Price is an Evil Mistress<\/p>\n
Setting our price is a conundrum, isn\u2019t it?\u00a0 If we set our price too high, customers go elsewhere.\u00a0 If we set it too low, we leave money on the table.\u00a0 So it\u2019s a tough line to walk, but we all have to walk it.\u00a0 Wait a minute though, is price all there is?\u00a0 What about value?\u00a0 Doesn\u2019t that count for anything anymore?\u00a0 Yes, as a matter of fact, it does, but thanks to the internet and the ability of customers to compare prices quickly and easily, price has become an even greater part of any marketing strategy.\u00a0 For more on the yin and yang of price vs. value, please read below.<\/p>\n
Sam Bowers, a business professor and lecturer, tells us, \u201cLooking for a place where price is not a factor is going to be a long lonely search in dark jungles.\u201d\u00a0 And General Electric\u2019s Jack Welch adds, \u201cIf you can\u2019t sell a top quality product at the world\u2019s lowest price, you\u2019re going to be out of the game.\u201d
\nWarren Buffet\u2019s take is, \u201cPrice is what you pay.\u00a0 Value is what you get.\u201d\u00a0 And this from an unknown writer: \u201cThe bitter taste of low quality lingers long after the sweet taste of low price has faded.\u201d
\nIn this tug-of-war between price and value, value does have its place.\u00a0 After all, if price was the only consideration, everyone would be driving a Chevy and no one would drive a Mercedes.\u00a0 Think about a restaurant you may have tried where the prices were low but the food was mediocre and the service was lousy.\u00a0 Would you go back?\u00a0 Or think about online retailer Zappos.\u00a0 You can certainly find lower prices than theirs, but they make shopping so easy and customer-friendly, why would you?
\nA recent article in the Chicago Tribune discussed a strategy by Williams and Sonoma, the upscale retailer of kitchen products, to lure their customers away from online shopping and back into their stores.\u00a0 The plan is to offer more in-store product demonstrations and cooking classes, thereby making a Williams and Sonoma shopping experience richer, more entertaining, and more educational for their customers than an online experience would be.
\nSo the trick, apparently, is how you communicate, promote, and execute your value proposition.\u00a0 If your value proposition is, \u201cWe\u2019ve got the lowest prices in town,\u201d better be careful.\u00a0 By definition, there can be only one low-price leader, and there will almost always be someone trying to undercut you and win that dubious crown.\u00a0 So unless you\u2019ve got the size and volume to be a real low-price contender, you\u2019d be wise to find a better value proposition.
\nWhatever your product or service, price is important, but it\u2019s rarely the sole consideration.\u00a0 Remember, while people may argue that your price is too high, they vote with their feet . . . if they\u2019re still talking to you, it means they see value in your offer that they don\u2019t see in others.\u00a0 Obviously, they would like to get your value and the other guy\u2019s price, but you\u2019d be a fool to make that deal.\u00a0 Your value, your price.
\nMake no mistake, people will pay for what they want, and what they want is usually not your bare bones product or service.\u00a0 They usually want something more.\u00a0 It may be convenience, it may be selection, great customer service, a fun, customer-friendly experience, deep product or service knowledge, or a lot of other things.\u00a0 That\u2019s for you to figure out.\u00a0 So get clear on the totality of what your customers want, structure your value proposition based on that, and set your prices accordingly.<\/p>\n","protected":false},"excerpt":{"rendered":"
Price is an Evil Mistress Setting our price is a conundrum, isn\u2019t it?\u00a0 If we set our price too high, customers go elsewhere.\u00a0 If we set it too low, we leave money on the table.\u00a0 So it\u2019s a tough line to walk, but we all have to walk it.\u00a0 Wait a minute though, is price<\/p>\n