A Startup’s Guide to Making Products More Valuable and Attractive to Customers | by Richard Yang (@richard.ux) | The Startup | Medium

All businesses want people to see their products and services as valuable and desirable. As designers and marketers, we can leverage two social psychology principles, the “Veblen Effect” and the “Scarcity Effect” to accomplish this. The “law of demand” states the price of a product and its demand are inversely related. In other words, the higher the demand for a good, the higher its price. Given the two equivalent products, a lower price will increase demand, and a higher price will decrease demand. This principle of supply & demand is how economics and pricing worked for most of history. However, at some point, an economist discovered the exception to this rule. He named this exception “The Veblen Effect,” which was defined as “the tendency to find a product desirable because it has a high price.” This effect is mostly associated with luxury products and services like art, clothes, cars, fine wines, hotels, etc. However, principles of the “Veblen Effect” can still be leveraged for pro

All businesses want people to see their products and services as valuable and desirable. As designers and marketers, we can leverage two social psychology principles, the “Veblen Effect” and the “Scarcity Effect” to accomplish this. The “law of demand” states the price of a product and its demand are inversely related. In other words, the higher the demand for a good, the higher its price. Given the two equivalent products, a lower price will increase demand, and a higher price will decrease demand. This principle of supply & demand is how economics and pricing worked for most of history. Howe