Let’s face it. In this economy, a limited time offer doesn’t live up to its name. Once you lower your price, you’re facing a marketplace that believes you (a) were overpriced to begin with; (b) will offer that discount at any time; or (c) will go even lower.
Consumers have been conditioned to wait a little longer while retailers slash their prices to the bone—and sometimes even deeper—in a fervent effort to stay afloat. But this knee-jerk reaction to sliding sales is just that. There’s no long-term strategy. In many cases, I don’t believe there’s even a short-term one!
Think ahead a bit. What are you going to do when the economy improves? Are you going to raise your prices? Can you survive on those slim margins when production volume increases?
Price reduction is a nearly impossible strategy for winning the selling war. There is always someone out there who is desperate enough to go even lower than you. Do you want to dance the limbo until your very backbone crumbles?
Before you cut your prices, examine your brand. What does it represent to you and to your buyer? How much have you invested in convincing the market that your brand lives up to its expectations and warrants its price?
Before you slash away at your pricing structure like Zorro on a spree, take a close look at what’s really hurting your selling efforts. Are your salespeople taking the easy route by blaming the drop on pricing? Perhaps they need more training to better identify with the needs of their customers. Maybe they need a refresher in the fundamental benefits of the brand. The truth is, it’s not that buyers are not buying. It’s the sales people who aren’t selling!
Can you put a price on that?