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How to Stop Customers Form Fixating on Prive

In: Business and Management

Submitted By tsakulrompochai
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How to stop customers from fixating on price

This article aims t tackle the problem that nowadays many customers are paying the most attention to the price when they purchase products or services. The article addresses the problem that most customers prefer the products that have the lowest price even though the value of the product is less compared to other products with higher price. This has caused products or services with higher innovation or value to be left uncompetitive. As a result the author proposed three main ways to price products or services that can mitigate the problems stated above. First is to use price structure to make it call attention to the value of the product or services. In order to do this, companies must revise its pricing structure or the basis that companies price various offerings. The key to do this is to vary price according to what’s most distinctive about the offering rather than makeup of the product or service itself. This will allowed the products get out of head-to-head price competition and allow it to compete on the personal relevance to customers of the value it provides. This strategy has been used by Goodyear company as the company had problem that customers were unwilling to pay a premium for the innovations the company introduced to extend tread life. It solved the problem by pricing its various models on the basis of how many miles they could be expected to last rather than their engineering complexity. This highlighted the advantage of those innovations for customers and taught them a new way to compare offerings that was perfectly aligned with the company’s value proposition. The second strategy toward solving the problem is to willfully overprice to stimulate curiosity. The implication for the strategy is that for every purchase decision, there’s a price range above what potential customers say they are…...

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