The Law of Perception: Perception Is Reality

This article is an excerpt from the Shortform book guide to "The 22 Immutable Laws of Marketing" by Al Ries and Jack Trout. Shortform has the world's best summaries and analyses of books you should be reading.

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Why is perception more important than quality when it comes to marketing? What is the “everybody knows” principle?

The Law of Perception states that your most potent weapon in marketing is not the quality of your product, but rather the public’s perception of your product. Your marketing will only be successful if consumers believe that your product is the best.

Keep reading for more information about the Law of Perspective and the Law of the Mind.

The Law of Perception

In the battle for prospective customers’ minds, you must fight not only to be first in mind but also best in mind. Contrary to popular belief, the Law of Perception says that your most potent weapon in marketing is not the quality of your product, but rather the public’s perception of your product. Simply put, perception is reality: No matter what research and performance tests reveal, your marketing will only be successful if consumers believe that your product is the best. Have you ever tried to get someone to change her mind about something she was absolutely convinced was true? You can throw every fact at the person and, still, if someone is convinced that something is true, then it is—at least, it’s true in her mind, and that’s all that matters.

Perception Trumps Quality

These are just two examples that illustrate how perception trumps product quality: 

  1. Japanese carmakers sell Honda, Toyota, and Nissan in both Japan and the United States. Given that the quality, design, and power of the cars are identical in both countries, and the prices are nearly the same, the best-selling car should be the same in both places. However, while Honda trails behind Toyota and Nissan in Japan, it sells far more cars in the U.S. Honda is considered a quality car company in the U.S., but Japanese customers perceive Honda primarily as a motorcycle manufacturer, and they don’t perceive a motorcycle company to be a source for high-quality cars.
  2. When the Coca-Cola Company introduced New Coke, it conducted a taste test among 200,000 people that revealed that New Coke had the best taste, followed by Pepsi, followed by Coca-Cola Classic. However, the sales were reversed: Coca-Cola Classic had the highest sales, followed by Pepsi, with New Coke last. If product quality truly determined marketing success, the sales should correlate with the taste test data. 

This isn’t just true in marketing—in all areas of life, people assume that their perception of reality is the truth. In fact, there is no objective truth; the only truths are those that people perceive. People think that reality exists outside their minds, but the only reality is the one they create within their minds. Your prospective customers have their own truths, and you’ll be hard pressed to sway them with facts about how your product is better than your competitor’s. Instead, build your marketing plan around the way people form perceptions. Marketing manipulates people’s perceptions and, thus, their realities. 

People’s individual perceptions are also influenced by other people’s perceptions. This is the “everybody knows” principle—as in, everybody knows that Japanese cars are higher quality than American-made cars. Consumers often base their buying decisions on common knowledge and hearsay, even if they haven’t had any personal experience with the product. Furthermore, the “everybody knows” principle is even stronger than firsthand experience. In other words, shoppers who have used a product interpret their experiences to align with what “everybody knows.” For example, since Japanese cars are better quality, if you had a reliable American car, it must have been purely good luck. 

The Law of the Mind

Although Law #1 states that you need to the first in the marketplace, Law #3 amends that principle: Above all, you need to be first in consumers’ minds—when consumers think of the product you sell, they should immediately think of your brand. Being first in the market merely gives you a head start to get into the public’s mind.

Although being the first entrant in a market gives you the opportunity to be first in people’s minds, it also carries responsibility to convince people that they need this product to begin with. You can have a revolutionary product, but it’s not worth much if you can’t convince anyone to buy it. There are examples throughout history of companies that were first to market with a product but failed to establish a need for it: 

  • Duryea Motor Wagon Company manufactured the first gas-powered car, but the credit typically goes to Ford, who followed closely after. 
  • Hurley Electric Laundry Equipment Company produced the first automatic washing machines, followed by Barlow & Seeling Manufacturing, which later became Speed Queen. While Hurley no longer exists, Speed Queen is now the world leader for industrial washing machines. 
The Law of Perception: Perception Is Reality

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  • Why the quality of your product matters less than customers' perceptions of it
  • Why trying to appeal to everyone will sink your sales
  • How Marlboro sold more cigarettes to women by marketing to cowboys

Hannah Aster

Hannah graduated summa cum laude with a degree in English and double minors in Professional Writing and Creative Writing. She grew up reading books like Harry Potter and His Dark Materials and has always carried a passion for fiction. However, Hannah transitioned to non-fiction writing when she started her travel website in 2018 and now enjoys sharing travel guides and trying to inspire others to see the world.

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