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A Podcast by BBB of the Tri-Counties
A BIG thank you to Ayers Automotive Repair in Santa Barbara for supporting this podcast.
Welcome to this week’s edition of Your Moment of Trust!
Premiumization is when companies offer higher-end products and services for a premium price. Airlines selling both business class vs. economy seats are a classic example. Another is car manufacturers offering a standard model and one featuring heated seats and leather trim.
While these two examples have been around for decades, premiumization has expanded since the Covid-19 pandemic. Now, businesses selling everything from beauty products to booze are adding new premium options and services. As a consumer, evaluating premium options can be tricky. Here are BBB’s tips for weighing new premium options and ensuring you get the promised value.
Tips for navigating premiumization as a shopper
● Do your homework. Brands that offer premium products or services may look like luxury, but as with any purchase, doing some research is vital. Before paying a premium price, ensure the vendor is a trustworthy business with a reputation for good customer service. Look up businesses on BBB.org to review business ratings and comments from customers.
● Understand what makes a product premium. Many business owners are working to maintain profit margins by offering their clients added value in a premium package. However, if a product or service claims to be premium, find out why. Specifically, what makes it better than the basic option? If a vendor can’t give you a good answer, skip the premium price and shop elsewhere.
● Comparison shop. To get the best deal on anything, comparison shopping is a must. This is also true when considering a company’s premium offerings. Find out what similar companies offer and their price point to see if you are really getting added value for the higher price.
● Watch for “greenwashing.” Many companies promote premium options as more sustainable, lower waste, or all-natural. But be wary of misleading green marketing claims. The Federal Trade Commission advises consumers to look for specific information on packages and products that explain why the product is green.
● Keep track of subscriptions. Many companies offer premium services in the form of a subscription. This might mean paying a monthly fee for quicker delivery, exclusive content, or access to superior products. If you purchase a subscription,
and especially if you purchase multiple subscriptions, keep track of them. Review paid subscriptions regularly and cancel any you no longer need to avoid unnecessary spending.
● Don’t want premium? Explore new brands. While some companies are leaning into new premium offerings, others are filling the lower-price space with cheaper options. For example, make-up brands are creating new products similar to high-end options but sell for a fraction of the price.
● Stick to your budget. A good budget can do wonders for your financial health, but only if you respect your spending limits. If your budget only allows you to purchase the basic version of a product or service, skip the premium offerings to keep your finances in the green.
Until next time!