s making too much of a small thing. But if you stick with him, you discover something really important about how we make buying decisions.
Let’s say you buy a coat priced at $300. It serves you for two years, and then it’s done. Your cost is $150 per year. Let’s say your other option is a coat priced at $1200. It lasts 10 years, costing you $120 per year. When you look at the cost over time, the luxury coat actually cost less. Plus, the luxury coat comes with much higher quality fabric, tailoring, style, and you enjoy wearing it a lot more than the other one.
This line of thinking can help us make important buying decisions. But in my work with architects, designers, and their clients, I see many people getting bogged down because they’re just not used to looking at cost and price this way.
I see many people on the fence about how to proceed with purchasing decisions in their design projects.
Once they do proceed, I often see them choosing the less expensive products or services instead of the better quality options available to them, even when these superior products and services are ones they can afford.
This same price versus cost rule applies here.
But when applied to home furnishings and home improvements, we have the added factor of the impact on resale value and longevity. For example, a furniture piece of exquisite workmanship and beauty can be restored with updated fabric or finishes. You don’t need to replace a high quality item, as you would a lower quality piece that simply wears out or lacks timeless design quality.
This isn’t to say you should always buy the most expensive item. But when you’re able to look at your purchases as investments in quality over time, you’re more often able to enjoy live for years in a setting that fills you with satisfaction and joy, and at a lower cost and preserving the value of your investment whether you keep them or sell them later.
This also appeared in iMatchDesigners as Price Versus Cost