People buy expensive luxury goods like $50,000 purses and $500,000 Ferraris not for what they do, but for what they signal. Cheaper alternatives work fine functionally. The real purchase is emotional: the need to be seen a certain way and feel a certain status.
Why does a woman want a $50,000 purse? They could go to Walmart and buy a purse for $15 to put their stuff in. But why do they want the $50,000 purse? Because it solves an emotional need. Why does somebody buy a $500,000 Ferrari? It doesn't really solve a problem unless you're, you know, a race car driver, because you can drive a 2012 Toyota Prius to go from point A to point B. But what it does is solves an emotional need. They want to be viewed a certain way, so they feel like they need that car to be viewed, or they need that watch to be viewed a certain way.
