The Hidden Power of Costly Signaling: Why Presentation Shapes Value
Sometimes, we underestimate how much presentation shapes perception. In this talk, I wanted to expose a concept that influences countless decisions we make every single day, a concept called costly signaling. It’s the idea that effort, investment, and even unnecessary extravagance can communicate value far beyond the actual substance of a product or experience.
When I stepped onto that theatrical stage the piano, the lighting, the full dramatic setup it was deliberately unnecessary. It was a trick. But it was also a message. It signaled that I care enough to invest in the experience, to go above and beyond. That visible effort communicates dedication before I even say a word.
That is costly signaling in action.
Why Effort Matters More Than the Product Itself
We see this phenomenon everywhere. Think about a Zoom call: you can join from your couch in sweatpants, or you can set up lighting, framing, and good audio. The content might be exactly the same, but the perception is completely different.
Humans are wired to respond to signals and gestures that show someone cares, someone invested, someone took the time.
That’s why packaging, design, and branding matter far more than we often admit.
The Truth About Lipstick and Perceived Value
Take lipstick. Many brands from budget-friendly Revlon to luxury names like Elizabeth Arden use almost identical formulas. Same ingredients. Same performance.
Yet people willingly pay five times more for the premium version.
Why? Because the packaging, the brand story, the weight of the tube, and even the look of the logo send powerful signals:
This is high quality
This is aspirational
This says something about me
The ingredients didn’t create the value the presentation did.
The Vodka Story: When Branding Outweighs Reality
Another example I love is vodka, specifically Costco’s Kirkland vodka vs. Grey Goose. They’re made from the same ingredients, in the same region, yet the price difference is massive. And the taste? Almost indistinguishable.
So what are consumers paying for?
Not the vodka.
Not the liquid.
They’re paying for the story. The prestige. The emotional signal that says, “I choose something premium.”
Branding is costly signaling.
Innovation Isn’t Always About the Product
We often think innovation means new features, better performance, or groundbreaking breakthroughs. But a huge part of innovation is actually perception.
You can take the same product, reframe it, redesign it, or reintroduce it and suddenly, it feels new. I explored this idea deeply in another piece about how exceptional experiences transform brand perception you can read it here.
Innovation isn’t just what you build.
It’s how you make people feel about it.
Great brands understand this.
Great creators use it.
Great companies master it.
Context, Transparency, and Humor: The Signals We Forget to Notice
One of the funniest moments of this talk was acknowledging the absurdity of filming a dramatic theater presentation while holding vodka in the middle of a pandemic. It was weird. It was human. And that small moment of transparency signaled something powerful: authenticity.
We often believe professionalism means hiding the awkward parts. But in a world optimized for perfection, honesty and humor become their own form of costly signaling because not everyone is willing to be vulnerable or break the script.
When you reveal the trick behind the production, you don’t lose credibility.
You build trust.
The Takeaway: Presentation Shapes Value More Than We Realize
Costly signaling isn’t manipulation.
It’s a fundamental part of how humans interpret the world.
Effort signals care
Aesthetics signal intention
Design signals status
Transparency signals trust
Context signals meaning
Whether you’re pitching an idea, launching a product, writing an email, or building a brand, the presentation around the content often matters just as much as the content itself.
Once you understand this, you stop obsessing over the question:
“How do I make the product better?”
And you start asking something far more powerful:
“How do I make the experience better?”
Because in the end, value isn’t just created, value is communicated.
Frequently Asked Questions
Q1. What is costly signaling?
Costly signaling is when someone or a brand invests extra effort, time, or money to show value or commitment. The action might not be necessary to function, but it sends a message that they care. It influences how others perceive quality, trust, and status, even without changing the actual product.
Q2. Why does presentation affect how we judge value?
Presentation shapes first impressions. When something looks well-designed or thoughtfully prepared, our brains assume it is higher quality. That’s why good packaging, visuals, or environment can make the same product feel more premium. The experience around something changes how we value it.
Q3. How does branding change the way people see a product?
Branding adds emotional meaning. It tells a story about lifestyle, identity, and status. Two products may be almost identical, but people pay more for the one that makes them feel confident or special. Branding creates perception and perception often becomes reality for consumers.
Q4. Why do people pay more for luxury items when cheaper options exist?
People pay for the feeling attached to a luxury brand's confidence, pride, and social identity. Luxury products signal success and taste, even if the quality is similar to lower-priced options. The emotional value and social meaning make them worth the extra cost for many buyers.
Q5. Is costly signaling manipulation?
No, costly signaling isn’t about tricking people; it’s about showing effort and intention. When someone invests in quality presentation, it demonstrates care and commitment. People appreciate visible effort because it builds trust. It becomes manipulation only if the product itself is dishonest.
Q6. How can businesses use costly signaling effectively?
Businesses can invest in design, packaging, customer service, and experience. Even small touches like better lighting, thoughtful communication, or premium unboxing signal quality. When the presentation feels intentional, customers assume value and are more likely to trust and remember the brand.
About the Author:
Shawn Kanungo is a globally recognized disruption strategist and keynote speaker who helps organizations adapt to change and leverage disruptive thinking. Named one of the "Best New Speakers" by the National Speakers Bureau, Shawn has spoken at some of the world's most innovative organizations, including IBM, Walmart, and 3M. His expertise in digital disruption strategies helps leaders navigate transformation and build resilience in an increasingly uncertain business environment.