While we're on the subject of pricing strategy, here's a video by Paul Hunt, President of Pricing Solutions.* In this video, titled, "Customers want the best value, not the best price," Paul asks why the discussion always seems to be "price-price-price" when it should be "value-value-value"? Paul gives the example of two green apples that appear to be the same, then goes into a discussion of what goes into customer's decision-making when there's a choice and things only seem equal:
Paul's messages about value vs. price:
- Look more closely.
- It's all about differentiation that's meaningful to the customer.
- It's differentiation that they will pay more for something that they value.
*Pricing Solutions is an international pricing strategy consultancy dedicated to helping clients achieve World Class Pricing competency. Paul publishes a weekly pricing column in the Financial Post Executive. He also writes for the Pricing Solutions Club and lectures widely on pricing.
What are your thoughts on pricing vs. value?