Posted on Friday, 27th March 2009 by Lee
Entrepreneur.com has a short piece about the pros and cons of lowering your price to attract more customers in this recession economy. Read the rest here.
Pricing Questions to Ask Now
Mark Loschiavo, senior executive in residence and executive director of the Baiada Center at Drexel University’s LeBow College of Business, has pinpointed the following four questions as the most important to consider when thinking about a price change.1. Are you offering something your customers need? If not, you may need to drop prices to get a percentage of the customer’s wallet. During recessions, must-haves almost always trump nice-to-haves.
2. Are you offering an affordable luxury? During a recession, most consumers may still be willing to indulge a little.
3. Are you offering something that can help your customers weather the recession? If so, does your marketing and sales message drive this point home? Then you may be able to price accordingly. If not, you may need to drop prices.
4. Are you decidedly better than your competition? The more differentiated your products or services, the lower the associated price elasticity. But there are limits to this logic. Regardless of differentiation, at some point, the price or value trade-off will drive the market to the lower-priced alternative.
Read the rest here.
Tags: business, economy, marketing, online, price, recession
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