Home Tags Pricing strategy
Tag: pricing strategy
I can’t believe how many times lately that I’ve spoken to business owners who claim that their product or service is one of the best in their field. And I believe them. I have absolutely no doubt that they are right. But then when I ask them how they position their pricing, they tell me they choose to set their pricing level in the middle of the market range. Why? It doesn’t make sense.
Most small business owners think that pricing low will win them more customers. This is simply supply and demand logic and there is an element of truth in it. However, there are some complicating factors that tend to make this strategy the least effective competitive strategy for business success.
How do you justify the price of $120 per copy of Windows 7 Home Premium in China against the price of around $300 in Australia without saying rich countries are subsidising the cost of Windows in poor countries?