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Why is premium the most used and least understood word tech?

  iPhone XS Max
Julian Chokkattu / Digital Trends

You want a premium product, right? Why? Because Premium is not only good, but the best. It's not just premium materials – glass, metal, ceramics or titanium – that seduce us, it's world-class features and even a world-class experience. Premium is used to sell everything from smartphones ̵

1; which we mainly talk about here – to cars and even hotel stays. Premium sells, or more precisely premium upsells, because we like to pay more for the pleasure of feeling like a million dollars while we cum.

It works because who wants to settle for something inadequate? We will not say, "No, thanks, I have the mediocre experience, please." Except what does premium actually mean? Why are we so constantly bombarded with the word, and what is the current obsession to promote anything with it? If we understand this, we may become more sophisticated buyers, take a closer look at what we really want from our phones, and not be influenced by smart marketing.

Defining Premium

Let's start with some definitions. Merriam-Webster defines Premium, when used as an adjective, as "of exceptional quality or quantity", with the very relevant addition "Also: Higher Price" below. For smartphones, there is a more precise definition. According to Counterpoint Research, the premium segment is over $ 400, with between $ 400 and $ 600 in affordable premiums and Ultra premiums starting at $ 800.

  Samsung Galaxy S10 Plus iPhone XS Max
The iPhone XS Max and Samsung Galaxy S10 Plus Julian Chokkattu / Digital Trends

As Merriam-Webster points out, it's the higher price that's usually something Premium refers, and the smartphone-buying audience loves to buy this type of device. According to a study by GfK, 12 percent of mobile phones sold in 2018 cost more than $ 800, compared to nine percent in 2017. Worldwide mobile phone sales of more than $ 400 increased by 18 percent in 2018, according to a report Counterpoint Research, a time when smartphone sales were made overall dropped by two percent. We can not get enough of premium products.

To describe something as premium binds it directly to the price and thus to the perception of a product or a brand.

"Everyone should experience the benefits of technological advancement, not just the lucky ones."

"The best way to position a product as a premium brand is at a high price," wrote Laura Ries, co-founder of the consulting firm Rise & Ries, in an article for Entrepreneur. "The price sends a psychological message in terms of value: things that cost more are rated as higher. Things that cost less are considered to be of lesser value. "

We asked Mark Ritson, marketing professor at Melbourne Business School in Australia, what premium as a concept really means.

" You make a few fewer [products]you charge a lot more, you restrict the sales, However, emphasize its heritage and heritage, "he said in an email to Digital Trends. "The gross margin is rising, sales are only marginally disturbed (if at all) and you are making much more money."

If you say so, it's not hard to understand why this term is so popular. 19659016] mediatek helio p90 interview building “/>

Andy Boxall / Digital Trends

Premium technology without premium price

Does a premium product always have a high price? No. HMD Global, the company that owns the Nokia brand name Nokia, told Digital Trends in an email:

"Premium is not something that should be limited to flagship smartphones and consumers who have the money want to spend money to buy them. Premium should be accessible to all. "

The semiconductor company MediaTek is a prime example and uses the word premium to emphasize value without compromising functionality. According to the company, the Helio chips are used in devices that are "equipped with high-quality features at affordable prices." She calls this technology "New Premium," a strategy she introduced in mid-2018.

Today, GfK has preferred to own less high-quality products and value experience with possessions.

"Everyone should experience the benefits of technological advances and not just the lucky ones," said MediaTek in an email to Digital Trends. "If modern equipment is affordable, it will make it easier for consumers to take risks for new brands, new features and new form factors, which creates an incentive for companies to think outside the box."

This will encourage processors in the same way the Helio P70 and the Helio P90, which can be found in devices that do not cost a fortune and yet offer "premium" features. Take the Helix P70-powered Realme 3 as an example – a $ 150 smartphone with on-camera intelligence capabilities – for a better experience than you'd expect for that price.

  Impressions of the Realm 3 Test
The Realme 3 Andy Boxall / Digital Trends

A premium-price-free premium experience makes value-based products more valuable and is used by various companies, not just MediaTek. It's also the same approach that car maker Kia is following. Marketing director David Hilbert said the brand would give up its low-cost reputation in the UK with the Stinger, an attractive car that competes directly with premium brands that demand more for extras standard on Kia.

Premium means first

] Qualcomm has not missed the opportunity to push a premium experience and even uses the same New Premium phrase as MediaTek, but it's not about value or price. Take a look at his new marketing for the Snapdragon 855 processor – the chip found in the most expensive flagship phones of 2019 – and you'll come across the phrase "First, the new bonus." That means if you're fastest chip in your phone and 5G connectivity, then you get a premium experience – fast is equal to first, which is equal to premium in Qualcomm's book.

"First, the new premium is a campaign by Qualcomm that makes it the best and most differentiated mobile experience. For the people first," said Penny Baldwin, Senior Vice President and Chief Marketing Officer at Qualcomm, in an E -Mail vs. Digital Trends. Baldwin added that using 5G and HDR games on a smartphone is an example of what Premium means for Qualcomm.

Take a look at the promotional video and learn how it is built around what you can do, not what you pay for. The research company GfK has found that people today prefer to have less high-quality products and value experiences. This trend uses Qualcomm together with the premium experts Apple.

Although the term is not widely used in its marketing, the word "premium" is used in conjunction with Apple and its products. Like Qualcomm, Apple is not concerned about the price, and he certainly invented the ultra-premium segment with the advent of the iPhone X. In addition to adapting Ritson to almost perfect, it fits (often existing) functions and binds them to experiences that should appeal to people.

When It Starts to Be Meaningless

Even if you have to squint a little, it's obvious how MediaTek and Qualcomm use the word premium, how they differ, and what it means to you. The problem occurs when everyone starts using the word, often for no good reason. Look hard and premium is everywhere, often without facts that support the claim.

  Sony Xperia XZ2 Premium XZ family comparison
The Sony Xperia XZ2 Julian Chokkattu / Digital Trends

Examples? The Three UK Network launched a new marketing campaign that redefined the brand in late 2018. In an interview with Marketing Week, the brand must be "high quality and playful". Nubia calls the Red Magic Mars smartphone a premium gaming smartphone with no premium price, and Sony has taken the floor in the name of its latest flagship, the Xperia XZ2 Premium.

In addition, there is a phenomenon that as "Advertising up According to a study by Science Direct, which was published in late 2018, non-premium brands try to emulate premium brand advertising, to increase the effectiveness of their own advertising and to increase the equity of the brand.

It seems in addition If we do not want to understand the premium connection, we can not always trust that the premium will match the premium.

Should we be careful?

When the word "premium" is abused to the point where its true meaning is obscured – and even when we understand it, it turns out that it means both high value and high cost – should we pay attention to the word or ignore it if possible?

  Samsung Galaxy Fold Announcement | Samsung Unpacked
Julian Chokkattu / Digital Trends

This is easier said than done, especially since it will not disappear in the foreseeable future. The era of smartphones that were twice as expensive as the iPhone X – the first ultra-premium mobile phone – is here, and brands continue to adjust Premium to earn even more. In an interview with Digital Trends at the recent Galaxy Unpacked event, Samsung's Daniel Benjamin talked about Galaxy Fold's $ 1,980 prize. He said, "Beat in a super premium category" before adding that premium is the fastest growing segment in the UK.

Premium is not just staying here, it's evolving. Mark Ritson summarizes why we should not fall into the trap of the marketing officer, even if he is becoming more frequent.

"When a product or service is premium, it's almost equivalent to a meat" of course, "he said." At first it looks appealing, but on closer inspection, it does not mean anything, it sounds good and fills up Page, without actually communicating anything but a vague touch of superiority. "

More than ever before, we need to think about which device suits our needs, how long we'll keep it, and how much we're willing to pay. Do not just pick the latest so-called premium phone and cash in.

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