Thursday, 24 November 2011

Why the Amazon Fire is possibly the best thing that could have ever happened to the Nook Tablet.

Amazon entering the tablet market has generated a ton of press, and rightly so - it's an inexpensive and simple way for "non geeks" to do all of the things. As a result, the 99% of normal people who can't justify a "premium tablet" are taking an interest in the Fire.

But, have you noticed that almost every article about the Fire mentions the Nook Tablet?

Most articles explain that the Fire is special because it has a special "end-to-end ecosystem" (like the other magical tablet), but then go on to say that, btw, there's another tablet that has a better screen, faster processor, more memory, sd slot, volume buttons, microphone, etc which (and this is key) is just slightly more expensive.




Price relative to similar items has a significant effect on the perception of an item. This doesn't make sense because there's lots of expensive crap, but it's still true. People don't buy the cheapest toaster, microwave, iron, washing machine, etc because they expect it will be cheap crap.

If they have dough they buy an expensive one - the Dyson or Apple. Every one else buys the second or third cheapest. The point is, that perception is relative to reference points. The Amazon Fire gives the Nook the perfect reference point, especially as the Nook is actually the better product.


Superficially the devices are very similar. Both are 7" color tablets which can do video, books, music etc But the difference in perception that $50 makes is huge. People are more likely to use something that cost a little more and to congratulate themselves that they made the best choice. Apple fans have been doing this for years, but now, with new reference points, Nook Tablet owners can enjoy the smug feeling of being superior to their Fire owning friends. Thanks Amazon!

http://www.productiveflourishing.com/the-3ps-of-pricing-perception-part-1/
http://www.slideshare.net/jdinsmore/price-perception-the-placebo-effect-in-marketing

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