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Pricing Strategies - I’m published in Marketer+

The price of the services and products you sell says something about your brand.

🤔 Is a high price an indicator of brand strength?

🤔 What will the customer pay more for?

🤔 When does it make sense to compete on price?

These questions were answered in the special 60th edition of Polish Magazine Marketer+ which I was honoured to contribute towards alongside world class experts Chris Do, David Avrin, Richard Czerniawski, David Aaker, Richard Sauerman and Dr. Jerome Joseph.

This issue is devoted to the fascinating subject of pricing strategies - and price has a huge impact on brand perception.

It was an honour to me asked by Lukasz Murawski to take part in it.

Here is my written contributions which were published (although translated into Polish!). I hope you find them interesting and useful:

Is the price part of the brand story/storytelling? What story does the price tell?

I define a “brand” as the meaning an audience attaches to a company and its offerings. Branding is “the management of meaning”. Price is very much a part of this. Price tells a story about the perceived value and positioning of a brand. It communicates important messages to customers, such as quality, exclusivity, affordability, or premiumness.

For example, a luxury brand might use high prices to convey a story of exclusivity and superior craftsmanship, while a budget brand might emphasise affordability and value for money.

How to determine the price of a product or service? What should the price of a product or service depend on?

The price of a product or service should depend on various factors, including:

  • Value Proposition: The price should align with the perceived value that customers derive from the brand, product or service. If the offering provides unique features, a deep sense of meaning, superior quality, or solves a significant problem, customers may be willing to pay a higher price.

  • Costs: The price should consider the cost of production, including manufacturing, materials, labor, overheads, and distribution. It is essential to ensure that the price covers costs while allowing for a reasonable profit margin.

  • Market Positioning: The price should reflect the brand's positioning within the market. Premium brands may command higher prices to maintain their exclusivity and perceived value, while budget brands may opt for lower prices to attract price-sensitive customers. It's all about serving your audience at a level which adds value to them.

  • Competitive Landscape: The price should consider the prices of competitors offering similar products or services. Pricing too high or too low compared to competitors can impact market competitiveness and customer perception of your brand.

Determining the price of a product or service requires a strategic approach. The trick is to create an offering the customer cannot get from other brands. To be the only choice for the right type of customer - if you build your brand with a differentiation strategy in mind which is authentic and true you can drive the price point to highly profitable levels. This requires innovation and a leadership team determined to create real value and “manage meaning” through all parts of the customer journey.

What will the consumer pay more for?

Consumers are willing to pay more for various reasons, including:

  • Quality and Performance: Consumers may pay more for products or services that offer superior quality, durability, functionality, or performance.

  • Brand Reputation: Strong brand reputation and trustworthiness can justify higher prices, as customers perceive the brand as reliable and worth the investment.

  • Exclusivity and Rarity: This is the big one. Limited edition or exclusive products/services often command higher prices due to their uniqueness and scarcity, appealing to consumers seeking distinctive offerings. Brands which create unique experiences are the ones which will ultimately succeed long term because it's harder for competitors to take their customers.

  • Personalisation and Customisation: Consumers may be willing to pay more for tailored or personalized experiences, products, or services that cater to their specific needs and preferences.

  • Convenience and Time-Saving: Products or services that offer convenience, time-saving benefits, or simplify complex tasks may justify a higher price as they provide added value and enhance the customer experience.

It's important to note that pricing strategies should consider a balance between customer willingness to pay, profitability, and overall market dynamics to ensure sustainable business success. Manage the meaning your pricing conveys carefully by balancing your price across these factors.

So that's it for now! I wish you all the best in your brand building and remember, price has an important part to play in the long term perception of your brand. Set it carefully!

If you speak/read Polish and would like to know more about Marketer +, discover their website here >


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