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Pricing decisions can be among the most challenging tasks for a marketer. Setting price seems to be part art, part science. A fundamental pricing idea is that value is in the eye of the beholder (or more specifically, the mind of the buyer).
One way that consumers evaluate price is to compare a product’s price. Marketing expert Sean D’Souza says evaluation of product price without anything else to compare to does not communicate value. Price judgments are not made in a vacuum but rather in reference to other prices.
In the article “Do Lower Prices Lead to More Sales?,” Sean D’Souza answers his headline with an emphatic “no.” His solution is for a business to develop a product line that has offerings at different price points, creating comparisons across your products rather than comparing with competing products or there being no comparison at all (pricing in a vaccum).
Take a stance either for or against D’Souza’s call for developing a product line with different price points. Is this the most effective way to communicate product value via the price element of the marketing mix?
