Category Archives: Price


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Future customers

Apple offers students and university staff special discounts on products. It may seem unfair to other buyers, but it’s accepted practice. This is quite common in some markets: although the product is the same, people accept that other customers get a better deal. But it’s more usual in service industries. So museums or shows will offer discounts to certain groups … Continue reading


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Price skimming

Producers of mobile phones, digital cameras, flat screens and similar hi-tech products often have to pump huge budgets into R&D. To get this investment back – and break even as quickly as possible – they tend to “price skim”. This involves using high prices to remove the “cream” from the market before the competitors catch up. Thankfully innovators are willing … Continue reading


Own label compensation

Some companies deliberately sell the same product for a much lower price, even though there is a real danger customers will find out. Why? * To recruit customers to the brand (Boss selling ‘seconds’ in factory outlets can attract people who may trade up next time to higher price products) * To clear out stocks * To help cover fixed … Continue reading


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Discounter hotel?

When your pricing strategy is like Aldi’s – low price, always low price, but good reliable quality – you’ll be pigeon-holed as a “discounter”. There’s nothing wrong with this strategy, as long as you sell products in high volumes. Which is precisely what Aldi does – it’s the No1 in Germany apparently (though it would be nice to see this … Continue reading