As a business owner, the price of your product or service can make or break your business. Pricing strategy is a complex topic that is beyond the scope of this post. But, it is worth mentioning, that our generation is less focused on price and more focused on value. The food industry is a great indication of this - customers buy healthier foods despite the increased cost.
Nielsen recently posted an interesting article, which provides the context for this post.
Price point is critical for consumers that have limited resources. Price point is not as important for consumers that have more buying power, and have the flexibility to consciously choose which brands and businesses they support. It’s up to you as a business owner to select your target audience, and align your promotions and pricing tiers appropriately.
There’s a popular skit by “In Living Color” found here, that demonstrates a common interaction between black business owners and black customers. In short, the customer refuses to pay full price, and proposes comical ways to pay for certain goods. Strategically placed promotions are reasonable, but customers should not expect special treatment.
The debate over price is futile if the perceived value of the product is not recognized by your customers. Generally speaking, as business owners, we need to focus on value. Unfortunately, there’s nothing a business owner can do to change the sentiment of a price driven customer; they will always purchase the cheapest option. Instead, we should focus on appealing to consumers that value our business, and are willing to pay for it.