💎 It’s well proven that price affects quality perceptions (but its effect is weighted on a number of factors)

Völckner and Hofmann (2007) analyzed 71 studies from 23 publications spanning from 1989 to 2006. The researchers distilled following findings:

• The impact of price on quality perception is significant but has decreased since reported in the late 1980s (Rao and Monroe 1989).
• Price-quality inference is stronger for higher-priced products.
• Price-quality inferences decrease with increasing familiarity with the product.
• Price-quality inference is stronger for fast-moving consumer goods than for services or durable goods.
• Price-quality inference is stronger in European countries than in North American countries.

Excerpt from: The Psychology of Price: How to use price to increase demand, profit and customer satisfaction by Leigh Caldwell