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[harrisk954]

This is an issue that has been bothering me for quite some time. For some reason, no matter what the demand for a product or the cutting edge nature of the technology involved, certain products get pegged as being “overpriced”, “only for enthusiasts” and “dead on arrival”.
Yet, other products do not suffer such slings and arrows. Rarely are these early indications accurate and the same people who slam these new products are often the same early adopters who actually buy them on day-one.

So, recently, we have as case and point, Virtual Reality:

• Oculus Rift: $599.00
• Vive: $799.00
• PSVR: $399.00

There have been countless articles written on all three of these cutting edge products and how they are not going to have mass adoption because they are priced “too high”. Even on NeoGaf, where everyone is a video game “enthusiast”, there have been many naysayers making negative posts. Yet, all three products sold out within minutes of their respective pre-order web pages going live. There is also a tremendous amount of excitement over this new form of entertainment that has found its way into the general consumer’s consciousness, with articles appearing in Time Magazine, The New York Times and the Wall Street Journal, to name a few.

But, not every product gets the scrutiny that some others do. For example, no such complaints are made of the iPhone (or other smart phones) when those prices were/are revealed. The original iPhone was $499 for the 4GB and $599 for the 8GB model on-contract. The current model, the iPhone 6 is $650 with no contract (in the U.S.) The Samsung Galaxy 7 is $795 (paid out over 30 months)

Well, those are phones, you might argue! Of course, they are expensive and worth it for what you get! There is a perceived value there for millions and millions of consumers.
What about Tablets? The original iPad was $599.00. The latest iPad? Same price, unless you want 4G, in which case, the 32 GB model is $729.00 and the 256 GB is $1,029.00!
Yet, people still buy them by the millions. Yes, you can use them for all sorts of great things, but you are paying way more than you should because there is a perceived value for an Apple product by many consumers. An Apple laptop is going to be much more money than its PC counterpart for the same reason.
People who purchase Apple products don’t balk at the thought of those prices. Some will tell you it is not worth it, but many people (from tech geeks to mainstream consumers) will pay a premium because they perceive a value there.
Let’s talk about some more innocuous products… $900 for the newest Roomba – an automatic vacuum cleaner that does a mediocre job of what it was designed to do. How’s that for value? Yet, they sell millions. How about the Vitamix? A $600 blender! Great product? Sure, I think it is, but it is all perceived value. A Logitech Remote Control? How about the Logitech Harmony Remote Control for $350.00? Not the most expensive remote, either!

Gaming you ask? The newest Xbox Elite controller is a whopping $150! Wow, talk about perceived value! Those who buy it, or other high end game controllers, love it and will sing its praises. How about the newest and greatest fighting stick for Street Fighter V? The MadCatz site is sold out of them and they sell for $229.00 retail! $229.00 for a controller you use for one game, for all intents and purposes! Yet, those who want it buy it. Racing wheels to play Gran Turismo or Forza or Project Cars? How about the Logitech G29 Driving Force? $799.00! Or, if you want a deal, how about the Thrustmaster T500RS at 599.00? How about the original PS3 at $599? It sold out at launch and could not be found in stores for months after release, even though it was regularly bashed in the media – it had a high perceived value to a lot of people, but for many the value was not there when compared to the XB360. Flash forward to the PS4 vs. XB1. The perception was (and continues to be) that the XB1 is too expensive compared to the PS4. But, in reality, value is all what a person sees in a product. People are up in arms that No Man’s Sky is being released for a full $60! Yet, people will spend double that on a special edition of some other game that might not approach the quality and gameplay of No Man’s Sky. We don’t know yet since NMS has not yet been released, but it is already being attacked for the audacity to charge $60 for it! How about that new Mass Effect Geth Pulse Rifle replica for almost $1,000? Worth every penny, right?
People buy any or all of these products because they see the value in having them and, yet, most products do not get hit with hundreds of articles knocking them out before they ever get off the ground. Yes, electronics and consumer devices can niche, but there is a huge market for them. Likewise with the new VR systems. Are they expensive? Not really. Not for what they offer. These systems certainly offer a potential that is much more far reaching with a much greater scope than most new consumer entertainment products. VR systems play games, allow for new forms of communication, travel, business applications, science, etc. The promise of VR should create the value proposition that will usher in mass market acceptance. VR does not appear to be a “flash in the pan” gimmick – it is here to stay and will become ubiquitous.

But, back to the original premise: PERCEIVED VALUE. Why do some products come out of the gate with a greater perceived value than others? VR is being regularly beat up even though the PERCEIVED VALUE by millions of people is high. If you think about it, there should be more of a perceived value in VR than in single function devices like a remote control or a racing wheel, but for some reason certain passions erupt when certain devices are announced. Hell, people have posted right here on NeoGaf that they want to see VR fail because it is too expensive. The attitude is: “Let’s teach Sony, Valve/HTC and Oculus/Facebook a lesson! I see no value in these products, so neither should anyone else. Of course, I just pre-ordered that new Thrustmaster Hotas Warthog Joystick for $499 and can’t wait for it to arrive!”

Personally, my PERCEPTION is that VR offers far more intrinsic value than many other types of products out there. $399 for PSVR -- a product that will offer potentially life altering experiences? Count me in as one who sees the value there!

What do you all think about this? Is VR getting a bad rap on price while other “lesser” products get a pass? Based upon all reports of those who have experience it first hand, all it takes is to try it and the perceived value becomes readily apparent. What products have you found yourself buying based upon your own perceived value of it? What products do you turn your nose up at when you hear people are spending their hard-earned money on what you look at as being overpriced?

 

[Ryaaan14]

I mean, is it really "perceived value" if they cost almost that much to manufacture?

 

[FriedConsole]

Perceived value is subjective and different for everyone. If I say "VR is overpriced" that is me saying "I don't think this worth it for me at that price". Some people don't have $400 to throw around and that is working for a week's pay. Some people don't see themselves using it more than a few times a week.

Are you one of those people that need "in my opinion" prefaced in front of everything other people say and respond with "well that is your opinion".

 

[Glass Shark]

For example, no such complaints are made of the iPhone (or other smart phones) when those prices were/are revealed. The original iPhone was $499 for the 4GB and $599 for the 8GB model on-contract.

False. There were tons of people laughing at the iPhone's price saying it would never sell, including Steve Ballmer. Here's just the first Google result for 'iPhone too expensive' from 2007.

The Telegraph, November 2007: "Apple iPhone too expensive, say consumers"

http://www.telegraph.co.uk/technology/3355306/Apple-iPhone-too-expensive-say-consumers.html

 

[harrisk954]

I mean, is it really "perceived value" if they cost almost that much to manufacture?

Great point. Manufacturing costs create higher prices at retail, unless the manufacturer takes a hit like Sony did with the PS3. But, the perceived value issue goes to whether or not consumers see the benefits in owning a product at the price it is beings sold at. If a product costs too much to produce and people don't see the value, those products will die because there is only so much of a loss that a company can take. The issue that I see is that some products don't get dinged for being expensive or niche. VR seems to fall into the former category and seem to be getting a lot of scrutiny even though it is new and expensive technology. To me, the prices seem like a bargain for what you get!

 

[harrisk954]

False. There were tons of people laughing at the iPhone's price saying it would never sell, including Steve Ballmer. Here's just the first Google result for 'iPhone too expensive' from 2007.

The Telegraph, November 2007: "Apple iPhone too expensive, say consumers"

http://www.telegraph.co.uk/technology/3355306/Apple-iPhone-too-expensive-say-consumers.html

Certainly, there were some who said that the iPhone was expensive -- it was and still is to me. But, Apple is one of those companies that gets a pass on expensive products. Sony televisions used to be like that. Bravia TVs back in the day were premium. It seems to me that video games, as a general category, are always looked at as being too expensive.

 

[Ryaaan14]

Great point. Manufacturing costs create higher prices at retail, unless the manufacturer takes a hit like Sony did with the PS3. But, the perceived value issue goes to whether or not consumers see the benefits in owning a product at the price it is beings sold at. If a product costs too much to produce and people don't see the value, those products will die because there is only so much of a loss that a company can take. The issue that I see is that some products don't get dinged for being expensive or niche. VR seems to fall into the former category and seem to be getting a lot of scrutiny even though it is new and expensive technology. To me, the prices seem like a bargain for what you get!

Well it's the manufacturer's job to inform people of the technology and value that go into a product. Normally people are pretty transparent about this.

I feel like "perceived value" is more relevant to things like antiques and fine art. Those things cost nearly nothing but can sell for ridiculous prices.

 

[redcrayon]

Different people perceive value in different ways, even when looking at the same product. They use the product in different ways too- someone already using an iMac for work, iCloud and an iPad gets more out of the shared functionality and software on an iPhone than someone with a range of kit might, even if each individual item is better and that second person would be perfectly right in saying that they had a better phone, for them.

Some people look at portables and see weak hardware, expensive games and a redundant second device to carry. To me, portability is an essential factor due to the length of my commute, so home consoles, PC and VR all auto-fail as a 'valuable' gaming platform in my circumstances as I'd never have time to use them. I'm sure the opposite is true for people who drive to work instead.

You'll never get people to agree on value when they have different lifestyles and requirements.

 

[harrisk954]

Different people perceive value in different ways, even when looking at the same product. They use the product in different ways too- someone already using an iMac, iCloud and an iPad gets more out of the shared functionality and software than someone with a range of kit, even if each individual item is better.

Some people look at portables and see weak hardware, expensive games and a redundant second device to carry. To me, portability is an essential factor due to the length of my commute, so home consoles, PC and VR all auto-fail as a 'valuable' gaming platform in my circumstances as I'd never have time to use them. I'm sure the opposite is true for people who drive to work instead.

You'll never get people to agree on value when they have different lifestyles and requirements.

Yeah. I agree. What prompted my thought on this was that I saw that MadCatz fighting stick for over $200 and I thought, "Wow, VR is CHEAP compared to this!"

 

[Karak]

Hmm. There are entire forums dedicated to this kind of thing and Apple is and has always been one of the offenders and most discussed, and its been covered in both main media as well as small youtubers, random videos, hell its been the source of late night talk show intro fodder. In no way is Apple treated differently as a whole.
Perceived value is an indication of something being actually perceived and therefore up to interpretation.

 

[harrisk954]

Hmm. There are entire forums dedicated to this kind of thing and Apple is and has always been one of the offenders and most discussed, and its been covered in both main media as well as small youtubers, random videos, hell its been the source of late night talk show intro fodder. In no way is Apple treated differently as a whole.
Perceived value is an indication of something being actually perceived and therefore up to interpretation.

I was just using Apple as an example. But, look at driving wheels, fighting game sticks, certain indie games vs. AAA games... VR appears to be a bargain when put up head to head against other game-related products. Yet, people are already complaining that it is too expensive.

 

[redcrayon]

I was just using Apple as an example. But, look at driving wheels, fighting game sticks, certain indie games vs. AAA games... VR appears to be a bargain when put up head to head against other game-related products. Yet, people are already complaining that it is too expensive.

But are they the same people though? Plenty of people write off driving wheels and fightsticks as expensive add-ons too.

 

[Bolivar687]

The only thing making me skeptical of VR is its legion of sentinels in the media and elsewhere flocking to its defense and telling me why I need to care about it.

It's strange being told that I need to accept that something is the future simply because publicly traded corporations are collectively spending billions of dollars on it. The weirdest part is, I honestly don't see where the alleged negativity is coming from. The worst thing I've ever heard someone say about VR is that they're tired of pundits talking so damn much about it. I get the impression devs and journalists are hoping to capitalize on the broader public excitement of VR, and that their zealotry is overcompensating for the harsh reality that the games really are as gimmicky as they look and video games probably won't be the Trojan horse this time around.

Every niche has its audience, OP. It's not necessarily vindicated to the larger public simply because a manufacturer accurately measures and satisfies it's demand. Anyone telling you VR is too expensive for their budget or the games don't look compelling is probably giving you their brutally honest opinion.

 

[Karak]

I was just using Apple as an example. But, look at driving wheels, fighting game sticks, certain indie games vs. AAA games... VR appears to be a bargain when put up head to head against other game-related products. Yet, people are already complaining that it is too expensive.

Different prices reflect different audiences, though I am sure there is some kind of differed overlap with different demands on their flexible versus inflexible spending amounts. Its mirrored in every industry...pretty much everywhere.